What changed in this filing

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Item 1A. Risk Factors

2021-05-06 compared with 2020-10-30 · 22 added, 29 removed, 33 unchanged (61% of the section changed)

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Risks Related to Our Business and Industry

• We face business disruption and related risks resulting from the outbreak of the novel coronavirus, or COVID-19, including delays in the enrollment of ongoing clinical trials and the initiation of planned clinical trials and other operational impacts, each of which could have a material adverse effect on our business.

• We depend on our ability to obtain regulatory approval in the United States for sotagliflozin in type 1 diabetes.

If we fail to obtain such regulatory approval or fail to successfully commercialize sotagliflozin for type 1 diabetes in the United States upon regulatory approval, our business will suffer and our stock price will likely decline.

• We depend on our ability to effectively close out two outcomes studies evaluating the effect of sotagliflozin on cardiovascular death and heart failure and involving approximately 10,500 and 1,200 patients, respectively.

If we fail to effectively close out such clinical trials on the anticipated timelines, our cash position will suffer and our stock price will likely decline.

• We depend on TerSera’s ability to successfully develop and commercialize XERMELO for biliary tract cancer and our receipt of milestone payments and royalties from such efforts.

If TerSera does not successfully complete such development and commercialization activities, we will not receive milestone payment and royalties relating to such efforts, our cash position will suffer and our stock price will likely decline.

• Clinical testing of our drug candidates in humans is an inherently risky and time-consuming process that may fail to demonstrate safety and efficacy, which could result in the delay, limitation or prevention of regulatory approval.

• Our drug candidates are subject to a lengthy and uncertain regulatory process that may not result in the necessary regulatory approvals, which could adversely affect our and our collaborators’ ability to commercialize products.

• We depend on our ability to gain alignment with certain regulatory authorities on our regulatory strategy for sotagliflozin in heart failure.

If we fail to effectively gain such alignment, our business will suffer and our stock price will likely decline.

• The commercial success of any products that we or our collaborators may develop will depend upon the degree of market acceptance among physicians, patients, health care payers and the medical community.

• If we are unable to establish an effective and specialized sales force, marketing infrastructure and distribution capabilities, we will not be able to successfully commercialize any products that we or our collaborators may develop.

• If we are unable to obtain adequate coverage and reimbursement from third-party payers for any products that we or our collaborators may develop, our revenues and prospects for profitability will suffer.

• If we are unable to reestablish an effective sales force, marketing infrastructure and distribution capabilities, we will not be able to successfully commercialize any products that we or our collaborators may develop.

• If we are unable to maintain adequate coverage and reimbursement from third-party payers for any products that we or our collaborators may develop, our revenues and prospects for profitability will suffer.

• We may not be able to manufacture products that we or our collaborators may develop in commercial quantities, which would impair our ability to commercialize such products.

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• Current healthcare laws and regulations and future legislative or regulatory reforms to the healthcare system may negatively affect our revenues and prospects for profitability.

• Pricing for pharmaceutical products has come under increasing scrutiny by governments, legislative bodies and enforcement agencies.

These activities may result in actions that have the effect of reducing our revenue or harming our business or reputation.

• Our competitors may develop products that impair the value of any products that we or our collaborators may develop.

• We face business disruption and related risks resulting from the outbreak of the novel coronavirus, or COVID-19, including delays in the enrollment of ongoing clinical trials and other operational impacts, each of which could have a material adverse effect on our business.

Risks Related to Our Capital Requirements and Financial Results

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• We have a history of net losses, and we expect to continue to incur net losses and may not achieve or maintain profitability.

• Our operating results have been and likely will continue to fluctuate, and we believe that period-to-period comparisons of our operating results are not a good indication of our future performance.

• Our operating results have fluctuated and likely will continue to fluctuate, and we believe that period-to-period comparisons of our operating results are not a good indication of our future performance.

• We have indebtedness that may limit cash flow available to invest in the ongoing needs of our business.

Risks Related to Our Relationships with Third Parties

• We are significantly dependent upon our ability to establish collaborations with pharmaceutical and biotechnology companies for the development and commercialization of pharmaceutical products.

If we are unable to establish such collaborations or if pharmaceutical products are not successfully and timely developed and commercialized under such collaborations, our opportunities to generate revenues from pharmaceutical products we develop will be greatly reduced.

• We depend on our ability to establish a strategic collaboration for the commercialization of sotagliflozin in heart failure.

If we are unable to establish such a collaboration, sotagliflozin may not be commercialized in heart failure, our business will suffer and our stock price will likely decline.

• We depend on our ability to establish collaborations with pharmaceutical and biotechnology companies for the development and commercialization of our other drug candidates.

If we are unable to establish such collaborations, or if pharmaceutical products are not successfully and timely developed and commercialized under such collaborations, our opportunities to generate revenues from our other drug candidates will be greatly reduced.

• Conflicts with our collaborators could jeopardize the success of our collaborative agreements and harm our product development efforts.

• We rely on third parties to carry out our nonclinical studies and clinical trials, which may harm or delay our research and development efforts.

• We lack the capability to manufacture materials for nonclinical studies and clinical trials and rely on third parties to manufacture our drug candidates, which may harm or delay our research and development efforts.

• We lack the capability to manufacture materials for nonclinical studies, clinical trials and rely on third parties to manufacture our drug candidates, which may harm or delay our research and development efforts.

Risks Related to Our Intellectual Property

• If we are unable to adequately protect our intellectual property, third parties may be able to use our products and technologies, which could adversely affect our ability to compete in the market.

• We may be involved in patent litigation and other disputes regarding intellectual property rights and may require licenses from third parties for our planned nonclinical and clinical development activities.

We may not prevail in any such litigation or other dispute or be able to obtain required licenses.

• Data breaches and cyber-attacks could compromise our intellectual property or other sensitive information and cause significant damage to our business and reputation.

• Data breaches and cyber-attacks could compromise our intellectual property or other sensitive information and cause significant damage to our business, reputational harm and financial loss.

• We may be subject to damages resulting from claims that we, our employees or independent contractors have wrongfully used or disclosed alleged trade secrets of their former employers.

Risks Related to Employees and Facilities Operations

• If we are unable to manage any future growth, our business, financial condition, results of operations and prospects may be adversely affected.

Risks Related to Our Employees and Facilities

• If we are unable to manage our growth, our business, financial condition, results of operations and prospects may be adversely affected.

• The loss of key personnel or the inability to attract and retain additional personnel could impair our ability to operate and expand our operations.

• Facility security breaches may disrupt our operations, subject us to liability and harm our operating results.

• Our facilities are located near coastal zones, and the occurrence of a hurricane or other disaster could damage our facilities and equipment, which could harm our operations.

Risks Related to Environmental and Product Liability

• We have used hazardous chemicals and radioactive and biological materials in our business.

Any claims relating to improper handling, storage or disposal of these materials could be time consuming and costly.

• We have used hazardous chemicals and radioactive and biological substances in our business.

Any claims relating to improper handling, storage or disposal of these substances could be time consuming and costly.

• Our business has a substantial risk of product liability and we face potential product liability exposure far in excess of our limited insurance coverage.

Risks Related to Our Common Stock

• Invus, L.P., Invus C.V.

and their affiliates own a controlling interest in our outstanding common stock and may have interests which conflict with those of our other stockholders.

• Invus has additional rights under our stockholders’ agreement with Invus, L.P.

relating to the membership of our board of directors, which provides Invus with substantial influence over significant corporate matters.

• Invus, L.P.

and its affiliates own a controlling interest in our outstanding common stock and may have interests which conflict with those of our other stockholders.

• Invus has additional rights under its stockholders’ agreement relating to the membership of our board of directors, which provides Invus with substantial influence over significant corporate matters.

• Our stock price may be extremely volatile.

• We are subject to securities litigation, which is expensive and could divert management attention.

• Future sales of our common stock, or the perception that such sales may occur, may depress our stock price.

• Conversion of the Convertible Senior Notes may dilute the ownership interest of our existing stockholders, including holders who had previously converted their notes, or may otherwise depress the price of our common stock.

• Future issuances or sales of our common stock, or the perception that such issuances or sales may occur, may depress our stock price.

• If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.

• We may engage in future acquisitions, which may be expensive and time consuming and from which we may not realize anticipated benefits.

For additional discussion of the risks and uncertainties that affect our business, see “Item 1A.

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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-Q

Item 1A. Risk Factors