1 unchanged sentence
Evaluation of Disclosure Controls and Procedures
−Removed: Under the supervision of our Chief Executive Officer and Chief Accounting Officer, we evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) of the Exchange Act as of December 31, 2021.
+Added: Under the supervision of our Chief Executive Officer and Chief Accounting Officer, we evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of December 31, 2022.
Based on that evaluation, our Chief Executive Officer and Chief Accounting Officer have concluded that our disclosure controls and procedures were effective as of December 31, 2022 to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Accounting Officer, as appropriate to allow timely discussion regarding required disclosures.
5 unchanged sentences
Based on the results of its evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2022.
−Removed: The effectiveness of our internal control over financial reporting as of December 31, 2021 has been audited by Mayer Hoffman McCann P.C., an independent registered public accounting firm, as stated in their report which is included herein.
+Added: The effectiveness of our internal control over financial reporting as of December 31, 2022 has been audited by KPMG, an independent registered public accounting firm, as stated in their report which is included herein.
Inherent Limitations on Controls and Procedures
14 unchanged sentences
Changes in Internal Control over Financial Reporting
−Removed: We are in the process of implementing new enterprise resource planning software, Microsoft Dynamics D365 (“Dynamics”), as part of a plan to integrate and upgrade our systems and processes.
−Removed: The implementation of this software is scheduled to continue in phases over a number of years.
−Removed: During the second and third quarter of 2021, we completed the implementation of the financial reporting and consolidation modules and the procurement modules, respectively.
+Added: In 2021, we implemented the first phase of our enterprise resource planning software, Microsoft Dynamics D365 (“Dynamics”), as part of a plan to integrate and upgrade our systems and processes.
+Added: The implementation of this software is scheduled to continue in phases over a number of years as the Company grows and as we move towards commercialization of our initial product candidate, B-VEC.
As the phased implementation of this system occurs, we expect certain changes to our processes and procedures which, in turn, will result in changes to our internal control over financial reporting.
−Removed: We expect Dynamics to strengthen our internal financial controls by automating a number of accounting and reporting processes and activities, thereby decreasing the number of manual processes previously required.
+Added: We expect Dynamics to continue to strengthen our internal financial controls.
Management will continue to evaluate and monitor our internal controls as processes and procedures in each of the affected areas evolve.
+Added: As we are still in the process of implementing these additional phases, no change in our internal control over financial reporting occurred during the year ended December 31, 2022.
Other than as discussed above, there was no change in our internal control over financial reporting identified in connection with the evaluation required by Rules 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the year ended December 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Report of Independent Registered Public Accounting Firm
−Removed: To the Board of Directors and
−Removed: Stockholders of Krystal Biotech, Inc.:
+Added: To the Stockholders and Board of Directors
+Added: Krystal Biotech, Inc.:
Opinion on Internal Control Over Financial Reporting
−Removed: We have audited Krystal Biotech Inc.’s (“Company”) internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO criteria).
−Removed: In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria.
−Removed: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheet and related statement of operations and comprehensive loss, stockholders’ equity, cash flows and the related notes of the Company and our report dated February 28, 2022 expressed an unqualified opinion.
+Added: We have audited Krystal Biotech, Inc.
+Added: and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
+Added: In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
+Added: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2022 the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for the year ended December 31, 2022, and the related notes (collectively, the consolidated financial statements), and our report dated February 27, 2023 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
9 unchanged sentences
Definition and Limitations of Internal Control Over Financial Reporting
−Removed: A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.
+Added: A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
−Removed: (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and
−Removed: directors of the company;
+Added: (2) provide reasonable assurance that transactions are recorded as necessary to permit
+Added: preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;
and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
1 unchanged sentence
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
−Removed: /s/ Mayer Hoffman McCann P.C.
−Removed: San Diego, California
+Added: Pittsburgh, Pennsylvania
February 27, 2023
3 unchanged sentences
Directors, Executive Officers and Corporate Governance.
−Removed: Information required by this Item is hereby incorporated by reference to our Definitive Proxy Statement.
+Added: Information required by this Item is hereby incorporated by reference to our 2023 Definitive Proxy Statement, which will be filed prior to April 30, 2023..
Executive Compensation.
−Removed: Information required by this Item is hereby incorporated by reference to our Definitive Proxy Statement.
+Added: Information required by this Item is hereby incorporated by reference to our 2023 Definitive Proxy Statement, which will be filed prior to April 30, 2023..
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
−Removed: Information required by this Item is hereby incorporated by reference to our Definitive Proxy Statement.
+Added: Information required by this Item is hereby incorporated by reference to our 2023 Definitive Proxy Statement, which will be filed prior to April 30, 2023..
Certain Relationships and Related Transactions, and Director Independence.
−Removed: Information required by this Item is hereby incorporated by reference to our Definitive Proxy Statement.
+Added: Information required by this Item is hereby incorporated by reference to our 2023 Definitive Proxy Statement, which will be filed prior to April 30, 2023..
Principal Accounting Fees and Services.
−Removed: Information required by this Item is hereby incorporated by reference to our Definitive Proxy Statement.
+Added: Information required by this Item is hereby incorporated by reference to our 2023 Definitive Proxy Statement, which will be filed prior to April 30, 2023..
Exhibits, Financial Statement Schedules.
17 unchanged sentences
333-227632), as filed with the SEC on October 1, 2018)
−Removed: 4.3* Description of Common Stock (incorporated by reference to Exhibit 4.3 to the Company's Annual Report on Form 10-K, as filed with the SEC on March 1, 2021)
+Added: 4.3* Description of Common Stock
10.1# Indemnification Agreement by and between Krystal Biotech, Inc.
12 unchanged sentences
and Kathryn A.
−Removed: Romano (incorporated by refere nce to Exhibit 10.4 to the Company's Annual Rep ort on Form 10-K, as filed with the SEC on March 1, 2021)
+Added: Romano (incorporated by reference to Exhibit 10.4 to the Company's Annual Report on Form 10-K, as filed with the SEC on March 1, 2021)
10.5# Executive Employment Agreement, effective May 3, 202 1 by and between Krystal Biotech, Inc.
and Andy Orth
−Removed: 10.6# Executive Employment Agreement, effective January 18, 2022, by and between Krystal Biotech, Inc.
−Removed: and Jing Marantz
10.6# Krystal Biotech, Inc.
48 unchanged sentences
10.22 Guaranteed Maximum Price Amendment to Standard Form of Contract for Construction and the corresponding General Conditions of the Contract for Construction with The Whiting-Turner Contracting Company dated September 13, 2021 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, as filed with the SEC on September 16, 2021)
+Added: 10.23*# Form of Krystal Biotech, Inc.
+Added: 2017 IPO Stock Incentive Plan Notice of Restricted Stock Award and Restricted Stock Award Agreement
+Added: 16.1 Letter to Securities and Exchange Commission from Mayer Hoffman McCann P.C.
+Added: dated May 26, 2022 (incorporated by reference to Exhibit 16.1 to the Company’s Current Report on Form 8-K, as filed with the SEC on May 26, 2022).
21.1* Subsidiaries of Krystal Biotech, Inc.
+Added: 23.1* Consent of KPMG LLP
23.2* Consent of Mayer Hoffman McCann P.C.
1 unchanged sentence
31.2* Certification of Periodic Report by Chief Accounting Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
−Removed: 32.1* Certification of Chief Executive Officer Pursuant to 18 U.S.C.
−Removed: Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
−Removed: 32.2* Certification of Chief Accounting Officer Pursuant to 18 U.S.C.
+Added: 32.1* Certification of Chief Executive Officer and C h ief Accounting Officer Pursuant to 18 U.S.C.
Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
−Removed: 101.INS XBRL Instance Document
−Removed: 101.SCH XBRL Taxonomy Extension Schema Document
−Removed: 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document
−Removed: 101.DEF XBRL Taxonomy Extension Definition Linkbase Document
−Removed: 101.LAB XBRL Taxonomy Extension Label Linkbase Document
−Removed: 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document
+Added: 101 (i) XBRL Instance Document, (ii) XBRL Taxonomy Extension Schema Document, (iii) XBRL Taxonomy Extension Calculation Linkbase Document, (iv) XBRL Taxonomy Extension Definition Linkbase Document, (v) XBRL Taxonomy Extension Label Linkbase Document, (vi) XBRL Taxonomy Extension Presentation Linkbase Document.
+Added: 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).
* Filed herewith.
15 unchanged sentences
Romano Chief Accounting Officer (Principal Financial Officer) February 27, 2023
−Removed: Krishnan Chief Operating Officer and Director February 28, 2022
+Added: Krishnan President, R&D and Director February 27, 2023
/s/ Daniel S.
9 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.