QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
−Removed: Our exposure to market risk for changes in interest rates relates primarily to interest earned on our cash equivalents and investments.
+Added: Our exposure to market risk for changes in interest rates relates primarily to interest earned on our cash equivalents, investments and variable interest rate debt.
The primary objective of our investment activities is to preserve our capital to fund operations.
5 unchanged sentences
However, we believe that we are not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held.
−Removed: As of December 31, 2020, we did not hold or issue financial instruments for trading purposes.
−Removed: To date, we have not realized any significant loss of principal on our investments.
+Added: As of December 31, 2021, our investment portfolio was comprised of available-for-sale securities, and we did not hold or issue financial instruments for trading purposes.
Interest Rate Risk – Cash
7 unchanged sentences
At December 31, 2021, a hypothetical increase in interest rates of 100 basis points across the entire yield curve on our holdings would not have resulted in a material impact on the fair value of our portfolio.
+Added: Interest Rate Risk – Variable-Rate Debt
+Added: Our use of variable-rate debt exposes us to interest rate risk as changes in interest rates would affect interest expense.
+Added: In December 2021, we entered into a $300.0 million variable interest loan that matures on December 17, 2022.
+Added: This loan bears interest at Term SOFR + 5.4%.
+Added: As of December 31, 2021 , the interest rate on this loan was 5.47%.
+Added: A 100-basis point increase in the Term SOFR rate as of December 31, 2021 would not have a material impact on our results of operations and cash flows.
Foreign Currency Exchange Risk
−Removed: We contract with clinical research organizations, investigational sites and suppliers in foreign countries and we have a bank account in Korea .
+Added: We are exposed to foreign currency exchange rate risk inherent in conducting business globally in numerous currencies.
+Added: We contract with clinical research organizations, investigational sites and suppliers in foreign countries.
We are, therefore, subject to fluctuations in foreign currency rates in connection with these agreements.
We have not entered into any material foreign currency hedging contracts although we may do so in the future.
−Removed: To date we have not incurred any material effects from foreign currency changes on these contracts.
+Added: From inception through the date of this Annual Report, we have not incurred any material effects from foreign currency changes on these contracts.
The effect of a 10% adverse change in exchange rates on foreign currency denominated cash and payables as of December 31, 2021 would not have been material.
However, fluctuations in currency exchange rates could harm our business in the future.
+Added: We are also exposed to foreign currency fluctuations related to the operations of our subsidiary in Italy whose financial statements are denominated in the Euro.
+Added: We translate all assets and liabilities denominated in foreign currency into U.S.
+Added: dollars using the exchange rate as of the end of the reporting period, while the operating results are translated into U.S.
+Added: dollars using the average exchange rates for the reporting periods.
+Added: Gains and losses resulting from translating the financial statements from our subsidiary’s functional currency to U.S.
+Added: dollars are recognized as a component of other comprehensive income (loss) , on the consolidated statement of comprehensive loss.
+Added: Foreign currency exchange rate fluctuations affect our reported net loss and can make comparisons from period to period more difficult.
+Added: Our foreign operations are not material to our operations as a whole.
+Added: As such, we currently do not enter into currency forward exchange or option contracts to hedge foreign currency exposures.
Inflation Risk
2 unchanged sentences
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.