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Item 1. Business

2025-02-25 compared with 2024-02-28 · 360 added, 479 removed, 492 unchanged (63% of the section changed)

We are a commercial-stage biopharmaceutical company focused on discovering, acquiring, developing and commercializing therapeutic medicines for patients suffering from debilitating diseases with significant unmet medical need.

Our portfolio of immune-modulating assets, ARCALYST (rilonacept), abiprubart (also known as KPL-404) and mavrilimumab, is based on strong biologic rationale or validated mechanisms, targets a spectrum of underserved cardiovascular and autoimmune conditions, and offers the potential for differentiation.

ARCALYST is an interleukin-1α and interleukin-1β cytokine trap.

We are a biopharmaceutical company developing and commercializing novel therapies for diseases with unmet need, with a focus on cardiovascular indications.

Our portfolio of assets is based on strong biologic rationale or validated mechanisms and offers the potential for differentiation.

ARCALYST is an interleukin-1α (“IL-1α”) and interleukin-1β (“IL-1β”) cytokine trap.

In 2017, we licensed ARCALYST from Regeneron, which discovered and initially developed the drug.

Our exclusive license to ARCALYST from Regeneron includes worldwide rights, excluding the Middle East and North Africa, for all applications other than those in oncology and local administration to the eye or ear.

In February 2022, we granted Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd.

(“Huadong”) exclusive rights to develop and commercialize ARCALYST in the Asia Pacific region, excluding Japan.

We received FDA approval of ARCALYST for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and children 12 years and older in March 2021.

Recurrent pericarditis is a painful inflammatory cardiovascular disease with an estimated United States prevalent population of approximately 40,000 patients seeking and receiving medical treatment.

ARCALYST is commercially available across the United States through a select network of distributors.

ARCALYST is also approved in the United States for the treatment of Cryopyrin-Associated Periodic Syndromes (“CAPS”), including Familial Cold Autoinflammatory Syndrome (“FCAS”) and Muckle-Wells Syndrome in adults and children 12 years and older, and the maintenance of remission in Deficiency of Interleukin-1 Receptor Antagonist (“DIRA”) in adults and children weighing 10 kg or more.

ARCALYST is commercially available across the United States through a select network of specialty pharmacies.

We are responsible for sales and distribution of ARCALYST in all approved indications in the United States and evenly split profits on sales as well as third party proceeds with Regeneron.

In March 2023, Regeneron initiated a technology transfer of the manufacturing process for ARCALYST drug substance, and we are working with Regeneron to qualify a new CDMO.

Abiprubart (KPL-404) is an investigational monoclonal antibody inhibitor of CD40-CD154 costimulatory interaction.

In 2019, we acquired all of the outstanding securities of Primatope Therapeutics, Inc.

(“Primatope”), the company that owned or controlled the intellectual property related to abiprubart.

In connection with our acquisition of Primatope, we acquired an exclusive world-wide license to abiprubart from Beth Israel Deaconess Medical Center, Inc.

The CD40-CD154 interaction is a key T-cell co-stimulatory signal critical for B-cell maturation, immunoglobulin class switching and Type 1 immune response.

We believe disrupting the CD40-CD154 interaction is an attractive approach to address multiple autoimmune disease pathologies .

In December 2021, we initiated a Phase 2 clinical trial of abiprubart in rheumatoid arthritis (“RA”), which is designed to evaluate pharmacokinetics, safety and efficacy with subcutaneous administration.

In January 2024, we announced topline clinical data from Cohorts 1, 2 and 3 of the trial, and that the trial met its primary efficacy endpoint in Cohort 3 at the weekly dose level.

We expect to announce data from Cohort 4 of the trial in the second quarter of 2024.

For more information see “ Business – Our Products – Abiprubart – Clinical and Pre-Clinical Trials – Phase 2 Trial in Rheumatoid Arthritis ”.

In 2022, we granted Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd.

(“Huadong”) exclusive rights to develop and commercialize ARCALYST in the Huadong Territory (as defined below).

In 2023, Regeneron initiated a technology transfer of the manufacturing process for ARCALYST drug substance, and we are working to qualify Samsung as our replacement CDMO.

KPL-387 is an investigational, fully human immunoglobulin G2 monoclonal antibody that binds human interleukin-1 receptor 1 (“IL-1R1”), inhibiting IL-1α- and IL-1β-mediated signaling.

KPL-387 is an independently developed asset that we believe has the potential to further advance recurrent pericarditis treatment options for patients by providing the added convenience of monthly subcutaneous dosing with a liquid formulation.

In June 2024, we initiated a Phase 1 clinical trial of KPL-387 in normal healthy volunteers.

In February 2025, we announced our plan to initiate a Phase 2/3 clinical trial of KPL-387 in recurrent pericarditis in mid-2025.

We expect data from the Phase 2 portion of the trial in the second half of 2026.

KPL-1161 is an independently developed, pre-clinical, Fc-modified immunoglobulin G2 monoclonal antibody that binds IL-1R1, inhibiting IL-1α- and IL-1β-mediated signaling.

KPL-1161 is a modified version of KPL-387 designed to have an increased drug half-life that we believe could support quarterly subcutaneous dosing.

Abiprubart is an investigational monoclonal antibody inhibitor of CD40-CD154 costimulatory interaction, which we believe to be an attractive approach to address multiple autoimmune disease pathologies.

We hold an exclusive worldwide license to abiprubart from Beth Israel Deaconess Medical Center, Inc.

We previously announced a Phase 2b clinical trial of abiprubart in Sjögren’s Disease.

In February 2025, we announced our plans to discontinue development of abiprubart in the indication and explore strategic alternatives for the asset.

Mavrilimumab is an investigational monoclonal antibody inhibitor targeting granulocyte-macrophage colony stimulating factor receptor alpha (“GM-CSFRα”).

In 2017, we licensed exclusive worldwide rights in all indications to mavrilimumab from MedImmune, Limited (“MedImmune”).

In February 2022, we granted Huadong exclusive rights to develop and commercialize mavrilimumab in the Asia Pacific region, excluding Japan.

We are currently evaluating potential partnership opportunities to advance mavrilimumab’s development.

We previously evaluated mavrilimumab in giant cell arteritis (“GCA”), a chronic inflammatory disease of the medium-to-large arteries, and COVID-19-related acute respiratory distress syndrome (“ARDS”).

In 2017, we licensed exclusive worldwide rights in all indications to mavrilimumab from MedImmune, Limited, which has since been acquired by AstraZeneca PLC (“MedImmune”).

In February 2025, we announced our termination of our license agreement from MedImmune for convenience, effective in May 2025.

In addition, in February 2025, we provided written notice to Huadong that Huadong has not conducted material development activity with respect to mavrilimumab in the People’s Republic of China for a continuous period in excess of six months as required under the mavrilimumab Huadong Collaboration Agreement (as defined below).

Unless Huadong conducts material development activity within 60 days of the notice, the mavrilimumab Huadong Collaboration Agreement will terminate in April 2025.

The following table summarizes our current products, product candidates and out-licensing arrangements:

(1) Approved in the United States;

ARCALYST is also approved for CAPS and DIRA;

ARCALYST is also approved in the United States for CAPS and DIRA;

(2) The FDA granted Breakthrough Therapy designation to ARCALYST for recurrent pericarditis in 2019;

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Kiniksa granted Huadong exclusive rights in the Asia Pacific Region, excluding Japan.

Phase 2 clinical trials of mavrilimumab in rheumatoid arthritis and giant cell arteritis achieved their primary and secondary endpoints with statistical significance;

Kiniksa granted Huadong Medicine exclusive rights in the Asia Pacific Region, excluding Japan.

IL-1α = interleukin-1α;

IL-1β = interleukin-1β;

GM-CSFRα = granulocyte macrophage colony stimulating factor receptor alpha;

OSMRβ = oncostatin M receptor beta.

Using a data-centric approach, our team considers a wide variety of metrics to drive informed capital allocation strategies and generate value from our portfolio of immune-modulating assets, including by analyzing potential additional indications for our products and product candidates, being opportunistic in our business development activities to in-license or acquire programs, considering appropriate opportunities to partner or out-license our programs and conducting internal research to discover and develop molecules to expand our portfolio.

The core of our strategy is the identification, development and commercialization of therapeutic medicines for patients suffering from debilitating diseases with significant unmet medical need.

Using a data-centric approach, our team considers a wide variety of metrics to drive informed capital allocation strategies and generate value from this pipeline, including by analyzing potential additional indications for our products and product candidates, being opportunistic in our business development activities to in-license or acquire programs, considering appropriate opportunities to partner or out-license our programs and conducting internal research to discover and develop molecules to expand our portfolio.

The core of our strategy is the identification, development and commercialization of therapeutic medicines for patients suffering from debilitating cardiovascular diseases with significant unmet medical need.

We put patients first and live by our motto:

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Critical components of our business strategy include the following:

● Commercialize ARCALYST and Our Product Candidates, if Approved .

We have invested in a talented and specialized cardiology sales team, complemented by an efficient marketing strategy, to effectively reach patients and prescribers.

By expanding awareness and building the market for our recurrent pericarditis therapy, we expect to increase patient identification, secure patient access and drive commercial success.

As we develop therapies in other spaces, including the immune-modulating field, we expect to leverage our experience commercializing ARCALYST to maximize the commercial potential of our current and future product candidates, if approved.

● Commercialize ARCALYST .

We have invested in a talented and specialized cardiology sales team, complemented by a successful marketing strategy, to effectively reach patients and prescribers.

By expanding awareness and building the market for ARCALYST, we expect to increase disease awareness, secure patient access, and support our patients throughout their therapy.

● Advance Our Product Candidates Through the Development Process .

Using a data-driven approach, we evaluate development opportunities, possible indications and other factors to advance our portfolio of assets.

We believe that each of our product candidates holds the potential to offer differentiated therapies to patients, and we aim to unlock that potential through innovative research and development.

We believe that each of our product candidates holds the potential to offer differentiated therapy to patients, and we aim to unlock that potential through innovative research and development.

● Explore Opportunities to Drive Value and Maximize the Potential of Our Existing Portfolio.

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We intend to continue to be opportunistic in our business development activities.

ARCALYST is an interleukin-1α and interleukin-1β cytokine trap.

Cytokines are small proteins that play a role in cell signaling.

We received FDA approval of ARCALYST for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and children 12 years and older in March 2021.

ARCALYST is also approved in the United States for the treatment of CAPS, including FCAS and Muckle-Wells Syndrome in adults and children 12 years and older, and the maintenance of remission in DIRA in adults and children weighing 10 kg or more.

ARCALYST was sold by Regeneron in the United States for the treatment of CAPS from 2008 and DIRA from 2020 until we assumed responsibility for sales in such indications in March 2021.

Recurrent pericarditis is a painful autoinflammatory cardiovascular disease with an estimated United States prevalent population of approximately 40,000 patients seeking and receiving medical treatment.

We received Breakthrough Therapy designation from the FDA for ARCALYST for the treatment of recurrent pericarditis in 2019 , Orphan Drug designation from the FDA for ARCALYST for the treatment of pericarditis, which includes the treatment of recurrent pericarditis, in 2020 and FDA approval of ARCALYST for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and pediatric patients 12 years and older in March 2021.

ARCALYST is an IL-1α and IL-1β cytokine trap.

ARCALYST is currently approved in the United States for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and children 12 years and older, the treatment of CAPS, including FCAS and Muckle-Wells Syndrome in adults and children 12 years and older, and the maintenance of remission in DIRA in adults and children weighing 10 kg or more.

ARCALYST was sold by Regeneron in the United States for the treatment of CAPS from 2008 and the maintenance of remission in DIRA from 2020 until we assumed responsibility for sales in such indications in March 2021.

Recurrent pericarditis is the primary indication for which we are commercializing ARCALYST.

It is a severe, debilitating, and chronic autoinflammatory cardiovascular disease with an estimated United States prevalent population of approximately 40,000 patients seeking and receiving medical treatment.

Additionally, in 2021, the European Commission granted Orphan Drug designation to ARCALYST for the treatment of idiopathic pericarditis.

In June 2020, we reported results from RHAPSODY, our global, double-blind, placebo-controlled, randomized-withdrawal design, pivotal Phase 3 clinical trial of ARCALYST in subjects with recurrent pericarditis.

RHAPSODY met its prespecified primary and all major secondary efficacy endpoints with statistical significance, showing that ARCALYST improved clinically meaningful outcomes associated with unmet medical need in recurrent pericarditis.

Subsequent data from the long-term extension portion of RHAPSODY, reported in 2022, demonstrated, among other things, that continued ARCALYST treatment beyond 18 months resulted in continued treatment response.

In February 2022, we granted Huadong exclusive rights to develop and commercialize ARCALYST in the Asia Pacific region, excluding Japan.

In 2022, we granted Huadong exclusive rights to develop and commercialize ARCALYST in the Asia Pacific region, excluding Japan.

Mechanism of Action

ARCALYST is an inhibitor of IL-1α and IL-1β.

IL-1α and IL-1β have been demonstrated to play a key role in inflammatory diseases.

ARCALYST is an inhibitor of IL-1α and IL-1β cytokines.

Cytokines are small proteins that play important roles in intercellular signaling, and IL-1α and IL-1β have been demonstrated to play a key role in inflammatory diseases.

IL-1α and IL-1β provoke potent, proinflammatory events by engaging the IL-1α and IL-1β receptor.

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Other literature published after the June 2022 completion of RHAPSODY corroborated these findings in larger populations of participants.

Beyond recurrent pericarditis, we believe there is significant potential for ARCALYST to address additional indications.

For example, we believe there are other diseases of the cardiovascular system where tissue inflammation may be driven by IL-1α or IL-1β.

More generally, we believe there may be many diseases characterized by painful serosal inflammation that may be driven by IL-1α, and we intend to consider development of ARCALYST in these indications and in others where we believe IL-1α and/or IL-1β plays a key role in disease pathophysiology.

Beyond recurrent pericarditis, we believe there is potential for ARCALYST to address additional indications driven by IL-1α or IL-1β.

We are currently engaged in a collaborative study agreement to explore ARCALYST as a treatment for cardiac sarcoidosis and are exploring strategic opportunities for further development.

In particular, we believe ARCALYST may be advantageous in acute indications that may benefit from a weekly subcutaneous therapy with a proven method of action.

Background and Market Opportunity for Recurrent Pericarditis

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Pericardial effusion, if large enough, can compress the heart extrinsically, requiring emergent drainage.

In March 2021, we received FDA approval to market ARCALYST for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and children 12 years of age and older, and we are exploring opportunities for potential expansion into other countries.

In March 2021, we received FDA approval to market ARCALYST for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and children 12 years of age and older.

Claims analysis, cross validated with published estimates, support a prevalent population of patients with recurrent pericarditis seeking and receiving medical treatment to be approximately 40,000 patients in the United States per year.

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Outside of our core target patient population, there are approximately 26,000 additional patients who are experiencing their first recurrence of the disease.

We have seen that, as we expand awareness about the disease and our therapy, healthcare professionals look to prescribe ARCALYST earlier in the

disease’s natural history.

We have seen that, as we expand awareness about the disease and our therapy, healthcare professionals look to prescribe ARCALYST earlier in the disease’s natural history.

We expect that continuing to execute on this strategy will enable us to target this additional patient population more fully.

Current Treatment Landscape for Recurrent Pericarditis and Our Solution

Current Treatment Landscape for Recurrent Pericarditis

ARCALYST, a weekly, subcutaneously injected, recombinant fusion protein that blocks IL-1α and IL-1β signaling, is the first and only FDA-approved therapy for recurrent pericarditis.

A patient’s initial acute episode of pericarditis is typically treated with NSAIDs or colchicine, both of which are used off-label.

Prior to ARCALYST’s approval, episodes of recurrent pericarditis would usually have been treated in a similar manner or by adding systemic corticosteroids which were also used off-label.

Both colchicine and corticosteroids often have adverse effects when used at high doses or for long periods of time, including, for colchicine, gastrointestinal distress and neutropenia and, for corticosteroids, glaucoma, fluid retention, hypertension, mood changes, memory changes, other psychological effects, weight gain and diabetes.

For these reasons, we believe that ARCALYST plays an important role as a steroid-sparing therapy to be used following a failure on NSAIDs or colchicine to effectively treat recurrent pericarditis.

A patient’s initial acute episode of pericarditis is typically treated with NSAIDs or colchicine.

Prior to ARCALYST’s approval, episodes of recurrent pericarditis would usually have been treated in a similar manner or by adding long-term systemic corticosteroids.

Both colchicine and corticosteroids often have adverse effects when used at high doses or for extended periods of time.

Colchicine’s adverse effects include gastrointestinal distress and neutropenia.

Adverse events that may be caused by corticosteroids include glaucoma, fluid retention, hypertension, mood changes, memory changes, other psychological effects, weight gain and diabetes.

Since our commercial launch of ARCALYST, we have seen a shift in the treatment paradigm, with healthcare professionals prescribing ARCALYST’s targeted immunomodulation before using corticosteroids.

For these reasons, we believe that ARCALYST plays an important role in the effective treatment of recurrent pericarditis as a steroid-sparing therapy.

Clinical Trials

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The percentage of trial days in which participants reported none/minimal pericarditis pain (NRS≤2) at Week 16 of the randomized withdrawal period (a secondary efficacy endpoint of the study) was 92% for ARCALYST recipients compared to 40% for placebo recipients (p<0.0001).

Finally, the time to treatment response (NRS≤2 and CRP≤0.5 mg/dL) for ARCALYST recipients was 5.0 days [95% CI].

Median time to ARCALYST monotherapy was 7.9 weeks [95% CI].

Finally, the time to treatment response (NRS≤2 and CRP≤0.5 mg/dL for ARCALYST recipients was 5.0 [95% CI:

Median time to ARCALYST monotherapy was 7.9 [95% CI:

7.0-8.1] weeks.

We believe these data show that ARCALYST demonstrates clinically meaningful outcomes associated with unmet medical need in recurrent pericarditis.

In November 2022, data from the long-term extension (“LTE”) portion of the RHAPSODY trial were presented, which demonstrated continued ARCALYST treatment beyond 18 months resulted in continued treatment response.

The median [maximum at end of LTE] duration of continuous rilonacept therapy for all participants in RHAPSODY was 23 [35] months;

the median [maximum at end of LTE] duration of continuous rilonacept therapy was 18 months [27] months for United States participants (n=45) and 29 [35] months for non-United States participants (n=29).

The median [maximum at end of LTE] duration of continuous ARCALYST therapy for all participants in RHAPSODY was 23 [35] months;

the median [maximum at end of LTE] duration of continuous ARCALYST therapy was 18 months [27] months for United States participants (n=45) and 29 [35] months for non-United States participants (n=29).

The annualized incidence of pericarditis recurrences while on therapy for all participants (n=74) during the first 18 months of the LTE portion of the trial was 0.04 events per participant-year (compared to 4.4 events per participant-year prior to study entry), none of which were associated with an elevation in C-Reactive Protein (CRP).

Participants (n = 52) were given the option at 18 months from their most recent pericarditis recurrence to continue or suspend rilonacept treatment for observation.

Participants (n = 52) were given the option at 18 months from their most recent pericarditis recurrence to continue or suspend ARCALYST treatment for observation.

There were 33 participants who elected to continue ARCALYST treatment, and the only recurrence in this group was associated with a treatment interruption of 4 weeks.

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The median (interquartile range) time-to-event was 11.8 (3.7, Not-Estimable) weeks.

The 98% reduction in risk of recurrent pericarditis events in participants who continued rilonacept treatment beyond 18 months (Hazard Ratio = 0.02, p<0.0001) was consistent with the results of the randomized withdrawal period.

The 98% reduction in risk of recurrent pericarditis events in participants who continued ARCALYST treatment beyond 18 months (Hazard Ratio = 0.02, p<0.0001) was consistent with the results of the randomized withdrawal period.

Commercial Strategy for ARCALYST

Since our commercial launch of ARCALYST for the treatment of recurrent pericarditis in 2021, we have developed a focused and targeted commercial strategy that vertically integrates multiple key functions.

Our specialty salesforce of approximately 85 representatives as of December 31, 2023 calls on high-volume accounts and prescribers.

Since our commercial launch of ARCALYST for the treatment of recurrent pericarditis in 2021, we have developed a focused and targeted commercial strategy.

Our specialty salesforce calls on high-volume accounts and prescribers.

Our salesforce is complemented by our medical affairs, payor and patient services teams who work to secure broad patient access to ARCALYST, educate communities, collaborate with patient advocacy groups and drive scientific understanding of recurrent pericarditis.

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First, we are focused on increasing awareness of the disease and its impact on patients’ lives.

Our sales and marketing teams work to educate patients and prescribers about the signs, symptoms, duration and treatment of the disease, and the impact that recurrent pericarditis has on patients’ lives.

In addition, we have strategically expanded our field force since launch to improve our ability to connect with prescribers who we believe are best able to identify and treat recurrent pericarditis patients.

By closing the knowledge gap around this rare condition, we expect to drive greater patient access to our therapy.

Second, we seek to advance the treatment paradigm of recurrent pericarditis, ensuring that ARCALYST is viewed as the product of choice for the treatment and reduction in risk of recurrent pericarditis in patients over 12 years of age, ahead of other therapies with a less favorable benefit-risk, such as corticosteroids.

Third, we work to secure broad patient access at a price that reflects ARCALYST’s value as the first and only FDA-approved therapy for recurrent pericarditis.

We believe disease awareness is essential to enable physicians to diagnose recurrent pericarditis earlier in its disease course and to treat the underlying disease, rather than to episodically manage individual flares.

Our sales and marketing teams work to educate patients and prescribers about the signs, symptoms, duration and treatment of the disease, and the impact that

recurrent pericarditis has on patients’ lives.

We have further partnered with each of NHL Hall-of-Famer Henrik Lundqvist and GRAMMY® Award-Winning Singer-Songwriter Carly Pearce as part of our Life DisRPted™ Campaign to drive awareness of recurrent pericarditis.

Second, we aim to secure broad patient access at a price that reflects ARCALYST’s value as the first and only FDA-approved therapy for recurrent pericarditis.

Helping to ensure affordability and access to treatment by patients is one of our core principles.

To this end, we offer a suite of programs to support affordability for eligible patients who are prescribed ARCALYST.

Lastly, we have built a robust patient support program to optimize patient experiences with ARCALYST and Kiniksa.

O ur Kiniksa OneConnect™ program offer s personalized treatment support for eligible patients prescribed ARCALYST , and we continue to improve the service with patient feedback.

Third, we have built a robust patient support program to optimize patient experiences with ARCALYST and Kiniksa.

O ur Kiniksa OneConnect™ program offer s personalized treatment support for eligible patients prescribed ARCALYST.

This program is designed to ensure patients have a positive experience from initiating ARCALYST therapy through the end of their treatment.

Fourth, we are working to improve the patient journey for those suffering from recurrent pericarditis.

For example, in 2024 we announced our sponsorship of the American Heart Association’s Addressing Recurrent Pericarditis initiative.

This initiative is designed to facilitate knowledge-sharing across a collaborative network of healthcare providers around the United States and streamline patient access to expert care.

The participating healthcare sites offer patients dedicated, expert care and aim to shorten patients’ journeys to diagnoses.

Our Product Candidates

Abiprubart is an investigational monoclonal antibody inhibitor of CD40-CD154 costimulatory interaction.

CD40-CD154 interaction is a key T-cell co-stimulatory signal critical for B-cell maturation, immunoglobulin class switching, and Type 1 immune response.

In May 2021, we reported positive final data from our randomized, double-blind, placebo-controlled, single-ascending-dose Phase 1 clinical trial of abiprubart in healthy volunteers which evaluated safety and pharmacokinetics, as well as receptor occupancy (“RO”) and T-dependent antibody response (“TDAR”) in these subjects.

We are currently conducting a Phase 2 clinical trial of abiprubart in RA, which is designed to enable its potential development in a spectrum of autoimmune diseases believed to be mediated by the CD40-CD154 co-stimulatory interaction.

In January 2024, we announced topline clinical data from Cohorts 1, 2 and 3 of the trial and that the trial met its primary efficacy endpoint in Cohort 3 at the weekly dose level.

We expect to announce data from Cohort 4 of the trial in the second quarter of 2024.

We have not yet announced next steps for our abiprubart program, but the CD40-CD154 costimulatory interaction has been implicated in a number of devastating auto-immune diseases.

We plan to make further development decisions based upon the totality of the data following the receipt of data from Cohort 4 of our Phase 2 clinical trial.

KPL-387 is an investigational, fully human immunoglobulin G2 monoclonal antibody that binds IL1-R1, inhibiting the signaling of both IL-1α and IL-1β cytokines.

KPL-387 is an independently developed asset that we believe has the potential to further advance recurrent pericarditis treatment options for patients with the potential to add the convenience of monthly subcutaneous dosing with a liquid formulation.

In June 2024, we initiated a Phase 1 clinical trial of KPL-387 in normal healthy volunteers and data from such study suggests that KPL-387 holds the potential for monthly subcutaneous dosing.

In February 2025, we announced our plan to initiate a Phase 2/3 clinical trial of KPL-387 in recurrent pericarditis in mid-2025.

We expect data from the Phase 2 portion of the trial in the second half of 2026.

Mechanism of Action

Abiprubart is designed to block CD40-CD154 costimulatory interaction by binding to and inhibiting signaling through the CD40 receptor.

CD40 is a member of the Tumor Necrosis Factor Receptor superfamily which is constitutively or inducibly expressed on the surface of a variety of immune and non-immune cell types including B cells, macrophages, dendritic cells, microglia, endothelial cells, epithelial cells, and keratinocytes and can also be upregulated on other cell types in the context of autoimmune disease.

Interactions between B cell-expressed CD40 and its binding partner, CD40L, mainly expressed on activated CD4+ T cells, play a critical role in promoting germinal center formation and the production of class-switched antibodies.

The role of CD40 in B cells has been extensively characterized and has been shown to be essential for productive primary and secondary humoral immune responses to T dependent antigens.

External clinical data that point to the broad potential power of the mechanism has been established in RA, systemic lupus erythematosus, Primary Sjögren’s syndrome and Graves’ disease.

Ongoing Phase 2 trials from competitors implicate additional indications for potential development, including type 1 diabetes, prevention of liver transplant rejection, hidradenitis suppurativa, lupus nephritis and multiple sclerosis.

Abiprubart inhibits CD40-CD154 costimulatory interaction with low-single digit nanomolar affinity to CD40 in vitro .

The presentation of abiprubart is as a high-concentration liquid formulation, which we believe may allow for a higher delivered dose in one subcutaneous injection than all other competitors whose formulations are limited mainly to high dose IV or lower-dose subcutaneous administration.

We believe some competitor assets do not fully antagonize signaling as evidenced by efficacy failures and the generation of anti-drug antibodies even at maximum delivered and/or attainable dose levels.

Clinical and Preclinical Trials

KPL-387 binds IL-1R1, inhibiting the signaling of IL-1α and IL-1β cytokines.

We believe there are diseases of the cardiovascular system where tissue inflammation may be driven by IL-1α and/or IL-1β, and we intend to consider development of KPL-387 in these indications and in others where we believe IL-1α and/or IL-1β plays a key role in disease pathophysiology.

We are developing KPL-387 for the treatment of recurrent pericarditis.

We believe its formulation offers the potential opportunity for convenient delivery in a prefilled syringe or autoinjector once a month.

Preclinical Development and Clinical Trials

Preclinical Development

In preclinical development, abiprubart has been observed to have a favorable pharmacokinetic and toxicology profile and has shown activity in multiple non-human primate models of organ transplant rejection, as well as in multiple TDAR models.

Data published in a peer-reviewed journal demonstrated that abiprubart prolonged the suppression of TDAR response in a non-human primate model.

Abiprubart had linear pharmacokinetics with low variability, which translated into complete suppression of antibody responses to a novel antigen (KLH) at drug levels achieving 100% receptor occupancy.

In vitro studies with KPL-387 demonstrated its ability to potently inhibit IL-6 production from peripheral blood mononuclear cells when stimulated with either Il-1α or IL-1β.

In vivo pharmacokinetic studies of KPL-387 in non-human primates demonstrated good pharmacokinetic properties.

We believe that these pharmacokinetic data, combined

with the potent inhibition of IL-1 signaling that we observed in vitro , suggest that this therapeutic effect could be achieved with monthly subcutaneous administration in future clinical studies.

Phase 1 Clinical Trial

We previously conducted a Phase 1 single-ascending-dose clinical trial of abiprubart, which was a randomized, double-blind, placebo-controlled, single-ascending-dose, first-in-human study that was divided into two parts:

a single dose of abiprubart 0.03 mg/kg, 0.3 mg/kg, 1 mg/kg, 3 mg/kg or 10 mg/kg IV and a single dose of abiprubart 1 mg/kg or 5 mg/kg subcutaneously administered to separate cohorts of healthy volunteers.

The primary objective was to assess the safety and tolerability of abiprubart.

Secondary endpoints included pharmacokinetics, CD40 RO, the immune response to the novel test antigen KLH in clinically relevant dose cohorts, and the anti-drug antibody response.

In May 2021, we reported final results from this Phase 1 trial of abiprubart, which met both its primary objective and secondary endpoints.

Results from the trial, which were presented at a scientific meeting and published in a peer-reviewed journal, included the following:

● Abiprubart showed dose-dependent increases in concentration across cohorts.

All dose escalations occurred as per protocol with no dose-limiting safety findings.

● Abiprubart was well-tolerated, and there were no serious adverse events.

● Subjects dosed with abiprubart 10 mg/kg IV showed full RO through at least Day 71 and complete suppression of TDAR after KLH challenge and re-challenge through at least Day 57.

● The 3 mg/kg IV dose level demonstrated complete suppression of memory TDAR response to a re-challenge on Day 29.

● Subjects subcutaneously dosed with abiprubart 5 mg/kg showed full RO through Day 43 and suppression of TDAR after KLH challenge through at least Day 29.

These data confirm and extend the 3 mg/kg IV cohort data.

● Anti-drug antibodies to abiprubart were suppressed for at least 57 days at 10 mg/kg IV;

the suppression of antibody responses to the drug itself is an independent indicator of target engagement and pharmacodynamic effect.

Phase 2 Trial in Rheumatoid Arthritis

In December 2021, we commenced a Phase 2 clinical trial of abiprubart in RA.

The Phase 2 trial is a randomized, double-blind, placebo-controlled study designed to provide pharmacokinetic data and early signal of efficacy with chronic administration, and optionality to evaluate abiprubart across a range of other autoimmune diseases.

The trial enrolled participants with active RA who had an inadequate response to or were intolerant to a Janus kinase inhibitor (a “JAKi”) or at least one biologic disease-modifying anti-rheumatic drug (a “bDMARD”).

Cohorts 1 and 2 each sequentially randomized eight participants in a 6:2 ratio to receive abiprubart (2mg/kg or 5mg/kg, respectively) or placebo as a subcutaneous injection every 2 weeks for 12 weeks.

The primary objective for Cohorts 1 and 2 included pharmacokinetics across dosing levels and the incidence of treatment-emergent adverse events.

Cohort 3 randomized 78 participants in a 1:1:1 ratio to receive abiprubart 5 mg/kg every week, 5 mg/kg every 2 weeks, or placebo every week as a subcutaneous injection for 12 weeks.

The participants who received abiprubart 5 mg/kg every 2 weeks received weekly administrations of alternating active investigational product and matching blinded placebo.

The primary efficacy endpoint for Cohort 3 was the change in baseline in DAS28-CRP at Week 12.

The secondary objectives for Cohort 3 were the incidence of treatment-emergent adverse events and pharmacokinetics across dose levels.

Cohort 4 randomized 51 participants in a 3:2 ratio to receive abiprubart 400mg (following a 600 mg loading dose) or placebo as a subcutaneous injection every 4 weeks for 12 weeks.

The primary efficacy endpoint for Cohort 4 was identical to Cohort 3.

In January 2024, we reported topline data from Cohorts 1, 2 and 3 of the trial.

We expect to report data from Cohort 4 in the second quarter of 2024.

The reported data were as follows:

● In Cohorts 1 and 2 (the pharmacokinetic-lead in), multiple doses of abiprubart were well-tolerated and enabled the proof-of-concept portion of the study.

Although these cohorts were not powered for DAS28-CRP, the secondary efficacy endpoint of Cohorts 3 and 4, the following results were observed:

o In Cohort 1, in the abiprubart 2 mg/kg subcutaneous biweekly dosing group (n=6), the mean change from baseline in DAS28-CRP at week 12 was -3.16 points compared to -1.09 points in pooled placebo participants (n=4), (mean difference = -2.07, p=0.0312).

o In Cohort 2, in the abiprubart 5 mg/kg subcutaneous biweekly dosing group (n=6), the mean change from baseline in DAS28-CRP at week 12 was -3.44 points compared to pooled placebo participants (n=4), (mean difference = -2.35, p=0.0338).

● In Cohort 3, in the abiprubart 5 mg/kg subcutaneous weekly dosing group (n=27), the Least Squares (“LS”) mean change [95% CI] from baseline in DAS28-CRP at week 12 was -2.21 [-2.62, -1.80] points compared to -1.65 [-2.07, -1.23] points in placebo participants (n=26), (LS mean difference = -0.56, p=0.0487).

● In Cohort 3, in the abiprubart 5 mg/kg subcutaneous biweekly dosing group (n=25), the LS mean change [95% CI] from baseline in DAS28-CRP at week 12 was -2.00 [-2.43, -1.58] points compared to -1.65 [-2.07, -1.23] points in placebo participants (n=26), (LS mean difference = -0.35, p=0.2140).

● Abiprubart significantly reduced rheumatoid factor (a clinical marker of disease activity and autoantibody pharmacodynamic marker of CD40 target engagement) by over 40% in both Cohort 3 dose levels.

● Abiprubart was well-tolerated, with no dose-related adverse experiences observed.

In June 2024, we initiated a Phase 1 clinical trial of KPL-387 in healthy volunteers.

Topline data from the trial have shown that a single subcutaneous dose of KPL-387 maintained levels in circulation sufficient to support our belief that KPL-387 could offer the potential for monthly subcutaneous dosing in recurrent pericarditis, a chronic disease that can last for years.

We aim to further explore this hypothesis during Phase 2 development.

Phase 2 Clinical Trial

In February 2025, we announced our plan to initiate a Phase 2/3 clinical trial of KPL-387 in recurrent pericarditis in mid-2025.

We expect data from the Phase 2 portion of the trial in the second half of 2026.

KPL-1161 is an independently developed, pre-clinical, Fc-modified immunoglobulin G2 monoclonal antibody that binds IL-1R1, inhibiting IL-1α- and IL-1β-mediated signaling.

KPL-1161 is a modified version of KPL-387 designed to have an increased drug half-life that we believe could support quarterly subcutaneous dosing.

We are currently conducting pre-clinical development of this asset.

Abiprubart is an investigational monoclonal antibody inhibitor of CD40-CD154 costimulatory interaction.

We previously announced a Phase 2b clinical trial of abiprubart in Sjögren’s Disease.

In February 2025, we announced our plans to discontinue development of abiprubart in the indication and explore strategic alternatives for the asset.

We previously conducted a proof-of-concept Phase 2 clinical trial of abiprubart in RA.

We believe that disrupting the CD40-CD154 co-stimulatory interaction is an attractive approach to addressing multiple autoimmune disease pathologies.

We also believe that abiprubart’s ability to be administered in a high-concentration subcutaneous formulation that enables monthly dosing potentially distinguishes it from other competitors.

In July 2024, we commenced a Phase 2b clinical trial of abiprubart in Sjögren’s Disease.

In February 2025, as part of our strategic reprioritization of our portfolio and certain capital allocation considerations, we announced our plans to discontinue our Phase 2b clinical trial of abiprubart in Sjögren’s Disease.

We expect to immediately end clinical trial enrollment and initiate winddown activities.

Mavrilimumab is a fully-human monoclonal antibody that is designed to antagonize GM-CSF signaling by binding to the alpha subunit of the GM-CSF receptor.

We are currently evaluating potential partnership opportunities to advance mavrilimumab’s development.

We previously evaluated mavrilimumab in COVID-19-related ARDS.

Following the announcement that the Phase 3 portion of our global, double-blind, placebo-controlled clinical trial of mavrilimumab in COVID-19-related ARDS did not meet its primary efficacy endpoint in December 2021, we decided not to progress mavrilimumab in such indication at that time.

We also previously evaluated mavrilimumab in GCA, a chronic inflammatory disease of the medium-to-large arteries with an estimated United States prevalence of approximately 75,000 to 150,000 patients.

In October 2020, we announced that our global, randomized, double-blind, placebo-controlled Phase 2 proof-of-concept clinical trial for the study of mavrilimumab in GCA achieved both the primary efficacy endpoint of time-to-first adjudicated GCA flare by week 26 in all treated participants and the secondary efficacy endpoint of sustained remission at week 26 in all treated participants with statistical significance.

Additionally, while the trial was not powered for individual disease cohorts, there was a consistent trend of efficacy across the new onset and relapsing/refractory cohorts.

In September 2020, the FDA granted Orphan Drug designation for mavrilimumab for the treatment of GCA.

In February 2022, we announced that we do not plan to initiate a Phase 3 trial of mavrilimumab in GCA.

Before we licensed mavrilimumab in 2017, MedImmune was developing mavrilimumab for the treatment of RA.

MedImmune had received authorization to conduct clinical trials for RA in Europe and executed an extensive Phase 1 and Phase 2 clinical program in which the company studied mavrilimumab in over 550 participants with RA through Phase 2b.

MedImmune’s clinical trials in RA through Phase 2b achieved their prospectively defined endpoints of efficacy or safety.

In February 2022, we granted Huadong exclusive rights to develop and commercialize mavrilimumab in the Asia Pacific region, excluding Japan.

Mechanism of Action

Literature data implicate GM-CSF as a key player in the immune system:

enhancing trafficking of myeloid cells through activated endothelium of blood vessels and contributing to monocyte and macrophage accumulation in blood vessels during inflammation;

promoting activation, differentiation, survival and proliferation of monocytes and macrophages, as well as resident tissue macrophages in inflamed tissues;

promoting the differentiation of effector T cells at inflamed sites and draining lymph nodes;

and regulating the phenotype of antigen presenting cells in inflamed tissues by promoting the differentiation of infiltrating monocytes into M1 macrophages and monocyte derived dendritic cells (“MoDCs”).

These studies have demonstrated that with GM-CSF overexpression, pathological changes almost always follow.

Subsequent data from our Phase 2 clinical trial of mavrilimumab in GCA, which met its primary and secondary efficacy endpoints, further supported the mechanistic rationale of targeting GM-CSF.

Mavrilimumab is designed to inhibit the signaling of GM-CSF, a growth factor that stimulates the production of certain types of white blood cells.

In an ex vivo GCA artery culture model, mavrilimumab inhibited inflammatory molecules characteristic of GCA pathophysiology.

Inhibition of the GM-CSFR pathway was confirmed by significant decreases in PU.1 mRNA levels.

Inhibition of related immune pathways was demonstrated by significant decreases in mRNA for TNFα and CXCL10 mRNA as well as decreases in CXCL10 protein and mRNA levels.

The observed significant decrease in IL-6 protein levels was consistent with the decrease in IL-6 mRNA levels observed with mavrilimumab treatment in RA participants in Phase 2.

In February 2025, we delivered a notice of termination to MedImmune, notifying them of our intent to terminate for convenience the MedImmune Agreement (as defined below) effective May 22, 2025.

In 2022, we granted Huadong exclusive rights to develop and commercialize mavrilimumab in the Asia Pacific region, excluding Japan.

In February 2025, we provided written notice to Huadong that Huadong has not conducted material development activity with respect to mavrilimumab in the People’s Republic of China for a continuous period in excess of six months as required under the mavrilimumab Huadong Collaboration Agreement.

Unless Huadong conducts material development activity within 60 days of the notice, the mavrilimumab Huadong Collaboration Agreement will terminate in April 2025.

Discovery Activities

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Although we have built a development and manufacturing facility to produce drug substance to support certain research, preclinical and other clinical development for our product candidates, we rely, and expect to continue to rely, on third parties for the manufacture of our late-stage product candidates and certain of our early-stage product candidates for the majority of our clinical development efforts, as well as for the commercial manufacture of ARCALYST and our future products.

Regeneron manufactures and supplies all of our requirements of ARCALYST for development and commercial activities pursuant to the Supply Agreement (as defined below).

Regeneron currently manufactures and supplies all of our requirements of ARCALYST for development and commercial activities pursuant to the Supply Agreement (as defined below).

The Supply Agreement terminates upon the sooner of the termination of the Regeneron Agreement and the date of the completion of the transfer of technology related to the manufacture of ARCALYST drug substance.

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We are currently conducting a transfer of technology related to the manufacturing process of ARCALYST drug substance and the analytical testing methods of ARCALYST drug substance and drug product.

As part of this process, we are qualifying and contracting with a CDMO who will serve as the new manufacturer of ARCALYST drug substance and CTLs who will serve as the new analytical testing labs of ARCALYST drug substance and drug product.

See, Risk Factors – Risks Related to Manufacturing and Our Reliance on Third Parties – We are conducting a technology transfer with respect to the manufacturing process of ARCALYST drug substance from Regeneron to a new CDMO and the analytical testing methods of ARCALYST drug substance and drug product to new CTLs.

As part of this process, we are working with Samsung, who will serve as the new manufacturer of ARCALYST drug substance and CTLs who will serve as the new analytical testing labs of ARCALYST drug substance and drug product.

See, Risk Factors – Risks Related to Manufacturing and Our Reliance on Third Parties – We are conducting a technology transfer with respect to the manufacturing process of ARCALYST drug substance from Regeneron to Samsung and the analytical testing methods of ARCALYST drug substance and drug product to new CTLs.

Such technology transfer will be subject to significant risks and uncertainties.

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Our commercial team combines dozens of years of pharmaceutical commercial leadership experience with a passion for helping patients with significant unmet medical need.

Since March 2021, we have marketed ARCALYST, our only commercial product, in the United States for recurrent pericarditis, a debilitating disease, and have established our own specialty salesforce to expand our commercialization efforts nationwide.

Since March 2021, we have marketed ARCALYST, our only commercial product, in the United States for recurrent pericarditis and have established our own specialty salesforce to expand our commercialization efforts nationwide.

Our salesforce is complemented by our medical affairs, payor and patient services teams.

We have also built an efficient digital marketing effort by targeting prescribers currently treating recurrent pericarditis to complement the reach of our salesforce.

For more information, see “ —Our Products—ARCALYST – Commercial Strategy for ARCALYST .”

We intend to expand our capabilities in parallel with the development path of our product candidates.

For each product candidate, we will establish commercialization strategies as we approach potential marketing approval, including leveraging our then-existing medical affairs, payor and patient services teams, and marketing organization, as well as building bespoke infrastructure to address the specific needs and challenges inherent to any targeted indication.

In 2024, we launched a number of initiatives intended to increase disease awareness of recurrent pericarditis, including sponsoring the American Heart Association’s Addressing Recurrent Pericarditis initiative and launching our Life DisRPted campaign.

For more information, see “ Business—Our Products—ARCALYST – Commercial Strategy for ARCALYST .”

The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products.

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Our products and any product candidates that we successfully develop and commercialize may compete with existing products and new products that may become available in the future.

The key competitive factors affecting the success of ARCALYST, abiprubart and mavrilimumab and any other product candidates that we develop, if approved, are likely to be their efficacy, safety, convenience, price, the level of biosimilar competition and the availability of reimbursement from government and other third party payors.

Our commercial opportunities could be reduced or eliminated if our competitors develop and commercialize products that are more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.

We believe the key competitive factors affecting the success of ARCALYST and any product candidates that we successfully develop and commercialize, are their efficacy, safety, convenience, price, the effectiveness of companion diagnostics in guiding the use of related products, market acceptance by prescribers and patients, the level of biosimilar competition and the availability of reimbursement from government and other third party payors.

Our commercial opportunities could be reduced or eliminated if our competitors develop and commercialize products that are more effective, have fewer or less severe side effects, are more convenient (including method of delivery and administration by the patient) or are less expensive than our products.

Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours.

In addition, if a competitor obtains regulatory approval for an orphan drug before us, and we are developing a product candidate for the same orphan indication, subject to applicable jurisdictional laws, Orphan Drug exclusivity may no longer be available for our product candidate, if approved, unless we can show a significant benefit over the already approved orphan drug.

Moreover, where we and a competitor are developing the same or similar drug for the same orphan indication, and the competitor is first to obtain regulatory approval and is granted orphan exclusivity, subject to applicable jurisdictional laws, we may be denied regulatory approval of our product candidate for such orphan indication for the duration of the competitor’s Orphan Drug exclusivity period.

This may allow a competitor to gain a market advantage ahead of any potential commercialization of one of our product candidates, if approved.

In addition, our ability to compete may be affected in many cases by insurers or other third party payors seeking to encourage the use of biosimilar products.

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Recurrent Pericarditis :

We are not aware of any FDA-approved therapies for recurrent pericarditis, but we are aware of two programs being developed for this indication.

One is by R-Pharm International (RPH-104), which inhibits IL-1α/IL-1β-induced signaling and is in Phase 2 development;

the other is an oral cannabidiol being developed by Cardiol Therapeutics in an open label Phase 2 setting.

We are not aware of any FDA-approved therapies for recurrent pericarditis, but we are aware of three competitors developing treatments for this indication.

CardiolRx is an oral cannabidiol being developed by Cardiol Therapeutics in a Phase 2/3 setting, targeting patients who are discontinuing treatment with an IL-1 blocker.

R-Pharm International is developing goflikicept, which inhibits IL-1α/IL-1β-induced signaling.

This drug is approved and marketed in Russia but its Phase 2/3 United States trial has been suspended as of November 2024.

Ventyx Biosciences is developing VTX2735, which is designed to inhibit the NLRP3 inflammasome, an intracellular sensor of a broad range of danger signals, that leads to the release of IL-1β and IL-18.

In addition to their development program in CAPS, Ventyx Biosciences has announced their intention to initiate a Phase 2 trial of VTX2735 in recurrent pericarditis in January 2025.

Dual IL-1α and IL-1β Inhibition :

Other drugs, while not approved for the treatment of recurrent pericarditis, also inhibit IL-1α/IL-1β-induced signaling.

Anakinra (KINERET), marketed by Swedish Orphan Biovitrum AB, is currently approved for use in RA, CAPS and DIRA.

We are not aware of any active, industry sponsored development programs using anakinra seeking a label for recurrent pericarditis.

Lutikizumab is an IL-1α/IL-1β inhibitor and is being developed by Abbvie for the treatment of hidradenitis suppurativa and RPH-104 is also an IL-1α/IL-1β inhibitor and is currently in development for recurrent pericarditis.

IL-1β Inhibition Alone :

Canakinumab (ILARIS), marketed by Novartis Pharmaceuticals Corporation, is currently approved for use in CAPS, Tumor Necrosis Factor Receptor Associated Periodic Syndrome (TRAPS), Hyperimmunoglobulin D Syndrome (HIDS), Mevalonate Kinase Deficiency (MKD) and Familial Mediterranean Fever (FMF), Still’s Disease and Systemic Juvenile Idiopathic Arthritis (SJIA).

We are not aware of any active, industry sponsored development programs using canakinumab seeking a label for recurrent pericarditis.

Lutikizumab is being developed by Abbvie for the treatment of hidradenitis suppurativa and goflikicept is currently in development for recurrent pericarditis.

IL-1β Inhibition Alone :

There are therapies which modulate IL-1α in preclinical and clinical development for diseases other than recurrent pericarditis from Johnson & Johnson and XBIOTECH USA, INC.

We are not aware of any active, industry sponsored development programs for these product candidates seeking a label for recurrent pericarditis.

There are also drugs that inhibit IL-1β-induced signaling but do not inhibit IL-1α-induced signaling.

Syndrome (HIDS), Mevalonate Kinase Deficiency (MKD), Familial Mediterranean Fever (FMF), Adult Onsent Still’s Disease (AOSD), Systemic Juvenile Idiopathic Arthritis (SJIA) and gout flares.

Other Competitors .

We are also aware of several other molecules which do not directly compete with our approved indications but nonetheless target IL-1α and/or IL-1β directly or indirectly.

We are also aware of several molecules in development designed to inhibit the NLRP3 inflammasome, an intracellular sensor of a broad range of danger signals, that leads to the release of IL-1β and IL-18.

Clinical stage development programs targeting IL-1α and/or IL-1β directly or indirectly via the NLRP3 inflammasome include VTX2735 (by Ventyx Biosciences in CAPS) and VTX3232 (Ventyx Biosciences, no indication announced);

We are also aware of several other molecules that do not directly compete with our approved indications for ARCALYST but nonetheless target IL-1α and/or IL-1β directly or indirectly.

Clinical stage development programs targeting IL-1α and/or IL-1β directly or indirectly via the NLRP3 inflammasome include:

lutikizumab (by Abbvie for the treatment of hidradenitis suppurativa, ulcerative colitis, atopic dermatitis and Crohn’s Disease);

ZYIL-1 (by Zydus Lifesciences in amyotrophic lateral sclerosis);

HT-6184 (by Halia in myelodysplastic syndromes);

OLT1177 (by Olatec Therapeutics in osteoarthritis of the knee);

HT-6184 (by Halia in myelodysplastic syndromes, inflammatory pain);

MRT-8102 (by Monte Rosa Therapeutics, no development indications announced);

OLT1177 (by Olatec Therapeutics in osteoarthritis of the knee and acute gout flares);

DFV-890 (by Novartis in FCAS);

Selnoflast (by Roche in ulcerative colitis), NT-0167 and NT-0796 (by NodThera, no indication announced);

and Somalix and Inzomelid (by Roche, no indications announced).

Selnoflast (by Roche, no indications announced);

NT-00249 (by NodThera, no indications announced);

NT-0796 (by NodThera in obesity);

Somalix and Inzomelid (by Roche, no indications announced);

VTX-3232 (by Ventyx Bioscience in Parkinson’s);

SSGJ-613 (by Sunshine Guojian Pharmaceuticals in acute gout);

Natrunix (by XBIOTECH Inc in rheumatoid arthritis, axial spondylarthritis);

AVTX-009 (by Avalo Therapeutics in hidradenitis suppurativa);

CAN-10 (by Cantargia in healthy subjects and plaque psoriasis) and VENT-02 (by Ventus Therapeutics, no indications announced).

There are also therapies that modulate IL-1α-induced signaling in preclinical and clinical development for diseases other than recurrent pericarditis from Johnson & Johnson and XBIOTECH USA, INC.

Since we currently expect to develop KPL-387 for the treatment of recurrent pericarditis, we believe that it will compete with the same assets as those described under “ Business—Competition—ARCALYST ”, which includes a number of drugs that target IL-1α and/or IL-1β.

For recurrent pericarditis, there are a number of drugs in development that explore alternative dosing methods and frequencies to the once-weekly subcutaneous dosing method of ARCALYST, the only currently FDA-approved treatment.

Both CardiolRx and VTX2735, in Phase 3 and 2 development by Cardiol Therapeutics and Ventyx Biosciences, respectively, are being investigated for oral administration.

Goflikicept, currently marketed solely in Russia, though with prior clinical studies conducted in the United States, is dosed subcutaneously every two weeks following an initial loading dose.

We expect that additional therapies offering even more convenient dosing, including those listed in the sections above, may enter the market, including therapies that offer quarterly dosing.

For KPL-387 to succeed on a commercial basis, if approved, we expect that it will need to compete against such drugs by offering a more convenient dosing regimen and/or an improved risk-benefit profile than other available options.

There are various programs in clinical development antagonizing the CD40 / CD154 costimulatory pathway;

however, we believe the high concentration liquid formulation of abiprubart enables chronic subcutaneous dosing at a higher dose level than other similar drugs, which could be a key differentiator.

Subcutaneous Administration :

Novartis A.G.

is developing CFZ-533, or iscalimab (anti-CD40) for subcutaneous administration for the treatment of Sjögren’s Syndrome and is studying other various indications in clinical development.

Intravenous Administration Only :

is developing the Tn3 fusion protein, dazodalibep (anti-CD40L) in Sjogren’s Syndrome;

however, we believe the high concentration liquid formulation of abiprubart may enable chronic subcutaneous dosing at a higher dose level than other similar drugs, which could be a key differentiator.

Sanofi S.A./ImmuNext Inc.

are developing frexalimab (anti-CD40L) for the treatment of Multiple Sclerosis, Systemic Lupus Erythematosus, Type 1 Diabetes and Focal segmental glomerulosclerosis;

are developing dapirolizumab pegol (anti-CD40L) for the treatment of moderately to severely active Systemic Lupus Erythematosus;

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is developing AT-1501 (anti-CD40L) for use by patients undergoing kidney transplantation.

Potential Subcutaneous Administration :

Certain other programs present the potential for subcutaneous administration.

Sanofi S.A./ImmuNext Inc.

are developing frexilimab (anti-CD40L) for the treatment of Multiple Sclerosis, Primary Sjögren’s Syndrome and Systemic Lupus Erythematosus;

Bristol Myers-Squibb is developing BMS-986325 (anti-CD40) for the treatment of Primary Sjögren’s Syndrome;

Innovent Bio is developing IBI-355 (anti-CD40L, no indication announced);

Such drugs are being developed for intravenous administration only.

Other programs present the potential for subcutaneous administration.

Innovent Bio is developing IBI-355 (anti-CD40L, no indication announced) and H.

Lundbeck A/S is developing Lu AG22515 (bi-specific, anti-CD40L & Albumin (scFv)2-Fab, no indication announced).

GM-CSF Antagonists :

There are programs in clinical development in various indications that modulate GM-CSF signaling from I-MAB Biopharma Co.

(plonmarlimab in RA), Roivant Sciences Ltd.

(gimsilumab and namilumab in sarcoidosis) and Humanigen, Inc.

(lenzilumab).

All of these competitive programs target the GM-CSF ligand itself versus targeting the GM-CSF receptor like mavrilimumab.

License and Acquisition Agreements

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Under the Genentech License Agreement, we received an upfront payment of $80.0 million for the license.

Additionally, in 2023, we received a total of $35.0 million in additional payments from Genentech related to delivery of certain drug material to Genentech and Genentech’s achievement of a development milestone.

In the fourth quarter of 2023, following the achievement of a development milestone related to a second indication under the Genentech License Agreement, Genentech became obligated to make an additional cash payment of $10.0 million, which was received in the first quarter of 2024.

We are eligible to receive up to approximately $575.0 million in additional contingent payments, including specified development, regulatory and sales-based milestones, before fulfilling our upstream financial obligations.

In total, we have recognized $50.0 million in additional payments from Genentech related to delivery of certain drug material to Genentech and Genentech’s achievement of development milestones under the Genentech License Agreement.

We remain eligible to receive up to approximately $570.0 million in additional contingent payments, including specified development, regulatory and sales-based milestones, before fulfilling our upstream financial obligations.

We will also be eligible to receive tiered percentage royalties on a Genentech Licensed Product-by-Genentech Licensed Product basis ranging from low double digits to mid-teens on annual net sales of each Genentech Licensed Product, subject to certain customary reductions, with an aggregate minimum floor, before fulfilling our upstream financial obligations.

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Pursuant and subject to the terms of the Genentech License Agreement, Genentech has the exclusive worldwide right to conduct development and commercialization activities for Genentech Licensed Products at its sole cost.

Notwithstanding the foregoing, we are responsible, at our sole cost, for completing the Phase 2b clinical trial assessing the efficacy, safety and tolerability of vixarelimab in reducing pruritis in prurigo nodularis.

We and Genentech participate in a joint transition committee, which coordinates and oversees the technology and inventory transition activities relating to the development of the Genentech Licensed Products and our conduct and finalization of the Phase 2b clinical trial.

Under the Genentech License Agreement, Genentech has the right to assume manufacturing responsibilities for Genentech Licensed Products.

In 2024, we fulfilled our responsibility under the Genentech License Agreement to complete the Phase 2b clinical trial assessing the efficacy, safety and tolerability of vixarelimab in reducing pruritis in prurigo nodularis.

Absent early termination, the Genentech License Agreement will continue until there are no more royalty or other payment obligations owed to us.

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People’s Republic of China, Hong Kong SAR, Macao SAR, Taiwan Region, South Korea, Indonesia, Singapore, The Philippines, Thailand, Australia, Bangladesh, Bhutan, Brunei, Burma, Cambodia, India, Laos, Malaysia, Maldives, Mongolia, Nepal, New Zealand, Sri Lanka, and Vietnam (collectively, the “Huadong Territory”).

We otherwise retain our current rights to the Huadong Licensed Products outside the Huadong Territory.

We otherwise retained our current rights to the Huadong Licensed Products outside the Huadong Territory.

Unless Huadong conducts material development activity within 60 days of the notice, the mavrilimumab Huadong Collaboration Agreement will terminate on April 25, 2025.

Under the Huadong Collaboration Agreements, we received a total upfront cash payment of $22.0 million, which includes $12.0 million for the Huadong Territory license of ARCALYST and $10.0 million for the Huadong Territory license of mavrilimumab.

We will be eligible to receive up to approximately $70.0 million in payments for ARCALYST, and up to approximately $576.0 million in payments for mavrilimumab, including specified development, regulatory and sales-based milestones.

Huadong will also be obligated to pay us tiered percentage royalties on a Huadong Licensed Product-by-Huadong Licensed Product basis ranging from the low-teens to low-twenties on annual net sales of each Huadong Licensed Product in the Huadong Territory, subject to certain reductions tied to ARCALYST manufacturing costs and certain other customary reductions, with an aggregate minimum floor.

Royalties will be payable on a Huadong Licensed Product-by-Huadong Licensed Product and country-by-country or region-by-region basis until the later of (i) 12 years after the first commercial sale of the applicable Huadong Licensed Product in such country or region in the Huadong Territory, (ii) the date of expiration of the last valid patent claim of our patent rights or any joint collaboration patent rights that covers the applicable Huadong Licensed Product in such country or region in the Huadong Territory, and (iii) the expiration of the last regulatory exclusivity for the applicable Huadong Licensed Product in such country or region in the Huadong Territory.

Pursuant and subject to the terms of the Huadong Collaboration Agreements, Huadong has the exclusive right to conduct Huadong Territory-specific development activities for the Huadong Licensed Products in the Huadong Territory, the first right to support global development of the Huadong Licensed Products by serving as the sponsor of the global clinical trials conducted in the Huadong Territory and the exclusive right to commercialize the Huadong Licensed Products in the Huadong Territory.

In the fourth quarter of 2024, following the achievement of a regulatory milestone under the ARCALYST Huadong Collaboration Agreement, Huadong became obligated to make an additional cash payment of $20.0 million, which was received in the first quarter of 2025.

We remain eligible to receive up to approximately $50.0 million in sales-based milestone payments for ARCALYST.

Due to its termination, we do not expect to receive any future payments under the mavrilimumab Huadong Collaboration Agreement.

Huadong will also be obligated to pay us tiered percentage royalties ranging from the low to mid-teens on annual net sales of ARCALYST in the Huadong Territory, subject to certain reductions tied to ARCALYST manufacturing costs and certain other customary reductions, with an aggregate minimum floor.

Royalties will be payable for ARCALYST on a country-by-country or region-by-region basis until the later of (i) 12 years after the first commercial sale of ARCALYST in such country or region in the Huadong Territory, (ii) the date of expiration of the last valid patent claim of our patent rights or any joint collaboration patent rights that covers ARCALYST in such country or region in the Huadong Territory, and (iii) the expiration of the last regulatory exclusivity for ARCALYST in such country or region in the Huadong Territory.

Pursuant and subject to the terms of the Huadong Collaboration Agreements, Huadong has the exclusive right to conduct Huadong Territory-specific development activities for ARCALYST in the Huadong Territory, the first right to support global development of ARCALYST by serving as the sponsor of the global clinical trials conducted in the Huadong Territory and the exclusive right to commercialize ARCALYST in the Huadong Territory.

Huadong will be responsible for all costs of development activities and commercialization in the Huadong Territory.

We and Huadong participate in a joint steering committee, which coordinates and oversees the exploitation of the Huadong Licensed Products in the Huadong Territory.

We will supply certain materials to support development and commercialization activities for both mavrilimumab and ARCALYST.

Under the Huadong Collaboration Agreement for mavrilimumab, Huadong has the right to assume manufacturing responsibilities for materials in the Huadong Territory.

Under the Huadong Collaboration Agreement for ARCALYST, Huadong does not have rights to perform manufacturing activities in the Huadong Territory.

Absent early termination, each Huadong Collaboration Agreement will continue on a country-by-country or region-by-region basis until there are no more royalty payments owed to us in such country or region for the applicable Huadong Licensed Product.

Huadong has the right to terminate each Huadong Collaboration Agreement at its discretion upon 12 months’ notice and either party may terminate the applicable Huadong Collaboration Agreement in the event of an uncured material breach of the other party or in the case of insolvency of the other party.

In addition, we may terminate the applicable Huadong Collaboration Agreement if Huadong or its affiliates or sublicensees challenges the scope, validity, or enforceability of our patent rights being licensed to Huadong.

If Huadong and its affiliates do not conduct any material development or commercialization activities with respect to a Huadong Licensed Product in the People’s Republic of China for a continuous period of longer than six months, then, subject to certain exceptions, we may terminate the Huadong Collaboration Agreement applicable to such Huadong Licensed Product with 60 days’ prior written notice.

In addition, Huadong’s rights under each Huadong Collaboration Agreement in certain regions within the Huadong Territory may be subject to termination upon failure by Huadong to perform certain clinical, development or commercialization activities, as applicable, with respect to the applicable Huadong Licensed Product in such regions.

We and Huadong participate in a joint steering committee, which coordinates and oversees the exploitation of ARCALYST in the Huadong Territory.

We will supply certain materials to support development and commercialization activities for ARCALYST.

Absent early termination, the ARCALYST Huadong Collaboration Agreement will continue on a country-by-country or region-by-region basis until there are no more royalty payments owed to us in such country or region.

Huadong has the right to terminate the ARCALYST Huadong Collaboration Agreement at its discretion upon 12 months’ notice and either party may terminate the ARCALYST Huadong Collaboration Agreement in the event of an uncured material breach of the other party or in the case of insolvency of the other party.

In addition, we may terminate the ARCALYST Huadong Collaboration Agreement if Huadong or its affiliates or sublicensees challenges the scope, validity, or enforceability of our patent rights being licensed to Huadong.

If Huadong and its affiliates do not conduct any material development or commercialization activities for ARCALYST in the People’s Republic of China for a continuous period of longer than six months, then, subject to certain exceptions, we may terminate the ARCALYST Huadong Collaboration Agreement with 60 days’ prior written notice.

In addition, Huadong’s rights under the ARCALYST Huadong Collaboration Agreement in certain regions within the Huadong Territory may be subject to termination upon failure by Huadong to perform certain clinical, development or commercialization activities, as applicable, in such regions.

In-Licensing Agreements

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Under the Regeneron Agreement, we paid $32.5 million in connection with upfront fees and the achievement of regulatory milestones.

We evenly split profits on sales of ARCALYST with Regeneron , where profits are determined after deducting from net sales of ARCALYST certain costs related to the manufacturing and commercialization of ARCALYST.

We evenly split profits on sales of ARCALYST with Regeneron , where profits are determined

after deducting from net sales of ARCALYST certain costs related to the manufacturing and commercialization of ARCALYST.

Such costs include but are not limited to (i) our cost of goods sold for product used, sold or otherwise distributed for patient use by us;

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We also evenly split with Regeneron any proceeds received by us from any licensees, sublicensees and distributors in consideration for the sale, license or other disposition of rights with respect to ARCALYST, including upfront payments, milestone payments and royalties.

Regeneron has a right of first negotiation over our engagement of any third party to support our promotional activities in excess of a specified level and over the assignment or sale of our rights to any product we develop under the Regeneron Agreement to a third party.

In addition, we will need Regeneron’s prior written consent for the sublicense of certain rights to a third party, provided that such consent shall not be unreasonably withheld, conditioned or delayed with respect to the sublicensing of rights outside of the United States.

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License Agreement with MedImmune

In December 2017, we entered into a license agreement with MedImmune (the “MedImmune Agreement”), pursuant to which MedImmune granted us an exclusive, sublicensable, worldwide license to certain intellectual property rights to make, use, develop and commercialize mavrilimumab and any other product containing an antibody to the GM-CSF receptor alpha that is covered by certain MedImmune patent rights for all indications.

We also acquired

non-exclusive licenses to other MedImmune technology for use in exploiting licensed products.

We also acquired reference rights to relevant manufacturing and regulatory documents, and MedImmune’s existing inventory of mavrilimumab drug substance and product.

We are obligated to use commercially reasonable efforts to develop and commercialize the licensed products.

In December 2017, we entered into a license agreement with MedImmune (subsequently acquired by AstraZeneca PLC) (the “MedImmune Agreement”), pursuant to which MedImmune granted us an exclusive, sublicensable, worldwide license to certain intellectual property rights to make, use, develop and commercialize mavrilimumab and any other product containing an antibody to the GM-CSF receptor alpha that is covered by certain MedImmune patent rights for all indications.

We also acquired non-exclusive licenses to other MedImmune technology for use in exploiting licensed products.

We also acquired reference rights to relevant manufacturing and regulatory documents, and MedImmune’s existing supply of mavrilimumab drug substance and product.

We were obligated to use commercially reasonable efforts to develop and commercialize the licensed products.

In February 2025, we delivered a notice of termination to MedImmune, notifying them of our intent to terminate for convenience the MedImmune Agreement effective May 22, 2025.

Following such termination effective date, the rights and licenses granted to us by MedImmune pursuant to the MedImmune Agreement will terminate.

Under the MedImmune Agreement, we paid a total of $23.0 million in connection with upfront fees, a pass-through payment and milestone payment related to the achievement of specified clinical milestones.

We are also obligated to make future clinical, regulatory and initial sales milestone payments of up to $57.5 million in the aggregate for the first two indications.

In addition, we are also obligated to make future clinical and regulatory milestone payments of up to $15.0 million in the aggregate for each subsequent indication.

In July 2020, we entered into an amendment to the MedImmune Agreement to establish a new coronavirus field and defer the payment of certain development and regulatory milestones as applied to the new coronavirus field.

We are obligated to make milestone payments to MedImmune of up to $85.0 million upon the achievement of annual net sales thresholds up to, but excluding, $1.0 billion in annual net sales as well as additional milestone payments aggregating up to $1.1 billion upon the achievement of additional specified annual net sales thresholds starting at $1.0 billion and higher.

Commencing on the first commercial sale of licensed products, we are obligated to pay tiered royalties on escalating tiers of annual net sales of licensed products starting in the low double-digit percentages and ending at twenty percent.

We must pay such royalties on a product-by-product and country-by-country basis until the latest to occur of the expiration of licensed patents, the expiration of regulatory exclusivity or the tenth anniversary of first commercial sale of such product in such country.

Royalty rates are subject to reductions upon certain events.

The MedImmune Agreement will remain in effect until the expiration of the royalty term in the last country for the last indication, as defined in the agreement.

Either party may terminate the MedImmune Agreement upon the other party’s insolvency or bankruptcy or for material breach by the other party that remains uncured for 90 days.

MedImmune has the right to terminate the MedImmune agreement if we challenge any of the licensed patent rights.

We may terminate the agreement at any time upon 90 days’ prior written notice.

Biogen Asset Purchase Agreement

In September 2016, we entered into an asset purchase agreement (the “Biogen Agreement”) with Biogen MA Inc.

(“Biogen”) to acquire all of Biogen’s right, title and interest in and to certain assets used in or relating to vixarelimab and other antibodies covered by certain patent rights, including patents and other intellectual property rights, clinical data, certain contracts, know-how and inventory (the “Acquired Biogen Assets”).

In addition, Biogen granted us a non-exclusive, sublicensable, worldwide license to certain background patent rights related to the vixarelimab program.

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We have also agreed to pay certain obligations under third party contracts retained by Biogen that relate to vixarelimab.

sell the Acquired Biogen Assets, including through the sale of our company, or out-license the rights to the Biogen Antibody Products.

Under the Biogen Agreement, Biogen has a time-limited right of first negotiation to purchase the assets we acquired from Biogen or obtain a license to exploit Biogen Antibody Products, in each case, in the event we decide to sell the Acquired Biogen Assets, including through the sale of our company, or out-license the rights to the Biogen Antibody Products.

Biogen waived such right in connection with the Genentech License Agreement.

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Our success depends in part on our ability to obtain and maintain proprietary protection for our drug candidates, manufacturing and process discoveries, and other know-how, to operate without infringing the proprietary rights of others, and to prevent others from infringing our proprietary rights.

We plan to protect our proprietary position using a variety of methods, which include pursuing United States and foreign patent applications related to our proprietary technology, inventions and improvements, including compositions of matter, drug product formulations, methods of use and methods of manufacture, that are important to the development and implementation of our business.

For example, we or our licensors have or are pursuing patents covering the composition of matter for each of our product candidates and we generally pursue patent protection covering methods of use for each clinical program.

We plan to protect our proprietary position using a variety of methods, which include pursuing United States and foreign patent applications related to our proprietary technology, inventions and improvements, which can include compositions of matter, drug product formulations, methods of use and methods of manufacture.

We also rely on trade secrets, know-how, continuing technological innovation and potential in-licensing opportunities to develop and maintain our proprietary position.

We have a field-specific exclusive license under the Regeneron Agreement to granted patents and pending applications in the United States and numerous other jurisdictions relating to ARCALYST.

As of December 31, 2023,

the patent rights in-licensed under the Regeneron Agreement relating to our program include three granted patents in the United States and a patent granted in Japan.

As of December 31, 2024, the patent rights in-licensed under the Regeneron Agreement relating to our program include three granted patents in the United States and a patent granted in Japan.

In addition, the patent rights in-licensed under the Regeneron Agreement relating to our program include patent applications that are pending in the United States, Canada, Europe and selected countries in Asia.

A United States patent covering ARCALYST as a composition of matter expired in 2020, and relevant composition of matter patents issued outside of the United States expired in 2023.

Three patents covering methods of using ARCALYST in the treatment of recurrent pericarditis have issued in the United States and have a statutory term that expires in 2038, not including any patent term adjustment.

Four patents covering methods of using ARCALYST in the treatment of recurrent pericarditis have issued in the United States and have a statutory term that expires in 2038, not including any patent term adjustment.

In March 2021, the FDA granted approval for ARCALYST for the treatment of recurrent pericarditis and reduction in risk of recurrence in adults and children 12 years of age and older, which granted us seven years of marketing exclusivity in the United States.

See “— License Agreement with Regeneron ” above for additional information on our rights under the Regeneron Agreement.

See “ Business — In-Licensing Agreements – License Agreement with Regeneron ” above for additional information on our rights under the Regeneron Agreement.

We own pending patent applications relating to KPL-387, which cover formulations and methods of manufacturing KPL-387.

If issued, such patents will have statutory expiration dates in 2045, not including any patent term extensions or adjustments.

We also own a pending patent application covering methods of using KPL-387 in the treatment of recurrent pericarditis.

If issued, patents covering methods of using KPL-387 in treating recurrent pericarditis will have statutory expiration dates in 2046, not including any patent term extensions or adjustments.

If we are successful in obtaining regulatory approval of KPL-387 for the treatment of recurrent pericarditis, we also expect to rely on data exclusivity and orphan exclusivity to protect our market position.

For example, in the United States, a new biologic product receives 12 years of data exclusivity upon receiving regulatory approval.

In the EU, a new product generally receives eight years of data exclusivity and an additional two years of market exclusivity upon regulatory approval.

See “ Business – Government Regulation - Biosimilars and Exclusivity;

Government Regulation - Orphan Drug Designation;

Government Regulations - Regulatory Framework in the European Union - Data and Marketing Exclusivity;

and Government Regulations - Regulatory Framework in the European Union – Orphan Medicinal Products ” below for additional information on regulatory exclusivities.

We own a pending patent application relating to KPL-1161, which covers composition of matter.

If issued, patents covering the composition of matter will have statutory expiration dates in 2046, not including any patent term extensions or adjustments.

We own, via our acquisition of Primatope, granted patents and pending patent applications in the United States and numerous other jurisdictions relating to abiprubart.

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The issued composition of matter patents acquired from Primatope have statutory expiration dates in 2036, not including any patent term extensions or adjustments.

As of December 31, 2023, the patent rights licensed from BIDMC include two patents granted in the United States and 33 patents granted in other jurisdictions, including Canada and selected countries in Europe and Asia.

As of December 31, 2024, the patent rights licensed from BIDMC include two patents granted in the United States and 58 patents granted in other jurisdictions, including Australia, Canada and selected countries in Europe and Asia.

In addition, the patent rights licensed from BIDMC include patent applications pending in the United States, Europe and Canada.

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Patent term extension could extend the expiration date of one patent in the United States and patents in certain other jurisdictions, each in accordance with applicable law.

We have an exclusive license under the MedImmune Agreement to granted patents and pending patent applications in the United States and numerous other jurisdictions relating to mavrilimumab.

These patents and patent applications cover mavrilimumab as a composition of matter and its use.

As of December 31, 2023, the patent rights in-licensed under the MedImmune Agreement relating to our program include three granted patents in the United States and 113 patents granted in other jurisdictions, including Canada, Australia and selected countries in Europe and Asia.

In addition, the patent rights in licensed under the MedImmune Agreement relating to our program include patent applications that are pending in the United States, Europe, Canada, and selected countries in Asia and Latin America.

The composition of matter patents for mavrilimumab generally have statutory expiration dates in 2027, although the term of some United States patents may be longer due to patent term adjustment to compensate for delays during the patent prosecution process.

Patent term extension could extend the expiration date of one patent in the United States and patents in certain other jurisdictions, each in accordance with applicable law.

See “ —License agreement with MedImmune ” above for additional information on our rights under the MedImmune Agreement.

Other Intellectual Property

In addition to the above, we maintain certain other intellectual property, including trademarks and know-how, related to our pre-clinical development and broader Kiniksa brand.

In addition to the above, we maintain certain other intellectual property, including patents, trademarks and know-how, related to our pre-clinical development and broader Kiniksa brand.

There can be no assurances that patents will issue from any of our pending patent applications or that any of our existing patents may be extended.

See “ Risk Factors—Risks Related to Intellectual Property— If we are unable to adequately protect our proprietary technology or obtain and maintain patent protection for our technology and products, if the scope of the patent protection obtained is not sufficiently broad, or if the terms of our patents are insufficient to protect our product candidates for an adequate amount of time, our competitors could develop and

commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and products may be materially impaired .”

In the future, if and when our drug candidates receive approval by the FDA or comparable regulatory authorities in other jurisdictions (as applicable, “regulatory authorities”), provided the legal requirements are met, we expect to apply for patent term extensions on issued patents covering those drugs, depending upon the length of the clinical trials for each drug and other factors.

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The process required by the FDA before a biologic may be marketed in the United States generally involves the following:

● Completion of extensive preclinical studies and tests in accordance with applicable regulations, including Good Laboratory Practice (“GLP”), regulations and applicable requirements for the humane use of laboratory animals or other applicable regulations;

● Completion of extensive preclinical tests, animal studies, and toxicology, pharmacology and formulation studies in accordance with applicable regulations, including Good Laboratory Practice (“GLP”) regulations;

● Submission to FDA of an investigational new drug application (an “IND”) which must become effective before human clinical trials may begin;

● Approval by an independent institutional review board (an “IRB”), or ethics committee at each clinical trial site before each trial may be initiated;

● Performance of adequate and well-controlled human clinical trials in accordance with applicable IND regulations, Good Clinical Practices (“GCPs”) and other clinical trial related regulations to evaluate the safety and efficacy of the investigational product for each proposed indication;

● Submission to FDA of a BLA for marketing approval that includes substantive evidence of safety, purity, and potency from results of preclinical testing and clinical trials;

● A determination by FDA within 60 days of its receipt of a BLA to file the application for review;

● Satisfactory completion of one or more FDA pre-approval inspections of the manufacturing facility or facilities where the biologic will be produced to assess compliance with cGMPs to assure that the facilities, methods and controls used in product manufacture are adequate to preserve the biologic’s identity, strength, quality and purity;

● Potential FDA audit of the preclinical or clinical trial sites that generated the data in support of the BLA;

● Payment of user fees for FDA review of the BLA;

● FDA review and approval of the BLA, including satisfactory completion of an FDA advisory committee review, if applicable, prior to any commercial marketing or sale of the product in the United States.

Preclinical Studies and CMC Evaluations

● Approval by an independent institutional review board (an “IRB”) overseeing each clinical trial site, in each case before a trial may be initiated;

● Performance of adequate and well-controlled human clinical trials in accordance with Good Clinical Practices (“GCPs”) and other clinical trial related regulations to evaluate the safety and efficacy of the product candidate for each proposed indication;

● Submission to FDA of a BLA for marketing approval after completion of the required pivotal clinical trials;

● Satisfactory completion of any FDA pre-approval inspections of the manufacturing facility or facilities where the product will be produced to assess compliance with cGMPs;

● FDA review and approval of the BLA.

Preclinical Studies

Before testing any biological product candidate, including our product candidates, in humans, the product candidate must undergo rigorous preclinical testing.

The preclinical development stage generally involves laboratory evaluations of the chemistry, formulation and stability of the product candidate, as well as trials to evaluate toxicity in animals, which support subsequent clinical testing.

The preclinical development stage generally involves laboratory evaluations of the chemistry, formulation and stability of the product candidate, as well as animal trials to evaluate toxicity.

The conduct of the preclinical tests must comply with federal regulations and requirements, including GLP regulations.

The sponsor must submit the results of the preclinical studies, together with chemistry manufacturing and controls (“CMC”), information, analytical data, any available clinical data or literature and a proposed clinical protocol, to the FDA as part of the IND.

An IND is a request for authorization from the FDA to administer an investigational product to humans and must become effective before human clinical trials may begin.

An IND automatically becomes effective 30 days after receipt by the FDA, unless before that time the FDA raises concerns or questions related to CMC issues, preclinical issues, or one or more issues in the proposed clinical trials and places the clinical trial on a clinical hold.

In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin.

The FDA also may place the IND on partial clinical hold, and a proposed study may only be partially executable, including due to FDA restrictions.

Some preclinical testing may continue even after the IND is submitted.

The sponsor must submit the results of the preclinical studies as part of an IND, along with other information, including information about chemistry, manufacturing and controls (“CMC”).

An IND automatically becomes effective 30 days after receipt by the FDA, unless before that time the FDA places the clinical trial on hold and the IND sponsor must resolve any outstanding issues before clinical trials can proceed.

Clinical Trials

The clinical stage of development involves the administration of the investigational product to healthy volunteers or participants under the supervision of qualified investigators, generally physicians not employed by, or under control of, the trial sponsor, in accordance with GCPs, which include the requirement that all research subjects provide their informed consent for their participation in any clinical trial.

Clinical trials are conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, subject selection and inclusion/exclusion criteria and the parameters to be used to monitor subject safety and assess efficacy.

Clinical trials involve the administration of the investigational product to normal healthy volunteers or participants under the supervision of qualified investigators.

Clinical trials must be conducted in accordance with GCPs, which include the requirement that all research subjects provide their informed consent for their participation in any clinical trial.

Clinical trials also must be conducted under protocols detailing, among other things, the objectives of the clinical trial, dosing procedures, participant selection and inclusion/exclusion criteria and the parameters to be used to monitor subject safety and assess efficacy.

Each protocol, and any subsequent amendments to the protocol, must be submitted to the FDA as part of the IND.

Furthermore, an IRB representing each institution at which the clinical trial will be conducted must review and approve the plan for any clinical trial, including, among other things, the protocol and informed consent information to be provided to clinical trial subjects or their legal representatives, to ensure that the risks to individuals participating in the clinical trials are minimized and are reasonable in relation to anticipated benefits.

risks to individuals participating in the clinical trials are minimized and are reasonable in relation to anticipated benefits.

The IRB also must monitor the clinical trial until completed.

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Human clinical trials are typically conducted in three sequential phases, which may overlap or be combined.

● Phase 1 clinical trials generally involve a small number of healthy participants, or in the case of product candidates for severe or life-threatening diseases, including rare diseases, participants with the target disease or condition who are initially exposed to a single dose and then multiple doses of the product

● Phase 1 clinical trials generally involve a small number of healthy participants.

The primary purpose of these clinical trials is to assess the metabolism, pharmacologic action, tolerability and safety of the drug.

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● Phase 3 clinical trials generally involve a larger number of participants at multiple, geographically dispersed clinical trial sites and are designed to provide the data necessary to demonstrate the effectiveness of the product candidate for its intended use, its safety in use and to establish the overall benefit/risk relationship of the product candidate and provide an adequate basis for product labeling and approval.

These trials may include comparisons with placebo or other comparator treatments.

The duration of treatment is often extended to mimic the actual use of a product during marketing.

Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval.

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In certain instances, the FDA may mandate the performance of Phase 4 clinical trials as a condition of approval of a BLA.

Concurrently with clinical trials, companies usually complete additional preclinical studies and must also develop additional information about the physical characteristics of the biological product as well as finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements.

To help reduce the risk of the introduction of adventitious agents with use of biological products, the PHSA emphasizes the importance of manufacturing control for products whose attributes cannot be precisely defined.

The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, the sponsor must develop methods for testing the identity, strength, quality, potency and purity of the final biological product.

Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the biological product candidate does not undergo unacceptable deterioration over its shelf life.

BLA Review and Approval

Assuming successful completion of the required clinical testing, the results of the preclinical studies and clinical trials, together with detailed information relating to the product’s chemistry, manufacture, controls (collectively, “CMC”) and proposed labeling, among other things, are submitted to the FDA as part of a BLA requesting approval to market the product for one or more indications.

The BLA must contain substantial evidence supporting the safety, purity, potency (or efficacy) of the product candidate and may include both negative and ambiguous results of preclinical studies and clinical trials as well as positive findings.

Data may come from company sponsored clinical trials intended to test the safety and efficacy of a product candidate’s use or from a number of alternative sources, including studies initiated by investigators.

To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety, purity and potency (or efficacy) of the investigational product to the satisfaction of the FDA.

Assuming successful completion of the required clinical testing, the results of the preclinical studies and clinical trials, together with detailed information relating to the product’s CMC and proposed labeling, among other things, are submitted to the FDA as part of a BLA requesting marketing approval for a product for one or more indications.

To support marketing approval, the data submitted from company sponsored clinical trials or potentially other alternative sources must be sufficient in quality and quantity to establish the safety, purity and potency (or efficacy) of the investigational product to the satisfaction of the FDA.

In relevant cases, the BLA must include data relevant to safety, efficacy and dosing for pediatric populations.

FDA approval of a BLA must be obtained before a biologic may be marketed in the United States.

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Within 60 days following submission of the application, the FDA reviews all BLAs submitted to ensure that they are sufficiently complete for substantive review before it accepts them for filing.

The FDA may request additional information rather than accept an BLA for filing.

In this event, the BLA must be resubmitted with the additional information.

The resubmitted application also is subject to review before the FDA accepts it for filing.

The FDA may require the sponsor to provide additional information before accepting the BLA for filing.

Once the BLA submission is accepted for filing, the FDA begins an in-depth substantive review.

The FDA reviews a BLA to determine, among other things, whether the product is safe, pure and potent and the facility in which it is manufactured, processed, packed or held meets standards designed to assure the product’s continued safety, purity and potency.

Under the goals and policies agreed to by the FDA under the Prescription Drug User Fee Act (the “PDUFA”), for original BLAs, the FDA has ten months from the filing date in which to complete its initial review of a standard application and respond to the applicant, and six months from the 60-day filing date for an application with priority review.

This review typically takes twelve

months from the date the BLA is submitted to the FDA because the FDA has approximately two months to make a “filing” decision.

The FDA does not always meet its PDUFA goal dates, and the review process may be extended by FDA requests for additional information or clarification.

Before approving a BLA, the FDA will typically conduct a pre-approval inspection of the manufacturing facilities for the new product to determine whether the manufacturing processes and facilities comply with cGMPs.

The FDA will not approve the product unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications.

Most BLAs are reviewed within ten months from the filing date or six months from the 60-day filing date for BLAs with priority review, subject in each case to extensions by the FDA.

are adequate to ensure consistent product production within required specifications.

The FDA also may inspect the sponsor and one or more clinical trial sites to assure compliance with GCP requirements and the integrity of the clinical data submitted to the FDA.

Additionally, the FDA may refer applications for novel biologic candidates which present challenges in interpretation of the safety or efficacy data to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved and under what conditions, if any.

The FDA is not bound by recommendations of an advisory committee, but it considers such recommendations when making decisions on approval.

The FDA likely will re-analyze the clinical trial data, which could result in extensive discussions between the FDA and the applicant during the review process.

Under the Pediatric Research Equity Act (“PREA”), a BLA or supplement to a BLA must contain data that are adequate to assess the safety and efficacy of the product candidate for the claimed indications in all relevant pediatric populations and to support dosing and administration for each pediatric population for which the product is safe and effective.

The FDA may grant deferrals for submission of pediatric data or full or partial waivers.

Sponsors must submit an initial Pediatric Study Plan (a “iPSP”) that includes an outline of the pediatric study or studies that the sponsor plans to conduct, including trial objectives and design, age groups, relevant endpoints and statistical approach, or a justification for not including such detailed information, and any request for a deferral of pediatric assessments or a full or partial waiver of the requirement to provide data from pediatric studies along with supporting information.

The FDA and the sponsor must reach an agreement on the iPSP.

A sponsor can submit amendments to an agreed upon initial iPSP at any time if changes to the pediatric plan need to be considered based on data collected from preclinical studies, early phase clinical trials or other clinical development programs.

The FDA reviews a BLA to determine, among other things, whether the product candidate is safe and effective for its intended use and whether its manufacturing is cGMP-compliant to assure and preserve the product candidate’s identity, strength, quality and purity.

The approval process is lengthy and difficult, and the FDA may refuse to approve a BLA if the applicable regulatory criteria are not satisfied or may require additional clinical or other data and information.

Additionally, the FDA may refer applications for novel biologic candidates, which present challenges in interpretation of the safety or efficacy data, to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved.

The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations when making decisions on approval.

The BLA approval process is lengthy and difficult, and the FDA may refuse to approve a BLA if the applicable regulatory criteria are not satisfied or may require additional clinical or other data and information.

After the FDA evaluates a BLA, it will issue an approval letter or a Complete Response Letter (“CRL”).

An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications.

A CRL indicates that the review cycle of the application is complete and the application will not be approved in its present form.

A CRL usually describes all of the specific deficiencies in the BLA identified by the FDA.

The CRL may require additional clinical or other data, additional clinical trial(s) or other significant and time-consuming requirements related to clinical trials, preclinical studies or manufacturing.

If a CRL is issued, the applicant may either resubmit the BLA, addressing all of the deficiencies identified in the letter, or withdraw the application.

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

A CRL indicates the deficiencies in the submission and may require substantial additional testing or information for the FDA to reconsider the BLA.

If and when the deficiencies have been addressed to the FDA’s satisfaction, the FDA will issue an approval letter.

Even if such data and information are submitted, the FDA may decide that the re-submitted BLA does not satisfy the criteria for approval.

If a product receives regulatory approval, the approval is limited to the conditions of use (e.g., patient population, indication) described in the FDA-approved labeling.

Further, depending on the specific risk(s) to be addressed, the FDA may require that contraindications, warnings or precautions be included in the product labeling, require that post-approval trials, including Phase 4 clinical trials, be conducted to further assess a product’s safety after approval, require testing and surveillance programs to monitor the product after commercialization, or impose other conditions, including distribution and use restrictions or other risk management mechanisms under a risk evaluation and mitigation strategy (“REMS”), which can materially affect the potential market and profitability of the product.

FDA approval authorizes commercial marketing of a drug or biologic product with specific prescribing information and for specific indications.

As a condition of approval, the FDA may require, among other things, post-approval trials or testing and surveillance programs to monitor the product after commercialization or implementation of a risk evaluation and mitigation strategy (“REMS”) to ensure the benefits of the product outweigh the potential risks.

The FDA may prevent or limit further marketing of a product based on the results of post-marketing trials or surveillance programs, or new safety findings after market introduction.

After approval, some types of changes to the approved

product, such as adding new indications, manufacturing changes and additional labeling claims, are subject to further testing requirements and FDA review and approval.

After approval, certain changes to the approved product, such as adding new indications, manufacturing changes and additional labeling claims, are subject to further testing requirements and FDA review and approval.

Orphan Drug Designation

Under the Orphan Drug Act, the FDA may grant orphan designation to a drug or biologic product intended to treat a rare disease or condition, which is generally a disease or condition that affects fewer than 200,000 individuals in the United States or more than 200,000 individuals in the United States and for which there is no reasonable expectation that the cost of developing and making the product available in the United States for this type of disease or condition will be recovered from sales of the product.

Orphan Drug designation must be requested by the sponsor before submitting a BLA.

After the FDA grants Orphan Drug designation, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA.

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Orphan Drug designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers.

In addition, if a product that has orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to Orphan Drug exclusivity, which means that the FDA may not approve any other applications to market the same drug for the same indication for seven years from the date of such approval, except in limited circumstances, such as a showing of clinical superiority to the product with orphan exclusivity by means of greater effectiveness, greater safety, by providing a major contribution to patient care or in instances of drug supply issues.

A designated Orphan Drug may not receive Orphan Drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan designation.

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The designation includes all of the Fast Track program features, as well as more intensive FDA interaction and guidance beginning as early as Phase 1 and an organizational commitment to expedite the development and review of the product candidate, including involvement of senior managers.

The FDA may designate a product candidate is eligible for priority review if the product candidate is designed to treat a serious condition, and if approved, would provide a significant improvement in safety or effectiveness compared to marketed products.

The FDA will attempt to direct additional resources to the evaluation of an application for a biologic designated for priority review in an effort to facilitate the review.

The FDA endeavors to review original

BLAs with priority review designations within six months of the filing date as compared to ten months under its standard review goals.

In addition, a product candidate intended to treat serious or life-threatening diseases or conditions may be eligible for accelerated approval upon a determination that the product candidate has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments.

As a condition of approval, the FDA generally requires that a sponsor of a drug receiving accelerated approval perform adequate and well-controlled confirmatory clinical trials to verify the predicted clinical benefit.

A product candidate intended to treat serious or life-threatening diseases or conditions may be eligible for accelerated approval upon a determination that the product candidate has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments.

As a condition of approval, the FDA generally requires that a sponsor of a product receiving accelerated approval perform adequate and well-controlled confirmatory clinical trials to verify the predicted clinical benefit.

A product that receives accelerated approval may be subject to expedited withdrawal procedures if the sponsor fails conduct the required confirmatory trials in a timely manner or if such trials fail to verify the predicted clinical benefit.

In addition, the FDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the timing of the commercial launch of the product.

The FDA may designate a product candidate for priority review if the product candidate is designed to treat a serious condition, and if approved, would provide a significant improvement in safety or effectiveness compared to marketed products.

The FDA will attempt to direct additional resources to the evaluation of an application for a biologic designated for priority review in an effort to facilitate the review.

The FDA endeavors to review original BLAs with priority review designations within six months of the filing date as compared to ten months under its standard review goals.

Even if a product qualifies for one or more of these programs, the FDA may later decide that the product no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.

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Post-approval Requirements

Following approval of a new product, the manufacturer and the approved product are subject to pervasive and continuing regulation by the FDA, including, among other things, monitoring and recordkeeping activities, reporting of adverse experiences with the product, product sampling and distribution restrictions, complying with promotion and advertising requirements, which include restrictions on promoting drugs for unapproved uses or patient populations (i.e., “off-label use”) and limitations on industry-sponsored scientific and educational activities.

Although physicians may prescribe legally available products for off-label uses, manufacturers may not market or promote such uses.

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

If there are any modifications to the product, including changes in indications, labeling or manufacturing processes or facilities, the applicant may be required to submit and obtain FDA approval of a new BLA or BLA supplement, which may require the applicant to develop additional data or conduct additional preclinical studies and clinical trials.

The FDA may also place other conditions on approvals including the requirement for a REMS to assure the safe use of the product.

A REMS could include medication guides, physician communication plans or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.

Any of these limitations on approval or marketing could restrict the commercial promotion, distribution, prescription or dispensing of products.

Product approvals may be withdrawn for non-compliance with regulatory standards or if problems occur following initial marketing.

FDA regulations require that products be manufactured in specific approved facilities and in accordance with cGMPs.

We rely, and expect to continue to rely, on third parties for the production of clinical and commercial quantities of our products in accordance with cGMP regulations.

These manufacturers must comply with cGMP regulations that require, among other things, quality control and quality assurance, the maintenance of records and documentation and the obligation to investigate and correct any deviations from cGMP.

Manufacturers and other entities involved in the manufacture and distribution of approved drugs or biologics are required to register their establishments with the FDA and certain state agencies and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP and other laws.

Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain cGMP compliance.

The discovery of conditions that violate these rules, including failure to conform to cGMPs, could result in enforcement actions, and the discovery of problems with a product after approval may result in restrictions on a product, manufacturer or holder of an approved BLA, including voluntary recall.

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

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

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

or imposition of distribution or other restrictions under a REMS program.

Other potential consequences include, among other things:

Once a BLA is approved, a product will be subject to certain post-approval requirements.

For instance, the FDA closely regulates the post-approval marketing and promotion of drugs and biologics, including standards and regulations for direct-to-consumer advertising, off-label promotion, industry-sponsored scientific and educational activities and promotional activities involving the internet and social media.

Drugs and biologics may be marketed only for the approved indications and in accordance with the provisions of the approved labeling.

Adverse event reporting and submission of periodic reports are required following FDA approval of a BLA.

In addition, FDA regulations require that products be manufactured in specific approved facilities and in accordance with cGMPs.

We rely, and expect to continue to rely, on third party CDMOs for the production of clinical and commercial quantities of our products in accordance with cGMP regulations.

We, and our CDMOs are required to

Registration with the FDA subjects us and our CDMOs to periodic unannounced inspections by the FDA, during which the agency inspects manufacturing facilities to assess compliance with cGMPs.

Accordingly, we and our CDMOs must continue to expend time, money and effort in the areas of production and quality-control to maintain compliance with cGMPs.

Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or failure to comply with regulatory requirements, may result in, among other things:

● restrictions on the marketing or manufacturing of the product, complete withdrawal of the product from the market or product recalls;

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An abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product was created by the Biologics Price Competition and Innovation Act of 2009 (the “BPCIA”) as part of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (the “ACA”).

Under the BPCIA, a manufacturer may submit an application for a biological product that is “biosimilar to” or “interchangeable with” a previously approved biological product or “reference product.” Biosimilarity, which requires that the biological product be highly similar to the reference product notwithstanding minor differences in clinically inactive components and that there be no clinically meaningful differences between the product and the reference product in terms of safety, purity and potency, must be shown through analytical studies, animal studies and a clinical trial or trials.

Interchangeability requires that a biological product be biosimilar to the reference product and that the product can be expected to produce the same clinical results as the reference product in any given patient and, for products administered multiple times to an individual, that the product and the reference product may be alternated or switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biological product without such alternation or switch.

Under the BPCIA, a manufacturer may submit an application for a biological product that is “biosimilar to” or “interchangeable with” a previously approved “reference product.” Biosimilarity requires that the biological product be highly similar to the reference product and that there be no clinically meaningful differences in safety, purity and potency.

This must be demonstrated through analytical studies, animal studies and a clinical trial or trials.

In order to meet the higher hurdle of interchangeability, a sponsor must demonstrate that the biosimilar product can be expected to produce the same clinical result as the reference product, and for a product that is administered more than once, that the risk of switching between the reference product and biosimilar product is not greater than the risk of maintaining the patient on the reference product.

Under the BPCIA, a reference biological product is granted 12 years of data exclusivity from the time of first licensure of the product, and the FDA will not accept an application for a biosimilar or interchangeable product based on the reference biological product until four years after the date of first licensure of the reference product.

“First licensure” typically means the initial date the particular product at issue was licensed in the United States.

Date of first licensure does not include the date of licensure of (and a new period of exclusivity is not available for) a supplement for the reference product for a subsequent application filed by the same sponsor or manufacturer of the reference product (or licensor, predecessor in interest or other related entity) for a change (not including a modification to the structure of the biological product) that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device or strength or for a modification to the structure of the biological product that does not result in a change in safety, purity or potency.

Therefore, one must determine whether a new product includes a modification to the structure of a previously licensed product that results in a change in safety, purity or potency to assess whether the licensure of the new product is a first licensure that triggers its own period of exclusivity.

Whether a subsequent

application, if approved, warrants exclusivity as the “first licensure” of a biological product is determined on a case-by-case basis with data submitted by the sponsor.

Foreign Government Regulation

In addition to regulations in the United States, we are subject to a variety of regulations in other jurisdictions governing, among other things, clinical trials, marketing authorization, post-marketing requirements and any commercial sales and distribution of our product candidates.

As in the United States, medicinal products can be marketed only if a marketing authorization from the competent regulatory agencies has been obtained whether or not product candidates obtain FDA approval for a pharmaceutical product, we would need to obtain the necessary approvals by the comparable foreign regulatory authorities before we can start clinical trials or marketing of the products in those countries or jurisdictions.

The approval process ultimately varies between countries and jurisdictions and can involve additional product testing and additional administrative review periods.

The product approval process ultimately varies between countries and jurisdictions and can involve additional product testing and additional administrative review periods.

The time required to obtain approval in other countries and jurisdictions might differ from and be longer than that required to obtain FDA approval.

Regulatory approval in one country or jurisdiction does not ensure regulatory approval in another, but a failure or delay in obtaining regulatory approval in one country or jurisdiction may negatively impact the regulatory process in others.

Failure to comply with applicable foreign regulatory requirements, may be subject to, among other things, fines, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

Regulatory Framework in the European Union

Non-Clinical Studies and Clinical Trials

Similar to the United States, the various phases of preclinical and clinical research in the European Union (the “EU”) are subject to significant regulatory controls.

Non-clinical studies are performed to demonstrate the health or environmental safety of new chemical or biological substances.

Non-clinical studies must be conducted in compliance with the principles of GLP, as set forth in EU Directive 2004/10/EC.

In particular, non-clinical studies, both in vitro and in vivo, must be planned, performed, monitored, recorded, reported and archived in accordance with the GLP principles, which define a set of rules and criteria for a quality system for the organizational process and the conditions for non-clinical studies.

These GLP standards reflect the Organization for Economic Co-operation and Development requirements.

Clinical trials of medicinal products in the EU must be conducted in accordance with EU and national regulations and the International Conference on Harmonization (the “ICH”) guidelines on GCP, as well as the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki.

Clinical Trials

Clinical trials of medicinal products in the European Union (“EU”) are governed by the Clinical Trials Regulation (EU) No 536/2014 (the “CTR”), which became applicable on January 31, 2022, and repealed the Clinical Trials Directive.

The CTR is directly applicable in all EU member states without the need for member states to further implement it into national law.

The CTR notably harmonizes the assessment and supervision processes for clinical trials throughout the EU via a Clinical Trials Information System, which contains a centralized EU portal and database.

If the sponsor of the clinical trial is not established within the EU, it must appoint an EU entity to act as its legal representative.

The sponsor must take out a clinical trial insurance policy, and in most EU member states, the sponsor is liable to provide ‘no fault’ compensation to any study subject injured in the clinical trial.

The regulatory landscape related to clinical trials in the EU has been subject to recent changes.

The EU Clinical Trials Regulation (the “CTR”) which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became applicable on January 31, 2022.

Unlike directives, the CTR is directly applicable in all EU member states without the need for member states to further implement it into national law.

While the Clinical Trials Directive required a separate clinical trial application (a “CTA”) to be submitted in each member state, to both the competent national health authority and an independent ethics committee, much like the FDA and IRB respectively, the CTR introduces a centralized process and only requires the submission of a single application to all member states concerned.

The CTR allows sponsors to make a single submission to both the competent authority and an ethics committee in each member state, leading to a single decision per member state.

include, among other things, a copy of the trial protocol and an investigational medicinal product dossier containing information about the manufacture and quality of the medicinal product under investigation.

The CTA must include information concerning the trial protocol and the manufacture and quality of the medicinal product under investigation.

The assessment procedure of the CTA has been harmonized as well, including a joint assessment by all member states concerned, and a separate assessment by each member state with respect to specific requirements related to its own territory, including ethics rules.

Each member state’s decision is communicated to the sponsor via the centralized EU portal.

Once the CTA is approved, clinical study development may proceed.

One of the main aims of EU CTR is to increase transparency about clinical trials, which is done by making documents and data from the CTA publicly available through CTIS at time of decision about the clinical trial.

There are few exceptions to this, and release of personal data and company confidential information is controlled through redaction and through requesting a trial-phase dependent deferral of disclosure.

The CTR foresees a three-year transition period.

The extent to which ongoing and new clinical trials will be governed by the CTR varies.

Clinical trials for which an application was submitted (i) prior to January 31, 2022 under the Clinical Trials Directive, or (ii) between January 31, 2022 and January 31, 2023 and for which the sponsor has opted for the application of the Clinical Trials Directive remain governed by said Directive until January 31, 2025.

After this date, all clinical trials (including those which are ongoing) will become subject to the provisions of the CTR.

Documents and data from the CTA are made publicly available through CTIS at time of decision about the clinical trial, subject to the redaction of personal data and confidential information.

Since January 2025, all clinical trials (including those which are ongoing but approved under the previous legal framework) are subject to the provisions of the CTR.

Medicines used in clinical trials must be manufactured in accordance with cGMP.

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● “National MAs” are issued by the competent authorities of the EU member states, only cover their respective territory, and are available for investigational medicinal products that fall outside the mandatory scope of the centralized procedure.

Where a product has already been authorized for marketing in an EU member state, this national MA can be recognized in another member state through the Mutual Recognition Procedure.

Where a product has already been authorized for marketing in an EU

member state, this national MA can be recognized in another member state through the Mutual Recognition Procedure.

If the product has not received a national MA in any member state at the time of application, it can be approved simultaneously in various member states through the decentralized procedure.

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After these five years, the authorization may be renewed on the basis of a reevaluation of the risk-benefit balance.

Under the centralized procedure and in exceptional cases, the CHMP might perform an accelerated review of a MA in no more than 150 days (not including clock stops).

Moreover, in the EU, a “conditional” MA may be granted in cases where all the required safety and efficacy data are not yet available.

In the EU, a “conditional” MA may be granted in cases where all the required safety and efficacy data are not yet available.

The European Commission may grant a conditional MA for a medicinal product if it is demonstrated that all of the following criteria are met:

(i) the benefit-risk balance of the medicinal product is positive;

(ii) it is likely that the applicant will be able to provide comprehensive data post-authorization;

(iii) the medicinal product fulfils an unmet medical need;

and (iv) the benefit of the immediate availability to patients of the medicinal product is greater than the risk inherent in the fact that additional data are still required.

The conditional MA is subject to conditions to be fulfilled for generating the missing data or ensuring increased safety measures.

It is valid for one year and has to be renewed annually until fulfillment of all the conditions.

Once the pending studies are provided, it can become a “standard” MA.

However, if the conditions are not fulfilled within the timeframe set by the EMA, the MA ceases to be renewed.

Furthermore, MA may also be granted “under exceptional circumstances” when the applicant can show that it is unable to provide comprehensive data on the efficacy and safety under normal conditions of use even after the product has been authorized and subject to specific procedures being introduced.

This may arise in particular when the intended indications are very rare and, in the present state of scientific knowledge, it is not possible to provide comprehensive information, or when generating data may be contrary to generally accepted ethical principles.

This MA is close to the conditional MA as it is reserved to medicinal products to be approved for severe diseases or unmet medical needs and the applicant does not hold the complete data set legally required for the grant of a MA.

However, unlike the conditional MA, the applicant does not have to provide the missing data and will never have to.

Although the MA “under exceptional circumstances” is granted definitively, the risk-benefit balance of the medicinal product is reviewed annually, and the MA is withdrawn in case the risk-benefit ratio is no longer favorable.

It is valid for one year and must be renewed annually until all related conditions have been fulfilled.

Once any pending studies are provided, the conditional MA can be converted into a traditional MA.

However, if the conditions are not fulfilled within the timeframe set by the EMA and approved by the European Commission, the MA will cease to be renewed.

Data and Marketing Exclusivity

The EU also provides opportunities for market exclusivity.

New products authorized for marketing (i.e., reference products) generally receive eight years of data exclusivity and an additional two years of market exclusivity upon receiving MA.

If granted, the data exclusivity period prevents biosimilar applicants from relying on the pre-clinical and clinical trial data contained in the dossier of the reference product when applying for a biosimilar MA in the EU during a period of eight years from the date on which the reference product was first authorized in the EU.

The market exclusivity period prevents a successful biosimilar applicant from commercializing its product in the EU until ten years have elapsed from the initial authorization of the reference product in the EU.

New products authorized for marketing (i.e., reference products) generally receive eight years of data exclusivity and an additional two years of market exclusivity upon receiving an MA.

During the data exclusivity period in the EU, biosimilar applicants may not rely on the pre-clinical and clinical trial data contained in the dossier of the reference product when applying for a biosimilar MA.

During the market exclusivity period in the EU, a biosimilar MAA can be submitted and approved, and data previously covered by data exclusivity may be referenced, but no biosimilar product can be commercialized until the expiration of such period (for a total of ten years of data and market exclusivity).

The overall ten-year market exclusivity period can be extended to a maximum of eleven years if, during the first eight years of those ten years, the MA holder obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies.

However, there is no guarantee that a product will be considered by the EU’s regulatory authorities to be a new chemical entity, and products may not qualify for data exclusivity.

There is a special regime for biosimilars, or biological medicinal products that are similar to a reference medicinal product but that do not meet the definition of a generic medicinal product, for example, because of differences in raw materials or manufacturing processes.

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(2) either (a) such condition affects no more than five in 10,000 persons in the EU when the application is made, or (b) the product, without the benefits derived from orphan status, would not generate sufficient return in the EU to justify investment;

and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition

authorized for marketing in the EU, or if such a method exists, the product will be of significant benefit to those affected by the condition.

The application for Orphan Drug designation must be submitted before the application for MA.

and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU, or if such a method exists, the product will be of significant benefit to those affected

by the condition.

Orphan medicinal products are eligible for financial incentives such as reduction of fees or fee waivers and are, upon grant of a MA, entitled to ten years of market exclusivity for the approved therapeutic indication.

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Similar to the United States, both MA holders and manufacturers of medicinal products are subject to comprehensive regulatory oversight by the EMA, the European Commission and/or the competent regulatory authorities of the EU member states.

The holder of MA for a medicinal product must also comply with pharmacovigilance legislation and its related regulations and guidelines, which entail many requirements for conducting pharmacovigilance, or the assessment and monitoring of the safety of medicinal products.

The holder of a MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance (a “QPPV”) who is

responsible for the establishment and maintenance of that system and oversees the safety profiles of medicinal products and any emerging safety concerns.

The holder of an MA for a medicinal product must also comply with pharmacovigilance legislation and its related regulations and guidelines, which entail many requirements for conducting pharmacovigilance, or the assessment and monitoring of the safety of medicinal products.

The holder of a MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance (a “QPPV”) who is responsible for the establishment and maintenance of that system and oversees the safety profiles of medicinal products

and any emerging safety concerns.

Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports (“PSURs”).

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Failure to comply with EU and national laws that apply to the conduct of clinical trials, manufacturing approval, MA of medicinal products and marketing of such products, both before and after grant of the MA, manufacturing of medicinal products, statutory health insurance, bribery and anti-corruption or with other applicable regulatory requirements may result in administrative, civil or criminal penalties.

These penalties could include delays or refusal to authorize the conduct of clinical trials or to grant MA, product withdrawals and recalls, product seizures, suspension, withdrawal or variation of the marketing authorization, total or partial suspension of production, distribution, manufacturing or clinical trials, operating restrictions, injunctions, suspension of licenses, fines and criminal penalties.

The aforementioned EU rules are generally applicable in the European Economic Area (the “EEA”) (comprised of the 27 EU member states plus Iceland, Liechtenstein and Norway).

Brexit and the Regulatory Framework in the United Kingdom

These penalties could include delays or refusal to authorize the conduct of clinical trials or to grant an MA, product withdrawals and recalls, product seizures, suspension, withdrawal or variation of the MA, total or partial suspension of production, distribution, manufacturing or clinical trials, operating restrictions, injunctions, suspension of licenses, fines and criminal penalties.

Regulatory Framework in the United Kingdom

Since the end of the Brexit transition period on January 1, 2021, Great Britain (England, Scotland and Wales) has not been directly subject to EU laws, however under the terms of the Ireland/Northern Ireland Protocol, EU laws generally apply to Northern Ireland.

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The Windsor Framework corrects this by disapplying EU pharmaceutical law in Northern Ireland and ensuring regulatory continuity between Great Britain and Northern Ireland.

In practice this means that, when these provisions take effect on January 1, 2025, medicinal products destined for sale in both Great Britain and Northern Ireland will be sold under one marketing authorization (MA), and in the same packaging and labelling.

In practice this means that, since these provisions took effect on January 1, 2025, medicinal products destined for sale in both Great Britain and Northern Ireland must be sold under one marketing authorization (MA), and in the same packaging and labelling.

The EU laws that have been transposed into United Kingdom (the “UK”) law through secondary legislation remain applicable in Great Britain.

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As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency (the “MHRA”) is the UK’s standalone medicines and medical devices regulator.

Whilst Northern Ireland will continue to follow the EU regulatory regime, its national competent authority will remain the MHRA.

The MHRA has introduced changes to national licensing procedures, including procedures to prioritize access to new medicines that will benefit patients, including a 150-day assessment and a rolling review procedure.

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promote transparency in interactions with others in the healthcare industry;

require reporting of drug prices and payment of rebates or offering of discounts to certain government programs and public and private payors;

and regulate government payment for drugs.

These laws are enforced by various federal and state enforcement authorities and non-compliance, or alleged non-compliance, with such laws could adversely affect our reputation, our business and our financial results.

See “ Risk Factors – Risks Related to Commercialization- Our business operations are subject to extensive healthcare regulation and enforcement by various government entities, and our failure to strictly adhere to these regulatory requirements could have a detrimental impact on our business .” Similar laws exist in foreign jurisdictions, including the EU, as well.

prohibit anyone from knowingly and willingly presenting, or causing to be presented, any false or fraudulent claims for payment for reimbursed drugs or services to third party payors, including Medicare and Medicaid).

Similar laws exist in foreign jurisdictions, including the EU, as well.

We may be subject to various federal and state laws pertaining to health care “fraud and abuse,” including anti-kickback laws (which typically prohibit soliciting, offering, receiving, or paying anything of value to generate healthcare business reimbursable by third party payors, including Medicare and Medicaid), and false claims laws (which generally prohibit anyone from knowingly and willingly presenting, or causing to be presented, any false or fraudulent claims for payment for reimbursed drugs or services to third party payors, including Medicare and Medicaid).

Although the specific provisions of these laws vary, their scope is generally broad and there may not be regulations, guidance, or court decisions that apply the laws to particular industry practices.

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We may need to obtain and maintain licenses for our manufacturing and distribution activities in the states in which we operate or distribute our products.

Moreover, analogous foreign laws and regulations may be broader in scope than the provisions described above and may apply regardless of payor.

These laws and regulations may differ from one another in significant ways, thus further complicating compliance efforts.

For instance, in the EU, many EU member states have adopted specific anti-gift statutes that further limit commercial practices for medicinal products, in particular vis-à-vis healthcare professionals and organizations.

In the EU, many EU member states have adopted specific anti-gift statutes that further limit commercial practices for medicinal products, in particular vis-à-vis healthcare professionals and organizations.

Additionally, there has been a recent trend of increased regulation of payments and transfers of value provided to healthcare professionals or entities and many EU member states have adopted national laws which impose requirements to disclose financial interactions with healthcare professionals to the government and public (often on an annual basis), similar to the requirements in the United States, on pharmaceutical companies.

Certain countries also mandate implementation of commercial compliance programs or require disclosure of marketing expenditures and pricing information.

Given that the scope of these laws is often broad and government interpretation and enforcement of these laws is constantly evolving, we cannot be certain that our activities will not be challenged.

Federal and state enforcement bodies have recently increased their scrutiny of interactions between healthcare companies and healthcare professionals, which has led to a number of investigations, prosecutions, convictions and settlements in the healthcare industry.

Ensuring that business arrangements with third parties comply with applicable healthcare laws and regulations is costly and time consuming.

If business operations are found to be in violation of any of the laws described above or any other applicable governmental regulations a pharmaceutical manufacturer may be subject to penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement of profits, individual imprisonment of executive officers and employees of such companies, exclusion from governmental funded healthcare programs, such as Medicare and Medicaid, contractual damages, reputational harm, diminished profits and future earnings, additional reporting obligations and oversight if subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws, and curtailment or restructuring of operations, any of which could adversely affect a pharmaceutical manufacturer’s ability to operate its business and the results of its operations.

Coverage, Pricing and Reimbursement

Significant uncertainty exists as to the coverage and reimbursement status of any approved biological products.

The United States government, state legislatures and governments outside the United States have shown significant interest in implementing cost containment programs to limit the growth of government-paid healthcare costs, including price-controls, restrictions on reimbursement and requirements for substitution of biosimilar products for branded drug and biologic products.

In the United States and markets in other countries, patients who are prescribed products generally rely on third party payors to reimburse all or a substantial part of the associated healthcare costs.

Providers and patients are unlikely to use our products unless coverage is provided and reimbursement is adequate to cover a substantial portion of the cost of our products.

For products administered under the supervision of a physician, obtaining coverage and adequate reimbursement may be particularly difficult because of the higher prices often associated with such drugs.

If approved, sales of our product candidates will depend, in part, on the availability of coverage and adequate

reimbursement from third party payors.

Significant uncertainty exists as to the coverage and reimbursement status of approved biological products.

Governments around the world are exploring cost containment programs, including price controls, reimbursement restrictions, and requirements for biosimilar substitution.

In the United States and markets in other countries, patients rely on third party payors to reimburse healthcare costs.

Third party payors include government authorities, managed care plans, private health insurers and other organizations.

In the United States, the process for determining whether a third party payor will provide coverage and the related coverage criteria for a biological product typically is separate from, but related to, the process for setting the price of such product or for establishing the level of reimbursement that the payor will pay for the product once coverage is approved.

With respect to biologics, third party payors may limit coverage to specific products on an approved list, also known as a formulary, which might not include all of the FDA-approved products for a particular indication, or place products at certain formulary levels that result in lower reimbursement levels, which results in higher cost-sharing financial obligation imposed on patients.

A decision by a third party payor not to cover our product candidates, or to impose coverage criteria the limiting situations in which our product candidates are covered, could reduce physician utilization of a product.

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

Adequate third party reimbursement may not be available to enable a manufacturer to maintain price levels sufficient to realize an appropriate return on its investment in product development.

Third party payors may limit coverage or take other action to control utilization of covered products, including restricting coverage to specific products on an approved list, also known as a formulary, which might not include all of the FDA-approved products for a particular indication, or place products at certain formulary levels that result in lower reimbursement levels, which results in higher cost-sharing financial obligation imposed on patients.

Additionally, coverage, coverage criteria, and reimbursement for products can differ significantly from payor to payor.

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As a result, the coverage determination process usually requires manufacturers to provide scientific, clinical and health economic support for the use of their products to each payor separately, which is a time-consuming process.

As noted above, the marketability of any products for which we receive regulatory approval for commercial sale may suffer if the government and third party payors fail to provide coverage and adequate reimbursement.

The increasing emphasis on cost containment measures in the United States has increased and we expect will continue to increase the pressure on pharmaceutical pricing.

Coverage policies and third party reimbursement rates may change at any time.

Even if favorable coverage and reimbursement are attained for one or more products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

Third party payors are increasingly challenging the prices charged for medical products and services, examining the medical necessity and reviewing the cost-benefit of pharmaceutical products, in addition to questioning safety and efficacy.

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Some jurisdictions operate positive and negative list systems under which products may only be marketed once a reimbursement price has been agreed to by the government.

Member states may approve a specific price or level of reimbursement for the pharmaceutical product, or alternatively adopt a system of direct or indirect controls on the profitability of the company responsible for placing the pharmaceutical product on the market, including volume-based arrangements, caps and reference pricing mechanisms.

Member states may approve a specific price or level of reimbursement for the

pharmaceutical product, or alternatively adopt a system of direct or indirect controls on the profitability of the company responsible for placing the pharmaceutical product on the market, including volume-based arrangements, caps and reference pricing mechanisms.

To obtain reimbursement or pricing approval, some of these countries may require the completion of clinical trials that compare the cost effectiveness of a particular product to currently available therapies.

Other member states allow companies to fix their own prices for medicines but monitor and control company profits.

There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any of our products.

The downward pressure on healthcare costs in general, particularly prescription products, has become very intense.

As a result, increasingly high barriers are being erected to the entry of new products.

In addition, in some countries, cross border imports from low-priced markets exert a commercial pressure on pricing within a country.

Government Programs and Price Reporting

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Healthcare Reform and Potential Changes to Healthcare Laws

The FDA’s and other regulatory authorities’ policies may change, and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.

For example, in December 2016, the 21st Century Cures Act (the “Cures Act”) was signed into law.

The Cures Act, among other things, is intended to modernize the regulation of drugs and devices and to spur innovation, but its ultimate implementation is uncertain.

In addition, in August 2017, the FDA Reauthorization Act was signed into law, which reauthorized the FDAs user fee programs and included additional drug and device provisions that build on the Cures Act.

If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we otherwise may have obtained and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition and results of operations.

Additionally, in the United States, federal and state governments continue to propose and pass legislation designed to reform delivery of, or payment for, health care, which include initiatives to reduce the cost of healthcare generally and drugs specifically.

For example, in March 2010, the U.S.

Congress enacted the ACA, which expanded health care coverage through Medicaid expansion and the implementation of the individual mandate for health insurance coverage and which included changes to the coverage and reimbursement of drug products under government healthcare programs.

Since its enactment, there have been and likely will be judicial, administrative, executive and legislative challenges to certain aspects of the ACA.

Beyond the ACA, there are ongoing and widespread health care reform efforts, a number of which have focused on regulation of prices or payment for drug products.

Drug pricing and payment reform was a focus of the Trump Administration and has been a focus of the Biden Administration.

For example, federal legislation enacted in 2021 eliminates a statutory cap on Medicaid drug rebate program rebates effective January 1, 2024.

Within the United States, federal and state governments have been active in proposing and implementing health care reform.

Drug pricing and payment reform has been an ongoing focus for reform.

Recent examples include federal legislation that eliminated a statutory cap on Medicaid drug rebate program rebates effective January 1, 2024.

As another example, the Inflation Reduction Act (the “IRA”) of 2022 includes a number of changes intended to address rising prescription drug prices in Medicare Parts B and D, with varying implementation dates.

These changes include caps on Medicare Part D out-of-pocket costs, Medicare Part B and Part D drug price inflation rebates, a new Medicare Part D manufacturer discount drug program (replacing the ACA Medicare Part D coverage gap discount program) and a drug price negotiation program for certain high spend Medicare Part B and D drugs (with the first list of drugs announced in 2023).

Subsequent to the enactment of the IRA, in 2022, the Biden administration released an executive order directing the Department of Health and Human Services (“HHS”) to report on how the Center for Medicare and Medicaid Innovation (the “CMMI”) could be leveraged to test new models for lowering drug costs for Medicare and Medicaid beneficiaries.

The report was issued in 2023 and proposed various models that the CMMI is currently developing which seek to lower the cost of drugs, promote accessibility, and improve quality of care, models are currently still in development.

The impact of the IRA on our business and the broader pharmaceutical industry remains uncertain as implementation is ongoing.

These changes or other changes could affect the market conditions for our products.

We expect continued scrutiny on drug pricing and government price reporting from Congress, agencies, and other bodies.

These changes include caps on Medicare Part D out-of-pocket costs, Medicare Part B and Part D drug price inflation rebates, a new Medicare Part D manufacturer discount drug program (replacing the prior Medicare Part D coverage gap discount program) and a drug price negotiation program for certain high spend Medicare Part B and D drugs (with the first list of drugs announced in 2023).

The IRA is anticipated to have a significant impact on the pharmaceutical industry.

As another example, subsequent to the enactment of the IRA, in 2022, the Biden Administration announced its commitment to expanding certain IRA reforms.

There have been significant and wide-ranging reforms to federal policy and the federal government under the new Trump Administration.

Drug pricing and payment reform was a focus of the prior Trump Administration and that focus is likely to continue under the new Trump Administration.

Other potential healthcare reform efforts under the Trump Administration may affect access to healthcare coverage or the funding of health care benefits.

There is significant uncertainty regarding the nature or impact of any such reform as may be implemented by the Trump Administration through executive action or by Congress.

Additionally, there has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices.

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Individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical product pricing, including price constraints, restrictions on copayment assistance by pharmaceutical manufacturers, value-based pricing, marketing cost disclosure and other transparency measures, and, in some cases, measures designed to encourage importation from other countries and bulk purchasing.

Healthcare reform efforts have been and may continue to be subject to scrutiny and legal challenge.

For example, with respect to the ACA, tax reform legislation was enacted that eliminated the tax penalty established for individuals who do not maintain mandated health insurance coverage beginning in 2019 and, in 2021, the U.S.

Court dismissed the latest judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA.

As another example, revisions to regulations under the federal anti-kickback statute would remove protection for traditional Medicare Part D discounts offered by pharmaceutical manufacturers to pharmacy benefit managers and health plans.

Pursuant to court order, the removal was delayed and recent legislation imposed a moratorium on implementation of the rule until January 2032.

As another example, the IRA drug price negotiation program has been challenged in litigation filed by various pharmaceutical manufacturers and industry groups.

Health care reform at the federal or state level could affect demand for, or pricing of, our product candidates if approved for sale.

We cannot, however, predict the ultimate content, timing, or effect of any federal and state reform efforts.

There is no assurance that federal or state health care reform will not adversely affect our future business and financial results.

Healthcare reform efforts have been and may continue to be subject to scrutiny, legal challenge and subsequent amendment, creating further uncertainty.

In addition, other broader legislative changes have been adopted that could have an adverse effect upon, and could prevent, our products’ commercial success.

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Outside the United States, there are also reform efforts.

On December 13, 2021, the EU adopted Regulation No 2021/2282 on Health Technology Assessment (the “HTA”).

While the HTA entered into force in January 2022, it will only begin to apply from January 2025 onwards, with preparatory and implementation-related steps to take place in the interim.

Once the HTA becomes applicable, it will have a phased implementation depending on the concerned products.

In December 2021, the EU adopted Regulation No 2021/2282 on Health Technology Assessment (the “HTA”).

While the HTA entered into force in January 2022, it only became applicable to apply from January 2025 and will have a phased implementation depending on the concerned products.

The HTA intends to boost cooperation among EU member states in assessing health technologies, including new medicinal products, and providing the basis for cooperation at the EU level for joint clinical assessments in these areas.

The HTA will permit EU member states to use common HTA tools, methodologies, and procedures across the EU, working together in four main areas, including joint clinical assessment of the innovative health technologies with the most potential impact for patients, joint scientific consultations whereby developers can seek advice from HTA authorities, identification of emerging health technologies to identify promising technologies early, and continuing voluntary cooperation in other areas.

The HTA permits EU member states to use common HTA tools, methodologies, and procedures across the EU,

working together in four main areas, including joint clinical assessment of the innovative health technologies with the most potential impact for patients, joint scientific consultations whereby developers can seek advice from HTA authorities, identification of emerging health technologies to identify promising technologies early, and continuing voluntary cooperation in other areas.

Individual EU member states will continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technology, and making decisions on pricing and reimbursement.

On April 26, 2023, the Commission published its long-awaited proposals to revise the EU’s pharmaceutical legislation.

In April 2023, the Commission published its long-awaited proposals to revise the EU’s pharmaceutical legislation.

The proposals seek to balance supporting innovation and increasing affordability and availability of medicines.

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and (vi) streamlining regulatory procedures, reducing approval timeline by over 50 days for centrally authorized products.

Timelines for these proposed changes to legislation are currently unknown and may be further complicated by the end of the current Commission’s term of office in October 2024.

Data Privacy and Security Laws

Numerous state, federal and foreign laws, regulations and standards govern the collection, use, access to, confidentiality and security of health-related and other personal information and could apply now or in the future to our operations or the operations of our partners.

In the United States, numerous federal and state laws and regulations, including state comprehensive privacy laws, data breach notification laws, health information privacy and security laws

and consumer protection laws and regulations govern the collection, use, disclosure, and protection of health-related and other personal information.

In addition, certain foreign laws govern the privacy and security of personal data, including health-related data.

Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions on data processing.

In April 2024, the European Parliament adopted its position at first reading of the two EU legislative proposals.

Certain of the legislative changes proposed by the Commission were revised by the European Parliament.

For example, the Parliament wanted to introduce a minimum regulatory data protection period of seven and a half years in addition to two years of market protection.

Companies would be eligible for additional periods of data protection if their product addresses an unmet medical need, if comparative clinical trials are conducted and if a significant share of the research and development takes place in the EU and at least partly in collaboration with EU research entities.

Timelines for these proposed changes to legislation are currently unknown as the legislative proposals must be approved by the European Parliament and the European Council.

It is unlikely that new legislation will be adopted before 2026.

Other Regulations

In additional to the regulations and laws described above, our business is subject to a number of other regulations that apply broadly to companies doing business in the healthcare space, including the following:

● the United States federal Anti-Kickback Statute, which 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, order or recommendation of, any good or service, for which payment may be made under federal and state healthcare programs such as Medicare and Medicaid.

A person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

● the United States federal False Claims Act and civil monetary penalties laws, which, among other things, impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the federal government, claims for payment that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government.

Pharmaceutical manufacturers can be held liable under the False Claims Act even when they do not submit claims directly to government payors if they are deemed to “cause” the submission of false or fraudulent claims.

Moreover, a claim including items and services resulting from a violation of the federal Anti-Kickback Statute is deemed a false or fraudulent claim for purposes of the False Claims Act;

● the United States Foreign Corrupt Practices Act (the “FCPA”), the U.K.

Bribery Act 2010 (the “Bribery Act”) and similar anti-bribery or anti-corruption laws, regulations or rules in other countries in which we operate, which prohibit companies and their representatives from paying, offering to pay, promising to pay

or authorizing the payment of anything of value to any foreign government official, government staff member, political party or political candidate for the purpose of obtaining or retaining business or to otherwise obtain favorable treatment or influence a person working in an official capacity abroad.

The Bribery Act may also create liability where we fail to prevent a person associated with us from committing a bribery offense.

In many countries, the healthcare professionals we interact with may meet the FCPA’s and Bribery Act’s definition of a foreign government official.

The FCPA also requires public companies to make and keep books and records that accurately and fairly reflect their transactions and to devise and maintain an adequate system of internal accounting controls;

● the United States federal Health Insurance Portability and Accountability Act, as amended (“HIPAA”), which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement in connection with the delivery of or payment for healthcare benefits, items or services.

Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

● United States federal civil monetary penalties laws, which impose civil fines for, among other things, the offering or transfer of remuneration to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner, or supplier of services reimbursable by Medicare or a state healthcare program;

● the United States federal physician payment transparency requirements, sometimes referred to as the “Sunshine Act”, which requires manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid or the Children’s Health Insurance Program to report to the Department of Health and Human Services information related to certain financial interactions with physicians (defined to include medical doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician practitioners (including physician assistants and nurse practitioners), and teaching hospitals, as well as the ownership and investment interests of physicians and their immediate family members;

● United States federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers;

● United States federal, state and local laws, and similar foreign laws, regulations and standards governing the collection, use, access to, confidentiality and security of health-related and other personal information;

● analogous United States state laws and regulations, such as state anti-kickback and false claims laws that may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by nongovernmental third party payors, including private insurers;

and state laws that require pharmaceutical companies to adopt certain compliance standards;

restrict interactions with healthcare professionals;

disclose financial interactions with healthcare professionals to the government and public;

report pricing information or marketing expenditures;

or register sales representatives;

● similar healthcare laws and regulations in the EU, United Kingdom and other jurisdictions, including:

Directive 2001/83/EC on the Community code relating to medicinal products for human use and its national implementing legislation;

the UK Human Medicines Regulations 2012;

Directive 2011/83/EU on consumer rights and its national implementing legislation;

and reporting requirements detailing interactions with and payments to healthcare professionals, which may be applicable even if we are not commercializing a product in such jurisdictions.

Human Capital

We aim to cultivate a highly-skilled and passionate team determined to deliver transformative therapies to the patients who need them most.

As of December 31, 2023, we had approximately 297 full-time employees, of which approximately 286 were located within the United States and approximately 11 were located outside of the United States.

As of December 31, 2024, we had 315 full-time employees, of which 301 were located within the United States and 14 were located outside of the United States.

We believe that the success and growth of our business depends in large part on our continued ability to attract, retain and motivate qualified personnel at all levels of our company.

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We believe that our business benefits from the different perspectives that a diverse workforce brings, and we pride ourselves on having an inclusive culture.

Our diversity statement formally expresses our commitment to diversity, equity and inclusion (“DEI”) goals and we maintain a monthly DEI dashboard for our employees.

Our diversity statement formally expresses our commitment to diversity, equity and inclusion (“DEI”) goals.

This initiative is part of our broader effort to establish a systematic approach towards DEI.

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Employees are required to participate in periodic and as-needed trainings in order to refresh their understanding of our policies and provide additional instruction for new issues as and when they arise.

For the clinical and manufacturing activities that we perform and oversee, we adhere to operating within the accepted GCP, cGMP and other similar regulatory guidelines.

For the clinical and manufacturing activities that we perform and oversee, we adhere to operating within the accepted GLP, GCP, cGMP and other similar regulatory guidelines.

Overall, we believe that our commitment to quality and ethics throughout our business makes us a stronger, compliant and competitive organization.

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As part of our employee health and safety program, we have a number of safety policies that employees are required to train on, conduct periodic on-site safety drills at our offices and perform periodic internal and external safety audits.

In addition, we maintain an infectious disease policy to address safety risks arising from COVID-19 and any future pandemic or disease outbreak.

Our Corporate Information

We are an exempted company incorporated under the laws of Bermuda in July 2015.

Our registered office is located in Bermuda at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda.

We were initially incorporated under the laws of Bermuda in July 2015 and, in April 2024, subsequently announced the completion of the change of place of incorporation of our principal holding company from Bermuda to the United Kingdom (the “Redomiciliation”), pursuant to a scheme of arrangement approved by both the Bermuda Supreme Court and our shareholders, which caused the shareholders of our former parent company, Kiniksa Pharmaceuticals, Ltd., to become the shareholders of our current parent company, Kiniksa Pharmaceuticals International, plc.

Our registered office is located at 23 Old Bond Street, London, W1S 4PZ, England, United Kingdom.

The telephone number for our registered office is +1 (781) 431-9100.

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The information contained on our website is not incorporated by reference into this Annual Report, and you should not consider any information contained on, or that can be accessed through, our website as part of this Annual Report.

As used herein, and unless the context otherwise requires, references to “we,” “us,” “our” and similar words or phrases prior to the Redomiciliation shall refer to Kiniksa Pharmaceuticals, Ltd.

and from and after the Redomiciliation, to Kiniksa Pharmaceuticals International, plc.

In addition, references to “ordinary shares” prior to the Redomiciliation are to Kiniksa Pharmaceuticals, Ltd.’s common shares and from and after the Redomiciliation are to Kiniksa Pharmaceuticals International, plc’s ordinary shares.

Where You Can Find More Information

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business