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You should carefully consider the fuller risk factor disclosure set forth in this Annual Report, in addition to the other information herein, including the section of this report titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and related notes.
−Removed: • Our business could be materially and adversely affected in the future by the effects of disease outbreaks, epidemics and pandemics.
−Removed: • Continued inflation and uncertainty in global economic conditions could negatively affect our business, results of operations and financial condition.
−Removed: • Our clinical trials have been delayed as a result of the ongoing military action by Russia in Ukraine and the continuation of this conflict could have further adverse effects on our business.
−Removed: • We have a limited operating history with our current business plan, have incurred significant losses since 2016, anticipate that we will continue to incur significant and increasing losses for the foreseeable future and may never achieve or maintain profitability.
−Removed: The absence of any commercial sales and our limited operating history make it difficult to assess our future viability.
−Removed: • We currently have no source of product sales revenue and may never earn product revenue or be profitable.
−Removed: • 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.
−Removed: • 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.
−Removed: • The marketing approval processes of the FDA and comparable foreign regulatory authorities are lengthy, time-consuming and inherently unpredictable, and if we are ultimately unable to obtain marketing approval for our product candidates, our business will be substantially harmed.
−Removed: • Clinical drug development involves a lengthy and expensive process with an uncertain outcome.
−Removed: • Clinical failure can occur at any stage of clinical development.
−Removed: 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.
−Removed: The effect of failure or results different than expectations can result in significant market value decline and possible negative financial results or asset impairment.
−Removed: • 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.
−Removed: • We are heavily dependent on the success of our product candidates, which are in the early to late stages of clinical development.
−Removed: We may not be able to generate data for any of our product candidates sufficient to receive regulatory approval in our planned indications, which will be required before they can be commercialized.
−Removed: • Due to our limited resources and access to capital, we must decide to prioritize development of our current product candidates for certain indications and at certain doses.
−Removed: These decisions may prove to have been wrong and may materially adversely affect our business, financial condition, results of operations and prospects.
−Removed: • If we fail to attract and retain key management and scientific personnel, we may be unable to successfully develop or commercialize our product candidates.
−Removed: • 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.
−Removed: • We currently have limited marketing and sales experience.
−Removed: 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.
−Removed: • 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.
−Removed: • 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.
−Removed: • We face substantial competition, which may result in others discovering, developing or commercializing products before, or more successfully than, we do.
−Removed: • 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 substantially smaller than our estimates.
−Removed: • We may be unable to realize the potential benefits of any collaboration that we might enter into in the future.
−Removed: • Our proprietary rights may not adequately protect our technologies and product candidates.
−Removed: • We may not be able to protect our intellectual property rights throughout the world.
−Removed: • Intellectual property rights do not protect against all potential threats to our potential competitive advantage.
−Removed: • We incur significant costs and demands upon management as a result of complying with the laws and regulations affecting public companies.
−Removed: • 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.
−Removed: • The market price of our common stock has been and is expected to continue to be volatile.
−Removed: • We do not anticipate that we will pay any cash dividends in the foreseeable future.
+Added: • We are a clinical-stage company with a limited operating history, have incurred significant losses since 2016, expect to continue to incur losses for the foreseeable future and may never achieve or maintain profitability.
+Added: • We currently have no product sales revenue and may never generate product revenue.
+Added: • We will require substantial additional capital, and our failure to obtain financing when needed on acceptable terms, or at all, could force us to delay, reduce or terminate our development programs or commercialization efforts;
+Added: additional financings may be dilutive and may impose significant restrictions on our operations.
+Added: • Our business and clinical development timelines could be adversely affected by macroeconomic conditions and global events, including inflation, changes in interest rates, tariffs and retaliatory measures, supply chain disruptions, public health crises and geopolitical conflicts, including the ongoing military action involving Russia and Ukraine.
+Added: • Our success depends on the timely and successful development of our product candidates, and clinical development is lengthy, expensive and uncertain;
+Added: clinical failure can occur at any stage and results from earlier studies may not be predictive of later results.
+Added: • Our product candidates may cause undesirable adverse effects or have other characteristics that could delay or prevent regulatory approval, limit labeling, or result in significant negative consequences if approval is obtained.
+Added: • The regulatory approval process is lengthy, time-consuming and inherently unpredictable, and we may be unable to obtain or maintain marketing approval for our product candidates.
+Added: • Even if approved, our ability to successfully commercialize any product candidates will depend on market acceptance, our ability to build or access sales and marketing capabilities, third-party coverage and reimbursement, and our ability to compete effectively.
+Added: • We face significant competition, and the potential market size for our product candidates may be smaller than we estimate.
+Added: • We depend on our ability to attract and retain key personnel and to establish and maintain strategic relationships and collaborations, and we may not realize the anticipated benefits of any such arrangements.
+Added: • Our ability to protect and enforce our intellectual property rights is uncertain, and failure to do so could impair our competitive position.
+Added: • We are subject to the risks and costs of operating as a public company, and our failure to meet Nasdaq continued listing requirements, including the $1.00 minimum bid price requirement, could result in delisting.
+Added: • The market price of our common stock has been and may continue to be volatile, and we do not expect to pay cash dividends in the foreseeable future.
Macroeconomic Risks
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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.
−Removed: 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.
+Added: However, the economies of Germany, the United States, Australia and other countries in which we do business have experienced high rates of inflation in recent years, 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.
A downturn in the economic environment can also lead to limitations on our ability to obtain financing, reduced liquidity and declines in our stock price.
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This military action has continued for more than three years and its future course and effects on our Company are highly unpredictable.
−Removed: 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.
+Added: We currently have approximately 35 active sites in western Ukraine and the ongoing conflict could put the data associated with these patients at risk as well as extend patient recruitment timelines.
Ukraine is expected to make up a significant percentage of our ENSURE- 1 and ENSURE-2 phase 3 patient population.
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However pharmaceutical product development is an extremely costly and highly speculative undertaking and involves a substantial degree of risk.
−Removed: 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
−Removed: 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.
−Removed: 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.
+Added: 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,
+Added: reimbursement from third-party payors, and adequate market share for our product candidates.
+Added: Even if we eventually obtain adequate market share for our product candidates, to the extent they receive regulatory and marketing approval and authorization for reimbursement, the potential markets for our product candidates may not be large enough for us to become profitable.
We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future, and our expenses will increase substantially if and as we:
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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.
+Added: We have approximately $15.5 million of cash and cash equivalents as of December 31, 2025.
+Added: On February 17, 2026 we announced the closing of a private placement with net cash proceeds of $187.0 million.
+Added: With these funds we expect to be able to fund our operations beyond twelve months from the date of the issuance of the accompanying consolidated financial statements.
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.
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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.
−Removed: 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.
−Removed: Our independent registered public accounting firm ’ s report contains an explanatory paragraph that expresses substantial doubt about our ability continue as a “ going concern .
−Removed: 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.
−Removed: LLP of a “going concern” opinion.
−Removed: 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.
−Removed: 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
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In addition, the FDA may not consider any additional information to be complete or sufficient to support the filing or approval of the NDA.
−Removed: Policies and actions of the new administration of President Trump could lead to additional uncertainties and delays in the FDA review and approval processes.
+Added: Policies and actions of the U.S.
+Added: federal government, including changes in leadership, priorities, staffing levels, funding, and regulatory approaches 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.
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Also, marketing approval for any of our product candidates may be withdrawn.
−Removed: 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
−Removed: product candidates will be impaired.
+Added: 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.
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.
+Added: Our most advanced product candidate requires successful completion of Phase 3 clinical trials and additional development activities before regulatory approval may be obtained, and any delays or failures could materially adversely affect our business.
+Added: For our most advanced indication, RMS, marketing approval will depend on the successful completion of one or more adequate and well-controlled Phase 3 clinical trials.
+Added: Phase 3 development is costly and resource-intensive and typically spans multiple years.
+Added: Clinical trials are inherently unpredictable, and studies that are initiated as planned may be delayed, require modification or fail to produce results sufficient to support approval.
+Added: Protocol amendments, safety observations, manufacturing
+Added: constraints, evolving regulatory expectations or inconclusive efficacy data may each effect trial timing or outcomes.
+Added: Additional preclinical and clinical work will also be required to support regulatory submissions.
+Added: Regulatory feedback during development may alter the scope or timing of required studies, which could increase costs or extend development timelines.
+Added: We must also establish manufacturing processes capable of supporting commercial supply.
+Added: This includes scaling production, validating manufacturing methods and implementing controls designed to demonstrate consistent product quality and compliance with applicable regulatory requirements.
+Added: Manufacturing development and validation are complex and may require significant investment and regulatory review.
+Added: Even where clinical results are favorable, difficulties in developing or validating manufacturing capabilities may delay or prevent approval.
+Added: If clinical development, supporting studies or manufacturing readiness activities are delayed or unsuccessful, regulatory approval may be postponed or not obtained, which would limit our ability to commercialize this product candidate and could materially adversely affect our business, financial condition and results of operations.
Clinical drug development involves a lengthy and expensive process with an uncertain outcome.
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Our future clinical trial results also may not be successful.
−Removed: 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.
−Removed: 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.
−Removed: This could delay or eliminate any potential product revenue by delaying or terminating the potential commercialization of our current product candidates.
+Added: 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 changes in regulatory priorities, guidance or review practices.
Our clinical trials are conducted at multiple sites, including some sites in countries outside the United States and the European Union, which may subject us to further delays and expenses as a result of increased shipment costs, additional regulatory requirements and the engagement of foreign and non-European Union contract research organizations ("CROs"), as well as expose us to risks associated with clinical investigators who are unknown to the FDA or European regulatory authorities, and with different standards of diagnosis, screening and medical care.
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The commencement and completion of clinical trials for our current product candidates may be delayed, suspended or terminated as a result of many factors, including but not limited to:
−Removed: • the delay or refusal of regulators or institutional review boards (“IRBs”) at the medical institutions where the clinical trials are conducted.
−Removed: to authorize us to commence a clinical trial at a prospective trial site;
+Added: • the delay or refusal of regulators or institutional review boards (“IRBs”) at the medical institutions where the clinical trials are conducted to authorize us to commence a clinical trial at a prospective trial site;
• changes in regulatory requirements, policies and guidelines;
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• safety or tolerability concerns, which could cause us to suspend or terminate a trial if we find that participants are exposed to unacceptable health risks;
−Removed: • regulators or IRBs requiring that we or our investigators suspend or terminate clinical research for various reasons, including noncompliance with regulatory requirements;
+Added: • regulators or IRBs requiring that we or our investigators suspend or terminate clinical research for various reasons, including noncompliance with regulatory requirements or adverse events experienced by participants in clinical trials;
• 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;
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Clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical or preclinical testing.
−Removed: For example, we announced in October 2022 the analysis of interim group-level data of our Phase 1b clinical trial of IMU-935 in patients with moderate-to-severe psoriasis did not separate from placebo.
+Added: • We announced in October 2022 the analysis of interim group-level data of our Phase 1b clinical trial of IMU-935 in patients with moderate-to-severe psoriasis did not separate from placebo.
Following this announcement, our stock price declined significantly, which caused us to record a full impairment of our goodwill in the quarter ended December 31, 2022.
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As a result, we do not plan any further drug development activities in ulcerative colitis without a partner.
−Removed: A number of companies in the pharmaceutical industry, including those with greater resources and experience than we, have suffered significant setbacks in Phase 2 and Phase 3 clinical trials, even after seeing promising results in earlier clinical trials.
+Added: • In October 2024, an independent data monitoring committee, or IDMC, conducted a non-binding, interim futility analysis of our Phase 3 ENSURE program for the treatment of RMS and reported that the trials are not futile and should continue as planned.
+Added: In addition, the IDMC recommended that we continue the trials without any adjustment to the sample sizes of each trial.
+Added: 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
+Added: analysis and the current sample size of approximately 1,050 adult patients with active RMS in each trial may not be sufficiently large to demonstrate efficacy.
+Added: • In February 2025, we reported that IMU-856, our orally available small molecule modulator targeting SIRT6, demonstrated a dose-dependent increase in endogenous glucagon-like peptide-1 levels in a post-hoc analysis of patients from our Phase 1b clinical trial in celiac disease, and dose-dependent reductions in body weight gain and food consumption in preclinical in vivo testing.
+Added: These data suggest potential effects on GLP-1 and weight management;
+Added: however, such findings arise from a post-hoc analysis of a small Phase 1b study and preclinical models, which are inherently subject to limitations.
+Added: • In April 2025, we announced data from our Phase 2 CALLIPER trial of vidofludimus calcium in patients with progressive multiple sclerosis, including a reported reduction in the relative risk of 24-week confirmed disability worsening events by approximately 20% in the overall PMS population and by approximately 30% in the primary progressive multiple sclerosis subgroup compared to placebo.
+Added: • In June 2025, we reported new, positive long-term open-label extension data from our Phase 2 EMPhASIS trial of vidofludimus calcium for the treatment of relapsing-remitting multiple sclerosis.
+Added: The OLE portion of the EMPhASIS trial is ongoing and is generally designed to evaluate longer-term safety and tolerability and to explore longer-term outcomes;
+Added: however, OLE data are inherently subject to important limitations, including the absence of a concurrent control group, potential selection bias (including that patients who remain in the OLE may differ from those who discontinue participation), and the potential influence of confounding factors.
+Added: Notwithstanding any of the foregoing, many companies in the pharmaceutical industry, including those with greater resources and experience than we, have suffered significant setbacks in Phase 2 and Phase 3 clinical trials, even after seeing promising results in earlier clinical trials.
In some instances, there can be significant variability in safety and/or efficacy results between different trials of the same product candidate due to numerous factors, including differences in trial protocols and design, the size and type of the patient population, adherence to the dosing regimen and the rate of dropout among clinical trial participants.
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.
−Removed: 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.
−Removed: In addition, the IDMC recommended that we continue the trials without any adjustment to the sample sizes of each trial.
−Removed: 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.
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Our future success is dependent on our ability to successfully further develop, obtain regulatory approval for, and commercialize one or more product candidates.
−Removed: We currently generate no revenue from sales of any products, and we may never be able to develop or commercialize a product candidate.
−Removed: Our most advanced product candidate, vidofludimus calcium, had the first patient enrolled in a Phase 3 program for relapsing multiple sclerosis (“RMS”) in November 2021 and we do not expect the readout of topline data from this trial until the middle of 2026.
+Added: We have never generated revenue from sales of any products, and we may never be able to develop or commercialize a product candidate.
+Added: Our most advanced product candidate, vidofludimus calcium, had the first patient enrolled in a Phase 3 program for relapsing multiple sclerosis (“RMS”) in November 2021 and we do not expect the readout of topline data from this trial until the end of 2026.
We are not permitted to market or promote any of our product candidates before we receive regulatory approval from the FDA or comparable foreign regulatory authorities, and we may never receive such regulatory approval for any of our product candidates.
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The specific eligibility criteria of our planned clinical trials may further limit the population of available eligible trial participants.
−Removed: We may not be able to identify, recruit, and enroll a sufficient number of eligible patients to initiate or complete our clinical trials in a timely manner because of the perceived risks and benefits of the product candidate under study, the availability and efficacy of competing therapies and clinical trials, and the willingness of physicians to participate in our planned clinical trials.
+Added: We may not be able to identify, recruit, and enroll a sufficient number of eligible patients to initiate or complete our clinical trials in a timely manner because of the perceived risks and benefits of the product candidate under study, the availability and efficacy of competing therapies and clinical trials, and the willingness of physicians to participate in our
+Added: planned clinical trials.
If patients are unwilling to participate in our clinical trials for any reason, the timeline for conducting trials and obtaining regulatory approval of our product candidates may be delayed.
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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.
−Removed: 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
−Removed: requirements, or evidence of acts that raise questions about the integrity of data supporting the product approval, may result in, among other things:
+Added: 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:
• restrictions on product distribution or use, or requirements to conduct post-marketing studies or clinical trials;
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The FDA’s policies may change and additional government regulations may be enacted that could prevent, limit or delay marketing approval, manufacturing or commercialization of our product candidates.
−Removed: We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or other jurisdictions.
+Added: We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation, executive orders or administrative action, either in the United States or other jurisdictions.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or not able to maintain regulatory compliance, we may lose any marketing approval that may have been obtained and we may not achieve or sustain profitability, which would adversely affect our business.
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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.
−Removed: Generally, unless we perform clinical trials meeting that standard comparing our product candidates to competing
−Removed: 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.
+Added: 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.
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states and foreign jurisdictions in which we conduct business.
−Removed: The applicable federal, state and foreign healthcare laws that may affect our ability to operate include the following:
−Removed: • The federal Anti-Kickback Statute prohibits, among other things, persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward, either the referral of an individual for, or the purchase, lease, order or recommendation of, any good, facility, item or service, for which payment may be made, in whole or in part, under federal and state healthcare programs such as Medicare and Medicaid.
−Removed: Remuneration has been interpreted broadly to include anything of value.
−Removed: Although there are a number of statutory exemptions and regulatory safe harbors protecting certain common activities from prosecution, the exemptions and safe harbors are drawn narrowly, and those activities may be subject to scrutiny or penalty if they do not qualify for an exemption or safe harbor.
−Removed: A conviction for violation of the Anti-Kickback Statute results in mandatory exclusion from participation in federal healthcare programs.
−Removed: This statute has been applied to arrangements between pharmaceutical manufacturers and those in a position to purchase products or refer others including prescribers, patients, purchasers and formulary managers.
−Removed: In addition, the Affordable Care Act amended the Social Security Act to provide that the U.S.
−Removed: government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute also constitutes a false or fraudulent claim for purposes of the federal civil False Claims Act, the penalties for which are described below.
−Removed: • Federal civil and criminal false claims laws and civil monetary penalty laws, including the FCA, impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for, among other things, knowingly presenting, or causing to be presented, to the federal government, including the Medicare and Medicaid programs, claims for payment that are false or fraudulent or for making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government.
−Removed: FCA liability is potentially significant in the healthcare industry because the statute provides for treble damages and mandatory penalties (tied to inflation) of $14,308 to $28,619 (after January 15, 2025) per false claim or statement.
−Removed: • 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.
−Removed: • 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
−Removed: 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.
−Removed: • 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.
−Removed: • The federal Open Payments program, created under the Physician Payment Sunshine Act, also known as Section 6002 of the Patient Protection and Affordable Care Act (the “Affordable Care Act”), and its implementing regulations, impose annual reporting requirements for certain manufacturers of drugs, devices, biologicals and medical supplies for payments and “transfers of value” provided to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.
−Removed: The SUPPORT for Patients and Communities Act expanded the scope of reporting such that companies must also report payments and transfers of value provided to other types of healthcare professionals.
−Removed: Failure to submit timely, accurately and completely the required information for all covered payments, transfers of value and ownership or investment interests may result in civil monetary penalties.
−Removed: • There are many analogous state and foreign laws, such as:
−Removed: state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers;
−Removed: state and foreign laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers;
−Removed: state and foreign laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures;
−Removed: and state and foreign laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.
−Removed: • The Affordable Care Act, among other things, amended the intent requirement of the federal Anti-Kickback Statute and certain criminal statutes governing healthcare fraud.
−Removed: A person or entity no longer needs to have actual knowledge of the statute or specific intent to violate it.
−Removed: Efforts to ensure that our future business arrangements with third parties comply with applicable healthcare laws and regulations may involve substantial costs.
+Added: Further, efforts to ensure that our future business arrangements with third parties comply with applicable healthcare laws and regulations may involve substantial costs.
It is possible that governmental authorities will conclude that our business practices may not comply with current or future statutes, regulations or case law involving applicable fraud and abuse or other healthcare laws.
−Removed: If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to it, we may be subject to significant civil, criminal and administrative penalties, including, without limitation, damages, fines, imprisonment, exclusion from participation in government healthcare programs, such as Medicare and Medicaid, and the curtailment or restructuring of our operations, which could significantly harm our business.
+Added: If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to it, we
+Added: may be subject to significant civil, criminal and administrative penalties, including, without limitation, damages, fines, imprisonment, exclusion from participation in government healthcare programs, such as Medicare and Medicaid, and the curtailment or restructuring of our operations, which could significantly harm our business.
If any of the physicians or other healthcare providers or entities with whom we expect to do business, including current and any future collaborators, are found not to be in compliance with applicable laws, those persons or entities may be subject to criminal, civil or administrative sanctions, including exclusion from participation in government healthcare programs, which could also negatively affect our business.
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Foreign Corrupt Practices Act ("FCPA"), and other anti-corruption laws that apply in countries where we do, or may in the future do, business.
−Removed: The FCPA and these other laws
−Removed: 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.
+Added: 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.
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Our revenue prospects could be affected by changes in healthcare spending and policy in the United States and other jurisdictions.
−Removed: 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.
+Added: We operate in a highly regulated industry and new laws, regulations, judicial decisions, executive orders, 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 repeated efforts to repeal, invalidate or modify portions of the act.
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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.
−Removed: 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.
+Added: With Republicans now controlling the House of Representatives, the Senate and the Presidency, some commentators believe that significant changes to, or repeal of, the
+Added: 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.
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We and our manufacturers and suppliers are subject to laws and regulations governing the use, manufacture, storage, handling, and disposal of these hazardous materials.
−Removed: In some cases, these hazardous materials and various wastes resulting from their use are stored at facilities of ours and our manufacturers, pending their use and disposal.
+Added: In some cases, these hazardous materials and various wastes resulting from their use are or will be stored at facilities of ours and our manufacturers, pending their use and disposal.
We cannot eliminate the risk of contamination, which could cause an interruption of our commercialization efforts, research and development efforts and business operations, or the risk of environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling, and disposal of these materials and specified waste products.
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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.
−Removed: 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
−Removed: 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.
+Added: 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.
−Removed: We currently have approximately 90 employees.
+Added: We currently have 92 employees.
As our development and commercialization plans and strategies develop, we expect to need additional managerial, operational, sales, marketing, financial, legal and other resources.
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Our expected growth could require significant capital expenditures and may divert financial resources from other projects, such as the development of product candidates.
+Added: We may not have the financial resources needed to fund capital expenditures and expansion of our operations.
If our management is unable to effectively manage our growth, our expenses may increase more than expected, our ability to generate and/or grow revenue could be reduced and we may not be able to implement our business strategy.
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In addition, any breach of our computer systems or physical premises could result in a loss of data or compromised data integrity across more than one of our programs in different stages of development.
−Removed: Any such breach, loss, or compromise of clinical trial participant personal data may also subject us to civil fines and penalties or claims for damages, either under the General Data Protection Regulation and relevant member state law in the European Union, other foreign laws, and HIPAA, and other relevant state and federal privacy laws in the United States including the California Consumer Privacy Act.
+Added: Any such breach, loss, or compromise of clinical trial participant
+Added: personal data may also subject us to civil fines and penalties or claims for damages, either under the General Data Protection Regulation and relevant member state law in the European Union, other foreign laws, and HIPAA, and other relevant state and federal privacy laws in the United States including the California Consumer Privacy Act.
To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, including but not limited to information related to our vidofludimus calcium product candidate, we could incur liability, our competitive and reputational position could be harmed, and the further development and commercialization of our investigational medicines could be delayed.
−Removed: On July 31, 2020, we discovered that an email account at the Company was subject to attempted unauthorized access for a period of up to 24 hours and we hired an investigator to ascertain what, if any, Company or patient information was impacted.
−Removed: 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.
−Removed: 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.
−Removed: 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
−Removed: 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.
−Removed: 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.
−Removed: As a result, the ramifications of a potential security breach could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as cause a decline in the trading price of our common stock.
+Added: We are subject to evolving SEC rules and other legal requirements regarding cybersecurity incident reporting and disclosure, and any actual or perceived failure to comply with such requirements could result in regulatory scrutiny, litigation, reputational harm and increased costs.
Risks Related to Commercialization of Our Product Candidates
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We may choose to collaborate with third parties that have their own sales forces and established distribution systems, in lieu of or to augment any sales force and distribution systems we may create.
−Removed: If we are unable to enter into collaborations with third parties for the commercialization of any approved products on acceptable terms or at all, or if any such collaborator does not devote sufficient resources to the commercialization of our product or otherwise fails in commercialization efforts, we may not be able to successfully commercialize our product candidates even if we receive marketing approval.
+Added: If we are unable to enter into collaborations with third parties for the commercialization of any approved products on acceptable terms or at all, or if any such collaborator does not devote sufficient resources to the commercialization of our product or otherwise fails in commercialization efforts, we may not be able to successfully commercialize our product candidates even if we receive
+Added: marketing approval.
If we are not successful in commercializing our product candidates, either on our own or through collaborations with one or more third parties, our future revenue will be materially and adversely impacted.
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Therefore, in addition to financing the development of our product candidates through additional equity financings or through debt financings, we may decide to enter into collaborations with pharmaceutical or biopharmaceutical companies for the development and potential commercialization of our product candidates in the United States or foreign markets.
−Removed: We announced in June 2022 that we do not plan further drug development activities in ulcerative colitis without a partner.
We face significant competition in seeking appropriate collaborators.
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Further, eligibility for coverage does not necessarily signify that a drug will be reimbursed in all cases or at a rate that covers our costs.
−Removed: Thus, even if we succeed in bringing a product to market, it may not be considered medically necessary or cost-effective, and the amount reimbursed for any products may be insufficient to allow us to sell our products on a competitive basis.
+Added: Thus, even if we succeed in bringing a product to market, it may not be considered medically
+Added: necessary or cost-effective, and the amount reimbursed for any products may be insufficient to allow us to sell our products on a competitive basis.
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.
−Removed: In many countries, the prices of
−Removed: products are subject to varying price control mechanisms as part of national health systems.
+Added: 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.
+Added: Tariffs could also adversely affect pricing of our products.
Accordingly, the potential revenue and profits from markets outside the United States may be commercially inadequate.
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Third-party payors, including governmental and private insurers, also may encourage the use of less expensive generic products.
−Removed: 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.
+Added: Failure of any approved product candidates of ours to effectively compete against established treatment options or to compete in the future with new products 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 substantially smaller than our estimates.
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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.
−Removed: 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 for all of the assumptions.
−Removed: If any of the assumptions proves to be inaccurate, the actual markets for our product candidates could be substantially smaller than our estimates.
+Added: Although we believe that our internal assumptions are reasonable based on currently available information, these
+Added: 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 for all of the assumptions.
+Added: If any of the assumptions proves to be inaccurate or any of our analysis turns out to be flawed, the actual markets for our product candidates could be substantially smaller than our estimates.
Negative developments in the field of oral therapies for chronic inflammatory and autoimmune diseases could damage public perception of our product candidates and negatively affect our business.
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Further, the third parties we contract with could have staffing difficulties, might undergo changes in priorities or may become financially distressed, any of which would adversely affect the manufacturing and production of our product candidates.
−Removed: In addition, a third party could be acquired by, or enter into an exclusive arrangement with, one of our competitors, which would adversely affect our ability to access the formulations we require for the manufacturing of our product candidates.
+Added: In addition, a third party could be acquired by, or enter into an exclusive arrangement with, one of our competitors, which would adversely affect our ability to access the formulations we require for the manufacturing of our product candidates and could require us to find and contract with alternative sources of supply, resulting in higher costs and delays in our drug development program.
The facilities used by our current contract manufacturers and any future manufacturers to manufacture our product candidates must be inspected by the FDA after we submit our NDA.
−Removed: We do not control the manufacturing process of, and are completely dependent on, our contract manufacturers for compliance with the regulatory requirements, known as cGMPs, for manufacture of both active drug substances and finished drug products.
+Added: We do not control the manufacturing process of, and are completely dependent on, our contract manufacturers for compliance with the regulatory requirements, known as cGMPs, for
+Added: manufacture of both active drug substances and finished drug products.
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.
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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.
−Removed: 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.
+Added: 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
+Added: 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.
−Removed: Even if marketing approval has already been obtained, adverse
−Removed: data from post-approval studies could result in the product being withdrawn from the market.
+Added: 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.
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• any such collaboration may significantly limit our share of potential future profits from the associated program, and may require us to relinquish potentially valuable rights to our current product candidates, potential product candidates or proprietary technologies, or to grant licenses on terms that are not favorable to us;
−Removed: • collaborators may cease to devote sufficient resources to the development or commercialization of our product candidates, especially if the collaborators view our product candidates as competitive with their own products or product candidates;
• disagreements with collaborators, including disagreements over proprietary rights, contract interpretation or the course of development, might cause delays or termination of the development or commercialization of product candidates, and might result in legal proceedings, which would be time-consuming, distracting and expensive;
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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.
+Added: A prolonged U.S.
+Added: federal government shutdown could materially and adversely affect our business, operations, and legal proceedings.
+Added: On October 1, 2025, the federal government of the United States began a shutdown at 12:01 a.m.
+Added: EDT as a result of congressional failure to pass appropriations legislation for the 2026 fiscal year, which began that day, and lasted for 43 days.
+Added: Subsequent partial federal government shutdowns occurred in January and February of 2026.
+Added: A continued and prolonged shutdown could materially and adversely affect our business, operations, financial condition, and legal matters.
+Added: A federal government shutdown may result in the furlough of federal employees, reduced availability of government services, and suspension or delay of activities by key agencies that regulate, fund, or interact with our business, including the SEC, the FDA, the HHS, and the U.S.
+Added: Patent and Trademark Office.
+Added: During such periods, review and approval of our filings, applications, and submissions could be delayed, and we may be unable to access or rely upon certain government data or systems.
+Added: In addition, the Administrative Office of the U.S.
+Added: Courts and federal judiciary operations rely on appropriated funds and fee-based reserves that may be exhausted in the event of an extended shutdown.
+Added: If federal court funding lapses or is limited to “essential” functions only, civil litigation, bankruptcy proceedings, and regulatory enforcement actions involving us or our affiliates could be postponed or suspended.
+Added: Any such delay could impede our ability to resolve disputes, enforce contractual rights, or obtain timely judicial relief, which may have a material adverse effect on our financial position or prospects.
+Added: Such conditions could negatively impact our access to financing, timing of capital-raising transactions, and the liquidity or trading volume of our securities.
+Added: Accordingly, the current federal government shutdown, or uncertainty regarding the continuity of government operations could have a material adverse effect on our business, results of operations, and stock price.
Risks Related to Our Intellectual Property
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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.
−Removed: 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
−Removed: competitive advantages against competitors with similar products.
+Added: 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.
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.
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Filing, prosecuting and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States can be less extensive than those in the United States.
−Removed: In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States.
+Added: In addition, the laws of some foreign countries do not protect intellectual property rights to the
+Added: same extent as federal and state laws in the United States.
For example, many foreign countries have compulsory licensing laws under which a patent owner must grant licenses to third parties.
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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.
−Removed: 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
−Removed: development and regulatory review.
+Added: 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.
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Third parties may assert that we are employing their proprietary technology without authorization.
−Removed: We may be unaware of third-party patents or patent applications with claims to materials, formulations, methods of manufacture or methods for
−Removed: treatment related to the use or manufacture of our product candidates.
+Added: 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.
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In the event of a successful claim of infringement against us, we may have to pay substantial damages, including treble damages and attorneys’ fees for willful infringement, pay royalties, redesign our infringing products or obtain one or more licenses from third parties, which may be impossible to obtain or require substantial expenditure of time and money.
−Removed: In addition, the uncertainties associated with litigation could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties, or enter into collaborative arrangements that would help us bring our product candidates to market.
+Added: In addition, the uncertainties associated with litigation could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license
+Added: necessary technology from third parties, or enter into collaborative arrangements that would help us bring our product candidates to market.
Changes in U.S.
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Over the long term, if we are unable to successfully register and protect our trademarks and trade names and establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively and our business may be adversely affected.
−Removed: Our efforts to enforce or protect our proprietary rights related to trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources and could adversely impact our financial condition or results of operations.
+Added: Our efforts to enforce or protect our proprietary rights related to
+Added: trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources and could adversely impact our financial condition or results of operations.
Risks Related to Being a Public Company
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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.
−Removed: 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
−Removed: evaluate and report on internal control over financial reporting.
+Added: 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.
3 unchanged sentences
Risks Related to Our Common Stock
−Removed: 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.
+Added: If we fail to regain compliance by June 22, 2026 with the $1.00 minimum bid price requirement of Nasdaq, our common stock will be delisted from the Nasdaq Capital Market (subject to appeal), which would negatively impact the market price and liquidity of our common stock and our ability to access the capital markets.
+Added: We were notified by Nasdaq on June 27, 2025 that our common stock had closed below $1.00 for the previous 30 consecutive business days.
+Added: Therefore, we were not in compliance with Nasdaq Listing Rule 5450(a)(1), also known as the Bid Price Rule.
+Added: We were given a 180-day grace period, until December 24, 2025, to regain compliance with the Bid Price Rule.
+Added: We had not regained compliance with the Bid Price Rule by December 24, 2025.
+Added: Therefore, we filed an application to transfer the listing of our common stock from the Nasdaq Global Select Market to the Nasdaq Capital Market.
+Added: This application to be listed on the Nasdaq Capital Market was approved and we were granted an additional 180-day grace period, or until June 22, 2026, to regain compliance with the Bid Price Rule.
+Added: To regain compliance with the Bid Price Rule and qualify for continued listing on the Nasdaq Capital Market, the minimum bid price per share of common stock must be at least $1.00 for at least 10 consecutive business days on or prior to June 22, 2026.
+Added: If we fail to regain compliance during the additional compliance period, then Nasdaq will notify us of its determination to delist our common stock, at which point we would have an opportunity to appeal the delisting determination to a Nasdaq Listing Qualifications Panel, but there can be no assurance that such an appeal would be granted.
+Added: As a condition of the approval of the application to transfer listing of common stock to the Nasdaq Capital Market., we notified Nasdaq that we would seek to implement a reverse stock split, if necessary, to regain compliance with the Bid Price Rule.
+Added: We have filed a
+Added: preliminary proxy statement with the SEC to convene a special meeting of stockholders to obtain stockholder approval of certain matters related to a reverse stock split, described elsewhere in this annual report on form 10-K as the Reverse Split Stockholder Approval, but there is no guarantee that our stockholders will approve these matters at a special meeting.
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.
−Removed: 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.
−Removed: In the event of any delisting or potential delisting, we may attempt to take actions to restore our compliance with Nasdaq’s listing requirements, such as seeking stockholder approval of a reverse stock split, but we can provide no assurance that any such action taken by us would allow our common stock to remain listed or be re-listed, stabilize the market price or improve the liquidity of our common stock, maintain a minimum closing bid price of $1.00 per share for 10 consecutive trading days as required for continued listing on the Nasdaq Global Select Market pursuant to Nasdaq Listing Rule 5450(a)(1) or prevent future non-compliance with Nasdaq’s listing requirements.
+Added: Delisting from the Nasdaq Capital 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.
+Added: If our stockholders fail to approve a reverse stock split of our common stock, our business and operations will be materially negatively impacted, because we will be unable to issue additional shares of common stock and our common stock may be delisted from The Nasdaq Capital Market .
+Added: As a result of our recent private placement financing and prior equity issuances, we currently have a limited number of authorized but unissued shares of common stock available for future issuance.
+Added: The availability of authorized shares is necessary to provide us with flexibility to pursue financing transactions, strategic acquisitions, equity incentive grants, conversions or exercises of outstanding securities, and other general corporate purposes.
+Added: Because the number of authorized but unissued shares of our common stock is currently limited, we may be unable to issue additional shares of common stock when needed unless and until we obtain the Reverse Split Stockholder Approval.
+Added: We have filed a preliminary proxy statement with the SEC to convene a special meeting of stockholders to obtain stockholder approval of certain matters related to a reverse stock split, described elsewhere in this annual report on form 10-K as the Reverse Split Stockholder Approval, but there is no guarantee that our stockholders will approve these matters at a special meeting.
+Added: If we are unable to obtain the Reverse Split Stockholder Approval, or otherwise increase the number of authorized shares available for issuance on a timely basis, our ability to raise additional capital, satisfy contractual obligations requiring the issuance or reservation of shares, pursue strategic transactions, or provide equity-based compensation could be materially limited.
+Added: Any delay or inability to access equity financing or complete strategic transactions could adversely affect our liquidity, financial condition, and ability to execute our business strategy.
+Added: In addition, uncertainty regarding the availability of authorized shares could negatively impact investor confidence and the market price of our common stock.
+Added: In addition, if we fail to obtain the Reverse Split Stockholder Approval and such failure causes continued noncompliance with the Bid Price Requirement, our common stock will likely be delisted from The Nasdaq Capital Market, which would significantly negatively impact the liquidity of or common stock, as well as our business and results of operations.
+Added: We intend to effect a reverse stock split, which may not achieve its intended objectives and could negatively affect the market price and liquidity of our common stock.
+Added: We also have a significant number of warrants which are either exercisable for shares of common stock now, or will be exercisable for shares of common stock following receipt of the Reverse Split Stockholder Approval, and we are obligated to file a resale registration statement with the SEC to cover a significant number of shares of common stock for resale by certain selling stockholders.
+Added: We have scheduled a special meeting of stockholders to consider a proposal to approve a reverse stock split of our outstanding common stock.
+Added: Approval of the reverse stock split requires stockholder approval, and even if approved, our board of directors will retain discretion as to whether and when to implement the reverse stock split and the ratio at which it would be effected.
+Added: There is no assurance that a reverse stock split, if implemented, will result in a sustained increase in the trading price of our common stock or otherwise achieve the anticipated benefits.
+Added: The market price of our common stock following a reverse stock split will depend on a variety of factors, including our financial and operating performance, general market conditions and investor perceptions, many of which are outside our control.
+Added: In some cases, companies that have effected reverse stock splits have experienced increased price volatility or declines in the market price of their securities after the split becomes effective.
+Added: As a result, our overall market capitalization following a reverse stock split could be lower than before the split.
+Added: A reverse stock split would also reduce the number of shares of our common stock outstanding and could adversely affect trading liquidity.
+Added: Reduced liquidity may make it more difficult for stockholders to buy or sell shares in the market and may contribute to greater fluctuations in the trading price of our common stock.
+Added: In addition, stockholders whose holdings are reduced to fewer than 100 shares as a result of the reverse stock split would hold “odd lots,” which may be more difficult or costly to trade.
+Added: Following our recent private placement and prior equity issuances, we have a limited number of authorized but unissued shares of common stock available for issuance.
+Added: The reverse stock split is intended in part to increase the number of shares available for future financings, strategic transactions, equity incentive awards and other corporate purposes.
+Added: If the reverse stock
+Added: split is not approved or implemented, our ability to raise capital, satisfy obligations that require the issuance or reservation of shares, or pursue strategic opportunities could be limited.
+Added: The announcement or completion of a reverse stock split may also be viewed negatively by investors or the market generally, which could adversely affect the trading price of our common stock.
+Added: Accordingly, even if the reverse stock split is completed, it may not achieve the intended objectives or enhance stockholder value.
+Added: Assuming a 1-for-10 reverse stock split, we would have approximately 13,046,000 shares of common stock issued and outstanding and approximately 32,824,000 shares reserved for issuance upon the exercise of pre-funded warrants and common stock warrants.
+Added: Pursuant to the terms of the February 2026 Registration Rights Agreement, we are obligated to file and have declared effective a resale registration statement to cover all Registrable Securities issued in the February 2026 Offering.
+Added: Although each holder of our warrants is not permitted to convert their warrants into shares of common stock to the extent that after giving effect to such conversion, such holder would (together with such holder’s affiliates and relates parties) beneficially own in excess of 4.99% or 9.99% (at the holder’s election) of the shares of common stock outstanding immediately after giving effect to such exercise, the market price of our common stock could decline if the holders of such shares sell them over time or are perceived by the market as intending to sell them.
The market price of our common stock has been and is expected to continue to be volatile.
44 unchanged sentences
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.
−Removed: 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
−Removed: operating as a public company.
+Added: 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.
4 unchanged sentences
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.
−Removed: 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.
−Removed: 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.
−Removed: As of the date hereof, we have not offered or sold any shares of common stock pursuant to the Sales Agreement.
+Added: In addition, we have entered into an at-the-market sales agreements 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 in “at the market offerings” (as defined in Rule 415 under the Securities Act of 1933, as amended)).
+Added: As of the date hereof, $80.0 million of common stock remains available for sale.
We may experience adverse consequences because of required indemnification of officers and directors.
20 unchanged sentences
The trading market for our common stock is influenced by the research and reports that equity research analysts publish about us and our business.
−Removed: Equity research analysts may elect not to provide, or cease to provide, research coverage of our common stock, and such lack of research coverage may adversely affect the market price of our common stock.
+Added: Equity research analysts may elect not to provide, or cease to provide, research coverage of our
+Added: common stock, and such lack of research coverage may adversely affect the market price of our common stock.
If we do have equity research analyst coverage, we will not have any control over the analysts or the content and opinions included in their reports.
16 unchanged sentences
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.
−Removed: 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
−Removed: 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).
+Added: 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.
3 unchanged sentences
If an ownership change has occurred in the past or occurs in the future, we may not be able to use a material portion of our NOLs and other tax attributes to offset future taxable income or taxes if we attain profitability.
−Removed: In addition to any limitation imposed by Section 382 of Code, the use of NOLs arising after December 31, 2017 generally is limited to a deduction of 80% of taxable income for the corresponding taxable year.
+Added: In addition to any limitation imposed by Section 382 of the Code, the use of NOLs arising after December 31, 2017 generally is limited to a deduction of 80% of taxable income for the corresponding taxable year.
NOLs arising after December 31, 2017, with certain exceptions, may not be carried back to previous taxable years, but may be carried forward indefinitely.
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.