What changed in this filing

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Item 1. Financial Statements

2022-11-03 compared with 2022-08-04 · 109 added, 113 removed, 341 unchanged (39% of the section changed)

3 unchanged sentences

in thousands, except share and per share amounts)

September 30,

Current assets:

17 unchanged sentences

Preferred stock, par value $ 0.0001 per share authorized:

5,000,000 shares at June 30, 2022 and December 31, 2021;

1,969,797 shares issued and outstanding at June 30, 2022 and December 31, 2021

5,000,000 shares at September 30, 2022 and December 31, 2021;

1,969,797 shares issued and outstanding at September 30, 2022 and December 31, 2021

Common stock, par value $ 0.0001 per share authorized:

200,000,000 at June 30, 2022 and December 31, 2021;

17,103,395 shares issued and outstanding at June 30, 2022 and December 31, 2021

200,000,000 at September 30, 2022 and December 31, 2021;

17,103,395 and 17,103,395 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively

Additional paid-in-capital

7 unchanged sentences

in thousands, except share and per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Total revenues

13 unchanged sentences

in thousands)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Other comprehensive income (loss):

15 unchanged sentences

Unrealized loss on marketable securities

Issuance of warrants

Hercules warrant

Balance at June 30, 2022

Compensation expense related to stock options for services

Unrealized loss on marketable securities

Balance at September 30, 2022

Balance at December 31, 2020

8 unchanged sentences

Balance at June 30, 2021

Issuance of common shares in equity offering, excluding to related parties, net of transaction costs

Sale of common shares to related parties and exercise of common stock options, net of transaction costs

Compensation expense related to stock options for services

Unrealized loss on marketable securities

Balance at September 30, 2021

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

in thousands)

Six Months Ended

Nine Months Ended September 30,

Cash flows from operating activities:

69 unchanged sentences

To determine whether an other-than-temporary impairment exists, the Company considers whether it intends to sell the debt security and, if the Company does not intend to sell the debt security, it considers available evidence to assess whether it is more likely than not that it will be required to sell the security before the recovery of its amortized cost basis.

During the six months ended June 30, 2022 and 2021, the Company determined it did not have any securities that were other-than- temporarily impaired.

During the nine months ended September 30, 2022 and 2021, the Company determined it did not have any securities that were other-than-temporarily impaired.

Marketable securities are stated at fair value, including accrued interest, with their unrealized gains and losses included as a component of accumulated other comprehensive income or loss, which is a separate component of stockholders’ equity.

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Realized gains and losses are determined on the specific identification method.

During the six months ended June 30, 2022 and 2021, the Company did not have any realized gains or losses on marketable securities.

During the nine months ended September 30, 2022 and 2021, the Company did not have any realized gains or losses on marketable securities.

Fair Value of Financial Instruments

10 unchanged sentences

These inputs include reported trades of and broker-dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities and other observable inputs.

As of June 30, 2022, the Company’s financial assets valued based on Level 1 inputs consisted of cash and cash equivalents in a money market fund, its financial assets valued based on Level 2 inputs consisted of high-grade corporate and government agency bonds and commercial paper, and it had no financial assets valued based on Level 3 inputs.

During the six months ended June 30, 2022 and 2021, the Company did not have any transfers of financial assets between Levels 1 and 2.

As of June 30, 2022 and December 31, 2021, the Company did not have any financial liabilities that were recorded at fair value on a recurring basis on the balance sheet.

As of September 30, 2022, the Company’s financial assets valued based on Level 1 inputs consisted of cash and cash equivalents in a money market fund, its financial assets valued based on Level 2 inputs consisted of high-grade corporate and government agency bonds and commercial paper, and it had no financial assets valued based on Level 3 inputs.

During the nine months ended September 30, 2022 and 2021, the Company did not have any transfers of financial assets between Levels 1 and 2.

As of September 30, 2022 and December 31, 2021, the Company did not have any financial liabilities that were recorded at fair value on a recurring basis on the balance sheet.

Research and Development Costs

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Diluted net loss per common share is computed using the weighted average number of common shares outstanding and the weighted average dilutive potential common shares outstanding using the treasury stock method.

However, for the six months ended June 30, 2022 and 2021, diluted net loss per share is the same as basic net loss per share because the inclusion of weighted average shares of unvested restricted common stock, common stock issuable upon the exercise of stock options, and common stock issuable upon the conversion of preferred stock would be anti-dilutive.

However, for the nine months ended September 30, 2022 and 2021, diluted net loss per share is the same as basic net loss per share because the inclusion of weighted average shares of unvested restricted common stock, common stock issuable upon the exercise of stock options, and common stock issuable upon the conversion of preferred stock would be anti-dilutive.

The following table summarizes outstanding securities not included in the computation of diluted net loss per common share, as their inclusion would be anti-dilutive:

Six Months Ended June 30,

Nine Months Ended September 30,

Common stock options

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Food and Drug Administration (FDA) and other government regulations.

The Company has incurred losses since inception, including approximately $ 128.2 million for the six months ended June 30, 2022, resulting in an accumulated deficit of approximately $ 795.6 million as of June 30, 2022.

The Company has incurred losses since inception, including approximately $ 209.4 million for the nine months ended September 30, 2022, resulting in an accumulated deficit of approximately $ 876.8 million as of September 30, 2022.

Management expects to incur losses for the foreseeable future.

To date, the Company has funded its operations primarily through proceeds from sales of the Company’s capital stock.

In addition, the Company entered into a Loan and Security Agreement (the “Loan

with Hercules Capital, Inc.

and the several banks and other financial institutions or entities party thereto

in May 2022 which provides

for an aggregate of up to $ 250.0 million in term loans, which will be available in four tranches, subject to the Company’s achievement of certain milestones.

first $ 50.0 million tranche was drawn at closing (see Note 6 – Long Term Debt).

The Company believes that its cash, cash equivalents and marketable securities at June 30, 2022 will be sufficient to fund operations past one year from the issuance of these financial statements.

To meet its future capital needs, the Company intends to raise additional capital through debt or equity financings, collaborations, partnerships or other strategic transactions.

However, there can be no assurance that the Company will be able to complete any such transactions on acceptable terms or otherwise.

In addition, the Company entered into a Loan and Security Agreement (the “Loan Facility”) with Hercules Capital, Inc.

and the several banks and other financial institutions or entities party thereto in May 2022 which provides for an aggregate of up to $ 250.0 million in term loans, which will be available in four tranches, subject to the Company’s achievement of certain milestones and conditions.

The first $ 50.0 million tranche was drawn at closing of the Loan Facility (see Note 6 – Long Term Debt).

The inability of the Company to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on the Company’s business, results of operations and financial condition.

The Company has the ability to delay certain research activities and related clinical expenses if necessary due to liquidity concerns until a date when those concerns are relieved.

The Company believes it has the ability to delay certain clinical and pre-commercialization activities and related expenses if necessary due to liquidity concerns until a date when those concerns are relieved.

Company is unable to obtain funding, the Company:

could be forced to delay, reduce or eliminate some or all of its clinical studies or pre-commercialization

efforts, which could adversely affect its business prospects;

could adversely affect liquidity;

and could affect the Company’s ability to maintain compliance with covenants under the Loan Facility.

In accordance with ASC 205-40,

Going Concern (“ASC 205-40”), the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued.

Based upon current operating plans and the Company’s cash, cash equivalents and marketable securities

totaling $ 153.2 million as of September 30, 2022, the Company expects, that such resources will not be sufficient to fund our operating expenses and capital requirements through the one year anniversary of the filing of this Quarterly Report

These conditions raise substantial doubt about the Company’s ability to

continue as a going concern under ASC 205-40.

Under ASC 205-40,

management may not consider the potential for future capital raises through debt or equity financings, collaborations, partnerships or other strategic transactions, or management plans to reduce costs that are not considered probable within the meaning of such accounting standards.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Although the Company has been successful in raising capital in the past, there is no assurance that it will be successful in obtaining such additional financing on terms acceptable to the Company, if at all.

Cash, Cash Equivalents and Marketable Securities

A summary of cash, cash equivalents and available-for-sale

marketable securities held by the Company as of June 30, 2022 and December 31, 2021 is as follows (in thousands):

June 30, 2022

marketable securities held by the Company as of September 30, 2022 and December 31, 2021 is as follows (in thousands):

September 30, 2022

Cash and cash equivalents:

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Corporate debt securities due within 1 year of date of purchase (Level 2)

Corporate debt securities due within 1 to 2 years of date of purchase (Level 2)

Corporate debt securities due within 1 to 2 years of date of purchase

Total cash, cash equivalents and marketable securities

Accrued Liabilities

Accrued liabilities as of June 30, 2022 and December 31, 2021 consisted of the following (in thousands):

Accrued liabilities as of September 30, 2022 and December 31, 2021 consisted of the following (in thousands):

September 30,

Contract research organization costs

4 unchanged sentences

Long Term Debt

In May 2022 the Company and its wholly-owned subsidiary, Canticle Pharmaceuticals, Inc., entered into the

$ 250.0 million Loan Facility with the several banks and other financial institutions or entities party thereto (each, a “Lender” and collectively referred to as the “Lenders”), and Hercules Capital, Inc.

In May 2022 the Company and its wholly-owned subsidiary, Canticle Pharmaceuticals, Inc., entered into the $ 250.0 million Loan Facility with the several banks and other financial institutions or entities party thereto (each, a “Lender” and collectively referred to as the “Lenders”), and Hercules Capital, Inc.

(“Hercules”), in its capacity as administrative agent and collateral agent for itself and the Lenders.

Under the terms of the Loan Facility, the first

$ 50.0 million tranche was drawn at closing.

The Company may also draw up to an additional

$ 125.0 million in two separate tranches upon achievement of certain resmetirom clinical and regulatory milestones.

A fourth tranche of

$ 75.0 million may be drawn by the Company, subject to the approval of Hercules.

Under the terms of the Loan Facility, the first $ 50.0 million tranche was drawn at closing.

The Company may also draw up to an additional $ 125.0 million in two separate tranches upon achievement of certain resmetirom clinical and regulatory milestones.

A fourth tranche of $ 75.0 million may be drawn by the Company, subject to the approval of Hercules.

The Loan Facility has a minimum interest rate of 7.45 % and adjusts with changes in the prime rate.

The Company will pay interest-only monthly payments of accrued interest under the Loan Facility for a period of 30 months, which period may be extended to 36, 48, and 60 months upon the successive achievement of certain clinical and regulatory milestones

and if the Company maintains compliance with applicable covenants.

The Loan Facility matures in May 2026 and may be extended an additional year upon the achievement of certain clinical and regulatory milestones.

The Loan Facility is secured by a security interest in substantially all of the Company’s assets, other than intellectual property.

It includes an end of term charge

of 5.35 % of the aggregate principal amount, which is accounted for in the loan discount.

In connection with the first tranche drawn at closing, the Company issued Hercules a warrant to purchase 14,899 shares, which had a Black-Scholes value of $ 0.6 million.

Additional details of the Loan Facility were filed with the Securities and Exchange Commission (“SEC”) on a Current Report on Form 8-K

on May 9, 2022 and the Loan and Security Agreement associated with the Loan Facility is included as an exhibit to this Quarterly Report on Form 10-Q.

It includes an end of term charge of 5.35 % of the aggregate principal amount, which is accounted for in the loan discount.

In connection with the first tranche drawn at closing, the Company issued Hercules a warrant to purchase 14,899 shares of Company common stock, which had a Black-Scholes value of

$ 0.6 million.

The Loan Facility includes affirmative and restrictive financial covenants commencing on January 1, 2023, including maintenance of a minimum cash, cash equivalents and liquid funds covenant of $ 35.0 million, which may decrease in certain circumstances if the Company achieves certain clinical milestones and a revenue milestone, and a revenue-based covenant that could apply commencing at or after the time that financial reporting is due for the quarter ending September 30, 2024 .

The Loan Facility also includes customary covenants associated with a secured loan facility, including covenants concerning financial reporting obligations, and certain limitations on indebtedness, liens (including a negative pledge on intellectual property and other assets), investments, distributions (including dividends), collateral, investments, distributions, transfers, mergers or acquisitions, taxes, corporate changes, and deposit accounts.

As of June 30, 2022, the outstanding principal under the Loan Facility was $ 50.0 million.

The interest rate as of June 30, 2022 was 8.70 %.

As of June 30, 2022, the Company was in compliance with all loan covenants and provisions.

Future minimum payments, including interest and principal, under the loans payable outstanding as of June 30, 2022 are as follows (in thousands):

Period Ending June 30, 2022:

2022 (remaining six months)

The Loan Facility contains event of default provisions for:

the Company’s failure to make required payments or maintain compliance with covenants under the Loan Facility;

the Company’s breach of certain representations or default under certain obligations outside the Loan Facility;

insolvency, attachment or judgment events affecting the Company;

any circumstance which has occurred or could reasonably be expected to have a material adverse effect on the Company, provided that, any failure to achieve a clinical milestone or approval milestone under the Loan Facility shall not in and of itself constitute a material adverse effect.

The Loan Facility also includes customary

covenants associated with a secured loan facility, including covenants concerning financial reporting obligations, and certain limitations on indebtedness, liens (including a negative pledge on intellectual property and other assets), investments, distributions (including dividends), collateral, investments, distributions, transfers, mergers or acquisitions, taxes, corporate changes, and deposit accounts.

As of September 30, 2022, the outstanding principal under the Loan Facility was $ 50.0 million.

The interest rate as of September 30, 2022 was 10.20 %.

As of September 30, 2022, the Company was in compliance with all loan covenants and provisions.

Future minimum payments, including interest and principal, under the loans payable outstanding as of September 30, 2022 are as follows (in thousands):

Period Ending September 30, 2022:

2022 (remaining three months)

Less amount representing interest

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The terms of the 2021 Sales Agreement are substantially the same as the 2020 Sales Agreement.

The 2021 Sales Agreement authorizes an aggregate offering of up to

$ 200 million in shares of our common stock, from time to time, at the Company’s option, through Cowen as its sales agent.

The 2021 Sales Agreement authorizes an aggregate offering of up to $ 200 million in shares of our common stock, from time to time, at the Company’s option, through Cowen as its sales agent.

The 2021 Sales Agreement supersedes the 2020 Sales Agreement.

Subject to the terms and conditions of the 2021 Sales Agreement, Cowen will use commercially reasonable efforts consistent with its normal trading and sales practices to sell the common stock based upon the Company’s instructions (including any price, time or size limits or other customary parameters or conditions the Company may impose).

of June 30, 2022,

497,043 shares had been sold under the 2021 Sales Agreement for an aggregate of approximately $

40.8 million in gross proceeds, with net proceeds to the Company of approximately $

39.8 million after deducting commissions and other transaction costs.

As of September 30, 2022, 497,043 shares had been sold under the 2021 Sales Agreement for an aggregate of approximately $ 40.8 million in gross proceeds, with net proceeds to the Company of approximately $ 39.8 million after deducting commissions and other transaction costs.

All of those shares were sold in 2021.

As of June 30, 2022, $

159.2 million remained reserved and available for sale under the 2021 Sales Agreement and the Company’s related prospectus supplement.

As of September 30, 2022, $ 159.2 million remained reserved and available for sale under the 2021 Sales Agreement and the Company’s related prospectus supplement.

Stock-based Compensation

4 unchanged sentences

The terms of stock options awarded under the 2015 Stock Plan, in general, are determined by the Compensation Committee, provided the exercise price per share generally shall not be set at less than the fair market value of a share of the common stock on the date of grant and the term shall not be greater than ten years from the date the option is granted.

As of June 30, 2022, the Company had options outstanding to purchase 2,976,545 shares of its common stock, which includes options outstanding under its prior incentive compensation plan, the 2006 Stock Plan.

As of June 30, 2022, 986,322 shares were available for future issuance under the 2015 Stock Plan.

The following table summarizes stock option activity during the six months ended June 30, 2022:

As of September 30, 2022, the Company had options outstanding to purchase 3,026,163 shares of its common stock, which includes options outstanding under its prior incentive compensation plan, the 2006 Stock Plan.

As of September 30, 2022, 936,704 shares were available for future issuance under the 2015 Stock Plan.

The following table summarizes stock option activity during the nine months ended September 30, 2022:

average exercise

2 unchanged sentences

Options cancelled

Outstanding at June 30, 2022

Exercisable at June 30, 2022

The total cash received by the Company as a result of stock option exercises was $ 0 million and $ 0.5 million, respectively, for the six months ended June 30, 2022 and 2021.

The total intrinsic value of options exercised was $ 0 million and $ 0.1 million, respectively, for the six months ended June 30, 2022 and 2021.

The weighted-average grant date fair values, based on the Black-Scholes option model, of options granted during the six months ended June 30, 2022 and 2021 were $ 55.84 and $ 78.34 , respectively.

Outstanding at September 30, 2022

Exercisable at September 30, 2022

The total cash received by the Company as a result of stock option exercises was $ 0 million and $ 0.5 million, respectively, for the nine months ended September 30, 2022 and 2021.

The total intrinsic value of options exercised was $ 0 million and $ 0.1 million, respectively, for the nine months ended September 30, 2022 and 2021.

The weighted-average grant date fair values, based on the Black-Scholes option model, of options granted during the nine months ended September 30, 2022 and 2021 were $ 55.14 and $ 75.71 , respectively.

Stock-Based Compensation Expense

Stock-based compensation expense during the six months ended June 30, 2022 and 2021 was as follows (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Stock-based compensation expense during the nine months ended September 30, 2022 and 2021 was as follows (in thousands):

Three Months Ended September 30,

Nine Months Ended September 30,

Stock-based compensation expense by type of award:

5 unchanged sentences

Total stock-based compensation expense included in net loss

stock-based compensation expense on stock options as of June 30, 2022 was $ 70.0 million with a weighted average remaining period of 2.95 years.

Unrecognized stock-based compensation expense on stock options as of September 30, 2022 was $ 64.2 million with a weighted average remaining period of 2.80 years.

Commitments and Contingencies

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Furthermore, a tiered single-digit royalty is payable on net sales of resmetirom or a product developed from resmetirom, subject to certain reductions.

The Company has not achieved any additional product development or regulatory milestones and had no Licensed Product sales for the six months ended June 30, 2022 and 2021.

The Company has not achieved any additional product development or regulatory milestones and had no Licensed Product sales for the nine months ended September 30, 2022 and 2021.

The Company has entered into customary contractual arrangements and letters of intent in preparation for and in support of the Phase 3 clinical trials.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q

includes “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, that are based on our beliefs and assumptions and on information currently available to us, but are subject to factors beyond our control.

This Quarterly Report on Form 10-Q includes “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, that are based on our beliefs and assumptions and on information currently available to us, but are subject to factors beyond our control.

Forward-looking statements:

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include all statements that are not historical facts;

and can be identified by terms such as “accelerate,” “achieve,” “allow,” “anticipates,” “appear,” “be,” “believes,” “can,” “continue,” “could,” “demonstrates,” ”design,” “estimates,” “expects,” “expectation,” “forecasts,” “future,” “goal,” “help,” “hopeful,” “inform,” “intends,” “may,” “might,” “on track,” “planned,” “planning,” “plans,” “positions,” “potential,” “powers,” “predicts,” ”predictive,” “projects,” “seeks,” “should,” “will,” “will be,” “will achieve,” “would” or similar expressions and the negatives of those terms.

and can be identified by terms such as “accelerate,” “achieve,” “allow,” “anticipates,” “appear,” “be,” “believe,” “believes,” “can,” “continue,” “could,” “demonstrates,” ”design,” “estimates,” “expects,” “expectation,” “forecasts,” “future,” “goal,” “help,” “hopeful,” “inform,” “intends,” “may,” “might,” “on track,” “planned,” “planning,” “plans,” “positions,” “potential,” “powers,” “predicts,” ”predictive,” “projects,” “seeks,” “should,” “will,” “will be,” “will achieve,” “would” or similar expressions and the negatives of those terms.

In particular, forward-looking statements contained in or incorporated by reference to this Quarterly Report relate to, among other things:

3 unchanged sentences

Our ability to delay certain research activities and related clinical expenses as necessary;

Our historic operating costs and financial resources at September 30, 2022 indicate substantial doubt exists related to our ability to continue as a going concern under ASC 205-40 without the completion of future debt or equity financings, collaborations, partnerships or other strategic transactions;

absent completion of a financing transaction to address such shortfall on acceptable terms when needed, the Company could be subjected to the adverse effects described in this document under Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations ;

Liquidity and Capital Resources;”

Our clinical trials, including the anticipated timing of disclosure, presentations of data from, or outcomes from our trials,

Research and development activities, and the timing and results associated with the future development of our lead product candidate, resmetirom (formerly known as MGL-3196),

including projected market size, sector leadership, and patient treatment estimates for non-alcoholic

steatohepatitis (“NASH”) and non-alcoholic

fatty liver disease (“NAFLD”) patients;

The timing and completion of projected future clinical milestone events, including enrollment, additional studies, top-line

data and open label projections;

Research and development activities, and the timing and results associated with the future development of our lead product candidate, resmetirom (formerly known as MGL-3196), including projected market size, sector leadership, and patient treatment estimates for non-alcoholic steatohepatitis (“NASH”) and non-alcoholic fatty liver disease (“NAFLD”) patients;

The timing and completion of projected future clinical milestone events, including enrollment, additional studies, top-line data and open label projections;

Plans, objectives and timing for making a Subpart H (Accelerated Approval of New Drugs for Serious or Life-Threatening Illnesses) submission to FDA;

Projections or objectives for obtaining accelerated or full approval for resmetirom for non-cirrhotic

NASH patients and NASH patients with compensated cirrhosis;

Projections or objectives for obtaining accelerated or full approval for resmetirom for non-cirrhotic NASH patients and NASH patients with compensated cirrhosis;

Our primary and key secondary study endpoints for resmetirom, and the potential for achieving such endpoints and projections, including NASH resolution, safety, fibrosis treatment, cardiovascular effects, and lipid treatment with resmetirom;

Optimal dosing levels for resmetirom and projections regarding potential NASH or NAFLD and potential patient benefits with resmetirom, including future NASH resolution, safety, fibrosis treatment, cardiovascular effects, lipid treatment, and/or biomarker effects with resmetirom;

The potential efficacy and safety of resmetirom for non-cirrhotic

NASH patients and cirrhotic NASH patients;

The potential for resmetirom to become the best-in-class

and/or first-to-market

treatment option for patients with NASH and liver fibrosis;

Our ability to address the unmet needs of patients suffering from NASH with significant fibrosis;

The potential efficacy and safety of resmetirom for non-cirrhotic NASH patients and cirrhotic NASH patients;

The potential for resmetirom to become the best-in-class and/or first-to-market treatment option for patients with NASH and liver fibrosis;

Anticipated or estimated future results of operations and expenses as we expand our resmetirom clinical development program and our commercial development program;

launch/partnering plans;

The ability to develop clinical evidence demonstrating the utility of non-invasive

tools and techniques to screen and diagnose NASH and/or NAFLD patients;

The predictive power of liver fat reduction with resmetirom, as measured by non-invasive

tests, on NASH resolution and/or fibrosis reduction or improvement, and potential NASH or NAFLD patient risk profile benefits with resmetirom;

The ability to develop clinical evidence demonstrating the utility of non-invasive tools and techniques to screen and diagnose NASH and/or NAFLD patients;

The predictive power of liver fat reduction with resmetirom, as measured by non-invasive tests, on NASH resolution and/or fibrosis reduction or improvement, and potential NASH or NAFLD patient risk profile benefits with resmetirom;

The predictive power of liver fat, liver volume changes, or MAST scores for NASH and/or NAFLD patients;

The predictive power of NASH resolution and/or liver fibrosis reduction or improvement with resmetirom using non-invasive

tests, including the use of ELF, FibroScan, MRE and/or MRI-PDFF;

The predictive power of non-invasive

tests generally, including for purposes of diagnosing NASH, monitoring patient response to resmetirom, or recruiting and conducting a NASH clinical trial;

The predictive power of NASH resolution and/or liver fibrosis reduction or improvement with resmetirom using non-invasive tests, including the use of ELF, FibroScan, MRE and/or MRI-PDFF;

The predictive power of non-invasive tests generally, including for purposes of diagnosing NASH, monitoring patient response to resmetirom, or recruiting and conducting a NASH clinical trial;

Market demand for and acceptance of our products;

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Forward-looking statements are subject to a number of risks and uncertainties including, but not limited to:

our clinical development of resmetirom;

enrollment and trial conclusion uncertainties, generally and in relation to COVID-19

related measures and individual precautionary measures that may be implemented or continued for an uncertain period of time;

our potential inability to raise sufficient capital to fund our ongoing operations as currently planned or to obtain financings on terms similar to those we have arranged in the past;

our clinical and commercial development of resmetirom;

enrollment and trial outlook uncertainties, generally, based on blinded, locked or limited trial data and in relation to COVID-19 related measures and individual precautionary measures that may be implemented or continued for an uncertain period of time;

our potential inability to raise sufficient capital to fund our ongoing operations as currently planned, continue as a going concern and to obtain financings on terms similar to those we have arranged in the past;

our ability to service our indebtedness and otherwise comply with our debt covenants;

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the risks of achieving potential benefits in studies that includes substantially more patients, and patients with different disease states, than our prior studies;

limitations associated with early stage or non-placebo

controlled study data;

limitations associated with early stage or non-placebo controlled study data;

the timing and outcomes of clinical studies of resmetirom;

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Securities and Exchange Commission for more detailed information regarding these risks and uncertainties and other factors that may cause actual results to differ materially from those expressed or implied.

We specifically discuss these risks and uncertainties in greater detail in the section appearing in Part I, Item 1A of our Annual Report on Form 10-K

for the year ended December 31, 2021, filed with the SEC on February 25, 2022 (the “2021 Form 10-K”),

as updated by the risk factors discussed in Part II, Item 1A of our Quarterly Report on Form 10-Q

for the quarter ended March 31, 2022 filed with the SEC on May 9, 2022 (the “1Q 2022 Form 10-Q”),

as well as in our other filings with the SEC.

You should read the 2021 Form 10-K,

the 1Q 2022 Form 10-Q,

this Quarterly Report, and the other documents that we file or have filed with the SEC, with the understanding that our actual future results may be materially different from the results expressed or implied by these forward-looking statements.

We specifically discuss these risks and uncertainties in greater detail in the section appearing in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022 (the “2021 Form 10-K”), as updated by the risk factors discussed in Part II, Item 1A of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 filed with the SEC on May 9, 2022 (the “1Q 2022 Form 10-Q”), as well as in our other filings with the SEC.

You should read the 2021 Form 10-K, the 1Q 2022 Form 10-Q, this Quarterly Report, and the other documents that we file or have filed with the SEC, with the understanding that our actual future results may be materially different from the results expressed or implied by these forward-looking statements.

Moreover, we operate in an evolving environment.

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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 1. Financial Statements