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Item 1. Business

2021-02-25 compared with 2020-02-26 · 115 added, 152 removed, 480 unchanged (36% of the section changed)

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Executive Overview

We are a clinical-stage biopharmaceutical company pursuing novel therapeutics that target a specific thyroid hormone receptor pathway in the liver, which is a key regulatory mechanism common to a spectrum of cardio-metabolic and fatty liver diseases with high unmet medical need.

We are a clinical-stage biopharmaceutical company focused on the development and commercialization of innovative therapeutic candidates for the treatment of cardiovascular, metabolic, and liver diseases.

Our lead product candidate, MGL-3196

(resmetirom), is a proprietary, first-in-class,

orally administered, small molecule, liver-directed, thyroid hormone receptor-ß (THR-

ß) selective agonist being developed as a once-daily oral pill that can potentially be used to treat a number of disease states including non-alcoholic

(resmetirom), is a proprietary, liver-directed, selective thyroid hormone receptor-ß, or THR-ß,

agonist being developed as a once-daily oral pill that can potentially be used to treat a number of disease states with high unmet medical need, including non-alcoholic

steatohepatitis, or NASH.

Phase 2 clinical trial has been completed and the 12-week

primary and secondary endpoints were achieved in the main study, results were reported in December 2017, and positive topline 36-week

results were reported at the conclusion of the Phase 2 clinical trial in May 2018.

There was an extension study in a subset of the patients that completed the main 36-week

study, which was completed in 2019.

On March 28, 2019 the Company announced that it had initiated the MAESTRO-NASH Phase 3 trial with its once daily, oral thyroid hormone receptor beta selective agonist, resmetirom.

This double-blind, placebo-controlled study is currently being conducted at more than 150 sites in the United States and the rest of the world.

Patients with liver biopsy confirmed NASH with stage 2 or 3 fibrosis are be randomized 1:1:1 to receive a single oral daily dose of placebo, resmetirom 80 mg or resmetirom 100 mg.

Our Patient Market Opportunity.

NASH is a serious inflammatory form of nonalcoholic fatty liver disease, or NAFLD.

NAFLD has become the most common liver disease in the United States and other developed countries and is characterized by an accumulation of fat in the liver with no other apparent causes.

NASH can progress to cirrhosis or liver failure, require liver transplantation and can also result in liver cancer.

Progression of NASH to end stage liver disease will soon surpass all other causes of liver failure requiring liver transplantation.

Importantly, beyond these critical conditions, NASH and NAFLD patients additionally suffer heightened cardiovascular risk and, in fact, die more frequently from cardiovascular events than from liver disease.

NASH and NAFLD have grown as a consequence of rising worldwide obesity-related disorders.

In 2016, in the United States alone, NAFLD was estimated to affect approximately 26% of the population, or an estimated 85M people, and approximately 20% of this population was projected to progress from NAFLD to NASH.

Current estimates place NASH prevalence at approximately 17M people in the United States, or five percent of the population.

Slightly lower prevalence is seen in EU and Asia with approximately 2.5-4.5%

of the population having NASH.

Our Completed Studies.

For NASH, we enrolled 125 patients in a Phase 2 clinical trial with resmetirom.

We achieved the 12-week

primary endpoint for this Phase 2 clinical trial and reported the results in December 2017, and we reported positive topline 36-week

results at the conclusion of the Phase 2 clinical trial in May 2018.

We have completed treatment in a 36-week,

open-label extension study in 31 participating NASH patients from our Phase 2 clinical trial, which includes 14 patients who received placebo in the main study.

We also completed a 116 patient Phase 2 clinical trial and announced results in February 2018 for the use of resmetirom in patients with heterozygous familial hypercholesterolemia, or HeFH.

In addition to the NASH and HeFH Phase 2 clinical trials, resmetirom has also been studied in eight completed Phase 1 trials in a total of 219 subjects.

Resmetirom appeared to be safe and was well-tolerated in these trials, which included a single ascending dose trial, a multiple ascending dose trial, two drug interaction trials with statins, a multiple dose mass balance study, a single dose relative bioavailability study of tablet formulation versus capsule formulation, a multiple dose drug interaction study, and a multiple dose drug interaction with food effect study.

Our Ongoing and Planned Studies.

On March 28, 2019, the Company announced that it had initiated MAESTRO-NASH, a Phase 3 trial in NASH with its once daily, oral thyroid hormone receptor beta selective agonist, resmetirom.

This double-blind, placebo-controlled study is being conducted at more than 200 sites in the United States and the rest of the world.

Patients with liver biopsy confirmed NASH with stage 2 or 3 fibrosis are being randomized 1:1:1 to receive a single oral daily dose of placebo, resmetirom 80 mg or resmetirom 100 mg.

A second liver biopsy at week 52 in the first 900 patients will be the basis of filing for subpart H-accelerated

the primary endpoint will be the percent of patients treated with either dose of resmetirom as compared with placebo who achieve NASH resolution on the week 52 liver biopsy, defined as the absence of hepatocyte ballooning (score=0), and minimal lobular inflammation (score 0-1),

associated with at least a 2 point reduction in NAS, and no worsening of fibrosis stage.

associated with at least a 2-point

reduction in NAS (NAFLD Activity Score), and no worsening of fibrosis stage.

Two key secondary endpoints are reduction in LDL-cholesterol

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or more improvement in fibrosis stage on the week 52 biopsy with no worsening of NASH.

Patients will continue in the study for a total of approximately 54 months and will be evaluated for a composite clinical outcome including cirrhosis on liver biopsy, or a liver related event such a hepatic decompensation.

Patients will continue in the study for a total of approximately 54 months, and will be evaluated for a composite clinical outcome including cirrhosis on liver biopsy, or a liver related event such as hepatic decompensation.

The total anticipated enrollment is approximately 2,000 patients, and will include up to 15% high risk F1 fibrosis stage NASH patients whose efficacy responses will be evaluated as exploratory endpoints.

On December 18, 2019 the Company announced it had opened for enrollment MAESTRO-NAFLD-1,

double-blind, placebo controlled Phase 3 clinical study in 700 patients with biopsy-confirmed or presumed NASH recruited from sites in the U.S.

double-blind, placebo controlled Phase 3 clinical study originally targeting enrollment of 700 patients with biopsy-confirmed or presumed NASH recruited from sites in the U.S.

Key endpoints are safety, including safety biomarkers, LDL cholesterol, lipid biomarkers, and fibrosis biomarkers.

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and NASH biomarker endpoints.

In addition, MAESTRO-NAFLD-1

includes an open label arm in which up to 100 patients will be dosed with 100 mg resmetirom.

Enrollment objectives for this study have been exceeded, with approximately 1,200 patients enrolled overall.

In October 2020 we completed enrollment of the double-blind, placebo controlled arms of the study.

The MAESTRO-NAFLD-1

study will help support the adequacy of the safety database at the time of NDA submission for subpart H approval for treatment of NASH in patients with F2 or F3 fibrosis (MAESTRO-NASH, NASH resolution surrogate endpoint).

The Company has also completed a Phase 2 clinical trial in 116 patients with heterozygous familial hypercholesterolemia (HeFH), and we reported the results in February 2018.

In addition to the NASH and HeFH Phase 2 clinical trials, resmetirom has also been studied in eight completed Phase 1 trials in a total of 219 healthy volunteers.

balance study, a single dose relative bioavailability study of tablet formulations versus capsule formulation, and a multiple dose drug interaction and food effect study.

Further, we have initiated a Phase 1 trial to study patients with varying degrees of hepatic impairment (including patients with mild, moderate and severe hepatic impairment) and NASH patients.

The following chart summarizes the status of our product candidate development programs for resmetirom and MGL-3745,

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Key Developments

Initiation of MAESTRO-NASH Phase 3 clinical trial

On March 28, 2019 the Company announced that it had initiated a Phase 3 trial in NASH with its once daily, oral thyroid hormone receptor beta selective agonist, MGL-3196

(resmetirom).

This double-blind, placebo-controlled study will be conducted at more than 150 sites in the United States and the rest of the world.

Patients with liver biopsy confirmed NASH with stage 2 or 3 fibrosis will be randomized 1:1:1 to receive a single oral daily dose of placebo, resmetirom 80 mg or resmetirom 100 mg.

A second liver biopsy at week 52 in the first 900 patients will be the basis of filing for subpart H-accelerated

associated with at least a 2 point reduction in NAS, and no worsening of fibrosis stage.

Two key secondary endpoints are reduction in LDL-cholesterol

and a 1-point

or more improvement in fibrosis stage on the week 52 biopsy with no worsening of NASH.

The total anticipated enrollment is approximately 2,000 patients and will include up to 15% high risk F1 fibrosis stage NASH patients whose efficacy responses will be evaluated as exploratory endpoints.

Initiation of MAESTRO-NAFLD-1

Ongoing MAESTRO-NASH Phase 3 clinical trial

In March 2019 we initiated a Phase 3 trial in NASH, described in detail above under “—Our Ongoing and Planned Studies.”

Ongoing MAESTRO-NAFLD-1

Phase 3 clinical trial

On December 10, 2019 the Company announced it had opened for enrollment MAESTRO-NAFLD-1,

double-blind, placebo controlled Phase 3 clinical study in 700 patients with biopsy-confirmed or

presumed NASH recruited from sites in the U.S.

Key endpoints are safety, including safety biomarkers, LDL cholesterol, lipid biomarkers, and fibrosis biomarkers.

Except for serial liver biopsies, the study protocol is similar to the MAESTRO-NASH study with resmetirom doses of 80 mg or 100 mg or placebo and includes key secondary lipid, MRI-PDFF

and NASH biomarker endpoints.

In addition, MAESTRO-NAFLD-1

includes an open label arm in which up to 100 patients will be dosed with 100 mg resmetirom.

The MAESTRO -NAFLD-1

In December 2019 we initiated a Phase 3 trial in presumed NASH, described in detail above under “—Our Ongoing and Planned Studies.” In October 2020 we completed enrollment of the double-blind, placebo controlled arms of the study.

FDA grants Fast Track designation for resmetirom in NASH

In October 2019, FDA granted Fast Track designation to resmetirom for NASH.

Pandemic Effects on Madrigal

In April 2020 we announced that in response to guidance from regulatory agencies, measures for COVID-19

at impacted sites have been put in place for our Phase 3 MAESTRO-NASH and MAESTRO-NAFLD-1

studies, allowing both studies to continue without changes to the protocol.

At a recently conducted Data Monitoring Committee (DMC) meeting it was recommended that Phase 3 studies proceed without significant modification.

pandemic had no material adverse impact on our operating results, MAESTRO-NAFLD-1

study or liquidity for the period ended December 31, 2020, but it did introduce clinical trial and operational risks and uncertainties that are both general in nature and relate specifically to our MAESTRO-NASH study.

These risks and uncertainties, which are beyond our control, are summarized in the section entitled “Risk Factors” in Part I, Item 1A of this Annual Report.

(resmetirom) Phase 2 Clinical Trial in NASH

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We believe that resmetirom may be the first THR-agonist

product candidate in development for NASH that selectively targets the THR-ß pathway.

product candidate in development for NASH that selectively targets the THR-ß

Active thyroid hormone, known as T3, interacts with two nuclear receptors, THR-α,

, which is the predominant receptor expressed in most human tissues, including heart and bone, and THR-ß, which has more restricted tissue expression, and is the predominant receptor responsible for metabolic actions in the liver, including both cholesterol- and TG-lowering.

Selective activation of the THR-ß receptor in liver tissue is believed to favorably affect cholesterol and lipoprotein levels via multiple mechanisms, which may be complementary to those of other lipid-lowering therapies such as statin drugs.

We believe that these characteristics of THR-ß activation by resmetirom will in turn lead to clinically meaningful reductions in LDL-C,

which is the predominant receptor expressed in most human tissues, including heart and bone, and THR-ß,

which has more restricted tissue expression, and is the predominant receptor responsible for metabolic actions in the liver, including both cholesterol- and TG-lowering.

Selective activation of the THR-ß

receptor in liver tissue is believed to favorably affect cholesterol and lipoprotein levels via multiple mechanisms, which may be complementary to those of other lipid-lowering therapies such as statin drugs.

We believe that these characteristics of THR-ß

activation by resmetirom will in turn lead to clinically meaningful reductions in LDL-C,

and plasma and liver TGs.

We believe that resmetirom is the first selective small molecule THR-ß agonist compound.

We believe that resmetirom is the first selective small molecule THR-ß

agonist compound.

Resmetirom, along with MGL-3745,

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Roche, or Roche, in Nutley, New Jersey, by utilizing a novel functional assay that, unlike a simple receptor binding assay, assessed the functional activity of compounds which interacted with thyroid hormone receptors.

In a published study by Madrigal and Roche in the Journal of Medicinal Chemistry using this functional assay, resmetirom was shown to be highly selective for the THR-ß receptor, with almost no effect on THR- α

In a published study by Madrigal and Roche in the Journal of Medicinal Chemistry using this functional assay, resmetirom was shown to be highly selective for the THR-ß

receptor, with almost no effect on THR-α,

unlike other compounds purported in published studies to be ß -selective based on binding affinity, but which were shown to equally activate THR-α

and THR-ß in the novel functional assay.

in the novel functional assay.

We believe that the ß-selectivity and liver-targeting properties of resmetirom are critically important for resmetirom’s beneficial metabolic actions in the liver, and enable avoidance of safety issues associated with THR-α

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The results of these studies suggest that resmetirom is suitable for once-daily oral dosing.

Currently there is an ongoing Phase 1 hepatic impairment study to characterize the safety and pharmacokinetics of resmetirom in patients with hepatic impairment.

Currently there is an ongoing Phase 1 hepatic impairment study to characterize the safety and pharmacokinetics of resmetirom in patients with hepatic impairment, a Phase 1 drug-interaction study with warfarin, and a drug interaction study of resmetirom and pravastatin and simvastatin.

In a Phase 1 multiple ascending dose study in healthy subjects, the effects of resmetirom on lipid parameters were assessed as initial markers of pharmacodynamic activity (Atherosclerosis 230:373-380,

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(range, p=.05-<0.0001),

28% for non-high-

density lipoprotein cholesterol, or non-HDL-C

28% for non-high-density

lipoprotein cholesterol, or non-HDL-C

(range, p =0.027-p<0.0001)

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The near maximal lipid effects were observed at a resmetirom dose of 80 mg once-daily.

Resmetirom was well-tolerated at all doses, with no dose-related adverse events or liver enzyme, electrocardiography, or vital-sign changes.

Resmetirom was well-tolerated at all doses, with no dose-related

adverse events or liver enzyme, electrocardiography, or vital-sign changes.

At the highest dose of resmetirom (200 mg), there was a reversible reduction of 20% in the level of a precursor hormone to T3, free T4, which was significantly different from placebo (p < 0.0001) that may be explained by increased liver metabolism of free T4.

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TG, triglycerides (median %CFB).

In a Phase 2 double-blind, placebo-controlled, multi-center clinical trial, 116 patients with HeFH

who were not at their LDL-C

In a Phase 2 double-blind, placebo-controlled, multi-center clinical trial, 116 patients with HeFH who were not at their LDL-C

goal were randomized in a 2:1 ratio to receive either resmetirom or placebo, in addition to their current cholesterol lowering regimen, which included approximately 75% taking high intensity statins (20/40 mg rosuvastatin or 80 mg atorvastatin), and about two-thirds

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Resmetirom demonstrated statistical significance (p<0.0001) in the primary endpoint, the relative reduction of liver fat on MRI-PDFF

At 36 weeks, statistically significant results were demonstrated in

multiple histology endpoints including key secondary endpoints related to the reduction and resolution of NASH (see Table on page 3).

At 36 weeks, statistically significant results were demonstrated in multiple histology endpoints including key secondary endpoints related to the reduction and resolution of NASH.

At 36 weeks, resmetirom treated patients demonstrated sustained, statistically significant (p<0.0001) reductions compared to placebo treated patients in LDL-C

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In addition, resmetirom demonstrated statistically significant reductions in liver enzymes (ALT, AST and GGT) relative to placebo (all p=0.002).

Published data [Lancet] showed that patients with >=30% PDFF reduction at Week 12 had a higher rate of NASH resolution and accompanying fibrosis reduction.

A secondary analysis of the Phase 2 NASH clinical trial further supported the potential of PDFF to predict NASH response.

Percentages of patients with NASH resolution at Week 36 increased with greater PDFF reduction (agreement between two independent pathologist central biopsy readers)

In resmetirom-treated patients with ³

50% fat reduction at Week 12, 64% had NASH resolution with a component response driven primarily by ballooning and inflammation

PDFF reduction ³

50% at Week 12 was associated with improvement in all NAS components including fibrosis reduction on subsequent liver biopsy and achievement of both endpoints:

NASH resolution and ³

1 point fibrosis reduction PDFF reduction ³

50% at Week 12 was also associated with fibrosis reduction on subsequent liver biopsy

These findings support the pathogenicity of liver steatosis in NASH and fibrosis progression.

Our goal is to become a leading biopharmaceutical company developing and commercializing innovative liver-directed, ß-selective thyroid hormone receptor agonists for the treatment of cardio-metabolic and liver disease, fibrosis and inflammation.

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To achieve our goal, we plan to:

Complete clinical development and seek regulatory approval of MGL-3196 (resmetirom) in NASH.

Complete clinical development and seek regulatory approval of MGL-3196

(resmetirom) in NASH.

We successfully completed a Phase 2 clinical trial in NASH in 2018.

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pleiotrophic actions in liver cells and potential to reduce cardiovascular risk in NASH patients.

Establish commercial capabilities to market MGL-3196 (resmetirom) as a leading treatment for NASH.

Establish commercial capabilities to market MGL-3196

(resmetirom) as a leading treatment for NASH.

If approved, we may choose either to establish a sales and marketing organization with technical expertise and supporting distribution capabilities to commercialize resmetirom, or to collaborate with one or more third parties to accomplish these tasks.

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We believe this will enable us to launch resmetirom in NASH in a cost-effective, targeted manner.

Grow our pipeline through additional indications for MGL-3196 (resmetirom) potentially including orphan indications.

Grow our pipeline through additional indications for MGL-3196

(resmetirom) potentially including orphan indications.

We believe that resmetirom has the potential to be an effective treatment for other disease indications that are rare diseases or may be designated rare diseases and we may pursue orphan drug designation where possible.

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(resmetirom) in NASH

We are developing resmetirom for NASH.

Based on the scientific literature in human and animal studies, we believe that NASH livers in humans frequently have a deficiency in THR-ß activity that leads to features of NASH, including fatty liver, inflammation and fibrosis, and that treatment with resmetirom will replace this hormone deficiency and be an effective NASH treatment.

We are developing resmetirom for the treatment of non-cirrhotic

NASH with fibrosis.

Based on the scientific literature in human and animal studies, we believe that NASH livers in humans frequently have a deficiency in THR-ß

activity that leads to features of NASH, including fatty liver, inflammation and fibrosis, and that treatment with resmetirom will replace this hormone deficiency and be an effective NASH treatment.

We believe that resmetirom is an excellent candidate for the chronic treatment of NASH because of its safety and tolerability profile observed to date in healthy subjects, its effects in reducing cardiovascular risk factors such as LDL-C

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or more improvement in fibrosis stage on the week 52 biopsy with no worsening of NASH.

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includes an open label arm in which up to 100 patients will be dosed with 100 mg resmetirom.

Enrollment objectives for this study have been exceeded, with approximately 1,200 patients enrolled overall.

In October 2020 we completed enrollment of the double-blind, placebo controlled arms of the study.

The MAESTRO-NAFLD-1

study will help support the adequacy of the safety database at the time of NDA submission for subpart H approval or treatment of NASH in patients with F2 or F3 fibrosis (MAESTRO-NASH, NASH resolution surrogate endpoint).

Madrigal has agreement on liver biopsy endpoints with the FDA, and long term liver related benefit endpoints for the treatment of NASH.

Given that NASH is an evolving field, and FDA evaluates risk versus

benefit prior to approval, Phase 3 data will be carefully reviewed by FDA.

Given that NASH is an evolving field, and FDA evaluates risk versus benefit prior to approval, Phase 3 data will be carefully reviewed by FDA.

However, currently there are ongoing Phase 3 clinical trials of compounds to treat NASH by other companies in which it is contemplated that accelerated approval of the compounds under FDA subpart H, which provides for accelerated approval of certain new drug products that have been studied for their safety and effectiveness in treating serious or life-threatening illnesses and that provide meaningful therapeutic benefit to patients over existing treatments, would be based on the surrogate endpoint of histological evidence of NASH resolution without the worsening of fibrosis.

It is expected that these trials would continue after approval to confirm the long term clinical benefit of NASH resolution based on a reduction in patients progressing to cirrhosis and other liver related events.

Dyslipidemia in NASH patients

Overview and Market Opportunity

Patients with NASH, and its more prevalent precursor, NAFLD, are at heightened cardiovascular risk.

Patients suffering from these conditions die more frequently from cardiovascular events than from their liver disease.

Multiple factors contribute to this risk, including elevated levels of LDL-C

and other atherogenic lipoproteins.

Excess liver fat itself is also a significant cardiovascular risk factor.

Patients with NASH and NAFLD, however, may not undergo a biopsy to confirm a NASH diagnosis until they reach the more advanced stages of fibrosis (F2 - F4).

A significant segment of this large group of patients also suffer from diabetes and metabolic syndrome, and have lipid levels that are above target despite treatment with established therapies.

These patients may benefit from therapy to lower their lipid levels in addition to excess liver fat, in order to reduce their cardiovascular risk.

We believe our studies to date in patients with NASH and patients with HeFH, have demonstrated the pleiotropic activity of resmetirom and the potential of the drug to reduce an array of atherogenic lipoproteins, including LDL-C,

ApoB, TG, ApoCIII, and Lp(a).

As a result, we intend to also focus our development of resmetirom on patients with NASH who have elevated lipid levels, because it is unlikely that liver biopsy will be required to diagnose NASH, there is a potential for resmetirom to address patients across the entire NASH spectrum including patients with earlier stages of NASH and NASH-fibrosis..

(resmetirom) in Familial Hypercholesterolemia (FH)

FH is a genetic disorder characterized by aggressive and early onset CVD.

In people with FH, genetic mutations make the liver incapable of metabolizing or removing excess LDL-C,

causing very high LDL-C

levels in the blood.

There are two forms of FH:

HoFH, a less common condition where mutation is inherited from both parents, and HeFH, a more common condition where mutation is inherited from just one parent.

The vast majority of the cholesterol circulating in a person’s body is produced by the liver.

Cholesterol is a necessary component in the structure and function of human cells.

Individuals with FH are unable to recycle this natural supply of cholesterol that their bodies are constantly producing.

Therefore, the cholesterol levels of an individual with FH are exceedingly high.

Over time, the elevated blood cholesterol can lead to blockages in the arteries of the heart and/or brain.

The longer a person experiences high LDL-C,

the more likely he or she will be to experience a cardiovascular event ( i.e.

, heart attack or stroke).

In preclinical animal studies resmetirom lowered LDL-C

in a variety of species as a monotherapy and also when dosed in combination with statins.

Resmetirom also showed the potential to lower Lp(a), a severely atherogenic particle that is frequently elevated in patients with FH.

A previous THR agonist, eprotirome, demonstrated clinical proof of concept for the THR target in Phase 3 FH clinical trials by significantly lowering LDL-C

and Lp(a) in patients with HeFH who were on standard treatments such as statins and ezetimibe.

The development of eprotirome ceased during the Phase 3 FH trial due to liver toxicity observed in the trial as well as eprotirome-induced cartilage damage seen in chronic toxicology studies in dogs.

Because of its high level of THR-ß selectivity, its liver-targeting properties, and its absence of findings in chronic animal toxicology studies, we believe that resmetirom will avoid the toxicity issues of previous THR agonist compounds and may be a beneficial treatment for FH patients.

(resmetirom) FH Phase 2 Clinical Plan

In February 2017, we initiated a Phase 2 clinical trial of resmetirom for the treatment of HeFH.

In the study we randomized HeFH patients 2:1, resmetirom or placebo QD in double-blind, placebo-controlled fashion.

Patients continued treatment through 12 weeks.

The study was conducted in Europe.

In this 12 week clinical trial, the primary endpoint was to evaluate the efficacy of resmetirom as measured by the percent reduction in LDL-C

as compared with placebo.

Secondary endpoints included safety and tolerability, and evaluated the efficacy of resmetirom to reduce a variety of lipid parameters, including non-HDL-C,

ApoB, TGs, Lp(a), apoA/B, and lipoprotein particles.

In February 2018, we announced positive results from the 12 week Phase 2 clinical trial of resmetirom for the treatment of HeFH.

Resmetirom treated patients achieved highly significant reductions in LDL-C,

ApoB, TG, ApoCIII, and Lp(a) in all patients and prespecified subgroups.

Collaborations

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attract and retain high-quality research, development and commercial personnel.

There are currently no therapeutic products approved for the treatment of NASH.

There are currently no therapeutic products approved and marketed for the treatment of NASH.

There are several commercially available products that are currently used off-label

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In addition, there are numerous drugs in development for the treatment of NASH.

Intercept Pharmaceuticals, Inc.

submitted a NDA in September 2019 and MAA in December 2019 for obeticholic acid for the treatment of patients with fibrosis due to NASH.

We are aware of several companies that have product candidates in clinical development for the treatment of NASH, including Gilead Sciences, Inc., Galectin Therapeutics, Inc., Allergan plc / Tobira Pharmaceuticals, Inc., Galmed Medical Research Ltd., Genfit Corp., Cirius Therapeutics, Novartis AG, Novo Nordisk A/S, Takeda, Inventiva, Boehringer Ingelheim GmbH, Bristol-Myers Squibb, Pfizer, Inc., Sanofi S.A., NGM Biopharmaceutical, Viking Therapeutics, Akero Therapeutics, and MedImmune LLC, and there are other companies with candidates in earlier stages of development.

We are aware of several companies that have product candidates in clinical development for the treatment of NASH, including Intercept Pharmaceuticals, Inc., Gilead Sciences, Inc., Galectin Therapeutics, Inc., Galmed Medical Research Ltd., Genfit Corp., Cirius Therapeutics, Novartis AG, Novo Nordisk A/S, Takeda, Inventiva, Boehringer Ingelheim GmbH, Bristol-Myers Squibb, Pfizer, Inc., Merck & Co., Lilly, Genentech, Sanofi S.A., NGM Biopharmaceutical, Viking Therapeutics, Akero Therapeutics, Enanta Pharmaceuticals, 89Bio Inc., and MedImmune LLC, and there are other companies with candidates in earlier stages of development.

Given resmetirom’s actions on the underlying biological pathways across the spectrum of early to late stages of NASH, its CV beneficial effects, and its complementary mechanism to other therapies, we believe that resmetirom has the potential to be used alone or in combination with some of these potential NASH products.

There are several marketed products, both generic and proprietary, available for the treatment of HoFH and HeFH.

We believe that resmetirom has the potential to be used in combination with several of these products.

Available marketed products include:

various statins, Merck’s ezetimibe, Aegerion’s lomitapide, Ionis’ mipomersen, Amgen’s evolocumab and Sanofi/Regeneron’s alirocumab.

In addition, there are multiple drugs in development for the treatment of FH, including Gemphire’s gemcabene, Merck’s anacetrapib, Esperion’s ETC-1002,

and drugs at an earlier stage of development.

Given resmetirom’s pleoitropic lipid-lowering actions, its complementary mechanism to statins and other lipid-lowering drugs, and its potential for lowering Lp(a), we believe that resmetirom has the potential to be used in combination with the standard of care to treat patients with HoFH and HeFH.

Sales and Marketing

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Research and development expenses primarily consist of costs associated with our research activities, including the preclinical and clinical development of our product candidates.

Our research and development

expenses were $72.3 million for the year ended December 31, 2019, $25.4 million for the year ended December 31, 2018, and $24.4 million for year ended December 31, 2017.

Our research and development expenses were $184.8 million for the year ended December 31, 2020, $72.3 million for the year ended December 31, 2019, and $25.4 million for year ended December 31, 2018.

The increase in research and development expenses was primarily due to the advancement of clinical programs to Phase 3 studies, further API manufacturing studies and the continuation of preclinical studies.

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We own or co-own:

three United States and 15 foreign issued patents and allowed patent applications;

and one United States and 36 foreign pending patent applications, each of which relates to composition-of-matter

of resmetirom, including certain dosage forms, and its use in the treatment of key disease indications.

four United States and 23 foreign issued patents and allowed patent applications;

and six United States and 43 foreign pending patent applications, each of which relates to composition-of-matter

of resmetirom, including certain dosage forms, methods of making resmetirom, and its use in the treatment of key disease indications.

Our current patent portfolio covers the United States and certain other jurisdictions worldwide.

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The Roche Agreement imposes various diligence, milestone payment, royalty payment, insurance, indemnification, and other obligations on us.

Issued United States patents directed to resmetirom, including certain dosage forms, have statutory expiration dates between 2026 and 2033, excluding any patent term extensions that might be available following the grant of marketing authorizations.

Issued patents outside of the United States directed to resmetirom, including certain dosage forms, have statutory expiration dates between 2026 and 2033.

Issued patents directed to resmetirom, including certain dosage forms, have statutory expiration dates between 2026 and 2033, excluding any patent term extensions or equivalents thereof that might be available following the grant of marketing authorizations.

We have pending patent applications for resmetirom that, if issued, would be expected to expire in the United States and in countries outside of the United States between 2033 and 2042, excluding any patent term adjustment that might be available following the grant of the patent and any patent term extensions that might be available following the grant of marketing authorizations.

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An IND sponsor must submit the results of the preclinical tests, together with manufacturing information and analytical data, to the FDA as part of the IND.

The sponsor will also include a protocol detailing, among other things, the objectives of

the first phase of the clinical trial, the parameters to be used in monitoring safety, and the effectiveness criteria to be evaluated, if the first phase lends itself to an efficacy evaluation.

The sponsor will also include a protocol detailing, among other things, the objectives of the first phase of the clinical trial, the parameters to be used in monitoring safety, and the effectiveness criteria to be evaluated, if the first phase lends itself to an efficacy evaluation.

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

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Meetings at other times may be requested.

These meetings can provide an opportunity for the sponsor to share information about the data gathered to date, for the FDA to provide advice, and for the sponsor and FDA

to reach agreement on the next phase of development.

These meetings can provide an opportunity for the sponsor to share information about the data gathered to date, for the FDA to provide advice, and for the sponsor and FDA to reach agreement on the next phase of development.

Sponsors typically use the end of Phase 2 meeting to discuss their Phase 2 clinical results and present their plans for the pivotal Phase 3 clinical trial that they believe will support approval of the new drug.

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In that situation, the product may be approved on the basis of adequate and well-controlled clinical trials establishing that the drug product has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit or on the basis of an effect on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, or IMM, that is reasonably likely to predict an effect on IMM or other clinical benefit.

As a condition of approval, the FDA may require that a

sponsor of a drug receiving accelerated approval perform adequate and well-controlled post-marketing clinical trials.

As a condition of approval, the FDA may require that a sponsor of a drug receiving accelerated approval perform adequate and well-controlled post-marketing clinical trials.

Priority review and accelerated approval do not change the standards for approval, but may expedite the approval process.

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The Hatch-Waxman Amendments permit a patent restoration term of up to five years as compensation for patent term lost during product development and the FDA regulatory review process.

However, patent term restoration cannot extend the remaining term of a patent beyond a total of 14 years from the product’s approval date.

However, patent term

restoration cannot extend the remaining term of a patent beyond a total of 14 years from the product’s approval date.

The patent term restoration period is generally one-half

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Orphan Drug Designation

there is no reasonable expectation that the cost of developing and making available in the United States a drug for this type of disease or condition will be recovered from sales in the United States for that drug.

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

Orphan drug designation must be requested before submitting an NDA.

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The law required the FDA to issue related draft guidance within a year after the law’s enactment and also promulgate confirming regulatory changes.

drugs as well as threshold criteria generally applicable to concluding that a drug is a candidate for these expedited development and review programs.

In May 2014, the FDA published a Guidance for Industry entitled, “Expedited Programs for Serious Conditions-Drugs and Biologics” which provides guidance on FDA programs that are intended to facilitate and expedite development and review of new drugs as well as threshold criteria generally applicable to concluding that a drug is a candidate for these expedited development and review programs.

In addition to the Fast Track, accelerated approval and priority review programs discussed above, the FDA also provided guidance on a new program for Breakthrough Therapy designation.

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Under EU regulatory systems, a company may submit marketing authorization applications either under a centralized or decentralized procedure.

The centralized procedure, which is compulsory for medicinal products

produced by biotechnology or those medicinal products containing new active substances for specific indications such as the treatment of AIDS, cancer, neurodegenerative disorders, diabetes, viral diseases and designated orphan medicines, and optional for other medicines which are highly innovative.

The centralized procedure, which is compulsory for medicinal products produced by biotechnology or those medicinal products containing new active substances for specific indications such as the treatment of AIDS, cancer, neurodegenerative disorders, diabetes, viral diseases and designated orphan medicines, and optional for other medicines which are highly innovative.

Under the centralized procedure, a marketing application is submitted to the EMA where it will be evaluated by the Committee for Medicinal Products for Human Use and a favorable opinion typically results in the grant by the European Commission of a single marketing authorization that is valid for all EU member states within 67 days of receipt of the opinion.

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Under the decentralized approval procedure, an applicant submits an application, or dossier, and related materials to the reference member state and concerned member states.

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

The reference member state prepares a draft

assessment and drafts of the related materials within 120 days after receipt of a valid application.

Within 90 days of receiving the reference member state’s assessment report, each concerned member state must decide whether to approve the assessment report and related materials.

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In the United States, sales of any products for which we may receive regulatory approval for commercial sale will depend in significant part on the availability and adequacy of coverage and reimbursement from third-party payors.

Third-party payors include government authorities,

managed care providers, private health insurers and other organizations.

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

The process for determining whether a payor will provide coverage for a product may be separate from the process for setting the reimbursement rate that the payor will pay for the product.

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Historically, products launched in the EU do not follow price structures of the United States and generally tend to be significantly lower

As of February 21, 2020, we had twenty nine full-time employees, including twenty three engaged in research, development, and regulatory activities, and six in executive, general and administrative functions, and multiple part-time consultants.

Human Capital

As of February 19, 2021, we had forty two full-time employees, including thirty two engaged in research, development, and regulatory activities, and ten in executive, commercial, general and administrative functions, and multiple part-time consultants.

We believe that our future success will be shaped by our continued ability to attract and retain highly skilled employees.

We provide our employees with competitive salaries and bonuses, opportunities for equity ownership in the Company, and an employment package that is designed to promote well-being across all aspects of their lives, including health care, disability, retirement investment options and paid time off.

General Information

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business