What changed in this filing

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Item 1A. Risk Factors

2023-02-22 compared with 2022-02-24 · 238 added, 215 removed, 1071 unchanged (30% of the section changed)

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Our net losses were $220.4 million, $192.5 million, and $116.0 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2021, we had an accumulated deficit of $857.7 million.

As of December 31, 2022, we had an accumulated deficit of $1.1 billion.

We have financed our operations primarily through public offerings of our common stock, our collaboration with Bristol Myers Squibb Company (“BMS”) through its wholly owned subsidiary, Juno Therapeutics, Inc.

(“Juno Therapeutics”) , and payments under our strategic alliance with Allergan Pharmaceuticals International Limited (which was acquired by AbbVie Inc.

in May 2020 and is referred to together with its affiliates as “Allergan”), which was terminated in August 2020.

(“Juno Therapeutics”) , and payments under our former strategic alliance with Allergan Pharmaceuticals International Limited (which was acquired by AbbVie Inc.

in May 2020 and is referred to together with its affiliates as “Allergan”).

We have devoted substantially all of our efforts to research and development.

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We anticipate that our expenses will increase substantially if and as we:

● progress the clinical development of EDIT-101 to treat Leber congenital amaurosis (“LCA”) 10 (“LCA10”), including expanding trial enrollment to explore dose response and support establishment of registrational trial endpoints;

● progress the clinical development of EDIT-301 to treat sickle cell disease and prepare for and initiate the clinical development of EDIT-301 to treat transfusion-dependent beta-thalassemia;

● continue our current research programs and our preclinical and clinical development of product candidates from our current research programs, including EDIT-103, our experimental medicine to treat rhodopsin-associated autosomal dominant retinitis pigmentosa, and EDIT-202, our experimental medicine to treat solid tumors;

● progress the clinical development of EDIT-301 to treat severe sickle cell disease (“SCD”) and transfusion-dependent beta-thalassemia (“TDT”);

● continue our current research programs, including ex vivo treatments for hemoglobinopothies and in vivo gene editing medicines, and our preclinical and clinical development of product candidates from our current research programs;

● seek to identify additional research programs and additional product candidates;

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● continue to operate as a public company.

We are in the early stages of the clinical development of EDIT-101 and EDIT-301 and expect that it will be many years, if ever, before we have a product candidate ready for commercialization.

We are in the early stages of the clinical development of EDIT-301 and expect that it will be many years, if ever, before we have a product candidate ready for commercialization.

To become and remain profitable, we must develop and eventually commercialize a medicine or medicines with significant market potential.

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We may never succeed in these activities and, even if we do, may never generate revenues that are significant or large enough to achieve profitability.

Other than EDIT-101 and EDIT-301, we are currently only in the preclinical testing stages for our most advanced research programs.

Other than EDIT-301, we are currently only in the preclinical testing stages for our most advanced research programs.

If we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.

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If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce, or eliminate our research and product development programs or future commercialization efforts.

We expect that our existing cash, cash equivalents, and marketable securities at December 31, 2021 and anticipated interest income will enable us to fund our operating expenses and capital expenditure requirements through 2023.

We expect that our existing cash, cash equivalents, and marketable securities at December 31, 2022 and anticipated interest income will enable us to fund our operating expenses and capital expenditure requirements into 2025.

Our future capital requirements will depend on many factors, including:

● the scope, progress, results, and costs of drug discovery, preclinical development, laboratory testing, and clinical or natural history study trials for the product candidates we develop;

● the costs of progressing the clinical development of EDIT-101 to treat LCA10, including expanding trial enrollment to explore dose response and support establishment of registrational trial endpoints;

● the costs of progressing the clinical development of EDIT-301 to treat sickle cell disease and preparing for and initiating the clinical development of EDIT-301 to treat transfusion-dependent beta-thalassemia;

● the costs of progressing the clinical development of EDIT-301 to treat SCD and TDT;

● the costs of preparing, filing, and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights, and defending intellectual property-related claims;

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Adequate additional financing may not be available to us on acceptable terms, or at all.

Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish

rights to our technologies or product candidates.

Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates.

Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of public or private equity offerings, debt financings, collaborations, strategic alliances, and licensing arrangements.

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Our operations to date have been limited to organizing and staffing our company, business planning, raising capital, acquiring and developing our technology, identifying potential product candidates, undertaking preclinical studies and initiating clinical trials.

Except for EDIT-101 and EDIT-301, all of our research programs are still in the preclinical or research stage of development, and the risk of failure of all of our research programs is high.

We have not yet demonstrated an ability to successfully complete any clinical trials, including large-scale, pivotal clinical trials, obtain marketing approvals, manufacture a commercial-scale medicine, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful commercialization.

Except for EDIT-301, all of our research programs are still in the preclinical or research stage of development, and the risk of failure of all of our research programs is high.

successful commercialization.

In addition, we may encounter unforeseen expenses, difficulties, complications, delays, and other known and unknown factors.

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Risks Related to Discovery, Development, and Commercialization

We are dependent on the success of our lead product candidate, EDIT-301, which is in clinical development.

Clinical trials of product candidates may not be successful.

If we are unable to complete the clinical development of, obtain marketing approval for, or successfully commercialize this product candidate, either alone or with a collaborator, or if we experience significant delays in doing so, our business would be substantially harmed.

In January 2023, we implemented a strategic reprioritization of our portfolio to focus on hemoglobinopathies and in vivo gene editing, and in connection with that paused patient enrollment in our clinical EDIT-101 program, terminated our AAV IRD platform, and divested our preclinical wholly owned iNK programs.

As a result, we have one ongoing clinical-stage program, EDIT-301.

We currently have no products approved for sale and are investing a significant portion of our efforts and financial resources in the development of EDIT-301 for the treatment of SCD and TDT.

Our prospects are substantially dependent on our ability, or that of any future collaborator, to develop, obtain marketing approval for and successfully commercialize EDIT-301.

Because our business is significantly dependent upon this one product candidate, any setback in the clinical development or the obtaining of regulatory approval for EDIT-301 would have a material adverse effect on our business and prospects.

The success of our EDIT-301 program will depend on several factors, including the following:

● successful enrollment and completion of our RUBY Phase 1/2 clinical trial of EDIT-301 for the treatment of SCD and our EDITHAL Phase 1/2 clinical trial of EDIT-301 for the treatment of TDT, as well as any additional clinical trials of EDIT-301 that we undertake;

● safety, tolerability and efficacy profiles that are satisfactory to the FDA, or any comparable foreign regulatory authority for marketing approval;

● timely receipt of marketing approvals from applicable regulatory authorities;

● the performance of our future collaborators, if any;

● the extent of any required post-marketing approval commitments to applicable regulatory authorities;

● establishment of supply arrangements with third-party raw materials suppliers and manufacturers;

● establishment of arrangements with third-party manufacturers to obtain finished drug products that are appropriately packaged for sale;

● obtaining and maintaining patent, trade secret protection and regulatory exclusivity, both in the United States and internationally;

● protection of our rights in our intellectual property portfolio;

● successful launch of commercial sales following any marketing approval;

● a continued acceptable safety profile following any marketing approval;

● commercial acceptance by patients, the medical community and third-party payors following any marketing approval;

● our ability to compete with other therapies, including therapies that are further advanced in clinical development.

Many of these factors are beyond our control, including the outcome of clinical development, the regulatory submission process, potential threats to our intellectual property rights and the manufacturing, marketing and sales efforts of any future collaborator.

If we are unable to develop, receive marketing approval for and successfully commercialize EDIT-301, on our own or with any future collaborator, or experience delays as a result of any of these or other factors, our business would be substantially harmed.

We intend to identify and develop product candidates based on a novel genome editing technology, which makes it difficult to predict the time and cost of product candidate development.

No therapeutic products that utilize genome editing technology have been approved in the United States or in Europe, and there have only been a limited number of human clinical trials of a genome editing product candidate.

No therapeutic products that utilize genome editing technology have been approved in the United States or in Europe.

We have concentrated our research and development efforts on our genome editing platform, which uses CRISPR technology.

Our future success depends on the successful development of this novel genome editing therapeutic approach.

To date, no therapeutic product that utilizes genome editing, including CRISPR technology, has been approved in the United States or Europe and there have been only a limited number of clinical trials involving the use of a therapeutic utilizing genome editing technologies.

To date, no therapeutic product that utilizes genome editing, including CRISPR technology, has been approved in the United States or Europe.

It is difficult for us to predict the time and cost of product candidate development, and we cannot predict whether the application of our genome editing platform, or any similar or competitive genome editing platforms, will result in the identification, development, and regulatory approval of any medicines.

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Regulatory requirements governing genetic medicines, and in particular any novel genetic medicines we may develop, have changed frequently and may continue to change in the future.

Regulatory requirements governing genetic and cellular medicines, and in particular any novel genetic medicine products we may develop, have changed frequently and may continue to change in the future, including, for example, the draft guidance document titled “Human Gene Therapy Products Incorporating Human Genome Editing” issued by the FDA in March 2022.

We are aware of a limited number of genetic medicines that have received marketing authorization from the FDA and EMA.

Even with respect to more established products in the genetic medicine field, the regulatory landscape is still developing.

Even with respect to more established products in the genetic medicine field, the regulatory

landscape is still developing.

For example, the FDA has established the Office of Tissues and Advanced Therapies (formerly the Office of Cellular, Tissue and Gene Therapies) within CBER to consolidate the review of genetic medicines and related products, and the Cellular, Tissue and Gene Therapies Advisory Committee to advise CBER on its review.

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If we were to engage an NIH-funded institution to conduct a clinical trial, that institution’s IBC as well as its IRB would need to review the proposed clinical trial to assess the safety of the trial.

In addition, adverse developments in clinical trials of genetic medicine products conducted by

others may cause the FDA or other oversight bodies to change the requirements for approval of any product candidates we may develop.

In addition, adverse developments in clinical trials of genetic medicine products conducted by others may cause the FDA or other oversight bodies to change the requirements for approval of any product candidates we may develop.

Similarly, the EMA may issue new guidelines concerning the development and marketing authorization for genetic medicine products and require that we comply with these new guidelines.

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The regulatory approval process for novel product candidates such as the product candidates we may develop can be more expensive and take longer than for other, better known or more extensively studied pharmaceutical or other product candidates.

Regulatory agencies administering existing or future regulations or legislation may not allow production and marketing of products utilizing non-viral genetic medicine technology in a timely manner or under technically or commercially feasible conditions.

Regulatory agencies administering existing or future regulations or legislation may not allow production and marketing of products utilizing non-viral genetic medicine technology in a

timely manner or under technically or commercially feasible conditions.

In addition, regulatory action or private litigation could result in expenses, delays or other impediments to our research programs or the commercialization of resulting products.

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The success of our business depends primarily upon our ability to identify, develop, and commercialize products based on our genome editing platform.

Other than EDIT-101 and EDIT-301, all of our product development programs are still in the preclinical or research stage of development.

Other than EDIT-301, all of our ongoing product development programs are still in the preclinical or research stage of development.

Our research programs, including those subject to our collaboration with BMS, may fail to identify potential product candidates for clinical development for a number of reasons.

Our research methodology may be unsuccessful in identifying potential product candidates, or our potential product candidates may be shown to have harmful side effects or may have other characteristics that may make the products impractical to manufacture, unmarketable, or unlikely to receive marketing approval.

If any of these events occur, we may be forced to abandon our development efforts for a program or programs,

which would have a material adverse effect on our business, financial condition, results of operations, and prospects.

Our research methodology may be unsuccessful in identifying potential product candidates, or our potential product candidates may be shown to have harmful side effects or may have other characteristics that may make the products impractical to manufacture or commercialize, or unlikely to receive marketing approval.

The occurrence of these events may force us to abandon our development efforts for a program or programs, which could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Research programs to identify new product candidates require substantial technical, financial, and human resources.

We may focus our efforts and resources on potential programs or product candidates that ultimately prove to be unsuccessful.

For example, in November 2022 we announced updated clinical data from our Phase 1/2 BRILLIANCE trial of EDIT-101 to treat Leber congenital amaurosis.

This data demonstrated a favorable safety profile and provided proof of concept.

However, we were not able to identify any baseline characteristics of the treatment responder patients that could pre-select a responder patient population other than zygosity.

The identified responder patient population was determined to be too small to progress the program independently.

We have since paused patient enrollment in this program.

The genome editing field is relatively new and is evolving rapidly.

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Other companies have previously undertaken research and development of genome editing technologies using zinc finger nucleases, engineered meganucleases, and transcription activator-like effector nucleases, but to date none has obtained marketing approval for a product candidate.

There can be no certainty that the CRISPR/Cas9 or CRISPR/Cas12a technology will lead to the development of genomic medicines, that other genome editing technologies will not be considered better or more attractive for the development of medicines or that either Cas9 or Cas12a, the two CRISPR associated proteins that we use, may be useful or successful in developing therapeutics.

There can be no certainty that the

CRISPR/Cas9 or CRISPR/Cas12a technology will lead to the development of genomic medicines, that other genome editing technologies will not be considered better or more attractive for the development of medicines or that either Cas9 or Cas12a, the two CRISPR associated proteins that we use, may be useful or successful in developing therapeutics.

For example, Cas9 or Cas12a may be determined to be less attractive than other CRISPR enzymes, including CRISPR enzymes that have yet to be discovered.

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Any of these factors could reduce or eliminate our commercial opportunity, and could have a material adverse effect on our business, financial condition, results of operations, and prospects.

We depend heavily on the success of EDIT-101 and EDIT-301.

Except for EDIT-101 and EDIT-301, all of our product development programs are at the preclinical or research stage.

Except for EDIT-301, all of our product development programs are at the preclinical or research stage.

Preclinical testing and clinical trials of product candidates may not be successful.

If we are unable to commercialize any product candidates we develop or experience significant delays in doing so, our business will be materially harmed.

We have invested a significant portion of our efforts and financial resources in the identification and development of EDIT-101 and EDIT-301.

Our ability to generate product revenues, which we do not expect will occur for many years, if ever, will depend heavily on our successful development and eventual commercialization of EDIT-101 and EDIT-301 and other product candidates that we have identified or may identify in the future.

The success of product candidates we identify and develop will depend on many factors, including our ability to successfully:

● identify product candidates and complete research and preclinical and clinical development of any product candidates we may identify;

● seek and obtain regulatory and marketing approvals for any of our product candidates for which we complete clinical trials;

● launch and commercialize any of our product candidates for which we obtain regulatory and marketing approval by establishing a sales force, marketing, and distribution infrastructure;

● qualify for adequate coverage and reimbursement by government and third-party payors for any of our product candidates for which we obtain regulatory and marketing approval;

● develop, maintain, and enhance a sustainable, scalable, reproducible, and transferable manufacturing process for the product candidates we develop;

● establish and maintain supply and manufacturing relationships with third parties that can provide adequate, in both amount and quality, products and services to support clinical development and the market demand for any of our product candidates for which we obtain regulatory and marketing approval;

● obtain market acceptance of any product candidates we develop as viable treatment options;

● address competing technological and market developments;

● implement and maintain internal systems and infrastructure, as needed;

● negotiate favorable terms in any collaboration, licensing, or other arrangements into which we may enter and performing our obligations in such arrangements;

● maintain, protect, and expand our portfolio of intellectual property rights, including patents, trade secrets, and know-how;

● avoid and defend against third-party interference or infringement claims;

● attract, hire, and retain qualified personnel.

The foregoing also applies to our collaborators to the extent we have partnered, sold or licensed any of our research programs to them.

If we or our collaborators do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully commercialize any product candidates we develop, which would materially harm our business.

Our ability to generate product revenues, which we do not expect will occur for many years, if ever, will depend heavily on our successful development and eventual commercialization of product candidates that we have identified or may identify in the future.

Our research programs, including any with collaborators, may fail to identify potential product candidates for clinical development for a number of reasons, or our potential product candidates may be shown to have harmful side effects or may have other characteristics that may make the product candidates impractical to manufacture, unmarketable, or unlikely to receive marketing approval.

Any potential product candidates we identify will require preclinical and clinical activities and studies, regulatory review and approval in each jurisdiction in which we intend to market the products, substantial investment, establishing manufacturing capabilities, access to sufficient commercial manufacturing capacity and significant marketing efforts before we can generate any revenue from product sales.

We currently generate no revenue from sales of any product and we may never be able to develop or commercialize a marketable product.

If serious adverse events, undesirable side effects, or unexpected characteristics are identified during the development of any product candidates we develop, we may need to abandon or limit our further clinical development of those product candidates.

Other than in connection with the EDIT-101 Phase 1/2 clinical trial, for which we began dosing patients in 2020, we have not evaluated any product candidates in human clinical trials, and our proposed delivery modes, combined with CRISPR technology, have a limited history, if any, of being tested clinically.

It is impossible to predict when or if any product candidates we develop will ultimately prove safe in humans, including EDIT-101 and EDIT-301.

We have limited experience in evaluating product candidates in human clinical trials, having dosed our first patient in a clinical trial in 2020, and our proposed delivery modes, combined with CRISPR technology, have a limited history, if any, of being tested clinically.

It is impossible to predict when or if any product candidates we develop will ultimately prove safe in humans, including EDIT-301.

In the genomic medicine field, there have been several significant adverse events from gene therapy treatments in the past, including reported cases of leukemia and death.

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If any of the product candidates we develop or the delivery modes we rely on cause undesirable side effects, it could delay or prevent their regulatory approval, limit the commercial potential, or result in significant negative consequences following any potential marketing approval.

Our product candidates that we are testing or may test in clinical trials, including EDIT-101 and EDIT-301, or that are developed may be associated with off-target editing or other serious adverse events, undesirable side effects, or unexpected characteristics.

In addition to serious adverse events or side effects caused by any product candidate we

develop and test, the administration process or related procedures also can cause undesirable side effects.

Our product candidates that we are testing or may test in clinical trials, including EDIT-301, or that are developed may be associated with off-target editing or other serious adverse events, undesirable side effects, or unexpected characteristics.

In addition to serious adverse events or side effects caused by any product candidate we develop and test, the administration process or related procedures also can cause undesirable side effects.

If any such events occur, our clinical trials could be suspended or terminated.

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Our proposed delivery modes, combined with our product candidates, have a limited history of being evaluated in human clinical trials.

Any of our product candidates, including EDIT-101 to treat LCA10, may fail to show the desired safety and efficacy in later stages of clinical development despite having successfully advanced through initial clinical trials.

Any of our product candidates, including EDIT-301 to treat SCD and TDT, may fail to show the desired safety and efficacy in later stages of clinical development despite having successfully advanced through initial clinical trials.

There is a high failure rate for drugs and biologics proceeding through clinical trials.

A number of companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in later stage clinical trials even after achieving promising results in earlier stage clinical trials.

For example, ProQR Therapeutics N.V.

recently announced its failure to meet the primary endpoint of its Phase 2/3 clinical trial to treat LCA10 despite previously announcing positive results observed in the Phase 1/2 portion of the clinical trial.

Data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit, or prevent regulatory approval.

In addition, regulatory delays or rejections may be encountered as a result of many factors, including changes in regulatory policy during the period of product development.

Any such adverse events may cause us to delay, limit, or terminate planned clinical trials, any of which would have a material adverse effect on our business, financial condition, results of operations, and prospects.

Any such adverse events may cause us to delay, limit, or terminate planned clinical trials, any of which would

have a material adverse effect on our business, financial condition, results of operations, and prospects.

Because we are developing product candidates for the treatment of diseases in which there is little clinical experience using new technologies, there is increased risk that the FDA, the EMA, or other regulatory authorities may not consider the endpoints of our clinical trials to provide clinically meaningful results and that these results may be difficult to analyze.

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● the number of patients required for clinical trials of any product candidates we develop may be larger than we anticipate;

enrollment of suitable participants in these clinical trials, which may be particularly challenging for some of the rare genetically defined diseases we are targeting in our most advanced programs, may be delayed or slower than we anticipate;

enrollment of suitable participants in these clinical trials may be delayed or slower than we anticipate;

or patients may drop out of these clinical trials at a higher rate than we anticipate;

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We or our collaborators may not be able to initiate or continue clinical trials for any of our product candidates if we are unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or analogous regulatory authorities outside the United States, or as needed to provide appropriate statistical power for a given trial.

Enrollment may be challenging for the rare genetically defined diseases we are targeting.

In addition, if patients are unwilling to participate in our genome editing trials because of negative publicity from adverse events related to the biotechnology, gene therapy, or genome editing fields, competitive clinical trials for similar patient populations, clinical trials in competing products, or for other reasons, the timeline for recruiting patients, conducting studies, and obtaining regulatory approval of any product candidates we develop may be delayed.

For example, the recent announcement by ProQR Therapeutics N.V.

of its failure to meet the primary endpoint of its Phase 2/3 clinical trial to treat LCA10 may result in reluctance of potential patients to enroll in other genome editing trials targeting LCA10, such as our ongoing Phase I/II clinical trial for EDIT-101.

Moreover, some of our competitors may have ongoing clinical trials for product candidates that would treat the same indications as any product candidates we develop, and patients who would otherwise be eligible for our clinical trials may instead enroll in clinical trials of our competitors’ product candidates.

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● proximity and availability of clinical trial sites for prospective patients.

In particular, EDIT-101 for the treatment of LCA10 has a limited patient pool from which to draw for enrollment in a clinical trial, as the global incidence of LCA10 is estimated to be two to three per 100,000 live births worldwide.

The eligibility criteria of our clinical trials further limits the pool of available trial participants.

Additionally, the process of finding and diagnosing patients may prove costly.

The COVID-19 pandemic, including related restrictions

imposed by regulatory authorities and constraints on healthcare provider capacity, has previously impacted and may in the future impact our ability to timely enroll trial participants and conduct our studies.

The COVID-19 pandemic, including related restrictions imposed by regulatory authorities and constraints on healthcare provider capacity, has previously impacted and may in the future impact our ability to timely enroll trial participants and conduct our studies.

Our ability to successfully initiate, enroll, and complete a clinical trial in any foreign country is subject to numerous risks unique to conducting business in foreign countries, including:

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Basic research on embryos is more tightly controlled in many other European countries.

Although we do not use our technologies to edit human embryos or the human germline, such public debate

about the use of genome editing technologies in human embryos and heightened regulatory scrutiny could prevent or delay our development of product candidates.

Although we do not use our technologies to edit human embryos or the human germline, such public debate about the use of genome editing technologies in human embryos and heightened regulatory scrutiny could prevent or delay our development of product candidates.

More restrictive government regulations or negative public opinion would have a negative effect on our business or financial condition and may delay or impair our development and commercialization of product candidates or demand for any products we may develop.

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We will face competition with respect to any of our product candidates now and in the future from major pharmaceutical companies, specialty pharmaceutical companies, and biotechnology companies worldwide.

Potential competitors also include academic institutions, government agencies, and other public and private research

organizations that conduct research, seek patent protection, and establish collaborative arrangements for research, development, manufacturing, and commercialization.

Potential competitors also include academic institutions, government agencies, and other public and private research organizations that conduct research, seek patent protection, and establish collaborative arrangements for research, development, manufacturing, and commercialization.

There are a number of large pharmaceutical and biotechnology companies that currently market and sell products or are pursuing the development of products for the treatment of the disease indications for which we have research programs.

Some of these competitive products and therapies are based on scientific approaches that are the same as or similar to our approach, and others are based on entirely different approaches.

Our platform and product focus is the development of therapies using CRISPR technology.

Other companies developing CRISPR Cas9 or Cas12a technology or therapies using CRISPR Cas9 or Cas12a technology include Caribou Biosciences, CRISPR Therapeutics, ERS Genomics, Intellia Therapeutics, ToolGen, Vertex Pharmaceuticals, and Verve Therapeutics.

Our platform and product focus is the development of therapies using CRISPR technology specifically for genome editing.

Other companies developing CRISPR Cas9 or Cas12a technology or therapies using CRISPR Cas9 or Cas12a technology include Artisan Bio, Caribou Biosciences, CRISPR Therapeutics, EdiGene, ERS Genomics, Excision Biotherapeutics, Graphite Bio, Inscripta, Intellia Therapeutics, Sigma-Aldrich, ToolGen, and Vertex Pharmaceuticals.

In addition, there have been and may continue to be discoveries of new CRISPR-based gene editing technologies.

There are additional companies developing therapies using related CRISPR genome editing technologies, including other CRISPR nucleases, base editing, prime editing and gene writing.

These companies include Arbor Biotechnologies, Beam Therapeutics, Chroma Medicine, KSQ Therapeutics, Locus Biosciences, Mammoth Biosciences, Metagenomi, Poseida Therapeutics, Prime Medicine, Scribe Therapeutics, Tessera Therapeutics, and Tune Therapeutics.

These companies include Arbor Biotechnologies, Beam Therapeutics, Chroma Medicine, Emendo Biotherapeutics, Integra Therapeutics, KSQ Therapeutics, Locus Biosciences, Mammoth Biosciences, Metagenomi, Poseida Therapeutics, Prime Medicine, Scribe Therapeutics, Tessera Therapeutics, Tome Biosciences, Tune Therapeutics, and Verve Therapeutics.

There are also companies developing therapies using transcription activator-like effector nucleases, meganucleases, Mega- TALs and zinc finger nucleases.

These companies include 2Seventy Bio, Allogene Therapeutics, bluebird bio, Cellectis, Precision Biosciences, and Sangamo Therapeutics.

Additional companies developing cell therapy products include Catamaran Bio, Celularity, Century Therapeutics, Cytovia Therapeutics, Fate Therapeutics, Graphite Bio, Nkarta, ONK Therapeutics, Shoreline Biosciences, and Wugen Therapeutics.

Additional companies developing gene therapy products include Abeona Therapeutics, Adverum Biotechnologies, AGTC Therapeutics, Astellas Gene Therapies, Generation Bio, Homology Medicines, REGENXBIO, Sarepta Therapeutics, Solid Biosciences, Spark Therapeutics, uniQure and Voyager Therapeutics.

In addition to competition from other genome editing therapies, gene therapies or cell medicine therapies, any products that we may develop may also face competition from other types of therapies, such as small molecule, antibody, protein, oligonucleotide, or ribonucleic acid therapies.

There are also companies developing therapies related to our development programs.

For hemoglobinopathies, these companies include Acceleron Pharma, Aruvant Therapeutics, Beam Therapeutics, bluebird bio, Cellectis, CRISPR Therapeutics, EdiGene, Global Blood Therapeutics, Graphite Bio, Intellia Therapeutics, Novartis Pharmaceuticals, Sangamo Therapeutics, and Vertex Pharmaceuticals.

Many of our competitors may have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals, and marketing approved products than we do.

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In many countries, the pricing review period begins after marketing or product licensing approval is granted.

foreign markets, prescription pharmaceutical pricing remains subject to continuing governmental control even after initial approval is granted.

In some foreign markets, prescription pharmaceutical pricing remains subject to continuing governmental control even after initial approval is granted.

As a result, we might obtain marketing approval for a medicine in a particular country, but then be subject to price regulations that delay our commercial launch of the medicine, possibly for lengthy time periods, and negatively impact the revenues we are able to generate from the sale of the medicine in that country.

Adverse pricing limitations may hinder our ability to recoup our investment in one or more product candidates, even if any of our product candidates obtain marketing approval.

Our ability to commercialize any medicines successfully also will depend in part on the extent to which reimbursement for these medicines and related treatments will be available from government health administration authorities, private health insurers, and other organizations.

Our ability to commercialize any medicines successfully also will depend in part on the extent to which

reimbursement for these medicines and related treatments will be available from government health administration authorities, private health insurers, and other organizations.

Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which medications they will pay for and establish reimbursement levels.

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Government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications.

For example, the Inflation Reduction Act of 2022 (the “IRA”) includes several measures intended to lower the cost of prescription drugs and related healthcare reforms, including limits on price increases and subjecting an escalating number of drugs to annual price negotiations with The Centers for Medicare & Medicaid Services.

We cannot be sure whether additional legislation or rulemaking related to the IRA will be issued or enacted, or what impact, if any, such changes will have on the profitability of any of our drug candidates, if approved for commercial use, in the future.

Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products.

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Due to the novel nature of our technology and the potential for some of our product candidates to offer therapeutic benefit in a single administration or limited number of administrations, we face uncertainty related to pricing and reimbursement for these product candidates.

Our initial target patient populations for some of our programs are relatively small, as a result of which the pricing and reimbursement of any of our product candidates, if approved, must be adequate to support the necessary commercial infrastructure.

The pricing and reimbursement of any of our product candidates, if approved, must be adequate to support the necessary commercial infrastructure.

If we are unable to obtain adequate levels of reimbursement, our ability to successfully market and sell any such product candidates will be adversely affected.

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We expect that coverage and reimbursement by government and private payors will be essential for most patients to be able to afford these treatments.

Accordingly, sales of any such product candidates will

depend substantially, both domestically and abroad, on the extent to which the costs of any product candidates we develop will be paid by health maintenance, managed care, pharmacy benefit, and similar healthcare management organizations, or will be reimbursed by government authorities, private health coverage insurers, and other third-party payors.

Coverage and reimbursement by a third-party payor may depend upon several factors, including the third-party payor’s determination that use of a product is:

Accordingly, sales of any such product candidates will depend substantially, both domestically and abroad, on the extent to which the costs of any product candidates we develop will be paid by health maintenance, managed care, pharmacy benefit, and similar healthcare management organizations, or will be reimbursed by government authorities, private health coverage insurers, and other third-party payors.

Coverage and reimbursement by a third-party payor may depend upon several factors, including the third-party

payor’s determination that use of a product is:

● a covered benefit under its health plan;

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If the market opportunities for any of our product candidates are smaller than we believe they are, our revenues may be adversely affected, and our business may suffer.

Because the target patient populations for some of the product candidates we develop are small, we must be able to successfully identify patients and achieve a significant market share to maintain profitability and growth.

Some of our most advanced programs, including EDIT-101, focus on treatments for rare genetically defined diseases.

If the target patient population for a product candidate we develop is small, we will need to successfully identify patients and achieve a significant market share to maintain profitability and growth.

Some of our programs may focus on treatments for rare genetically defined diseases.

Our projections of both the number of people who have these diseases, as well as the subset of people with these diseases who have the potential to benefit from treatment with our product candidates, are based on estimates.

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Problems with the manufacturing process, even minor deviations from the normal process, could result in product defects or manufacturing failures that result in lot failures, product recalls, product liability claims, or insufficient inventory.

If we successfully

develop product candidates, we may encounter problems achieving adequate quantities and quality of clinical-grade materials that meet FDA, EMA or other comparable applicable foreign standards or specifications with consistent and acceptable production yields and costs.

If we successfully develop product candidates, we may encounter problems achieving adequate quantities and quality of clinical-grade materials that meet FDA, EMA or other comparable applicable foreign standards or specifications with consistent and acceptable production yields and costs.

In addition, the FDA, the EMA, and other regulatory authorities may require us to submit samples of any lot of any approved product together with the protocols showing the results of applicable tests at any time.

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● Collaborators may have significant discretion in determining the efforts and resources that they will apply to these collaborations.

● Collaborators may not pursue development and commercialization of any product candidates we develop or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborator’s strategic focus or available funding or external factors such as an acquisition that diverts resources or creates competing priorities.

results, changes in the collaborator’s strategic focus or available funding or external factors such as an acquisition that diverts resources or creates competing priorities.

● Collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials, or require a new formulation of a product candidate for clinical testing.

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We face significant competition in seeking appropriate collaborators.

Whether we reach a definitive agreement for a collaboration will depend, among other things, upon our assessment of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration, and the proposed collaborator’s evaluation of a number of factors.

Whether we reach a definitive agreement

for a collaboration will depend, among other things, upon our assessment of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration, and the proposed collaborator’s evaluation of a number of factors.

Those factors may include the design or results of clinical trials, the likelihood of approval by the FDA or similar regulatory authorities outside the United States, the potential market for the subject product candidate, the costs and complexities of manufacturing and delivering such product candidate to patients, the potential of competing products, the existence of uncertainty with respect to our ownership of technology, which can exist if there is a challenge to such ownership without regard to the merits of the challenge, and industry and market conditions generally.

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We may also be restricted under existing collaboration agreements from entering into future agreements on certain terms with potential collaborators or allies.

For example, under our amended and restated collaboration with Juno Therapeutics, we may not use directly or indirectly, or license others to use, genome editing technology in connection with any research, development, manufacture, commercialization or other exploration of certain T cells, subject to certain exceptions, as more fully described in “Part I—Business—Our Collaborations and Licensing Strategy” of this Annual Report on Form 10-K.

For example, under our amended and restated collaboration with BMS, we may not use directly or indirectly, or license others to use, genome editing technology in connection with any research, development, manufacture, commercialization or other exploration of certain T cells, subject to certain exceptions, as more fully described in “Part I—Business—Our Collaborations and Licensing Strategy” of this Annual Report on Form 10-K.

Collaborations are also complex and time-consuming to negotiate and document.

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If we need to enter into alternative arrangements, our product development activities would be delayed.

Additionally, the activities performed by these third parties may be delayed or suspended in light of the ongoing COVID-19 pandemic, which may impact our ability to successfully develop and test our product candidates and research programs in a timely manner.

Our reliance on these third parties for research and development activities will reduce our control over these activities but will not relieve us of our responsibilities.

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Furthermore, these third parties may also have relationships with other entities, some of which may be our competitors.

If these third parties do not successfully carry out their contractual duties, meet expected deadlines, or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed in obtaining, marketing approvals for any product candidates we develop and will not be able

to, or may be delayed in our efforts to, successfully commercialize our medicines.

We also expect to rely on other third parties to store and distribute drug supplies for our clinical trials.

Any performance failure on the part of our distributors could delay clinical development or marketing approval of any product candidates we develop or commercialization of our medicines, producing additional losses and depriving us of potential product revenue.

performance failure on the part of our distributors could delay clinical development or marketing approval of any product candidates we develop or commercialization of our medicines, producing additional losses and depriving us of potential product revenue.

We contract with third parties for the manufacture of materials for our research programs, preclinical studies and clinical trials and expect to continue to do so and for commercialization of any product candidates that we develop.

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We primarily rely on third-party contract manufacturing organizations (“CMOs”) for the manufacture of our materials for preclinical and clinical studies and expect to continue to do so and for commercial supply of any product candidates that we develop and for which we or our collaborators obtain marketing approval.

Additionally, the activities performed by our CMOs may be delayed or suspended in light of the ongoing COVID-19 pandemic, which may impact our ability to successfully develop and test our product candidates, including in clinical trials, and research programs in a timely manner.

Even though we have established supply agreements with third-party manufacturers, reliance on third-party manufacturers entails additional risks, including:

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Our success depends in large part on our ability to obtain and maintain patent protection in the United States and other countries with respect to our CRISPR platform technology and any proprietary product candidates and technology we develop.

We seek to protect our proprietary position by in-licensing intellectual property relating to our

platform technology and filing patent applications in the United States and abroad related to our technologies and product candidates that are important to our business.

We seek to protect our proprietary position by in-licensing intellectual property relating to our platform technology and filing patent applications in the United States and abroad related to our technologies and product candidates that are important to our business.

If we or our licensors and/or collaborators are unable to obtain or maintain patent protection with respect to our CRISPR platform technology and any proprietary products and technology we develop, our business, financial condition, results of operations, and prospects could be materially harmed.

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Moreover, some of our owned and in-licensed patents and patent applications are, and may in the future be, co-owned with third parties.

If we are unable to obtain an exclusive license to any such third party co-owners’ interest in such patents or patent applications, such co-owners may be able to license their rights to other third parties, including our competitors, and our competitors could market competing products and technology.

If we are unable to obtain an exclusive license to

any such third party co-owners’ interest in such patents or patent applications, such co-owners may be able to license their rights to other third parties, including our competitors, and our competitors could market competing products and technology.

In addition, we or our licensors may need the cooperation of any such co-owners of our owned and in-licensed patents in order to enforce such patents against third parties, and such cooperation may not be provided to us or our licensors.

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Broad does not and does not purport to grant any rights in NIH’s interest in these patent applications under our agreement.

If other third parties have ownership rights to our in-licensed patents and patent applications, they may be able to license such patents and patent applications to our

competitors, and our competitors could market competing products and technology.

If other third parties have ownership rights to our in-licensed patents and patent applications, they may be able to license such patents and patent applications to our competitors, and our competitors could market competing products and technology.

This could have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects.

Some of our in-licensed patents are subject to priority and validity disputes.

In addition, our owned and in-licensed patents, patent applications and other intellectual property may be subject to further priority and validity disputes, and other similar intellectual property proceedings including inventorship disputes.

In addition, our owned and in-licensed patents, patent applications and other intellectual property may be subject to further priority and validity disputes,

and other similar intellectual property proceedings including inventorship disputes.

If we or our licensors are unsuccessful in any of these proceedings, we may be required to obtain licenses from third parties, which may not be available on commercially reasonable terms or at all, or to cease the development, manufacture, and commercialization of one or more of the product candidates we develop, which could have a material adverse impact on our business.

patents and a U.S.

patent application directed to CRISPR/Cas9 that are co-owned by the Broad and the Massachusetts Institute of Technology (“MIT”), and in some cases Harvard (collectively referred to as “Broad”), and in-licensed by us were involved in a first interference with a U.S.

patent application directed to CRISPR/Cas9 that are co-owned by the Broad Institute and the Massachusetts Institute of Technology (“MIT”), and in some cases Harvard (collectively referred to as “Broad”), and in-licensed by us were involved in a first interference with a U.S.

patent application that is co-owned by the University of California, the University of Vienna, and Emmanuelle Charpentier (collectively referred to “CVC”).

An interference is a proceeding in the USPTO before the Patent Trial and Appeal Board of the USPTO (“PTAB”) to determine priority of invention of the subject matter of patent claims filed by different parties.

An interference is a proceeding in United States Patent and Trademark Office (the “USPTO”) before the Patent Trial and Appeal Board of the USPTO (“PTAB”) to determine priority of invention of the subject matter of patent claims filed by different parties.

In this first interference, the PTAB made a judgment of no interference-in-fact in favor of the Broad, which was upheld on appeal.

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As a result, Broad entered the priority phase of the interference as “Senior Party” while CVC remained the “Junior Party” for purposes of determining which entity was the first to invent the inventions at issue.

We cannot predict with any certainty how long it will take before the PTAB issues a decision at the conclusion of the priority phase.

On February 28, 2022, the PTAB issued a decision regarding the priority phase of the interference determining that Broad was the first entity to invent the claims at issue.

This decision has been appealed by CVC and the Broad has cross-appealed.

It is uncertain when or in what manner the U.S.

Court of Appeals for the Federal Circuit will act on these appeals.

On December 14, 2020, the PTAB, declared two new interferences involving a pending U.S.

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The claims in ToolGen’s patent application relate to a mammalian cell with a CRISPR/Cas system comprising a codon optimized nucleic acid encoding a Cas9 polypeptide with a nuclear localization signal and a single-molecule guide RNA that, together, are capable of forming a Cas9/RNA complex that mediates double stranded cleavage of a target nucleic acid sequence.

On June 21, 2021, the PTAB declared two new patent interferences involving a pending U.S.

On September 28, 2022, the PTAB suspended both of these interferences until the U.S.

Court of Appeals for the Federal Circuit issues a mandate in the pending appeals related to the second interference between Broad and CVC.

On June 21, 2021, the PTAB declared two new interferences involving a pending U.S.

patent application owned by Sigma-Aldrich (the “Sigma-Aldrich application”).

One of the two new patent interferences is between the Sigma-Aldrich application and certain U.S.

One of the two new interferences is between the Sigma-Aldrich application and certain U.S.

patents and U.S.

patent applications that are co-owned by Broad and in-licensed by us.

The second new patent interference is between the same Sigma-Aldrich application and the U.S.

The other Sigma interference is between the same Sigma-Aldrich application and the U.S.

patent applications that are co-owned by CVC.

Most of the Broad U.S.

patents and patent applications that are involved in the

interference with Sigma-Aldrich are also part of the concurrent interferences with CVC and ToolGen.

The claims in Sigma-Aldrich’s application relate to a method for modifying a chromosomal sequence in a eukaryotic cell by integrating a donor sequence into that chromosomal sequence.

patents and patent applications that are involved in the interference with Sigma-Aldrich are also part of the concurrent interferences with CVC and ToolGen.

The claims in Sigma-Aldrich’s application relate to a method for modifying a chromosomal sequence in a eukaryotic cell by integrating a donor sequence into that

chromosomal sequence.

These methods use a CRISPR/Cas9 system comprising a Cas9 polypeptide with a nuclear localization signal, a guide RNA, and a donor sequence that, together, are capable of mediating double stranded cleavage and repair of a target nucleic acid sequence leading to integration of the donor sequence into the chromosomal sequence.

On December 14, 2022, the PTAB suspended both of these interferences until the U.S.

Court of Appeals for the Federal Circuit issues a mandate in the pending appeals related to the second interference between Broad and CVC.

As a result of these declarations of interference, five parallel adversarial proceedings in the USPTO before the PTAB have been initiated – the patent interferences between Broad and CVC, Broad and ToolGen, CVC and ToolGen, Broad and Sigma-Aldrich, and CVC and Sigma-Aldrich.

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The Opposition Division has also initiated opposition proceedings against certain other European patents that we have in-licensed from Broad.

The EPO opposition proceedings may involve issues including, but not limited to, procedural formalities related to filing the European patent application, priority, and the patentability of the involved claims.

The European Patent Office opposition proceedings may involve issues including, but not limited to, procedural formalities related to filing the European patent application, priority, and the patentability of the involved claims.

In view of certain arguments made by the third parties against the revoked patents and similar arguments made by the third parties against other in-licensed European patents under opposition, the opposition proceedings may lead to the revocation of certain additional in-licensed European patents.

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If we or our licensors are unsuccessful in any patent related disputes, including interference proceedings, patent oppositions, re-examinations, or other priority, inventorship, or validity disputes to which we or they are subject (including any of the proceedings discussed above), we may lose valuable intellectual property rights through the loss of one or more patents owned or licensed or our owned or licensed patent claims may be narrowed, invalidated, or held unenforceable.

In addition, if we or our licensors are unsuccessful in any inventorship disputes to which we or they are

subject, we may lose valuable intellectual property rights, such as exclusive ownership of, or the exclusive right to use, our owned or in-licensed patents and patent applications.

In addition, if we or our licensors are unsuccessful in any inventorship disputes to which we or they are subject, we may lose valuable intellectual property rights, such as exclusive ownership of, or the exclusive right to use,

our owned or in-licensed patents and patent applications.

If we or our licensors are unsuccessful in any interference proceeding or other priority or inventorship dispute, we may be required to obtain and maintain licenses from third parties, including parties involved in any such interference proceedings or other priority or inventorship disputes.

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Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by government patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.

Periodic maintenance fees, renewal fees, annuity fees, and various other government fees on patents and applications will be due to be paid to the USPTO and various government patent agencies outside of the United States

over the lifetime of our owned or licensed patents and applications.

In certain circumstances, we rely on our licensing partners to pay these fees due to U.S.

In certain circumstances, we rely on our licensing

partners to pay these fees due to U.S.

patent agencies.

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In addition, the agreements under which we currently license intellectual property or technology from third parties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations.

obligations under the relevant agreement, including the amount, if any, that may become due and payable to our licensors in connection with sublicense income.

The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement, including the amount, if any, that may become due and payable to our

licensors in connection with sublicense income.

If these events were to occur, they could have a material adverse effect on our business, financial condition, results of operations, and prospects.

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There may be significant intellectual property related litigation and proceedings relating to our owned and in-licensed, and other third party, intellectual property and proprietary rights in the future.

Our commercial success depends upon our ability and the ability of our collaborators to develop, manufacture, market, and sell any product candidates that we develop and use our proprietary technologies without infringing, misappropriating, or otherwise violating the intellectual property and proprietary rights of third parties.

Our commercial success depends upon our ability and the ability of our collaborators to develop, manufacture,

market, and sell any product candidates that we develop and use our proprietary technologies without infringing, misappropriating, or otherwise violating the intellectual property and proprietary rights of third parties.

We are subject to and may in the future become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our technology and any product candidates we develop, including interference, re-examination, post-grant review, inter partes review, and derivation proceedings before the USPTO and similar proceedings in foreign jurisdictions such as oppositions before the EPO.

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If we are unable to obtain patent term extension or if the term of any such extension is less than we request, we will be unable to rely on our patent position to forestall the marketing of competing products following our patent expiration, and it could have a materially adverse effect on our business, financial condition, results of operations, and prospects.

We may be subject to claims that our employees, consultants, or advisors have wrongfully used or disclosed alleged trade secrets of their current or former employers or claims asserting ownership of what we regard as our own intellectual property.

We may be subject to claims that our employees, consultants, or advisors have wrongfully used or disclosed alleged

trade secrets of their current or former employers or claims asserting ownership of what we regard as our own intellectual property.

Many of our employees, consultants, and advisors are currently or were previously employed at universities or other biotechnology or pharmaceutical companies, including our competitors or potential competitors.

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The Hatch-Waxman Amendments permit a patent extension term of up to five years as compensation for patent term lost during the FDA regulatory review process.

A patent term extension cannot extend the remaining term of a patent beyond a total of

14 years from the date of product approval, only one patent may be extended and only those claims covering the approved drug, a method for using it, or a method for manufacturing it may be extended.

A patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval, only one patent may be extended and only those claims covering the

approved drug, a method for using it, or a method for manufacturing it may be extended.

However, we may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents, or otherwise failing to satisfy applicable requirements.

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We may seek certain designations for our product candidates, including Breakthrough Therapy, Fast Track and Priority Review designations in the US, and PRIME Designation in the EU, but we might not receive such designations, and even if we do, such designations may not lead to a faster development or regulatory review or approval process.

We may seek certain designations for one or more of our product candidates that could expedite review and

approval by the FDA.

A Breakthrough Therapy product is defined as a product that is intended, alone or in combination with one or more other products, to treat a serious condition, and preliminary clinical evidence indicates that the product may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.

We may seek certain designations for one or more of our product candidates that could expedite review and approval by the FDA.

A Breakthrough Therapy product is defined as a product that is intended, alone or in combination

with one or more other products, to treat a serious condition, and preliminary clinical evidence indicates that the product may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development.

For products that have been designated as Breakthrough Therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens.

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The Biologics Price Competition and Innovation Act of 2009, (“BPCIA”), was enacted as part of the Patient Protection and Affordable Care Act, (“ACA”), to establish an abbreviated pathway for the approval of biosimilar and interchangeable biological products.

The regulatory pathway establishes legal authority for the FDA to review and approve biosimilar biologics, including the possible designation of a biosimilar as “interchangeable” based on its

similarity to an approved biologic.

Under the BPCIA, a reference biological product is granted 12 years of data exclusivity from the time of first licensure of the product, and the FDA will not accept an application for a biosimilar or interchangeable product based on the reference biological product until four years after the date of first licensure of the reference product In addition, the licensure of a biosimilar product may not be made effective by the FDA until 12 years from the date on which the reference product was first licensed.

The regulatory pathway establishes legal authority for the FDA to review and approve biosimilar biologics, including the possible designation of a biosimilar as “interchangeable” based on its similarity to an approved biologic.

Under the BPCIA, a reference biological product is granted 12 years of data

exclusivity from the time of first licensure of the product, and the FDA will not accept an application for a biosimilar or interchangeable product based on the reference biological product until four years after the date of first licensure of the reference product In addition, the licensure of a biosimilar product may not be made effective by the FDA until 12 years from the date on which the reference product was first licensed.

During this 12-year period of exclusivity, another company may still develop and receive approval of a competing biologic, so long as its BLA does not reply on the reference product, sponsor’s data or submit the application as a biosimilar application.

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On August 3, 2017, Congress passed the FDA Reauthorization Act of 2017 (“FDARA”).

FDARA, among other things, codified the FDA’s pre-existing regulatory interpretation, to require that a drug sponsor demonstrate the clinical superiority of an orphan drug that is otherwise the same as a previously approved drug for the same rare disease in order

to receive orphan drug exclusivity.

The new legislation reverses prior precedent holding that the Orphan Drug Act unambiguously requires that the FDA recognize the orphan exclusivity period regardless of a showing of clinical superiority.

The new legislation reverses prior precedent holding that the Orphan Drug Act

unambiguously requires that the FDA recognize the orphan exclusivity period regardless of a showing of clinical superiority.

Further, under Omnibus legislation signed by President Trump on December 27, 2020, the requirement for a product to show clinical superiority applies to drugs and biologics that received orphan drug designation before enactment of FDARA in 2017, but have not yet been approved or licensed by the FDA.

The FDA may further reevaluate the Orphan Drug Act and its regulations and policies.

This may be particularly true in light of a decision from the Court of Appeals for the 11th Circuit in September 2021 finding that, for the purpose of determining the scope of exclusivity, the term “same disease or condition” means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” Thus, the court concluded, orphan drug exclusivity applies to the entire designated disease or condition rather than the “indication or use.” We do not know if, when, or how the FDA may change the orphan drug regulations and policies in the future, and it is uncertain how any changes might affect our business.

This may be particularly true in light of a decision from the Court of Appeals for the 11th Circuit in September 2021 finding that, for the purpose of determining the scope of exclusivity, the term “same disease or condition” means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” Thus, the court concluded, orphan drug exclusivity applies to the entire designated disease or condition rather than the “indication or use.” Although there have been legislative proposals to overrule this decision, they have not been enacted into law.

On January 23, 2023, FDA announced that, in matters beyond the scope of that court order, FDA will continue to apply its existing regulations tying orphan-drug exclusivity to the uses or indications for which the orphan drug was approved.

We do not know if, when, or how the FDA may change the orphan drug regulations and policies in the future, and it is uncertain how any changes might affect our business.

Depending on what changes the FDA may make to its orphan drug regulations and policies, our business could be adversely impacted.

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We may not be able to file for marketing approvals and may not receive necessary approvals to commercialize our medicines in any jurisdiction, which would materially impair our ability to generate revenue.

Additionally, the United Kingdom left the European Union on January 31, 2020, commonly referred to as Brexit, and a transition period to December 31, 2020, was established to allow the United Kingdom and the European Union to negotiate the United Kingdom’s withdrawal.

As a result, effective January 1, 2021, the United Kingdom is no longer part of the European Single Market and European Union Customs Union.

A co-operation agreement was signed between the United Kingdom and the European Union in December 2020, which was applied provisionally beginning on January 1, 2021 and entered into force on May 1, 2021.

Additionally, the United Kingdom left the European Union on January 31, 2020, commonly referred to as Brexit, and, effective January 1, 2021, the United Kingdom ceased to be part of the European Single Market and European Union Customs Union.

A co-operation agreement was signed between the United Kingdom and the European Union in December 2020, which entered into force on May 1, 2021.

The agreement addresses trade, economic arrangements, law enforcement, judicial cooperation and a governance framework including procedures for dispute resolution, among other things.

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The HMR has incorporated into the domestic law of the body of European Union law instruments governing medicinal products that pre-existed prior to the United Kingdom’s withdrawal from the European Union.

Any delay in obtaining, or an inability to obtain, any marketing approvals, as a result of Brexit or otherwise, may force us to restrict or delay efforts to seek regulatory approval in the United Kingdom for our product candidates, which could significantly and materially harm our business.

Any delay in obtaining, or an inability to obtain, any marketing approvals, as a result of Brexit or otherwise, may force us to restrict or delay efforts to seek regulatory approval in the

United Kingdom for our product candidates, which could significantly and materially harm our business.

We expect that we will be subject to additional risks in commercializing any of our product candidates that receive marketing approval outside the United States, including tariffs, trade barriers and regulatory requirements;

economic weakness, including inflation, or political instability in particular foreign economies and markets (such as the ongoing conflict between Ukraine and Russia);

compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;

foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country;

and workforce uncertainty in countries where labor unrest is more common than in the United States.

Even if we, or any collaborators we may have, obtain marketing approvals for any of our product candidates, the terms of approvals and ongoing regulation of our products could require the substantial expenditure of resources and may limit how we, or they, manufacture and market our products, which could materially impair our ability to generate revenue.

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If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Further, future government shutdowns could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

Separately, in response to the COVID-19 pandemic, since March 2020 when foreign and domestic inspections of facilities were largely placed on hold, the FDA has been working to resume routine surveillance, bioresearch monitoring and pre-approval inspections on a prioritized basis.

The FDA has developed a rating system to assist in determining when and where it is safest to conduct prioritized domestic inspections.

As of May 2021, certain inspections, such as foreign preapproval, surveillance, and for-cause inspections that are not deemed mission-critical, remain temporarily postponed.

In April 2021, the FDA issued guidance for industry formally announcing plans to employ remote interactive evaluations, using risk management methods, to meet user fee commitments and goal

dates and in May 2021 announced plans to continue progress toward resuming standard operational levels.

Should FDA determine that an inspection is necessary for approval and an inspection cannot be completed during the review cycle due to restrictions on travel, and the FDA does not determine a remote interactive evaluation to be adequate, the FDA has stated that it generally intends to issue a complete response letter or defer action on the application until an inspection can be completed.

In 2020 and 2021, a number of companies announced receipt of complete response letters due to the FDA’s inability to complete required inspections for their applications.

Further, future

government shutdowns could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

Separately, in response to the COVID-19 pandemic, a number of companies announced in 2020 and 2021 that they had received complete response letters due to the FDA’s inability to complete required inspections for their applications.

As of May 26, 2021, the FDA noted it was continuing to ensure timely reviews of applications for medical products during the ongoing COVID-19 pandemic in line with its user fee performance goals and conducting mission critical domestic and foreign inspections to ensure compliance of manufacturing facilities with FDA quality standards.

However, the FDA may not be able to continue its current pace and review timelines could be extended, including where a pre-approval inspection or an inspection of clinical sites is required and due to the ongoing COVID-19 pandemic and travel restrictions, the FDA is unable to complete such required inspections during the review period.

However, the FDA may not be able to continue its current pace and review timelines could be extended, thus the FDA may be unable to complete such required inspections during the review period.

Regulatory authorities outside the U.S.

may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic and may experience delays in their regulatory activities.

may experience delays in their regulatory activities.

If a prolonged government shutdown or other disruption occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

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● the federal false statements statute, which prohibits knowingly and willfully falsifying, concealing, or covering up a material fact or making any materially false statement in connection with the delivery of or payment for healthcare benefits, items, or services;

Human Services information related to payments and other transfers of value to physicians, other healthcare providers and teaching hospitals, and ownership and investment interests held by physicians, other healthcare providers and other healthcare providers and their immediate family members and applicable group purchasing organizations;

● the federal transparency requirements under the federal Physician Payment Sunshine Act, which requires manufacturers of drugs, devices, biologics, and medical supplies to report to the Department of Health and Human Services information related to payments and other transfers of value to physicians, other

healthcare providers and teaching hospitals, and ownership and investment interests held by physicians and their immediate family members and applicable group purchasing organizations;

● analogous state laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers, and certain state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring drug manufacturers to report information related to payments to physicians and other health care providers or marketing expenditures.

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Liabilities they incur pursuant to these laws could result in significant costs or an interruption in operations, which could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Recently enacted and future legislation may increase the difficulty and cost for us and any future collaborators to obtain marketing approval of and commercialize our product candidates and affect the prices we, or they, may obtain.

Enacted and future legislation may increase the difficulty and cost for us and any future collaborators to obtain marketing approval of and commercialize our product candidates and affect the prices we, or they, may obtain.

In the United States and some foreign jurisdictions, there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could, among other things, prevent or delay marketing approval of our product candidates, restrict or regulate post-approval activities and affect our ability, or the ability of any future collaborators, to profitably sell any products for which we, or they, obtain marketing approval.

We expect that current laws, as well as other healthcare reform measures that may be adopted in the future, may result in more rigorous coverage criteria and in additional downward pressure on the price that we, or any future collaborators,

may receive for any approved products.

In March 2010, President Obama signed into law the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act (collectively the “ACA”).

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These changes included aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2031 under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”).

Pursuant to subsequent legislation, however, these Medicare sequester reductions have been suspended through the end of March 2022.

From April 2022 through June 2022 a 1% sequester cut will be in effect, with the full 2% cut resuming thereafter.

Pursuant to subsequent legislation, however, these Medicare sequester reductions were suspended and reduced through the end of June 2022 , with the full 2% cut resuming thereafter.

The American Taxpayer Relief Act of 2012, among other things, reduced Medicare payments to several providers and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

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District Court judge in the Northern District of Texas ruled that the individual mandate portion of the ACA is an essential and inseverable feature of the ACA and therefore because the mandate was repealed as part of the TCJA, the remaining provisions of the ACA are invalid as well.

Supreme Court heard this case on November 10, 2020 and on June 17, 2021, dismissed this action after finding that the plaintiffs do not have standing to challenge the constitutionality of the ACA.

In June 2021, the U.S.

Supreme Court dismissed this action after finding that the plaintiffs did not have standing to challenge the constitutionality of the ACA.

Litigation and legislation over the ACA are likely to continue, with unpredictable and uncertain results.

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In 2020, President Trump issued several executive orders intended to lower the costs of prescription products and certain provisions in these orders have been incorporated into regulations.

These regulations include an interim final rule implementing a most favored nation model for prices that would tie Medicare Part B payments for certain

physician-administered pharmaceuticals to the lowest price paid in other economically advanced countries, effective January 1, 2021.

These regulations include an interim final rule implementing a most favored nation model for prices that would tie Medicare Part B payments for certain physician-administered pharmaceuticals to the lowest price paid in other economically advanced countries, effective January 1, 2021.

That rule, however, has been subject to a nationwide preliminary injunction and, on December 29, 2021, CMS issued a final rule to rescind it.

With issuance of this rule, CMS stated that it will explore all options to incorporate value into payments for Medicare Part B pharmaceuticals and improve beneficiaries' access to evidence-based care.

With issuance of this rule, CMS stated that it will explore all options to

incorporate value into payments for Medicare Part B pharmaceuticals and improve beneficiaries' access to evidence-based care.

In addition, in October 2020, HHS and the FDA published a final rule allowing states and other entities to develop a Section 804 Importation Program, or SIP, to import certain prescription drugs from Canada into the United States.

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Further, on November 20, 2020, HHS finalized a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law.

The implementation of the rule has been delayed by the Biden administration from January 1, 2022 to January 1, 2023 in response to ongoing litigation.

The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a new safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers, the implementation of which have also been delayed by the Biden administration until January 1, 2023.

The implementation of the rule has been delayed by the Infrastructure Investment and Jobs Act to January 1, 2026 in response to ongoing litigation.

The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a new safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers, the implementation of which has been delayed until January 1, 2026 by the Infrastructure Investment and Jobs Act.

On July 9, 2021, President Biden signed Executive Order 14063, which focuses on, among other things, the price of pharmaceuticals.

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and (c) foster scientific innovation to promote better healthcare and improve health by supporting public and private research and making sure that market incentives promote discovery of valuable and accessible new treatments.

More recently, on August 16, 2022, the Inflation Reduction Act of 2022, or IRA, was signed into law by President Biden.

The new legislation has implications for Medicare Part D, which is a program available to individuals who are entitled to Medicare Part A or enrolled in Medicare Part B to give them the option of paying a monthly premium for outpatient prescription drug coverage.

Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap;

imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023);

and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).

The IRA permits the Secretary of the Department of Health and Human Services (HHS) to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

Specifically, with respect to price negotiations, Congress authorized Medicare to negotiate lower prices for certain costly single-source drug and biologic products that do not have competing generics or biosimilars and are reimbursed under Medicare Part B and Part D.

CMS may negotiate prices for ten high-cost drugs paid for by Medicare Part D starting in 2026, followed by 15 Part D drugs in 2027, 15 Part B or Part D drugs in 2028, and 20 Part B or Part D drugs in 2029 and beyond.

This provision applies to drug products that have been approved for at least 9 years and biologics that have been licensed for 13 years, but it does not apply to drugs and biologics that have been approved for a single rare disease or condition.

Nonetheless, since CMS may establish a maximum price for these products in price negotiations, we would be fully at risk of government action if our products are the subject of Medicare price negotiations.

Moreover, given the risk that could be the case, these provisions of the IRA may also further heighten the risk that we would not be able to achieve the expected return on our drug products or full value of our patents protecting our products if prices are set after such products have been on the market for nine years.

Further, the legislation subjects drug manufacturers to civil monetary penalties and a potential excise tax for failing to comply with the legislation by offering a price that is not equal to or less than the negotiated “maximum fair price” under the law or for taking price increases that exceed inflation.

The legislation also requires manufacturers to pay rebates for drugs in Medicare Part D whose price increases exceed inflation.

The new law also caps Medicare out-of-pocket drug costs at an estimated $4,000 a year in 2024 and, thereafter beginning in 2025, at $2,000 a year.

At the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

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These laws and regulations restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs, and other business arrangements.

Such misconduct also could involve the improper use of information obtained in the course of clinical trials or interactions with the FDA or other regulatory authorities, which

could result in regulatory sanctions and cause serious harm to our reputation.

Such misconduct also could involve the improper use of information obtained in the course of clinical trials or interactions with the FDA or other regulatory authorities, which could result in regulatory sanctions and cause serious harm to our reputation.

We have adopted a code of conduct applicable to all of our employees, but it is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from government investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations.

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In addition, the FCPA presents particular challenges in the pharmaceutical industry, because, in many countries, hospitals are operated by the government, and doctors and other hospital employees are considered foreign officials.

Certain payments to hospitals in connection with clinical trials and other work have been deemed to be improper payments to government officials and have led to FCPA enforcement actions.

Certain payments to hospitals in connection with clinical trials and other work have been deemed to be

improper payments to government officials and have led to FCPA enforcement actions.

Various laws, regulations and executive orders also restrict the use and dissemination outside of the United States, or the sharing with certain non-U.S.

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We are subject to stringent privacy laws, information security laws, regulations, policies and contractual obligations related to data privacy and security and changes in such laws, regulations, policies, contractual obligations and failure to comply with such requirements could subject us to significant fines and penalties, which may have a material adverse effect on our business, financial condition or results of operations.

the privacy, security and transmission of personal information, including comprehensive regulatory systems in the U.S., EU and U.K.

We are subject to data privacy and protection laws and regulations that apply to the collection, transmission, storage and use of personally-identifying information, which among other things, impose certain requirements relating to the privacy, security and transmission of personal information, including comprehensive regulatory systems in the U.S., EU and UK.

The legislative and regulatory landscape for privacy and data protection continues to evolve in jurisdictions worldwide, and there has been an increasing focus on privacy and data protection issues with the potential to affect our business.

Failure to comply with any of these laws and regulations could result in enforcement action against us, including fines, imprisonment of company officials and public censure, claims for damages by affected individuals, damage to our reputation and loss of goodwill, any of which could have a material adverse effect on our business, financial condition, results of operations or prospects.

Failure to comply with any of these laws and regulations could result in enforcement action against us, including fines, claims for damages by affected individuals, damage to our reputation and loss of goodwill, any of which could have a material adverse effect on our business, financial condition, results of operations or prospects.

There are numerous U.S.

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In addition to the risks associated with enforcement activities and potential contractual liabilities, our ongoing efforts to comply with evolving laws and regulations at the federal and state level may be costly and require ongoing modifications to our policies, procedures and systems.

In 2018, California passed into law the California Consumer Privacy Act (CCPA), which took effect on January 1, 2020 and imposed many requirements on businesses that process the personal information of California residents.

Many of the CCPA’s requirements are similar to those found in the GDPR, including requiring businesses to provide notice to data subjects regarding the information collected about them and how such information is used and shared, and providing data subjects the right to request access to such personal information and, in certain cases, request the erasure of such personal information.

In 2018, California passed into law the California Consumer Privacy Act (the “CCPA”), which took effect on January 1, 2020 and imposed many requirements on businesses that process the personal information of California residents.

Many of the CCPA’s requirements are similar to those found in the General Data Protection Regulation (the “GDPR”), including requiring businesses to provide notice to data subjects regarding the information collected about

them and how such information is used and shared, and providing data subjects the right to request access to such personal information and, in certain cases, request the erasure of such personal information.

The CCPA also affords California residents the right to opt-out of “sales” of their personal information.

The CCPA contains significant penalties for companies that violate its requirements.

On November 3, 2020, California voters passed a ballot initiative for the California Privacy Rights Act, or CPRA, which will significantly expand the CCPA to incorporate additional GDPR-like provisions including requiring that the use, retention, and sharing of personal information of California residents be reasonably necessary and proportionate to the purposes of collection or processing, granting additional protections for sensitive personal information, and requiring greater disclosures related to notice to residents regarding retention of information.

Most CPRA provisions will take effect on January 1, 2023, though the obligations will apply to any personal information collected after January 1, 2022.

These provisions may apply to some of our business activities.

In addition, other states, including Virginia and Colorado, already have passed state privacy laws.

Other states will be considering these laws in the future.

In November 2020, California voters passed a ballot initiative for the California Privacy Rights Act (the “CPRA”), which went into effect on January 1, 2023 and significantly expanded the CCPA to incorporate additional GDPR-like provisions including requiring that the use, retention, and sharing of personal information of California residents be reasonably necessary and proportionate to the purposes of collection or processing, granting additional protections for sensitive personal information, and requiring greater disclosures related to notice to residents regarding retention of information.

The CPRA also created a new enforcement agency – the California Privacy Protection Agency – whose sole responsibility is to enforce the CPRA, which will further increase compliance risk.

The provisions in the CPRA may apply to some of our business activities.

In addition, other states, including Virginia, Colorado, Utah, and Connecticut already have passed state privacy laws.

Virginia’s privacy law also went into effect on January 1, 2023, and the laws in the other three states will go into effect later in the year.

Other states will be considering these laws in the future, and Congress has also been debating passing a federal privacy law.

These laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products.

Similar to the laws in the United States, there are significant privacy and data security laws that apply in Europe and other countries.

The collection, use, disclosure, transfer, or other processing of personal data, including personal health data, regarding individuals who are located in the European Economic Area (EEA), and the processing of personal data that takes place in the EEA, is regulated by the General Data Protection Regulation, or GDPR, which went into effect in May 2018 and which imposes obligations on companies that operate in our industry with respect to the processing of personal data and the cross-border transfer of such data.

Similar to the laws in the U.S., there are significant privacy and data security laws that apply in Europe and other countries.

The collection, use, disclosure, transfer, or other processing of personal data, including personal health data, regarding individuals who are located in the European Economic Area (“EEA”), and the processing of personal data that takes place in the EEA, is regulated by the GDPR, which went into effect in May 2018 and which imposes obligations on companies that operate in our industry with respect to the processing of personal data and the cross-border transfer of such data.

The GDPR imposes onerous accountability obligations requiring data controllers and processors to maintain a record of their data processing and policies.

personal data and/or fines of up to 20 million Euros or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, as well as compensation claims by affected individuals, negative publicity, reputational harm and a potential loss of business and goodwill.

The GDPR places restrictions on the cross-border transfer of personal data from the EU to countries that have not been found by the European Commission to offer adequate data protection legislation, such as the United States.

If our or our partners’ or service providers’ privacy or data security measures fail to comply with the GDPR requirements, we may be subject to litigation, regulatory investigations, enforcement notices requiring us to change the way we use personal data and/or fines of up to 20 million Euros or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, as well as compensation claims by affected individuals, negative publicity, reputational harm and a potential loss of business and goodwill.

The GDPR places restrictions on the cross-border transfer of personal data from the EU to countries that have not been found by the EC to offer adequate data protection legislation, such as the U.S.

There are ongoing concerns about the ability of companies to transfer personal data from the EU to other countries.

In July 2020, the Court of Justice of the European Union (“CJEU”) invalidated the EU-U.S.

In July 2020, the Court of Justice of the European Union (the “CJEU”) invalidated the EU-U.S.

Privacy Shield, one of the mechanisms used to legitimize the transfer of personal data from the EEA to the U.S.

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generally and increase our costs of compliance with data privacy legislation as well as our costs of negotiating appropriate privacy and security agreements with our vendors and business partners.

Following the withdrawal of the U.K.

from the EU, the U.K.

Data Protection Act 2018 applies to the processing of personal data that takes place in the U.K.

and includes parallel obligations to those set forth by GDPR.

Additionally, in October 2022, President Joe Biden signed an executive order to implement the EU-U.S.

Data Privacy Framework, which would serve as a replacement to the EU-US Privacy Shield.

The EC initiated the process to adopt an adequacy decision for the EU-US Data Privacy Framework in December 2022.

It is unclear if and when the framework will be finalized and whether it will be challenged in court.

The uncertainty around this issue may further impact our business operations in the EU.

Following the withdrawal of the UK from the EU, the UK Data Protection Act 2018 applies to the processing of personal data that takes place in the UK and includes parallel obligations to those set forth by GDPR.

As with other issues related to Brexit, there are open questions about how personal data will be protected in the UK and whether personal information can transfer from the EU to the UK.

Following the withdrawal of the U.K.

from the EU, the U.K.

Data Protection Act 2018 applies to the processing of personal data that takes place in the U.K.

and includes parallel obligations to those set forth by GDPR.

While the Data Protection Act of 2018 in the United Kingdom that “implements” and complements the European Union General Data Protection Regulation, or GDPR, has achieved Royal Assent on May 23, 2018 and is now effective in the United Kingdom, it is still unclear whether transfer of data from the European Economic Area, or EEA, to the United Kingdom will remain lawful under GDPR.

It is still unclear whether transfer of data from the European Economic Area, or EEA, to the UK will remain lawful under GDPR.

The United Kingdom government has already determined that it considers all European Union and EEA member states to be adequate for the purposes of data protection, ensuring that data flows from the United Kingdom to the European Union/EEA remain unaffected.

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While many loosely follow GDPR as a model, other laws contain different or conflicting provisions.

These laws will impact our ability to conduct our business activities, including both our clinical trials and any eventual sale and distribution of commercial products, through increased compliance costs, costs associated with contracting and potential enforcement actions.

These laws will impact our ability to conduct our business activities, including both our clinical trials and the sale and distribution of commercial products, through increased compliance costs, costs associated with contracting and potential enforcement actions.

While we continue to address the implications of the recent changes to data privacy regulations, data privacy remains an evolving landscape at both the domestic and international level, with new regulations coming into effect and continued legal challenges, and our efforts to comply with the evolving data protection rules may be unsuccessful.

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Failure to comply with laws regarding data protection would expose us to risk of enforcement actions taken by data protection authorities in the EEA and elsewhere and carries with it the potential for significant penalties if we are found to be non-compliant.

Similarly, failure to comply with federal and state laws in the United States regarding privacy and security of personal information could expose us to penalties under such laws.

Similarly, failure to comply with federal and state laws in the U.S.

regarding privacy and security of personal information could expose us to penalties under such laws.

Any such failure to comply with data protection and privacy laws could result in government-imposed fines or orders requiring that we change our practices, claims for damages or other liabilities, regulatory investigations and enforcement action, litigation and significant costs for remediation, any of which could adversely affect our business.

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The loss of the services of any of these persons could impede the achievement of our research, development, and commercialization objectives.

Additionally, we are actively trying to recruit a candidate for the role of Chief Medical Officer.

Additionally, we are actively trying to recruit a candidate for the role of Chief Scientific Officer.

Any inability to fill this position in an expedient manner may have a material adverse effect on our business.

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Our consultants and advisors may be employed by employers other than us and may have commitments under consulting or advisory contracts with other entities that may limit their availability to us.

In addition, our ability to recruit and retain qualified personnel could be impacted by other factors, such as remote or hybrid working arrangements, including those resulting from the ongoing COVID-19 pandemic, which could impact employees’ productivity and morale, as well as any failure to succeed in preclinical or clinical trials.

In addition, our ability to recruit and retain qualified personnel could be impacted by other factors, such as remote or hybrid working arrangements, which could impact employees’ productivity and morale, as well as any failure to succeed in preclinical or clinical trials.

The inability to recruit or the loss of the services of any executive, key employee, consultant or advisor may impede the progress of our research, development and commercialization objectives.

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Significant outbreaks of contagious diseases, and other adverse public health developments, could have a material impact on our business operations and operating results.

The ongoing COVID-19 pandemic has continued to evolve with new, more contagious, variants emerging from time to time.

In response to COVID-19 and these variants, governments have implemented a variety of responses, including government-imposed quarantines, travel restrictions and other public health safety measures.

We have taken steps in line with guidance from the U.S.

Centers for Disease Control and Prevention, the Commonwealth of Massachusetts and the State of Colorado, the jurisdictions in which we primarily operate our business, to protect the health and safety of our employees and the community.

In particular, in March 2020, we implemented a work from home policy, and restricted on-site activities at our facilities in Massachusetts and Colorado to certain manufacturing, laboratory and related support activities.

Under our return to onsite work plans, we gradually resumed these activities and fully reopened our facilities in the third quarter of 2021 using a hybrid work model.

However, in response to the recent spread of the Omicron variant, for January and a portion of February we temporarily reimposed the work from home policy and on-site activity restrictions.

We continue to assess the impact of the COVID-19 pandemic to best mitigate risk and continue the operations of our business, with focus on prioritizing the health and safety of our employees and maintaining safe and reliable operations of our facilities.

As a result of the COVID-19 pandemic or similar public health crises that may arise, or related healthcare staffing shortages, supply chain restrictions, or other issues, we may experience disruptions that could adversely impact our operations, research and development, including preclinical studies, clinical trials and manufacturing activities, including:

Any public health crises, including the COVID-19 pandemic, or related healthcare staffing shortages, supply chain restrictions, or other issues, may result in disruptions that could adversely impact our operations, research and development, including preclinical studies, clinical trials and manufacturing activities, including:

● delays or disruptions in clinical trials that we may be conducting, including patient screening, patient enrollment, patient dosing, clinical trial site activation, and study monitoring;

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● business disruptions caused by potential workplace, laboratory and office closures and an increased reliance on employees working from home, disruptions to or delays in ongoing laboratory experiments and operations, staffing shortages, travel limitations, cyber security and data accessibility, or communication or mass transit disruptions, any of which could adversely impact our business operations or delay necessary interactions with local regulators, ethics committees, manufacturing sites, research or clinical trial sites and other important agencies and contractors.

Our clinical trials for EDIT-101 and EDIT-301, as well as timely completion of preclinical activities and initiation of planned clinical trials for other product candidates is dependent upon the availability of, for example, preclinical and clinical trial sites, researchers and investigators, regulatory agency personnel, and materials, which may be adversely affected by the COVID-19 pandemic and related government responses.

For example, in late 2020 we experienced slowed enrollment in the EDIT-101 clinical trial as a result of the COVID-19 pandemic, including international travel restrictions imposed in response to the pandemic.

We have also experienced some delays in obtaining materials for certain of our programs, but these delays have not significantly impacted our operations to date.

Our clinical trials for EDIT-301, as well as timely completion of preclinical activities and initiation of planned clinical trials for other product candidates, is dependent upon the availability of, for example, preclinical and clinical trial sites, researchers and investigators, regulatory agency personnel, and materials, which may be adversely affected by a public health crisis and related government responses .

A resurgence or other negative developments relating to the COVID-19 pandemic may require us to restrict access to our offices and laboratories for an extended period of time, or to pause or suspend preclinical research and our clinical trials;

and, further, may cause delays or restrictions at healthcare facilities or disrupt our manufacturing and supply chain or those of our third-party suppliers and manufacturers.

In addition, the trading prices for our common stock and other biopharmaceutical companies have been highly volatile in part as a result of the COVID-19 pandemic.

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If we or any of the third parties with whom we engage, however, were to experience shutdowns or other business disruptions, our ability to conduct our business in the manner and on the timelines presently planned could be materially and negatively affected, which could have a material adverse impact on our business and our results of operation and financial condition.

We have expanded and expect to further expand our development, regulatory, clinical, manufacturing and future sales and marketing capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.

We expect to experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of drug development, regulatory affairs, clinical development, manufacturing, and sales and marketing.

We expect to expand our manufacturing, clinical, development, and regulatory capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.

We expect growth in the number of our employees and the scope of our operations, particularly in the areas of manufacturing, clinical development, drug development, and regulatory affairs, and, if any product candidates receive marketing approval, sales and marketing.

To manage our anticipated future growth, we must continue to implement and improve our managerial, operational, and financial systems, expand our facilities, and continue to recruit and train additional qualified personnel.

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Security breaches and other disruptions to our information technology structure could compromise our information, disrupt our business and expose us to liability, which would cause our business and reputation to suffer.

and we may collect personally identifiable information of clinical trial participants in connection with clinical trials.

In the ordinary course of our business, we collect, process and store sensitive data, including intellectual property, as well as our proprietary business information and that of our suppliers and business partners, employee data, and we may collect personally identifiable information of clinical trial participants in connection with clinical trials.

We also rely to a large extent on information technology systems to operate our business, including our financial systems.

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We, our partners, vendors, and other third-party providers could be susceptible to third party attacks on our, and their, information security systems, which attacks are of ever-increasing levels of sophistication and are made by groups and individuals with a wide range of motives and expertise, including organized criminal groups, hacktivists, nation states and others.

Furthermore, in response to the COVID-19 pandemic, we have implemented a hybrid work model, which may place our information technology infrastructure and data at increased risk as more of our employees work from home utilizing network connections outside our premises.

Furthermore, we have implemented a hybrid work model, which may place our information technology infrastructure and data at increased risk as more of our employees work from home utilizing network connections outside our premises.

We have invested in information technology security measures and the protection of confidential and sensitive information, but there can be no assurance that our efforts will prevent system failures, accidents or security breaches.

While we believe we have not experienced any such material system failure, accident or security breach to date, any such event may substantially impair our ability to operate our business and would compromise our, and their, networks and the information stored could be accessed, publicly disclosed, lost, or stolen.

In addition, if a ransomware attack or other cybersecurity incident occurs, either internally or at our vendors or third-party technology service providers, we could be prevented from accessing our data or systems, which may cause interruptions or delays in our business operations, cause us to incur remediation costs, subject us to demands to pay a ransom, or damage our reputation, regardless of whether we pay the ransom amount.

Any such event, or other loss of information, could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, disrupt our operations, and damage our reputation, any of which could adversely affect our business.

Although we have general liability and cybersecurity insurance coverage, our insurance may not cover all claims, continue to be available on reasonable terms or be sufficient in amount to cover one or more large claims;

additionally, the insurer may disclaim coverage as to any claim.

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● the success of existing or new competitive products or technologies;

● the timing and results of clinical trials for EDIT-101 and EDIT-301 and any preclinical studies and clinical trials of any other product candidates that we develop;

● the timing and results of clinical trials for EDIT-301 and any preclinical studies and clinical trials of any other product candidates that we develop;

● commencement or termination of collaborations for our product development and research programs;

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● market conditions in the pharmaceutical and biotechnology sectors;

● general economic, industry, and market conditions, including the impact of the COVID-19 pandemic;

● general economic, industry, and market conditions;

● the other factors described in this “Risk Factors” section.

In addition, the trading prices for our common stock and other biopharmaceutical companies have been highly volatile as a result of the COVID-19 pandemic.

The extent to which the COVID-19 pandemic may impact our business, preclinical studies and ongoing and planned clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the emergence of new variants of the disease, the ability of governments to vaccinate their populations and the effectiveness of existing vaccines to address any new variants, the ultimate containment of the disease, the modification or lifting of travel restrictions and other actions implemented to contain the outbreak or address its impact, such as social distancing and quarantines or lock-downs in the United States and other countries, business closures or business disruptions, and the ultimate effectiveness of other actions taken in the United States and other countries to contain and address the disease.

A resurgence or other negative developments relating to the pandemic may require us to again restrict access to our offices and laboratories for an extended period of time, or to pause or suspend preclinical research and our clinical trials;

and, further, may cause delays or restrictions at healthcare facilities or disrupt our manufacturing and supply chain or those of our third-party suppliers and manufacturers.

In recent years, the stock market in general, and the market for pharmaceutical and biotechnology companies in particular, has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to changes in the operating performance of the companies whose stock is experiencing those price and volume fluctuations.

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If one or more of these analysts cease to cover our stock or fail to regularly publish reports on us, we could lose visibility in the market for our stock, which in turn could cause our stock price to decline.

A portion of our total outstanding shares may be sold into the market in the near future, which could cause the market price of our common stock to decline significantly, even if our business is doing well.

Sales of a significant number of shares of our common stock in the public market could occur at any time.

Future sales and issuances of our common stock or rights to purchase common stock, including pursuant to our equity incentive plans, could result in additional dilution of the percentage ownership of stockholders and could cause our stock price to fall.

We will need additional capital in the future to continue our planned operations.

To the extent we raise additional capital by issuing equity securities, our stockholders may experience substantial dilution.

We may sell common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner we determine from time to time.

If we sell common stock, convertible securities or other equity securities in more than one transaction, investors may be materially diluted by subsequent sales.

These sales may also result in material dilution to our existing stockholders, and new investors could gain rights superior to our existing stockholders.

In addition, sales of a significant number of shares of our common stock in the public market could occur at any time.

These sales, or the perception in the market that the holders of a large number of shares of common stock intend to sell shares, could reduce the market price of our common stock.

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Provisions in our restated certificate of incorporation and amended and restated bylaws or Delaware law might discourage, delay, or prevent a change in control of our company or changes in our management and, therefore, depress the trading price of our common stock.

Provisions in our restated certificate of incorporation and amended and restated bylaws or Delaware law may discourage, delay, or prevent a merger, acquisition, or other change in control that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares of our common stock.

provisions may also prevent or frustrate attempts by our stockholders to replace or remove our management.

Provisions in our restated certificate of incorporation and amended and restated bylaws or Delaware law may

discourage, delay, or prevent a merger, acquisition, or other change in control that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares of our common stock.

These provisions may also prevent or frustrate attempts by our stockholders to replace or remove our management.

These provisions include:

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It could apply, however, to a suit that falls within one or more of the categories enumerated in the exclusive forum provision and asserts claims under the Securities Act of 1933, as amended (the “Securities Act”) , inasmuch as Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder;

provided, that with respect to claims under the Securities Act, our stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.

provided, that with respect to claims under the Securities Act, our stockholders will not be deemed to have

waived our compliance with the federal securities laws and the rules and regulations thereunder.

Unresolved Staff Comment s

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors