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Item 1A. Risk Factors

2026-03-17 compared with 2025-03-13 · 272 added, 212 removed, 1096 unchanged (31% of the section changed)

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• We will require substantial additional financing to achieve our goals.

• We depend heavily on the ability to successfully advance seralutinib through clinical development.

• We depend heavily on the ability to advance seralutinib through clinical development successfully.

• The results from the PROSERA Phase 3 clinical trial may not be sufficient to support FDA approval or continued development of seralutinib, which would materially and adversely harm our business.

• We may not realize the expected benefits from our recent workforce reduction.

• Clinical drug development involves a lengthy and expensive process with an uncertain outcome, and the results of preclinical studies and early clinical trials are not necessarily predictive of future results.

• Our business may be adversely affected by difficulties or delays in enrolling patients in our current or planned clinical trials or the commencement or completion, or termination or suspension, of our current or planned clinical trials.

• Our business may be adversely affected by difficulties or delays in enrolling patients in our current or future clinical trials or the commencement or completion, or termination or suspension, of our current or future clinical trials.

• We operate in a highly regulated industry and such regulation may cause unanticipated delays or prevent the receipt of the required approvals to commercialize seralutinib.

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Seralutinib is in active clinical development.

We have not yet demonstrated an ability to successfully complete any clinical trials beyond Phase 2, obtain regulatory approvals, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization.

We have not yet demonstrated an ability to obtain regulatory approvals, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization.

Consequently, any predictions made about our future success or viability may not be as accurate as they could be if we had a history of successfully developing and commercializing biopharmaceutical products.

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Substantially all of our losses have resulted from expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations.

Seralutinib will require substantial additional development time and resources before we would be able to apply for or receive regulatory approvals and begin generating revenue from product sales.

We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase substantially as we continue our development of, seek regulatory approval for and potentially commercialize seralutinib and seek to identify, assess, acquire, in-license or develop additional product candidates.

Seralutinib will require substantial additional time and resources, and may require additional development, before we would be able to receive regulatory approvals and begin generating revenue from product sales, if ever.

We expect to continue to incur losses for the foreseeable future as we continue our development of, seek regulatory approval for and potentially commercialize seralutinib and seek to identify, assess, acquire, in-license or develop additional product candidates.

To become and remain profitable, we must succeed in developing and eventually commercializing products that generate significant revenue.

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The development of biopharmaceutical product candidates is capital-intensive.

We expect our expenses to remain high in connection with our ongoing activities, particularly as we conduct our ongoing and planned clinical trials of seralutinib, continue research and development, and seek regulatory approval for seralutinib.

We expect our expenses to remain high in connection with our ongoing activities, particularly as we conduct our ongoing and future clinical trials of seralutinib, continue research and development, and seek regulatory approval for seralutinib.

In addition, as seralutinib progresses through development and toward commercialization, we will need to make milestone payments to Pulmokine from whom we have in-licensed seralutinib.

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

We believe that our existing cash, cash equivalents and marketable securities will enable us to fund our operations for at least the next 12 months from the date this annual report is filed with the SEC.

In particular, we expect that these funds will allow us to complete our registrational Phase 3 clinical trial in PAH for seralutinib.

We believe that our existing cash, cash equivalents and marketable securities will enable us to fund our operations into the first quarter of 2027.

In particular, we expect that these funds will allow us to meet with the FDA to discuss a potential path forward for seralutinib in PAH and, subject to those discussions, to file an NDA with the FDA, although we will be required to raise additional capital to support any additional development required by the FDA prior to any NDA submission.

We have based these estimates on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.

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

• the type, number, scope, progress, expansions, results, costs and timing of, our clinical trials and preclinical studies of seralutinib or product candidates we may choose to pursue in the future;

• the costs and timing of manufacturing for seralutinib, including commercial manufacturing if seralutinib is approved;

• the outcome of our discussions with the FDA on a potential path forward for seralutinib in PAH;

• the costs, timing and outcome of regulatory review of seralutinib;

• the costs and timing of manufacturing for seralutinib, including commercial manufacturing if seralutinib is approved;

• the costs of obtaining, maintaining and enforcing our patents and other intellectual property rights;

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We may also incur additional indebtedness or liabilities to meet our future financing needs.

Our indebtedness and liabilities could have significant

negative consequences for our stockholders and our business, results of operations and financial condition by, among other things:

Our indebtedness and liabilities could have significant negative consequences for our stockholders and our business, results of operations and financial condition by, among other things:

• increasing our vulnerability to adverse economic and industry conditions;

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Our business may not generate sufficient funds, and we may otherwise be unable to maintain sufficient cash reserves, to pay amounts due under our indebtedness, including the notes, and our cash needs may increase in the future.

Given the uncertainty regarding the path forward for seralutinib following the results of our Phase 3 PROSERA study, we may be unable to raise additional capital or repay or refinance our existing indebtedness on acceptable terms, or at all.

Our ability to refinance our outstanding notes, which mature in May 2027, will depend on the capital markets, investor sentiment on our prospects and our financial condition.

If we are unable to repay or refinance the notes at maturity, we could be required to restructure our indebtedness and/or obtain additional equity capital on terms that may be onerous, unfavorable and highly dilutive, delay or curtail our development programs, sell assets, or seek protection under applicable bankruptcy or insolvency laws, any of which could have a material adverse effect on our business, prospects, financial condition and results of operations.

In addition, any future indebtedness that we may incur may contain, financial and other restrictive covenants that limit our ability to operate our business, raise capital or make payments under our other indebtedness.

If we fail to comply with these covenants or to make payments under our indebtedness when due, then we would be in default under that indebtedness, which could, in turn, result in that and our other indebtedness becoming immediately payable in full.

Additionally, if our liquidity position is impaired, we may be required to take further actions in relation to management of liabilities on our balance sheet.

Any actions in relation to liability management and balance sheet restructuring may materially reduce the value of our common stock, dilute existing holders of our common stock by the conversion of existing liabilities into equity or result in the cancellation of existing common stock.

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

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Risks Related to the Development and Regulatory Approval of Seralutinib

The results from the PROSERA Phase 3 clinical trial may not be sufficient to support FDA approval or continued development of seralutinib, which would materially and adversely harm our business.

In February 2026, we announced topline results from the Phase 3 PROSERA clinical trial of seralutinib in PAH, including that the study did not meet its primary endpoint.

We plan to meet with the FDA in the second quarter of 2026 to review the PROSERA results with the aim to determine the path forward for seralutinib in PAH.

In general, the FDA has substantial discretion in the approval process and may decide that the totality of our datasets are insufficient for approval and require additional preclinical, clinical or other trials, before we are able to submit an NDA for seralutinib, especially given that the PROSERA study did not meet its primary endpoint.

Any such decision or feedback from the FDA would result in additional development costs and could significantly delay the potential for regulatory approval.

We also may be unable to identify a viable development path towards approval for seralutinib, based on FDA feedback, our internal analysis of the data and market opportunity, or other factors.

Even if we do identify a path to approval for seralutinib, we may require substantial

additional capital and other resources to pursue such a path, and may be unable to raise such capital in the amounts needed or on attractive terms.

There is also no assurance that any future trials or studies we may need to conduct will be successful.

We may also pursue business development arrangements or other strategic collaborations;

however, we may be unable to secure such arrangements on a timely basis or at all.

If we are unable to develop or seek marketing approval for seralutinib or secure other strategic arrangements with third parties, or if we experience delays as a result of any of the above factors or otherwise, our business would be significantly harmed.

We may not realize the expected benefits from our recent workforce reduction.

Following the topline results from PROSERA, in March 2026 we announced a workforce reduction of approximately 77 individuals, or approximately 48% of our total workforce, intended to preserve cash while maintaining our core capabilities as we discuss the path forward for seralutinib with the FDA.

We also may not realize the benefits expected from the workforce reduction, including our ability to conserve cash, and such actions may make it more difficult to retain key personnel.

This reduction-in-force may result in unintended consequences and costs, such as the loss of institutional knowledge and expertise and decreased morale among our remaining employees.

Further, there can be no assurance that any particular course of action, development path or strategic arrangement will be pursued, successfully consummated or lead to increased stockholder value.

We depend entirely on the success of seralutinib , which is currently in Phase 3 clinical development.

If we are unable to advance seralutinib in clinical development, obtain regulatory approval and ultimately commercialize seralutinib, or experience significant delays in doing so, our business will be materially harmed.

In addition, we intend to continue advancing RT234 pursuant to our option agreement with Respira Therapeutics.

We may not have sufficient capital or other resources to continue such program, and even if we do, any development efforts may not be successful or warrant continued development.

Our only product candidate is currently in Phase 3 clinical development.

We are conducting an open-label extension of our Phase 2 clinical trial of seralutinib in PAH which commenced in 2020, and we commenced a registrational Phase 3 clinical trial of seralutinib in PAH in the fourth quarter of 2023.

We expect to activate clinical sites for a global registrational Phase 3 for the treatment of PH-ILD in the second half of 2025.

We are conducting an open-label extension of our Phase 2 clinical trial of seralutinib in PAH, which commenced in 2020, and an open-label extension of our Phase 3 clinical trial of seralutinib in PAH, which commenced in 2025.

In February 2026, we also announced that we paused enrollment of our Phase 3 clinical trial of seralutinib in PH-ILD.

In addition, we intend to continue advancing RT234 pursuant to our option agreement with Respira Therapeutics.

Our assumptions about why seralutinib is worthy of future development and potential approval in PAH, or any additional indications including PH-ILD, are based in part on data collected by other companies.

Our ability to generate product revenues, which we do not expect will occur for many years, if ever, will depend heavily on the successful development and eventual commercialization of seralutinib.

The success of seralutinib will depend on several factors, including the following:

• successful enrollment in clinical trials and completion of clinical trials and preclinical studies with favorable results;

The success of seralutinib or RT234, if we exercise our option to acquire Respira Therapeutics, will depend on several factors, including the following:

• regulatory authority acceptance of our proposed design of future clinical trials and allowance to proceed with such clinical trials under INDs by the FDA or under similar applications by comparable regulatory authorities;

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• establishing sales, marketing and distribution capabilities and launching commercial sales of seralutinib, if and when approved, whether alone or in collaboration with others;

• successful enrollment in clinical trials and completion of clinical trials and preclinical studies with favorable results;

• establishment and maintenance of patent and trade secret protection or regulatory exclusivity for seralutinib;

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Seralutinib, will therefore require review and coordination by FDA’s drug and device centers prior to approval, which may delay approval.

Under FDA regulations, combination products are subject to current good manufacturing practice, or cGMP, requirements applicable to both drugs and devices, including the Quality System regulation currently applicable to medical devices in the United States.

Under FDA regulations, combination products are subject to current good manufacturing practice, or cGMP, requirements applicable to both drugs and devices, including the Quality Management System regulation currently applicable to medical devices in the United States.

The EU regulates medical devices and medicinal products separately, through different legislative instruments, and the applicable requirements will vary depending on the type of drug-device combination product.

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The success of our business, including our ability to finance our company and generate any revenue in the future, will primarily depend on the successful development, regulatory approval and commercialization of seralutinib, which may never occur.

We have not yet succeeded and may not succeed in demonstrating efficacy and safety for seralutinib in clinical trials or in obtaining marketing approval thereafter.

Given our current stage of development, it may be several years, if at all, before we have demonstrated the safety and efficacy of a treatment sufficient to warrant approval for commercialization.

We have not yet succeeded and may not succeed in demonstrating efficacy and safety for seralutinib in clinical trials to the satisfaction of FDA or other regulatory authorities.

Given our current stage of development and the results of our PROSERA Phase 3 clinical trial of seralutinib in PAH, it may be several years, if at all, before we have demonstrated the safety and efficacy of a treatment sufficient to warrant approval for commercialization.

If we are unable to develop, or obtain regulatory approval for, or, if approved, successfully commercialize seralutinib, we may not be able to generate sufficient revenue to continue our business.

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In addition, some of our assumptions about why seralutinib is worthy of future development and potential approval are based on data collected by other companies.

Seralutinib may not have favorable results in its Phase 3 clinical trial in PAH or the anticipated Phase 3 clinical trial in PH-ILD, or receive regulatory approval on a timely basis, if at all.

Seralutinib may not receive regulatory approval on a timely basis, if at all.

Clinical drug development is expensive and can take many years to complete, and its outcome is inherently uncertain.

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Product candidates in later stages of clinical trials may fail to show the desired safety and efficacy characteristics despite having progressed through preclinical studies and initial clinical trials.

It is not uncommon to observe results in clinical trials that are unexpected based on preclinical studies and early clinical trials, and

many product candidates fail in clinical trials despite very promising early results.

For example, our decision to advance seralutinib as a potential treatment for PAH is based in part on the efficacy of imatinib (Gleevec), a tyrosine kinase inhibitor with known activity against PDGF and marketed for oncology indications, observed by Novartis in a Phase 3 clinical trial;

however, we may not observe similar efficacy in our Phase 3 clinical trial of seralutinib.

It is not uncommon to observe results in clinical trials that are unexpected based on preclinical studies and early clinical trials, and many product candidates fail in clinical trials despite very promising early results.

For example, in February 2026, we announced that the Phase 3 PROSERA clinical trial did not meet its primary endpoint .

Moreover, these and any future preclinical and clinical data may be susceptible to varying interpretations and analyses.

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

For the foregoing reasons, we cannot be certain that our ongoing and planned clinical trials and preclinical studies will be successful.

Any safety concerns observed in any one of our clinical trials in our targeted indications could limit the prospects for regulatory approval of seralutinib in PAH and other indications including PH-ILD, which could have a material adverse effect on our business, financial condition and results of operations.

Any difficulties or delays in the commencement or completion, or termination or suspension, of our current or planned clinical trials could result in increased costs to us, delay or limit our ability to generate revenue and adversely affect our commercial prospects.

For the foregoing reasons, we cannot be certain that our ongoing and future clinical trials and preclinical studies will be successful.

Any safety concerns observed in any one of our clinical trials in our targeted indications could limit the prospects for regulatory approval of seralutinib in PAH and other indications that we may pursue in the future, including PH-ILD, which could have a material adverse effect on our business, financial condition and results of operations.

Any difficulties or delays in the commencement or completion, or termination or suspension, of our current or future clinical trials could result in increased costs to us, delay or limit our ability to generate revenue and adversely affect our commercial prospects.

Before obtaining marketing approval from regulatory authorities for the sale of seralutinib, we must conduct extensive clinical studies to demonstrate the safety and efficacy of seralutinib in humans.

For example, we are currently conducting a registrational Phase 3 clinical trial of seralutinib in PAH patients.

In addition, before we can initiate clinical development for our product candidates, and in some cases, before we can pursue clinical development of a product candidate for a new potential indication, we must submit the results of preclinical studies to the FDA along with other information, including information about product candidate chemistry, manufacturing and controls and our proposed clinical trial protocol, as part of an IND, and we are also required to submit regulatory filings to foreign regulatory authorities for clinical trials outside of the United States.

We do not know whether our ongoing or planned trials will begin on time or be completed on schedule, if at all.

information, including information about product candidate chemistry, manufacturing and controls and our proposed clinical trial protocol, as part of an IND, and we are also required to submit regulatory filings to foreign regulatory authorities for clinical trials outside of the United States.

We do not know whether our ongoing or future trials will begin on time or be completed on schedule, if at all.

The commencement, data readouts and completion of clinical trials can be delayed for a number of reasons including delays related to:

• the FDA or comparable foreign regulatory authorities disagreeing as to the design or implementation of our clinical studies, including the doses and endpoints of our ongoing and planned Phase 3 clinical trial of seralutinib;

• the FDA or comparable foreign regulatory authorities disagreeing as to the design or implementation of our clinical studies, including the doses and endpoints of our ongoing or potential future Phase 3 clinical trial of seralutinib;

• obtaining regulatory authorizations to commence a trial or reaching a consensus with regulatory authorities on trial design;

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• third-party contractors becoming debarred or suspended or otherwise penalized by the FDA or other government or regulatory authorities for violations of regulatory requirements, in which case we may need to find a substitute contractor, and we may not be able to use some or all of the data produced by such contractors in support of our marketing applications.

Such delays or regulatory feedback on our trial designs could also significantly increase the costs of our clinical trials, including our Phase 3 clinical trial of seralutinib.

Such delays or regulatory feedback on our trial designs could also significantly increase the costs of our clinical trials, including any future clinical trials of seralutinib.

We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs of the institutions in which such trials are being conducted, by a Data Safety Monitoring Board for such trial or by the FDA or comparable foreign regulatory authorities.

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Compliance with the CTR requirements by us and our third-party service providers, such as contract research organizations, or CROs, may impact our developments plans.

It is currently unclear to what extent UK will seek to align its regulations with the EU.

The UK regulatory framework in relation to clinical trials is derived from the now-repealed EU Clinical Trials Directive (as implemented into UK law, through the Medicines for Human Use (Clinical Trials) Regulations 2004, as amended).

The extent to which the regulation of clinical trials in the UK will mirror the (EU) CTR in the long term is not yet certain, however, on December 12, 2024, the UK government introduced a legislative proposal - the Medicines for Human Use (Clinical Trials) Amendment Regulations 2024 - that, if implemented, will replace the current regulatory framework for clinical trials in the UK.

The legislative proposal aims to provide a more flexible regime to make it easier to conduct clinical trials in the UK, increase the transparency of clinical

trials conducted in the UK and make clinical trials more patient centered.

The UK government has provided the legislative proposal to the UK Parliament for its review and approval.

Once the legislative proposal is approved (with or without amendment), it will be adopted into UK law which is expected in early 2026.

In April 2025, the UK government introduced the Medicines for Human Use (Clinical Trials) Amendment Regulations 2024.

The amendment, which will take full effect from April 2026, aims to provide a more flexible regime to make it easier to conduct clinical trials in the UK, increase the transparency of clinical trials conducted in the UK and make clinical trials more patient centered.

Under the terms of the Protocol on Ireland/Northern Ireland, provisions of the (EU) CTR which relate to the manufacture and import of investigational medicinal products and auxiliary medicinal products apply in Northern Ireland.

A decision by the UK government not to closely align its regulations with the new approach that has been adopted in the EU may have an effect on the cost of conducting clinical trials in the UK as opposed to other countries.

Clinical trial submissions in the UK will not be able to be bundled with those of EU member states within the EMA CTIS, adding further complexity, cost and potential risk to future clinical and development activity in the UK.

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These risks include the failure of enrolled patients in foreign countries to adhere to clinical protocol as a result of differences in healthcare services or cultural customs, managing additional administrative burdens associated with foreign regulatory schemes, as well as political and economic risks, including war, relevant to such foreign countries.

For example, we are currently conducting our registrational Phase 3 study of seralutinib in PAH at sites outside the United States.

For example, we are currently conducting the open label Phase 3 study of seralutinib in PAH at sites outside the United States.

If we experience delays in the completion of, or termination of, any clinical trial of seralutinib, the commercial prospects of seralutinib will be harmed, and our ability to generate product revenues from seralutinib will be delayed.

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In addition, many of the factors that cause, or lead to, termination or suspension of, or a delay in the commencement or completion of, clinical trials may also ultimately lead to the denial of regulatory approval of seralutinib.

We may make formulation or manufacturing changes to seralutinib, in which case we may need to conduct additional preclinical studies to bridge our modified seralutinib to an earlier version.

We may make formulation or manufacturing changes to seralutinib, in which case we may need to conduct additional preclinical

studies to bridge our modified seralutinib to an earlier version.

Any delays to our clinical trials that occur as a result could shorten any period during which we may have the exclusive right to commercialize seralutinib and our competitors may be able to bring products to market before we do, and the commercial viability of seralutinib could be significantly reduced.

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We will be required to identify and enroll a sufficient number of subjects for each of our clinical trials.

Potential subjects for any planned clinical trials may not be adequately diagnosed or identified with the diseases which we are targeting or may not meet the entry criteria for such trials.

For example, a limited number of patients are affected by PAH and other indications including PH-ILD, which are our target indication for seralutinib, and we have encountered difficulties enrolling patients in our previous clinical trials of seralutinib in PAH patients.

We also may encounter difficulties in identifying and enrolling subjects with a stage of disease appropriate for our Phase 3 trial of seralutinib and monitoring such subjects adequately during and after treatment.

Potential subjects for any future clinical trials may not be adequately diagnosed or identified with the diseases which we are targeting or may not meet the entry criteria for such trials.

For example, a limited number of patients are affected by PAH and other indications that we may pursue such as PH-ILD, and we have encountered difficulties enrolling patients in our previous clinical trials of seralutinib in PAH patients.

We also may encounter difficulties in identifying and enrolling subjects with a stage of disease appropriate for any future trials of seralutinib and monitoring such subjects adequately during and after treatment.

We may not be able to initiate or continue clinical trials if we are unable to locate a sufficient number of eligible subjects to participate in the clinical trials required by the FDA or comparable foreign regulatory authorities.

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The eligibility criteria of our clinical trials, once established, will further limit the pool of available trial participants.

For example, PAH is a rare disease with limited patient pools from which to draw for our registrational Phase 3 trial.

If patients are unwilling to participate in our trials for any reason, including the existence of concurrent clinical trials for similar patient populations in PAH, if they are unwilling to enroll in a clinical trial with a placebo-controlled design or the availability of approved therapies, or we otherwise have difficulty enrolling a sufficient

number of patients, the timeline for recruiting subjects, conducting studies and obtaining regulatory approval of seralutinib may be delayed.

Our inability to enroll a sufficient number of subjects for our Phase 3 trial of seralutinib or any of our future clinical trials would result in significant delays or may require us to abandon one or more clinical trials altogether.

For example, PAH is a rare disease with limited patient pools from which to draw.

Our inability to enroll a sufficient number of subjects for any of our future clinical trials would result in significant delays or may require us to abandon one or more clinical trials altogether.

In addition, we expect to rely on CROs and clinical trial sites to ensure proper and timely conduct of our future clinical trials and, while we intend to enter into agreements governing their services, we will have limited influence over their actual performance.

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Undesirable side effects caused by seralutinib could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the FDA or comparable foreign regulatory authorities.

For example, based upon the benefit / risk profile and in response to serious adverse events observed, we decided to terminate the Phase 1b/2 study for GB5121.

For example, transaminase elevations of three times or greater of the upper limit of normal were observed in 13% of patients receiving seralutinib, as compared to 1% of patients receiving placebo in our PROSERA Phase 3 clinical trial, and although we believe PAH clinicians are well-accustomed to administering and monitoring therapies with potential hepatic effects, such adverse events could adversely affect the development of seralutinib or otherwise impair any commercialization efforts for seralutinib, if approved.

Drug-related side effects could affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims.

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We may also be required to modify our study plans based on findings in our ongoing clinical trials.

For example, although we believe seralutinib has been generally well tolerated in completed clinical trials, future clinical trials, including our Phase 3 trial of seralutinib in PAH patients may reveal adverse events inconsistent with the safety findings observed to date.

For example, although we believe seralutinib has been generally well tolerated in completed clinical trials, with cough, headache and transaminase elevations being the most common treatment emergent adverse effects in our PROSERA Phase 3 clinical trial, future clinical trials may reveal adverse events inconsistent with the safety findings observed to date.

For example, in 2013, results from a Phase 3 clinical trial in PAH of imatinib (Gleevec) showed statistically significant improvement in its primary efficacy endpoint, but systemic toxicities were also observed.

Although we have not observed the systemic toxicities associated with imatinib, we cannot be certain that seralutinib will not exhibit similar or other toxicities in a larger Phase 3 clinical trial.

Although we have not observed the systemic toxicities associated with imatinib, we cannot be certain that seralutinib will not exhibit similar or other toxicities in the future as the use of seralutinib becomes more widespread if it receives regulatory approval.

Many compounds that initially showed promise in early-stage testing have later been found to cause side effects that prevented further development of the compound.

In addition, regulatory authorities may draw different conclusions or require additional testing to confirm these determinations.

It is possible that as we test seralutinib in our Phase 3 trial in PAH, or as the use of seralutinib becomes more widespread if it receives regulatory approval, illnesses, injuries, discomforts and other adverse events that were observed in earlier trials, as well as conditions that did not occur or went undetected in previous trials, will be reported by subjects.

It is possible that as we test seralutinib in future clinical trials, or as the use of seralutinib becomes more widespread if it receives regulatory approval, illnesses, injuries, discomforts and other adverse events that were observed in earlier trials, as well as conditions that did not occur or went undetected in previous trials, will be reported by subjects.

If such side effects become known later in development or upon approval, if any, such findings may harm our business, financial condition and prospects significantly.

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Any of these events could prevent us from achieving or maintaining market acceptance of seralutinib, if approved, and could significantly harm our business, results of operations and prospects.

Although we have completed Phase 2 clinical trials for multiple product candidates including seralutinib, we have not, as an organization, completed later-stage clinical trials or submitted an NDA, and we may be unable to do so for seralutinib.

We will need to successfully complete a pivotal clinical trial in order to obtain FDA or comparable foreign regulatory approval to market seralutinib.

Carrying out later-stage clinical trials and the submission of a successful NDA or other comparable foreign regulatory submission is a complicated process.

As an organization, we have completed four Phase 2 clinical trials, including a Phase 2 clinical trial of seralutinib, and are conducting a Phase 3 clinical trial of seralutinib in PAH.

We have not yet completed any pivotal clinical trials for seralutinib or previous product candidates.

We also have limited experience as a company in preparing, submitting marketing applications and have not previously submitted an NDA or other comparable foreign application for any product candidate.

We may also conduct a number of clinical trials for seralutinib in parallel over the next several years, which may be a difficult process to manage with our limited resources and which may divert the attention of management.

In addition, we have had limited interactions with the FDA and cannot be certain our Phase 3 clinical trial of seralutinib will be sufficient to support an NDA submission, even if we believe the results are sufficiently positive.

Although we have completed Phase 2 and 3 clinical trials for multiple product candidates including seralutinib, we have not, as an organization, submitted an NDA, and we may be unable to do so for seralutinib.

We have limited experience as a company in preparing, submitting marketing applications and have not previously submitted an NDA or other comparable foreign application for any product candidate.

While our primary focus is on seeking approval from the FDA for seralutinib in PAH, we may also conduct a number of clinical trials for seralutinib in parallel over the next several years, which may be a difficult process to manage with our limited resources and which may divert the attention of management.

In addition, we have had limited interactions with the FDA and cannot be certain our data from our Phase 2 and Phase 3 clinical trials of seralutinib will be sufficient to support an NDA submission in PAH, even if we believe the results are sufficiently positive to support a regulatory approval.

Consequently, we may be unable to successfully and efficiently execute and complete necessary clinical trials in a way that leads to regulatory submission and approval of seralutinib.

We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of seralutinib.

Failure to commence or complete, or delays in, our planned clinical trials, could prevent us from or delay us in submitting NDAs or other comparable foreign regulatory submissions for and commercializing seralutinib.

Seralutinib is subject to extensive regulation and compliance, which is costly and time consuming, and such regulation may cause unanticipated delays or prevent the receipt of the required approvals to commercialize seralutinib.

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Even if we believe the nonclinical or clinical data for seralutinib are promising, such data may not be sufficient to support approval by the FDA and comparable foreign regulatory authorities.

For example, we recently reported that the PROSERA Phase 3 did not meet its prespecified primary endpoint, and though we plan to discuss these results with the FDA to determine the appropriate path forward, there is no guarantee that the results from the PROSERA Phase 3 will be sufficient to support the submission of an NDA.

The FDA or comparable foreign regulatory authorities, as the case may be, may also require us to conduct additional preclinical studies or clinical trials for seralutinib either prior to or post-approval, or may object to elements of our clinical development program.

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Any delay in obtaining, or inability to obtain, applicable regulatory approval would delay or prevent commercialization of seralutinib and would materially adversely impact our business and prospects.

We may attempt to secure approval from the FDA or comparable foreign regulatory authorities through the use of accelerated approval pathways.

If we are unable to obtain such approval, we may be required to conduct additional clinical trials beyond those that we contemplate, which could increase the expense of obtaining, and delay the receipt of, necessary marketing approvals.

Even if we receive accelerated approval from the FDA, if our confirmatory trials do not verify clinical benefit, or if we do not comply with rigorous post-marketing requirements, the FDA may seek to withdraw accelerated approval.

We may in the future seek an accelerated approval for seralutinib.

Under the accelerated approval program, the FDA may grant accelerated approval to a product candidate designed to treat a serious or life-threatening condition that provides meaningful therapeutic benefit over available therapies upon a determination that seralutinib has an effect on a surrogate endpoint or intermediate clinical endpoint that is reasonably likely to predict clinical benefit.

The FDA considers a clinical benefit to be a positive therapeutic effect that is clinically meaningful in the context of a given disease, such as irreversible morbidity or mortality.

For the purposes of accelerated approval, a surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign, or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit.

An intermediate clinical endpoint is a clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit.

The accelerated approval pathway may be used in cases in which the advantage of a new drug over available therapy may not be a direct therapeutic advantage, but is a clinically important improvement from a patient and public health perspective.

If granted, accelerated approval is usually contingent on the sponsor’s agreement to conduct, in a diligent manner, confirmatory studies to verity and describe the drug’s predicted clinical benefit.

If such confirmatory studies fail to verify the drug’s predicted clinical benefit or of the sponsor fails to conduct such studies in a timely manner, the FDA may withdraw its approval of the drug on an expedited basis.

In addition, the Food and Drug Omnibus Reform Act of 2022, among other things, provided FDA statutory authority to mitigate potential risks to patients from continued marketing of ineffective drugs previously granted accelerated approval.

Under these provisions, the FDA may require a sponsor of a product seeking accelerated approval to have a confirmatory trial underway prior to such approval being granted.

If we decide to submit an application seeking accelerated approval, there can be no assurance that such submission or application will be accepted or that any expedited development, review or approval will be granted on a timely basis, or at all.

The FDA or other comparable foreign regulatory authorities could also require us to conduct further studies prior to considering our application or granting approval of any type.

A failure to obtain accelerated approval or any other form of expedited development, review or approval for seralutinib would result in a longer time period to commercialization of seralutinib, if any, could increase the cost of development of seralutinib and could harm our competitive position in the marketplace.

Moreover, in the EU, a “conditional” marketing authorization may be granted in cases where all the required safety and efficacy data are not yet available.

A conditional marketing authorization is subject to conditions to be fulfilled for generating missing data or ensuring increased safety measures.

A conditional marketing authorization is valid for one year and has to be renewed annually until fulfillment of all relevant conditions.

Once the applicable pending studies are provided, a conditional marketing authorization can become a “standard” marketing authorization.

However, if the conditions are not fulfilled within the timeframe set by the EMA, the marketing authorization will cease to be renewed.

Furthermore, marketing authorizations may also be granted “under exceptional circumstances” when the applicant can show that it is unable to provide comprehensive data on the efficacy and safety under normal conditions of use even after the product has been authorized and subject to the introduction of specific procedures.

This may arise when the intended indications are very rare and, in the present state of scientific knowledge, it is not possible to provide comprehensive information, or when generating data may be contrary to generally accepted ethical principles.

This type of marketing authorization is close to a conditional marketing authorization as it is reserved to medicinal products to be approved for severe diseases or unmet medical needs and the applicant does not hold the complete data set legally required for the grant of a marketing authorization.

However, unlike a conditional marketing authorization, the applicant does not have to provide the missing data and will never have to.

Although a marketing authorization “under exceptional circumstances” is granted definitively, the risk-benefit balance of the medicinal product is reviewed annually, and the marketing authorization may be withdrawn where the risk-benefit ratio is no longer favorable.

We may not be able to obtain or maintain orphan drug designations for seralutinib, and we may be unable to maintain the benefits associated with orphan drug designation, including the potential for market exclusivity.

Regulatory authorities in some jurisdictions, including the United States and the EU, may designate drugs for relatively small patient populations as orphan drugs.

Under the Orphan Drug Act of 1983, the FDA may designate a product as an orphan product if it is intended to treat a rare disease or condition, which is generally defined as a patient population of fewer than 200,000 individuals in the United States, or a patient population of greater than 200,000 individuals in the United States,

but for which there is no reasonable expectation that the cost of developing the drug will be recovered from sales in the United States.

In the EU, the EC grants orphan designation based on the EMA’s Committee for Orphan Medicinal Products’ opinion to promote the development of products (1) that are intended for the diagnosis, prevention or treatment that is life-threatening or chronically debilitating, and (2) either (a) such condition affects no more than five in 10,000 persons in the EU when the application is made, or (b) the product, without the benefits derived from orphan status, would be unlikely to generate sufficient returns in the EU to justify the necessary investment, and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU, or, if such a method exists, the medicine must be of significant benefit to those affected by the condition.

We have received orphan drug designation in the United States and the EU for seralutinib for treatment of PAH and may seek additional orphan designations for seralutinib in the future.

We have received orphan drug designation in the United States, the EU and Japan for seralutinib for treatment of PAH and may seek additional orphan designations for seralutinib in the future.

There can be no assurance that we will be able to maintain or obtain such designations.

In the United States, orphan designation entitles a party to financial incentives such as opportunities for grant funding toward clinical trial costs, tax advantages and user-fee waivers.

In addition, if a product candidate that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity or where the manufacturer is unable to assure sufficient product quantity.

In addition, if a product candidate that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same indication or use within the relevant disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity within the relevant indication or use or where the manufacturer is unable to assure sufficient product quantity to meet the needs relating to the indication or use protected by orphan exclusivity.

Upon grant of a marketing authorization in the EU, orphan medicinal products are entitled to ten years of market exclusivity, during which time no similar medicinal product for the same indication may be placed on the market.

This period may be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the orphan designation criteria, including where it is shown that the product is sufficiently profitable not to justify maintenance of market exclusivity or where the prevalence of the condition has increased above the threshold.

Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition.

Even after an orphan drug is approved, the FDA or comparable foreign regulatory authority can subsequently approve the same drug for the same condition if such regulatory authority concludes that the later drug is clinically superior if it is shown to be safer, more effective or makes a major contribution to patient care.

Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugs can be approved for the same indications or uses.

Even after an orphan drug is approved, the FDA or comparable foreign regulatory authority can subsequently approve the same drug for the same indication or use if such regulatory authority concludes that the later drug is clinically superior if it is shown to be safer, more effective or makes a major contribution to patient care with respect to the indication or use covered by orphan exclusivity.

Orphan drug designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.

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Interim, topline and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data or cause us not to proceed into further clinical development.

From time to time, we may publicly disclose preliminary or topline or data from our clinical studies, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial.

From time to time, we may publicly disclose preliminary or topline data from our clinical studies, such as the recent announcement of our PROSERA Phase 3 topline results, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial.

We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data.

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From time to time, we may also disclose interim data from our clinical studies.

Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available.

Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient

enrollment continues and more patient data become available.

Adverse differences between topline, preliminary or interim data and final data could significantly harm our business prospects.

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If the topline, preliminary or interim data that we report differ from actual results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for, and commercialize, seralutinib may be harmed, which could harm our business, results of operations, prospects or financial condition.

Disruptions at the FDA and other government agencies caused by funding shortages, staffing limitations or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, cleared or approved or commercialized in a timely manner or at all, which could negatively impact our business.

Disruptions at the FDA and other government agencies caused by funding shortages, staffing limitations or policy changes could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, cleared or approved or commercialized in a timely manner or at all, which could negatively impact our business.

The ability of the FDA and foreign regulatory authorities to review and clear or approve new products can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory, and policy changes, the FDA’s or foreign regulatory authorities’ ability to hire and retain key personnel and accept the payment of user fees, and other events that may otherwise affect the FDA’s ability to perform routine functions.

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government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical activities.

Separately, in response to the COVID-19 pandemic, the FDA postponed most inspections of domestic and foreign manufacturing facilities at various points.

If a prolonged government shutdown occurs, or if staffing or funding shortages or renewed global health concerns prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

In addition, the current U.S.

Presidential administration has issued certain policies and Executive Orders directed towards reducing the employee headcount and costs associated with U.S.

administrative agencies, including the FDA, which have led to substantial personnel changes, and it remains unclear the degree to which these efforts may limit or otherwise adversely affect the FDA’s ability to conduct routine activities.

If a prolonged government shutdown occurs, or if funding shortages, staffing limitations or similar factors hinder or prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, such events could significantly impact the ability of the FDA or other such regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Our business is subject to risks arising from pandemic and epidemic diseases.

Any future pandemic or epidemic disease outbreaks, and any supply chain disruptions or staffing shortages, could disrupt the manufacture or shipment of supplies of seralutinib for use in our research and clinical trials, delay, limit or prevent our employees and CROs from continuing or timely advancing research and development activities, impede our clinical trial initiation and recruitment and the ability of subjects to continue in clinical trials, impact the results of the clinical trial based on participants contracting the disease or otherwise increasing the number of observed adverse events, impede testing, monitoring, data collection and analysis and other related activities, any of which could delay our clinical trials and increase our development costs, and have a material adverse effect on our business, financial condition and results of operations.

Any future pandemic or future epidemic disease outbreaks could also potentially further affect the business of the FDA or other regulatory authorities, which could result in delays in meetings related to planned clinical trials or other regulatory matters.

Any future pandemic or future epidemic disease outbreaks could also potentially further affect the business of the FDA or other regulatory authorities, which could result in delays in meetings related to future clinical trials or other regulatory matters.

Risks Related to Our Reliance on Third Parties

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These CROs, investigators and other third parties play a significant role in the conduct and timing of these trials and subsequent collection and analysis of data.

While we have agreements governing the activities of our third-party contractors, we have limited influence over their actual performance.

While we have agreements governing the

activities of our third-party contractors, we have limited influence over their actual performance.

Nevertheless, we are responsible for ensuring that each of our clinical trials is conducted in accordance with the applicable protocol and legal, regulatory and scientific standards, and our reliance on the CROs and other third parties does not relieve us of our regulatory responsibilities.

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On May 3, 2024, we entered into the collaboration agreement with Chiesi for the development and commercialization of seralutinib around the world, and we may in the future seek to enter into other collaborations, joint ventures, licenses and other similar arrangements for the development or commercialization of our product candidates, due to capital costs required to develop or commercialize such product candidates or manufacturing constraints.

For additional information regarding our collaboration with Chiesi, see the section titled “Business—License and Collaboration Agreements” included in this Form 10-K.

For additional

information regarding our collaboration with Chiesi, see the section titled “Business—License and Collaboration Agreements” included in this Form 10-K.

We may not be successful in our efforts to establish or maintain collaborations, including our collaboration with Chiesi, because third parties may not view our product candidates as having the requisite potential to demonstrate safety and efficacy or significant commercial opportunity.

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The European Commission’s proposal for revision of several legislative instruments related to medicinal products (potentially reducing the duration of regulatory data protection, revising the eligibility for expedited pathways, etc.) was published on April 26, 2023.

The proposed revisions remain to be agreed and adopted by the European Parliament and European Council and the proposals may therefore be substantially revised before adoption, which is not anticipated before 2026.

The revisions may however have a significant impact on the biopharmaceutical industry in the long term.

The proposed changes were since discussed and negotiated by the European Parliament and the Council of the EU as part of the EU ordinary legislative process.

A provisional agreement has been reached by the European Parliament and Council of the EU on the proposed revisions on December 11, 2025.

The proposed revisions (affecting the duration of regulatory data protection and market protection, including for orphan medicinal products, revising the eligibility for expedited pathways, etc.) remain to be formally adopted by the two institutions, which is not anticipated before early 2026.

The proposed changes are not expected to enter into application before 2028 and may however have a significant impact on the biopharmaceutical industry in the long term.

We also cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action, either in the United States or abroad.

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Even if seralutinib receives regulatory approval, it may not gain market acceptance among physicians, patients, healthcare payors or the medical community.

The commercial success of

seralutinib will depend significantly on the broad adoption and use of the resulting product by physicians and patients for approved indications.

The commercial success of seralutinib will depend significantly on the broad adoption and use of the resulting product by physicians and patients for approved indications.

The degree of market acceptance of seralutinib will depend on a number of factors, including:

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Our ability to achieve coverage and acceptable levels of reimbursement for seralutinib by third-party payors will have an effect on our ability to successfully commercialize seralutinib.

Even if we obtain coverage for seralutinib by a third-party payor, the resulting reimbursement payment rates may not be

adequate or may require co-payments that patients find unacceptably high.

Even if we obtain coverage for seralutinib by a third-party payor, the resulting reimbursement payment rates may not be adequate or may require co-payments that patients find unacceptably high.

We cannot be sure that coverage and reimbursement in the United States, the EU or elsewhere will be available for seralutinib, and any reimbursement that may become available may be decreased or eliminated in the future.

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Even if we are successful in demonstrating improved efficacy or improved convenience of administration with seralutinib, pricing of existing drugs may limit the amount we will be able to charge for seralutinib.

These payors may deny or revoke the reimbursement status of seralutinib or establish prices for new or existing marketed products at levels that are too low to enable us to realize an appropriate return on our investment in product development.

If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize seralutinib and may not be able to obtain a satisfactory financial return on seralutinib.

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In the United States, third-party payors, including private and governmental payors, such as the Medicare and Medicaid programs, play an important role in determining the extent to which new drugs will be covered.

Some third-party payors may require pre-approval of coverage for new or innovative devices or drug therapies before they will reimburse healthcare providers who use such therapies.

Some third-party payors may require pre-approval of coverage for new or innovative devices or drug therapies before they will reimburse

healthcare providers who use such therapies.

It is difficult to predict at this time what third-party payors will decide with respect to the coverage and reimbursement for seralutinib.

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Our competitors include larger and better funded pharmaceutical, biopharmaceutical, biotechnological and therapeutics companies.

Moreover, we may also compete with

universities and other research institutions who may be active in the indications we are targeting and could be in direct competition with us.

Moreover, we may also compete with universities and other research institutions who may be active in the indications we are targeting and could be in direct competition with us.

We also compete with these organizations to recruit management, scientists and clinical development personnel, which could negatively affect our level of expertise and our ability to execute our business plan.

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Smaller or early stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

We expect to face competition for seralutinib from existing products and products in development.

We expect to face competition for seralutinib and RT234 from existing products and products in development.

Seralutinib is a PDGFR, CSF1R and c-KIT inhibitor initially targeted for PAH and PH-ILD patients.

We expect competition within the PAH indication will include prostanoids / prostacyclin receptor agonists, including Orenitram (United Therapeutics), Uptravi (Janssen), Tyvaso (United Therapeutics), and Remodulin (United Therapeutics), and activin ligand traps, including Winrevair (Merck).

We also may face some competition from products used in Functional Class I and II patients, such as the oral PDE5 inhibitors, including Revatio (Pfizer Inc.) and Adcirca (United Therapeutics);

We expect competition within the PAH indication will include prostanoids / prostacyclin receptor agonists, including Orenitram (United Therapeutics), Uptravi (Janssen), Tyvaso (United Therapeutics), Yutrepia (Liquidia) and Remodulin (United Therapeutics), and activin ligand traps, including Winrevair (Merck).

We also may face some competition from products used as frontline therapy for PAH, such as the oral PDE5 inhibitors, including Revatio (Pfizer Inc.) and Adcirca (United Therapeutics);

the sGC stimulator Adempas (Bayer AG);

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We believe that, if approved, seralutinib could be used alongside all classes of approved therapies.

PAH is also an active indication for investigational drugs, and we may face competition in the future from CS1 (Cereno Scientific), L606 (Liquidia / Pharmosa Biopharm Inc.), treprostinil palmitil (Insmed), ralinepag (United Therapeutics), and REGN13335 (Regeneron Pharmaceuticals, Inc.).

Additionally, although not approved for the treatment of PAH, we may face competition from formulations of imatinib, including the one in development from Tenax Therapeutics and Inhibikase Therapeutics.

We expect to face competition from Tyvaso (United Therapeutics) within the PH-ILD indication, as it is the only approved therapy for PH-ILD in the United States.

PAH is also an active indication for investigational drugs, and we may face competition in the future from L606 (Liquidia / Pharmosa Biopharma Inc.), CS1 (Cereno Scientific), treprostinil palmitil inhalation powder (Insmed, Inc.), ralinepag (United Therapeutics), REGN13335 (Regeneron), HS235

(35Pharma, Inc.), LTP001 (Novartis), APL‑9796 (Apollo Therapeutics Ltd), and ROC‑101 (AllRock Bio, Inc.).

Additionally, although not approved for the treatment of PAH, we may face competition from formulations of imatinib, including the one in development from Inhibikase Therapeutics.

While there are multiple classes of therapies with marketing approval for PAH, there are currently no therapies approved for PRN use to provide rapid, on‑demand symptom relief.

We expect to face competition from Tyvaso (United Therapeutics) and Yutrepia (Liquidia) within the PH-ILD indication, as they are the only approved therapies for PH-ILD in the United States.

There are no approved therapies for PH-ILD in the EU.

PH-ILD is also an active indication for investigational drugs, and we may face competition in the future from L606 (Liquidia / Pharmosa Biopharm Inc.), sirolimus (OrphAI Therapeutics), treprostinil palmitil (Insmed, Inc.), MK-5475 (Merck), and mosliciguat (Pulmovant, Inc.).

PH-ILD is also an active indication for investigational drugs, and we may face competition in the future from L606 (Liquidia / Pharmosa Biopharma Inc.), sirolimus (OrphAI Therapeutics), treprostinil palmitil inhalation powder (Insmed, Inc.), mosliciguat (Pulmovant, Inc.), mirivadelgat (ForeSee Pharmaceuticals Co., Ltd.), APL‑9796 (Apollo Therapeutics Ltd), and ROC‑101 (AllRock Bio, Inc.).

While there is one class of therapy with marketing approval for PH-ILD, there are currently no therapies approved for PRN use to provide rapid, on‑demand symptom relief.

There may be other earlier stage clinical programs that, if approved, would compete with seralutinib.

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Further, new trials may change the estimated incidence or prevalence of these diseases.

For example, seralutinib demonstrated a more pronounced clinical response profile across the primary and key secondary endpoints in a subset of intermediate- and high-risk PAH patients, and it is possible that any approval we obtain for seralutinib may be limited to this or another subset of patients.

The total addressable market of seralutinib will ultimately depend upon, among other things, the diagnosis criteria included in the final label for seralutinib, the availability of alternative treatments and the safety, convenience, cost and efficacy of seralutinib relative to such alternative treatments, acceptance by the medical community and patient access, drug pricing and reimbursement.

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Although we have started to build a commercial infrastructure, we have no formal internal sales, marketing or distribution capabilities, nor have we commercialized a product.

third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or in lieu of our own sales force and distribution systems.

If seralutinib ultimately receives regulatory approval, we, in collaboration with Chiesi, must build a marketing and sales organization with technical expertise and supporting distribution capabilities to commercialize seralutinib in the United States, which will be expensive and time consuming, or collaborate with third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or in lieu of our own sales force and distribution systems.

We have no prior experience as a company in the marketing, sale and distribution of biopharmaceutical products, and there are significant risks involved in building and managing a sales organization, including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team.

Any failure or delay in the development of our internal sales, marketing and distribution capabilities would adversely impact the commercialization of seralutinib.

For example, if we are unable to raise additional capital, our ability to build a commercial infrastructure to commercialize seralutinib may be significantly delayed, if seralutinib receives regulatory approval.

We may not be able to enter into collaborations or hire consultants or external service providers to assist us in sales, marketing and distribution functions on acceptable financial terms, or at all.

In addition, our product revenues and our profitability, if any, may be lower if we rely on third parties for these functions than if we were to market, sell and distribute seralutinib.

We likely will have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market seralutinib effectively.

We likely will have little control over such third parties, and any of them may fail to devote the necessary resources

and attention to sell and market seralutinib effectively.

If we are not successful in commercializing seralutinib, either on our own in partnership with Chiesi or through arrangements with one or more third parties, we may not be able to generate any future product revenue, and we would incur significant additional losses.

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Chiesi is not permitted to market or promote seralutinib before we receive regulatory approval from applicable regulatory authorities in foreign markets, and we may never receive such regulatory approvals for seralutinib.

For example, we recently reported that our PROSERA Phase 3 clinical trial that did not meet the prespecified threshold on the primary endpoint, and it is unclear whether the FDA or comparable regulatory authorities in foreign markets will view such data as sufficient to support approval.

In addition, Chiesi may ultimately choose not to seek regulatory approval in certain or all foreign markets.

To obtain separate regulatory approval in many other countries, Chiesi must comply with numerous and varying regulatory requirements regarding safety and efficacy and governing, among other things, clinical trials, commercial sales, pricing and distribution of seralutinib.

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If we are not able to attract, integrate, retain and motivate necessary personnel to accomplish our business objectives, we may experience constraints that will significantly impede the achievement of our development objectives, our ability to raise additional capital and our ability to implement our business strategy.

We may encounter difficulties in managing our growth and expanding our operations successfully.

We had 144 full-time employees as of March 6, 2025.

As we continue development and pursue the potential commercialization of seralutinib, as well as function as a public company, we may need to expand our financial, development,

regulatory, manufacturing, marketing and sales capabilities or contract with third parties to provide these capabilities for us.

We may encounter difficulties in managing our growth and expanding our operations successfully, and internal restructuring activities may result in disruptions to our business or otherwise materially harm our results of operations or financial conditions.

We recently announced workforce reductions of approximately 77 individuals, or approximately 48% of our workforce, intended to preserve cash while maintaining core capabilities as we explore the potential for FDA approval of seralutinib in PAH.

From time to time, we may undertake additional internal restructuring activities as we continue to evaluate and attempt to optimize our cost and operation structure in light of regulatory developments as we pursue FDA approval of seralutinib.

We also may not realize the benefits expected from such workforce reduction or any future workforce reductions, including our ability to conserve cash.

In addition, such actions may make it more difficult to retain key personnel.

reduction-in-force may result in unintended consequences and costs, such as the loss of institutional knowledge and expertise and decreased morale among our remaining employees.

In addition, internal restructurings can require a significant amount of time and focus from management and other employees, which may divert attention from our core operating activities.

Further, there can be no assurance that any particular course of action, development path, business arrangement or transaction, or series of transactions, will be pursued, successfully consummated or lead to increased stockholder value.

As we continue development and pursue the potential commercialization of seralutinib, as well as function as a public company, we may also need to expand our financial, development, regulatory, manufacturing, marketing and sales capabilities or contract with third parties to provide these capabilities for us.

If our operations expand, we expect that we will need to manage additional relationships with various strategic partners, suppliers and other third parties.

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Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

• the federal Physician Payments Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the Centers for Medicare and Medicaid Services, or CMS, information related to payments and other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician practitioners (physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiology assistants and certified nurse-midwives), and teaching hospitals, as well as ownership and investment interests held by the physicians described above and their immediate family members;

• analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to our business practices, including but not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed by non- governmental third-party payors, including private insurers, or by the patients themselves;

• the federal Physician Payments Sunshine Act, which requires certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to the Centers for Medicare and Medicaid Services, or CMS, information related to payments and other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician practitioners (physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anaesthesiology assistants and certified nurse-midwives), and teaching hospitals, as well as ownership and investment interests held by the physicians described above and their immediate family members;

and marketing arrangements and claims involving healthcare items or services reimbursed by non- governmental third-party payors, including private insurers, or by the patients themselves;

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, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources;

state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information or which require tracking gifts and other remuneration

and items of value provided to physicians, other healthcare providers and entities;

state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information or which require tracking gifts and other remuneration and items of value provided to physicians, other healthcare providers and entities;

and state and local laws that require the registration of pharmaceutical sales representatives.

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In the United States, HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, and regulations promulgated thereunder, or collectively, HIPAA, imposes requirements relating to the privacy, security and transmission of individually identifiable health information held by covered entities and their business associates.

We do not believe that we are currently acting as a covered entity or business associate under HIPAA and thus are not directly subject to its requirements or penalties.

However, depending on the facts and circumstances, we could face substantial criminal penalties if we knowingly receive individually identifiable health information from a HIPAA-covered healthcare provider or research institution that has not satisfied HIPAA’s requirements for disclosure of individually identifiable health information.

We do not believe that we are currently acting as a covered entity or business associate under HIPAA, other than potentially with respect to providing certain employee benefits.

We may, however, obtain health information from third parties (including research institutions from which we obtain clinical trial data) that are subject to privacy and security requirements under HIPAA.

Depending on the facts and circumstances, we could be subject to significant penalties if we knowingly obtain or disclose individually identifiable health information maintained by a HIPAA covered entity in a manner that is not authorized or permitted by HIPAA.

In addition, state laws govern the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same requirements, thus complicating compliance efforts.

Further, we may also be subject to other state laws governing the privacy, processing and protection of personal information.

By way of example, California enacted the California Consumer Privacy Act, as amended by the California Privacy Rights Act, or collectively, the CCPA, requires covered businesses that process the personal information of California residents to, among other things:

residents to, among other things:

(i) provide certain disclosures to California residents regarding the business’s collection, use, and disclosure of their personal information;

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Our operations abroad may also be subject to increased scrutiny or attention from data protection authorities.

For example, in Europe, the General Data Protection Regulation, or GDPR, went into effect in May 2018, and imposes stringent requirements for controllers and processors of personal data.

For example, we may be subject to the European Union General Data Protection Regulation, or the EU GDPR, and to the United Kingdom General Data Protection Regulation and Data Protection Act 2018, or collectively, the UK GDPR, and the EU GDPR and UK GDPR together referred to as the GDPR.

The GDPR imposes stringent requirements for controllers and processors of personal data.

The GDPR allows EU and EEA member states to make additional laws and regulations further limiting the processing of genetic, biometric or health data.

Companies that must comply with the GDPR face increased compliance obligations and risk, including more robust regulatory enforcement of data protection requirements and potential fines for noncompliance of up to €20 million or 4% of the annual global revenues of the noncompliant company, whichever is greater.

Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States, and the efficacy and longevity of current transfer mechanisms between the EEA, and the United States remains uncertain.

Companies that must comply with the GDPR face increased compliance obligations and risk, including more robust regulatory enforcement of data protection requirements and potential fines for noncompliance of up to €20 million / £17.5 million or 4% of the annual global revenues of the noncompliant company, whichever is greater.

Case law from the Court of Justice of the European Union, or CJEU, states that reliance on the standard contractual clauses, or SCCs - a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism - alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis.

On July 10, 2023, the European Commission adopted its Adequacy Decision in relation to the new EU-US Data Privacy Framework, or DPF, rendering the DPF effective as a GDPR transfer mechanism to U.S.

entities self-certified under the DPF.

As supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the SCCs cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

Since the beginning of 2021, we have also been subject to the United Kingdom’s data protection regime, which imposes separate but similar obligations to those under the GDPR and comparable penalties, including fines of up to £17.5 million or 4% of a noncompliant company’s global annual revenue for the preceding financial year, whichever is greater.

On October 12, 2023, the UK Extension to the DPF came into effect (as approved by the United Kingdom Government), as a data transfer mechanism from the United Kingdom to U.S.

entities self-certified under the DPF.

We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue and international transfers to the United States and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators.

As the regulatory guidance and enforcement landscape in relation to data transfers continue to develop, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we operate our business, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

Other foreign jurisdictions, such as China and Russia, are increasingly implementing or developing their own privacy regimes with complex and onerous compliance obligations and robust regulatory enforcement powers.

As we continue to expand into other foreign countries and jurisdictions, we may be subject to additional laws and regulations that may affect how we conduct business.

Recently enacted legislation, future legislation and healthcare reform measures may increase the difficulty and cost for us to obtain marketing approval for and commercialize seralutinib and may affect the prices we may set.

Further, in 2024, the National Security Division of the U.S.

Department of Justice, or the DOJ, issued a new rule—referred to as the “Data Security Program,” or the DSP —to implement Executive Order 14117 aimed at preventing access to “bulk U.S.

sensitive personal data” and “government-related data” by “countries of concern” (including China, Russia, Iran, North Korea, Cuba, and Venezuela) and “covered persons” (as all such terms are defined in the DSP).

Effective as of April 8, 2025, and fully enforceable as of July 9, 2025, the DSP imposes stringent obligations on companies within its scope and prohibits or restricts “covered data transactions” that grant countries of concern or covered persons access to bulk U.S.

sensitive personal data or any amount of government-related data.

The DSP is new, complex and has yet to be enforced, and as such, there is a risk that our interpretation of its applicability, scope, and requirements is incorrect, incomplete, or misapplied.

Compliance with the DSP may require us to invest heavily in data security and compliance measures, such as implementing and complying with the Cybersecurity and Infrastructure Security Agency’s guidelines and other burdensome recordkeeping, reporting, and auditing requirements.

It may also require us to implement new processes, stop or restrict certain data transfers, alter the geographic scope of our operations, cease doing business with certain third parties or using certain tools or vendors, or change how data flows throughout our business, any of which could materially impact our business operations or hinder our ability to grow our business.

Finally, non-compliance with the DSP could result in significant civil or criminal penalties, which could materially adversely affect our business, results of operations, and financial condition.

In addition, we selectively use artificial intelligence, or AI, in our business.

The regulatory framework for AI is rapidly evolving as many federal, state, and foreign government bodies and agencies have introduced or are currently considering additional laws and regulations.

Additionally, existing laws and regulations may be interpreted in ways that would affect the operation of AI.

As a result, implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future, and we cannot yet determine the impact future laws, regulations, standards, or market perception of their requirements may have on our business and may not always be able to anticipate how to respond to these laws or regulations.

Further, the cost to comply with such laws, regulations, or decisions and/or guidance interpreting existing laws, could be significant and would increase our operating expenses (such as by imposing additional reporting obligations regarding our use of AI).

Such an increase in operating expenses, as well as any actual or perceived failure to comply with such laws and regulations, could adversely affect our business, financial condition and results of operations.

Current and future healthcare reform legislation or regulation may increase the difficulty and cost for us to obtain marketing approval for and commercialize seralutinib and may affect the prices we may obtain and may have a negative impact on our business and results of operations.

In the United States and some foreign jurisdictions, there have been, and we expect there will continue to be, a number of legislative and regulatory changes to the healthcare system, including cost-containment measures that may reduce or limit coverage and reimbursement for newly approved drugs and affect our ability to profitably sell any product candidates for which we obtain marketing approval.

Among policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and/or expanding access.

In the United States and elsewhere, the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative and regulatory initiatives.

We expect that current laws and regulations, as well as other healthcare reform measures that may be adopted in the future, may result in more rigorous coverage criteria and additional downward pressure on the price that we may receive for seralutinib.

In particular, there have been and continue to be a number of initiatives at the U.S.

federal and state levels that seek to reduce healthcare costs and improve the quality of healthcare.

For example, in March 2010, the ACA was enacted in the United States.

For example, in 2010, the ACA was enacted in the United States.

Among the provisions of the ACA of importance to seralutinib, the ACA:

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extended manufacturers’ Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations;

expanded eligibility criteria for Medicaid programs;

expanded the entities eligible for discounts under the Public Health program;

increased the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program;

established a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in and conduct comparative clinical effectiveness research, along with funding for such research;

and established a Center for Medicare and Medicaid Innovation at CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending.

established a new Patient-Centered Outcomes Research Institute to oversee, and established a Center for Medicare and Medicaid Innovation at CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending.

Since its enactment, there have been judicial and political challenges to certain aspects of the ACA.

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In addition, other legislative changes have been proposed and adopted since the ACA was enacted.

On August 2, 2011, the Budget Control Act of 2011 was signed into law, which, among other things, resulted in reductions to Medicare payments to providers, which went into effect on April 1, 2013, and, due to subsequent legislative amendments to the statute, will remain in effect through 2032, with the exception of a temporary suspension from May 1, 2020, through March 31, 2022, unless additional Congressional action is taken.

On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, reduced Medicare payments to several providers, including hospitals, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

In addition, on March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, which eliminated the statutory Medicaid drug rebate cap, beginning January 1, 2024.

The Budget Control Act of 2011, among other things, resulted in reductions to Medicare payments to providers, which went into effect on April 1, 2013, and, due to subsequent legislative amendments to the statute, will remain in effect through 2032, unless additional Congressional action is taken.

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

In addition, the American Rescue Plan Act of 2021 eliminated the statutory Medicaid drug rebate cap, beginning January 1, 2024.

The rebate was previously capped at 100% of a drug’s average manufacturer price.

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Such scrutiny has resulted in several recent congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products.

On August 16, 2022, the Inflation Reduction Act of 2022, or IRA, was enacted into law.

Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), 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 (which began in 2025).

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

CMS has published the negotiated prices for the initial ten drugs, which will first be effective in 2026, and the list of the subsequent 15 drugs that will be subject to negotiation, although the Medicare drug price negotiation program is currently subject to legal challenges.

For that and other reasons, it is currently unclear how the IRA will be effectuated.

The Inflation Reduction Act, or IRA, was enacted in 2022.

This statute marks the most significant action by Congress with respect to the pharmaceutical industry since adoption of the ACA in 2010.

Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare, 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);

redesigns the Medicare Part D benefit (beginning in 2024);

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

CMS has published the negotiated prices for the initial ten drugs, which became effective in 2026, and the subsequent 15 drugs, which will first be effective in 2027.

CMS has also published the next set of 15 drugs that will be subject to negotiation.

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.

HHS has and will continue to issue and update guidance as these programs are implemented, although the Medicare drug price negotiation program is currently subject to legal challenges.

The impact of the IRA on us and the pharmaceutical industry cannot yet be fully determined, but is likely to be significant.

In addition, the One Big Beautiful Bill Act, which was enacted in July 2025, imposes significant reductions in the funding of the Medicaid program.

Such reductions are expected to decrease the number of persons enrolled in Medicaid and reduce the services covered by Medicaid, which could adversely affect our ability to generate revenue, attain profitability or commercialize seralutinib.

Furthermore, the Trump administration is pursuing a two-fold strategy to reduce drug costs in the U.S.

While it is unclear whether and how the Trump proposals will be implemented, the Trump policies are likely to have a negative impact on the pharmaceutical industry and on our ability to receive adequate revenues for seralutinib.

On the one hand, President Trump has threatened to impose significant tariffs on pharmaceutical manufacturers that do not adopt pricing policies such as most favored nation pricing, which would tie the price for drugs in the U.S.

to the lowest price in a group of other countries.

In response, multiple manufacturers have reportedly entered into confidential pricing agreements with the federal government.

On the other hand, the Trump administration is pursuing traditional regulatory pathways to impose drug pricing policies, and published two proposed regulations in December 2025, referred to as Globe and Guard.

If finalized, these regulations would implement mandatory payment models under which manufacturers of eligible drugs would be required to pay rebates to the federal government on a portion of the units of their drugs that are reimbursed by Medicare, with the rebate amount based on most favored nation pricing.

Imposing a rebate in the U.S.

that is based on drug prices outside the U.S.

would mark a drastic and unprecedented shift in the U.S.

pharmaceutical market, and while the impact of the Globe and Guard proposed regulations, if finalized, cannot yet be determined, it is likely to be significant.

Even regulatory proposals or executive actions that are ultimately deemed unlawful could negatively impact the U.S.

pharmaceutical sector and our business.

In addition, pharmaceutical pricing and marketing has long been the subject of considerable discussion in Congress and among policymakers, and it is possible that Congress could enact additional laws that negatively affect the pharmaceutical industry.

We expect that new laws and other healthcare reform measures that may be adopted in the future may result in additional reductions in Medicare and other healthcare funding, more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price that we receive for any approved product.

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At the state level, legislatures have increasingly passed legislation and implemented 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, drug price reporting and other transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

Some states have enacted legislation creating so-called prescription drug affordability boards, which ultimately may attempt to impose price limits on certain drugs in these states.

Some states have enacted legislation creating so-called prescription drug affordability boards, which ultimately may attempt to impose price limits on certain drugs in these states, and at least one state board is imposing an upper payment limit.

States are also seeking to implement general, across the board price caps for pharmaceuticals, or are seeking to regulate drug distribution.

Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, results of operations, financial condition and prospects.

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For example, we may be sued if seralutinib allegedly causes injury or is found to be otherwise unsuitable during product testing, manufacturing, marketing or sale.

Any such product liability claims may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in seralutinib, negligence, strict liability and a breach of warranties.

Any such product liability claims may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in seralutinib, negligence, strict

liability and a breach of warranties.

Claims may be brought against us by clinical trial participants, patients or others using, administering or selling products that may be approved in the future.

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Misconduct by these parties could include intentional, reckless and/or negligent conduct or disclosure of unauthorized activities to us that violate:

(1) the laws and regulations of the FDA and other similar regulatory requirements, including those laws that require the reporting of true, complete and accurate information to such authorities, (2) manufacturing standards, including cGMP and similar requirements, (3) federal and state data privacy, security, fraud and abuse and other healthcare laws and regulations in the United States and abroad or (4) laws that require the true, complete and accurate reporting of financial information or data.

abroad or (4) laws that require the true, complete and accurate reporting of financial information or data.

Activities subject to these laws also involve the improper use or misrepresentation of information obtained in the course of clinical trials, the creation of fraudulent data in our preclinical studies or clinical trials, or illegal misappropriation of drug product, which could result in regulatory sanctions and cause serious harm to our reputation.

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If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business and financial results, including, without limitation, the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgements, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, individual imprisonment, contractual damages, reputational harm, diminished profits and future earnings, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, and curtailment of our operations, any of which could adversely affect our ability to operate our business and our results of operations.

We may engage in strategic transactions that could impact our liquidity, increase our expenses and present significant distractions to our management.

We have in the past, and may in the future, engage in strategic transactions that could impact our liquidity, increase our expenses and present significant distractions to our management.

From time to time, we may consider strategic transactions, such as acquisitions of companies, asset purchases and out-licensing or in-licensing of intellectual property, products or technologies, similar to our approach in in-licensing seralutinib.

For example, in September 2025, we announced that we entered into an option agreement to acquire Respira Therapeutics and its lead product candidate.

Under the agreement, we committed to funding certain pre-agreed development expenses for up to approximately two years.

If we exercise the option and pursue additional development of such product candidate, the development expenses may increase significantly.

Any future transactions could increase our near and long-term expenditures, result in potentially dilutive issuances of our equity securities, including our common stock, or the incurrence of debt, contingent liabilities, amortization expenses or acquired in process research and development expenses, any of which could affect our financial condition, liquidity and results of operations.

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Future acquisitions may also require us to obtain additional financing, which may not be available on favorable terms or at all.

These transactions may never be successful and may require significant time and attention of management.

These transactions may never be successful and may require significant time and attention from management.

In addition, the integration of any business that we may acquire in the future may disrupt our existing business and may be a complex, risky and costly endeavor for which we may never realize the full benefits of the acquisition.

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Although we own issued patents in the United States and foreign countries, we cannot be certain that the claims in our U.S.

pending patent applications and patent applications in foreign countries and jurisdictions will be considered patentable by the United States Patent and Trademark Office, or USPTO, courts in the United States or by the patent offices and courts in foreign countries and jurisdictions, nor can we be certain that the claims in our issued patents will not be found invalid or unenforceable if challenged.

courts in foreign countries and jurisdictions, nor can we be certain that the claims in our issued patents will not be found invalid or unenforceable if challenged.

The patent application process is subject to numerous risks and uncertainties, and there can be no assurance that we or any of our potential future collaborators will be successful in protecting seralutinib by obtaining and defending patents.

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This license agreement imposes, and we expect that any future license agreements where we in-license intellectual property, will impose on us, various development, regulatory and/or commercial diligence obligations, payment of milestones and/or royalties and other obligations.

If we fail to

comply with our obligations under these agreements, or we are subject to bankruptcy-related proceedings, the licensor may have the right to terminate the license, in which event we would not be able to market products covered by the license.

Additionally, our existing license agreement with Pulmokine includes sublicenses from a third party who is not the original licensor of the seralutinib intellectual property.

If we fail to comply with our obligations under these agreements, or we are subject to bankruptcy-related proceedings, the licensor may have the right to terminate the license, in which event we would not be able to market products covered by the license.

Additionally, our existing license agreement with Pulmokine includes sublicenses from a third party who is not the original

licensor of the seralutinib intellectual property.

Under this agreement, we must rely on Pulmokine to comply with its obligations under the primary license agreements under which it obtained rights in the applicable intellectual property, where we do not have a relationship with the original licensor of such rights.

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Moreover, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted after issuance.

third parties from competing with us, or otherwise provide us with any competitive advantage.

Even if patent applications we own or license currently or in the future issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent competitors or other third parties from competing with us, or otherwise provide us with any competitive advantage.

Any patents that we own or license may be challenged or circumvented by third parties or may be narrowed or invalidated as a result of challenges by third parties.

Consequently, we do not know whether seralutinib will be protectable or remain protected by valid and enforceable patents.

Consequently, we do not know whether seralutinib will be protectable or remain protected by valid and enforceable

Our competitors or other third parties may be able to circumvent our patents by developing similar or alternative technologies or products in a non-infringing manner which could materially adversely affect our business, financial condition, results of operations and prospects.

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Any of these outcomes could impair our ability to prevent competition from third parties, which may have an adverse impact on our business.

Pursuant to the terms of the license agreement with Pulmokine, Gilead Sciences and Rensselaer the licensors may have the right to control enforcement of our licensed patents or defense of any claims asserting the invalidity of these patents and even if we are permitted to pursue such enforcement or defense, we will require the cooperation of our licensors.

Pursuant to the terms of the license agreement with Pulmokine, Gilead Sciences and the Rensselaer Center for Translational Research, Inc., the licensors may have the right to control enforcement of our licensed patents or defense of any claims asserting the invalidity of these patents and even if we are permitted to pursue such enforcement or defense, we will require the cooperation of our licensors.

We cannot be certain that our licensors will allocate sufficient resources or prioritize their or our enforcement of such patents or defense of such claims to protect our interests in the licensed patents.

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Our predecessors or licensors often retain certain rights under their agreements with us, including the right to use the underlying technology for noncommercial academic and research use, to publish general scientific findings from research related to the technology, and to make customary scientific and scholarly disclosures of information relating to the technology.

It is difficult

to monitor whether our predecessors or licensors limit their use of the technology to these uses, and we could incur substantial expenses to enforce our rights to our licensed technology in the event of misuse.

It is difficult to monitor whether our predecessors or licensors limit their use of the technology to these uses, and we could incur substantial expenses to enforce our rights to our licensed technology in the event of misuse.

If we are limited in our ability to utilize acquired or licensed technologies, or if we lose our rights to critical in-licensed technology, we may be unable to successfully develop, out-license, market and sell seralutinib, which could prevent or delay new product introductions.

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We cannot predict whether we would prevail in any such actions or that any license required under any of these patents would be made available on commercially acceptable terms, if at all.

Moreover, even if we or our future strategic partners were able to obtain a license, the

rights may be nonexclusive, which could result in our competitors gaining access to the same intellectual property.

Moreover, even if we or our future strategic partners were able to obtain a license, the rights may be nonexclusive, which could result in our competitors gaining access to the same intellectual property.

In addition, we cannot be certain that we could redesign seralutinib or processes to avoid infringement, if necessary.

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Derivation or interference proceedings may be necessary to determine priority of inventions, and an unfavorable outcome may require us to cease using the related technology or to attempt to license rights from the prevailing party.

Derivation or interference proceedings provoked by third parties or brought by us or declared by the USPTO or similar proceedings in foreign patent offices may be necessary to determine the priority of inventions with respect to our

patents or patent applications.

An unfavorable outcome could require us to cease using the related technology or to attempt to license rights to it from the prevailing party.

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Our defense of such proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees.

In addition, the uncertainties associated with such proceedings could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties or enter into development or manufacturing partnerships that would help us bring seralutinib to market.

In addition, the uncertainties associated with such proceedings could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research

programs, license necessary technology from third parties or enter into development or manufacturing partnerships that would help us bring seralutinib to market.

Recent patent reform legislation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents.

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Changes in either the patent laws or in the interpretations of patent laws in the United States and other countries may diminish the value of our intellectual property and may increase the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents.

We cannot predict the breadth of claims

that may be allowed or enforced in our patents or in third-party patents.

We cannot predict the breadth of claims that may be allowed or enforced in our patents or in third-party patents.

In addition, Congress or other foreign legislative bodies may pass patent reform legislation that is unfavorable to us.

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Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations.

In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained.

In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has

created uncertainty with respect to the value of patents, once obtained.

Depending on decisions by the U.S.

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The legal systems of many foreign countries do not favor the enforcement of patents and other intellectual property protection, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights.

Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against us.

being invalidated or interpreted narrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against us.

We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful.

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Litigation may be necessary to defend against these claims.

If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or

personnel, which could adversely affect our business.

If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel, which could adversely affect our business.

Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to our management team and other employees.

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The market price for our common stock may be influenced by those factors discussed in this “Risk Factors” section and many others, including:

• our ability to enroll subjects in our ongoing and planned clinical trials;

• an inability to obtain additional funding to fund continuing operations;

• the $200.0 million in aggregate principal amount of 5.00% convertible senior notes due May 2027;

• results of our clinical trials and preclinical studies, and the results of trials of our competitors or those of other companies in our market sector;

• regulatory approval of seralutinib, or limitations to specific label indications or patient populations for its use, or changes or delays in the regulatory review process;

• our ability to enroll subjects in our ongoing and future clinical trials;

• regulatory developments in the United States and foreign countries;

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• sales of our stock by insiders and stockholders;

• general economic, industry and market conditions other events or factors, many of which are beyond our control, such as health pandemics, the military conflict between Russia and Ukraine and Israel and Hamas, inflation and interest changes and financial institution instability;

• general economic, industry and market conditions other events or factors, many of which are beyond our control, such as health pandemics, military conflicts, state-sponsored hostilities, terrorist activities, inflation and interest changes and financial institution instability;

• additions or departures of key personnel;

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Our executive officers, directors and principal stockholders, if they choose to act together, have the ability to control or significantly influence all matters submitted to stockholders for approval.

Furthermore, many of our current directors were appointed by our principal stockholders.

Our executive officers, directors and greater than 5% stockholders, in the aggregate, own approximately 15.9% of our outstanding common stock as of March 10, 2026.

As a result, such persons or their appointees to our board of directors, acting together, have the ability to control or significantly influence all matters submitted to our board of directors or stockholders for approval, including the appointment of our management, the election and removal of directors and approval of any significant transaction, as well as our management and business affairs.

As a result, such persons or their appointees to our board of directors, acting together, have the ability to significantly influence all matters submitted to our board of directors or stockholders for approval, including the appointment of our management, the election and removal of directors and approval of any significant transaction, as well as our management and business affairs.

This concentration of ownership may have the effect of delaying, deferring or preventing a change in control, impeding a merger, consolidation, takeover or other business combination involving us, or discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of our business, even if such a transaction would benefit other stockholders.

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Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable and may lead to entrenchment of management.

Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that could significantly reduce the value of our shares to a potential acquiror or delay or prevent changes in control or changes in our management without the consent of our board of directors.

Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that could significantly reduce the value of our shares to a potential acquirer or delay or prevent changes in control or changes in our management without the consent of our board of directors.

The provisions in our charter documents include the following:

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• the required approval of at least 66-2/3% of the shares entitled to vote to remove a director for cause, and the prohibition on removal of directors without cause;

• the ability of our board of directors to authorize the issuance of shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquiror;

• the ability of our board of directors to alter our amended and restated bylaws without obtaining stockholder approval;

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• the requirement that a special meeting of stockholders may be called only by the board of directors, which may delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;

• advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquiror from conducting a solicitation of proxies to elect the acquiror’s own slate of directors or otherwise attempting to obtain control of us.

• advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of us.

We are also subject to the anti-takeover provisions contained in Section 203 of the Delaware General Corporation Law.

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Furthermore, our amended and restated bylaws also provide that unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.

These choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees,

which may discourage such lawsuits against us and our directors, officers and other employees.

These choice of forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and other employees.

By agreeing to this provision, however, stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.

Furthermore, the enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable.

Furthermore, the enforceability of similar choice of forum provisions in other companies’ certificates of

incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable.

If a court were to find the choice of forum provisions in our amended and restated certificate of incorporation or amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.

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To the extent that we continue to generate losses for tax purposes, such losses will carry forward to offset future taxable income, if any, until such losses are used to offset taxable income (if ever) or expire (if at all).

As of December 31, 2024, we had federal and state net operating loss carryforwards, or NOLs, of approximately $398.1 million and $3.3 million, respectively.

As of December 31, 2025, we had gross federal and state net operating loss carryforwards, or NOLs, of approximately $540.6 million and $10.2 million, respectively.

Our state NOLs that are subject to expiration will begin to expire in 2036, unless previously utilized.

Our federal NOLs are not subject to expiration but may only be used to offset 80% of our taxable income.

The majority of our federal NOLs are not subject to expiration but may only be used to offset 80% of our taxable income.

As of December 31, 2025, the Company has foreign NOLs of approximately $143.3 million.

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The California research tax credit carryforward does not expire and can be carried forward indefinitely until utilized.

We also have gross capital loss carryforwards of $96.0 million that begin to expire in 2028.

Our NOLs and credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities.

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Similar rules may apply under state and foreign tax laws.

In connection with our IPO in February 2019, we experienced an ownership change for purposes of Section 382 and 383 of the Code.

We also experienced an ownership change in July 2023.

Consequently, our federal NOLs and tax credits generated through July 2023 will be subject to annual limitations.

Our NOLs are not expected to expire unused as a result of such annual limitations, assuming we otherwise have taxable income or income tax liabilities in future periods;

however, we expect that some or all of the federal credits generated through July 2023 will expire prior to utilization.

If additional ownership changes occur in the future as a result of changes in our stock ownership, many of which are outside our control, the NOL and credit carryforwards could be subject to further annual limitations.

We have conducted an analysis through December 31, 2024, and we experienced ownership changes in February 2019, in connection with our IPO, and in July 2023.

Consequently, utilization of our federal and certain state NOLs, tax credits, and other tax attributes generated through July 2023 are subject to annual limitations.

Our state tax credits and the majority of our federal NOLs are indefinite carryforwards and as such are not expected to expire unused as a result of such annual limitations, assuming we otherwise have taxable income or income tax liabilities in future periods;

however, we expect that some or all of the state NOLs, federal credits and capital losses generated through July 2023 will expire prior to utilization.

We have not performed a Section 382 analysis since December 2024.

If additional ownership changes have or do occur as a result of changes in our stock ownership, many of which are outside our control, the NOL and credit carryforwards could be subject to further annual limitations.

If we earn taxable income, such annual limitations could result in increased future tax liability to us and our future cash flows could be adversely affected.

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In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities.

This risk is especially relevant for us, because biotechnology and pharmaceutical companies have experienced significant stock price volatility in recent years.

This risk is especially relevant for us, because biotechnology and pharmaceutical companies have experienced significant stock price volatility in recent years, including our recent stock price volatility following the announcement of the Phase 3 PROSERA clinical trial topline results.

On April 3, 2020, we, certain of our executive officers and directors, and the underwriters of our IPO were named as defendants in a purported securities class action lawsuit.

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There can be no assurance that our cybersecurity program and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our systems and Confidential Information.

Despite the implementation of security measures as part of our cybersecurity program, our IT systems and those of our current and any future CROs and other contractors, consultants and collaborators are vulnerable to attack and damage from computer viruses and malware (e.g., ransomware), misconfigurations, “bugs” or other vulnerabilities, cybersecurity threats, unauthorized

access, natural disasters, terrorism, war and telecommunication and electrical failures.

Despite the implementation of security measures as part of our cybersecurity program, our IT systems and those of our current and any future CROs and other contractors, consultants and collaborators are vulnerable to attack and damage from various threat actors, including computer viruses and malware (e.g., ransomware), misconfigurations, “bugs” or other vulnerabilities,

cybersecurity threats, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures.

Attacks upon IT systems are increasing in their frequency, levels of persistence, sophistication and intensity, and are being conducted by sophisticated and organized groups and individuals with a wide range of motives and expertise.

As a result of the continued hybrid working environment, we may also face increased cybersecurity risks due to our reliance on internet technology and the number of our employees who are working remotely, which may create additional opportunities for cybercriminals to exploit vulnerabilities.

Additionally, any integration of AI in our or any third party’s operations, products or services is expected to pose new or unknown cybersecurity risks and challenges.

Furthermore, because the techniques used to obtain unauthorized access to, or to sabotage, systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures.

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The global credit and financial markets are currently, and have from time to time experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, rising interest and inflation rates, declines in consumer confidence, declines in economic growth, increases in unemployment rates and uncertainty about economic stability.

The financial markets and the global economy may also be adversely affected by the current or anticipated impact of military conflict, including the ongoing conflict between Russia and Ukraine and Israel and Hamas, terrorism or other geopolitical events.

Sanctions imposed by the United States and other countries in response to such conflicts, including the one in Ukraine, may also adversely impact the financial markets and the global economy, and any economic countermeasures by the affected countries or others could exacerbate market and economic instability.

The financial markets and the global economy may also be adversely affected by the current or anticipated impact of military conflict, terrorism or other geopolitical events, including recent events in the Middle East.

Sanctions imposed by the United States and other countries in response to such conflicts may also adversely impact the financial markets and the global economy, and any economic countermeasures by the affected countries or others could exacerbate market and economic instability.

Additionally, any adverse developments with respect to specific financial institutions or the broader financial services industry may lead to market-wide liquidity shortages, impair the ability of companies to access near-term working capital needs, and create additional market and economic uncertainty.

For example, in 2023 the closures of Silicon Valley Bank, or SVB, and Signature Bank and their placement into receivership with the Federal Deposit Insurance Corporation, or FDIC created bank-specific and broader financial institution liquidity risk and concerns.

There can be no assurance that future credit and financial market instability and a deterioration in

confidence in economic conditions will not occur.

For example, in 2023 the closures of Silicon Valley Bank, or SVB, and Signature Bank and their placement into receivership with the Federal Deposit Insurance Corporation, or

FDIC created bank-specific and broader financial institution liquidity risk and concerns.

There can be no assurance that future credit and financial market instability and a deterioration in confidence in economic conditions will not occur.

Our general business strategy may be adversely affected by any such economic downturn, liquidity shortages, volatile business environment or continued unpredictable and unstable market conditions.

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sanctions that have been or may be imposed as a result of military conflicts in other countries may impact our ability to continue activities at clinical trial sites within regions covered by such sanctions.

For example, as a result of the military conflict between Russia and Ukraine, the United States and its European allies have recently announced the imposition of sanctions on certain industry sectors and parties in Russia and the regions of Donetsk and Luhansk in Ukraine, as well as enhanced export controls on certain products and industries.

For example, as a result of the military conflict between Russia and Ukraine, the United States and its European allies announced the imposition of sanctions on certain industry sectors and parties in Russia and the regions of Donetsk and Luhansk in Ukraine, as well as enhanced export controls on certain products and industries.

These and any additional sanctions and export controls, as well as any economic countermeasures by the governments of Russia or other jurisdictions, could adversely impact our ability to continue activities at clinical trial sites within regions covered by such sanctions or directly or indirectly disrupt our supply chain.

If we fail to comply with export and import regulations and such economic sanctions, penalties could be imposed, including fines and/or denial of certain export privileges.

Changes to United States tariff and import/export regulations may have a negative effect on us.

The United States has enacted, and continues to consider, a range of trade-related measures, including tariffs, export controls, and other policies.

The President of the United States has directed agencies to reassess key aspects of U.S.

trade policy, and there has been ongoing debate and uncertainty surrounding potential changes to trade agreements, tariff structures, and foreign investment regulations.

For example, on February 20, 2026, the United States Supreme Court issued a ruling striking down certain tariffs previously imposed under the International Emergency Economic Powers Act of 1977 (“IEEPA”).

Following the Supreme Court’s decision, President Trump stated that he intends to use other authorities to invoke other laws to collect tariffs and announced new tariffs on imports from all countries.

There remains substantial uncertainty regarding the duration of existing and newly announced tariffs, potential changes or pauses to such tariffs, tariff levels, and whether further additional tariffs or other retaliatory actions may be imposed, modified, or suspended.

Shifts in trade policy, whether through legislation, executive action, or international negotiation, could alter the global trade landscape and affect supply chains, pricing, and demand for goods and services.

These developments, or the perception that such changes may occur, have and could continue to have a material adverse effect on global economic conditions, contribute to volatility in financial markets, and

disrupt international trade, including trade between the U.S.

and its key partners.

Any of these factors could depress economic activity and the development and commercialization of our product candidates, which could result in a material adverse effect on our business, financial condition and results of operations.

We incur significant costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.

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The rules and regulations applicable to public companies have increased and may continue to increase our legal and financial compliance costs and to make some activities more time consuming and costly.

If these requirements divert

the attention of our management and personnel from other business concerns, they could have a material adverse effect on our business, financial condition and results of operations.

If these requirements divert the attention of our management and personnel from other business concerns, they could have a material adverse effect on our business, financial condition and results of operations.

The increased costs will decrease our net income or increase our net loss and may require us to reduce costs in other areas of our business or increase the prices of our products or services.

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Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition, results of operations or cash flows.

If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines we have a material weakness or significant deficiency in our internal control over financial reporting once that firm begin its Section 404 reviews, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.

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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