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Item 1. Business

2023-03-23 compared with 2022-03-24 · 203 added, 147 removed, 621 unchanged (36% of the section changed)

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We are leveraging our proprietary PREDATOR platform to design conditionally activated molecules that stimulate both adaptive and innate immunity with the goal of addressing the limitations of conventional proinflammatory immune therapies.

Our molecules, which we refer to as INDUKINE molecules, are intended to activate selectively in the tumor microenvironment, or TME.

Our most advanced product candidates, WTX-124 and WTX-330, are systemically delivered, conditionally activated Interleukin-2, or IL-2, and Interleukin-12, or IL-12, respectively, INDUKINE molecules for the treatment of solid tumors.

We plan to submit an investigational new drug application, or IND, to the U.S.

Food and Drug Administration, or FDA, for WTX-124 in the second quarter of 2022, an IND for WTX-330 in the third quarter of 2022, and thereafter initiate a Phase 1/1b clinical trial for each candidate in multiple tumor types as a single agent and in combination with an immune checkpoint inhibitor.

Our INDUKINE molecules are intended to remain inactive in peripheral tissue yet activate selectively in the tumor microenvironment, or TME.

Our most advanced clinical stage product candidates, WTX-124 and WTX-330, are systemically delivered, conditionally activated Interleukin-2 (IL-2), and Interleukin-12 (IL-12) INDUKINE molecules, respectively, for the treatment of solid tumors.

We are currently conducting a Phase 1/1b clinical trial to evaluate the safety and tolerability of WTX-124 in patients with advanced or metastatic solid tumors as a single agent and in combination with an immune checkpoint inhibitor, and a Phase 1 clinical trial to evaluate the safety and tolerability of WTX-330 in patients with advanced or metastatic solid tumors or lymphoma resistant to checkpoint inhibitors or for which checkpoint inhibitors are not approved.

We have also recently nominated WTX-712 as our next development candidate.

WTX-712 is a systemically delivered, conditionally activated Interleukin-21 (IL-21) INDUKINE molecule that is being developed to minimize the severe toxicities that have been observed with recombinant IL-21 therapy and maximize clinical benefit when administered as monotherapy or in combination with checkpoint inhibitors in refractory and/or immunologically unresponsive tumors.

We are building our PREDATOR platform to generate a pipeline of innovative therapeutics that cover a diversity of immune stimulating mechanisms with the potential to address significant unmet medical need in cancer.

We are also expanding our platform capabilities to other therapeutic areas including inflammatory diseases.

Our PREDATOR platform consists of our protein engineering technologies and our know-how, which we use to generate INDUKINE molecules with multiple functional domains rationally engineered into a single protein to achieve the desired pharmaceutical profile.

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The inactivation domain physically blocks the cytokine portion of the INDUKINE molecule in non-tumor tissue throughout the body, or the periphery, preventing it from binding to its receptor until it is cleaved and thereby activated in the TME.

We engineer the half-life extension domain to overcome the short half-lives of cytokines in vivo , which typically range from a few minutes to a few hours.

The half-life extension domain enables high systemic and tumor tissue exposure for the INDUKINE molecule prior to its cleavage in the tumor.

After cleavage in the tumor, the half-life extension domain is removed, and the cytokine is released to activate immune cells.

We select the proprietary protease-cleavable linker to enable conditional activation of the cytokine portion of the INDUKINE molecule within tumor tissue.

We select the proprietary protease-cleavable linker to enable conditional release of the cytokine portion of the INDUKINE molecule within tumor tissue.

This selection is based on our extensive screening in preclinical studies to identify protease-cleavable linkers that are efficiently cleaved by a broad array of human tumor tissues with minimal cleavage in non-tumor tissues.

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Our current pipeline is summarized below:

Using our PREDATOR platform, we have developed three initial product candidates:

WTX-124, WTX-330 and WTX-613.

In addition to these product candidates, we are pursuing additional immuno-oncology discovery programs in which we are applying our novel engineering approach to other targets.

Using our PREDATOR platform, we have identified and are continuing to develop four initial product candidates:

WTX-124, WTX-330, JZP898 (formerly WTX-613) and WTX-712.

In addition to these product candidates, we are pursuing additional immune-oncology discovery programs in which we are applying our novel engineering approach to other targets.

We are also expanding our technology to other disease areas, such as inflammatory diseases.

Our goal is to utilize our proprietary PREDATOR platform to redefine the cancer treatment landscape with therapies to transform the lives of cancer patients.

Key elements of our strategy include:

• Advancing our lead product candidate, IL-2 INDUKINE molecule (WTX-124), into and through clinical development in selected solid tumor indications.

• Advancing our IL-12 INDUKINE molecule (WTX-330) into clinical development in selected solid tumors and lymphoma.

• Leveraging our proprietary PREDATOR platform to advance our IFNα INDUKINE molecule (WTX-613) through preclinical development and expand our pipeline of product candidates.

• Advancing our lead product candidate, WTX-124, through clinical development in selected solid tumor indications.

• Advancing WTX-330 through clinical development in selected solid tumors and lymphoma.

• Continuing our collaboration with Jazz Pharmaceuticals Ireland Limited, or Jazz, as Jazz develops and commercializes JZP898 (formerly WTX-613), a differentiated, conditionally activated interferon alpha (IFNα) INDUKINE™ molecule.

• Advancing WTX-712 through preclinical development.

• Establishing a leading position in protein engineering and developing optimized conditionally activated molecules.

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These proteins regulate immune responses by acting as chemical messengers for the body’s immune cells through receptor site binding.

Interleukins, such as IL-2 and IL-12, and IFNα are specific types of cytokines, produced primarily by cells of the immune system to signal and organize the immune response.

Interleukins, such as IL-2 and IL-12, IFNα and IL-21 are specific types of cytokines, produced primarily by cells of the immune system to signal and organize the immune response.

In cancer, cytokines facilitate the ability of the immune system to recognize tumor cells as abnormal and harmful to the host.

Cytokines further increase the proliferation of, enhance the survival of and direct a variety of immune cell types to infiltrate the TME and promote potent anti-tumor immune responses resulting in tumor cell killing and tumor clearance.

Two cytokine therapies have received FDA approval for cancer treatment:

(1) aldesleukin for the treatment of metastatic RCC and metastatic melanoma and (2) interferon-alfa2b for the treatment of several malignancies, including advanced melanoma.

Two cytokine therapies have received U.S.

Food and Drug Administration, or FDA, approval for cancer treatment:

(1) aldesleukin for the treatment of metastatic renal cell carcinoma, or RCC, and metastatic melanoma and (2) interferon-alfa2b for the treatment of several malignancies, including advanced melanoma.

However, despite promising anti-tumor activity, the clinical utility of approved cytokine therapies is limited due to toxicity and poor pharmaceutical properties, such as short half-life, reduced exposure of active drug in the tumor and the requirement for frequent administration.

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The need to improve the pharmaceutical properties of cytokines to achieve increased therapeutic indexes provides an opportunity to address a large unmet need for safer, and potentially more efficacious, cytokine therapeutics for the treatment of cancer.

Our PREDATOR platform allows us to engineer cytokines that can be delivered systemically and have activity selectively upon reaching the TME, thus potentially limiting systemic toxicity.

Our PREDATOR platform allows us to engineer cytokines that can be delivered

systemically and have activity selectively upon reaching the TME, thus potentially limiting systemic toxicity.

We believe this unique profile will help overcome the limitations seen with other cytokine approaches.

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• Half-Life Extension Domain :

A domain that imparts a longer half-life to the INDUKINE molecule until cleavage within the tumor, when the immunostimulatory cytokine is released.

A domain that imparts a longer half-life to the INDUKINE molecule thereby increasing systemic and tumor tissue exposure.

Following cleavage within the tumor, half-life extension domain is removed and the immunostimulatory cytokine is released.

We have selected multiple domain formats to enable our INDUKINE product candidates to maintain high systemic and tumor tissue exposure.

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We then screen the prioritized linker sequences that we have identified from the initial novel proprietary library of peptide sequences for cleavage by a panel of primary human tumor specimens and for stability when incubated with human serum or normal tissues.

This step allows us to eliminate linkers that are not efficiently cleaved by human tumor samples and identify proprietary linkers that are efficiently cleaved by human tumor specimens.

Leveraging this screening process, we initially screened several thousand linker sequences for optimal biochemical properties, and then screened the lead sequences for cleavage by a panel of primary human tumor specimens and normal non-tumor tissues.

Linker sequences that were not efficiently cleaved by human tumor samples (for example, the linker shown as Linker 1 in the diagram below) were eliminated in the screening and those that were efficiently cleaved by human tumors but not cleaved by normal serum or tissues (for example, the linker shown as Linker 3 in the diagram below) were selected for incorporation into our INDUKINE molecules to confirm their activity in vitro and in vivo .

molecules to confirm their activity in vitro and in vivo .

We have selected linkers for our INDUKINE molecules with characteristics similar to those of Linker 3 in the table below.

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• Enhanced Tolerability :

In order to improve tolerability, our INDUKINE molecules are designed to be administered as inactive pro-drugs that employ a tailored, high affinity blockade to minimize off-target toxicity.

To improve tolerability, our INDUKINE molecules are designed to be administered as inactive pro-drugs that employ a tailored, high affinity blockade to minimize off-target toxicity.

We aim to prevent peripheral pathway activation, as well as target-mediated disposition in normal tissues, with the goal of minimizing potential toxicity.

• Optimized Pharmaceutical Properties :

We design INDUKINE molecules to be stable in the bloodstream and periphery and to have a long serum half-life in order to achieve efficacy without requiring the frequent dosing that is a limiting requirement of approved recombinant cytokines, such as aldesleukin, an rhIL-2 therapy.

We design INDUKINE molecules to be stable in the bloodstream and periphery and to have a long serum half-life to achieve efficacy without requiring the frequent dosing that is a limiting requirement of approved recombinant cytokines, such as aldesleukin, a recombinant human IL-2, or rhIL-2, therapy.

Our design allows us to achieve high, biologically relevant tumor tissue exposure with our INDUKINE molecules.

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Our IL-2 INDUKINE Molecule

Our lead product candidate, WTX-124, is a systemically delivered, conditionally activated IL-2 INDUKINE molecule that we are developing to minimize the severe toxicities observed with recombinant human IL-2, or rhIL-2, therapy and maximize clinical benefit when administered as monotherapy or in combination with immune checkpoint inhibitors in advanced or metastatic tumors.

Our lead product candidate, WTX-124, is a systemically delivered, conditionally activated IL-2 INDUKINE molecule that we are developing to minimize the severe toxicities observed with rhIL-2 therapy and maximize clinical benefit when administered as monotherapy or in combination with immune checkpoint inhibitors in advanced or metastatic tumors.

We believe that these properties will also allow WTX-124 to have potential applicability in indications beyond those for which rhIL-2 therapy is currently approved.

Key features of WTX-124 include preservation of full IL-2 potency and function as observed in preclinical trials, high affinity blockade of IL2—IL2R interaction in systemic circulation and non-tumor tissues, half-life extension for optimal tumor exposure and conditional protease activation within the TME due to our proprietary linker.

Key features of WTX-124 include preservation of full IL-2 potency and function as observed in preclinical studies, high affinity blockade of IL2—IL2R interaction in systemic circulation and non-tumor tissues, half-life extension for optimal tumor exposure and conditional protease activation within the TME due to our proprietary linker.

We designed WTX-124 to address the limitations of next generation IL-2 therapies in development by blocking the binding of IL-2 to the IL-2R in the periphery, thereby inhibiting IL-2 signaling and potentially minimizing toxicities, while maintaining binding to the high affinity IL-2Ra/ß/g in tumors to ensure the full pharmacology of IL-2.

WTX-124 consists of wild-type human IL-2, an IL-2Rß/g blockade element that eliminates binding to both high and medium affinity IL-2Rs expressed in normal tissues to neutralize IL-2 activity in the periphery, an antibody fragment that extends the circulation half-life and a proprietary linker for cleavage in the TME.

WTX-124 consists of wild-type human IL-2, an IL-2Rß blockade element that eliminates binding to both high and medium affinity IL-2Rs expressed in normal tissues to neutralize IL-2 activity in the periphery, an antibody fragment that extends the circulation half-life and a proprietary linker for cleavage in the TME.

As a prodrug, WTX-124 is conditionally activated in the TME to release an IL-2 cytokine to stimulate an anti-tumor immune response but with reduced peripheral toxicities.

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Market Opportunity

We are initially developing WTX-124 in tumor types known to be responsive to IL-2 and PD-1 targeting therapies including melanoma, RCC and non-small cell lung cancer.

We are initially developing WTX-124 in tumor types known to be responsive to IL-2 and/or PD-1 targeting therapies including melanoma, RCC and non-small cell lung cancer.

These are aggressive tumor types and many patients will eventually progress following treatment with standard of care.

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If successfully developed and approved, we believe WTX-124 represents a promising therapeutic option for patients with life-threatening diseases with high unmet medical need, either as monotherapy or in combination with immune checkpoint inhibitors or current or potential future standard of care agents.

The global checkpoint inhibitors market is expected to grow from $15.29 billion in 2020 to $18.04 billion in 2021 at a compound annual growth rate (CAGR) of 18%.

The market is expected to reach $39.81 billion in 2025 at a CAGR of 22%.

We have the opportunity to potentially expand upon the patient populations and indications beyond those for which Proleukin is approved.

We intend to develop WTX-124 as monotherapy and in combination with pembrolizumab, and eventually in combination with other standard of care therapeutics across different lines of therapy.

According to the Checkpoint Inhibitors Global Market Report 2023, the global checkpoint inhibitors market is expected to reach $46.27 billion in 2026 at a CAGR of 17.9%.

WTX-124 Preclinical Results

In November 2021, we presented “WTX-124 is a novel IL-2 pro-drug that is conditionally activated in tumors and drives anti-tumor immunity in murine syngeneic cancer models” at the 36th Annual Meeting of the Society for Immunotherapy of Cancer (SITC) summarizing the biochemical, cellular, and in vivo activity of our lead IL-2 INDUKINE molecule, WTX-124.

Preclinical data from the presentation for WTX-124 demonstrated that:

The preclinical data for WTX-124 has been presented in Cancer Immunology Research “Discovery of a Conditionally Activated IL-2 that Promotes Antitumor immunity and Induces Tumor Regression (Nirschl et al., Cancer Immunol Res (2022) 10(5):581-596).

Preclinical data from the manuscript for WTX-124 demonstrated that:

• WTX-124, a pro-drug containing wild-type IL-2, is selectively processed and activated in tumors and is efficacious in murine models, even in the presence of regulatory T cells;

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• Mechanistically, WTX-124 induces intratumoral activation of NK cells and CD8+ T cells and generates long-term memory in treated animals;

• WTX-124 possesses good PK characteristics in mouse and NHP models and is stable in the periphery, with minimal release of free IL-2.

These data will be used to support our planned IND submission for WTX-124.

• WTX-124 possesses good PK characteristics in mouse models and is stable in the periphery, with minimal release of free IL-2.

These data were used to support the investigational new drug, or IND, submission in the second quarter of 2022 and the clinical biomarker plan for the Phase 1/1b first-in-human study.

Clinical Development Plan for WTX-124

We submitted an IND for WTX-124 to the FDA in the second quarter of 2022 and subsequently received FDA clearance.

We have designed our clinical development strategy for WTX-124 with the goal of achieving rapid proof-of-concept in historically immunotherapy-sensitive tumor types, including melanoma and RCC, indications for which aldesleukin is approved.

First, we intend to initiate a Phase 1/1b clinical trial of WTX-124 for the treatment of relapsed or refractory advanced or metastatic solid tumors as monotherapy or in combination with pembrolizumab.

During the dose escalation phase of the trial, we expect to identify safe and pharmacodynamically active doses of WTX-124 for the respective dose escalation arms, following which we will open expansion arms for both monotherapy and in combination with pembrolizumab or other standard of care therapy in advanced or metastatic renal cell cancer and advanced or metastatic cutaneous malignant melanoma.

We have initiated a Phase 1/1b clinical trial of WTX-124 for the treatment of relapsed or refractory advanced or metastatic solid tumors as monotherapy and combination therapy with pembrolizumab.

This Phase 1/1b clinical trial is designed to assess safety, tolerability and preliminary efficacy.

We announced the initiation of patient dosing in September 2022.

During the dose escalation phase of the trial, we expect to identify safe and pharmacodynamically active doses of WTX-124 for the respective dose escalation arms, following which we will open expansion arms for both monotherapy and in combination with pembrolizumab in advanced or metastatic renal cell cancer and advanced or metastatic cutaneous malignant melanoma.

Other expansion arms may be added to enroll additional indications of interest.

We anticipate reporting interim safety, tolerability and preliminary efficacy data from these monotherapy cohorts in the fourth quarter of 2023.

The rationale for our clinical development strategy is as follows:

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We believe, based on the mechanism of action of WTX-124, that it may be able to achieve higher intratumoral exposures of IL-2 than aldesleukin with minimal systemic toxicity, leading to monotherapy anti-tumor immune responses in patients with historically immunotherapy-sensitive tumor types who have progressed on, or subsequent to, immune checkpoint inhibitor therapy.

Our preclinical data with WTX-124 shows that WTX-124 has single agent anti-tumor activity in mouse tumor models and was well-tolerated.

Our preclinical data with WTX-124 show that WTX-124 has single agent anti-tumor activity in mouse tumor models and was well-tolerated.

WTX-124 was also tolerated in NHPs at doses greater than predicted to be required for anti-tumor activity based on modeling the mouse tumor data.

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• IL-2 agonists and immune checkpoint inhibitors may act synergistically to enhance anti-tumor immune response .

Clinical results have shown that aldesleukin induces responses as a single agent in patients who progressed on immune checkpoint inhibitors.

Clinical results have shown that aldesleukin induces responses as a single agent in patients who have progressed on immune checkpoint inhibitors.

Our preclinical data with WTX-124 highlight the potential benefit of WTX-124 when combined with an anti-PD-1 antibody.

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Our IL-12 INDUKINE Molecule

Our second product candidate, WTX-330, is a systemically delivered, conditionally activated IL-12 INDUKINE molecule that we are developing to minimize the severe toxicities observed with rhIL-12 therapy and maximize clinical benefit when administered as monotherapy or in combination with immune checkpoint inhibitors in relapsed or refractory advanced or metastatic solid tumors or lymphoma.

Our second product candidate, WTX-330, is a systemically delivered, conditionally activated IL-12 INDUKINE molecule that we are developing to minimize the severe toxicities observed with rhIL-12 therapy and maximize clinical benefit when administered as monotherapy or in combination with standard of care therapies including checkpoint inhibitors in relapsed or refractory advanced or metastatic solid tumors or lymphoma.

IL-12 is a potent, pleiotropic cytokine for immune-mediated killing of cancer cells, whose mechanism of action includes stimulation of both innate and adaptive immune responses.

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WTX-330 Preclinical Results

In November 2021, we presented “WTX-330, a conditionally activated IL-12 INDUKINE therapy, releases IL-12 selectively in the tumor microenvironment to activate anti-tumor immune responses and induce regression in mouse tumor models” at the 36th Annual Meeting of SITC summarizing the biochemical, cellular, and in vivo activity of our IL-12 INDUKINE molecule, WTX-330.

Based on the preclinical data summarized in the presentation for WTX-330, we concluded that:

• Proof-of-concept assays of WTX-330 demonstrate anti-tumor activity in syngeneic mouse models and better tolerability compared with rIL-12;

The preclinical data for WTX-330 was presented at two annual meetings in 2022.

In April 2022, we presented “WTX-330 is a Conditionally Activated IL-12 Prodrug that Fundamentally Reprograms Tumor Infiltrating CD8+ T cells and Drives Tumor Regression” at the American Association for Cancer Research, or AACR, 2022 Annual Meeting.

In November 2022, we presented “mWTX-330, an IL-21 INDUKINETM Molecule, Selectively Activates Tumor Infiltrating Lymphocytes and Reprograms the Tumor Microenvironment in Murine Syngeneic Tumor Models” at the 37th Annual Meeting of the Society for Immunotherapy of Cancer, or SITC.

Based on the preclinical data summarized in these presentations for WTX-330, we concluded that:

• WTX-330 demonstrates anti-tumor activity in syngeneic mouse models and expands the therapeutic window compared to rIL-12;

• WTX-330 potently inhibits tumor growth in MC38, CT26, B16F10 and EMT6 mouse tumor models;

• Changes in immune profiles in mouse tumors after IL-12 INDUKINE therapy support a mechanism of action similar to rIL-12;

• WTX-330 is tolerated in NHPs and reaches Cmax and area under the curve, or AUC, exposures higher than the efficacious exposures seen in mice.

These data will be used to support our planned IND submission for WTX-330.

• Systemic administration of mWTX-330 results in increased tumor infiltration as well as significantly increased IL-12 and IFNγ signaling by intratumoral CD8+ T cells;

• mWTX-330 treatment metabolically reinvigorates effector cells in the TME, significantly increasing mitochondrial respiration by tumor infiltrating CD8+ T cells as well as NK cells;

• WTX-330, a fully human IL-12 INDUKINE™ molecule, has inducible activity and is preferentially activated in the presence of primary human dissociated tumor samples.

These data were used to support our IND submission in the third quarter of 2022 for WTX-330.

Clinical Development Plan for WTX-330

We plan to submit an IND with the FDA in the third quarter of 2022 to initiate a Phase 1/1b clinical trial of WTX-330 for the treatment of immunotherapy resistant advanced or metastatic solid tumors or lymphoma, followed by expansion arms in relapsed/refractory tumors following treatment with checkpoint inhibitors or tumors for which checkpoint inhibitors are not approved.

In this Phase 1/1b trial, we plan to evaluate safety and tolerability, pharmacokinetics, biomarker changes and preliminary signs of anti-tumor activity.

We submitted an IND for WTX-330 to the FDA in the third quarter of 2022 and subsequently received FDA clearance.

We have initiated a Phase 1 clinical trial of WTX-330 for the treatment of immunotherapy resistant advanced or metastatic solid tumors or lymphoma, to be followed by expansion arms in relapsed/refractory tumors following treatment with checkpoint inhibitors or tumors for which checkpoint inhibitors are not approved.

We announced the initiation of patient dosing in February 2023.

The trial is currently open for enrollment.

In this Phase 1 trial, we plan to evaluate safety and tolerability, pharmacokinetics, biomarker changes and preliminary signs of anti-tumor activity.

We believe the administration of WTX-330 to patients with relapsed or refractory advanced or metastatic solid tumors or lymphoma, in particular those who are resistant to checkpoint inhibitors or for whom checkpoint inhibitors are not indicated, could demonstrate clinical benefit as monotherapy, with the potential for us to pursue an expedited clinical development and regulatory strategy if we are able to show positive single arm efficacy data in a relapsed or refractory tumor type with high unmet medical need.

Our IFNα INDUKINE Molecule

WTX-613 is a systemically delivered, conditionally activated IFNα INDUKINE molecule that we are developing to minimize the severe toxicities that have been observed with rhIFNα therapy and maximize clinical benefit when administered as monotherapy or in combination with checkpoint inhibitors or other standard of care therapy.

JZP898 (formerly WTX-613):

IFNα INDUKINE Molecule Licensed Globally to Jazz Pharmaceuticals

JZP898 (formerly WTX-613) is a systemically delivered, conditionally activated IFNα INDUKINE molecule that we are collaborating with Jazz to develop to minimize the severe toxicities that have been observed with rhIFNα therapy and maximize clinical benefit when administered as monotherapy or in combination with checkpoint inhibitors or other standard of care therapy.

IFNα is a member of the type-I IFN family and a proinflammatory cytokine that exerts dual mechanisms of inhibiting tumor cell growth through both cytotoxic effects directly on tumor cells as well as driving anti-tumor immune responses.

IFNα binds and signals through a heterodimeric receptor formed by the subunits IFNAR1 and IFNAR2, resulting in the phosphorylation and activation of the JAK/STATs pathway, as well as activation of the PI3K, NFkB and MAPK pathways.

While IFNα can inhibit proliferation and induce direct cell apoptosis of some cancer cell types, this mechanism by itself is unlikely to be sufficient to fully control tumor growth.

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Encouraging clinical benefit, although limited, resulted in regulatory approvals for the treatment of several hematological malignancies and solid tumors, such as chronic myelogenous leukemia, lymphoma and malignant melanoma.

Widespread use of IFNα for hematologic and oncologic indications has unfortunately been hampered by adverse events linked to the on-target, off-tumor activity of the native or pegylated formulations of the molecule and its use in clinical practice has been supplanted by other therapies.

Widespread use of IFNα for hematologic and oncologic indications has unfortunately been hampered by adverse events linked to the on-target, off-tumor activity and its use in clinical practice has been supplanted by other therapies.

In our preclinical studies, we observed the potential benefit of IFNα treatment in syngeneic mouse tumor models using colon, melanoma and breast tumor cell lines and the superior response obtained by the INDUKINE molecule format when compared to the dosing of recombinant cytokine.

We designed WTX-613 to improve the pharmacological properties of IFNα to support less frequent systemic administration and potentially enhance its therapeutic index compared to current IFNα based therapies.

WTX-613 is designed to have minimal activity in the periphery and is activated preferentially in the TME to release wild-type IFNα in the tumor and potentially stimulate an anti-tumor immune response while reducing the peripheral toxicities associated with systemic administration of approved rIFNα therapy.

Key features of WTX-613 include high efficiency blockade of IFNα – IFNR interaction in systemic circulation and non-tumor tissues, half-life extension for optimal tumor exposure and proprietary conditional protease activation.

In preclinical studies, an IFNα INDUKINE surrogate molecule has exhibited robust anti-tumor activity mediated through stimulation of a type I interferon immune response with favorable pharmacokinetics and tolerability.

WTX-613 Preclinical Results

We have conducted multiple preclinical studies to assess the pharmacological activity of WTX-613.

The cytokine domain of WTX-613 consists of human IFNα2b, which does not bind to the mouse IFNR.

As a result, laboratory mice cannot be used to study the pharmacology of WTX-613.

Accordingly, we have utilized a surrogate IFNα INDUKINE molecule consisting of mouse IFNα which is otherwise identical to WTX-613, to assess its pharmacological properties.

To assess anti-tumor activity, we treated MC38 mice twice each week with vehicle or the IFNα INDUKINE molecule at a dose of 830 µg.

A total of six doses were administered.

In addition, an 80 µg dose of recombinant mouse IFNα1, or mIFNα1, was administered to a third group of mice twice per day, for five days on, two days’ rest, five days on, for a total of 20 doses.

This 80 µg dose of mIFNα1 was equimolar to the dose of the IFNα INDUKINE molecule.

As shown in the figure below, animals treated with the IFNα INDUKINE molecule displayed long-lasting tumor growth control resulting in durable tumor stasis.

Overall anti-tumor activity of mIFNα1 was modest, even though the treatment initially provided some tumor growth control.

Both treatments were well tolerated at these dose levels with no signs of body weight loss or premature death.

These data suggest that the IFNα INDUKINE molecule could be dosed less frequently and with lower molar amount than mIFNα1 while still maintaining greater anti-tumor activity and acceptable tolerability.

Anti-tumor Activity in MC38 Model

To better understand the mechanism by which the IFNα INDUKINE molecule treatment induced tumor regression, MC38 tumors from animals treated with either vehicle or the IFNα INDUKINE molecule were harvested 24 hours after their second dose in the first week, and tumor infiltrating lymphocytes were collected and analyzed by flow cytometry.

As shown in the figure below, within five days after the initial dose, treatment with the IFNα INDUKINE molecule resulted in a large influx and activation of immune cells, specifically CD8+ T effector cells and tumor specific tetramer+ CD8+ T effector cells which resulted in a significant increase in the CD8+/Treg ratio.

Furthermore, granulocytes were strongly activated following treatment with the IFNα INDUKINE molecule, providing evidence of induction of a pro-inflammatory phenotype in the tumors.

To determine changes in gene expression following treatment with the INDUKINE molecule, we subjected the same tumor material to Nanostring analysis using mRNA extracted from MC38 tumors isolated from animals treated with either vehicle or the IFNα INDUKINE molecule.

A comparison of the gene expression changes in tumors isolated from mice treated with the INDUKINE molecule or vehicle control is shown in the heat-map in the figure below.

We observed that genes in the IFN pathway were strongly upregulated, while genes representing cancer progression were downregulated.

Together, these data demonstrate that treatment with an IFNα INDUKINE molecule increased immune cell tumor infiltration and activation, thereby driving anti-tumor immunity in this model.

In addition to these studies completed to date, we plan to conduct additional in vivo and in vitro pharmacology and toxicology studies to support our planned submission to the FDA of an IND for WTX-613.

Clinical Development Plan for WTX-613

We plan to submit an IND to the FDA in the first half of 2023 for a clinical trial of WTX-613, which we anticipate will evaluate safety and tolerability, pharmacokinetics, biomarker changes and preliminary signs of anti-tumor activity.

Jazz Pharmaceuticals Global License

In April 2022, we entered into a licensing agreement with Jazz under which Jazz acquired exclusive global development and commercialization rights to JZP898 (formerly WTX-613), our differentiated, conditionally activated interferon alpha (IFNα) INDUKINE molecule, which has subsequently been designated JZP898 (formerly WTX-613), as well as products containing certain isolated recombinant polypeptides comprising IFNα that meet specified criteria.

Pursuant to the terms of the licensing agreement, we are responsible for certain pre-clinical development activities with respect to JZP898 (formerly WTX-613) and other development activities specified in mutually agreed upon development plans.

Jazz will generally reimburse us for the cost of such activities.

JZP898 (formerly WTX-613) is currently in preclinical development, and Jazz is responsible for global clinical development and commercialization.

Jazz expects to submit an IND for JZP898 (formerly WTX-613) to the FDA in 2023.

Our IL-21 INDUKINE Molecule

WTX-712 is a systemically delivered, conditionally activated Interleukin-21 (IL-21) INDUKINE molecule.

IL-21 is a pluripotent cytokine that activates anti-tumor T cell responses, induces B cell activation, and promotes generation and maintenance of germinal centers and tertiary lymphoid structures.

A member of the common g-chain family of cytokines, IL-21 acts on a broader range of cells than IL-2 and does not induce vascular leak syndrome.

Despite being a potent inducer of immune activation, IL-21 development has been hampered by poor PK properties and adverse events at dose levels associated with antitumor activity.

WTX-712 is being developed to minimize the severe toxicities that have been observed with recombinant IL-21 therapy and maximize clinical benefit.

Our Early Stage Programs

In addition to IL-2, IL-12 and IFNα, we are also applying our novel engineering approach to other targets.

We believe that additional pro-inflammatory cytokines have the potential to empower the immune system in its fight against cancer.

The most efficacious immune responses to tumors require a coordinated activation of both the innate and adaptive immune responses.

Cytokines are diverse in the nature and extent of their effect, with some having a more direct impact on the innate immune system and others favoring or aiding the activation of the adaptive immune system.

Our goal is to better understand how the localized tumor delivery of these cytokines using our INDUKINE molecules might contribute to control tumor progression while reducing the toxicity that in many cases accompany the systemic delivery of these cytokines.

In addition to IL-2, IL-12, IFNα and IL-21, we are also applying our novel engineering approach to other targets and modalities.

We believe that additional pro-inflammatory cytokines have the potential to empower the immune system in its fight against cancer and inflammatory diseases.

Our goal is to better understand how the localized tumor delivery of these cytokines using our INDUKINE molecules might contribute to disease control while reducing the toxicity that in many cases accompany the systemic delivery of these cytokines.

The pharmaceutical industry is characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary drugs.

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Proleukin (aldesleukin) has been approved and is marketed for the treatment of both metastatic RCC and metastatic melanoma.

In addition, we are aware of numerous clinical and preclinical IL-2 programs using different platforms being developed for oncology indications, including programs from Alkermes Plc, BioNTech SE, Medicenna Therapeutics Corp., Nektar Therapeutics (Bristol-Myers Squibb Company), Neoleukin Therapeutics, Inc., F.

Hoffmann-La Roche AG, or Roche, Synthorx, Inc.

(Sanofi) and Xilio Therapeutics, Inc.

In addition, we are aware of numerous clinical and preclinical IL-2 molecules using different platforms being developed for oncology indications, including programs from Alkermes Plc, BioNTech SE, Medicenna Therapeutics Corp., Synthekine Inc, Asher Biotherapeutics, Inc., F.

Hoffman La-Roche AG, Genentech Inc.

and Xilio Therapeutics, Inc.

There are no approved IL-12 therapies currently on the market for the treatment of cancer.

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(Bristol-Myers Squibb Company), Oncorus, Inc., Turnstone Biologics Corp.

(partnered with Takeda Pharmaceutical Corporation, or Takeda) and Oncosec Medical Incorporated.

If approved, WTX-613 may face competition from other IFNα cancer therapies.

Intron-A, a recombinant IFNα-2b molecule marketed by Merck, has been approved by the FDA for the treatment of several forms of cancer, including specific types of leukemia and lymphoma, and we are aware of other IFNα programs targeting the treatment of cancer in development by Immunomedics (acquired by Gilead Sciences, Inc.), International Center for Genetic Engineering and Biotechnology (ICGEB) and Takeda.

Roferon A, a recombinant IFNα-2a molecule developed and marketed by Roche for the treatment of specific types of leukemia, was discontinued globally in 2020.

We are developing WTX-124, WTX-330 and WTX-613 as potential monotherapies in relapsed or refractory tumor types or in combination with checkpoint inhibitors or other standard of care therapies in advanced or metastatic malignancies with high unmet medical need.

(partnered with Takeda Pharmaceutical Corporation, or Takeda), Oncosec Medical Incorporated, Xilio Therapeutics, Inc.

and Sonnet BioTherapeutics, Inc.

We are developing WTX-124 and WTX-330 as potential monotherapies in relapsed or refractory tumor types or in combination with checkpoint inhibitors or other standard of care therapies in advanced or metastatic malignancies with high unmet medical need.

Standard of care therapies include chemotherapy, targeted therapy, and more recently, immunotherapies, including monoclonal antibodies and bispecific formats, antibody drug conjugates, adoptive cellular therapies, and cytokines.

In addition, there are numerous investigational agents in clinical development.

Combining agents to improve patient outcomes and prevent emergence of resistance has become the norm for treatment of cancer.

Combining agents to improve patient outcomes and prevent emergence of resistance has become the paradigm for treatment of cancer.

Many of our competitors, either alone or with their collaboration partners, have significantly greater financial resources and expertise in research and development, preclinical testing, clinical trials, manufacturing and marketing than we do.

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We also rely on trade secrets and proprietary know-how to protect aspects of our business that are not amenable to, or that we do not consider appropriate for, patent protection.

Our patent portfolio includes patents and patent applications with composition of matter and method of use claims with respect to our product candidates, WTX-124, WTX-330 and WTX-613, and claims directed to our PREDATOR platform technology.

Our patent portfolio includes patents and patent applications with composition of matter and method of use claims with respect to our product candidates, WTX-124, WTX-330, JZP898 (formerly WTX-613) and WTX-712, and claims directed to our PREDATOR platform technology.

For our product candidates, we will, in general, initially pursue patent protection covering compositions of matter and methods of use.

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The patent positions of therapeutic polypeptide companies like ours are generally uncertain and involve complex legal, scientific and factual questions.

In addition, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted or further altered even after patent issuance.

In addition, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its

scope can be reinterpreted or further altered even after patent issuance.

Consequently, we may not obtain or maintain adequate patent protection for any of our future product candidates or for our platform technology.

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Moreover, we cannot provide any assurance that any patents will be issued from our pending or any future applications or that any current or future issued patents will adequately protect our products.

Our patent portfolio, including patents and patent applications that we own and that we license from Harpoon Therapeutics, Inc., or Harpoon, comprises eight patent families that are in various stages of the patent application filing and examination process in various jurisdictions worldwide, and include claims to our product candidates and claims directed to our PREDATOR platform technology for potential products and developments.

Our patent portfolio, including patents and patent applications that we own and comprises about sixteen patent families that are in various stages of the patent application filing and examination process in various jurisdictions worldwide, and include claims to our product candidates and claims directed to our PREDATOR platform technology for potential products and developments.

The status of our patent portfolio changes frequently in the ordinary course of patent prosecution.

As of March 9, 2022, our patent portfolio related to the PREDATOR platform technology included approximately two issued patents in the United States, approximately 17 pending U.S.

provisional or non-provisional patent applications, two pending international patent applications filed under the PCT and approximately 53 pending foreign patent applications, including pending applications in Australia, Brazil, Canada, China, European Patent Office, Hong Kong, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore, and South Africa.

As of March 9, 2023, our patent portfolio included approximately five issued patents in the United States, approximately 16 pending U.S.

provisional or non-provisional patent applications, five pending international patent applications filed under the PCT and approximately 85 pending foreign patent applications, including pending applications in Australia, Brazil, Canada, China, European Patent Office, Hong Kong, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore, South Africa and Taiwan.

These patent applications, if issued, are expected to expire on various dates from 2039 through about 2043, in each case without taking into account any possible patent term extension that may be available.

Our patent portfolio on our PREDATOR platform technology includes two patent families directed to protease cleavable linkers and libraries of protease cleavable linkers, as well as polypeptides that contain such linkers and methods of making libraries and screening libraries to identify linkers with desired properties.

One of the patent families includes pending applications in Australia, Brazil, Canada, China, European Patent Office, Israel, India, Japan, Republic of Korea, Mexico, and Singapore.

One of the patent families includes pending applications in the United States, Australia, Brazil, Canada, China, European Patent Office, Israel, India, Japan, Republic of Korea, Mexico and Singapore.

The 20-year term for patents in this family runs through 2040, excluding any extension of patent term that may be available.

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We plan to file an international patent application under the PCT based on this provisional application before applicable deadlines.

Our patent portfolio also includes patent and patent applications that we license from Harpoon Therapeutics, Inc., or Harpoon.

Our patent portfolio for each of the product candidates is summarized below.

We own two patent families directed to IL-2 INDUKINE molecules and our WTX-124 product candidate.

One of the families includes an issued U.S.

patent with certain composition of matter claims with respect to WTX-124.

We own five patent families directed to IL-2 INDUKINE molecules and our WTX-124 product candidate.

One of the families includes 3 issued U.S.

patents with certain composition of matter claims with respect to IL-2 INDUKINE molecules and WTX-124.

We have also filed pending U.S.

applications and pending foreign patent applications in Australia, Brazil, Canada, China, European Patent Office, Hong Kong, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore and South Africa that claim certain compositions of matter and methods of use with respect to WTX-124.

The 20-year term for patents in this family runs through 2039, excluding any extension of patent term that may be available.

A second patent family currently includes one pending international patent application filed under the PCT that claims certain compositions of matter and methods of use with respect to WTX-124.

This PCT application also claims certain compositions of matter and method of use with respect to WTX-613.

We intend to file national phase applications in the United States and various foreign jurisdictions based on this PCT application before applicable deadlines.

A second patent family currently includes pending applications in U.S., Australia, Brazil, Canada, China, European Patent Office, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore and South Africa with claims direct to certain compositions of matter and methods of use with respect to IL-2 INDUKINE molecules and WTX-124.

These applications also claim certain compositions of matter and method of use with respect to INF-a INDUKINE molecules and WTX-613.

The 20-year term for patents in this family runs through to 2040, excluding any extension of patent term that may be available.

We own two families directed to IL-12 INDUKINE molecules and our WTX-330 product candidate.

One of the families includes an issued U.S.

A third patent family that we co-own currently includes a pending PCT application that claims certain pharmaceutical compositions and methods of use of IL-2 INDUKINE molecules and our WTX-124 product candidate.

We intend to file national applications in the United States and other jurisdictions before applicable deadlines.

The 20-year term for patents in this family will run through to 2042, excluding any extension of patent term that may be available.

A fourth patent family currently includes a pending PCT application that claims certain methods of use of IL-2 INDUKINE molecules and our WTX-124 product candidate.

We intend to file national applications in the United States and other jurisdictions before applicable deadlines.

The 20-year term for patents in this family will run through to 2042, excluding any extension of patent term that may be available.

Our fifth patent family also includes a pending PCT application and a pending application in Taiwan that claim certain methods of use with respect our IL-2 INDUKINE molecules and our WTX-124 product candidate.

This family also claims certain methods of use with respect to IL-12 INDUKINE molecules and our WTX-330 product candidate, and INF-a INDUKINE molecules and WTX-613.

We intend to file national applications in the United States and other jurisdictions based on the PCT application before applicable deadlines.

The 20-year term for patents in this family will run through to 2042, excluding any extension of patent term that may be available.

We own four families directed to IL-12 INDUKINE molecules and our WTX-330 product candidate.

One of the families includes two issued U.S.

patent with certain composition of matter claims with respect to IL-12 INDUKINE molecules.

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The 20-year term for patents in this family runs through 2039, excluding any extension of patent term that may be available.

A second patent family currently consists of a pending international patent application filed under the PCT directed to certain compositions of matter and methods of use with respect to WTX-330.

The 20-year term for patents in this family runs through to 2041, excluding any extension of patent term that may be available.

We own two patent families directed to our INF-a INDUKINE molecules and our WTX-613 product candidate.

We own a first patent family that includes pending foreign applications in Australia, Brazil, Canada, China, European Patent Office, Hong Kong, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore and South Africa that claim certain compositions of matter and methods of use with respect to WTX-613.

A second patent family currently includes pending patent applications in the U.S., Australia, Brazil, Canada, China, European Patent Office, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore and South Africa with claims directed to certain compositions of matter and methods of use with respect to WTX-330.

The 20-year term for patents in

this family runs through to 2041, excluding any extension of patent term that may be available.

Our third patent family currently includes two pending U.S.

provisional applications that claim certain methods of use with respect to IL-12 INDUKINE molecules and our WTX-330 product candidate.

We intend to file PCT and national applications in the United States and other jurisdictions before applicable deadlines.

Our fourth patent family currently includes a pending PCT application and a pending application in Taiwan that claim certain methods of use of IL-12 INDUKINE molecules and our WTX-330 product candidate.

This family also claims certain methods of use with respect to INF-a INDUKINE molecules and WTX-613, and IL-2 INDUKINE molecules and our WTX-124 product candidate.

We intend to file national applications in the United States and other jurisdictions based on the PCT application before applicable deadlines.

The 20-year term for patents in this family will run through to 2042, excluding any extension of patent term that may be available.

We own four patent families directed to our INF-a INDUKINE molecules and our WTX-613 product candidate.

We own a first patent family that includes pending foreign applications in United States, Australia, Brazil, Canada, China, European Patent Office, Hong Kong, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore and South Africa that claim certain compositions of matter and methods of use with respect to INF-a INDUKINE molecules and WTX-613.

The 20-year term for patents in this family runs through 2039, excluding any extension of patent term that may be available.

A second patent family currently includes one pending international patent application filed under the PCT that claims certain compositions of matter and methods of use with respect to WTX-613.

This PCT application also claims certain compositions of matter and method of use with respect to WTX-124.

We intend to file national phase applications in various foreign jurisdictions based on this PCT application before applicable deadlines.

A second patent family currently includes pending patent applications in U.S., Australia, Brazil, Canada, China, European Patent Office, India, Israel, Japan, Republic of Korea, Mexico, Russian Federation, Singapore and South Africa with claims directed to certain compositions of matter and methods of use with respect to WTX-613.

These applications also claim certain compositions of matter and method of use with respect to IL-2 INDUKINE molecules and our WTX-124 product candidate.

The 20-year term for patents in this family runs through 2040, excluding any extension of patent term that may be available.

We filed a pending application in the United States that combined the disclosures of the first and second families and claims compositions of matter and certain methods of use with respect to WTX-613.

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application will run through to 2039 or 2040, depending on the particular claims, excluding any extension of patent term that may be available.

Our third patent family includes a pending PCT application and a pending application in Taiwan that claim certain compositions of matter and methods of use with respect our INF-a INDUKINE molecules.

We intend to file national applications in the United States and other jurisdictions based on the pending PCT application before applicable deadlines.

The 20-year term for patents in this family will run through to 2042, excluding any extension of patent term that may be available.

Our fourth patent family also includes a pending PCT application and a pending application in Taiwan that claim certain methods of use with respect to INF-a INDUKINE molecules and WTX-613.

This family also claims certain methods of use of with respect to IL-12 INDUKINE molecules and our WTX-330 product candidate, and IL-2 INDUKINE molecules and our WTX-124 product candidate.

We intend to file national applications in the United States and other jurisdictions based on the PCT application before applicable deadlines.

The 20-year term for patents in this family will run through to 2042, excluding any extension of patent term that may be available.

We own a patent family directed to our IL-21 INDUKINE molecules and our WTX-712 product candidate.

This patent family includes a pending PCT application that claims certain compositions of matter and method of use with respect to WTX-712.

We intend to file national phase applications in the United States and various foreign jurisdictions based on this PCT application before applicable deadlines.

The 20-year term for patents in this family runs through to 2043, excluding any extension of patent term that may be available.

In-Licensed Patents

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The 20-year term for the licensed patents runs through 2037, excluding any extension of patent term that may be available.

See the discussion under “License Agreement with Harpoon Therapeutics, Inc.”, and Item 13.

See the discussion under “License Agreement with Harpoon Therapeutics, Inc.”, below, and Item 13.

Certain Relationships and Related Transactions, and Director Independence, within this Annual Report for more information regarding our license agreement with Harpoon.

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Preclinical studies include laboratory evaluation of the purity and stability of the manufactured substance or active pharmaceutical ingredient and the formulated product, as well as in vitro and animal studies to assess the safety and activity of the product candidate for initial testing in humans and to establish a rationale for therapeutic use.

These studies are generally referred to as IND-enabling studies.

The conduct of preclinical studies is subject to federal regulations and requirements, including GLP standards and regulations and the United States Department of Agriculture’s Animal Welfare Act, if applicable.

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The FDA will typically inspect one or more clinical sites to assure compliance with GCP and the integrity of the clinical data submitted.

In August 2018, the FDA released a draft guidance entitled “Expansion Cohorts:

In March 2022, the FDA released final guidance entitled “Expansion Cohorts:

Use in First-In-Human Clinical Trials to Expedite Development of Oncology Drugs and Biologics,” which outlines how developers can utilize an adaptive trial design commonly referred to as a seamless trial design in early stages of oncology biological product development (i.e., the first-in-human clinical trial) to compress the traditional three phases of trials into one continuous trial called an expansion cohort trial.

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Expansion cohort trials can potentially bring efficiency to biological product development and reduce developmental costs and time.

In December 2022, with the passage of Food and Drug Omnibus Reform Act, or FDORA, Congress required sponsors to develop and submit a diversity action plan for each Phase 3 clinical trial or any other “pivotal study” of a new drug or biological product.

These plans are meant to encourage the enrollment of more diverse patient populations in late-stage clinical trials of FDA-regulated products.

Specifically, action plans must include the sponsor’s goals for enrollment, the underlying rationale for those goals, and an explanation of how the sponsor intends to meet them.

In addition to these requirements, the legislation directs the FDA to issue new guidance on diversity action plans.

Finally, sponsors of clinical trials are required to register and disclose certain clinical trial information on a public registry (clinicaltrials.gov) maintained by the U.S.

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In particular, information related to the product, patient population, phase of investigation, study sites and investigators and other aspects of the clinical trial is made public as part of the registration of the clinical trial.

Both the NIH and the FDA have recently signaled the government’s willingness to begin enforcing those requirements against non-compliant clinical trial sponsors.

The failure to submit clinical trial information to clinicaltrials.gov, as required, is a prohibited act under the FDCA with violations subject to potential civil monetary penalties of up to $10,000 for each day the violation continues.

Although the FDA has historically not enforced these reporting requirements due to the long delay by the Department of Health and Human Services, or HHS, in issuing final implementing regulations, those regulations have now been issued and the FDA has issued several Notices of Noncompliance to manufacturers since April 2021.

Concurrent with clinical trials, companies often complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the candidate product as well as finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements.

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A deferral may be granted for several reasons, including a finding that the product or therapeutic candidate is ready for approval for use in adults before pediatric trials are complete or that additional safety or effectiveness data needs to be collected before the pediatric trials begin.

The law requires the FDA to send a PREA Non-Compliance letter to sponsors who have failed to submit their pediatric assessments required under PREA, have failed to seek or obtain a deferral or deferral extension or have failed to request approval for a required pediatric formulation.

The FDA is required to send a PREA Non-Compliance letter to sponsors who have failed to submit their pediatric assessments required under PREA, have failed to seek or obtain a deferral or deferral extension or have failed to request approval for a required pediatric formulation.

Unless otherwise required by regulation, the pediatric data requirements do not apply to products with orphan designation, although the FDA has recently taken steps to limit what it considers abuse of this statutory exemption.

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The application includes all relevant data available from pertinent preclinical and clinical trials, including negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s chemistry, manufacturing, controls and proposed labeling, among other things.

Data can come from company-sponsored clinical trials intended to test the safety and effectiveness of a use of a product, or from a number of alternative sources, including studies initiated by investigators.

Data can come from company-sponsored clinical trials

intended to test the safety and effectiveness of a use of a product, or from a number of alternative sources, including studies initiated by investigators.

The application is the vehicle through which sponsors formally propose that the FDA approve a new product for marketing and sale in the United States for one or more indications.

Every new product candidate must be the subject of an approved NDA or BLA before it may be commercialized in the United States.

Under federal law, the submission of most applications is subject to an application user fee.

The sponsor of an approved application is also subject to an annual program fee.

Under federal law, the fee required for the submission and review of an application under the Prescription Drug User Fee Act, or the PDUFA, is substantial (for example, for fiscal year 2023 this application fee is approximately $3.25 million), and the sponsor of an approved application is also subject to an annual program fee, currently more than $394,000 per eligible prescription product.

Certain exceptions and waivers are available for some of these fees, such as an exception from the application fee for products with orphan designation and a waiver for certain small businesses.

If an application is

withdrawn prior to the FDA acceptance for filing, 75% of these fees may be refunded to the sponsor.

If an application is withdrawn prior to the FDA acceptance for filing, 75% of these fees may be refunded to the sponsor.

If an application is withdrawn after filing, a lower portion of these fees may be refunded in certain circumstances.

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Additionally, before approving an NDA or BLA, the FDA will typically inspect one or more clinical sites to assure compliance with GCP standards and the integrity of the clinical data supporting the application.

With passage of FDORA, Congress clarified the FDA’s authority to conduct inspections by expressly permitting inspection of facilities involved in the preparation, conduct, or analysis of clinical and non-clinical studies submitted to the FDA as well as other persons holding study records or involved in the study process.

The FDA may also refer an application for a novel product to an advisory committee or explain why such referral was not made.

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If a CRL is issued, the applicant will have one year to respond to the deficiencies identified by the FDA, at which time the FDA can deem the application withdrawn or, in its discretion, grant the applicant an additional six month extension to respond.

For those seeking to challenge the FDA’s CRL decision, the FDA has indicated that sponsors may request a formal hearing on the CRL or they may file a request for reconsideration or a request for a formal dispute resolution.

An approval letter, on the other hand, authorizes commercial marketing of the product with specific prescribing information for specific indications.

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The sponsor must also provide, and the FDA must approve, a schedule for the submission of the remaining information and the sponsor must pay applicable user fees.

However, the FDA’s time period goal for reviewing a Fast Track application does not begin until the last section of the

application is submitted.

However, the FDA’s time period goal for reviewing a Fast Track application does not begin until the last section of the application is submitted.

In addition, the Fast Track designation may be withdrawn by the FDA if the FDA believes that the designation is no longer supported by data emerging in the clinical trial process.

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All promotional materials for product candidates approved under accelerated regulations are subject to prior review by the FDA.

With passage of FDORA in December 2022, Congress modified certain provisions governing accelerated approval of drug and biologic products.

Specifically, the new legislation authorized the FDA to require a sponsor to have its confirmatory clinical trial underway before accelerated approval is awarded, require a sponsor of a product granted accelerated approval to submit progress reports on its post-approval

studies to the FDA every six months until the study is completed, and use expedited procedures to withdraw accelerated approval of an NDA or BLA after the confirmatory trial fails to verify the product’s clinical benefit.

Further, FDORA requires the FDA to publish on its website “the rationale for why a post-approval study is not appropriate or necessary” whenever it decides not to require such a study upon granting accelerated approval.

Post-Approval Regulation

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Once an approval is granted, the FDA may withdraw the approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market.

Later discovery of previously unknown problems with a product, including adverse

events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information;

Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information;

imposition of post-market studies or clinical trials to assess new safety risks;

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The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability.

In September 2021, the FDA published final regulations which describe the types of evidence that it will consider in determining the intended use of a drug or biologic.

It may be permissible, under very specific, narrow conditions, for a manufacturer to engage in nonpromotional, non-misleading communication regarding off-label information, such as distributing scientific or medical journal information.

Moreover, with passage of the Pre-Approval Information Exchange Act, or PIE Act, in December 2022, sponsors of products that have not been approved may proactively communicate to payors certain information about products in development to help expedite patient access upon product approval.

Previously, such communications were permitted under FDA guidance, but the new legislation explicitly provides protection to sponsors who convey certain information about products in development to payors, including unapproved uses of approved products.

If a company is found to have promoted off-label uses, it may become subject to adverse public relations and administrative and judicial enforcement by the FDA, the Department of Justice, or the Office of the Inspector General of the Department of Health and Human Services, as well as state authorities.

This could subject a company to a range of penalties that could have a significant commercial impact, including civil and criminal fines and agreements that materially restrict the manner in which a company promotes or distributes drug products.

In September 2021, the FDA published final regulations which describe the types of evidence that the agency will consider in determining the intended use of a drug or biologic.

Generic Drugs

In 1984, with passage of the Hatch-Waxman Amendments to the FDCA, Congress established an abbreviated regulatory scheme authorizing the FDA to approve generic drugs that are shown to contain the same active ingredients as, and to be bioequivalent to, drugs previously approved by the FDA pursuant to NDAs.

To obtain approval of a generic drug, a sponsor must submit an abbreviated new drug application, or ANDA, to the agency.

To obtain approval of a generic drug, a sponsor must submit an abbreviated new drug application, or ANDA, to the FDA.

An ANDA is a comprehensive submission that contains, among other things, data and information pertaining to the active pharmaceutical ingredient, bioequivalence, drug product formulation, specifications and stability of the generic drug, as well as analytical methods, manufacturing process validation data and quality control procedures.

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An active moiety is the molecule or ion responsible for the physiological or pharmacological action of the drug substance.

In cases where such NCE exclusivity has been granted, an ANDA may not be filed with the FDA until the expiration of five years unless the submission is accompanied by a Paragraph IV certification, in which case the sponsor may submit its application four years following the original product approval.

cases where such NCE exclusivity has been granted, an ANDA may not be filed with the FDA until the expiration of five years unless the submission is accompanied by a Paragraph IV certification, in which case the sponsor may submit its application four years following the original product approval.

The FDCA also provides for a period of three years of exclusivity if the NDA includes reports of one or more new clinical investigations, other than bioavailability or bioequivalence studies, that were conducted by or for the sponsor and are essential to the approval of the application.

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The BPCIA established a regulatory scheme authorizing the FDA to approve biosimilars and interchangeable biosimilars.

To date, the FDA has approved a number of biosimilars and the first interchangeable biosimilar product was approved on July 30, 2021 and a second product previously approved as a biosimilar was designated as interchangeable in October 2021.

To date, the FDA has approved a number of biosimilars and several interchangeable biosimilar products.

Under the BPCIA, a manufacturer may submit an application for licensure of a biologic product that is “biosimilar to” or “interchangeable with” a previously approved biological product or “reference product.” In order for the FDA to approve a biosimilar product, it must find that there are no clinically meaningful differences between the reference product and proposed biosimilar product in terms of safety, purity, and potency.

For the FDA to approve a biosimilar product as interchangeable with a reference product, the agency must find that the biosimilar product can be expected to produce the same clinical results as the reference product, and (for products administered multiple times) that the biologic and the reference biologic may be switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic.

For the FDA to approve a biosimilar product as interchangeable with a reference product, the FDA must find that the biosimilar product can be expected to produce the same clinical results as the reference product, and (for products administered multiple times) that the biologic and the reference biologic may be switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic.

In December 2022, Congress clarified through FDORA that the FDA may approve multiple first interchangeable biosimilar biological products so long as the products are all approved on the first day on which such a product is approved as interchangeable with the reference product.

Under the BPCIA, an application for a biosimilar product may not be submitted to the FDA until four years following the date of approval of the reference product.

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If the request is granted, the FDA will disclose the identity of the therapeutic agent and its potential use.

Orphan drug designation does not shorten the Prescription Drug User Fee Act, or PDUFA, goal dates for the regulatory review and approval process, although it does convey certain advantages such as tax benefits and exemption from the PDUFA application fee.

Orphan drug designation does not shorten the PDUFA goal dates for the regulatory review and approval process, although it does convey certain advantages such as tax benefits and exemption from the PDUFA application fee.

If a product with orphan designation receives the first FDA approval for the disease or condition for which it has such designation or for a select indication or use within the rare disease or condition for which it was designated, the product generally will receive orphan drug exclusivity.

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

In September 2021, the Court of Appeals for the 11th Circuit held that, for the purpose of determining the scope of market exclusivity, the term “same disease or condition” in the statute means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” Thus, the court concluded, orphan drug exclusivity applies to the entire designated disease or condition rather than the “indication or use.” It is unclear how this court decision will be implemented by the FDA.

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

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

Pediatric Exclusivity

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For biologic products, the six-month period may only be attached to any existing regulatory exclusivities but not to any patent terms.

This six-month exclusivity may be granted if an NDA or BLA sponsor submits pediatric data that fairly respond to a written request from the FDA for such data.

This six-month exclusivity may be granted if an NDA or BLA sponsor submits pediatric data that fairly respond to a

written request from the FDA for such data.

The data do not need to show the product to be effective in the pediatric population studied;

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Nonetheless, product candidates may not be considered medically necessary or cost effective.

A decision by a third-party payor not to cover a product candidate could reduce physician utilization once the

product is approved and have a material adverse effect on sales, results of operations and financial condition.

A decision by a third-party payor not to cover a product candidate could reduce physician utilization once the product is approved and have a material adverse effect on sales, results of operations and financial condition.

Additionally, a payor’s decision to provide coverage for a product does not imply that an adequate reimbursement rate will be approved.

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In addition, the Health Insurance Portability and Accountability Act of 1996, or HIPAA, as amended, among other things, imposes limitations on certain covered healthcare providers, health plans, and healthcare clearinghouses and their respective business associates and their covered subcontractors that perform services for them that involve the use, or disclosure of, individually identifiable health information, relating to the privacy, security and transmission of individually identifiable health information.

Further, some state laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring manufacturers to report information related to payments to physicians and other health care providers or marketing expenditures.

related to payments to physicians and other health care providers or marketing expenditures.

Additionally, some state and local laws require the registration of pharmaceutical sales representatives in the jurisdiction.

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In August 2011, the Budget Control Act of 2011, among other things, created measures for spending reductions by Congress including aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, which went into effect in April 2013 and will remain in effect through 2032.

These Medicare sequester reductions have been suspended through the end of March 2022.

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

The American Taxpayer Relief Act of 2012, among other things, reduced Medicare payments

to several providers and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

These Medicare sequester reductions were suspended and reduced through the end of June 2022, with the full 2% cut resuming thereafter.

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

These laws may result in additional reductions in Medicare and other healthcare funding and otherwise affect the prices we may obtain for any of our product candidates for which we may obtain regulatory approval or the frequency with which any such product candidate is prescribed or used.

The Consolidated Appropriations Act, which was signed into law by President Biden in December 2022, made several changes to sequestration of the Medicare program.

Section 1001 of the Consolidated Appropriations Act delays the 4% Statutory Pay-As-You-Go Act of 2010, or PAYGO, sequester for two years, through the end of calendar year 2024.

Triggered by enactment of the American Rescue Plan Act of 2021, the 4% cut to the Medicare program would have taken effect in January 2023.

The Consolidated Appropriations Act’s health care offset title includes Section 4163, which extends the 2% Budget Control Act of 2011 Medicare sequester for six months into fiscal year 2032 and lowers the payment reduction percentages in fiscal years 2030 and 2031.

Since enactment of the PPACA, there have been, and continue to be, numerous legal challenges and Congressional actions to repeal and replace provisions of the law.

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and policies that reduce affordability of coverage or financial assistance, including for dependents.

Pharmaceutical Price Reform

The prices of prescription pharmaceuticals have also been the subject of considerable discussion in the United States.

There have been several recent U.S.

congressional inquiries, as well as proposed and enacted state and federal legislation designed to, among other things, bring more transparency to pharmaceutical pricing, review the relationship between pricing and manufacturer patient programs, and reduce the costs of pharmaceuticals under Medicare and Medicaid.

congressional inquiries, as well as proposed and enacted state and federal legislation designed to, among other things, bring more

transparency to pharmaceutical pricing, review the relationship between pricing and manufacturer patient programs, and reduce the costs of pharmaceuticals under Medicare and Medicaid.

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

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

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

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

The final rule would eliminate the current safe harbor for Medicare drug rebates and create new safe harbors for beneficiary point-of-sale discounts and pharmacy benefit manager, or PBM, service fees.

It originally was set to go into effect on January 1, 2022, but with passage of the Inflation Reduction Act of 2022, or the IRA, has been delayed by Congress to January 1, 2032.

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

The Order directs the Department of Health and Human Services, or HHS, to create a plan within 45 days to combat “excessive pricing of prescription pharmaceuticals and enhance domestic pharmaceutical supply chains, to reduce the prices paid by the federal government for such pharmaceuticals, and to address the recurrent problem of price gouging.” On September 9, 2021, HHS released its plan to reduce pharmaceutical prices.

The Order directs HHS to create a plan within 45 days to combat “excessive pricing of prescription pharmaceuticals and enhance domestic pharmaceutical supply chains, to reduce the prices paid by the federal government for such pharmaceuticals, and to address the recurrent problem of price gouging.” On September 9, 2021, HHS released its plan to reduce pharmaceutical prices.

The key features of that plan are to:

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

More recently, on August 16, 2022, the IRA was signed into law by President Biden.

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

Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap, imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023), and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).

The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

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

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

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

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

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

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

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

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In addition, regional health care authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other health care programs.

These measures could reduce the ultimate demand for our products,

once approved, or put pressure on our product pricing.

These measures could reduce the ultimate demand for our products, once approved, or put pressure on our product pricing.

We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.

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We conduct annual performance and development reviews for each of our employees to discuss the individual’s strengths and development opportunities, career development goals and performance goals.

In addition, each regular full-time employee is encouraged to attend appropriate job-related trainings and other professional development courses, seminars, meetings, and similar sessions.

In addition, each regular full-time employee is

encouraged to attend appropriate job-related trainings and other professional development courses, seminars, meetings, and similar sessions.

The principal purposes of our equity incentive plans are to attract, retain and motivate selected employees, consultants and directors through the granting of stock-based compensation awards.

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Corporate Information

Our principal offices are located at 1030 Massachusetts Ave, Suite 210, Cambridge, MA 02138, and our telephone number is (617) 952-0555.

Our principal offices are located at 200 Talcott Ave, 2nd Floor, Watertown, MA 02472, and our telephone number is (617) 952-0555.

Our website address is www.werewolftx.com.

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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 1. Business