What changed in this filing

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Item 1A. Risk Factors

2021-11-15 compared with 2021-08-10 · 50 added, 37 removed, 1440 unchanged (6% of the section changed)

21 unchanged sentences

We rely on third parties for the manufacture of our product candidates for preclinical and clinical development and expect to continue to do so for the foreseeable future.

This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or products or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts;

This reliance on third parties

increases the risk that we will not have sufficient quantities of our product candidates or products or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts ;

We face significant competition in an environment of rapid technological and scientific change, and our failure to effectively compete may prevent us from achieving significant market penetration.

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We have had significant operating losses since our inception.

Our net losses for the six months ended June 30, 2021 and June 30, 2020 were $20.0 million and $24.4 million, respectively.

As of June 30, 2021, we had an accumulated deficit of $147.0 million.

Our net losses for the nine months ended September 30, 2021 and September 30, 2020 were $31.6 million and $29.4 million, respectively.

As of September 30, 2021, we had an accumulated deficit of $158.5 million.

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

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Preclinical studies and clinical trials and additional research and development activities will require substantial funds to complete.

As of June 30, 2021, we had cash, cash equivalents and marketable securities of $312.4 million.

As of September 30, 2021, we had cash, cash equivalents and marketable securities of $385.8 million.

We believe that we will continue to expend substantial resources for the foreseeable future in connection with the research and development of our precision medicine target and biomarker discovery platform, clinical and preclinical product candidates, and any other future product candidates we may choose to pursue, as well as other corporate uses.

Specifically, in the near term, we expect to incur substantial expenses as we advance our synthetic lethality product candidates through preclinical studies, advance darovasertib and IDE397 through clinical development, seek regulatory approval, prepare for and, if approved, proceed to commercialization, and continue our research and development efforts.

These expenses will include our cost sharing obligations with GSK for research and development for our WRN program and MAT2A program (if GSK exercises its exclusive option to obtain an exclusive license to continue development of and commercialize MAT2A products).

These expenses will include our cost sharing obligations with GSK for research and development for our WRN program and MAT2A program (if GSK exercises

its exclusive option to obtain an exclusive license to continue development of and commercialize MAT2A products ).

These expenditures will include costs associated with conducting preclinical studies and clinical trials, obtaining regulatory approvals, and manufacturing and supply, as well as marketing and selling any products approved for sale.

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We are required to comply with certain regulatory requirements, and the FDA may identify specific clinical or other development-related requirements that we must satisfy, as a condition to initiating or continuing our clinical trials;

we fail to meet such a requirement, the FDA may issue a clinical hold or designate other conditions on our clinical trials.

if we fail to meet such a requirement, the FDA may issue a clinical hold or designate other conditions on our clinical trials.

Consequently, we may be unable to successfully and efficiently execute and complete necessary clinical trials in a way that leads to regulatory submission of a marketing application for, and approval of, darovasertib, IDE397, or any of our other product candidates.

We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of product candidates that we develop.

Failure to commence or complete, or delays in, our planned clinical trials, could prevent or delay GSK’s exercise of the Option with respect to any MAT2A product, or prevent us from or delay us in commercializing darovasertib or any other product candidate.

Failure to commence or

complete, or delays in, our planned clinical trials, could prevent or delay GSK’s exercise of the Option with respect to any MAT2A product, or prevent us from or delay us in commercializing darovasertib or any other product candidate.

The successful development of targeted therapeutics, including therapeutics involving direct targeting of an oncogenic pathway and synthetic lethality therapeutics, including our portfolio of synthetic lethality small molecule inhibitors, as well as any related diagnostics, is highly uncertain.

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As a result of these factors, it is more difficult for us to predict the time and cost of product candidate development, and we cannot predict whether the application of our precision medicine target and biomarker discovery platform will result in the identification, development, and regulatory approval of any products.

The length of time necessary to complete clinical trials and to submit an application for marketing approval for a decision by a regulatory authority may be difficult to predict for targeted therapeutic small molecule inhibitors, in large part because of the limited regulatory history associated with them.

The length of time necessary

to complete clinical trials and to submit an application for marketing approval for a decision by a regulatory authority may be difficult to predict for targeted therapeutic small molecule inhibitors, in large part because of the limited regulatory history associated with them.

The clinical trial requirements of the FDA and other comparable foreign regulatory authorities and the criteria these regulators use to determine the safety and efficacy of a product candidate vary substantially according to the type, complexity, novelty and intended use and market of the product candidate.

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In either case, our development costs would increase.

Our clinical trial collaboration and supply agreement with Pfizer for the supply of their MEK inhibitor, binimetinib, and their cMET inhibitor, crizotinib, supports our plans to evaluate the safety and efficacy of darovasertib in combination with binimetinib and in combination with crizotinib in Phase 1/2 clinical trial arms that we initiated in June 2020 and December 2020, respectively.

If Pfizer delays or fails to supply binimetinib or crizotinib in support of the combination arms of the darovasertib clinical trial, the development program as pertaining to combination of darovasertib with either a MEK inhibitor or a cMET inhibitor may be significantly delayed, and our development costs may increase.

June 2020 and December 2020, respectively .

If Pfizer delays or fails to supply binimetinib or crizotinib in support of the combination arm s of the darovasertib clinical trial, the development program as pertaining to combination of darovasertib with either a MEK inhibitor or a cMET inhibitor may be significantly delayed, and our development costs may increase.

Subject to completion of and satisfactory results from preclinical studies, we may evaluate darovasertib in combination with one or more anti-cancer agent(s) in addition to binimetinib and crizotinib , such as a different inhibitor of MEK or cMET or an inhibitor of FAK, mTOR and/or CDK4/6, in a Phase 1/2 clinical trial in patients with metastatic uveal melanoma.

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Similarly, the ability to recruit and retain patients, and principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19, may be delayed or disrupted, which may adversely impact our clinical trial operations.

Additionally, certain of our CROs that support our clinical trials have personnel, including related to data management and master file management, based in India, which has experienced a recent surge in COVID-19 infections, which may adversely impact our clinical trial operations.

If patients are unwilling to participate in our clinical trials for any reason, including the existence of other approved therapies or concurrent clinical trials for similar patient populations, if they are unwilling to enroll in a clinical trial with a placebo-controlled design, or we otherwise have difficulty enrolling a sufficient number of patients, the timeline for recruiting patients, conducting studies and obtaining regulatory approval of our product candidates may be delayed.

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To date, only two of our product candidates, IDE397 and darovasertib, have been tested in clinical trials, including an ongoing Phase 1 clinical trial of IDE397 and an ongoing Phase 1 clinical trial and an ongoing Phase 1/2 clinical trial of darovasertib, and they have been observed to be generally well tolerated, with certain drug-related SAEs and AEs being reported for darovasertib, as monotherapy and in combination with binimetinib and in combination with crizotinib.

If unacceptable side effects arise in the further development of darovasertib, including in combination with binimetinib or crizotinib, in the further development of IDE397, or in the development of any of our other product candidates, we, the FDA, or the IRBs at the institutions in which the clinical trials are being conducted could suspend or terminate our clinical trials or the FDA or a comparable foreign regulatory authority could order us to cease clinical trials or deny approval of our product candidates for any or all targeted indications.

to cease clinical trials or deny approval of our product candidates for any or all targeted indications.

Treatment-related side effects could also affect patient recruitment or the ability of enrolled patients to complete any of our clinical trials or result in potential product liability claims.

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For darovasertib, our small molecule inhibitor targeting PKC in genetically-defined solid tumors having GNAQ or GNA11 mutations or other genetic alterations that activate the PKC signaling pathway, other companies are conducting research and development of potential therapies for metastatic uveal melanoma based on other targets and approaches.

For example, Immunocore is developing IMCgp100 (tebentafusp) as monotherapy for metastatic uveal melanoma in a current Phase 3 clinical trial for patients with the HLA-A2 allele.

Immunocore has disclosed in regulatory filings that of the approximately 5,000 to 6,000 estimated new cases of primary uveal melanoma per annum, there is an estimated addressable patient population of 1,000 patients per annum which have metastatic uveal melanoma that are HLA-A*02:01-positive and will be eligible for treatment with tebentafusp.

For example, Immunocore is developing IMCgp100 (tebentafusp) as monotherapy for metastatic uveal melanoma for patients with the HLA-A2 allele and a Biologics License Application (BLA) for tebentafusp was accepted for review by the FDA in the third quarter of 2021.

eligible for treatment with tebentafusp .

For our pipeline of small molecule therapeutics based on synthetic lethality, potential competition includes established companies as well as earlier-stage emerging biotechnology companies.

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We expect to expand our development and regulatory capabilities and potentially implement sales and distribution capabilities, and as a result, we will need to increase the size of our organization, and we may experience difficulties in managing growth.

As of June 30, 2021, we had 75 employees.

As of September 30, 2021, we had 83 employees.

We will need to continue to expand our managerial, operational, finance and other resources in order to manage our operations and clinical trials, continue our development activities, submit for regulatory approval and, if approved, commercialize our product candidates or any future product candidates.

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

Any failure or delay in the development of our internal sales,

marketing and distribution capabilities would adversely impact the commercialization of these products.

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

Under our GSK Collaboration Agreement, GSK will be responsible for commercialization of any MAT2A (if GSK exercises the Option and obtains HSR Clearance thereof), POLQ, or WRN products.

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

It is not always possible to identify and deter misconduct by employees and other third-parties, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations.

in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations.

In addition, we are subject to the risk that a person or government could allege such fraud or other misconduct, even if none occurred.

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Together, these programs require significant capital investment.

The directly targeted therapy programs are at various stages of preclinical and early clinical development, and our synthetic lethality programs are in the target identification, validation, lead optimization, and early clinical stages of development.

The directly targeted therapy

programs are at various stages of preclinical and early clinical development, and our synthetic lethality programs are in the target identification, validation , lead optimization , and early clinical stages of development.

We seek to maintain a process of prioritization and resource allocation to maintain an optimal balance between advancing and expanding our synthetic lethality and direct targeting programs.

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The governors of California and over forty other states, as well as mayors of many cities, ordered their residents to cease traveling to non-essential jobs and to curtail all unnecessary travel, and to stay in their homes as much as possible.

As of July 2021, the coronavirus has spread to most regions of the world and the United States continues to experience significant COVID-19 outbreaks, particularly in certain states.

As of October 2021, the coronavirus has spread to most regions of the world and the United States continues to experience significant outbreaks of COVID-19 and its variant strains, particularly in certain states.

If the current economic conditions worsen or last for an extended period of time, we will be forced to significantly scale back our business and growth plans, which could have a material adverse effect on our business, results of operations and financial condition.

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Individuals at our company or at such third parties could become ill, quarantined, or otherwise unable to work and/or travel due to health reasons or governmental restrictions.

We have requested that most of our personnel, including all of our administrative employees, work remotely, restricting on-site staff to only those personnel and contractors who perform activities that must be completed on-site.

We have requested that many of our personnel, including all of our administrative employees, work remotely, restricting on-site staff to generally only those personnel and contractors who perform research activities.

The COVID-19 pandemic could disrupt our ability to secure supplies for our facilities and to provide personal protective equipment for our employees.

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The FDA intends to use this risk-based assessment system to identify the categories of regulatory activity that can occur within a given geographic area, ranging from mission critical inspections to resumption of all regulatory activities.

Regulatory authorities outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic, including providing guidance regarding the conduct of clinical trials.

Regulatory authorities outside the

United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic, including providing guidance regarding the conduct of clinical trials.

In addition, the COVID-19 pandemic may affect the operations of the FDA and other health authorities, which could result in delays of reviews and approvals, including with respect to our product candidates.

3 unchanged sentences

Similarly, our ability to recruit and retain principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19, may be delayed or disrupted, which may adversely impact our clinical trial operations.

Additionally, c ertain of our CROs that support our clinical trials have personnel, including personnel related to our data management and master file management, based in India, which has experienced a recent surge in COVID-19 infections, and as a result may adversely impact our clinical trial operations .

While the COVID-19 pandemic did not materially adversely affect our business operations in the quarter ended June 30, 2021, economic and health conditions in the United States and across most of the globe continue to change rapidly and may materially affect us economically.

While the COVID-19 pandemic did not materially adversely affect our business operations in the quarter ended September 30, 2021, economic and health conditions in the United States and across most of the globe continue to change rapidly and may materially affect us economically.

While the potential economic impact brought by, and the duration of, COVID-19 may be difficult to assess or predict, a continuing widespread pandemic could result in significant disruption of global financial markets, reducing our ability to access capital, which could in the future negatively affect our liquidity.

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We are using bioinformatics, including data analytics, biostatistics, and computational biology, to identify new target and biomarker opportunities.

As part of this approach, we interrogate public and proprietary databases comprising human tumor genetic information and specific cancer-target dependency networks.

As part of this approach, we interrogate public and proprietary databases

comprising human tumor genetic information and specific cancer-target dependency networks.

We rely on these databases and data analytics for identifying or validating some of our biomarker-target relationships and access to these databases may not continue to be available publicly or through a proprietary subscription on acceptable terms.

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Any of these factors could cause the delay of approval or commercialization of any products, cause us to incur higher costs or prevent us from commercializing any products successfully.

Furthermore, if any of our product candidates are approved and contract manufacturers fail to deliver the required commercial quantities of finished product on a timely basis and at commercially reasonable prices, and we are unable to find one or more replacement manufacturers capable of production at a substantially equivalent cost, in substantially equivalent volumes and quality and on a timely basis, we would likely be unable to meet demand for our products and could lose potential revenue.

quality and on a timely basis, we would likely be unable to meet demand for our products and could lose potential revenue.

It may take several years to establish an alternative source of supply for our product candidates and to have any such new source approved by the FDA or any other relevant regulatory authority.

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Failure to obtain or maintain coverage and adequate reimbursement for products, if approved, could limit our ability to market those products and decrease our ability to generate revenue.

The availability of coverage and adequacy of reimbursement by governmental healthcare programs, such as Medicare and Medicaid, private health insurers, managed care plans and other third-party payors are essential for most patients to be able to afford medical services and pharmaceutical products such as our product candidates that receive FDA approval.

receive FDA approval.

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

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Our patent applications cannot be enforced against third parties practicing the inventions claimed in such applications unless, and until, patents issue from such applications, and then only to the extent the issued claims cover the invention as claimed.

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

in protecting our product candidates and proprietary technologies by obtaining and defending patents.

These risks and uncertainties include the following:

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Our competitors in both the United States and abroad, many of which have substantially greater resources and have made substantial investments in patent portfolios and competing technologies, may have applied for or obtained or may in the future apply for and obtain, patents that will prevent, limit or otherwise interfere with our ability to make, use and sell our product candidates.

There is a substantial amount of litigation, both within and outside the United States, involving patent and other intellectual property rights in the biotechnology and pharmaceutical industries, including patent infringement lawsuits, interferences, oppositions, reexaminations, inter partes review proceedings and post-grant review proceedings before the USPTO

and/or corresponding foreign patent offices.

Numerous third-party U.S.

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In addition, identification of third-party patent rights that may be relevant to our technology is difficult because patent searching is imperfect due to differences in terminology among patents, incomplete databases and the difficulty in assessing the meaning of patent claims.

Although no third party has asserted a claim of patent infringement against us as of June 30, 2021, others may hold proprietary rights that could prevent darovasertib, IDE397, our other product candidates or any future product candidates from being marketed.

Although no third party has asserted a claim of patent infringement against us as of September 30, 2021, others may hold proprietary rights that could prevent darovasertib, IDE397, our other product candidates or any future product candidates from being marketed.

Any patent-related legal action against us claiming damages and seeking to enjoin commercial activities relating to our product candidates or proprietary technologies could subject us to potential liability for damages, including treble damages if we were determined to willfully infringe or attorney’s fees and costs of litigation to the party whose intellectual property rights we may be found to be infringing, and require us to obtain a license to manufacture or market darovasertib, IDE397 (if GSK does not exercise its option to obtain an exclusive license to continue development of and commercialize MAT2A products), our other product candidates or any future product candidates.

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Grounds for a validity challenge include an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement.

Grounds for an unenforceability assertion could include an allegation that someone connected with prosecution of the patent withheld relevant information from the USPTO or made a misleading statement during prosecution.

Grounds for an unenforceability assertion could include an allegation that someone connected with prosecution of the patent withheld relevant

information from the USPTO or made a misleading statement during prosecution.

Third parties may also raise similar claims before the USPTO, even outside the context of litigation.

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If our existing stockholders sell, or indicate an intention to sell, substantial amounts of our common stock in the public market, the trading price of our common stock could decline.

As of June 30, 2021, we have outstanding a total of 33.0 million shares of common stock, of which the holders of approximately 2.3 million shares of our common stock are entitled to rights with respect to the registration of their shares under the Securities Act.

As of September 30, 2021, we have outstanding a total of 38.5 million shares of common stock, of which the holders of approximately 2.3 million shares of our common stock are entitled to rights with respect to the registration of their shares under the Securities Act.

Registration of these shares under the Securities Act would result in the shares becoming freely tradable without restriction under the Securities Act, except for shares purchased by affiliates.

Any sales of securities by these stockholders could have a material adverse effect on the trading price of our common stock.

In addition, as of June 30, 2021, approximately 5.3 million shares of common stock that are either subject to outstanding options or reserved for future issuance under our existing equity incentive plan will become eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules, Rule 144 and Rule 701 under the Securities Act.

In addition, as of September 30, 2021, approximately 5.2 million shares of common stock that are either subject to outstanding options or reserved for future issuance under our existing equity incentive plan will become eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules, Rule 144 and Rule 701 under the Securities Act.

If these additional shares of common stock are sold, or if it is perceived that they will be sold, in the public market, the trading price of our common stock could decline.

1 unchanged sentence

Our information technology systems, or those of our collaborators, CROs or other contractors or consultants, may fail or suffer security breaches, which could adversely affect our business.

Security breaches, loss of data or financial assets, and other disruptions could compromise sensitive information related to our business or prevent us from accessing critical information and expose us to liability.

Security breaches, loss of data or

financial assets, and other disruptions could compromise sensitive information related to our business or prevent us from accessing critical information and expose us to liability.

We collect and maintain information in digital form that is necessary to conduct our business, and we are increasingly dependent on information technology systems and infrastructure to operate our business.

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Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, if a corporation undergoes an “ownership change,” generally defined as a greater than 50 percentage point change (by value) in its equity ownership by certain stockholders over a three-year period, the corporation’s ability to use its pre-change net operating loss carryforwards, or NOLs, and other pre-change tax attributes (such as research and development tax credits) to offset its post-change taxable income or tax liability may be limited.

have experienced ownership changes in the past and in the current year.

We have experienced ownership changes in the past and in the current year.

As a result of such ownership changes, our ability to utilize certain NOLs and other tax attributes may be permanently limited as such attributes will expire unused.

1 unchanged sentence

If finalized, Treasury Regulations currently proposed under Section 382 of the Code may further limit our ability to utilize our pre-change NOLs or credits if we undergo a future ownership change.

We have experienced ownership changes in the past and in the current year , and we may experience ownership changes in the future and/or subsequent shifts in our stock ownership (some of which may be outside our control).

We have experienced ownership changes in

the past and in the current year , and we may experience ownership changes in the future and/or subsequent shifts in our stock ownership (some of which may be outside our control).

As a result, even if we attain profitability, we may be unable to use a material portion of our NOLs and other tax attributes, which could potentially result in increased future tax liability to us.

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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-Q

Item 1A. Risk Factors