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Item 1. Business

2024-02-28 compared with 2023-03-03 · 418 added, 341 removed, 702 unchanged (52% of the section changed)

We are a clinical-stage biopharmaceutical company focused on the discovery, development and commercialization of novel treatments for patients suffering from hematological, pulmonary and cardiovascular disorders with high unmet medical need.

We are a leader in understanding the role of the transforming growth factor-beta, or TGF-ß, family of proteins, which are master regulators of red blood cell and platelet production as well as of the growth, repair and maintenance of a number of tissues, including blood vessels, skeletal muscle and heart tissue.

We are leveraging this understanding to develop large and small molecules that have the potential to provide meaningful and potentially disease-modifying benefit to patients.

Targeting TGF-ß signaling pathways has been clinically proven to elicit robust changes in blood cells, blood vessels, skeletal muscle and heart tissue, which we believe provides a precedent and strong rationale for our strategy.

Our lead protein therapeutic product candidate, KER-050, is being developed for the treatment of low blood cell counts, or cytopenias, including anemia and thrombocytopenia, in patients with myelodysplastic syndromes, or MDS, and in patients with myelofibrosis.

Our lead small molecule product candidate, KER-047, is being developed for the treatment of functional iron deficiency.

Our third product candidate, KER-012, is being developed for the treatment of pulmonary arterial hypertension, or PAH, and for the treatment of cardiovascular disorders .

We are a clinical-stage biopharmaceutical company focused on developing and commercializing novel therapeutics to treat a wide range of patients with disorders that are linked to dysfunctional signaling of the transforming growth factor-beta, or TGF-ß, family of proteins.

We are a leader in understanding the role of the TGF-ß family of proteins, which are master regulators of the growth, repair and maintenance of a number of tissues, including blood, bone, skeletal muscle, adipose and heart tissue.

By leveraging this understanding, we have discovered and are developing protein therapeutics that have the potential to provide meaningful and potentially disease-modifying benefit to patients.

Our lead product candidate, KER-050 (elritercept), is being developed for the treatment of low blood cell counts, or cytopenias, including anemia and thrombocytopenia, in patients with myelodysplastic syndromes, or MDS, and in patients with myelofibrosis.

Our second product candidate, KER-012, is being developed for the treatment of pulmonary arterial hypertension, or PAH, and for the treatment of cardiovascular disorders .

Our third product candidate, KER-065, is being developed for the treatment of obesity and for the treatment of neuromuscular diseases.

KER-050 is an engineered ligand trap comprised of a modified ligand-binding domain of the TGF-ß receptor known as activin receptor type IIA, or ActRIIA, that is fused to the portion of the human antibody known as the Fc domain.

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We believe KER-050 has the potential to provide benefit to patients suffering from red blood cell and platelet differentiation and maturation defects occurring across the spectrum from early through terminal stages of hematopoiesis, and consequently may be effective for many patients that have limited treatment options or are refractory to available therapies.

Based on data from our completed Phase 1 clinical trial of KER-050 in healthy volunteers and from multiple preclinical studies, we believe KER-050 has a differentiated pharmacologic effect on red blood cells and platelets and has the potential to treat multiple cytopenias in diseases of ineffective hematopoiesis while also improving bone health and altering the bone marrow microenvironment to slow down disease progression.

In December 2022, we announced additional data from Part 2 of our ongoing Phase 2 clinical trial evaluating KER-050 for the treatment of anemia and thrombocytopenia in patients with very low-, low-, or intermediate-risk MDS.

We expect to report additional data from Part 2 of this trial in each of the first and second half of 2023.

Additionally, in December 2022, we announced initial data from our ongoing Phase 2 clinical trial evaluating KER-050 for the treatment of patients with myelofibrosis-associated cytopenias.

We expect to report additional dose escalation data from this trial in the second half of 2023.

KER-047 is designed to selectively and potently inhibit activin receptor-like kinase-2, or ALK2, a TGF-ß receptor.

Excessive ALK2 signaling causes elevated levels of hepcidin, a key regulator of iron absorption and recycling.

We believe that KER-047 has the potential to ameliorate excessive ALK2 signaling, which would normalize hepcidin expression and mobilize iron out of tissues.

We believe this effect will result in increased iron bioavailability, potentially leading to a restoration of erythropoiesis and reduction in iron overload in patients with functional iron deficiency.

We are developing KER-047 for the treatment of functional iron deficiency which is a consequence of elevated ALK2 signaling, including our initial target, iron-refractory iron deficiency anemia, or IRIDA.

In December 2022, we announced initial data from one patient enrolled in our ongoing Phase 2 clinical trial in patients with IRIDA, and expect to report additional data from this trial in the second half of 2023.

We also expect to commence an open-label Phase 2 clinical trial in MDS and myelofibrosis patients with functional iron deficiency in the first half of 2023, and expect to report initial data from this trial in the second half of 2023.

KER-012 is designed to bind to and inhibit the signaling of TGF-ß ligands that stimulate smooth muscle hypertrophy and fibrosis, including activin A, activin B and myostatin (GDF8).

Based on data from our ongoing Phase 2 clinical trial evaluating KER-050 for the treatment of anemia and thrombocytopenia in patients with very low-, low-, or intermediate-risk MDS and from multiple preclinical studies, we believe KER-050 has a differentiated pharmacologic effect on red blood cells and platelets and has the potential to treat multiple cytopenias in diseases of ineffective hematopoiesis while also improving bone health and altering the bone marrow microenvironment to slow down disease progression.

We expect to report additional data from Part 2 of our ongoing Phase 2 clinical trial of KER-050 in the second and fourth quarters of 2024, and plan to engage with regulators on the design of the planned Phase 3 clinical trial of KER-050 in patients with MDS in the first half of 2024.

Additionally, in December 2023, we announced additional data from our ongoing Phase 2 clinical trial evaluating KER-050 for the treatment of patients with myelofibrosis-associated cytopenias, which we refer to as the RESTORE trial.

We expect to announce additional data from this trial in the second and fourth quarters of 2024.

Our second product candidate, KER-012, is designed to bind to and inhibit the signaling of TGF-ß ligands that stimulate the proliferation of vascular endothelial and smooth muscle cells and fibroblasts, including activin A, activin B and myostatin (GDF8).

We believe that KER-012 has the potential to increase the signaling of bone morphogenic protein, or BMP, pathways through this inhibition of activin A and activin B signaling, and consequently treat diseases such as PAH that are associated with reduced BMP signaling, including inactivating mutations in the BMP receptors.

We are developing KER-012 for the treatment of PAH and for the treatment of cardiovascular disorders.

We have completed a Phase 1 clinical trial of KER-012 in healthy volunteers, and expect to commence a Phase 2 clinical trial evaluating KER-012 in patients with PAH in the first half of 2023.

We also expect to commence an open-label Phase 2 biomarker clinical trial of KER-012 in the second half of 2023.

Our strategy focuses on the role of members of the TGF-ß family of proteins in the development of a number of tissues, including blood vessels , skeletal muscle and heart tissue.

We expect to provide an update on enrollment for our ongoing Phase 2 clinical trial evaluating KER-012 in patients with PAH, which we refer to as the TROPOS trial, in the first half of 2024.

We also expect to announce initial data from our ongoing open-label Phase 2 biomarker clinical trial of KER-012 in patients with chronic heart failure with preserved ejection fraction and in such patients with reduced ejection fraction in the second half of 2024.

Our third product candidate, KER-065, is designed to bind to and inhibit TGF-ß ligands, including myostatin (GDF8) and activin A, which are negative regulators of muscle and bone mass and strength.

Through inhibition of these TGF-ß ligands, we believe that KER-065 has the potential to increase skeletal muscle, increase energy expenditure, reduce body fat, improve insulin resistance and improve cardiac function.

We are developing KER-065 for the treatment of obesity and for the treatment of neuromuscular disorders.

Increased body adiposity, loss of skeletal muscle and bone loss are consequences of obesity.

Significant loss of lean muscle mass has been associated with weight loss mediated by the class of glucagon-like pepetide-1, or GLP-1, receptor agonists.

We have commenced a Phase 1 clinical trial of KER-065 in a healthy volunteer adult population, and expect to announce initial data from this trial in the first quarter of 2025.

Following the completion of this trial, we plan to initiate a proof-of-concept trial of KER-065 in obese patients.

Our strategy focuses on the role of members of the TGF-ß family of proteins in the development of a number of tissues, including blood , bone, skeletal muscle, adipose and heart tissue.

Aged and damaged cells are routinely replaced by new cells in normally functioning organs.

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We seek to address the limitations of current therapeutic approaches to treating diseases whose manifestations are linked to dysfunction of TGF-ß signaling pathways by:

▪ Leveraging our comprehensive insights into the TGF-ß signaling pathways to discover therapeutics to treat hematological, pulmonary and cardiovascular disorders.

▪ Expanding our library of proprietary molecules that are engineered to induce desired biological effects, such as increased blood cell production and increased muscle mass and strength.

▪ leveraging our comprehensive insights into the TGF-ß signaling pathways to discover therapeutics to treat disorders that are linked to dysfunctional TGF-ß signaling;

▪ expanding our library of proprietary molecules that are engineered to induce desired biological effects, such as increased blood cell production, reduced body fat and increased muscle mass and strength;

▪ engineering proprietary molecules to selectively target specific proteins in the TGF-ß signaling pathways to provide therapeutic benefit while potentially minimizing safety risks;

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in November 2021), Wyeth Pharmaceuticals Inc., F.

Hoffman-La Roche Ltd (Roche), Novartis International AG, AbbVie Inc., Human Genome Sciences (with was acquired by GlaxoSmithKline plc in July 2012), Seres Therapeutics, Inc., Kadmon Holdings, Inc., Anokion SA and Sanofi S.A.

Hoffman-La Roche Ltd (Roche), Novartis International AG, AbbVie Inc., Human Genome Sciences (with was acquired by GlaxoSmithKline plc in July 2012), Kadmon Holdings, Inc., Anokion SA and Sanofi S.A.

The following table sets forth our product candidates and their current development stages.

Our mission is to deliver significant clinical benefit to patients suffering from hematological, pulmonary and cardiovascular disorders.

Our mission is to deliver significant clinical benefit to patients suffering from hematological, pulmonary, cardiovascular, obesity and neuromuscular disorders.

With a focus on developing differentiated product candidates that are designed to alter TGF-β signaling, we aim to target the pathways critical for the growth, repair and maintenance of a number of tissue and organ systems.

The key elements of our strategy include:

▪ Rapidly advance the clinical development of KER-050 for the treatment of patients with MDS- and myelofibrosis-associated cytopenias.

▪ Rapidly advance the clinical development of KER-050, KER-012 and KER-065.

We are continuing to progress our ongoing Phase 2 clinical trial evaluating KER-050 for the treatment of anemia and thrombocytopenia in patients with very low-, low-, or intermediate-risk MDS who either have or have not previously received treatment with an erythropoiesis-stimulating agent.

We expect to report additional data from Part 2 of this trial in each of the first and second half of 2023.

We also expect to announce additional data from our ongoing open-label Phase 2 clinical trial evaluating the treatment of patients with myelofibrosis-associated cytopenias in the second half of 2023.

▪ Advance the clinical development of KER-047 for the treatment of functional iron deficiency.

We are continuing to progress our open-label Phase 2 clinical trial in patients with IRIDA and expect to report additional data from this trial in the second half of 2023.

▪ Rapidly advance the clinical development of KER-012 for the treatment of PAH and for the treatment of cardiovascular disorders.

We expect to commence a Phase 2 clinical trial evaluating KER-012 in patients with PAH in the first half of 2023.

We also expect to commence an open-label Phase 2 biomarker clinical trial of KER-012 in the second half of 2023.

We expect to report additional data from Part 2 of this trial in the second and fourth quarters of 2024, and plan to engage with regulators on the design of the planned Phase 3 clinical trial of KER-050 in patients with MDS in the first half of 2024.

We also expect to announce additional data from our ongoing open-label Phase 2 clinical trial evaluating KER-050 for the treatment of patients with myelofibrosis-associated cytopenias in the second and fourth quarters of 2024.

We expect to provide an update on enrollment for our ongoing Phase 2 clinical trial evaluating KER-012 in patients with PAH in the first half of 2024, and to announce initial data from ongoing open-label Phase 2 biomarker clinical trial of KER-012 in patients with chronic heart failure with preserved ejection fraction and in such patients with reduced ejection fraction in the second half of 2024.

We have also commenced a Phase 1 clinical trial of KER-065 in a healthy volunteer adult population, and expect to announce initial data from this trial in the first quarter of 2025.

▪ Pursue development and, if approved, commercialization of our product candidates in indications and regions where we believe we can maximize their value independently or through strategic collaborations.

We plan to independently advance our product candidates in indications and regions that we believe have clearly defined regulatory paths and commercialization strategies.

We plan to independently advance our product candidates in indications and regions that we believe have clearly defined regulatory paths and

commercialization strategies.

We intend to opportunistically evaluate strategic collaborations to maximize the potential commercial value of our product candidates and discovery programs.

▪ Leverage our proprietary discovery approach and knowledge base to develop new therapeutics.

Our discovery efforts are focused on expanding our pipeline of wholly-owned assets for the treatment of hematological, pulmonary and cardiovascular disorders.

Our discovery efforts are focused on expanding our pipeline of wholly-owned assets for the treatment of disorders that are linked to dysfunctional TGF-ß signaling .

Accordingly, we intend to identify and develop product candidates to treat diseases where targeting the TGF-ß signaling pathways has clinical validation or biological rationale.

▪ Maintain a dynamic, data-driven operating model .

We manage our clinical programs dynamically, utilizing a data-driven approach to determine which product candidates and discovery-stage assets to develop, which includes considering the potential product profile and the most recent data.

Our extensive knowledge of our assets and the process of drug development informs our decision-making process regarding when to advance the science and clinical path to pursue demonstrating proof-of-concept, balanced with the imperative of maintaining an efficient timeframe and cost-effective budget.

Our Hematology Franchise

KER-050 and KER-047, which form the backbone of our hematology franchise, are designed to target TGF-ß signaling pathways to address diseases that arise from ineffective hematopoiesis and functional iron deficiency, respectively.

KER-050 is designed to target TGF-ß signaling pathways to address diseases that arise from ineffective hematopoiesis.

Hematopoiesis

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a lack of red blood cells leads to anemia, a lack of platelets hampers clotting, resulting in increased incidence of bleeding events, and a lack of neutrophils increases susceptibility to infection.

The failure of progenitor cells to differentiate can also lead to a build-up of these cells, resulting in bone marrow failure and fibrotic disease.

of progenitor cells to differentiate can also lead to a build-up of these cells, resulting in bone marrow failure and fibrotic disease.

The graphic below provides an illustration of the difference in the number of progenitor cells and mature bloods cells that are produced in normal hematopoiesis and in ineffective hematopoiesis.

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For the Treatment of Ineffective Hematopoiesis to Address Cytopenias

We are developing KER-050, our lead protein therapeutic product candidate, for the treatment of cytopenias that occur due to ineffective hematopoiesis, including anemia and thrombocytopenia, in patients with MDS and in patients with myelofibrosis.

We are developing KER-050, our lead product candidate, for the treatment of cytopenias that occur due to ineffective hematopoiesis, including anemia and thrombocytopenia, in patients with MDS and in patients with myelofibrosis.

KER-050 is designed to benefit patients suffering from defects in red blood cell and platelet differentiation and maturation across the spectrum from early through terminal stages of hematopoiesis.

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Limitations of Current Treatment Options for Cytopenias in Patients with MDS

Patients with MDS-associated anemia are generally treated with red blood cell transfusions and erythropoises-stimulating agents, or ESAs, which are not approved for such treatment.

Patients with MDS-associated anemia are generally treated with red blood cell transfusions and erythropoiesis-stimulating agents, or ESAs, which are not approved for such treatment.

The current treatment of MDS-associated thrombocytopenia is platelet transfusions and platelet-stimulating agents.

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The highest proportion of responders to Reblozyl were those with low transfusion dependence, while only a few high transfusion burden patients achieved transfusion independence despite being RS positive patients.

Accordingly, we believe that additional treatment options will be needed to address anemia in the heterogeneous non-ring sideroblast MDS population, to provide clinical benefit to the RS positive population regardless of transfusion burden and to address other cytopenias, such as thrombocytopenia.

The FDA also approved Reblozyl in August 2023 for the treatment of anemia without previous erythropoiesis stimulating agent use (ESA-naïve) in adult patients with very low- to intermediate-risk MDS who may require regular red blood cell transfusions.

We believe that additional treatment options will be needed to address anemia in the heterogeneous non-ring sideroblast MDS population, to provide clinical benefit to the RS positive population regardless of transfusion burden and to address other cytopenias, such as thrombocytopenia.

KER-050 is designed to alter TGF-ß signaling pathways at multiple stages of hematopoietic differentiation in both red blood cells and platelets.

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Limitations of Current Treatment Options for Cytopenias in Patients with Myelofibrosis

There are no approved pharmacological treatments for myelofibrosis-associated cytopenias.

The National Comprehensive Cancer Network describes all therapeutic options to address myelofibrosis-associated cytopenias, including transfusions, as only minimally effective.

Currently approved products for the treatment of myelofibrosis, including JAK inhibitors ruxolitinib (Jakafi), fedratinib (Inrebic) and pacritinib (Vonjo), have been observed to exacerbate myelofibrosis-associated cytopenias.

In a third-party Phase 3 clinical trial of Jakafi and a third-party Phase 3 clinical trial of Inrebic, treatment led to significant reductions in spleen volume and improvement in total symptom scores.

In a third-party Phase 3 clinical trial of Jakafi and a third-party Phase 3 clinical trial of Inrebic, treatment led to significant reductions in spleen volume

and improvement in total symptom scores.

However, JAK inhibitors interfere with normal hematopoiesis and treatment with Jakafi and Inrebic also resulted in clinically significant anemia and thrombocytopenia in these Phase 3 trials.

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The treatment-related cytopenias led to severe complications, dose reductions and reduced compliance.

We believe KER-050 has the potential to ameliorate myelofibrosis-associated cytopenias.

In September 2023, momelotinib (Ojjaara) received approval from the FDA for the treatment of intermediate or high-risk myelofibrosis in adults with anemia.

In a third-party Phase 3 clinical trial of Ojjaara versus danazol in patients with myelofibrosis who were symptomatic and anemic and had been previously treated with an approved JAK inhibitor, 25% in the Ojjaara arm achieved the primary endpoint of total symptom score reduction of at least 50%, compared to 9% in the danazol arm.

Additionally, 31% in the Ojjaara arm achieved the secondary endpoint of transfusion independence, compared to 20% in the danazol arm.

In a separate third-party Phase 3 clinical trial of Ojjaara versus ruxolitinib in JAK-naïve patients, in the subset of patients with anemia, a numerically lower percent of patients treated with Ojjaara (25%) achieved a total symptom score reduction of 50% or more at Week 24 compared with ruxolitinib (36%).

In this trial, similar reductions in spleen volume reduction were observed with both Ojjaara (31%) and ruxolitinib (33%).

We believe KER-050 has the potential to not only ameliorate myelofibrosis-associated cytopenias, but also improve spleen volume and patient-reported outcomes, alone or in combination with approved products regardless of the underlying mechanism of action of such products, including JAK inhibitors and Ojjaara.

Our Solution:

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The KER-050-mediated inhibition of these regulators has been shown in preclinical studies to stimulate the progenitors to progress to maturation and, consequently, increase the number of mature cells in the blood.

Specifically related to red blood cells, we have demonstrated in multiple preclinical studies that administration of a mouse version of KER-050, or RKER-050, elicited increases in red blood cell production in healthy mice by stimulating multiple stages in the maturation of erythroid precursors.

The rapid and sustained increase in red blood cells observed in these preclinical studies suggests that RKER-050 potentially stimulated both terminal maturation of late-stage erythroid precursors to rapidly increase red blood cells and maturation of early-stage precursor populations to increase the pool of progenitors that can be mobilized for a sustained upregulation of erythropoiesis.

Additionally, by increasing the pool of early erythroid precursor cells and serum erythropoietin, we believe KER-050 can potentially treat patients with MDS that have hypocellular bone marrow.

We have also observed an increase in erythropoietin in healthy mice in preclinical studies of RKER-050, which we believe could contribute to the durability in red blood cell production and is supportive of the durability of the red blood cell increase we observed in our Phase 1 clinical trial of KER-050 in healthy post-menopausal women.

We have also demonstrated in preclinical studies that treatment with a single dose of RKER-050 resulted in rapid and sustained increases in platelets in healthy mice.

We observed an increase in platelets 12 hours after administration of RKER-050, which we believe supports that KER-050 can potentially promote production of platelets by blocking inhibitory TGF-ß ligands so that megakaryocytes can fully differentiate.

Additionally, bone marrow analysis performed 24 hours post-dose demonstrated that administration of RKER-050 increased the megakaryocyte precursor population, and that these cells had increased ploidy compared to vehicle-treated mice.

These data suggest that RKER-050 promoted the maturation of early megakaryocyte populations and primed megakaryocytes for proplatelet production.

Separately, in a preclinical study in wild type mice, treatment with ruxolitinib resulted in reductions in red blood cells, hemoglobin and hematocrit, recapitulating the anemia observed in myelofibrosis patients.

Administration of RKER-050 reversed the observed ruxolitinib-associated reductions in the red blood cell parameters, which we believe supports the potential of KER-050 to mitigate the dose-limiting effects of ruxolitinib and enhance the duration of therapy in myelofibrosis patients.

Data from our Phase 1 clinical trial in healthy volunteers and our two ongoing Phase 2 clinical trials, one in patients with MDS and one in patients with myelofibrosis, also demonstrate that treatment with KER-050 increased red blood cell and platelet production.

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Mechanism of Action of KER-050

Consistent with our preclinical studies, which showed improvement in bone health, we observed an increase in b one-specific alkaline phosphatase, a biomarker of bone remodeling , in our Phase 1 clinical trial in healthy volunteers following administration of KER-050.

Phase 2 clinical trial in patients with MDS, following administration of KER-050.

Based on these data, we believe KER-050 also has the potential to regenerate a healthy bone marrow and slow disease progression.

Administration of RKER-050, a mouse version of KER-050, reversed the observed ruxolitinib-associated reductions in the red blood cell parameters, which we believe supports the potential of KER-050 to mitigate the dose-limiting effects of ruxolitinib and enhance the duration of therapy in myelofibrosis patients.

We intend to develop KER-050 for the treatment of both MDS- and myelofibrosis-associated cytopenias.

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By acting on cell types throughout the erythropoiesis pathway, KER-050 may lead to robust responses in RS positive patients who have a characteristic defect in terminal maturation, and may also address anemia in the broader MDS population, including non-RS patients, that has defects in earlier-stage erythroid cell development.

Specifically related to red blood cells, we have demonstrated in multiple preclinical studies that administration of RKER-050 elicited increases in red blood cell production in healthy mice by stimulating multiple stages in the maturation of erythroid precursors.

Additionally, by increasing the pool of early erythroid precursor cells and serum erythropoietin, we believe KER-050 can potentially treat patients with MDS that have hypocellular bone marrow.

• Increased platelet counts in blood.

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Additionally, by promoting thrombopoiesis, we believe KER-050 has the potential to aid the differentiation of megakaryocytes to platelets in myelofibrosis patients and reactivate hematopoiesis in the bone marrow.

We have demonstrated in preclinical studies that treatment with a single dose of RKER-050 resulted in rapid and sustained increases in platelets in healthy mice.

These data suggest that RKER-050 promoted the maturation of early megakaryocyte populations and primed megakaryocytes for proplatelet production.

• Reduced accumulation of progenitor cells.

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We are conducting an open label, two-part, multiple ascending dose Phase 2 clinical trial to evaluate KER-050 in patients with very low-, low-, or intermediate-risk MDS who either have or have not previously received treatment with an ESA.

primary objective of this trial is to assess the safety and tolerability of KER-050 in patients with MDS that either have ring sideroblasts, or RS positive, or do not have ring sideroblasts, or non-RS.

The primary objective of Part 2 of this trial is confirmation of the safety and tolerability of the selected dose levels.

The primary objective of this trial is to assess the safety and tolerability of KER-050 in patients with MDS that either have ring sideroblasts, or RS positive, or do not have ring sideroblasts, or non-RS.

The primary objective of Part 2 of this trial is

confirmation of the safety and tolerability of the selected dose levels.

The secondary objectives of this trial are to evaluate the pharmacokinetics, pharmacodynamics and efficacy of KER-050.

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Phase 2 Clinical Trial Design

chronic myelomonocytic leukemia

KER-050 is being administered to patients subcutaneously once every four weeks.

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In December 2023, we presented additional data from this ongoing trial at the 65th American Society of Hematology, or ASH, Annual Meeting and Exposition.

As of October 1, 2022, which was the data cut-off date, 25 patients from Part 1, including the Part 1 Extension, and 11 patients from Part 2 had received at least one dose of KER-050 at RP2D, which we refer to as the safety population.

29 of these patients had completed eight weeks of treatment and the applicable assessments as of the data cut-off date, which we refer to as the evaluable RP2D patients.

Of the 36 patients in the safety population, 63.9% (n=23/36) were RS positive while 36.1% (n=13/36) were non-RS.

The safety population was comprised of ten non-transfused, or NT, six low transfusion burden, or LTB, and 20 high transfusion burden, or HTB, patients.

As of the data cut-off date, 51.7% (n=15/29) of the evaluable RP2D patients achieved an overall erythroid response, which is defined as meeting one of the following two endpoints:

• IWG 2006 Hematological improvement-erythroid, or HI-E, which is defined as either:

◦ a ≥ 1.5 g/dL increase in hemoglobin for eight weeks in LTB and NT patients;

As of September 1, 2023, which was the data cut-off date, 79 patients had received at least one dose of KER-050 at RP2D, which we refer to as the safety population.

60 of these patients had completed at least 24 weeks of treatment or discontinued as of the data cut-off date, which we refer to as the mITT 24 patients.

Data for hematological response and markers of hematopoiesis were presented from exploratory analyses of these mITT 24 patients.

Of the 79 patients in the safety population, 55.7% (n=44/79) had high transfusion burden, or HTB, while 25.3% (n=20/79) had low transfusion burden, or LTB, and 19.0% (n=15/79) were non-transfused, or NT.

KER-050 was generally well tolerated as of the data cut-off date.

No patients had progressed to acute myeloid leukemia.

There were two cases of a fatal treatment-emergent adverse event, or TEAE, in the trial that were each determined to be unrelated to treatment.

There were three treatment-related TEAEs that led to discontinuation of treatment, including injection site reaction, platelet count increase and dyspnea.

The most commonly reported TEAEs (in ≥15% of patients) were diarrhea, dyspnea, fatigue, nausea and headache.

As of the data cut-off date, 50% (n=30/60) of the mITT 24 patients achieved an overall erythroid response over the first 24 weeks of treatment, which is defined as meeting at least one of the following two endpoints:

• Modified IWG 2006 Hematological improvement-erythroid, or HI-E, which is defined as either:

◦ a ≥ 1.5 g/dL increase in hemoglobin for at least eight weeks in LTB and NT patients;

◦ a reduction by ≥ 4 red blood cell units transfused during any eight-week period during the trial, compared with the eight-week period prior to cycle 1, Day 1 in HTB patients.

• Transfusion independence, or TI, for at least eight weeks in transfusion-dependent patients who required ≥ 2 red blood cell units transfused at baseline.

Additional data from the evaluable RP2D patients, as of the data cut-off date, include:

• 51.7% (n=15/29) of the evaluable RP2D population achieved HI-E over an eight-week period.

• 50.0% (n=9/18) of the transfused RP2D patients receiving ≥ two red blood cell units at baseline achieved TI for at least eight weeks.

Of these 18 patients, 12 were RS positive and six were non-RS.

◦ 50.0% (n=6/12) of these RS positive patients achieved TI for at least eight weeks.

◦ 50.0% (n=3/6) of these non-RS patients achieved TI for at least eight weeks.

• Of the transfused RP2D patients, 50.0% (n=8/16) of those who are HTB achieved TI for at least eight weeks.

Of these 16 patients, 11 were RS positive and five were non-RS.

◦ 45.5% (n=5/11) of these RS positive HTB patients achieved TI for at least eight weeks.

◦ 60.0% (n=3/5) of these non-RS HTB patients achieved TI for at least eight weeks.

• 53.3% (n=8/15) of the transfused RP2D patients receiving ≥ two red blood cell units at baseline, with the opportunity to extend treatment beyond four cycles, achieved TI for at least 12 weeks, demonstrating a sustained TI benefit with continued treatment.

◦ Of these transfused RP2D patients, 50.0% (n=7/14) of those who are HTB achieved TI for at least 12 weeks.

As of the data cut-off date, sustained increases in platelet counts were observed for patients achieving HI-E or TI over a 24-week treatment period, supporting a potentially differentiated mechanism of KER-050 to promote hematopoiesis across multiple cell lineages.

As of the data cut-off date, KER-050 was generally well tolerated by the 36 patients in the safety population.

No dose-limiting toxicities were reported, and no patients progressed to acute myeloid leukemia.

There was one case of a fatal treatment-emergent adverse event, or TEAE, in the trial that was determined to be unrelated to treatment.

There were three additional TEAEs that led to discontinuation of treatment, one of which was deemed treatment related (injection site reaction) and two of which were determined to be unrelated to treatment (dyspnea and chronic obstructive pulmonary disease).

The most commonly reported TEAEs were diarrhea, fatigue, dyspnea and nausea.

The following data from one patient enrolled in this trial was also presented:

• A 72-year-old non-RS, HTB male patient with MDS with multi-lineage dysplasia and concomitant iron chelation therapy achieved an initial HI-E response, but not TI, when treated with four 1.5 mg/kg doses of KER-050 in Part 1 of the trial.

The patient was re-screened and initiated Part 1 Extension following a 112-day gap between the last dose he received in Part 1 of the trial and the first dose he received in the Part 1 Extension.

The patient achieved TI upon recommencement of treatment at a 2.5 mg/kg dose of KER-050 every four weeks.

After 24 weeks, the patient dose escalated to 3.75 mg/kg every four weeks per the trial protocol, and remained TI for at least 44 weeks as of the data cut-off date.

• As of January 9, 2023, this patient had remained TI for 60 weeks.

We also presented an exploratory analysis of biomarkers of iron overload, or IO, with data from the 31 patients who received up to four cycles of treatment in the completed Part 1.

58.1% (n=18/31) of these patients were classified as HTB.

At baseline, transfusion-dependent patients exhibited biomarkers suggestive of a greater degree of ineffective hematopoiesis than NT patients, including lower levels of hemoglobin, reticulocytes and soluble transferrin receptor.

In addition, lower levels of transferrin and elevated levels of serum ferritin at baseline, especially among HTB patients, suggest more severe IO in transfusion-dependent patients as compared to NT patients.

Key observations from this analysis, as of the data cut-off date, are as follows:

• Soluble transferrin receptor levels generally increased with KER-050 treatment, particularly in HTB patients, while ferritin levels decreased.

• On an individual level, most patients who achieved HI-E or TI also showed decreases in serum ferritin.

Such decreases were generally greater in patients with baseline ferritin of >500 ng/mL, suggesting potential for KER-050 to reduce IO in the most impacted patients.

• Reductions in transfusion burden, based on transfused red blood cells over eight weeks, were generally associated with reductions in serum ferritin, especially for patients who achieved TI.

Taken together, the results from the trial and the exploratory analysis as of the data cut-off date suggest that KER-050 has the potential to improve hematopoiesis, reduce transfusion burden and reduce IO, particularly in patients receiving frequent red blood cell transfusions.

Additional data from the mITT 24 patients, as of the data cut-off date, include:

• 39.1% (n=18/46) of the TI-evaluable patients achieved TI for at least eight weeks over the first 24 weeks of treatment.

13 of those 18 patients (72.2%) achieved TI for at least 24 weeks over the first 48 weeks of treatment.

• Of the patients with HTB, 33.3% (n=11/33) achieved TI for at least eight weeks during the first 24 weeks of treatment.

7 of those 11 patients (63.6%) achieved TI for at least 24 weeks over the first 48 weeks of treatment.

Studies in mainly lower-risk-MDS patients suggest that the majority (~90%) of patients have serum erythropoietin levels less than 500 U/L.

Additionally, erythropoietin levels of ≥ 500 U/L are associated with lower erythroid response rates across multiple treatments.

Accordingly, we evaluated a subset of transfusion-dependent mITT 24 patients with a baseline erythropoietin level less than 500 U/L (n=38), and observed the following, as of the data cut-off date:

• 44.7% (n=17/38) achieved TI for at least eight weeks over the first 24 weeks of treatment.

• Of the mITT 24 patients with baseline erythropoietin level less than 500 U/L and HTB, 38.5% (n=10/26) achieved TI for at least eight weeks over the first 24 weeks of treatment.

The FACIT-Fatigue scale, a measure of self-reported fatigue and its impact upon daily activities and function, was utilized to assess health-related quality of life in 45 of the mITT 24 patients who were TI-evaluable and had baseline FACIT-Fatigue assessment.

A difference of three in the FACIT-Fatigue scale is considered a minimally clinically important difference.

In this group, patients who achieved TI had durable and clinically meaningful improvements in self-reported fatigue.

At Week 24, patients achieving TI of eight weeks or longer within first 24 weeks had a mean change from baseline in FACIT-Fatigue score of 5.8 (n=10) versus patients who did not achieve TI who reported a mean change from baseline in FACIT-Fatigue score of -3.2 (n=11), for a mean difference in change from baseline of 9.0 between TI responders and non-responders.

At Week 24, patients achieving TI of 24 weeks or longer within the first 48 weeks had a mean change from baseline in FACIT-Fatigue score of 7.8 (n=9) versus patients who did not achieve TI who reported a mean change from baseline in FACIT-Fatigue score of -3.9 (n=12), for a mean difference in change from baseline of 11.7 between TI responders and non-responders.

The majority of patients enrolled in this ongoing trial had HTB or multi-lineage dysplasia, indicating a difficult-to-treat trial population.

Durable TI responses were observed in a broad range of patients with lower-risk MDS, including in those with HTB, which support the potential for KER-050 to ameliorate ineffective hematopoiesis across multiple lineages in patients with MDS.

Patients who achieved TI showed clinically meaningful improvements in FACIT-Fatigue scores, indicating that KER-050 may improve quality of life in patients with lower-risk MDS.

We also presented an exploratory analysis of biomarkers that may indicate MDS disease modification.

Observations from these biomarkers, as of the data cut-off date, included improvements in:

• Iron metabolism:

48.3% (n=14/29) of patients with baseline ferritin ≥ 1,000 ng/ml had a decreased ferritin to < 1000 ng/ml and 69.0% (n=20/29) of patients decreased ferritin by ≥20%.

Two patients, including one who was NT, discontinued iron chelator therapy due to observed decreases in ferritin.

These data support potential of KER-050 to ameliorate iron overload.

• Hematopoiesis:

Sustained increases in hemoglobin for 24 weeks coincided with observed increases in soluble transferrin receptor and concomitant decreases in serum ferritin, suggesting KER-050 resulted in durable restoration of erythropoiesis and improved iron metabolism.

• Bone turnover:

Increases in bone-specific alkaline phosphatase, a marker of osteoblast activity, were observed with KER-050 treatment regardless of hematological response, baseline transfusion burden or RS status, suggesting KER-050 can potentially restore a bone marrow microenvironment conducive to functional hematopoiesis.

• Cardiac stress:

Levels of N-terminal prohormone of brain natriuretic protein, a biomarker of myocardial stress, decreased in both HI-E and/or TI responders and non-responders, suggesting that KER-050 may ameliorate cardiac strain directly via inhibition of activin A and indirectly by improving anemia and reducing transfusion burden.

Collectively, these exploratory data suggest that KER-050 has the potential to provide benefit to patients with MDS beyond treatment of anemia, such as reestablishing hematopoiesis across multiple cell lineages, restoring homeostasis within the osteohematopoietic niche and ameliorating myocardial strain.

We expect to report additional data from this trial in the second and fourth quarters of 2024, and plan to engage with regulators on the design of the planned Phase 3 clinical trial of KER-050 in patients with MDS in the first half of 2024.

Ongoing Phase 2 Clinical Trial in Patients with Myelofibrosis-Associated Cytopenias

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Phase 2 Clinical Trial Design

In December 2022, we presented initial data from this ongoing trial at the 64th ASH Annual Meeting and Exposition.

As of October 1, 2022, which was the data cut-off date, 12 patients were enrolled in Part 1, with six patients in each arm receiving 0.75 mg/kg dose of KER-050.

For the patients in the combination therapy arm, the median ruxolitinib dose was 12.5 mg twice daily at baseline.

As of the data cut-off date, in each of the arms, at least half of the enrolled patients had received three or more doses of KER-050.

At baseline, 41.7% (n=5/12) were transfusion-dependent, with an average transfusion burden of 9.8 red blood cell units in the 12 weeks preceding cycle 1, Day 1.

As of the data cut-off date, KER-050 was generally well tolerated, with no drug-related serious adverse events or dose-limiting toxicities reported.

No patients had a treatment-related dose reduction of KER-050 or ruxolitinib as of the data cut-off date.

The most commonly reported TEAEs were diarrhea, COVID-19, dyspnea and fatigue.

One patient withdrew from the trial due to an unrelated adverse event.

Although variability was observed, as of the data cut-off date, treatment with KER-050 at the lowest dose in the trial (0.75 mg/kg) resulted in increased reticulocytes and platelets on aggregate across cycles 1 and 2.

These increases were observed in both monotherapy and combination arms, as well as in both non-transfusion-dependent and transfusion-dependent patients.

These data support the potential of KER-050 to potentially promote differentiation of erythroid and megakaryocytic precursors and treat anemia and thrombocytopenia in patients with myelofibrosis.

The following data from two patients enrolled in this trial were also presented:

• In a 60 year-old, non-transfusion-dependent female patient with primary myelofibrosis in the monotherapy arm, an increase in reticulocytes was observed after a single 0.75 mg/kg dose of KER-050, which was followed by a sustained increase in hemoglobin of >1.5 g/dL over baseline with continued dosing for >12 consecutive weeks in the first 24 weeks of the trial.

The observed increases in erythropoietic markers corresponded with sustained decreases in ferritin and erythropoietin, which is consistent with upregulation of erythropoiesis.

An overall increase in platelet count was also observed in this patient.

• In a 75 year-old, transfusion-dependent male patient with high-risk myelofibrosis and severe thrombocytopenia in the combination arm, increases in reticulocytes and soluble transferrin receptor levels were observed following the first cycle of treatment.

Though platelet counts fluctuated over the treatment period, improvements were observed following the second and third cycles.

The patient experienced a reduction in red blood cell transfusion burden from nine units per 12 weeks pre-treatment to six units per 12 weeks post-treatment.

Clinical Development Strategy

We expect to complete enrollment in the transfusion-dependent cohorts in the Phase 2 clinical trial in patients with MDS in the second half of 2023, and expect to report additional data from Part 2 of the trial in the first half and the second half of 2023.

We also expect to expand this trial to MDS patients with iron overload in the second half of 2023.

Separately, we expect to announce dose escalation data from the Phase 2 clinical trial in patients with myelofibrosis-associated cytopenias and initiate Part 2 of this trial in the second half of 2023.

In December 2023, we presented additional data from this ongoing trial at the 65th ASH Annual Meeting and Exposition.

Safety data were presented for all patients that received at least one dose of KER-050 at one of four dose levels in Part 1 (n=41) as of September 14, 2023, which was the data cut-off date.

Evaluations of markers of hematopoiesis and anemia over 12 weeks, along with measurements of spleen volume and symptom scores (by the Myelofibrosis-Symptom Assessment form-Total Symptom Score, or MF-SAF-TSS) over 24 weeks, were presented for dose levels 1 through 3, ranging from 0.75 mg/kg to 3.0 mg/kg, which we refer to as the efficacy evaluable patients.

Data for dose level 4 (4.5 mg/kg), the highest dose level being evaluated in Part 1, were not included due to limited exposure as of the data cut-off date.

KER-050 was generally well tolerated by the safety population as of the data cut-off date.

There was one dose-limiting toxicity reported from a patient in the 1.5 mg/kg dose level of the monotherapy arm.

The patient had an increase in hemoglobin of at least 2 g/dL, which met protocol criteria for dose reduction at the end of cycle 1.

There were no adverse events associated with this event, and the maximum observed hemoglobin remained within normal limits.

There were three cases of fatal TEAEs in this trial that were each deemed unrelated to treatment.

The most commonly reported TEAEs (in ≥10% of patients) were diarrhea, thrombocytopenia, asthenia (weakness), fatigue and pyrexia (fever).

Treatment-related TEAEs were relatively infrequent, most of which were mild to moderate, with two patients experiencing Grade 3 or higher worsening cytopenias.

Additional data from the efficacy evaluable patients as of the data cut-off date include:

• Increases in hemoglobin were observed in non-transfusion dependent patients in both arms, suggesting that KER-050 has the potential to address anemia due to myelofibrosis and ruxolitinib-associated anemia.

◦ Additionally, most patients had reductions in transfusion burden, including patients receiving up to 15 red blood cell units per 12 weeks at baseline.

• Non-transfusion dependent patients, who received a median of three red blood cell units per 12 weeks at baseline, experienced sustained increases in hemoglobin within the first 12 weeks of treatment in both the monotherapy and combination arms (pooled across dose cohorts).

◦ Additionally, observed increases in soluble transferrin receptor, reticulocytes and hemoglobin were generally higher with increasing dose levels between 0.75 mg/kg to 3.0 mg/kg (pooled across both monotherapy and combination arms at each dose level).

• At Week 24, reduction in spleen size was observed in 57.1% (n=4/7) of patients with baseline spleen size ≥ 450 cm 3 and a Week 24 spleen assessment, including in one of three patients in the monotherapy arm and in three of four patients in the combination arm.

• At Week 24, a decrease in disease symptoms was observed in 66.7% (n=8/12) of patients with at least two symptoms with an average score ≥ 3 or an average total score of ≥ 10 on the MF-SAF-TSS questionnaire at baseline and a Week 24 MF-SAF-TSS assessment.

The data support the potential of KER-050 to ameliorate ineffective hematopoiesis and address cytopenias due to myelofibrosis and associated with ruxolitinib, and provide broader clinical benefit in patients as observed by the reduction in

spleen size and improvement in symptoms.

We expect to announce additional data from this trial in the second and fourth quarters of 2024.

Completed Phase 1 Clinical Trial

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We also believe that data from our preclinical studies and clinical trials support that treatment with KER-050 has the potential to address ineffective hematopoiesis in diseases where multiple cytopenias arise from the blockage in progression of progenitor cells to mature blood cells, such as in MDS and myelofibrosis.

For the Treatment of Functional Iron Deficiency

We are developing KER-047, our lead small molecule product candidate, for the treatment of functional iron deficiency.

We believe KER-047 is a potent and selective inhibitor of ALK2, a receptor whose excessive signaling is the underlying cause of the elevated levels of hepcidin, the key regulator of iron absorption and recycling, that leads to low iron bioavailability and anemia in a broad range of diseases.

Hepcidin and Iron Homeostasis

Iron supply in the bone marrow is critical for erythropoiesis, as iron is an essential component of hemoglobin.

Although iron is required for many functions in the body, including erythropoiesis, high iron levels are toxic, so circulating levels are regulated to avoid iron overload.

To maintain this balance, absorption of dietary iron is tightly controlled and recycled iron is held in the liver and macrophages, which we refer to as the storage tissues, to be mobilized quickly when circulating iron levels are too low.

These storage tissues also act to sequester away iron when levels are too high.

Hepcidin, a hormone produced by the liver, is the key regulator of iron absorption and recycling, and controls both the recirculation of iron from storage tissues as well as the absorption of dietary iron from the intestine.

Hepcidin levels are upregulated through activation of the ALK2 receptor, which is a BMP receptor belonging to the broader TGF-ß family of proteins.

Hepcidin levels are tightly regulated by liver cells through BMP6 signaling via ALK2.

High serum iron triggers the expression of BMP6, which then acts to increase hepcidin expression, resulting in iron sequestration, decreased iron absorption and reduced serum iron.

Hepcidin is controlled by a feedback loop, and serum hepcidin levels are inversely related to serum iron levels.

This feedback loop prevents this system from shifting out of balance.

The system is down regulated through the activity of matriptase-2, or MT-2, a cell surface protease, which is encoded by the TMPRSS6 gene.

This protein reduces the ability of BMP6 to signal through ALK2.

The below graphic illustrates a normal functioning of the negative feedback loop.

Regulation of Iron in the Body

Functional Iron Deficiency

Failure to suppress ALK2 signaling can result in elevated hepcidin levels, which are associated with decreased dietary iron absorption, increased iron sequestration in storage tissues and low iron bioavailability in the bone marrow.

These conditions of functional iron deficiency culminate in a shortage of serum iron, which leads to insufficient red blood cell production that manifests as mild to moderate anemia.

High hepcidin levels can also be the result of genetic disease.

Iron-refractory iron deficiency anemia, or IRIDA, is a rare, inherited form of iron deficiency anemia that results in loss of function of MT-2, resulting in elevated ALK2 signaling and high hepcidin levels.

Patients with IRIDA have the typical symptoms of anemia, including fatigue, weakness and shortness of breath, in addition to other symptoms associated with low iron.

These symptoms are most pronounced during childhood, although they tend to be mild.

The prevalence of IRIDA worldwide is estimated to be less than one person in 1,000,000.

IRIDA was first described in 1981 with the observation that patients with anemia were refractory to treatment with oral iron.

However, the association of mutations in the TMPRSS6 gene with IRIDA was not identified until 2008, and genetic testing for IRIDA is not widely available.

Furthermore, affected individuals usually have normal growth and development, so IRIDA is poorly diagnosed.

All these factors contribute to an inability to accurately determine the prevalence of IRIDA.

Hepcidin levels are also elevated due to chronic inflammation in MDS and myelofibrosis, which limits the availability of iron for hemoglobin production, resulting in anemia.

Red blood cell transfusions, which are used to treat anemia, can lead to iron overload and toxicity in cardiovascular and other tissues.

Limitations of Current Treatment Options for Functional Iron Deficiency

There are no current treatments that address the underlying cause of functional iron deficiency, including in patients with IRIDA and in MDS and myelofibrosis patients with functional iron deficiency.

Patients with functional iron deficiency anemia have elevated levels of hepcidin, potentially with accompanying iron overload in multiple organ systems.

This chronic iron overload can lead to multiple organ dysfunction, including in the liver, heart and endocrine.

Accordingly, iron chelation therapy is used to reduce iron deposits in those organs.

Iron chelators can be administered by intravenous or subcutaneous twice daily injections (deferoxamine) or taken orally once (deferasirox) to three times daily (deferiprone).

While orally available chelators, particularly Deferasirox (Exjade) are currently prescribed due to their ease of administration, some patients still need to receive deferoxamine infusions.

Regardless of administration profile, chelator use carries a known risk of severe side effects with several restrictions of use and black box warnings regarding potential renal, ophthalmic, hepatic and gastrointestinal, or GI, toxicity/failure, with common acute GI side effects including abdominal pain, diarrhea, nausea and vomiting.

The side effect profile as well as frequency of administration and perceived bad taste are reported as drivers of poor patient compliance with this existing treatment option.

We believe that a treatment option that reestablishes normal iron homeostasis has the potential to benefit a broad range of patients with functional iron deficiency.

Our Solution:

KER-047 is an orally-available small molecule ALK2 inhibitor designed to potently inhibit ALK2 signaling, with high selectivity for ALK2 relative to other structurally-similar TGF-ß receptors as well as other kinase families.

Mechanism of Action of KER-047

We believe that KER-047 has the potential to address the underlying cause of diseases arising from functional iron deficiency by suppressing ALK2 signaling to normalize hepcidin expression and mobilize iron out of tissues.

We believe this effect will result in increased iron bioavailability, resulting in restoration of the production of red blood cells and a reversal of anemia in patients with functional iron deficiency anemia and patients with IRIDA.

By ameliorating anemia arising from functional iron deficiency, we believe KER-047 can potentially eliminate the need for excessive supplementary iron or IV iron treatments and avoid the adverse events associated with those treatment options.

In addition, we believe KER-047, if approved, has the potential to mobilize excess iron being stored in tissues into the serum.

By ameliorating the excess iron in tissues, we believe KER-047 can potentially eliminate or reduce the need for phlebotomy and/or treatment with iron chelators, while allowing patients to avoid the adverse events associated with these treatments and providing benefit to patients where the current treatment options are largely ineffective.

Ongoing Phase 2 Clinical Trial in Patients with IRIDA

We are conducting an open label, two-part, dose-escalation and dose-expansion Phase 2 clinical trial to evaluate KER-047 in patients with IRIDA.

The primary objective of this trial is to assess the safety of KER-047.

The secondary objectives of this trial are to evaluate the pharmacokinetics and pharmacodynamics of KER-047.

We expect to use the data from Part 1 of this trial to select the dose level and duration to be evaluated in Part 2 of this trial.

The trial design is summarized in the figure below.

Phase 2 Clinical Trial Design

In December 2022, we presented data from one patient enrolled in Cohort 1 of Part 1 of this trial who completed the 14-day treatment and washout periods, at the 64th ASH Annual Meeting and Exposition.

Treatment with KER-047 was generally well tolerated by this patient, with no serious adverse events or dose-limiting toxicities reported during treatment.

There was one TEAE reported, which was determined to be unrelated to the treatment.

In this patient, hepcidin and serum ferritin levels decreased following administration of KER-047.

Serum ferritin returned to baseline levels in the washout period, indicating that the effect was potentially treatment-associated.

Reticulocyte hemoglobin also increased in this patient during the treatment period.

Taken together, these data are suggestive of iron redistribution consistent with the mechanism of action of KER-047.

Clinical Development Strategy

We expect to report additional data from Part 1 of the Phase 2 clinical trial in patients with IRIDA in the second half of 2023.

Completed Phase 1 Clinical Trial

In November 2020, we completed a randomized, double-blind, placebo-controlled, two-part Phase 1 clinical trial to evaluate single and multiple ascending doses of KER-047 in healthy volunteers.

The primary objectives of this trial were to assess safety, tolerability and pharmacokinetics of KER-047.

The trial design is summarized in the figure below.

Phase 1 Clinical Trial Design

Observed tolerability data

The majority of adverse events observed in this Phase 1 clinical trial were mild or moderate in severity, and only two were severe.

There were no serious adverse events reported in this trial.

The most common adverse events observed in healthy volunteers in this trial were abdominal discomfort, chills, decreased appetite, diarrhea, dizziness, fatigue, gastroenteritis, headache, lymphopenia, myalgia, nausea, neutropenia, pyrexia, rhinorrhea, tonsilitis, upper abdominal pain and vomiting.

In Part 2 of this trial, ten of 40 participants administered KER-047 and one of 11 participants administered placebo discontinued study drug due to adverse events.

Adverse events that led to study drug discontinuation in three or more participants in the KER-047 groups included lymphopenia and chills.

Lymphopenia, which we believe is consistent with KER-047’s mechanism of action, was observed after multiple doses and was reversible after discontinuation of study drug.

Rapid mobilization of iron stores resulted in increased reticulocyte hemoglobin content of newly-produced immature red blood cells

In this Phase 1 clinical trial, we observed rapid, robust and sustained dose-related increases in serum iron and transferrin saturation in the volunteers who received KER-047, which was associated with decreases in ferritin, an effect that is consistent with mobilization of iron stores.

We also observed a reduction in serum hepcidin in Cohorts 1 through 3 of Part 2 of this trial (50 mg, 100 mg and 200 mg dose groups), which we believe is consistent with KER-047’s mechanism of action.

These data were not collected in Part 1 of this trial or in Cohort 4 of Part 2 of this trial (350 mg dose group).

Part 2 of the Trial:

Hepcidin Percent Change from Baseline at Day 7, 8 Hours Post-Dose

Additionally, we observed a decrease in hepcidin as early as four hours after administration of the first dose in Cohort 5 of Part 2 of this trial (100 mg dose group).

We also observed an increase in reticulocyte hemoglobin in Cohorts 1 through 4 of Part 2 of this trial, starting on Day 4 of treatment.

Mean Reticulocyte Hemoglobin at Each Visit

We believe the observed decrease in ferritin and hepcidin coupled with the observed increases in reticulocyte hemoglobin content are indicative of increased iron mobilization.

Importantly, we believe the mobilized iron is available for incorporation into hemoglobin as evidenced by the increase in reticulocyte hemoglobin, a measure of hemoglobin content from newly-produced immature red blood cells.

These erythroid precursors potentially would continue maturation into hemoglobin-rich red blood cells.

We also observed decreases in lymphocytes following peak increases in serum iron in this trial, which we believe is consistent with KER-047’s mechanism of action and suggestive of depletion of tissue iron.

We believe the data from this Phase 1 clinical trial support the potential for KER-047 to be developed as a treatment for functional iron deficiency.

Observed reductions in total cholesterol

Reductions in total cholesterol, low-density lipoproteins, or LDL, and high-density lipoproteins were observed in Part 2 of this trial.

The reductions in total cholesterol and LDL were achieved rapidly with a mean reduction of greater than 20% at the highest dose, following seven days of dosing.

Preclinical Data

KER-047 was observed in preclinical studies to be a potent and highly selective ALK2 inhibitor and to change serum iron levels.

Specifically, KER-047 demonstrated in these studies:

▪ selectivity for ALK2 compared to other structurally-related TGF-ß and non-TGF-ß kinases;

▪ increased serum iron levels in rat studies;

▪ reversal of high hepcidin levels and low hemoglobin levels in a mouse model of IRIDA.

KER-047 observed to be a potent and highly selective ALK2 receptor inhibitor in a biochemical assay

In standard biochemical kinase screenings, KER-047 exhibited low nanomolar potency for ALK2.

Under the conditions of this assay, KER-047 exhibited at least an eight-fold selectivity over the other structurally-related TGF-ß kinases.

In a 370-member

kinase panel, only two non-TGF-ß kinases were inhibited less than 75% at a KER-047 concentration of 1 µM.

We believe these preclinical data further support the potency and selectivity of KER-047 for the ALK2 domain.

Highly Selective ALK2 Receptor Inhibitor

The kinase selectivity of KER-047 is shown in the dendrogram above.

Compounds were screened at 1 µM against a panel of over 370 kinases and disease-relevant mutants.

Each branch of the dendogram represents an individual human kinase.

Kinases bound by the compound are indicated by red circles on the kinome tree.

The degree of binding corresponds to the size of the circle.

As illustrated by the largest red circle in the above graphic, KER-047 was observed to be a potent ALK2 inhibitor and a weak inhibitor of other members of the TGF-ß family of receptors.

In cell-based assays that more directly tested the functional ability of KER-047 to suppress receptor signaling, KER-047 exhibited low nanomolar potency.

In assays evaluating the effect of KER-047 on receptors with the highest structural homology to ALK2, KER-047 had at least 20-fold selectivity for ALK2, compared to ALK1 and ALK5, which have 77% and 65% homology to ALK2, respectively.

KER-047 inhibition of ALK2 signaling resulted in increased serum iron and transferrin saturation in multiple animal models

We believe that data from preclinical studies support a link between ALK2 signaling, hepcidin expression and serum iron across multiple preclinical species in both healthy and disease models.

Serum iron is an indicator of whether there is adequate iron available in the body.

Total iron binding capacity is the measure of the maximum amount of iron that can be bound by transferrin, an iron-binding protein, and is a surrogate measurement of serum transferrin levels.

Transferrin saturation is calculated by dividing serum iron by total iron binding capacity and is an indicator of how well the body is transporting the iron in blood.

Taken together, these values are an indication of the state of iron balance in the body.

We evaluated serum iron, total iron binding capacity and transferrin saturation in Sprague-Dawley rats that received daily, oral administration of either vehicle or doses of 1 mg/kg, 2.5 mg/kg, 5 mg/kg or 15 mg/kg of KER-047 for three months.

Rats that were treated with KER-047 were observed to have a dose-dependent increase in serum iron levels and a concomitant increase in transferrin saturation, with no change in total iron binding capacity.

Increased Serum Iron, Total Iron Binding Capacity and Transferrin Saturation in Rats

These data demonstrate that ALK2 inhibition resulted in increased serum iron and that KER-047 acts by releasing iron into blood without altering the expression or functionality of iron binding proteins.

We believe that these data demonstrate that treatment with KER-047 has the potential to alter ALK2 signaling and release iron from storage tissue for transport to other tissues, including in the bone marrow.

Treatment with an ALK2 inhibitor closely related to KER-047 was also observed to reverse anemia in a mouse model of IRIDA.

To generate this mouse model, we used an siRNA directed against TMPRSS6, the same gene that is defective in patients with IRIDA, to render the mice TMPRSS6-deficient.

We confirmed that mice receiving the TMPRSS6 siRNA had a greater than 85% reduction of target gene expression relative to the control siRNA cohort.

This model recapitulated the increased hepcidin levels and reduced hemoglobin that are characteristic of patients with IRIDA.

Treatment of the mice receiving the TMPRSS6 siRNA with an ALK2 inhibitor normalized levels of both hepcidin gene expression and hemoglobin levels compared to the control siRNA cohort receiving vehicle treatment, which we believe indicates that ALK2 inhibition can reverse anemia resulting from iron imbalance.

Serum Hepcidin and Hemoglobin Levels in Mice with siRNA-induced IRIDA

The sequence of the ALK2 receptor has been highly conserved through evolution, with greater than 98% amino acid sequence homology between mice and humans.

Likewise, the finding that the mouse models with changes in ALK2 signaling recapitulate human disease also provides evidence that the function of the ALK2 receptor is conserved across species.

example, knockdown of the TMPRSS6 gene results in a phenocopy of the disease observed in patients with IRIDA.

We believe that the conservation of biology provides confidence that treatments that are efficacious in preclinical models will have similar effects in humans.

We further explored the results we observed in a mouse model of IRIDA by using a mouse model of anemia of inflammation via induced chronic kidney disease.

Inflammatory cytokines in chronic kidney diseases results in increased hepcidin, iron imbalance and anemia, and we believe a mouse model of chronic kidney disease is predictive of the broader indication of anemia of inflammation.

To generate this mouse model, mice were dosed daily for six weeks with 50 mg/kg of adenine to induce kidney damage, and subsequently developed inflammation-mediated anemia, with corresponding elevated levels of hepcidin and decreased serum iron.

Thereafter, mice continued to receive either vehicle or adenine daily, but also received daily treatment of either vehicle or 5 mg/kg of an ALK2 inhibitor closely related to KER-047 for ten days.

At termination of the preclinical study, mice receiving adenine in combination with the ALK2 inhibitor had serum iron values 108.2% higher than the vehicle-treated mice receiving adenine and vehicle.

Additionally, serum hepcidin was decreased by 85.4% over vehicle-treated mice.

These data substantiate the role of ALK2 signaling in anemia arising from high hepcidin and illustrate the potential therapeutic benefit of specific ALK2 inhibition in these diseases, including anemia of inflammation.

Our Pulmonary and Cardiovascular Franchise

KER-012 is a ligand trap comprised of a modified ligand-binding domain of ActRIIB that is fused to the portion of the human antibody known as the Fc domain.

KER-012 is designed to normalize blood vessel thickness and heart function by binding to and inhibiting the signaling of select TGF-ß ligands, including activin A, activin B and myostatin (GDF8), that stimulate smooth muscle hypertrophy and fibrosis, without a dose-limiting increase in red blood cells.

KER-012 is a ligand trap comprised of a modified ligand-binding domain of activin receptor type IIB, or ActRIIB, that is fused to the portion of the human antibody known as the Fc domain.

KER-012 is designed to normalize blood vessel thickness and heart function by binding to and inhibiting the signaling of select TGF-ß ligands, including activin A, activin B and myostatin (GDF8), that stimulate the proliferation of vascular endothelial and smooth muscle cells and fibroblasts, without a dose-limiting increase in red blood cells.

We believe that KER-012 has the potential to increase the signaling of BMP pathways through this inhibition of activin A and activin B signaling, and consequently treat diseases such as PAH that are associated with reduced BMP signaling due to inactivating mutations in the BMP receptors.

We are developing KER-012 for the treatment of PAH and for the treatment of cardiovascular disorders.

In May 2022, we announced preliminary topline results from Part 1 of our ongoing Phase 1 clinical trial evaluating single and multiple ascending doses of KER-012 in healthy volunteers and in September 2022, we announced preliminary clinical data from the Part 2 multiple ascending dose portion of this trial.

We expect to commence a Phase 2 clinical trial of KER-012 in patients with PAH in the first half of 2023 and an open-label Phase 2 biomarker clinical trial of KER-012 in the second half of 2023.

Pulmonary Arterial Hypertension

PAH is a debilitating disorder characterized by elevated pulmonary vascular resistance due to severe constriction and progressive obliteration of the pulmonary vessels.

PAH results in diminished oxygenation, impaired cardiac output and symptoms stemming from overload of the right ventricle, such as shortness of breath, fatigue, fainting, chest pain, palpitations and swelling of extremities and abdomen.

PAH is a debilitating disorder characterized by elevated pulmonary vascular resistance due to the progressive narrowing and obliteration of precapillary pulmonary arteries.

This increase in pulmonary vascular resistance results in severe elevation in pulmonary artery pressure, leading to right ventricular hypertrophy and ultimately, death from right heart failure.

Patients with PAH develop shortness of breath, fatigue, fainting, chest pain, palpitations and swelling of extremities and abdomen.

We estimate that there are approximately 40,000 addressable patients in the United States living with this condition.

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(ii) endothelin receptor antagonists, or ERAs;

or (iii) (a) phosphodiesterase 5 inhibitors, or PDE5i, which are agents that enhance nitric oxide metabolism, or (b) soluble guanylate cyclase activators, which cause downstream cGMP signaling.

or (iii) therapies that stimulate the nitric oxide-soluble guanylate cyclase-cyclic

guanosine monophosphate axis, such as (a) phosphodiesterase 5 inhibitors, or PDE5i, or (b) soluble guanylate cyclase activators, which augment cGMP signaling, a key mediator in pulmonary arterial vasodilation.

One common approach to treating early-stage or mild PAH is an oral combination therapy using ERA and PDE5i medications.

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Each of these individual therapies may modestly improve a patient’s functional status and in some cases survival, but is limited by systemic hypotension, systemic side effects and tachyphylaxis, which is an acute, sudden decrease in response to a product after its administration.

Additionally, combination therapy is

limited by the combined side effect profiles.

Although existing treatments may modestly slow the progression of PAH, none appear to halt or reverse the disease’s progression.

While the key physiologic and pathologic features of PAH include vasoconstriction, scar tissue and vascular smooth muscle cell proliferation and inflammation, the main pharmacological effect for all currently approved therapies is believed to be vasodilation.

Additionally, combination therapy is limited by the combined side effect profiles.

Although existing treatments may modestly slow the progression of PAH, none appear to fully halt or reverse the disease’s progression.

The key pathologic features of PAH include an unchecked proliferation of different vascular cells in the pulmonary arterial wall, including smooth muscle cells, endothelial cells and fibroblasts, and an exaggerated perivascular infiltration of inflammatory cells leading to a marked narrowing of small to medium sized pulmonary arteries.

However, most currently approved therapies lower pulmonary vascular resistance through vasodilatation and do not fully target the obliterative pulmonary vascular remodeling.

Accordingly, we believe there is a significant unmet need for a treatment that primarily targets the proliferative pathological processes and can be used alone or in combination with other PAH therapies.

We believe that potent therapies that do not exhibit tachyphylaxis, are orally bioavailable or do not require continuous infusion therapy would have advantages over the currently available treatments for PAH.

Therapies that arrest pulmonary vascular remodeling could have a long-term clinical stabilizing effect in PAH, or reverse vascular obliteration.

Therapies that delay or reverse the obliterative pulmonary vascular remodeling could have a long-term clinical stabilizing effect in PAH.

We believe that KER-012 has the potential to increase the signaling of BMP pathways through the inhibition of activin A and activin B signaling, and consequently treat diseases such as PAH that are associated with reduced BMP signaling due to inactivating mutations in the BMP receptors.

Ongoing Phase 2 Clinical Trial in Patients with Pulmonary Arterial Hypertension

We are conducting a randomized, double-blind, placebo-controlled Phase 2 clinical trial to evaluate KER-012 in combination with background therapy in adult patients with PAH, which we refer to as the TROPOS trial.

The primary objective of this trial is to evaluate the effect of KER-012 on hemodynamics compared to placebo in patients on background PAH therapy, and the primary endpoint is change from baseline in pulmonary vascular resistance at Week 24.

The key secondary objective of this trial is to evaluate the effect of KER-012 on exercise capacity compared to placebo in patients on background PAH therapy, and the key secondary endpoint is change from baseline in 6-minute walk distance at Week 24.

Additionally secondary objectives of this trial include evaluating the safety and tolerability of KER-012, the effects of KER-012 on N-terminal pro B-type natriuretic peptide, or NT-proBNP, a biomarker of myocardial stress, and the improvement in functional class of KER-012 compared to placebo.

The trial design is summarized in the figure below.

Phase 2 Clinical Trial Design

Approximately 90 patients diagnosed with PAH and on stable PAH background therapy will be randomized and assigned in a 2:2:2:3 ratio to the 1.5 mg/kg, 3.0 mg/kg, and 4.5 mg/kg KER-012 doses and placebo treatment arms.

We expect to provide an update on enrollment for the TROPOS trial in the first half of 2024.

Ongoing Phase 2 Clinical Trial in Patients with Chronic Heart Failure with Preserved Ejection Fraction or with Reduced Ejection Fraction

We have initiated an open-label, exploratory Phase 2 clinical trial to evaluate KER-012 in adult patients with chronic heart failure with preserved ejection fraction, or HFpEF, or with reduced ejection fraction, or HFrEF.

The primary objective of this trial is to evaluate the tolerability and safety of KER-012 administered as multiple subcutaneous doses once every four weeks

in patients with chronic heart failure.

In addition, this trial will explore pharmacokinetics, pharmacodynamic effects and NT-proBNP, a biomarker of myocardial stress.

Initially in this trial, six patients with HFpEF will be dosed with 4.5 mg/kg of KER-012 once every four weeks for up to 24 weeks.

Once all six patients have completed Study Day 29, the preliminary safety data will be reviewed by the Safety Review Committee.

If the Safety Review Committee recommends that the trial proceed, six further patients with HFrEF are expected to be enrolled.

These patients will also receive 4.5 mg/kg of KER-012 once every four weeks for up to 24 weeks.

After the last dose of KER-012, patients will enter into a safety follow-up period for eight weeks.

We expect to announce initial data from this trial in the second half of 2024.

Completed Phase 1 Clinical Trial in Healthy Volunteers

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The observed lack of effect on erythropoiesis in this trial is consistent with the lack of effect observed in our multiple preclinical models.

Clinical Development Strategy

We expect to commence a Phase 2 clinical trial evaluating KER-012 in patients with PAH in the first half of 2023.

We also expect to commence an open-label Phase 2 biomarker clinical trial of KER-012 in the second half of 2023.

Preclinical Data

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In preclinical studies conducted in wild-type mice, twice weekly intraperitoneal 20 mg/kg dosing of KER-012 increased bone mineral density compared to vehicle-treated mice 31 days post-treatment.

Additionally, we observed that treatment with KER-012 statistically significantly increased trabecular bone formation and mineral apposition rate, which we believe is consistent with an anabolic effect on bone.

Additionally, we observed that treatment with

KER-012 statistically significantly increased trabecular bone formation and mineral apposition rate, which we believe is consistent with an anabolic effect on bone.

Bone Mineral Density in Mice and Representative Microct Scans

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## P value <0.01, #### P value <0.0001 vs.

Our Obesity and Neuromuscular Franchise

KER-065 is a novel ligand trap comprised of a modified ligand-binding domain derived from ActRIIA and ActRIIB that is fused to the portion of the human antibody known as the Fc domain.

KER-065 is designed to act as a ligand trap and inhibit the biological effects of myostatin and activin A, two ligands that signal through activin receptors, to increase skeletal muscle, increase energy expenditure, reduce body fat, improve insulin resistance and improve cardiac function.

We are developing KER-065 for the treatment of obesity and for the treatment of neuromuscular diseases.

Obesity is a complex and chronic disease defined as having a body mass index, or BMI, of greater than or equal to 30, and is caused by abnormal or excessive fat accumulation due to an imbalance in energy intake and consumption over a long period of time.

There are many comorbidities associated with obesity, including type 2 diabetes, cardiovascular disease, hypertension, heart disease, sleep apnea and some cancers, as well as an increased risk of death.

According to the World Health Organization, in 2016, more than 1.9 billon adults worldwide were overweight, with 650 million considered to be obese.

The prevalence of obesity has tripled since 1975 and is projected to affect one billion people globally by 2030.

According to the U.S.

Centers for Disease Control and Prevention, the estimated annual medical cost of obesity in the United States was nearly $173.0 billion in 2019 dollars.

Limitations of Current Treatment Options for Obesity

The first-line treatment for obesity is lifestyle change brought about through a combination of diet, exercise and behavior therapy.

While lifestyle modifications can lead to weight loss, the magnitude required (approximately 10% to 15% of total body weight) to translate into clinical improvement for certain comorbid conditions, including obstructive sleep apnea and non-alcoholic steatotic hepatitis, is often difficult to achieve and sustain over time outside of a clinical trial setting.

A third-party retrospective observational study of over 10,000 obese participants enrolled in a medically supervised weight management program demonstrated an average weight loss of 5.8% from baseline over a five-year period.

GLP-1 is a metabolic hormone, or incretin, and GLP-1 receptor agonists represent an emerging class of therapies used to achieve weight loss.

Third-party clinical data with incretin-targeted therapeutics have demonstrated substantial and sustained reductions in body weight.

Semaglutide (Wegovy), a GLP-1 receptor agonist, and tirzepatide (Zepbound), a dual GLP-1/glucose-dependent insulinotropic polypeptide receptor agonist, are both approved in the United States for the treatment of obesity.

In a double-blind Phase 3 clinical trial of Wegovy, adults with obesity who did not have diabetes were randomly assigned, in a 2:1 ratio, to 68 weeks of treatment with once-weekly subcutaneous Wegovy (at a dose of 2.4 mg) or placebo, plus lifestyle intervention.

In this trial, the mean change in body weight from baseline to week 68 was −14.9% in the Wegovy group as compared with −2.4% in the placebo group.

However, based on the publicly reported data, we estimate that nearly 40% of the weight loss in a subpopulation assessed by dual energy X-ray absorptiometry (DEXA) was attributable to loss of lean mass, which could potentially lead to frailty.

Accordingly, we believe there is a need for a treatment option that leads to weight loss without an associated loss of muscle and the potential for premature onset of sarcopenia.

Based on our preclinical data, we believe that KER-065 has the potential to increase skeletal muscle in obese individuals and to reduce fat mass through an increase in energy expenditure, improve insulin sensitivity and improve cardiac function.

Additionally, we believe that KER-065 in combination with incretins has the potential to ameliorate muscle loss, further reduce fat mass and improve cardiac health directly.

Ongoing Phase 1 Clinical Trial in Healthy Volunteers

We have initiated a randomized, double-blind, placebo-controlled, two-part Phase 1 clinical trial to evaluate single and multiple ascending doses of KER-065 in healthy volunteers.

The primary objectives of this trial are to assess safety, tolerability and pharmacokinetics of KER-065.

Exploratory endpoints include assessments of the pharmacodynamic effect on bone, adipose, muscle, cardiac tissue and fibrosis.

To aid in the assessment of adipose tissue, volunteers will be required to have a BMI ≥ 27 to ≤ 33 kg/m2 to be enrolled in Part 2 of this trial.

The trial design is summarized in the figure below.

Phase 1 Clinical Trial Design

We expect to report initial data from this trial in the first quarter of 2025.

Following the completion of this trial, we plan to initiate a proof-of-concept trial of KER-065 in obese patients.

Preclinical Data

We have generated preclinical data that we believe demonstrated proof-of-mechanism of KER-065 for the treatment of obesity with a research form of KER-065, or RKER-065, and with a research form of another ActRII ligand trap closely related to KER-065, which we refer to as RKER-034, and for the treatment of neuromuscular diseases.

Specifically, in preclinical studies:

• KER-065 and KER-034 each showed high affinity for and potent inhibition of ligands involved in the regulation of muscle and bone homeostasis;

• RKER-065 and RKER-034 had equivalent increases in skeletal muscle in the diet-induced obesity model in mice;

• A combination treatment of RKER-034 and a GLP-1 receptor agonist increased lean mass in a diet-induced obesity model in mice, as compared to the loss of lean mass observed in obese mice treated with the GLP-1 receptor agonist alone;

• RKER-065 increased muscle mass, grip strength and trabecular bone in a mouse model of Duchenne muscular dystrophy, or DMD.

KER-065 targeted ligands that signal through ActRIIA and ActRIIB to increase skeletal muscle and bone in preclinical studies

KER-065 is a modified ActRII ligand trap that contains sequences from both wild-type ActRIIB and wild-type ActRIIA.

In preclinical studies, KER-065 bound to and inhibited multiple ligands that signal through these cell surface receptors, including activin A and myostatin (GDF8).

These ligands are key negative regulators of muscle and bone growth.

Consequently, we believe KER-065 has the potential to increase skeletal muscle and bone mass, increase fat metabolism and reduce fibrosis.

KER-034, a preclinical asset from our proprietary library of investigational ActRII ligand traps, is closely related to KER-065.

Similar to KER-065, KER-034 is designed to bind to and inhibit multiple TGF-ß ligands, including activin A and myostatin (GDF8), and has increased skeletal mass and bone in preclinical studies.

Treatment with RKER-065 increased muscle mass in the mouse model of diet-induced obesity

In preclinical studies conducted in obese mice on a high calorie diet, twice weekly dosing for four weeks of either 10 mg/kg of RKER-065, a research form of KER-065, or 10 mg/kg of RKER-034 resulted in equivalent increases in lean mass.

**** P value <0.0001

Twice weekly dosing of 0.041 mg/kg of semaglutide, or sema, resulted in loss of lean mass in the sema-treated obese mice.

The combination treatment of 10 mg/kg of RKER-034 and 0.041 mg/kg of sema increased lean mass, while a loss of lean mass was observed in sema-treated obese mice.

**** P value <0.0001

Twice weekly dosing of 0.041 mg/kg of sema and twice weekly dosing of 10 mg/kg of RKER-034 led to reductions in fat gain compared to untreated obese mice.

However, the combination treatment of 10 mg/kg of RKER-034 and 0.041 mg/kg of sema resulted in fat loss.

** P value <0.01

Additionally, once weekly dosing of 0.041 mg/kg of sema resulted in loss of muscle mass of tibialis anterior from the sema-treated obese mice.

The combination treatment of 10 mg/kg of RKER-034 and 0.041 mg/kg of sema increased tibialis anterior muscle mass, at equivalent levels to KER-034 treated mice.

ns=not significant;

**** P value <0.0001

Treatment with RKER-065 increased muscle mass, grip strength and trabecular bone in a mouse model of Duchenne Muscular Dystrophy

In preclinical studies conducted in the mdx mouse model of DMD, once weekly, intraperitoneal 10 mg/kg dosing of RKER-065 increased lean mass, forelimb grip strength and trabecular bone compared to vehicle-treated mice.

Our Preclinical Pipeline

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However, ActRIIB-Fc was also observed to cause nose and gum bleeding, which we believe is due to its effect of disrupting normal vascular remodeling.

BMP9 signaling is required for normal vascular remodeling, but is not involved in regulation of muscle or bone tissues.

BMP9 signaling is required for normal vascular remodeling, but is not involved in regulation of

muscle or bone tissues.

ActRIIB-Fc potently inhibits BMP9 signaling, which is the mechanism behind the bleeding events observed with ActRIIB-Fc treatment.

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▪ Molecules designed to increase muscle and bone mass with reduced BMP9 binding without impacting vascular remodeling that leads to weak blood vessels observed with the wild-type ActRIIB-Fc.

Our discovery approach has built on these initial observations to generate product candidates designed to target ActRII receptors without the liabilities observed in third-party preclinical studies and clinical trials of ActRIIA-Fc and ActRIIB-Fc.

We nominated KER-065, a preclinical asset, out of this proprietary library of ActRII ligand traps for further investigation.

KER-065 is a novel ligand trap comprised of a modified ligand-binding domain derived from ActRIIA and ActRIIB that is fused to the portion of the human antibody known as the Fc domain.

KER-065 is designed to bind to and inhibit TGF-ß ligands, including myostatin (GDF8) and activin A, which are negative regulators of muscle mass and strength.

Through inhibition of these TGF-ß ligands, we believe that KER-065 has the potential to induce a muscle anabolic effect.

KER-065 is also designed to inhibit TGF-ß ligands involved in bone remodeling, fat metabolism and fibrosis.

We believe that we are well positioned to advance our product candidates and realize the commercial opportunities in diseases where muscle and bone loss result in a debilitating impact on survival and quality of life, if our product candidates are successfully developed and approved.

Our discovery approach has built on these initial observations to generate product candidates designed to target ActRII receptors without certain downsides observed in third-party preclinical studies and clinical trials of ActRIIA-Fc and ActRIIB-Fc.

We believe that we are well positioned to advance our product candidates and pursue the commercial opportunities in diseases where muscle and bone loss result in a debilitating impact on survival and quality of life, if our product candidates are successfully developed and approved.

Our deep knowledge and expertise of the TGF-ß family of proteins provides a streamlined approach to screen and develop novel product candidates for hematological, pulmonary and cardiovascular disorders.

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We do not currently have arrangements in place for redundant supply.

We have been and are continuing to closely monitor the impact of the COVID-19 pandemic on our ability to procure sufficient supplies for the development of our product candidates, and are working with our CMOs to manage this process.

However, we could be unable to find alternative suppliers of acceptable quality, in the appropriate volumes and at an acceptable cost, if needed.

We could be unable to find alternative suppliers of acceptable quality, in the appropriate volumes and at an acceptable cost, if needed.

As our development programs expand and we build new process efficiencies, we expect to continually evaluate this strategy with the objective of satisfying demand for registration trials and, if approved, the manufacture, sale and distribution of commercial products.

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While we believe that our product candidates, discovery programs, technology, knowledge, experience and scientific resources provide us with competitive advantages, we compete in the highly competitive markets and face significant competition from many sources, including pharmaceutical and biotechnology companies, as well as academic institutions, governmental agencies and private and public research institutions.

We compete in the segments of the biotechnology, pharmaceutical and other related industries that develop and market therapies for the treatment of hematological, pulmonary and cardiovascular disorders.

We compete in the segments of the biotechnology, pharmaceutical and other related industries that develop and market therapies in our target indications.

There are many other companies, including large biotechnology and pharmaceutical companies, that have commercialized and/or are developing therapies for the same therapeutic areas that our product candidates target.

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(which was acquired by Merck & Co.

in November 2021), or Acceleron, Bristol-Myers Squibb Company and Disc Medicine are developing product candidates targeting diseases associated with MDS and myelofibrosis, including chronic anemia.

Additionally, in April 2020, Acceleron received FDA approval of its product, Reblozyl, for the treatment of anemia failing an erythropoiesis stimulating agent and requiring two or more red blood cell units over eight weeks in adult patients with very low- to intermediate-risk MDS with ring sideroblasts or with myelodysplastic/myeloproliferative neoplasm with ring sideroblasts and thrombocytosis.

In June 2020, Acceleron further announced that the European Commission approved Reblozyl for the treatment of transfusion-dependent anemia in adult patients with MDS or beta thalassemia and in September 2020, Acceleron announced that Health Canada approved Reblozyl for the treatment of adult patients with red blood cell transfusion-dependent anemia associated with beta thalassemia.

in November 2021), or Merck, Bristol-Myers Squibb Company and Disc Medicine are developing product candidates targeting diseases associated with MDS and myelofibrosis, including chronic anemia.

Additionally, in April 2020, Merck and Bristol-Myers Squibb Company received FDA approval of its product, Reblozyl, for the treatment of anemia failing an erythropoiesis stimulating agent and requiring two or more red blood cell units over eight weeks in adult patients with very low- to intermediate-risk MDS with ring sideroblasts or with myelodysplastic/myeloproliferative neoplasm with ring sideroblasts and thrombocytosis.

In June 2020, Merck further announced that the European Commission approved Reblozyl for the treatment of transfusion-dependent anemia in adult patients with MDS or beta thalassemia and in September 2020, Merck announced that Health Canada approved Reblozyl for the treatment of adult patients with red blood cell transfusion-dependent anemia associated with beta thalassemia.

Geron Corporation is developing imetelstat as a treatment for MDS and for myelofibrosis.

Sierra Oncology (which was acquired by GSK plc in July 2022) is developing momelotinib as a treatment for myelofibrosis.

Additionally, Constellation Pharmaceutics, Inc.

(which was acquired by MorphoSys AG in July 2021) is also developing a product candidate as a treatment for myelofibrosis, and Incyte Corporation is developing an ALK2 inhibitor product candidate for the treatment of myelofibrosis.

In August 2023, Bristol-Myers Squibb Company announced that the FDA approved Reblozyl for the treatment of anemia without previous erythropoiesis stimulating agent use (ESA-naïve) in adult patients with very low- to intermediate-risk MDS who may require regular red blood cell transfusions.

In March 2022, CTI BioPharma Corp.

received FDA accelerated approval of its product, pacritinib (Vonjo), for the treatment of adults with intermediate or high-risk primary or secondary (post-polycythemia vera or post-essential thrombocythemia) myelofibrosis with a platelet count below 50 × 10 9 /L.

(which was acquired by Swedish Orphan Biovitrum AB in June 2023) received FDA accelerated approval of its product, pacritinib (Vonjo), for the treatment of adults with intermediate or high-risk primary or secondary (post-polycythemia vera or post-essential thrombocythemia) myelofibrosis with a platelet count below 50 × 109/L.

In September 2023, GSK plc announced that the FDA approved its product, Ojjaara, for the treatment of intermediate or high-risk myelofibrosis, including primary myelofibrosis or secondary myelofibrosis (post-polycythaemia vera and post-essential thrombocythaemia), in adults with anemia.

Additionally, MorphoSys AG is also developing a product candidate as a treatment for myelofibrosis, and Incyte Corporation is developing an ALK2 inhibitor product candidate for the treatment of myelofibrosis.

Other companies that are developing product candidates that are designed to target the TGF-ß signaling pathways include Scholar Rock Holding Corporation, Biogen Inc.

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are also developing clinical-stage product candidates, AV-101 and seralutinib, respectively, for the treatment of PAH.

Wegovy, a GLP-1 receptor agonist, and Zepbound, a dual GLP-1/glucose-dependent insulinotropic polypeptide receptor agonist, are both approved in the United States for the treatment of obesity.

Additionally, Scholar Rock Holding Corporation is advancing an antimyostatin monoclonal antibody candidate for evaluation in cardiometabolic disorders, including obesity, Biohaven Ltd.

is developing taldefgrobep alfa, a myostatin inhibitor, as a potential treatment approach for obesity, Versanis Bio (which was acquired by Eli Lilly and Company in August 2023) is developing bimagrumab, an anti-ActRII product candidate, for the treatment of obesity, and Regeneron Pharmaceuticals, Inc.

is developing trevogrumab, an antimyostatin monoclonal antibody candidate, and garetosmab, an anti-activin A product candidate, in obesity.

Many of the companies against which we are competing or against which we may compete in the future, either alone or with their strategic collaborators, have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved drugs than we do.

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In addition, Hansoh will use commercially reasonable efforts to develop, obtain regulatory approval for, and commercialize licensed products in any region in the Territory.

Pursuant to the terms of the Hansoh Agreement, we received a net $18.0 million upfront payment in 2022.

Pursuant to the terms of the Hansoh Agreement, we received an upfront payment in 2022.

In addition to the upfront payment, we are entitled to receive up to an aggregate of (i) $26.5 million upon the achievement of specified development milestones and (ii) $144.0 million upon the achievement of specified net sales thresholds for all licensed products in the Territory.

If a licensed product is approved for marketing in the Territory, we will be entitled to receive royalty payments based on a tiered percentage of annual net sales in each region within the Territory, with such percentage ranging from the low double digit to high teens, subject to specified potential royalty reductions.

Hansoh’s obligation to pay royalties for a given licensed product in a given region in the Territory will begin on the date of the first commercial sale for such licensed product in such region and continue until the latest of (i) ten years from the date of the first commercial sale for such licensed product in such region, (ii) the expiration of the last valid claim of certain licensed patents or joint patents, and (iii) expiration of regulatory exclusivity in such region.

patents or joint patents, and (iii) expiration of regulatory exclusivity in such region.

During the royalty term, neither party will directly or indirectly commercialize a competing product in the Territory.

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Intellectual property rights may not address all potential threats to our competitive advantage

As of February 28, 2023, our patent portfolio consisted of nine issued U.S.

As of February 23, 2024, our patent portfolio consisted of 12 issued U.S.

patents, 32 pending U.S.

patent applications, eight issued ex-U.S.

patent applications, 12 issued ex-U.S.

patents and 99 pending ex-U.S.

applications, with expected expiry dates not earlier than between March 13, 2029 and November 10, 2043.

Of these, nine issued patents and 81 patent applications relate to KER-050, KER-047 and KER-012, and eight issued patents and 34 patent applications relate to other technologies, in each case as described in more detail below.

applications, with expected expiry dates not earlier than between March 13, 2029 and February 13, 2045.

Of these, 11 issued patents and 94 patent applications relate to KER-050, KER-012 and KER-065, and 13 issued patents and 37 patent applications relate to other technologies, in each case as described in more detail below.

Each of our pending international patent applications has been filed under the Patent Cooperation Treaty and has not yet entered any national jurisdictions.

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KER-050 is a modified ActRIIA ligand trap that is designed to bind to different TGF-ß ligands that signal through a TGF-ß signaling pathway.

We own three issued U.S.

patents, three issued ex-U.S.

We own four issued U.S.

patents, six issued ex-U.S.

patents, 14 pending U.S.

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applications that contain claims or supporting disclosure directed to ActRIIA ligand traps and use thereof to treat muscle disease, bone disease, metabolic disease, anemia, fibrosis, pulmonary hypertension, thrombocytopenia, and neutropenia, among others.

Any patents issuing from these applications will have expiration dates between November 9, 2037 and August 19, 2042, absent any patent term adjustments or extensions.

KER-047 is an orally available small molecule ALK2 inhibitor designed to potently and selectively inhibit ALK2 signaling.

We own six pending U.S.

patent applications and seven pending ex-U.S.

applications that contain claims or supporting disclosure directed to crystal forms of an ALK2 inhibitor and uses of small molecule ALK2 inhibitors.

Any patents issuing from these applications will have expiration dates between October 25, 2039 and November 2, 2042, absent any patent term adjustments or extensions.

We have exclusively licensed from The General Hospital Corporation rights in one patent family related to novel ALK2 inhibitors.

Patents in this family are expected to expire on April 26, 2038, absent any patent term adjustments or extensions.

Any patents issuing from these applications will have expiration dates between November 9, 2037 and February 13, 2045, absent any patent term adjustments or extensions.

KER-012 is a modified ActRIIB ligand trap that is designed to bind to different TGF-ß ligands that signal through a TGF-ß signaling pathway.

We own ten pending U.S.

We own one issued U.S.

patent, 15 pending U.S.

patent applications and 23 pending ex-U.S.

applications that contain claims or supporting disclosure directed to ActRIIB ligand traps and use thereof to treat muscle disease, bone disease, anemia, fibrosis, pulmonary hypertension, metabolic disease, thrombocytopenia, and neutropenia, among others.

Any patents issuing from these applications will have expiration dates between January 11, 2039 and September 9, 2043, absent any patent term adjustments or extensions.

Any patents issuing from these applications will have expiration dates between January 11, 2039 and February 13, 2045, absent any patent term adjustments or extensions.

KER-065 is a ligand trap comprised of a modified ligand-binding domain derived from ActRIIA and ActRIIB that is designed to bind to different TGF-ß ligands that signal through a TGF-ß signaling pathway.

We own 13 pending U.S.

patent applications and 20 pending ex-U.S.

applications that contain claims or supporting disclosure directed to ligand traps comprised of a modified ligand-binding domain derived from ActRIIA and ActRIIB and use thereof to treat muscle disease, bone disease, anemia, fibrosis, pulmonary hypertension, metabolic disease, thrombocytopenia, and neutropenia, among others.

Any patents issuing from these applications will have expiration dates between March 19, 2041 and February 13, 2045, absent any patent term adjustments or extensions.

We plan to seek United States and international patent protection for a variety of additional technologies.

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patent applications and 23 pending ex-U.S.

applications that contain claims or supporting disclosure directed to GDNF fusion polypeptides, ALK2 antibodies, and ActRII chimera ligand traps.

applications that contain claims or supporting disclosure directed to GDNF fusion polypeptides, ALK2 antibodies, crystal forms of an ALK2 inhibitor, ActRII chimera ligand traps, and uses of small molecule ALK2 inhibitors.

Any patents issuing from these applications will have expiration dates between November 9, 2037 and November 9, 2043, absent any patent term adjustments or extensions.

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In addition, our trade secrets may otherwise become known or be independently discovered by competitors.

To the extent that our collaborators, employees and consultants use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.

To the extent that our collaborators, employees and consultants use intellectual

property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.

Our commercial success will also depend in part on not infringing upon the proprietary rights of third parties.

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Prior to beginning the first clinical trial with a product candidate, we must submit the results of the preclinical studies, together with manufacturing information, analytical data, any available clinical data or literature and a proposed clinical protocol, to the FDA as part of an IND.

An IND is a request for authorization from the FDA to administer an investigational new drug product to humans.

An IND is a request for authorization from the FDA to administer an investigational new drug product

The IND submission contains the general investigational plan and the protocol or protocols for preclinical studies and clinical trials, as well as results of in vitro and animal studies assessing the toxicology, pharmacokinetics, pharmacology and pharmacodynamic characteristics of the product, chemistry, manufacturing and controls information, and any available human data or literature to support the use of the investigational product.

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Furthermore, each clinical trial must be reviewed and approved by an independent IRB for each institution at which the clinical trial will be conducted to ensure that the risks to individuals participating in the clinical trials are minimized and are reasonable in relation to anticipated benefits.

approves the informed consent form that must be provided to each clinical trial subject or his or her legal representative, and must monitor the study until completed.

The IRB also approves the informed consent form that must be provided to each clinical trial subject or his or her legal representative, and must monitor the study until completed.

Regulatory authorities, the IRB or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the subjects are being exposed to an unacceptable health risk or that the trial is unlikely to meet its stated objectives.

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

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

Additionally, appropriate

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

During all phases of clinical development, regulatory agencies require extensive monitoring and auditing of all clinical activities, clinical data, and clinical study investigators.

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The NDA or BLA is a request for approval to market the drug or biologic for one or more specified indications and must contain proof of safety and efficacy for a drug or safety, purity and potency for a biologic.

The application must include all relevant data

available from pertinent preclinical studies and clinical trials, including negative or ambiguous results of preclinical studies and clinical trials, as well as positive findings, together with detailed information relating to the product’s chemistry, manufacturing, controls, and proposed labeling, among other things.

The application must include all relevant data available from pertinent preclinical studies and clinical trials, including negative or ambiguous results of preclinical studies and clinical trials, as well as positive findings, together with detailed information relating to the product’s chemistry, manufacturing, controls, and proposed labeling, among other things.

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

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Additionally, the FDA may refer applications for novel products or products which present difficult questions of safety or efficacy 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 the advisory committee, but it considers such recommendations when making decisions on approval.

The FDA is not bound by recommendations of the advisory committee, but it considers such

recommendations when making decisions on approval.

Additionally, before approving an NDA or BLA, the FDA will typically inspect one or more clinical sites to assure compliance with GCPs.

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In issuing the Complete Response letter, the FDA may recommend actions that the applicant might take to place the application in condition for approval, including requests for additional information or clarification, which may include the potential requirement for additional clinical studies, including the potential requirement to conduct additional clinical trial(s) and/or to complete other significant and time-consuming requirements related to clinical trials, or to conduct additional preclinical studies or manufacturing activities.

If a Complete Response Letter is issued, the applicant may either resubmit the NDA or BLA, addressing all of the deficiencies

identified in the letter, or withdraw the application or request an opportunity for a hearing.

If a Complete Response Letter is issued, the applicant may either resubmit the NDA or BLA, addressing all of the deficiencies identified in the letter, or withdraw the application or request an opportunity for a hearing.

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

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A REMS is a safety strategy to manage a known or potential serious risk associated with a product and to enable patients to have continued access to such medicines by managing their safe use, and 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.

The FDA will not approve the NDA or BLA without an approved REMS, if required.

The FDA will not approve the NDA or BLA without an approved

REMS, if required.

The FDA also may condition approval on, among other things, changes to proposed labeling or the development of adequate controls and specifications.

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The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively the ACA, includes a subtitle called the Biologics Price Competition and Innovation Act of 2009, or BPCI Act, which created an abbreviated approval pathway for biological products shown to be similar to, or interchangeable with, an FDA-licensed reference biological product.

To date, only a handful of biosimilars have been licensed under the BPCIA, although numerous biosimilars have been approved in Europe.

To date, only a handful of biosimilars have been licensed under the BPCIA, although numerous biosimilars have been approved in the European Union.

The FDA has issued several guidance documents outlining an approach to review and approval of biosimilars.

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Whether or not we obtain FDA approval for a product, we would need to obtain the necessary approvals by the comparable foreign regulatory authorities before we can commence clinical trials or marketing of the product in foreign countries and jurisdictions.

Clinical Trials in the EU

Similar to the United States, the various phases of non-clinical and clinical research in the European Union, or the EU, are subject to significant regulatory controls.

In the EU, clinical trials are governed by the Clinical Trials Regulation (EU) No 536/2014, or CTR, which entered into application on January 31, 2022 repealing and replacing the former Clinical Trials Directive 2001/20, or CTD.

The CTR is intended to harmonize and streamline clinical trial authorizations, simplify adverse-event reporting procedures, improve the supervision of clinical trials and increase transparency.

Specifically, the CTR, which is directly applicable in all EU Member States, introduces a streamlined application procedure through a single-entry point, the "EU portal", the Clinical Trials Information System, or CTIS;

a single set of documents to be prepared and submitted for the application;

as well as simplified reporting procedures for clinical trial sponsors.

A harmonized procedure for the assessment of applications for clinical trials has been introduced and is divided into two parts.

Part I assessment is led by the competent authorities of a reference Member State selected by the trial sponsor and relates to clinical trial aspects that are considered to be scientifically harmonized across EU Member States.

This assessment is then submitted to the competent authorities of all concerned Member States in which the trial is to be conducted for their review.

Part II is assessed separately by the competent authorities and Ethics Committees in each concerned EU Member State.

Individual EU Member States retain the power to authorize the conduct of clinical trials on their territory.

The extent to which ongoing clinical trials will be governed by the CTR will depend on the duration of the individual clinical trial.

For clinical trials in relation to which an application for approval was made on the basis of the CTD before January 31, 2023, the CTD will continue to apply on a transitional basis until January 31, 2025.

By that date, all ongoing trials will become subject to the provisions of the CTR.

The CTR will apply to clinical trials from an earlier date if the related clinical trial application was made on the basis of the CTR or if the clinical trial has already transitioned to the CTR framework before January 31, 2025.

In all cases, clinical trials must be conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki.

Medicines used in clinical trials, including ATMPs, must be manufactured in accordance with the guidelines on cGMP and in a GMP licensed facility, which can be subject to GMP inspections.

EU Review and Approval Process

In the EU, medicinal products can only be commercialized after a related marketing authorization, or MA, has been granted.

To obtain an MA for a product in the EU, an applicant must submit a Marketing Authorization Application, or MAA, either under a centralized procedure administered by the European Medicines Agency, or EMA, or one of the procedures administered by the competent authorities of EU Member States (decentralized procedure, national procedure or mutual recognition procedure).

An MA may be granted only to an applicant established in the EU.

The centralized procedure provides for the grant of a single MA by the European Commission that is valid throughout the EEA (which is comprised of the 27 EU Member States plus Norway, Iceland and Liechtenstein).

Pursuant to Regulation (EC) No 726/2004, the centralized procedure is compulsory for specific products, including for (i) medicinal products derived from biotechnological processes, (ii) products designated as orphan medicinal products, (iii) advanced therapy medicinal products, or ATMPs, and (iv) products with a new active substance indicated for the treatment of HIV/AIDS, cancer, neurodegenerative diseases, diabetes, auto-immune and other immune dysfunctions and viral diseases.

For products with a new active substance indicated for the treatment of other diseases and products that are highly innovative or for which a centralized process is in the interest of patients, authorization through the centralized procedure is optional on related approval.

Under the centralized procedure, the EMA’s Committee for Medicinal Products for Human Use, or CHMP, conducts the initial assessment of a product.

The CHMP is also responsible for several post-authorization and maintenance activities, such as the assessment of modifications or extensions to an existing MA.

The maximum timeframe for the evaluation of an MAA under the centralized procedure is 210 days, excluding clock stops when additional information or written or oral explanation

is to be provided by the applicant in response to questions of the CHMP.

Accelerated assessment may be granted by the CHMP in exceptional cases, when a medicinal product targeting an unmet medical need is expected to be of major interest from the point of view of public health and, in particular, from the viewpoint of therapeutic innovation.

If the CHMP accepts a request for accelerated assessment, the time limit of 210 days will be reduced to 150 days (excluding clock stops).

The CHMP can, however, revert to the standard time limit for the centralized procedure if it considers that it is no longer appropriate to conduct an accelerated assessment.

Unlike the centralized authorization procedure, the decentralized MA procedure requires a separate application to, and leads to separate approval by, the competent authorities of each EU Member State in which the product is to be marketed.

This application is identical to the application that would be submitted to the EMA for authorization through the centralized procedure.

The reference EU Member State prepares a draft assessment and drafts of the related materials within 120 days after receipt of a valid application.

The resulting assessment report is submitted to the concerned EU Member States who, within 90 days of receipt, must decide whether to approve the assessment report and related materials.

If a concerned EU Member State cannot approve the assessment report and related materials due to concerns relating to a potential serious risk to public health, disputed elements may be referred to the Heads of Medicines Agencies’ Coordination Group for Mutual Recognition and Decentralised Procedures – Human, or CMDh, for review.

The subsequent decision of the European Commission is binding on all EU Member States.

The mutual recognition procedure allows companies that have a medicinal product already authorized in one EU Member State to apply for this authorization to be recognized by the competent authorities in other EU Member States.

Like the decentralized procedure, the mutual recognition procedure is based on the acceptance by the competent authorities of the EU Member States of the MA of a medicinal product by the competent authorities of other EU Member States.

The holder of a national MA may submit an application to the competent authority of an EU Member State requesting that this authority recognize the MA delivered by the competent authority of another EU Member State.

An MA has, in principle, an initial validity of five years.

The MA may be renewed after five years on the basis of a re-evaluation of the risk-benefit balance by the EMA or by the competent authority of the EU Member State in which the original MA was granted.

To support the application, the MA holder must provide the EMA or the competent authority with a consolidated version of the Common Technical Document providing up-to-date data concerning the quality, safety and efficacy of the product, including all variations introduced since the MA was granted, at least nine months before the MA ceases to be valid.

The European Commission or the competent authorities of the EU Member States may decide on justified grounds relating to pharmacovigilance, to proceed with one further five year renewal period for the MA.

Once subsequently definitively renewed, the MA shall be valid for an unlimited period.

Any authorization which is not followed by the actual placing of the medicinal product on the EU market (for a centralized MA) or on the market of the authorizing EU Member State within three years after authorization ceases to be valid (the so-called sunset clause).

Innovative products that target an unmet medical need and are expected to be of major public health interest may be eligible for a number of expedited development and review programs, such as the Priority Medicines, or PRIME, scheme, which provides incentives similar to the breakthrough therapy designation in the U.S.

PRIME is a voluntary scheme aimed at enhancing the EMA’s support for the development of medicinal products that target unmet medical needs.

Eligible products must target conditions for which there is an unmet medical need (there is no satisfactory method of diagnosis, prevention or treatment in the EU or, if there is, the new medicinal product will bring a major therapeutic advantage) and they must demonstrate the potential to address the unmet medical need by introducing new methods of therapy or improving existing ones.

Benefits accrue to sponsors of product candidates with PRIME designation, including but not limited to, early and proactive regulatory dialogue with the EMA, frequent discussions on clinical trial designs and other development program elements, and potentially accelerated MAA assessment once a dossier has been submitted.

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 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.

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

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

Like a conditional MA, an MA granted in exceptional circumstances is reserved to medicinal products intended to be authorized for treatment of rare diseases or unmet medical needs for which the applicant does not hold a complete data set that is required for the grant of a standard

However, unlike the conditional MA, an applicant for authorization in exceptional circumstances is not subsequently required to provide the missing data.

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

Pediatric Development in the EU

In the EU, Regulation (EC) No 1901/2006 provides that all MAAs for new medicinal products have to include the results of trials conducted in the pediatric population, in compliance with a pediatric investigation plan, or PIP, agreed with the EMA’s Pediatric Committee, or PDCO.

The PIP sets out the timing and measures proposed to generate data to support a pediatric indication of the medicinal product for which MA is being sought.

The PDCO can grant a deferral of the obligation to implement some or all of the measures provided in the PIP until there are sufficient data to demonstrate the efficacy and safety of the product in adults.

Further, the obligation to provide pediatric clinical trial data can be waived by the PDCO when these data are not needed or appropriate.

because the product is likely to be ineffective or unsafe in children, the disease or condition for which the product is intended occurs only in adult populations, or when the product does not represent a significant therapeutic benefit over existing treatments for pediatric patients.

Once the MA is obtained in all EU Member States and study results are included in the product information, even when negative, the product is eligible for a six-month extension to the Supplementary Protection Certificate, or SPC, if any is in effect at the time of authorization or, in the case of orphan medicinal products, a two-year extension of orphan market exclusivity.

Manufacturing Regulation in the EU

In addition to an MA, various other requirements apply to the manufacturing and placing on the EU market of medicinal products.

The manufacturing of medicinal products in the EU requires a manufacturing authorization and import of medicinal products into the EU requires a manufacturing authorization allowing for import.

The manufacturing authorization holder must comply with various requirements set out in the applicable EU laws, regulations and guidance, including EU cGMP standards.

Similarly, the distribution of medicinal products within the EU is subject to compliance with the applicable EU laws, regulations and guidelines, including the requirement to hold appropriate authorizations for distribution granted by the competent authorities of EU Member States.

Marketing authorization holders and/or manufacturing and import authorization, or MA holders and/or distribution authorization holders may be subject to civil, criminal or administrative sanctions, including suspension of manufacturing authorization, in case of non-compliance with the EU or EU Member States’ requirements applicable to the manufacturing of medicinal products.

Data and Market Exclusivity in the EU

The EU provides opportunities for data and market exclusivity related to MAs.

Upon receiving an MA, innovative medicinal products are generally entitled to receive eight years of data exclusivity and 10 years of market exclusivity.

Data exclusivity, if granted, prevents regulatory authorities in the EU from referencing the innovator’s data to assess a generic application or biosimilar application for eight years from the date of authorization of the innovative product, after which a generic or biosimilar MAA can be submitted, and the innovator’s data may be referenced.

The market exclusivity period prevents a successful generic or biosimilar applicant from commercializing its product in the EU until 10 years have elapsed from the initial MA of the reference product in the EU.

The overall ten-year period may, occasionally, be extended for a further year to a maximum of 11 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/biological entity, and products may not qualify for data exclusivity.

In the EU, 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 such products, the results of appropriate preclinical or clinical trials must be provided in support of an application for MA.

Guidelines from the EMA detail the type of quantity of supplementary data to be provided for different types of biological product.

Orphan Designation in the EU

In the EU, Regulation (EC) No.

141/2000, as implemented by Regulation (EC) No.

847/2000 provides that a medicinal product can be designated as an orphan medicinal product by the European Commission if its sponsor can establish that:

(i) the product is intended for the diagnosis, prevention or treatment of life-threatening or chronically debilitating conditions;

(ii) either (a) such conditions affect not more than 5 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 the necessary investment in developing the medicinal product;

and (iii) there exists no satisfactory authorized method of diagnosis, prevention, or treatment of the condition that has been authorized in the EU, or even if such method exists, the product will be of significant benefit to those affected by that condition.

Regulation (EC) No 847/2000 sets out further provisions for implementation of the criteria for designation of a medicinal product as an orphan medicinal product.

An application for the designation of a medicinal product as an orphan medicinal product must be submitted at any stage of development of the medicinal product but before filing of an MAA.

An MA for an orphan medicinal product may only include indications designated as orphan.

For non-orphan indications treated with the same active pharmaceutical ingredient, a separate marketing authorization has to be sought.

Orphan medicinal product designation entitles an applicant to incentives such fee reductions or fee waivers, protocol assistance, and access to the centralized marketing authorization procedure.

Upon grant of a marketing authorization, orphan medicinal products are entitled to a ten-year period of market exclusivity for the approved therapeutic indication, which means that the EMA cannot accept another marketing authorization application or accept an application to extend for a similar product and the European Commission cannot grant a marketing authorization for the same indication for a period of ten years.

The period of market exclusivity is extended by two years for orphan medicinal products that have also complied with an agreed PIP.

No extension to any supplementary protection certificate can be granted on the basis of pediatric studies for orphan indications.

Orphan medicinal product designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.

The period of market exclusivity may, however, be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria on the basis of which it received orphan medicinal product destination, including where it can be demonstrated on the basis of available evidence that the original orphan medicinal product is sufficiently profitable not to justify maintenance of market exclusivity or where the prevalence of the condition has increased above the threshold.

Additionally, an MA may be granted to a similar medicinal product with the same orphan indication during the 10 year period if:

(i) if the applicant consents to a second original orphan medicinal product application, (ii) if the manufacturer of the original orphan medicinal product is unable to supply sufficient quantities;

or (iii) if the second applicant can establish that its product, although similar, is safer, more effective or otherwise clinically superior to the original orphan medicinal product.

A company may voluntarily remove a product from the register of orphan products.

Post-authorization Requirements in the EU

Where an MA is granted in relation to a medicinal product in the EU, the holder of the MA is required to comply with a range of regulatory requirements applicable to the manufacturing, marketing, promotion and sale of medicinal products.

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 individual EU Member States.

The holder of an MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance who is responsible for oversight of that system.

Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports, or PSURs.

All new MAAs must include a risk management plan, or RMP, describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated with the product.

The regulatory authorities may also impose specific obligations as a condition of the MA.

Such risk- minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies.

In the EU, the advertising and promotion of medicinal products are subject to both EU and EU Member States’ laws governing promotion of medicinal products, interactions with physicians and other healthcare professionals, misleading and comparative advertising and unfair commercial practices.

General requirements for advertising and promotion of medicinal products, such as direct-to-consumer advertising of prescription medicinal products are established in EU law.

However, the details are governed by regulations in individual EU Member States and can differ from one country to another.

For example, applicable laws require that promotional materials and advertising in relation to medicinal products comply with the product’s Summary of Product Characteristics, or SmPC, which may require approval by the competent national authorities in connection with an MA.

The SmPC is the document that provides information to physicians concerning the safe and effective use of the product.

Promotional activity that does not comply with the SmPC is considered off-label and is prohibited in the EU.

Other Healthcare Laws and Compliance Requirements

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The term remuneration has been interpreted broadly to include anything of value, including stock options.

federal Anti-Kickback Statute has been interpreted to apply to arrangements between pharmaceutical manufacturers on one hand and prescribers, purchasers, and others on the other hand.

federal Anti-Kickback Statute has been interpreted to apply to arrangements between pharmaceutical manufacturers on one hand

and prescribers, purchasers, and others on the other hand.

There are a number of statutory exceptions and regulatory safe harbors protecting some common activities from prosecution, but they are drawn narrowly, and practices that involve remuneration, such as consulting agreements, that may be alleged to be intended to induce prescribing, purchasing or recommending may be subject to scrutiny if they do not qualify for an exception or safe harbor.

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Significant uncertainty exists as to the coverage and reimbursement status of any pharmaceutical or biological product for which we obtain regulatory approval.

Sales of any product, if approved, depend, in part, on the extent to which such product

will be covered by third-party payors, such as federal, state, and foreign government healthcare programs, commercial insurance and managed healthcare organizations, and the level of reimbursement, if any, for such product by third-party payors.

Sales of any product, if approved, depend, in part, on the extent to which such product will be covered by third-party payors, such as federal, state, and foreign government healthcare programs, commercial insurance and managed healthcare organizations, and the level of reimbursement, if any, for such product by third-party payors.

No uniform policy for coverage and reimbursement exists in the United States, and coverage and reimbursement can differ significantly from payor to payor.

Decisions regarding whether to cover any of our product candidates, if approved, the extent of coverage and amount of reimbursement to be provided are made on a plan-by-plan basis Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement rates, but also have their own methods and approval process apart from Medicare determinations.

rely upon Medicare coverage policy and payment limitations in setting their own reimbursement rates, but also have their own methods and approval process apart from Medicare determinations.

As a result, the coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our product candidates to each payor separately, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance.

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No regulatory authority has granted approval for a personalized cancer immunotherapy based on a vaccine approach, and there is no model for reimbursement of this type of product.

In the EU, pricing and reimbursement schemes vary widely from country to country.

Some EU Member States may approve a specific price for a product, or they may instead adopt a system of direct or indirect controls on the profitability of the company placing the product on the market.

Other EU Member States allow companies to fix their own prices for products but monitor and control prescription volumes and issue guidance to physicians to limit prescriptions.

In addition, some EU Member States may require the completion of additional studies that compare the cost-effectiveness of a particular medicinal product candidate to currently available therapies.

This Health Technology Assessment, or HTA, process is the procedure according to which the assessment of the public health impact, therapeutic impact and the economic and societal impact of use of a given medicinal product in the national healthcare systems of the individual country is conducted.

The outcome of HTA regarding specific medicinal products will often influence the pricing and reimbursement status granted to these medicinal products by the competent authorities of individual EU Member States.

In December 2021, Regulation No 2021/2282 on Health Technology Assessment, or HTA Regulation, was adopted.

The HTA Regulation is intended to boost cooperation among EU Member States in assessing health technologies, including new medicinal products, and providing the basis for cooperation at EU level for joint clinical assessments in these areas.

When it enters into application in 2025, the HTA Regulation will be intended to harmonize the clinical benefit assessment of HTA across the European Union.

Healthcare Reform

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Supreme Court ruling, on January 28, 2021, President Biden issued an executive order that initiated a special enrollment period for purposes of obtaining health insurance coverage through the ACA marketplace, which began on February 15, 2021 and remained open through August 15, 2021.

The executive order also instructed certain governmental agencies to review and reconsider their existing policies and rules that limit access to healthcare, including among others, reexamining Medicaid demonstration projects and waiver programs that include work requirements, and policies that create unnecessary barriers to obtaining access to health insurance coverage through Medicaid or the ACA.

The executive order also instructed certain governmental agencies to review and reconsider their existing policies

and rules that limit access to healthcare, including among others, reexamining Medicaid demonstration projects and waiver programs that include work requirements, and policies that create unnecessary barriers to obtaining access to health insurance coverage through Medicaid or the ACA.

In addition, on August 16, 2022, President Biden signed the Inflation Reduction Act of 2022, or the IRA, into law, which among other things, extends enhanced subsidies for individuals purchasing health insurance coverage in ACA marketplaces through plan year 2025.

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Other legislative changes have been proposed and adopted since the ACA was enacted, including aggregate reductions of Medicare payments to providers of 2% per fiscal year and reduced payments to several types of Medicare providers.

These reductions went into effect in April 2013 and, due to subsequent legislative amendments to the statute, including the

Infrastructure Investment and Jobs Act, will remain in effect through 2031, unless additional action is taken by Congress.

These reductions went into effect in April 2013 and, due to subsequent legislative amendments to the statute, including the Infrastructure Investment and Jobs Act, will remain in effect through 2031, unless additional action is taken by Congress.

Under current legislation the actual reduction in Medicare payments will vary from 1% in 2022 to up to 4% in the final fiscal year of this sequester.

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Of these full-time employees, 108 employees are engaged in research and development and 28 employees are engaged in management or general and administrative activities.

All of our employees are based in the United States.

None of our employees are subject to a collective bargaining agreement or represented by a trade or labor union.

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All employees are eligible for health insurance, paid and unpaid leaves including paid parental leave, retirement plans with an employer contribution match, life and disability/accident coverage and access to convenient COVID-19 testing.

Additionally, to further assist our employees, we also offer all full-time employees the option to participate in our education assistance program, where we reimburse employees for a portion of tuition fees and eligible expenses.

Additionally, to continually develop and facilitate the growth of our employees, we also offer all full-time employees the option to participate in our education assistance program, where we reimburse employees for a portion of tuition fees and eligible expenses.

Conduct and Ethics

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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