What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2025-03-31 compared with 2024-02-22 · 139 added, 129 removed, 891 unchanged (23% of the section changed)

1 unchanged sentence

Investing in our common stock involves a high degree of risk.

Before deciding to invest in our company or deciding to maintain or increase your investment, you should consider carefully the risks and uncertainties described below.

Before deciding to invest in our company or deciding to maintain or increase your investment, you should consider carefully the risks and uncertainties described below and elsewhere in this Annual Report and in our other filings made with the SEC from time to time.

The risks and uncertainties described below and in our other filings with the SEC are not the only risks we face.

10 unchanged sentences

• We currently have no source of product sales revenue and may never earn product revenue or be profitable.

• We will require substantial additional funding, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product development, other operations or future commercialization efforts.

• We will require substantial additional funding in the current year, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product development, other operations or future commercialization efforts.

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

3 unchanged sentences

Because the results of earlier clinical trials are not necessarily predictive of future results, any product candidate we advance through clinical trials may not have favorable results in later clinical trials or receive marketing approval.

The effect of failure or results different than expectations can result in significant market value decline and possible negative financial results or asset related impairment.

The effect of failure or results different than expectations can result in significant market value decline and possible negative financial results or asset impairment.

• Our product candidates may cause undesirable adverse effects or have other properties that could delay or prevent their marketing approval, limit the commercial profile of an approved label or result in significant negative consequences following marketing approval, if obtained.

7 unchanged sentences

If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our product candidates, if and when regulatory approval is received, we may be unable to generate any revenue.

• If we fail to enter into strategic relationships or collaborations, our business, financial condition, commercialization prospects and results of operations may be materially adversely affected.

• If we fail to enter into strategic relationships or collaborations, our business, financial condition, drug development plans, commercialization prospects and results of operations may be materially adversely affected.

• Coverage and reimbursement may be limited or unavailable in certain market segments for our product candidates, which could make it difficult for us to sell our products profitably.

• We face substantial competition, which may result in others discovering, developing or commercializing products before, or more successfully than, we do.

• The size of the potential market for our product candidates is difficult to estimate and, if any of our assumptions are inaccurate, the actual markets for our product candidates may be smaller than our estimates.

• We may be unable to realize the potential benefits of any collaboration.

• We may be unable to realize the potential benefits of any collaboration that we might enter into in the future.

• Our proprietary rights may not adequately protect our technologies and product candidates.

• We may not be able to protect our intellectual property rights throughout the world.

• Intellectual property rights do not protect against all potential threats to our competitive advantage.

• Intellectual property rights do not protect against all potential threats to our potential competitive advantage.

• We incur significant costs and demands upon management as a result of complying with the laws and regulations affecting public companies.

• Our failure to meet the $1.00 minimum bid price or other continued listing requirements of Nasdaq could result in a delisting of our common stock, which could negatively impact the market price and liquidity of our common stock and our ability to access the capital markets.

• Our failure to meet the $1.00 minimum bid price or other continued listing requirements of Nasdaq could result in a delisting of our common stock, which would negatively impact the market price and liquidity of our common stock and our ability to access the capital markets.

• The market price of our common stock has been and is expected to continue to be volatile.

5 unchanged sentences

Additionally, general supply chain issues may be exacerbated during disease outbreaks, epidemics or pandemics and may also impact the ability of our clinical trial sites to obtain basic medical supplies used in our trials in a timely fashion, if at all.

We did experience some interruptions and delays of our business plan during the coronavirus pandemic.

Moreover, the extent to which disease outbreaks, epidemics and pandemics may impact our business, results of operations and financial position will depend on future developments, which are highly uncertain and cannot be predicted with confidence.

3 unchanged sentences

Adverse macroeconomic conditions, including inflation, slower growth or recession, higher interest rates, currency fluctuations, supply chain delays or shortages, high unemployment or personnel shortages could hurt our business.

We have already seen a general increase in many of our costs as a result of inflation, although inflation has not yet had a material impact on our results of operations.

We have continued to see a general increase in many of our costs as a result of inflation, although inflation has not yet had a material impact on our results of operations.

However, the economies of Germany, the United States, Australia and other countries in which we do business have experienced high rates of inflation during 2022, 2023 and 2024 and, if inflation were to continue for a prolonged period of time or the rate of inflation in our markets were to increase, or if a global recession were to occur, our expenses could increase substantially, resulting in increased losses from operations and net loss.

2 unchanged sentences

Our clinical trials of vidofludimus calcium were originally planned to be conducted at more than 60 sites in Ukraine and Russia, but most had to be relocated to other countries because of the invasion of Ukraine by Russia in February 2022 and resulting sanctions imposed on Russia by the United States and other countries.

These disruptions delayed our clinical development program, increased our costs and may disrupt future planned clinical development activities in these two

This military action has continued for more than two years and its future course and effects on our Company are highly unpredictable.

These disruptions delayed our clinical development program, increased our costs and may disrupt future planned clinical development activities in these two countries.

This military action has continued for more than three years and its future course and effects on our Company are highly unpredictable.

We currently have 35 active sites in western Ukraine and the ongoing conflict could put the data associated with these patients in jeopardy as well as extend patient recruitment timelines.

We anticipate that Ukraine will make up approximately 20% of our ENSURE- 1 and ENSURE-2 phase 3 patient population.

Ukraine is expected to make up a significant percentage of our ENSURE- 1 and ENSURE-2 phase 3 patient population.

Alternative sites to fully and timely compensate for our clinical trial activities in Ukraine may not continue to be available.

15 unchanged sentences

However pharmaceutical product development is an extremely costly and highly speculative undertaking and involves a substantial degree of risk.

In addition, if we obtain regulatory approval to market a product candidate, our future revenue will depend upon the size of any markets in which our product candidates may receive regulatory approval, and our ability to achieve sufficient market acceptance, pricing, reimbursement from third-party payors, and adequate market share for our product candidates.

In addition, if we obtain regulatory approval to market a product candidate, our future revenue will depend upon the size of any markets in which our

product candidates may receive regulatory approval, and our ability to achieve sufficient market acceptance, pricing, reimbursement from third-party payors, and adequate market share for our product candidates.

Even if we eventually obtain adequate market share for our product candidates, to the extent they receive regulatory and market approval and authorization for reimbursement, the potential markets for our product candidates may not be large enough for us to become profitable.

27 unchanged sentences

• attract, hire and retain qualified personnel.

In addition, because of the numerous risks and uncertainties associated with clinical product development, including that our product candidates may not advance through development or achieve regulatory approval, we are unable to predict the timing or amount of any potential future product sale revenues.

timing or amount of any potential future product sales revenue.

Our expenses also could increase beyond expectations if we decide to, or are required by the FDA or comparable foreign regulatory authorities to, perform studies or trials in addition to those that we currently anticipate.

6 unchanged sentences

We believe that we will continue to expend substantial resources for the foreseeable future toward the completion of clinical development and regulatory preparedness of our product candidates, preparations for a commercial launch of any approved product candidates, and development of any other current or future product candidates we may choose to further develop.

These expenditures will include costs associated with research and

development, conducting preclinical studies and clinical trials, seeking marketing approvals, and manufacturing and supply as well as marketing and selling any products approved for sale.

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

In addition, other unanticipated costs may arise.

3 unchanged sentences

In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans.

We believe that our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements into the third quarter of 2025.

Our estimate as to how long we expect our existing cash and cash equivalents to continue to fund our operations is based on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect.

21 unchanged sentences

If we raise additional funds through strategic collaborations and alliances and licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies or product candidates, or grant licenses on terms unfavorable to us.

As part of the January 2024 Financing, tranche 2 of this financing could result in an additional $80 million of funding at a price of $1.716 which would result in an additional 46.6 million of common stock being issued.

Our independent registered public accounting firm ’ s report contains an explanatory paragraph that expresses substantial doubt about our ability continue as a “ going concern .

The auditor’s opinion on our audited consolidated financial statements for the year ended December 31, 2024 includes an explanatory paragraph stating that our losses and negative cash flows from operations and uncertainty in generating sufficient cash to meet our operating obligations raise substantial doubt about our ability to continue as a “going concern.” Although we have continued to pursue a variety of funding sources and transactions that could potentially raise capital, we have not been successful in these efforts since January 2024, and possible sources of funding may be unwilling to provide additional funding on commercially reasonable terms, or at all, following the issuance by Baker Tilly US.

LLP of a “going concern” opinion.

If we are unable to obtain sufficient funding to continue as a going concern, we will be forced to cease operations and seek to liquidate our assets.

We may receive substantially less than the value at which those assets are carried on our audited consolidated financial statements, and it is likely that investors will lose all or a substantial part of their investment.

Risks Related to the Clinical Development and Marketing Approval of Our Product Candidates

19 unchanged sentences

In addition, the FDA may not consider any additional information to be complete or sufficient to support the filing or approval of the NDA.

Policies and actions of the new administration of President Trump could lead to additional uncertainties and delays in the FDA review and approval processes.

Announced intentions to decrease headcount and expenses at government agencies, reduce regulation and increase government efficiency, and other initiatives could result in our incurring substantial additional time and expense to complete the development of, and seek and obtain marketing approval for, our product candidates in a timely manner.

Regulatory authorities outside of the United States, such as in Europe and Japan and in emerging markets, also have requirements for approval of drugs for commercial sale with which we must comply prior to marketing in those jurisdictions.

4 unchanged sentences

Seeking foreign regulatory approval could require additional non-clinical studies or clinical trials, which could be costly and time-consuming.

Foreign regulatory approval may be subject to all of the risks associated with obtaining FDA approval.

Foreign regulatory approval may be subject to all of the risks and uncertainties associated with obtaining FDA approval.

For all of these reasons, we may not obtain foreign regulatory approvals on a timely basis, if at all.

5 unchanged sentences

Also, marketing approval for any of our product candidates may be withdrawn.

If we are unable to obtain and maintain marketing approval for our product candidates in one or more jurisdictions, or any approval contains significant limitations, our ability to market our product candidates to our full target market will be reduced and our ability to realize the full market potential of our product candidates will be impaired.

product candidates will be impaired.

Furthermore, we may not be able to obtain sufficient funding or generate sufficient revenue and cash flows to continue or complete the development of any of our current or future product candidates.

4 unchanged sentences

Our future clinical trial results also may not be successful.

It is impossible to predict the extent to which the clinical trial process may be affected by existing or prospective legislative and regulatory developments.

Due to these and other factors, our current or future product candidates could take significantly longer than expected to gain marketing approval, if at all.

It is impossible to predict the extent to which the clinical trial process may be affected by existing or prospective legislative and regulatory developments or initiatives to reduce or eliminate regulation, decrease headcount and expenses at government agencies, and increase government efficiency.

Due to these and other factors, our current or future product candidates could take significantly longer and cost more than expected to gain marketing approval, if at all.

This could delay or eliminate any potential product revenue by delaying or terminating the potential commercialization of our current product candidates.

17 unchanged sentences

• our third-party research and manufacturing contractors failing to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all;

• third-party researchers becoming debarred or otherwise penalized by the FDA or other regulatory authorities for violations of regulatory requirements, which could call into question data collected by such researcher and potentially affecting our ability rely on some or all of the data in support of our marketing applications;

• third-party researchers becoming debarred or otherwise penalized by the FDA or other regulatory authorities for violations of regulatory requirements, which could call into question data collected by such researcher and potentially affecting our ability to rely on some or all of the data in support of our marketing applications;

• difficulty in maintaining contact with patients after treatment, resulting in incomplete data;

15 unchanged sentences

The FDA may evaluate the reported information and conclude that a financial relationship between us and a clinical investigator has created a conflict of interest or otherwise affected interpretation of the study.

The FDA may therefore question the integrity of the data generated at the applicable clinical trial site, and the utility of the clinical trial itself

may be jeopardized.

The FDA may therefore question the integrity of the data generated at the applicable clinical trial site, and the utility of the clinical trial itself may be jeopardized.

The FDA may refuse to accept our marketing applications, and other delays or even denial of marketing approval could result.

Preclinical testing or clinical trials of any development candidate may also show new and unexpected findings regarding safety and tolerability.

Such findings may harm the ability to conduct further development of product candidates, delay such development, require additional expensive tests, harm our ability to partner these development candidates, or delay or prevent marketing approval by regulatory agencies.

Such findings may also harm the ability to compete in the market with other products or to achieve certain pricing thresholds.

Such findings may harm the ability to conduct further development of product candidates, delay such development, require additional expensive tests, harm our ability to attract, establish and maintain strategic collaborations, licensing or other arrangements for these development candidates, or delay or prevent marketing approval by regulatory agencies.

Such findings may also harm our ability to compete in the market with other products or to achieve certain pricing thresholds.

Any of these occurrences could materially adversely affect our business, financial condition, results of operations, and prospects.

26 unchanged sentences

We do not know whether any clinical trials we may conduct will demonstrate consistent and/or adequate efficacy and safety to obtain marketing approval for our product candidates.

In October 2024, an independent data monitoring committee, or IDMC, conducted a non-binding, interim futility analysis of our phase IMU-838 3 ENSURE program for the treatment of RMS and reported that the trials are not futile and should continue as planned.

In addition, the IDMC recommended that we continue the trials without any adjustment to the sample sizes of each trial.

There can be no assurances that the observations made at the interim regarding futility will be consistent with the final study results for various reasons, including that the final study results based upon the full sample size may not be consistent with the results achieved by the limited sample size used to conduct the interim analysis and the current sample size of approximately 1,050 adult patients with active RMS patients for each trial may not be sufficiently large to demonstrate efficacy.

Our product candidates may cause undesirable adverse effects or have other properties that could delay or prevent their marketing approval, limit the commercial profile of an approved label or result in significant negative consequences following marketing approval, if obtained.

1 unchanged sentence

If any of our current or future product candidates is associated with serious adverse, undesirable or unacceptable side effects, we may need to abandon such candidate’s development or limit development to certain uses or sub-populations in which such side effects are less prevalent, less severe or more acceptable from a risk-benefit perspective.

Many drug candidates that initially showed promise in early-stage or clinical testing have later been found to cause side effects that prevented their further development.

Many drug candidates that initially showed promise in early-stage clinical testing have later been found to cause side effects that prevented their further development.

Results of our trials could reveal a high and unacceptable prevalence of these or other side effects.

19 unchanged sentences

We cannot be certain that any of our product candidates will be successful in clinical trials or receive regulatory approval.

Further, our product candidates may not receive regulatory approval even if they are successful in

clinical trials.

Further, our product candidates may not receive regulatory approval even if they are successful in clinical trials.

If we do not receive regulatory approvals for our product candidates, we may not be able to continue our operations.

5 unchanged sentences

If we do not accurately evaluate and predict the commercial potential or target market for a particular product candidate, we may (i) relinquish valuable rights to that product candidate through strategic collaborations, licensing or other royalty arrangements when it would have been more advantageous to retain sole development and commercialization rights to such product candidate, or (ii) allocate internal resources to a product candidate in a therapeutic area in which it would have been more advantageous to enter into a collaborative arrangement.

We may find it difficult to enroll patients in our clinical trials given the limited number of patients who have the diseases for which our product candidates are being studied.

We may find it difficult to enroll patients in our clinical trials given the limited number of patients who have the diseases for which some of our product candidates are being studied.

Difficulty in enrolling patients could delay or prevent clinical trials of our product candidates.

5 unchanged sentences

If we experience delays in the completion of, or experience termination of, any clinical trials of our product candidates, the commercial prospects of our product candidates could be harmed, and our ability to generate product revenue from product candidates could be delayed or impaired.

We have recently experienced delays in our planned clinical trials of vidofludimus calcium at sites in Ukraine and Russia because of the invasion of Ukraine by Russia in 2022 and the ongoing conflict.

We have experienced delays in our planned clinical trials of vidofludimus calcium at sites in Ukraine and Russia because of the invasion of Ukraine by Russia in 2022 and the ongoing conflict.

These and other delays we may encounter in initiating or completing clinical trials would likely increase our overall costs, impair product candidate development and impair our ability to obtain regulatory approval.

5 unchanged sentences

Any marketing approvals that we receive for our product candidates may also be subject to limitations on the approved indicated uses for which the product may be marketed or subject to conditions of approval, or contain requirements for potentially costly post-approval studies, including Phase 4 clinical trials, and surveillance to monitor safety and efficacy.

The FDA may also require us to implement a Risk Evaluation and Mitigation

Strategy drug safety program as a condition of approval of our product candidates, which could include requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.

Later discovery of previously unknown problems with an approved product, including adverse events of unanticipated severity or frequency, or problems with manufacturing operations or processes, or failure to comply with regulatory requirements, or evidence of acts that raise questions about the integrity of data supporting the product approval, may result in, among other things:

The FDA may also require us to implement a Risk Evaluation and Mitigation Strategy drug safety program as a condition of approval of our product candidates, which could include requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.

requirements, or evidence of acts that raise questions about the integrity of data supporting the product approval, may result in, among other things:

• restrictions on product distribution or use, or requirements to conduct post-marketing studies or clinical trials;

11 unchanged sentences

Such marketing will require separate regulatory approvals in each market and compliance with numerous and varying regulatory requirements.

The approval procedures vary from country to country and may require testing in addition to what is required for a marketing application in the United States.

The approval procedures vary from country to country and may require testing in addition to what is required for a marketing approval in the United States.

Moreover, the time required to obtain approval in other countries may be different than in the United States.

12 unchanged sentences

For example, the FDA requires substantial evidence, which generally consists of two adequate and well-controlled head-to-head clinical trials, for a company to make a claim that its product is superior to another product in terms of safety or effectiveness.

Generally, unless we perform clinical trials meeting that standard comparing our product candidates to competing products and these claims are approved for our product labeling, we will not be able promote our product candidates as superior to competing products.

Generally, unless we perform clinical trials meeting that standard comparing our product candidates to competing

products and these claims are approved for our product labeling, we will not be able to promote our product candidates as superior to competing products.

In the United States, regulatory authorities actively enforce the laws and regulations prohibiting the promotion of off-label uses.

18 unchanged sentences

• The civil monetary penalties statute imposes penalties against any person or entity who, among other things, is determined to have presented or caused to be presented a claim to a federal healthcare program that the person knows or should know is for an item or service that was not provided as claimed or is false or fraudulent.

• The federal Health Insurance Portability and Accountability Act of 1996 ("HIPAA") imposes criminal and civil penalties for knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private), knowingly and willfully embezzling or stealing from a health care benefit program, willfully

obstructing a criminal investigation of a healthcare offense and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters.

program or obtain, by means of false or fraudulent pretenses, representations or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private), knowingly and willfully embezzling or stealing from a health care benefit program, willfully obstructing a criminal investigation of a healthcare offense and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters.

• HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, and its implementing regulations impose obligations on covered entities, including healthcare providers, health plans, and healthcare clearinghouses, as well as their respective business associates that create, receive, maintain or transmit individually identifiable health information for or on behalf of a covered entity, with respect to safeguarding the privacy, security and transmission of individually identifiable health information.

18 unchanged sentences

Foreign Corrupt Practices Act ("FCPA"), and other anti-corruption laws that apply in countries where we do, or may in the future do, business.

The FCPA and these other laws generally prohibit us and our employees and intermediaries from bribing, being bribed or making other prohibited payments to government officials or other persons to obtain or retain business or gain some other business advantage.

The FCPA and these other laws

generally prohibit us and our employees and intermediaries from bribing, being bribed or making other prohibited payments to government officials or other persons to obtain or retain business or gain some other business advantage.

We also may participate in collaborations and relationships with third parties whose actions, if non-compliant, could potentially subject us to liability under the FCPA or local anti-corruption laws.

In addition, we cannot predict the nature, scope or effect of future regulatory requirements to which our international operations might be subject or the manner in which existing or future laws might be administered or interpreted.

export control regulations, economic sanctions on countries and persons, anti-money laundering laws, customs requirements and currency exchange regulations, collectively referred to as trade control laws.

We are also subject to other laws and regulations governing our international operations, including regulations administered by the governments of the United States and authorities in the European Union, including applicable import and export control regulations, economic sanctions on countries and persons, anti-money laundering laws, customs requirements and currency exchange regulations, collectively referred to as trade control laws.

We may not be effective in ensuring our compliance with all applicable anti-corruption laws or other legal requirements, including trade control laws.

6 unchanged sentences

We operate in a highly regulated industry and new laws, regulations, judicial decisions, or new interpretations of existing laws, regulations or decisions, related to healthcare availability, the method of delivery of, or payment for, healthcare products and services could negatively impact our business, financial condition, results of operations and prospects.

There continues to be significant interest in promoting healthcare reform, as evidenced by the enactment in the United States of the Affordable Care Act and efforts to repeal, invalidate or modify portions of the act.

There continues to be significant interest in promoting healthcare reform, as evidenced by the enactment in the United States of the Affordable Care Act and repeated efforts to repeal, invalidate or modify portions of the act.

Among other things, the Affordable Care Act contains provisions that may reduce the profitability of drug products, including, for example, revising the methodology by which rebates owed by manufacturers for covered outpatient drugs under the Medicaid Drug Rebate Program are calculated, extending Medicaid rebates to individuals enrolled in Medicaid managed care plans, imposing mandatory discounts for certain Medicare Part D beneficiaries who fall into a coverage gap, and subjecting drug manufacturers to payment of an annual fee based on its market share of prior year total sales of branded products to certain federal healthcare programs.

There have been judicial and congressional challenges to the Affordable Care Act, some of which have been successful, as well as efforts to repeal or replace certain aspects of the Affordable Care Act.

With Republicans now controlling the House of Representatives, the Senate and the Presidency, some commentators believe that significant changes to, or repeal of, the Affordable Care Act is more likely.

If a new law is enacted, or if the Affordable Care Act is overturned, repealed or modified, in whole or in part, by judicial or legislative action, many if not all of the provisions of the Affordable Care Act may no longer apply to prescription drugs.

5 unchanged sentences

On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, also reduced Medicare payments to several categories of healthcare providers.

The Biden administration and Congress may announce initiatives intended to result in lower drug prices.

We are not in a position to know at this time whether such initiatives will become law or what impact they may potentially have on our business.

We expect that additional healthcare reform measures and drug pricing regulations that may be adopted in the future may result in more rigorous coverage criteria and in additional downward pressure on the revenue that we may potentially receive for any approved product.

29 unchanged sentences

However, there is often significant competition for these contracts or grants.

Entities offering contracts or grants may have requirements to apply for, or to otherwise be eligible for, certain contracts or grants that our competitors may be able to satisfy that we cannot satisfy.

In addition, such entities may make arbitrary decisions as to whether to offer contracts or make grants, to whom the contracts or grants may or will be awarded and the conditions and size of the contracts or grants to each awardee.

22 unchanged sentences

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

If any such actions are instituted against us, and we are not successful in defending or asserting our rights, those actions could have a significant impact on our business, including the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgement, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future earnings and curtailment or restructuring of our operations, any of which could adversely affect our ability to operate.

Even if we are ultimately successful in defending any such actions, we could be required to divert financial and managerial resources to such action and adverse publicity could result, all of which could harm our business.

If any such actions are instituted against us, and we are not successful in defending or asserting our rights, those actions could have a significant negative impact on our business, including the imposition of significant civil, criminal and

administrative penalties, damages, monetary fines, disgorgement, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future earnings and curtailment or restructuring of our operations, any of which could adversely affect our ability to operate.

Even if we are ultimately successful in defending any such actions, we could be required to divert significant financial and managerial resources to such action and adverse publicity could result, all of which could harm our business.

We will need to expand our organization and we may experience difficulties in managing this growth, which could disrupt our operations.

2 unchanged sentences

Our management may need to divert a disproportionate amount of its attention away from our day-to-day activities and devote a substantial amount of time to managing our growth.

As we advance our product candidates through clinical trials, we will need to expand our development, regulatory, manufacturing, marketing and sales capabilities or contract with third parties to provide these

capabilities.

As our operations expand, we expect that we will need to manage additional relationships with such third parties, as well as additional collaborators and suppliers.

14 unchanged sentences

We do not believe any confidential or proprietary information was compromised and have taken steps to prevent unauthorized action in the future such as implementing two factor authentication for our email accounts.

As a result of a new SEC rule on cybersecurity disclosure, we are required to disclose, on a current basis pursuant to new Item 1.05 of SEC Form 8-K, any cybersecurity incident that we determine to be material and describe the material aspects of the nature, scope, and timing of the incident, as well as the material impact or reasonably likely material impact of the incident on us, including our financial condition and results of operations.

We will also be required to describe, on a periodic basis, our processes, if any, for the assessment, identification, and management of material risks from cybersecurity threats, and describe whether any risks from cybersecurity threats have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition, our board’s oversight of risks from cybersecurity threats and management’s role in assessing and managing material risks from cybersecurity threats.

We are required to disclose, on a current basis pursuant to new Item 1.05 of SEC Form 8-K, any cybersecurity incident that we determine to be material and describe the material aspects of the nature, scope, and timing of the incident, as well as the material impact or reasonably likely material impact of the incident on us, including our financial condition and results of operations.

We are also required to describe, on a periodic basis, our processes, if any, for the assessment, identification, and management of material risks from cybersecurity threats, and describe whether any risks from cybersecurity threats have

materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition, our board’s oversight of risks from cybersecurity threats and management’s role in assessing and managing material risks from cybersecurity threats.

While we believe that our insurance policies include liability coverage for security breaches, we could be subject to liability, indemnity claims or other damages that exceed, or are outside the scope of, our insurance coverage.

2 unchanged sentences

Even if we obtain the required regulatory approvals in the United States and other territories, the commercial success of our product candidates will depend on market awareness and acceptance of our product candidates.

Even if we obtain marketing approval for our current product candidates or any other product candidates that we may develop or acquire in the future, our products may not gain market acceptance among physicians, key opinion leaders, healthcare payors, patients and the medical community.

Even if we obtain marketing approval for any of our current product candidates or any other product candidates that we may develop or acquire in the future, our products may not gain market acceptance among physicians, key opinion leaders, healthcare payors, patients and the medical community.

Market acceptance of any approved products depends on a number of factors, including:

16 unchanged sentences

We have never commercialized a product candidate, and we currently have no marketing and sales organization.

To the extent our product candidates are approved for marketing, if we are unable to establish marketing and sales capabilities or enter into agreements with third parties to effectively market and sell our product candidates, we may not be able to successfully market and sell our product candidates or generate product revenue.

In addition, we currently do not have marketing, sales or distribution capabilities for our product candidates.

We have never commercialized a product candidate, and we currently have no marketing, sales or distribution capabilities for our product candidates.

In order to commercialize any of our products that receive marketing approval, we would have to build marketing, sales, distribution, managerial and other non-technical capabilities or make arrangements with third parties to perform these services, and we may not be successful in doing so.

35 unchanged sentences

Outside the United States, international operations are generally subject to extensive governmental price controls and other price-restrictive regulations, and we believe the increasing emphasis on cost-containment initiatives in Europe, Canada and other countries has and will continue to put pressure on the pricing and usage of products.

In many countries, the prices of products are subject to varying price control mechanisms as part of national health systems.

In many countries, the prices of

products are subject to varying price control mechanisms as part of national health systems.

Price controls or other changes in pricing regulation could restrict the amount that we may be able to charge for any of our products.

1 unchanged sentence

Moreover, increasing efforts by governmental and private payors in the United States and other jurisdictions to limit or reduce healthcare costs may result in restrictions on coverage and the level of reimbursement for new products and, as a result, they may not cover or provide adequate payment for our products.

We expect to experience pricing pressures in connection

with products due to the increasing trend toward managed healthcare, including the increasing influence of health maintenance organizations, pharmacy benefit management organizations and additional legislative changes.

We expect to experience pricing pressures in connection with products due to the increasing trend toward managed healthcare, including the increasing influence of health maintenance organizations, pharmacy benefit management organizations and additional legislative changes.

The downward pressure on healthcare costs in general, and prescription drugs in particular, has and is expected to continue to increase in the future.

4 unchanged sentences

We face competition from major pharmaceutical companies, specialty pharmaceutical companies, biotechnology companies, universities and other research institutions worldwide with respect to our product candidates that we may seek to develop or commercialize in the future.

Many of our competitors have materially greater name recognition and financial, manufacturing, marketing, research and drug development resources than we do.

Many of our competitors have materially greater name recognition and financial, manufacturing, marketing, research and drug development resources and experience than we do.

Additional mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated in our competitors.

2 unchanged sentences

These organizations may also establish exclusive collaborative or licensing relationships with our competitors.

In particular, the field of inflammatory bowel disease, including ulcerative colitis and Crohn’s disease, are highly competitive.

In particular, the fields of Multiple Sclerosis, inflammatory bowel disease, including ulcerative colitis and Crohn’s disease, are highly competitive.

Our competitors in the United States and elsewhere include major pharmaceutical, biotechnology and biosimilar manufacturers.

6 unchanged sentences

Failure of any approved product candidates of ours to effectively compete against established treatment options or to compete in the future with new products currently in development would harm our business, financial condition, results of operations and prospects.

The size of the potential market for our product candidates is difficult to estimate and, if any of our assumptions are inaccurate, the actual markets for our product candidates may be smaller than our estimates.

The potential market opportunities for our product candidates are difficult to estimate and will depend on a number of factors beyond our control.

Our estimates of potential market opportunities are predicated on many assumptions, which may include industry knowledge and publications, third-party research reports, and other surveys.

Although we believe that our internal assumptions are reasonable based on currently available information, these assumptions involve the exercise of significant judgment on the part of our management, are inherently uncertain, and their reasonableness has not been assessed by an independent source.

Our estimates of potential market opportunities are predicated on many assumptions, which may include industry knowledge and publications, third-party research reports, and other surveys, and our internal analyses of this information.

If any of the assumptions proves to be inaccurate, the actual markets for our product candidates could be substantially smaller than our estimates.

3 unchanged sentences

These events could also result in the suspension, discontinuation, or clinical hold of, or modifications to, our clinical trials.

Our product candidates may not be accepted by the general public or the medical community and potential

clinical trial subjects may be discouraged from enrolling in our clinical trials.

Our product candidates may not be accepted by the general public or the medical community and potential clinical trial subjects may be discouraged from enrolling in our clinical trials.

As a result, we may not be able to continue, or may be delayed in conducting, our development programs.

22 unchanged sentences

If our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of the FDA, the FDA may refuse to approve our NDA.

If the FDA does not approve our NDA because of concerns about the manufacture of our product candidates, or if significant manufacturing issues arise in the future, we may need to find alternative manufacturing facilities, which would significantly delay and adversely impact our ability to develop our product candidates, obtain marketing approval of our NDA or to continue to market any approved product candidates.

If the FDA does not approve our NDA because of concerns about the manufacture of our product candidates, or if significant manufacturing issues arise in the future, we may need to find alternative manufacturing facilities, which could increase our costs and would significantly delay and adversely impact our ability to develop our product candidates, obtain marketing approval of our NDA or to continue to market any approved product candidates.

Although we are ultimately responsible for ensuring compliance with these regulatory requirements, we do not have day-to-day control over a contract manufacturing organization’s ("CMO"), or other third-party manufacturer’s compliance with applicable laws and regulations, including cGMPs and other laws and regulations, such as those related to environmental, health and safety matters.

2 unchanged sentences

They may also refuse to work with us because of their own financial difficulties, business priorities or other reasons, at a time that is costly or otherwise inconvenient for us.

If we was unable to find adequate replacement or another acceptable solution in time, our clinical trials could be delayed or our commercial activities could be harmed.

If we were unable to find adequate replacement or another acceptable solution in time, our clinical trials could be delayed or our commercial activities could be harmed.

Problems with the quality of the work performed by third parties may lead us to seek to terminate our working relationships and seek alternative service providers.

19 unchanged sentences

We or the third parties we rely on may encounter problems in clinical trials that may cause us or the FDA or foreign regulatory agencies to delay, suspend or terminate our clinical trials at any phase.

These problems could include the possibility that we may not be able to manufacture sufficient quantities of materials for use in our clinical trials, conduct clinical trials at our preferred sites, enroll a sufficient number of patients for our clinical trials at one or more sites, or begin or successfully complete clinical trials in a timely fashion, if at all.

These problems could include the possibility that we, or our contract manufacturers, may not be able to manufacture sufficient quantities of materials for use in our clinical trials, conduct clinical trials at our preferred sites, enroll a sufficient number of patients for our clinical trials at one or more sites, or begin or successfully complete clinical trials in a timely fashion, if at all.

Furthermore, we, the FDA or foreign regulatory agencies may suspend clinical trials of our product candidates at any time if we or they believe the subjects participating in the trials are being exposed to unacceptable health risks, whether as a result of adverse events occurring in our trials or otherwise, or if we or they find deficiencies in the clinical trial process or conduct of the investigation.

1 unchanged sentence

Our failure to adequately demonstrate the safety and efficacy of a product candidate in clinical development could delay or prevent marketing approval of the product candidate.

Even if market approval has already been obtained, adverse data from post-approval studies could result in the product being withdrawn from the market.

Even if marketing approval has already been obtained, adverse

data from post-approval studies could result in the product being withdrawn from the market.

Any of these occurrences would likely have a material adverse effect on our business.

2 unchanged sentences

Collaborations pose a number of risks, including:

• collaborators often have significant discretion in determining the extent of efforts and resources that they will apply to the collaboration, and may not commit sufficient attention and financial or other resources to the development, marketing or commercialization of the product or products that are subject to the collaboration;

• collaborators may not perform their obligations as expected;

6 unchanged sentences

• collaborations may be terminated, which may require us to raise additional capital to pursue further development or commercialization of the applicable product candidate.

As a result of any of these factors, a collaboration may not result in the successful development or commercialization of our product candidates.

As a result of any of these factors, any collaboration we may enter into may not result in the successful development or commercialization of our product candidates.

We enter into various contracts in the normal course of our business in which we indemnify the other party to the contract.

In the event we have to perform under these indemnification provisions, it could have a material adverse effect on our business, financial condition and results of operations.

In the normal course of business, we periodically enter into academic, commercial, service, collaboration, licensing, consulting, financial advisory and other agreements that contain indemnification provisions.

In the normal course of business, we periodically enter into academic, commercial, service, collaboration, licensing, consulting, financial advisory, clinical trial and other agreements that contain indemnification provisions.

With respect to our academic and other research agreements, we typically indemnify the institution and related parties from losses arising from claims relating to the products, processes or services made, used, sold or performed pursuant to the agreements for which we have secured licenses, and from claims arising from our or our sublicensees’ exercise of rights under the agreements.

2 unchanged sentences

If our contract manufacturers fail to comply with continuing regulations, resulting enforcement action could adversely affect us.

If any of our contract manufacturers fail to comply with regulatory requirements or if previously unknown problems with products, manufacturers or manufacturing processes are discovered, we or the manufacturer could be subject to administrative or judicially imposed sanctions, including restrictions on the products or the manufacturers or manufacturing processes we use, warning letters, untitled letters (which the FDA uses as an initial notification of violations), civil or criminal penalties, fines, injunctions, product seizures or detentions, import bans, voluntary or mandatory product recalls and publicity requirements,

suspension or withdrawal of regulatory approvals, total or partial suspension of production, and refusal to approve pending applications for marketing approval of new products.

Risks Related to Our Intellectual Property

7 unchanged sentences

However, we may fail to apply for patents on important technologies or product candidates in a timely fashion, or at all.

Our existing patents and any future patents we obtain may not be sufficiently broad to prevent others from using our technologies or developing competing products and technologies.

Our existing patents and any future patents we obtain may not be sufficiently broad to protect our technologies or prevent others from using our technologies or developing competing products and technologies.

We cannot be certain that our patent applications will be approved or that any patents issued will adequately protect our intellectual property.

14 unchanged sentences

Our ability to maintain and solidify our proprietary rights to our product candidates and future products will depend on our success in obtaining effective claims and enforcing those claims once granted.

Our issued patents and those that may issue in the future, or those licensed to us, may be challenged, narrowed, invalidated or circumvented, and the rights granted under any issued patents may not provide us with proprietary protection or competitive advantages against competitors with similar products.

competitive advantages against competitors with similar products.

Due to the extensive amount of time required for the development, testing and regulatory review of a product candidate, it is possible that, before any of our product candidates can be commercialized, any related patent may expire or remain in force for only a short period following commercialization, thereby reducing any advantage of the patent.

29 unchanged sentences

The Hatch-Waxman Act allows extension of a maximum of one patent per FDA-approved product.

Patent term extension or special protection certificates also may be available in certain foreign countries

upon regulatory approval of our product candidates.

Patent term extension or special protection certificates also may be available in certain foreign countries upon regulatory approval of our product candidates.

Nevertheless, we may not be granted patent term extension either in the United States or in any foreign country because of, among other things, failing to apply prior to applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements.

17 unchanged sentences

The patents for our product candidates have, and any patents issued in the future will have, varying expiration dates and, when these patents expire, we may be subject to increased competition and we may not be able to recover our development costs or market any of our approved products profitably.

In some of the larger potential markets, such as the United States and Europe, patent term extension or restoration may be available to compensate for time taken during aspects of the product’s development and regulatory review.

In some of the larger potential markets, such as the United States and Europe, patent term extension or restoration may be available to compensate for time taken during aspects of the product’s

development and regulatory review.

However, extensions might not be granted or, if granted, the applicable time period or the scope of patent protection afforded during any extension period could be inadequate.

In addition, even though some regulatory authorities may provide some other exclusivity for a product under their own laws and regulations, we may not be able to qualify the product or obtain exclusivity.

If we are unable to obtain patent term extension, restoration or some other exclusivity, we could be subject to increased competition and our opportunity to establish or maintain product revenue could be

substantially reduced or eliminated.

Furthermore, we may not have sufficient time to recover our development costs prior to the expiration of our U.S.

26 unchanged sentences

Third parties may assert that we are employing their proprietary technology without authorization.

We may be unaware of third-party patents or patent applications with claims to materials, formulations, methods of manufacture or methods for treatment related to the use or manufacture of our product candidates.

We may be unaware of third-party patents or patent applications with claims to materials, formulations, methods of manufacture or methods for

treatment related to the use or manufacture of our product candidates.

For example, applications filed before November 29, 2000, and certain applications filed after that date that will not be filed outside the United States, remain confidential until issued as patents.

1 unchanged sentence

Therefore, patent applications covering our product candidates may have been filed by others without the knowledge of us or our licensors.

Additionally,

pending patent applications which have been published can, subject to certain limitations, be later amended in a manner that could cover our product candidates or the use or manufacture of our product candidates.

Additionally, pending patent applications which have been published can, subject to certain limitations, be later amended in a manner that could cover our product candidates or the use or manufacture of our product candidates.

We may also face misappropriation claims if a third party believes that we inappropriately obtained and used its trade secrets.

28 unchanged sentences

A third party that files a patent application in the USPTO after that date, but before we or our licensor files a patent application, could therefore be awarded a patent covering an invention of ours even if we or our licensor had made the invention before the third party.

This will require us to be cognizant going forward of the time

from invention to filing of a patent application.

This will require us to be cognizant going forward of the time from invention to filing of a patent application.

Furthermore, our ability to obtain and maintain valid and enforceable patent rights depends on whether the differences between the licensors or our technology and the prior art allow our technology to be patentable over the prior art.

13 unchanged sentences

The following examples are illustrative:

• Others may be able to make products that are similar to our product candidates but that are not covered by the claims of the patents that we license from others or may license or own in the future.

• Others may be able to make products that are similar to our product candidates but that are not covered by the claims of the patents that we own or license from others or may license or own in the future.

• Others may independently develop similar or alternative technologies or otherwise circumvent any of our technologies without infringing our intellectual property rights.

9 unchanged sentences

However, current or former employees, consultants, contractors and advisers may unintentionally or willfully disclose our confidential information to competitors, and confidentiality agreements may not provide an adequate remedy in the event of unauthorized disclosure of confidential information.

Enforcing a claim that a third

party obtained illegally and is using trade secrets and/or confidential know-how is challenging, expensive, time-consuming and unpredictable.

Enforcing a claim that a third party obtained illegally and is using trade secrets and/or confidential know-how is challenging, expensive, time-consuming and unpredictable.

The extent to which confidentiality agreements may be enforced does vary from jurisdiction to jurisdiction.

26 unchanged sentences

We seek to protect our proprietary technology in part by entering into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with our advisors, employees, third-party contractors and consultants prior to beginning research or disclosing proprietary information.

These agreements are intended to limit the rights of the third parties to use, disclose or publish our confidential information, including our trade secrets.

These agreements are intended to limit the rights of the third parties to use, disclose or publish our confidential information, including our trade secrets, but may be difficult or costly to enforce.

Despite these contractual restrictions, the need to share trade secrets and other confidential information increases the risk that such trade secrets could become known to our competitors, could be inadvertently incorporated into the technology of others, or could be disclosed or used in violation of these agreements.

that our proprietary position is based, in part, on our know-how and trade secrets, a competitor’s discovery of our trade secrets or other unauthorized use or disclosure would impair our competitive position and may have a material adverse effect on our business.

Given that our proprietary position is based, in part, on our know-how and trade secrets, a competitor’s discovery of our trade secrets or other unauthorized use or disclosure would impair our competitive position and may have a material adverse effect on our business.

In the future we may also conduct joint research and development programs that may require us to share trade secrets under the terms of our research and development or similar agreements.

13 unchanged sentences

We also incur costs associated with corporate governance requirements, including requirements under the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), as well as existing and new rules implemented by the SEC and The Nasdaq Stock Market ("Nasdaq").

These rules and regulations increase the company’s legal and financial compliance costs and make some activities more time-consuming and costly.

These rules and regulations require additional attention from management, increase the company’s legal and financial compliance costs and our expenses associated with investor relations activities, among others, and make some activities more time-consuming and costly.

Not all members of our management have previously managed and operated a public company.

2 unchanged sentences

As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as executive officers of our company, which may adversely affect investor confidence in us and could cause our business and stock price to suffer.

Effective December 31, 2019, we are no longer an “emerging growth company,” and the reduced disclosure requirements applicable to “emerging growth companies” no longer apply, and we are required to report on internal control over financial reporting, which has increased our costs as a public company and increased the demands on management.

Effective December 31, 2019, the fiscal year-end following the fifth anniversary of the completion of our initial public offering, we are no longer an “emerging growth company” as defined in the Jumpstart Our Business Startups Act.

As a result, we are incurring significant additional expenses in complying with certain provisions of the Sarbanes-Oxley Act and rules implemented by the SEC.

Moreover, if we or our independent registered public accounting firm identifies deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline, and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.

We are required to report on internal control over financial reporting, which has increased our costs as a public company and increased the demands on management.

Since we are no longer classified as an “emerging growth company,” we are incurring significant additional expenses in complying with certain provisions of the Sarbanes-Oxley Act and rules implemented by the SEC, including requirements to

evaluate and report on internal control over financial reporting.

If we or our independent registered public accounting firm identifies deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline, and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.

Furthermore, investor perceptions of us may suffer if, in the future, material weaknesses are found, and this could cause a decline in the market price of our stock.

Any failure of our internal control over financial reporting could have a material adverse effect on the company’s stated operating results and harm our reputation.

If we are unable to implement these changes effectively or efficiently, it could harm our operations, financial reporting and

financial results and could result in an adverse opinion on internal control from our independent registered public accounting firm.

In addition, we are no longer eligible for reduced disclosure requirements applicable to emerging growth companies regarding executive compensation and exemptions from the requirements of holding advisory say-on-pay votes on executive compensation.

These increased disclosure requirements require additional attention from management and increased costs to the company, including higher legal fees, accounting fees and fees associated with investor relations activities, among others.

Any failure of our internal control over financial reporting could have a material adverse effect on our stated operating results and harm our reputation.

If we are unable to implement and maintain effective internal control over financial reporting, it could harm our operations, financial reporting and financial results and could result in an adverse opinion on internal control from our independent registered public accounting firm.

Risks Related to Our Common Stock

Our failure to meet the $1.00 minimum bid price or other continued listing requirements of Nasdaq could result in a delisting of our common stock, which could negatively impact the market price and liquidity of our common stock and our ability to access the capital markets.

Any Nasdaq action relating to a delisting could have a negative effect on the price of our common stock, impair the ability to sell or purchase our common stock when persons wish to do so, and any such delisting action may materially adversely affect our ability to raise capital or pursue strategic restructuring, refinancing or other transactions on acceptable terms, or at all.

Our failure to meet the $1.00 minimum bid price or other continued listing requirements of Nasdaq could result in a delisting of our common stock, which would negatively impact the market price and liquidity of our common stock and our ability to access the capital markets.

Any Nasdaq action relating to a delisting would have a negative effect on the price of our common stock, impair the ability to sell or purchase our common stock when persons wish to do so, and any such delisting action would materially adversely affect our ability to raise capital or pursue strategic restructuring, refinancing or other transactions on acceptable terms, or at all.

Delisting from the Nasdaq Global Select Market could also have other negative results, including the potential loss of institutional investor interest, reduced coverage by equity research analysts and fewer business development opportunities.

23 unchanged sentences

• general market or macroeconomic conditions;

• sales of common stock by the company or our stockholders in the future;

• sales (or expected sales) of common stock by the company or our stockholders in the future;

• trading volume of our common stock;

8 unchanged sentences

Such litigation, if instituted, could result in substantial costs and diversion of management attention and resources, which could significantly harm our profitability and reputation.

If our stockholders do not approve an increase in the number of authorized shares of our common stock, our ability to raise additional capital to fund our operations and to incentivize our employees will be extremely limited.

We currently have 130,000,000 shares of common stock authorized for issuance and a total of 89,929,016 shares issued and outstanding as of January 31, 2024.

We have asked our stockholders to approve an amendment to our certificate of incorporation to increase our authorized shares of common stock to 500,000,000 shares, at a Special Meeting of Stockholders to be held on March 4, 2024.

The Securities Purchase Agreement with investors in our January 4, 2024 private placement requires us to submit this proposal to our stockholders for approval at the Special Meeting and, if not approved, to resubmit this proposal to stockholders for approval at least semi-annually until approval is obtained.

If holders of a majority of the total outstanding shares of our common stock do not vote in favor of this proposal at the Special Meeting on March 4, 2024, our ability to raise additional equity financing will be severely limited, which will impair our ability to fund the future needs of our business, unless and until we are able to generate sufficient revenue from operations.

Anti-takeover provisions in our organizational documents and Delaware law might discourage or delay acquisition attempts for the company that stockholders might consider favorable.

6 unchanged sentences

• establish that our board of directors is divided into three classes, Class I, Class II and Class III, with each class serving staggered terms.

Further, as a Delaware corporation, we are subject to provisions of Delaware corporations law, which may impair a takeover attempt that our stockholders may find beneficial.

Further, as a Delaware corporation, we are subject to provisions of Delaware corporation law, which may impair a takeover attempt that our stockholders may find beneficial.

These anti-takeover provisions and other provisions under Delaware law could discourage, delay or prevent a transaction involving a change in control of our company, including actions that our stockholders may deem advantageous, or could negatively affect the trading price of our common stock.

These provisions could

also discourage proxy contests and make it more difficult for stockholders to elect directors of their choosing and to cause us to take other corporate actions they desire.

These provisions could also discourage proxy contests and make it more difficult for stockholders to elect directors of their choosing and to cause us to take other corporate actions they desire.

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

We expect that significant additional capital may be needed in the future to continue our planned operations, including conducting clinical trials, commercialization efforts, expanded research and development activities and costs associated with

operating as a public company.

To raise capital, we may sell common stock, convertible securities or other equity securities in one or more transactions at prices and in a manner it determines from time to time.

We may also sell our common stock as part of entering into strategic alliances, creating joint ventures or collaborations or entering into additional licensing arrangements with third parties that we believe will complement or augment our development and commercialization efforts.

If we raise additional funds through further issuances of equity or convertible debt securities, our existing stockholders could suffer dilution, and any new equity securities we issue could have rights, preferences, and privileges superior to those of holders of our common stock.

Any debt financing secured by us in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters.

In addition, we may not be able to obtain additional financing on terms favorable to us, if at all.

If we are unable to obtain adequate financing or financing on terms satisfactory to us, when we require it, our ability to continue to support our business growth and to respond to business challenges could be significantly limited.

For example, in connection with the second and third tranches under the January 2024 Financing, we may issue up to an additional $160 million of common stock, which could represent the issuance of up to approximately 93.2 million shares of common stock.

In addition, on May 2, 2022, we entered into an at-the-market sales agreement (the “Sales Agreement”) with Leerink Partners LLC (“Leerink Partners”), which provides that we may offer and sell from time to time through Leerink Partners as sales agent, up to $80 million of common stock.

As of the date hereof, we have not offered or sold any shares of common stock pursuant to the Sales Agreement.

We may experience adverse consequences because of required indemnification of officers and directors.

4 unchanged sentences

The current expectation is that we will retain any future earnings to fund the development and growth of our business.

As a result, any capital appreciation of the common stock of the company will be stockholders’ sole source of any gain for the foreseeable future.

General Risk Factors

If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired.

We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and Nasdaq rules and regulations.

The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting.

Effective internal control over financial reporting is necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, is designed to prevent fraud.

We must perform system and process evaluation and testing of our internal controls over financial reporting to allow management to report on the effectiveness of our internal controls over financial reporting in our Annual Report on Form 10-K for each year, as required by Section 404 of the Sarbanes-Oxley Act ("Section 404").

This requires significant management efforts and requires us to incur substantial professional fees and internal costs to expand our accounting and finance functions.

Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our reporting obligations.

In addition, any testing by us, as and when required, conducted in connection with Section 404, or any subsequent testing by our independent registered public accounting firm, as and when required, may reveal deficiencies in our internal controls over financial reporting that are deemed to be significant deficiencies or material weaknesses or that may require prospective or retroactive changes to our financial statements, or may identify other areas for further attention or improvement.

Furthermore, we cannot be certain that our efforts will be sufficient to remediate or prevent future material weaknesses or significant deficiencies from occurring.

If we are not able to comply with the requirements of Section 404, or if we are unable to maintain proper and effective internal controls, we may not be able to produce timely and accurate financial statements.

If that were to happen, the market price of our common stock would likely decline and we could be subject to sanctions or investigations by Nasdaq, the SEC, or other regulatory authorities.

Our business and stock price could be negatively affected as a result of actions of activist stockholders, and such activism could impact the trading value of our securities.

As a result, any capital appreciation of our common stock will be stockholders’ sole source of any gain for the foreseeable future.

Our business and stock price could be negatively affected as a result of actions of activist stockholders, and such activism could negatively impact the trading value of our securities.

Stockholders may, from time to time, engage in proxy solicitations or put forth stockholder proposals, or otherwise attempt to effect changes and assert influence on our board of directors and management.

1 unchanged sentence

A proxy contest would require us to incur significant legal and advisory fees, proxy solicitation expenses and administrative and associated costs and require significant time and attention by our board of directors and management, diverting their attention from the pursuit of our business strategy.

Any perceived uncertainties as to our future direction and control, our ability to execute on our strategy, or changes to the composition of our board of directors or management team arising from a proxy contest or initiatives of activist stockholders could lead to the perception of a change in the direction of our business or instability, which may result in the loss of potential business opportunities, make it more difficult to pursue strategic initiatives, or limit our ability to attract and retain qualified

personnel and business partners, any of which could adversely affect our business and operating results and the trading price of our stock.

If individuals are ultimately elected to our board of directors with a specific agenda, our ability to effectively implement our business strategy and create additional value for our stockholders may be adversely effected.

12 unchanged sentences

If one or more equity research analysts ceases coverage of us or fails to publish reports on us regularly, demand for our common stock could decrease, which in turn could cause our stock price and trading volume to decline.

General Risk Factors

If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired.

We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and Nasdaq rules and regulations.

The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting.

This requires significant management efforts and requires us to incur substantial professional fees and internal costs to expand our accounting and finance functions.

Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our reporting obligations.

Furthermore, we cannot be certain that our efforts will be sufficient to remediate or prevent future material weaknesses or significant deficiencies from occurring.

If that were to happen, the market price of our common stock would likely decline and we could be subject to sanctions or investigations by Nasdaq, the SEC, or other regulatory authorities.

If we become profitable, our ability to use our net operating loss carryforwards and other tax attributes to offset future taxable income or taxes may be subject to limitations.

1 unchanged sentence

If we become profitable in the future, our ability to use net operating loss carryforwards, or NOLs, and other tax attributes to offset future taxable income or reduce taxes may be subject to limitations.

In general, under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, or the Code, a corporation that undergoes an “ownership change” (generally defined as a greater than 50% cumulative change by value in its equity ownership of certain stockholders over a rolling three-year period) is subject to an annual limitation on its ability to utilize its pre-change NOLs and other tax attributes (including any research and development credit carryforwards).

In general, under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, or the Code, a corporation that undergoes an “ownership change” (generally

defined as a greater than 50% cumulative change by value in its equity ownership of certain stockholders over a rolling three-year period) is subject to an annual limitation on its ability to utilize its pre-change NOLs and other tax attributes (including any research and development credit carryforwards).

Similar provisions of state tax law may also apply to limit the use of our state NOLs and other tax attributes.

6 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.

What changed 10-K

Item 1A. Risk Factors