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Item 1A. Risk Factors

2026-02-19 compared with 2025-02-26 · 349 added, 264 removed, 829 unchanged (43% of the section changed)

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Risks Related to the Commercialization and Continued Approval of Rezdiffra

Our prospects are highly dependent on the success of our only approved product, Rezdiffra, which was approved in the United States under the Subpart H accelerated approval pathway for new drugs for serious or life-threatening illnesses.

If we are unable to successfully commercialize or maintain approval for Rezdiffra, our business, financial condition, results of operations and prospects and the value of our common stock will be materially adversely affected.

In March 2024, the FDA granted accelerated approval for Rezdiffra in conjunction with diet and exercise for the treatment of adults with noncirrhotic MASH with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis).

We have invested, and continue to invest, significant efforts and financial resources in the launch of Rezdiffra.

We have never, as an organization, launched or commercialized any other product, and there is no guarantee that we will be able to successfully commercialize Rezdiffra.

We have never, as an organization, launched or commercialized any other product, and there is no guarantee that we will continue to successfully commercialize Rezdiffra.

There are numerous examples of failures to meet high expectations of market potential, including by pharmaceutical companies with more experience and resources than us.

We believe that the commercial success of Rezdiffra depends on many factors, including the following:

• our ability to effectively educate healthcare providers and patients on the risks of MASH and the potential clinical benefits of Rezdiffra, the first FDA-approved treatment in MASH;

• our ability to effectively educate healthcare providers and patients on the risks of MASH and the potential clinical benefits of Rezdiffra;

• the efficacy, cost, approved use, and side-effect profile of Rezdiffra relative to competitive treatment regimens for the treatment of MASH;

• Rezdiffra may compete with the off-label use of currently marketed products and other therapies in development that may in the future obtain approval for MASH;

• the effectiveness of our commercial strategy for the marketing of Rezdiffra, including our pricing strategy and the effectiveness of our efforts to obtain adequate third-party reimbursements;

• the effectiveness of our commercial strategy for the marketing of Rezdiffra, including our pricing strategy and the effectiveness of our efforts to obtain and maintain adequate third-party reimbursements;

• developing, maintaining and successfully monitoring commercial manufacturing arrangements for Rezdiffra with third-party manufacturers to ensure they meet our standards and those of regulatory authorities, including the FDA, which extensively regulate and monitor pharmaceutical manufacturing facilities;

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• the acceptance of Rezdiffra by physicians, patients and third-party payors;

• our ability to remain compliant with laws and regulations that apply to us and our commercial activities;

• our ability to remain compliant with laws and regulations that apply to us and our commercial, promotional and medical activities;

• the actual market-size, ability to identify targeted patients and the demographics of patients eligible for Rezdiffra, which may be different than what we currently expect;

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• the effect of recent or potential health care legislation in the United States.

While we believe that Rezdiffra has a commercially competitive profile, we cannot accurately predict the amount of time needed to attain a commercially successful profile or the amount of revenue that would be generated from the sale

of Rezdiffra.

While we believe that Rezdiffra has a commercially competitive profile, we cannot accurately predict the amount of revenue that would be generated from the sale of Rezdiffra.

If we do not effectively commercialize Rezdiffra, we will not be able to execute our business plan and may not be able to achieve profitability.

If our revenues, market share or other indicators of market acceptance of Rezdiffra do not meet the expectations of investors or public market analysts, the market price of our common stock would likely decline.

We obtained regulatory approval of Rezdiffra through the Subpart H accelerated approval pathway, and full approval will be contingent on successful completion of a confirmatory post-marketing trial.

We obtained regulatory approval of Rezdiffra through the Subpart H accelerated approval pathway in the United States and Rezdiffra has received a CMA in the EU.

Full approvals will be contingent on the completion of trials to successfully confirm the clinical benefit of Rezdiffra.

Failure to obtain full approval or otherwise meet our post-marketing requirements and commitments would have a material adverse effect on our business.

The FDA approved Rezdiffra under the accelerated approval pathway for new drugs for serious or life-threatening illnesses and was supported by 52-week data from the Phase 3 MAESTRO-NASH trial, which achieved both primary endpoints—MASH resolution with no worsening of fibrosis and an improvement in fibrosis by at least one stage with no worsening of the NAFLD activity score.

The FDA approved Rezdiffra under the accelerated approval pathway for new drugs for serious or life-threatening illnesses and the EC granted a CMA for Rezdiffra in the EU.

The approvals were supported by 52-week data from the Phase 3 MAESTRO-NASH trial, which achieved both primary endpoints—MASH resolution with no worsening of fibrosis and an improvement in fibrosis by at least one stage with no worsening of the NAFLD activity score.

In connection with the FDA’s accelerated approval, we have agreed to certain post-marketing commitments, including completing our MAESTRO-NASH trial to demonstrate a clinical benefit of Rezdiffra on composite endpoints.

Our MAESTRO-NASH trial is ongoing as a 54-month outcomes trial designed to generate confirmatory outcomes data that, if positive, is expected to verify a clinical benefit and support the full approval of Rezdiffra.

Additionally, full approval could also be based on results from our MAESTRO-NASH OUTCOMES trial that will noninvasively measure progression to liver decompensation events in patients with compensated MASH cirrhosis.

Positive data from our MAESTRO-NASH OUTCOMES trial is expected to support the full approval of Rezdiffra in noncirrhotic MASH and support approval for patients with compensated cirrhosis, expanding the eligible patient population.

Failure to meet post-marketing commitments and requirements, including completion of enrollment of—and in particular, any failure to obtain positive data from—any confirmatory studies required by the FDA, could result in negative regulatory action from the FDA and/or withdrawal of such accelerated approval.

The recently enacted Food and Drug Omnibus Reform Act has expanded FDA’s expedited withdrawal procedures for drugs approved through the accelerated approval pathway if a sponsor fails to conduct any required post-approval study with due diligence.

Positive data from our MAESTRO-NASH OUTCOMES trial is expected to support the full approval of Rezdiffra in noncirrhotic MASH in the U.S.

and support approval for patients with compensated cirrhosis (F4c), expanding the eligible patient population for Rezdiffra.

We have agreed to submit results from these trials to the EMA in support of transitioning the CMA into a standard marketing authorization for Rezdiffra in the EU.

Failure to meet post-marketing commitments and requirements, and in particular, any failure to obtain positive data from any studies designed to confirm clinical benefit, could result in negative regulatory action and/or withdrawal of such approvals.

The recently enacted FDORA has expanded FDA’s expedited withdrawal procedures for drugs approved through the accelerated approval pathway if a sponsor fails to conduct any required post-approval study with due diligence.

A CMA is granted on the basis of less comprehensive clinical data than is normally required and is valid for one year, renewable annually, and subject to specific post-authorization obligations, such as clinical studies.

If we fail to complete these obligations on time, if new data do not confirm a positive benefit-risk profile, or if new safety, efficacy or quality issues arise, the EC may decline to renew, vary, suspend or revoke the CMA or decline to convert it to a standard marketing authorization based on a respective recommendation by the EMA.

Any such action may limit or prevent commercialization of Rezdiffra in the EU and could have a material adverse effect on our business.

There is no assurance that the EC will grant full approval of Rezdiffra in the EU or that any such approval will be on commercially acceptable terms.

The commercial success of Rezdiffra will depend on the degree of market acceptance by physicians, patients, third-party payors and others in the health care community.

Despite receiving FDA approval of Rezdiffra, our product may not gain, or over time may not retain, market acceptance by physicians, patients, third-party payors or others in the health care community.

Rezdiffra was the first product approved by the FDA for the treatment of MASH.

Despite receiving FDA and EC approval of Rezdiffra, our product may not gain, or over time may not retain, market acceptance by physicians, patients, third-party payors or others in the health care community.

Rezdiffra was the first product approved by the FDA and EC for the treatment of MASH.

Accordingly, we must educate healthcare providers and patients on the risks of MASH and the potential clinical benefits and appropriate use of Rezdiffra.

If Rezdiffra does not achieve and maintain an adequate level of acceptance, it is likely that we will not generate significant revenue or become profitable.

The degree of market acceptance of Rezdiffra, which we launched in the United States early in the second quarter of 2024, is also dependent on a number of additional factors, including the following:

If Rezdiffra does not achieve and maintain an adequate level of acceptance, it is likely that we will not generate significant revenue or become

The degree of market acceptance of Rezdiffra is also dependent on a number of additional factors, including the following:

• the willingness of physicians to prescribe, and our target patient population to use, Rezdiffra;

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While many of our officers and employees have experience commercializing drug products with prior companies, we have never as an organization engaged in commercial activities prior to the approval of Rezdiffra.

We have hired and trained a commercial team and developed the organizational infrastructure we believe we need to support the commercial

success of Rezdiffra, and we continue to invest time and financial resources in optimizing this infrastructure.

We have hired and trained a commercial team and developed the organizational infrastructure we believe we need to support the commercial success of Rezdiffra in the U.S.

and EU, and we continue to invest time and financial resources in optimizing this infrastructure.

Factors that may inhibit our efforts to maintain and further develop commercial capabilities include:

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If we are not successful in maintaining our commercial infrastructure, of if our commercial capabilities are not effective, we will encounter difficulty in achieving, maintaining or increasing projected sales of Rezdiffra, which would adversely affect our business and financial position.

We may become subject to unfavorable pricing regulations or third-party coverage and reimbursement policies, which would harm our business.

Our ability to successfully commercialize Rezdiffra and any future product candidate will depend in part on the extent to which coverage and reimbursement for these drugs and drug candidates and related treatments will be available from government authorities, private health insurers and other organizations.

If we are unable to obtain or maintain adequate coverage and reimbursement from government or third-party payors for Rezdiffra or, if approved, any other product candidates, our prospects for generating revenue may be adversely affected.

Our ability to successfully commercialize Rezdiffra and any future product candidate, if approved, will depend in part on the extent to which coverage and reimbursement for these drugs will be available from third party payors, including government authorities (such as Medicare and Medicaid programs in the U.S.), managed care organizations and private health insurers.

See the section titled “Business—Government Regulation—Coverage and Reimbursement” in this Annual Report for more information.

In the United States and markets in other countries, patients generally rely on third-party payors to reimburse all or part of the costs associated with their treatment.

Adequate coverage and reimbursement from governmental healthcare programs, such as Medicare and Medicaid, and commercial payors is critical to new product acceptance.

Our ability to successfully commercialize Rezdiffra and any additional products will depend in part on the extent to which coverage and adequate reimbursement for these products and related treatments will be available from government health administration authorities, private health insurers and other organizations.

Government authorities and other third-party payors, such as private health insurers and health maintenance organizations, decide which medications they will pay for and establish reimbursement levels.

In the United States, the principal decisions about reimbursement for new medicines are typically made by the Centers for Medicare & Medicaid Services (“CMS”), an agency within the U.S.

Department of Health and Human Services (“HHS”).

CMS decides whether and to what extent a new medicine will be covered and reimbursed under Medicare and private payors tend to follow CMS to a substantial degree.

The availability of coverage and extent of reimbursement by governmental and private payors is essential for most patients to be able to afford treatments.

Sales of these or other products that we may identify will depend substantially, both domestically and abroad, on the extent to which the costs of our products will be paid by health maintenance, managed care, pharmacy benefit and similar healthcare management organizations, or reimbursed by government health administration authorities, private health coverage insurers and other third-party payors.

If coverage and adequate reimbursement is not available, or is available only to limited levels, we may not be able to successfully commercialize Rezdiffra or any other future product candidate.

Even if coverage is provided, the approved reimbursement amount may not be high enough to allow us to establish or maintain pricing sufficient to realize a sufficient return on our investment.

In the United States and other countries, patients generally rely on third-party payors to reimburse all or part of the costs associated with their treatment.

Without third party payor reimbursement, patients may not be able to obtain or afford prescribed medications.

Adequate coverage and reimbursement from governmental healthcare programs, such as Medicare and Medicaid, and commercial payors is critical to successful commercialization.

Our ability to successfully commercialize Rezdiffra and any additional products in the future will depend in part on the extent to which coverage and adequate reimbursement for these products and related treatments will be available from government health administration authorities, private health insurers and other organizations.

In addition, coverage and reimbursement guidelines by third party payors may have a significant impact on the prescribing physicians’ willingness and ability to prescribe Rezdiffra or

any other future product.

The demand for, and the commercial success of, Rezdiffra could be materially harmed if state Medicaid programs, the Medicare program, other healthcare programs in the U.S.

or elsewhere, or third party commercial payors in the U.S.

or elsewhere, deny reimbursement for Rezdiffra or provide reimbursement only on unfavorable terms.

A primary trend in the U.S.

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Government authorities and other third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular drugs.

Net prices for drugs may also be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the United States.

For example, third party payors may require prior authorization for, and require reauthorization for continuation of, prescription products or impose step edits, which require prior use of another medication, prior to approving coverage for a particular product.

We cannot predict actions that third party payors may take, or whether they will limit the access and level of reimbursement for Rezdiffra or refuse to provide any approvals or coverage.

In addition, net prices for drugs may also be reduced by mandatory discounts or rebates required by government healthcare programs or private payors.

Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for drugs.

We cannot be sure that coverage will be available or maintained for Rezdiffra or any drug candidate that we commercialize and, if coverage is available, the level of reimbursement.

Reimbursement may impact the demand for, or the price of, Rezdiffra or any future drug candidate for which we obtain marketing approval.

If reimbursement is not available or is available only to limited levels, we may not be able to successfully commercialize Rezdiffra or any future drug candidate for which we obtain marketing approval.

Many pharmaceutical manufacturers must also calculate and report certain price reporting metrics to the government, such as average sales price (“ASP”) and best price.

Penalties may apply

in some cases when such metrics are not submitted accurately and timely.

Further, these prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs.

There may be significant delays in obtaining reimbursement for newly approved drugs, and coverage may be more limited than the purposes for which the drug is approved by the FDA or similar regulatory authorities outside the United States.

Moreover, eligibility for reimbursement does not imply that any drug will be paid for in all cases or at a rate that covers our costs, including research, development, manufacture, sale and distribution.

Interim reimbursement levels for new drugs, if applicable, may also not be sufficient to cover our costs and may not be made permanent.

Reimbursement rates may vary according to the use of the drug and the clinical setting in which it is used, may be based on reimbursement levels already set for lower-cost drugs and may be incorporated into existing payments for other services.

Net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the United States.

Private third-party payors often rely upon Medicare coverage policy in setting their own reimbursement policies.

Our inability to promptly obtain coverage and profitable payment rates from both government-funded and private payors for Rezdiffra or any future approved drugs that we develop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize drugs and our overall financial condition.

The availability of coverage and extent of reimbursement by governmental and private payors is essential for most patients to be able to afford treatments.

Pharmacy benefit managers (“PBMs”), other similar organizations and payors can limit coverage to specific products on an approved list, or formulary, which might not include all of the approved products for a particular indication, exclude drugs from their formularies in favor of competitor drugs or alternative treatments, place drugs on formulary tiers with higher patient co-pay obligations, and/or mandate stricter utilization criteria.

Formulary exclusion effectively encourages patients and providers to seek alternative treatments, make a complex and time-intensive request for medical exemptions, or pay 100% of the cost of a drug.

In addition, in many instances, certain PBMs, other similar organizations and third party payors may exert negotiating leverage by requiring incremental rebates, discounts or other concessions from manufacturers in order to maintain formulary positions, which could result in higher gross to net deductions for affected products.

The market for PBM services has become highly concentrated and vertically integrated, giving these entities further leverage in negotiating rebates, discounts or other concessions.

In this regard, we have entered into agreements with PBMs and payor accounts to provide rebates to those entities related to formulary coverage for Rezdiffra, but we cannot guarantee that we will be able to agree to coverage terms with other PBMs and other third party payors.

Payors could decide to exclude Rezdiffra from formulary coverage lists, impose step edits that require patients to try alternative treatments before authorizing payment for Rezdiffra, or impose a moratorium on coverage for Rezdiffra while the payor makes a coverage decision.

An inability to maintain adequate formulary positions could increase patient cost-sharing and cause some patients to determine not to use Rezdiffra.

Any delays or unforeseen difficulties in reimbursement approvals could limit patient access, depress therapy adherence rates, and adversely impact our ability to successfully commercialize Rezdiffra.

In addition, PBMs and other third-party payors could implement alternative funding programs that could have an impact on product revenue.

Further, prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs.

If we are unsuccessful in maintaining broad coverage for Rezdiffra, our anticipated revenue from and growth prospects for Rezdiffra could be negatively affected.

The pricing of pharmaceutical products has come under increasing scrutiny as part of a global trend toward healthcare cost containment.

Resulting changes in healthcare law and policy, including recently enacted changes to Medicare, may impact our business in ways that we cannot currently predict, which could have a material adverse effect on our business and financial condition.

Resulting changes in healthcare law and policy, including changes to Medicare, may impact our business in ways that we cannot currently predict, which could have a material adverse effect on our business and financial condition.

The United States and several foreign jurisdictions are considering, or have already enacted, a number of legislative and regulatory proposals to change the healthcare system in ways that could affect our ability to sell our products profitably.

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Failure to pay a discount under this new program will be subject to a civil monetary penalty.

Congress continues to examine various policy proposals that may result in pressure on

the prices of prescription drugs in the government health benefit programs.

The IRA or other legislative changes could impact the market conditions for our product candidate.

Congress continues to examine various policy proposals that may result in pressure on the prices of prescription drugs in the government health benefit programs.

The effect of the IRA on our business and the healthcare industry in general continues to evolve and we may discover adverse impacts on our company or our industry.

The IRA is anticipated to have significant effects on the pharmaceutical industry and may reduce the prices we can charge and reimbursement we can receive for our product, among other effects.

Moreover, increasing efforts by governmental and third-party payors in the United States and abroad to cap or reduce healthcare costs may cause such organizations to limit both coverage and the level of reimbursement for newly approved products and, as a result, they may not cover or provide adequate payment for our product candidates.

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The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize our products.

Rezdiffra remains subject to ongoing regulatory review, and if we fail to comply with continuing regulations, we could lose our approval and the sale of Rezdiffra could be suspended.

Even though we received FDA accelerated approval for Rezdiffra, the manufacturing, labeling, packaging, distribution, adverse event reporting, storage, advertising, promotion, sampling, and record keeping related to our product will remain subject to extensive regulatory requirements.

Federal legislative and regulatory efforts to implement reference pricing or most-favored-nation pricing models could impact our product revenues and harm our business.

On May 12, 2025, President Trump issued an executive order calling on pharmaceutical manufacturers to voluntarily reduce the prices of medicines in the U.S.

and directing the Secretary of Health and Human Services (HHS) to communicate most-favored-nation (MFN) price targets to pharmaceutical manufacturers to align prices with those in comparably developed nations and, in the event significant progress towards MFN pricing is not delivered, to propose rulemaking to impose MFN pricing.

Since the May 12, 2025 order, the Trump administration has continued to exert pressure on drug manufacturers to implement MFN pricing, including by suggesting that the administration may impose significant tariffs on pharmaceuticals if such manufacturers do not reach agreements to implement MFN pricing.

Further, in November 2025, the Centers for Medicare & Medicaid Services (CMS) introduced the GENEROUS (GENErating cost Reductions fOr U.S.

Medicaid) Model, a voluntary Medicaid payment initiative under which participating drug manufacturers may voluntarily offer supplemental rebates to participating state Medicaid programs that are intended to provide such Medicaid programs with an MFN price for the manufacturers’ products.

Additionally, in December 2025, CMS announced proposals for new mandatory demonstration payment models through two proposed rules under its Center for Medicare and Medicaid Innovation (“CMMI”) authority, the Global Benchmark for Efficient Drug Pricing (GLOBE) for Medicare Part B and Guarding U.S.

Medicare Against Rising Drug Costs (GUARD) for Medicare Part D.

If finalized, these models would impose additional mandatory rebates on manufacturers of certain Medicare Part B and Medicare Part D drugs, for select

Medicare populations intended to represent 25% of Medicare patients, if the Medicare prices for such products exceed those paid in economically comparable countries.

Both the GLOBE and GUARD models have proposed seven-year testing periods, with the GLOBE model proposed to begin on October 1, 2026 and the GUARD model proposed to begin on January 1, 2027.

If the GLOBE and GUARD models are finalized as proposed under CMMI authority, we could be required to pay additional rebates on products reimbursed by Medicare for the covered populations during the applicable model periods.

In addition, if MFN pricing or similar reference pricing policies are enacted or implemented in the U.S.

outside of the CMMI framework and applied more broadly, we could be required to pay rebates on products on utilization by a broader portion of U.S.

patients to align with prices in certain reference countries.

We currently derive the substantial portion of our revenue from U.S.

sales, and any requirement to pay additional rebates in the U.S.

to match international reference prices would impact our overall net revenue.

MFN pricing models in the U.S.

could also affect our international pricing strategy and future decisions on reimbursement and commercialization in certain jurisdictions.

pricing becomes tied to international reference prices, we may face decisions regarding pricing in foreign markets that could result in reduced patient access internationally, affect our relationships with foreign regulatory authorities and payers, or impact our ability to obtain or maintain reimbursement approvals in ex-U.S.

These reforms remain subject to change, potential legal challenges, or expansion through additional rulemaking or sub‑regulatory guidance, creating uncertainty for our overall pricing strategy.

It remains to be seen whether and how these drug pricing initiatives will apply to Rezdiffra, how they will affect the broader pharmaceutical industry, and whether similar reform measures may be adopted in the future.

Like all medicinal products, Rezdiffra remains subject to ongoing regulatory review, and if we fail to comply with regulations or satisfy our post-approval commitments, we could lose our approval and the sale of Rezdiffra could be suspended.

Even though we received FDA accelerated approval and EC CMA for Rezdiffra, the manufacturing, labeling, packaging, distribution, adverse event reporting, storage, advertising, promotion, sampling, and record keeping related to our product will remain subject to extensive regulatory requirements.

These requirements include submissions of safety and other post-marketing information and reports, registration, as well as continued compliance with cGMP regulations, and GCPs for any clinical trials that we conduct post-approval, all of which may result in significant expense and limit our ability to commercialize Rezdiffra.

As such, we and our contract manufacturers will be subject to periodic review and inspections to assess compliance with cGMP and adherence to commitments made in any NDA or other marketing application and previous responses to inspection observations.

For certain commercial prescription drug products, manufacturers and other parties involved in the supply chain must also meet chain of distribution requirements and build electronic, interoperable systems for product tracking and tracing and for notifying the FDA of counterfeit, diverted, stolen and intentionally adulterated products or other products that are otherwise unfit for distribution in the United States.

Further, the FDA and other regulatory agencies closely regulate the post-approval marketing and promotion of drugs to ensure that they are marketed only for the approved indications and in accordance with the provisions of the approved labeling.

In the current administration, the FDA has increased its enforcement scrutiny over prescription drug advertising, particularly direct-to-consumer product promotion and advertising.

The FDA and other regulatory agencies impose stringent restrictions on manufacturers’ communications regarding off-label use, and if we do not market our products for their approved indications, we may be subject to enforcement action for off-label marketing by the FDA and other federal and state enforcement agencies, including the United States Department of Justice.

Violation of the Federal Food, Drug, and Cosmetic Act and other statutes, including the False Claims Act, relating to the promotion and advertising of prescription products may also lead to investigations or allegations of violations of federal and state health care fraud and abuse laws and state consumer protection laws.

For certain commercial prescription drug products, manufacturers and other parties involved in the supply chain must also meet chain of distribution requirements and build electronic, interoperable systems for product tracking and tracing and for notifying the FDA and regulators in other territories of counterfeit, diverted, stolen and intentionally adulterated products or other products that are otherwise unfit for distribution in the United States or other territories, respectively.

Accordingly, we and others with whom we work must continue to expend time, money, and effort in all areas of regulatory compliance, including manufacturing, production and quality control.

The FDA may also require a REMS program as a condition of approval of Rezdiffra or any future product candidates, which could include requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.

If we fail to comply with the regulatory requirements of the FDA and other applicable domestic and foreign regulatory authorities, or previously unknown problems with Rezdiffra, manufacturer, or manufacturing process are discovered, we could be subject to administrative or judicially imposed sanctions, including:

Regulatory authorities in the EU also have broad discretion to impose additional conditions, require labelling changes, restrict indications or distribution, require additional monitoring or risk minimization measures, or suspend or withdraw authorizations based on new safety, quality or efficacy information,

including information arising from real-world use.

Other regulatory elements may also be added by other health authorities throughout the world.

If we fail to comply with the regulatory requirements of the FDA, the EMA and other applicable domestic and foreign regulatory authorities, or previously unknown problems with Rezdiffra, manufacturer, or manufacturing process are discovered, we could be subject to administrative or judicially imposed sanctions, including:

• restrictions on marketing or manufacturing of Rezdiffra;

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Rezdiffra could develop unexpected safety or efficacy concerns, which would likely have a material adverse effect on us.

Rezdiffra was granted accelerated approval from the FDA based on 52-week data from the MAESTRO-NASH trial and additional safety data from the Phase 3 MAESTRO-NAFLD-1 and MAESTRO-NAFLD-OLE extensions trials.

In the United States, Rezdiffra will now be used by more patients, potentially for longer periods of time, and we and others (including regulatory agencies and private payors) will collect extensive information on the efficacy and safety of Rezdiffra by monitoring its use in the marketplace.

The regulatory approvals for Rezdiffra were supported by 52-week data from the MAESTRO-NASH trial and additional safety data from the Phase 3 MAESTRO-NAFLD-1 and MAESTRO-NAFLD-OLE extensions trials.

Rezdiffra will now be used by more patients, potentially for longer periods of time, and we and others (including regulatory agencies and private payors) will collect extensive information on the efficacy and safety of Rezdiffra by monitoring its use in the marketplace.

In addition, we are generating confirmatory data regarding the longer-term use of Rezdiffra in two ongoing trials.

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Relative to us, many of these entities have substantially greater capital resources, research and development staffs, facilities and experience in conducting clinical studies, obtaining regulatory approvals, and manufacturing and marketing pharmaceutical products.

While Rezdiffra is currently the only FDA approved drug for the treatment of MASH, there are over 150 drugs in development for the potential treatment of MASH by companies ranging in size from private biotech companies to large pharma organizations.

There are over 140 drugs in development for the potential treatment of MASH by companies ranging in size from private biotech companies to large pharmaceutical organizations.

See the section titled “Business—Competition” in this Annual Report for more information.

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Rezdiffra was approved for treatment in a limited population of patients with MASH with moderate to advanced liver fibrosis, and additional clinical trials and regulatory applications will be required to expand its indication.

be successful in these trials or in obtaining such regulatory approval, which may materially adversely affect our prospects and the value of our common stock.

The FDA granted accelerated approval of Rezdiffra for the treatment of MASH with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis).

We may not be successful in these trials or in obtaining such regulatory approval, which may materially adversely affect our prospects and the value of our common stock.

The FDA granted accelerated approval of, and the EC granted a CMA for, Rezdiffra for the treatment of MASH with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis).

A key component to our corporate strategy is to expand the target patient population for Rezdiffra.

We have fully enrolled our Phase 3 MAESTRO-NASH OUTCOMES trial.

In this trial, we are evaluating progression to liver decompensation events in patients with compensated MASH cirrhosis treated with Rezdiffra versus placebo.

A positive outcome is expected to support the full approval of Rezdiffra for noncirrhotic MASH and also expand the eligible patient population for Rezdiffra with an additional indication in patients with compensated MASH cirrhosis.

In this trial, we are evaluating progression to liver decompensation events in patients with compensated MASH cirrhosis (F4c) treated with Rezdiffra versus placebo.

A positive outcome is expected to support the full approval of Rezdiffra for noncirrhotic MASH in the U.S.

and also expand the eligible patient population for Rezdiffra with an additional indication in patients with compensated MASH cirrhosis.

We cannot guarantee positive results in this trial.

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If we do not obtain regulatory approval of Rezdiffra in foreign jurisdictions, we will not be able to market Rezdiffra in other jurisdictions, which will limit our commercial revenues.

While Rezdiffra has been approved by the FDA for the treatment of noncirrhotic MASH with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis), it has not been approved in any other jurisdiction for this indication or for any other indication.

While Rezdiffra has been approved by the FDA and EC for the treatment of noncirrhotic MASH with moderate to advanced liver fibrosis (consistent with stages F2 to F3 fibrosis), it has not been approved in any other jurisdiction for this indication or for any other indication.

In order to market Rezdiffra for other indications or in other jurisdictions, we must obtain regulatory approval for each of those indications and in each of the applicable jurisdictions, and we may never be able to obtain such approval.

While our MAA for resmetirom for the treatment of MASH with liver fibrosis has been validated and is now under evaluation with the CHMP, no guarantee can be made that we will receive requisite marketing approvals.

In order to market any products outside of the United States, we must establish and comply with numerous and varying regulatory requirements of other countries regarding clinical trial design, safety and efficacy.

In order to market any products outside of the United States and EU, we must establish and comply with numerous and varying regulatory requirements of other countries regarding clinical trial design, safety and efficacy.

Clinical trials conducted in one country may not be accepted by regulatory authorities in other countries, and regulatory approval in one country does not mean that regulatory approval will be obtained in any other country.

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In addition, our failure to obtain regulatory approval in any country may delay or have negative effects on the process for regulatory approval in other countries.

If we fail to comply with regulatory requirements in international markets or to obtain and maintain required approvals, our target market will be reduced and our ability to realize the full market potential of Rezdiffra will be harmed.

Governments outside the United States tend to impose strict price controls, which may adversely affect our revenues, if any.

If our products are approved in foreign jurisdictions, we will be subject to pricing and reimbursement policies in those jurisdictions.

In some countries, including countries in the EU, the pricing of prescription pharmaceuticals is subject to governmental control.

In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a drug.

To obtain reimbursement or pricing approval in some countries, governmental authorities adopt a number of different methodologies for assessing drug costs and reimbursement levels.

These include comparisons with currently available medicines for the same indication and/or cost effectiveness assessments as the basis for negotiation.

If reimbursement of our drugs is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business, and in particular our European expansion efforts, could be materially harmed.

If we fail to comply with regulatory requirements in international markets or to

obtain and maintain required approvals, our target market will be reduced and our ability to realize the full market potential of Rezdiffra will be harmed.

EU pricing and reimbursement regulations may materially affect our ability to market and receive coverage for Rezdiffra in the EU Member States.

Our ability to successfully commercialize Rezdiffra in the EU, which has received a CMA from the EC and which we have launched in Germany, will depend on the pricing and reimbursement terms we are able to secure and maintain in the EU Member States in which we plan to launch.

Pricing and reimbursement decisions are made at the Member State level in the EU and the policies, evidentiary requirements, and assessment methodologies governing drug pricing and reimbursement vary widely from country to country.

For example, an EU Member State may restrict the range of medicinal products for which their national health insurance systems provide reimbursement and may approve a specific price for the medicinal product, while others may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market.

Pricing negotiations with governmental authorities can take considerable time after receiving marketing authorization in the EU Member States and this may negatively impact our anticipated timelines for launch in key markets in the EU.

In addition, as we have received a CMA from the EC, it may be more difficult to obtain reimbursement approval in certain EU Member States and we may not be able to obtain a satisfactory price for Rezdiffra through the benefit and value assessments conducted by the Health Technology Assessment bodies in the EU Member States based on the clinical data that we have to date.

We may be required to provide additional evidence (including comparative effectiveness, real-world evidence, registries, or other post-launch commitments) before we can be granted reimbursement, or we may be required to seek reimbursement for a narrower sub-population than the authorized label in order to obtain commercially viable pricing and reimbursement terms.

If we are unable to secure reimbursement, if reimbursement is limited in scope or population, or if pricing is set at levels that are not commercially sustainable in any EU Member States, it may not be commercially viable for us to launch in such countries.

Even if we are able to launch in such countries, unsatisfactory pricing and reimbursement terms would impact our revenues from sales of Rezdiffra and the potential profitability of Rezdiffra in those countries would be negatively affected.

In particular, we may not be able to obtain pricing for Rezdiffra in the EU Member States which is similar to our intended price for the U.S.

If the FDA or other applicable regulatory authorities approve generic products that compete with Rezdiffra, the sales of Rezdiffra would be adversely affected.

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These manufacturers might only be required to conduct a relatively inexpensive study to show that their product has the same active ingredient(s), dosage form, strength, route of administration and conditions of use, or labeling, as our product and that the generic product is bioequivalent to our product, meaning it is absorbed in the body at the same rate and to the same extent as our product.

These generic equivalents, which must meet the same quality standards as branded pharmaceuticals, would

be significantly less costly than our product to bring to market, and companies that produce generic equivalents are generally able to offer their products at lower prices.

These generic equivalents, which must meet the same quality standards as branded pharmaceuticals, would be significantly less costly than our product to bring to market, and companies that produce generic equivalents are generally able to offer their products at lower prices.

Thus, after the introduction of a generic competitor, a significant percentage of the sales of any branded product are typically lost to the generic product.

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Rezdiffra is currently only available for distribution through a limited number of specialty pharmacies in the United States.

These specialty pharmacies account for all of our revenue.

These specialty pharmacies account for substantially all of our revenue in the U.S.

A specialty pharmacy is a pharmacy that specializes in the dispensing of medications for complex or chronic conditions that often require a high level of patient education and ongoing management.

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We face an inherent risk of product liability lawsuits related to the testing of any product candidates in human clinical trials and an even greater risk in connection with the commercialization of Rezdiffra.

Product liability claims may be brought against us or our partners by participants enrolled in our clinical trials, patients, healthcare providers or others

using, administering or selling any approved product.

Product liability claims may be brought against us or our partners by participants enrolled in our clinical trials, patients, healthcare providers or others using, administering or selling any approved product.

If we cannot successfully defend ourselves against any such claims, we may incur substantial liabilities.

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• submit for and receive regulatory approval to perform clinical trials;

• conduct appropriate preclinical and clinical trials, including confirmatory clinical trials, according to good laboratory practices and good clinical practices and disease-specific expectations of the FDA and other regulatory bodies;

• conduct appropriate preclinical and clinical trials, including confirmatory clinical trials, according to good laboratory practices and GCP and disease-specific expectations of the FDA and other regulatory bodies;

• select and recruit clinical investigators and subjects for our clinical trials;

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In addition, success in early clinical trials does not mean that later clinical trials will be successful, because later-stage clinical trials may be conducted in broader patient populations and involve different study designs.

Furthermore, our ongoing and future trials will need to demonstrate sufficient safety and efficacy in large

patient populations for approval by regulatory authorities.

Furthermore, our ongoing and future trials will need to demonstrate sufficient safety and efficacy in large patient populations for approval by regulatory authorities.

Companies frequently suffer significant setbacks in advanced clinical trials, even after earlier clinical trials have shown promising results, and we cannot be certain that we will not face similar setbacks.

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We cannot be certain that any of our ongoing or future clinical trials will be successful, and any safety concerns observed in any one of our clinical trials in our targeted indications could limit the prospects for regulatory approval of our product candidates in those and other indications.

Additionally, our clinical trials may utilize an “open-label” trial design.

An “open-label” clinical trial is one where both the patient and investigator know whether the patient is receiving the investigational product candidate or either an existing approved drug or placebo.

Most typically, open-label clinical trials test only the investigational product candidate and sometimes may do so at different dose levels.

Open-label clinical trials are subject to various limitations that may exaggerate any therapeutic effect as patients in open-label clinical trials are aware when they are receiving treatment.

Open-label clinical trials may be subject to a “patient bias” where patients perceive their symptoms to have improved merely due to their awareness of receiving an experimental treatment.

In addition, open-label clinical trials may be subject

to an “investigator bias” where those assessing and reviewing the physiological outcomes of the clinical trials are aware of which patients have received treatment and may interpret the information of the treated group more favorably given this knowledge.

The results from an open-label trial may not be predictive of future clinical trial results with any of our product candidates when studied in a controlled environment with a placebo or active control.

In addition, there are many other difficulties and uncertainties inherent in pharmaceutical research and development that could significantly delay or otherwise materially impair our ability to develop future product candidates, including the following:

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Failure to successfully develop future product candidates for any of these reasons may materially adversely affect our business, financial condition, results of operations and prospects and the value of our common stock.

If we fail to develop and commercialize other product candidates, we may be unable to grow our business.

We plan to evaluate the development and commercialization of therapies beyond Rezdiffra.

We may choose to in-license or acquire other product candidates as well as commercial products to treat patients suffering from disorders with high unmet medical needs and limited treatment options.

These other product candidates may require additional, time-consuming development efforts prior to commercial sale, including preclinical studies, clinical trials and approval by the FDA and/or applicable foreign regulatory authorities.

If we fail to successfully develop and commercialize our other product candidates, we may be unable to grow our business.

We plan to evaluate the development and commercialization of therapies beyond Rezdiffra, including MGL-2086, ervogastat and our siRNA programs.

We may choose to in-license or acquire additional product candidates to treat patients suffering from disorders with high unmet medical needs and limited treatment options.

These product candidates will require additional, time-consuming development efforts prior to commercial sale, including preclinical studies, clinical trials and approval by the FDA and/or applicable foreign regulatory authorities.

All product candidates are prone to the risks of failure that are inherent in pharmaceutical product development, including the possibility that the product candidate will not be shown to be sufficiently safe and effective for approval by regulatory authorities.

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We may also disclose interim data from our clinical trials.

Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient

data become available.

Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available.

Differences between preliminary or interim data and final data could significantly harm our business prospects.

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In addition, in regards to the information we publicly disclose regarding a particular study or clinical trial, such as topline data, others may not agree with what we determine is the material or otherwise appropriate information to include in such disclosure, and any information we determine not to disclose, or to disclose at a later date, such as at a medical meeting may ultimately be deemed significant with respect to future decisions, conclusions, views, activities, or otherwise regarding a particular drug, drug candidate, or our business.

If the topline data that we report differ from actual results or are interpreted differently once additional data are disclosed at a later date, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for and commercialize our drug candidates, our business, operating results, prospects, or financial condition may be harmed or our stock price may decline.

If the interim, topline or preliminary data that we report differ from actual results or are interpreted differently once additional data are disclosed at a later date, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for and commercialize our drug candidates, our business, operating results, prospects, or financial condition may be harmed or our stock price may decline.

If clinical trials or regulatory approval processes are prolonged, delayed or suspended, we may be unable to advance the development of or commercialize our product candidates on a timely basis, which would require us to incur additional costs and delay our receipt of any revenue from potential product sales.

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A number of events, including but are not limited to any of the following, could delay or impede completely the completion of our ongoing and planned clinical trials and negatively affect our ability to obtain regulatory approval for, and to market and sell, a particular product candidate:

• conditions imposed on us by the FDA or other regulatory authorities regarding the scope or design of our clinical trials;

• conditions imposed on us by the FDA, the EMA or other regulatory authorities regarding the scope or design of our clinical trials;

• insufficient supply of our product candidates or other materials necessary to conduct and complete our clinical trials;

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In addition, if our clinical trials are delayed, our competitors may be able to bring products to market before we do and the commercial viability of our product candidates could be limited.

If we inadvertently fail to comply with foreign regulatory requirements governing human clinical trials and marketing approval for drugs, we could be prevented from selling our drug candidates in foreign markets, which may adversely affect our operating results and financial condition.

If we inadvertently fail to comply with foreign regulatory requirements governing human clinical trials and marketing approval for drugs, we could be prevented from selling our drug candidates in such foreign markets, which may adversely affect our operating results and financial condition.

The requirements governing the conduct of clinical trials, product licensing, pricing, and reimbursement for marketing products outside the United States vary greatly from country to country and may require additional testing.

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Failure to comply with these regulatory requirements or obtain required approvals could impair our ability to develop foreign markets for our drug candidates and may have a material adverse effect on our results of operations and financial condition.

We may in the future conduct certain clinical trials for our product candidates outside of the U.S.

However, the FDA may not accept data from such trials, in which case our development plans will be delayed, which could materially harm our business.

We may conduct one or more of our clinical trials for our product candidates outside the U.S.

Although the FDA may accept data from clinical trials conducted outside the U.S., acceptance of this data is subject to certain conditions imposed by the FDA.

Where data from foreign clinical trials are intended to serve as the basis for marketing approval in the U.S., the FDA will not approve the application on the basis of foreign data alone unless those data are applicable to the U.S.

population and U.S.

medical practice;

the studies were performed by clinical investigators of recognized competence;

and the data are considered valid without the need for an on-site inspection by the FDA or, if the FDA considers such an inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means.

For studies that are conducted only at sites outside of the U.S.

and not subject to an IND, the FDA generally does not provide advance comment on the clinical protocols for the studies, and therefore there is an additional potential risk that the FDA could determine that the study design or protocol for a non-U.S.

clinical trial was inadequate, and require us to conduct additional clinical trials.

In addition, even where the foreign study data are not intended to serve as the sole basis for approval, the FDA will not accept the data as support for an application for marketing approval unless the study is well-designed and well-conducted in accordance with GCP and the FDA is able to validate the data from the study through an onsite inspection if deemed necessary.

There can be no assurance the FDA will accept data from clinical trials conducted outside off the U.S.

If the FDA does not accept data from our clinical trials of our product candidates, we would likely need to conduct additional clinical trials, which would be costly and time consuming and could delay or halt our development of our product candidates.

Additionally, recent policy proposals in the U.S., if enacted in the future, may make acceptance by the FDA or inclusion in a marketing application of foreign data more difficult or costly.

These and other risks associated with our potential international operations may materially adversely affect our ability to develop our product candidates and attain or maintain profitable operations, which could have a material adverse effect on our business and results of operations.

We depend on enrollment of patients in our clinical trials.

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If patients elect to discontinue participation in our clinical trials at a higher rate than expected, we may be unable to generate the data required by regulators for approval.

Enrollment delays in these clinical trials may result in increased development costs for our planned or future product candidates, which would cause the value of our Company to decline and limit our ability to obtain additional financing.

Breakthrough therapy or priority review by the FDA for any product candidate may not lead to faster development, regulatory review or approval processes, and it does not increase the likelihood that our product candidates will receive marketing approval.

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Sponsors of drugs that are breakthrough therapies may also be able to submit marketing applications on a rolling basis, meaning that the FDA may review portions of a marketing application before the sponsor submits the complete application to the FDA, if the sponsor pays the user fee upon submission of the first portion of the marketing application.

For applications that receive priority review, the FDA's marketing application review goal is shortened to six months, as opposed to ten months under standard review.

For applications that receive priority

review, the FDA’s marketing application review goal is shortened to six months, as opposed to ten months under standard review.

Designation as a breakthrough therapy or priority review product is within the discretion of the regulatory agency.

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Risks Related to our Business Operations, Employee Matters and Managing Growth

Our failure to successfully in-license, acquire, develop and market additional product candidates could impair our ability to grow our business.

As part of our business strategy, we may effect acquisitions or licenses to obtain additional product candidates, technologies, capabilities or personnel.

The success of this strategy depends partly upon our ability to identify and select promising pharmaceutical product candidates, negotiate licensing or acquisition agreements with their current owners and finance these arrangements.

The process of proposing, negotiating and implementing a license or acquisition of a product candidate is lengthy and complex.

Other companies, including some with substantially greater financial and other resources, may compete with us for the license or acquisition of product candidates.

Moreover, we may devote resources to potential acquisitions or licensing opportunities that are never completed, or we may fail to realize the anticipated benefits of such efforts.

Additionally, we may not be able to acquire the rights to additional product candidates on terms that we find acceptable, or at all.

Any strategic transactions we enter into may not be clinically or commercially successful, and may require financing or a significant amount of cash, which could adversely affect our business.

Entering into strategic transactions involves a number of operational risks, including:

• failure to achieve expected synergies;

• the possibility that our acquired technologies, products and product candidates may not be clinically or commercially successful;

• difficulty and expense of assimilating the operations, technology and personnel of any acquisition;

• the inability to maintain any acquired company’s relationship with key third parties, such as alliance partners;

• diversion of our management’s attention from our core business.

We also may enter into collaborative relationships that would involve our collaborators conducting proprietary development programs.

Disagreements with collaborators may develop over the rights to our intellectual property, and any conflict with our collaborators could limit our ability to obtain future collaboration agreements and negatively influence our relationship with existing collaborators.

If we make one or more significant acquisitions or enter into a significant collaboration in which the consideration includes cash, we may be required to use a substantial portion of our available cash or need to raise additional capital, which could adversely affect our financial condition.

We are dependent upon retaining and attracting key personnel, the loss of whose services could materially adversely affect our business, financial condition, results of operations, prospects and the value of our common stock.

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We expect to continue to expand our development and commercialization capabilities, and as a result, we may encounter challenges in managing our growth, which could disrupt our operations.

We are in the process of expanding our commercial operations in Europe for Rezdiffra, if approved, and are seeking to expand our development pipeline.

We are in the process of expanding our commercial operations in Europe for Rezdiffra and are seeking to continue to expand our development pipeline.

We expect to continue to experience growth in the number of our employees and the scope of our operations, particularly in the areas of drug development, regulatory affairs, quality, commercial compliance, medical affairs, and sales and marketing.

For example, we plan to hire additional personnel to support the commercialization of Rezdiffra in Europe, subject to requisite regulatory approvals.

To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel.

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We may not be able to effectively manage the expansion of our operations, which could delay the execution of our business plans or disrupt our operations.

Our failure to successfully in-license, acquire, develop and market additional product candidates or approved products could impair our ability to grow our business.

As part of our business strategy, we may effect acquisitions or licenses to obtain additional businesses, products, technologies, capabilities or personnel.

The process of proposing, negotiating and implementing a license or acquisition of a product candidate is lengthy and complex.

Other companies, including some with substantially greater financial and other resources, may compete with us for the license or acquisition of product candidates.

Moreover, we may devote resources to potential acquisitions or licensing opportunities that are never completed, or we may fail to realize the anticipated benefits of such efforts.

Additionally, we may not be able to acquire the rights to additional product candidates on terms that we find acceptable, or at all.

Any strategic transactions we enter into may not be clinically or commercially successful, and may require financing or a significant amount of cash, which could adversely affect our business.

Entering into strategic transactions involves a number of operational risks, including:

• failure to achieve expected synergies;

• the possibility that our acquired technologies, products and product candidates may not be clinically or commercially successful;

• difficulty and expense of assimilating the operations, technology and personnel of any acquisition;

• the inability to maintain any acquired company’s relationship with key third parties, such as alliance partners;

• diversion of our management’s attention from our core business.

We also may enter into collaborative relationships that would involve our collaborators conducting proprietary development programs.

We may enter into out-licenses or pursue collaborative relationships with entities in foreign jurisdictions outside of the United States and Europe.

We may enter into out-licenses or agreements to collaborate with partners outside the United States and Europe for the development and commercialization of Rezdiffra and any other future product candidate.

In order to access these markets, we may enter into licenses or other arrangements with third parties on terms that may be unfavorable to us.

These arrangements may involve us relinquishing control and certain other valuable rights, such as development rights and future revenue streams, related to our technologies.

These relationships may result in disagreements with our collaborators and partners which could delay development and commercialization activities and distract us from our ongoing business operations.

In addition, these relationships may subject us to certain risks related to intellectual property protection and enforcement.

Less strict enforcement of intellectual property rights in some jurisdictions outside of the in the United States and Europe may lead to difficulties enforcing contractual terms intended to protect intellectual property rights in such jurisdictions.

For this reason, if there are disputes with collaborators in certain jurisdictions over the interpretation of contractual provisions or with respect to rights to intellectual property developed as part of a collaboration program, we may not prevail and may therefore have less well-protected intellectual property rights than we would have foreseen in such jurisdiction.

Less well-protected intellectual property rights may leave us at a competitive disadvantage or more readily allow the marketing of competing products in foreign jurisdictions.

Unfavorable geopolitical conditions may subject us to further risks with respect to out-licenses or collaborations with partners outside the United States.

Geopolitical actions by the United States or foreign jurisdictions may result in new restrictions on our ability to out-license our technology to certain jurisdictions or engage in cross-border transfers.

Geopolitical conflicts could have an adverse impact on collaborators located in jurisdictions involved in such conflicts, which could in turn disrupt or otherwise adversely impact the development of collaboration programs.

Future geopolitical developments, including potential deterioration in bilateral relationships between the United States and other jurisdictions, could also have a negative impact on our ability to enter into or maintain agreements with collaborators located in certain jurisdictions outside of the United States.

We enter into various contracts in the normal course of our business in which we indemnify the other party to the contract.

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Should our obligation under an indemnification provision exceed applicable insurance coverage or if we are denied insurance coverage, our business, financial condition and results of operations could be adversely affected.

Similarly, if we are relying on a collaborator to indemnify us and the collaborator is denied insurance coverage or the

indemnification obligation exceeds the applicable insurance coverage, and if the collaborator does not have other assets available to indemnify us, our business, financial condition and results of operations could be adversely affected.

Similarly, if we are relying on a collaborator to indemnify us and the collaborator is denied insurance coverage or the indemnification obligation exceeds the applicable insurance coverage, and if the collaborator does not have other assets available to indemnify us, our business, financial condition and results of operations could be adversely affected.

Risks Related to Our Dependence on Third Parties

If the third parties on which we rely for the conduct of our clinical trials and results do not perform our clinical trial activities in accordance with GCP and related regulatory requirements, we may be unable to obtain regulatory approval for our product candidates or commercialize our products.

We use third-party service providers to conduct and oversee our clinical trials and expect to continue to do so for the foreseeable future.

If the third parties on which we rely for the conduct of our clinical trials and results do not perform our clinical trial activities in accordance with our agreements, GCP and related regulatory requirements, we may be unable to obtain regulatory approval for our product candidates or commercialize our products.

We use clinical research organizations ("CROs") and other third-party service providers to conduct and oversee our clinical trials and expect to continue to do so for the foreseeable future.

We rely heavily on these parties for successful execution of our clinical trials.

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Our reliance on third parties that we do not control does not relieve us of these responsibilities and requirements.

Third parties may not complete activities on schedule or may not conduct our clinical trials in accordance with regulatory or GCP requirements or the respective trial plans and protocols.

Third parties may not complete activities on schedule or may not conduct our clinical trials in accordance with regulatory or GCP requirements, our agreements or the respective trial plans and protocols.

In addition, third parties may not be able to repeat their past successes in clinical trials.

The failure of these third parties to carry out their obligations could delay or prevent the development and approval of our product candidates and commercialization of our products or result in enforcement action against us.

We also rely on third parties to select and enter into agreements with clinical investigators to conduct clinical trials to support approval of our product candidates.

The failure of these third parties to adequately carry out their obligations could delay or prevent the development and approval of our product candidates and commercialization of our products or result in enforcement action against us.

If our relationship with these third-party providers terminates, we may not be able to enter into arrangements with alternative providers or do so on commercially reasonable terms.

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We have relied on, and expect to continue to rely on, third-party manufacturers to produce Rezdiffra and any future product candidates.

We do not own or operate manufacturing facilities for the production of clinical or commercial quantities of Rezdiffra or any future product candidates, and we lack the resources and the capabilities to do so.

We do not own or operate manufacturing facilities for the production of clinical or commercial quantities of Rezdiffra or any product candidates, and we lack the resources and the capabilities to do so.

As a result, we currently rely, and expect to rely on third-party manufacturers to supply our product candidates for our clinical trials as well as our commercial supply of Rezdiffra.

Reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured our product candidates or products ourselves.

Reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured Rezdiffra or our product candidates ourselves.

For example, if we do not maintain our key manufacturing relationships, we may fail to find replacement manufacturers or develop our own manufacturing capabilities, which could negatively impact our commercial operations or delay or impair our ability to obtain regulatory approval for our product candidates and substantially increase our costs or deplete profit margins, if any.

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Any failure to comply with cGMP requirements or other FDA, EMA, or comparable foreign regulatory requirements could adversely affect our clinical research activities and our ability to develop our product candidates and market our products following approval, including Rezdiffra.

Our current and anticipated future dependence upon others for the manufacture of Rezdiffra and any future product candidate may adversely affect our future profit margins, if any, and our ability to develop our product candidates and commercialize any products that receive regulatory approval on a timely basis.

Our current and anticipated future dependence upon others for the manufacture of Rezdiffra and any product candidate may adversely affect our future profit margins, if any, and our ability to develop our product candidates and commercialize any products that receive regulatory approval on a timely basis.

If any third-party manufacturer of Rezdiffra or any other future product candidates is unable to increase the scale of its production of such product or product candidates or increase the product yield of its manufacturing, then our costs to manufacture such product or product candidate may increase and any commercialization may be delayed.

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In addition, if our third party manufacturers are not able to optimize their manufacturing processes to increase the product yield for Rezdiffra or any other future product candidates, or if they are unable to produce increased amounts of such product candidates while maintaining the quality of the product and compliance with cGMPs, then we may not be able to meet the demands of clinical trials or market demands, which could decrease our ability to generate profits and have a material adverse impact on our business and results of operation.

Using specialty distributors to market and sell Rezdiffra in certain jurisdictions outside of the United States subjects us to certain risks.

Outside of the United States, we may enter into distribution agreements with specialty distributors to commercialize Rezdiffra.

We may be unable to enter into appropriate supply, marketing, and distribution arrangements on favorable terms, if at all.

Our use of distributors in these markets to market and sell Rezdiffra involves certain risks, including, but not limited to, risks that these organizations will not comply with applicable laws and regulations, not effectively sell or support Rezdiffra or reduce or discontinue their efforts to sell or support Rezdiffra, not devote the resources necessary to market and sell Rezdiffra in the volumes and within the time frame we expect, not be able to satisfy financial obligations to us or others, not provide us with accurate or timely information regarding their inventories of Rezdiffra or the number of patients who are using Rezdiffra, or not provide us with accurate or timely information regarding serious adverse events and/or product complaints.

Any such events may result in regulatory actions that may include suspension or termination of the distribution and sale of Rezdiffra in a certain country, loss of revenue, and/or reputational damage, which could harm our results of operations and business.

Risks Related to Our Financial Position and Need for Capital

We have a limited operating history and currently only have one commercial product, Rezdiffra in the United States, which may make it difficult to evaluate the prospects for our future viability.

We are still in the relatively early stages of our transition from a clinical-stage to a commercial-stage company.

We have a limited operating history and currently only have one commercial product, Rezdiffra, which may make it difficult to evaluate the prospects for our future viability.

Our operations to date have been primarily limited to conducting research and development activities, including preclinical studies and clinical trials and, more recently, preparing for commercialization of and commercializing Rezdiffra.

We have not yet demonstrated an ability to generate significant revenues on a long term sustained basis, or to conduct sales and marketing activities necessary for successful longer term product commercialization.

We have not yet demonstrated an ability to generate revenues on a long term sustained basis, or to conduct sales and marketing activities necessary for successful longer term product commercialization.

Initial sales of Rezdiffra may not be predictive of long-term commercial results.

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As of December 31, 2025, we had cash, cash equivalents, restricted cash and marketable securities of approximately $988.6 million.

Despite our recent launch of Rezdiffra in the United States, we expect to continue to incur operating losses as we:

• support our sales and marketing efforts for Rezdiffra in the United States;

Despite our recent launch of Rezdiffra in the United States and Germany, we expect to continue to incur operating losses as we:

• support our sales and marketing efforts for Rezdiffra;

• fulfill our post-marketing commitments and clinical trials of Rezdiffra, as required by the FDA;

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We have a limited history of recognizing revenue from product sales and may not be able to achieve or maintain long-term sustainable profitability.

Our ability to generate revenue and achieve profitability depends on our ability to successfully obtain and maintain the regulatory approvals necessary to commercialize our products, including our commercialization of Rezdiffra in the United States.

Our ability to recognize revenues from product sales depends heavily on our success in:

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• attracting, hiring and retaining qualified personnel.

Other than Rezdiffra in the United States, we have not yet launched any other approved products for commercial sale.

We anticipate continuing to incur significant costs associated with seeking full approval of Rezdiffra in the United States and the commercialization of Rezdiffra, and even if another product candidate we may develop is approved for commercial sale, we anticipate incurring significant costs associated the commercialization of any such approved product candidate.

Even though we have begun to generate revenues from the sale of Rezdiffra, we may not be able to achieve or maintain long-term sustainable profitability unless Rezdiffra is fully approved in the United States and is approved in other jurisdictions or for additional indications or our future product candidates are approved.

Other than Rezdiffra, we have not yet launched any other approved products for commercial sale.

We anticipate continuing to incur significant costs associated with seeking full approval of Rezdiffra in the United States and European Union and the commercialization of Rezdiffra, and even if another product candidate we may develop is approved for commercial sale, we anticipate incurring significant costs associated the commercialization of any such approved product candidate.

Even though we generate revenues from the sale of Rezdiffra, we may not be able to achieve or maintain long-term sustainable profitability unless Rezdiffra is fully approved in the United States and European Union and is approved in other jurisdictions or for additional indications or our future product candidates are approved.

Because of the uncertainties and risks associated with these activities, we are unable to accurately and precisely predict the timing and amount of revenues, the extent of any future losses or if we might sustain profitability.

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The amount and timing of any expenditure needed to fund our operations will depend on numerous factors, including:

• the costs associated with commercializing Rezdiffra in the United States;

• the costs associated with commercializing Rezdiffra;

• the type, number, scope, progress, expansion costs, results of and timing of our ongoing and future clinical trials or the need for additional clinical trials;

• the costs of obtaining, maintaining and enforcing our patents and other intellectual property rights;

• the timing and costs of maintaining marketing approvals for Rezdiffra in the United States;

• our ability to receive marketing approval for Rezdiffra in Europe;

• the number of other product candidates that we may pursue and such product candidates' development requirements;

• the timing and costs of maintaining marketing approvals for Rezdiffra in the United States and European Union;

• the number of other product candidates that we may pursue and such product candidate’s development requirements;

• the timing of obtaining regulatory approval for any potential future product candidates;

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In any particular quarter or quarters, our operating results could be below the expectations of securities analysts or investors, which could cause our stock price to decline.

Our Loan and Security Agreement contains restrictive and financial covenants that may limit our operating flexibility.

On May 6, 2022, we and our subsidiary, Canticle Pharmaceuticals, Inc.

(“Canticle”) entered into a Loan and Security Agreement with Hercules Capital, Inc.

(“Hercules”), as amended on February 3, 2023 and August 22, 2024 (as amended, the “Loan Agreement”), providing for an aggregate of $250.0 million in term loans that will be available to us in four tranches subject to the conditions set forth in the Loan Agreement (collectively, the “Term Loans”).

Our obligations under the Loan Agreement are secured by a security interest in substantially all of our assets, other than intellectual property.

Until we have repaid such indebtedness, the Loan Agreement subjects us to various terms, conditions and covenants.

Our Financing Agreement contains restrictive and financial covenants that may limit our operating flexibility.

On July 17, 2025, we entered into a Financing Agreement with certain funds managed by Blue Owl Corporation as the lenders (the "Lenders") and LSI Financing LLC as the administrative agent (as amended, the "Financing Agreement").

Under the Financing Agreement, the Lenders have committed up to $500.0 million in senior secured credit facilities, consisting of (a) an initial term loan in an aggregate principal amount equal to $350.0 million (the “Initial Term Loan”) and (b) delayed draw term loan commitments in an aggregate principal amount not to exceed $150.0 million (the loans thereunder, if any, the “Delayed Draw Term Loans”).

In addition, the Financing Agreement includes an uncommitted incremental facility in an aggregate principal amount not to exceed $250.0 million (the loans thereunder, if any, the “Incremental Term Loans”, together with the Initial Term Loan and any Delayed Draw Term Loans, collectively the “Term Loans”), subject to the satisfaction of certain terms and conditions set forth in the Financing Agreement.

Our obligations under the Financing Agreement are secured by a security interest in substantially all of our assets.

Until we have repaid such indebtedness, the Financing Agreement subjects us to various terms, conditions and covenants.

These include 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.

Additionally, the Loan Agreement contains affirmative and restrictive financial covenants, 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 both a certain FDA approval for resmetirom and a revenue milestone (the “Minimum Cash Covenant”).

The Loan Agreement also includes a revenue-based covenant (the “Revenue Covenant”) that could apply commencing at or after the time that financial reporting became due for the quarter end September 30, 2024;

however, the Revenue Covenant will be automatically waived pursuant to the terms of the Loan Agreement at any time in which we maintain, as measured monthly, (i) a certain level of cash, cash equivalents and liquid funds relative to the debt outstanding under the Loan Agreement or (ii) a market capitalization of at least $1.2 billion.

Unless waived as a result of the foregoing, the Revenue Covenant requires the Company to achieve a minimum amount of trailing three-month net product revenue.

Additionally, the Financing Agreement contains affirmative and restrictive covenants, including maintenance of a minimum unrestricted cash balance of $100.0 million.

Our business may be adversely affected by these restrictions on our ability to operate our business.

If we raise any additional debt financing, as permitted by the Loan Agreement and if pursued and secured by the Company, the terms of such additional debt could further restrict our operating and financial flexibility.

We may not be able to generate sufficient cash flow or sales to meet the financial covenants or pay the principal and interest under the Term Loans.

If we raise any additional debt financing, as permitted by the Financing Agreement and if pursued and secured by the Company, the terms of such additional debt could further restrict our operating and financial flexibility.

We may not be able to generate sufficient cash flow or sales to pay the principal and interest under the Term Loans.

Furthermore, our future working capital, borrowings or equity financing could be unavailable to repay or refinance the amounts outstanding under the Term Loans.

In the event of a liquidation, Hercules would be repaid all outstanding principal and interest prior to distribution of assets to unsecured creditors, and the holders of our common stock would receive a portion of any liquidation proceeds only if all of our creditors then existing, including Hercules, were first repaid in full.

Our failure to comply with the covenants or other terms of the Loan Agreement, including as a result of events beyond our control, could result in a default under the Loan Agreement that could materially and adversely affect our business.

We may be required to repay the outstanding indebtedness under the Loan Agreement if an event of default occurs under the Loan Agreement or, if applicable, any future debt facility.

The Loan Agreement includes customary events of default, including payment defaults, breaches of covenants following any applicable cure period, the occurrence of certain events that could reasonably be expected to have a “material adverse effect” as set forth in the Loan Agreement and cross acceleration.

In the event of a liquidation, the Lenders would be repaid all outstanding principal and interest prior to distribution of assets to unsecured creditors, and the holders of our common stock would receive a portion of any liquidation proceeds only if all of our creditors then existing were first repaid in full.

Our failure to comply with the covenants or other terms of the Financing Agreement, including as a result of events beyond our control, could result in a default under the Financing Agreement that could materially and adversely affect our business.

We may be required to repay the outstanding indebtedness under the Financing Agreement if an event of default occurs under the Financing Agreement or, if applicable, any future debt facility.

We may not have enough available cash or be able to raise additional funds through equity or debt financings to repay such indebtedness at the time any such event of default occurs.

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Further, on February 10, 2021, the federal government’s support for overturning the ACA was withdrawn.

It is unclear how the Supreme Court ruling, other such litigation and the healthcare reform measures of the

Biden Administration will impact the ACA.

It is unclear how the Supreme Court ruling, other such litigation and the healthcare reform measures of the Biden Administration will impact the ACA.

It is difficult to predict the future legislative landscape in healthcare and the effect on our business, results of operations, financial condition and prospects.

Changes to the ACA, to the Medicare or Medicaid programs, or to the ability of the federal government to negotiate or otherwise affect drug prices, or other federal legislation regarding healthcare access, financing or legislation in individual states, could affect our business, financial condition, results of operations and prospects and the value of our common stock.

Changes to the ACA, to the Medicare or Medicaid programs, or to the ability of the federal government to negotiate or otherwise affect drug prices, or other federal

legislation regarding healthcare access, financing or legislation in individual states, could affect our business, financial condition, results of operations and prospects and the value of our common stock.

We may face similar challenges to gaining regulatory approval and sufficient reimbursement and pricing due to government healthcare reform in the EU, and other jurisdictions.

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If we fail to comply with our reporting and payment obligations under the Medicaid Drug Rebate program or other governmental pricing programs, we could be subject to additional rebate requirements, penalties, or other sanctions, which could have a material adverse effect on our business, financial condition, results of operations, and growth prospects.

A number of government pricing programs create certain price reporting obligations.

Under the Medicaid Drug Rebate program, a participating manufacturer is required to pay a rebate to each state Medicaid program for its covered outpatient drugs that are dispensed to Medicaid beneficiaries and paid for by the state Medicaid program as a condition of having federal funds being made available for drugs under Medicaid and Medicare Part B.

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These data include the average manufacturer price and, in the case of innovator products, the best price for each drug, which, in general, represents the lowest price available from the manufacturer to any wholesaler, retailer, provider, health maintenance organization, nonprofit entity, or governmental entity in the United States in any pricing structure, calculated to include all sales and associated rebates, discounts, and other price concessions.

See the section titled “Business—Government Regulation—Pharmaceutical Price Reporting” in this Annual Report for more information.

Those rebates are based on pricing data reported by the manufacturer on a monthly and quarterly basis to CMS.

If we fail to pay the required rebate amount or report pricing data on a timely basis, we may be subject to civil monetary penalties and/or termination from the Medicaid Drug Rebate program.

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CMS could also decide to terminate our Medicaid drug rebate agreement, in which case federal payments may not be available under Medicaid or Medicare Part B for our covered outpatient drugs.

See the section titled “Business—Government Regulation—Pharmaceutical Price Reporting” in this Annual Report for more information.

The ACA (addressed further above in the section titled “Business—Government Regulation—U.S.

Healthcare Reform”) made significant changes to the Medicaid Drug Rebate Program, and CMS issued a final regulation to implement the changes to the Medicaid Drug Rebate Program under the ACA.

CMS also issued a final regulation that modified prior Medicaid Drug Rebate Program regulations to permit reporting multiple best price figures with regard to value based purchasing arrangements;

and provide definitions for “line extension,” “new formulation,” and related terms, with the practical effect of expanding the scope of drugs considered to be line extensions that are subject to an alternative rebate formula.

Our failure to comply with these price reporting and rebate payment options, as well as pharmaceutical benefit manager “accumulator” programs, could negatively impact our financial results.

Federal law requires that a manufacturer also participate in the 340B Drug Pricing program in order for federal funds to be available for the manufacturer’s drugs under Medicaid and Medicare Part B.

If we are found to have knowingly and intentionally charged 340B covered entities more than the statutorily mandated ceiling price, we could be subject to significant civil monetary penalties and/or such failure also could be grounds for HRSA to terminate our agreement to participate in the 340B program, in which case our covered outpatient drugs would no longer be eligible for federal payment under the Medicaid or Medicare Part B program.

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They also may affect the 340B ceiling price and therefore liability under the 340B program.

Finally, in order to be eligible to have its products paid for with federal funds under the Medicaid and Medicare Part B programs and purchased by the Department of Veterans Affairs (“VA”), Department of Defense (“DoD”), Public Health Service, and Coast Guard (the “Big Four agencies”) and certain federal grantees, a manufacturer is required to participate in the VA Federal Supply Schedule (“FSS”) pricing program, established under Section 603 of the Veterans Health Care Act of 1992.

Under this program, the manufacturer is obligated to make its covered drugs available for procurement on an FSS contract and charge a price to the Big Four agencies that is no higher than the Federal Ceiling Price (“FCP”), which is a price calculated pursuant to a statutory formula.

The FCP is derived from a calculated price point called the “non-federal average manufacturer price” (“Non FAMP”), which the manufacturer calculates and reports to the VA on a quarterly and annual basis.

Pursuant to applicable law, knowing provision of false information in connection with a Non FAMP filing can subject a manufacturer to significant penalties for each item of false information.

The FSS contract also contains extensive disclosure and certification requirements.

Finally, in order to be eligible to have its products paid for with federal funds under the Medicaid and Medicare Part B programs and purchased by the Big Four Agencies and certain federal grantees, a manufacturer is required to participate in the VA FSS pricing program, established under Section 603 of the Veterans Health Care Act of 1992.

If we overcharge the government in connection with the FSS contract or Tricare Retail Pharmacy Rebate Program, whether due to a misstated FCP or otherwise, we will be required to refund the difference to the government.

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In addition to the federal government, some states, as well as other countries, including France, require the disclosure of certain payments to healthcare professionals.

The Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), state, and foreign privacy laws may limit access to information identifying those individuals who may be prospective users or limit the ability to market to them.

HIPAA, state, and foreign privacy laws may limit access to information identifying those individuals who may be prospective users or limit the ability to market to them.

Some of these laws are new or ambiguous as to what is required to comply with their requirements, and we could be subject to penalties if it is determined that we have failed to comply with an applicable legal requirement.

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If we are not in compliance with the FCPA and other anti-corruption laws or Trade Control Laws, we may be subject to criminal and civil penalties, disgorgement and other sanctions and remedial measures, and legal expenses, which could have an adverse impact on our business, financial condition, results of operations and prospects and the value of our common stock.

Likewise, even an investigation by US or foreign authorities of potential violations of the FCPA other anti-corruption laws or Trade Control laws could have an adverse impact on our reputation, business, financial condition, results of operations and prospects and the value of our common stock.

Likewise, even an investigation by US or foreign authorities of potential violations of the FCPA other anti-corruption laws or Trade Control Laws could have an

adverse impact on our reputation, business, financial condition, results of operations and prospects and the value of our common stock.

Disruptions at the FDA and other government agencies caused by the change in presidential administration, funding shortages or potential funding shortages could hinder their ability to hire and retain key leadership and other personnel, delay or prevent new products and services from being developed or commercialized in a timely manner, or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.

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ability to hire and retain key personnel and accept the payment of user fees;

and statutory, regulatory, and policy changes, including as a result of shifting policy priorities of the current presidential administration and political appointees tasked to oversee the agency, among other factors.

and statutory, regulatory, leadership and policy changes, including as a result of shifting policy priorities of the current presidential administration and political appointees tasked to oversee the agency, among other factors.

Average review times at the agency may fluctuate as a result.

For example, in 2025, changes and cuts in FDA staffing have been reported as resulting in delays in the FDA’s responsiveness or in its ability to review IND submissions or marketing applications.

In addition, government funding of other government agencies on which our operations may rely is subject to the political process, which is inherently fluid and unpredictable.

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government has shut down multiple times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA and other government employees and stop critical activities.

Currently, federal agencies in the United States are operating under a continuing resolution that is set to expire on March 14, 2025.

Without appropriation of additional funding to federal agencies, our business operations related to our product development activities for the U.S.

The FDA is currently funded through September 30, 2026.

Without appropriation of necessary funding to federal agencies, our business operations related to our product development activities for the U.S.

market could be impacted.

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HIPAA imposes privacy and security obligations on covered entity health care providers, health plans, and health care clearinghouses, as well as their “business associates” – certain persons or covered entities that create, receive, maintain, or transmit protected health information in connection with providing a specified service or performing a function on behalf of a covered entity.

We could potentially be subject to criminal penalties if we, our affiliates, or our agents knowingly receive individually identifiable health information maintained by a HIPAA-covered entity in a manner

that is not authorized or permitted by HIPAA.

Failing to take appropriate steps to keep consumers’ personal information secure may also constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act (the “FTCA”), 15 U.S.C § 45(a).

The FTC expects a company’s data security measures to be reasonable and appropriate in light of the sensitivity and volume of consumer information it holds, the size and complexity of its business and the cost of available tools to improve security and reduce vulnerabilities.

Further, certain state laws govern the privacy and security of personal information.

Regulators and legislators in the U.S.

are also increasingly scrutinizing and restricting certain personal data transfers and transactions involving foreign countries.

For example, the Department of Justice’s January 28, 2025 rule on "Preventing Access to U.S.

Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons" prohibits data brokerage transactions involving certain sensitive personal data categories, including health data, genetic data, and biospecimens, to countries of concern, including China.

The regulations also restrict certain investment agreements, employment agreements and vendor agreements involving such data and countries of concern, absent specified cybersecurity controls.

Actual or alleged violations of these regulations may be punishable by criminal and/or civil sanctions and may result in exclusion from participation in federal and state programs.

Further, 20 U.S.

states have implemented comprehensive laws which govern the privacy and security of personal information.

For example, to the extent we collect California resident personal information, we may also be subject to the CCPA.

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These claims may result in significant liability and damages.

Similar laws have been passed in numerous other states.

Other states have proposed new privacy laws which, if enacted, may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment of resources in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.

Similar laws have been passed in numerous other states, adding additional

complexity, variation in requirements, restrictions and potential legal risk, requiring additional investment of resources in compliance programs.

The implementation of these laws may impact our strategies and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.

These laws and regulations are evolving and may impose limitations on our business activities.

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In addition, other states have proposed and/or passed legislation that regulates the privacy and/or security of certain specific types of information.

For example, a small number of states have passed laws that regulate biometric data specifically.

For example, a small number of states, including Texas and Illinois, have passed laws that regulate biometric data specifically.

These various privacy and security laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products.

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European data collection is governed by restrictive regulations governing the use, processing and cross-border transfer of personal information.

Outside the United States, our clinical trial programs and operations implicate international data protection laws, including the EU General Data Protection Regulation including as implemented in the UK (collectively, “GDPR”).

Outside the United States, our clinical trial programs and operations implicate international data protection laws, including the EU General Data Protection Regulation (“EU GDPR”) including the EU GDPR in such form as implemented into the laws of the UK (“UK GDPR”, collectively with EU GDPR, “GDPR”).

The GDPR increases our responsibility and liability in relation to the processing of personal data of individuals located in the EU.

The GDPR, together with the national legislation of the EU member states governing the processing of personal data, places certain obligations on the processing of such personal data including ensuring the lawfulness of processing personal data, health data and samples from clinical trials and adverse event reporting.

In particular, these obligations and restrictions concern the consent of the individuals to whom the personal data relates where applicable, the processing details disclosed to the individuals, the sharing of personal data with third parties, the transfer of personal data out of the EU, security breach notifications, as well as substantial potential fines for violations of the data protection obligations.

Specifically regarding the transfer of personal data outside of the EU, while there are legal mechanisms available to

lawfully transfer personal data outside of the EU, including to the United States, there are certain unsettled legal issues regarding such data transfers, the resolution of which may adversely affect our ability to transfer personal data or otherwise may cause us to incur significant costs to come into compliance with applicable data transfer impact assessments and implementation of legal data transfer mechanisms.

On July 16, 2020, the European Court of Justice ruled the EU-U.S.

Privacy Shield to be an invalid data transfer mechanism and confirmed that the Model Clauses remain valid, and in June 2021, the EC published updated versions of the Model Clauses, which must be incorporated into new and existing agreements within prescribed timeframes in order to continue to lawfully transfer personal data outside of the EU.

Data protection authorities from the different European member states, as well as in the UK and Switzerland, have promulgated national privacy laws that impose additional requirements, which add to the complexity of processing and transferring EU personal data, with the UK and Switzerland following the EU with the publication of new Model Clauses to be incorporated in all applicable contracts within a specified timeframe in order to legitimize data transfers from those jurisdictions.

The UK adopted versions of their Model Clauses during 2022.

The GDPR, together with the national legislation of the EU member states governing the processing of personal data, places numerous obligations on companies, including requirements relating to processing health and other sensitive data, where required obtaining consent of the individuals to whom the personal data relates, having legal bases or conditions for processing, requiring disclosures to individuals regarding data processing activities, requiring that safeguards are implemented to protect the security and confidentiality of personal data, responding to individuals’ requests to exercise their rights, limiting retention periods for personal data, creating mandatory data breach notification requirements in certain circumstances, requiring that certain measures (including contractual requirements) are put in place when engaging third-party processors, appointing data protection officers, conducting data protection impact assessments, ensuring certain accountability measures are in place and record keeping.

Companies that fail to comply with the GDPR may face temporary or definitive bans on data processing and other corrective actions;

fines of up to €20 million under the EU GDPR, or £17.5 million under the UK GDPR, or 4% of annual global revenue, whichever is greater;

or private litigation related to processing of personal data brought by classes of data subjects or consumer protection organizations authorized at law to represent their interests.

Although the UK is regarded as a third country under the EU GDPR, the EC has now issued a decision recognizing the UK as providing adequate protection under the EU GDPR and, therefore, transfers of personal data originating in the EU to the UK remain unrestricted.

In December 2025, the EC adopted a decision to extend the validity of the UK adequacy decision for six years until December 2031, determining that the UK continues to offer a level of data protection that is “essentially equivalent” to the EU standards.

This follows the UK’s adoption of the Data (Use and Access) Act 2025 (the “DUAA”) in June 2025.

The respective provisions and enforcement of the EU GDPR and UK GDPR may further diverge in the future and create additional regulatory challenges and uncertainties.

This lack of clarity on future UK laws and regulations and their interaction with EU laws and regulations could add legal risk, complexity and

cost to our handling of personal data and our privacy and data security compliance programs and could require us to implement different compliance measures for the UK and the EEA.

Like the EU GDPR, the UK GDPR restricts personal data transfers outside the UK to countries not regarded by the UK as providing adequate protection.

The UK government has confirmed that personal data transfers from the UK to the EEA remain free flowing.

Specifically regarding the transfer of personal data outside of the EU and UK, adequate safeguards must be implemented in compliance with EU and UK data protection laws.

There are currently various mechanisms that may be used to transfer personal data from the EEA and UK to the United States in compliance with law, such as the EEA’s standard contractual clauses, the UK’s International Data Transfer Agreement / Addendum, and the EU-U.S.

Data Privacy Framework (“Framework”) and the UK extension thereto (which allows for transfers to relevant U.S.-based organizations who self-certify compliance and participate in the Framework).

When relying on certain mechanisms, such as the EEA’s standard contractual clauses, companies are required to conduct transfer impact assessments.

Our ability to continue to transfer personal data outside of the EU, the UK or Switzerland may become significantly more expensive and may subject us to increased scrutiny and liability under the GDPR or similar local laws, and we may experience operating disruptions if we are unable to conduct these transfers in the future.

On December, 13 2022, the EC adopted a draft adequacy decision for the EU-U.S.

Data Privacy Framework, which reflects the assessment by the EC of the U.S.

legal framework.

The draft decision concludes that the United States ensures an adequate level of protection for personal data transferred from the EU to U.S.

After an approval process, the EC is expected to adopt the final adequacy decision, which will allow data to flow freely from the EU to the United States between companies certified under the new framework.

Risks associated with operations outside of the United States could adversely affect our business.

A key component of our strategy is to expand our commercialization of Rezdiffra to Europe, pending the receipt of requisite regulatory approvals.

Following the receipt of a CMA by the EC, we launched Rezdiffra in Germany in September 2025.

International operations and business expansion plans are subject to numerous additional risks, including:

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Our commercial success depends in part on our ability to obtain and maintain patent and/or trade secret protection for our product, product candidates, proprietary technologies, and their uses, as well as our ability to freely operate without infringing upon the proprietary rights of others.

we provide any assurance that the patents issued will not be infringed, designed around or invalidated by third parties.

We can provide no assurance that our patent applications or those of our licensors will result in additional patents being issued or that issued patents will afford sufficient protection against competitors with similar technologies, nor can we provide any assurance that the patents issued will not be infringed, designed around or invalidated by third parties.

Even issued patents may later be found unenforceable or may be modified or revoked in proceedings instituted by third parties before various patent offices or in courts.

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This failure to properly protect the intellectual property rights relating to our product or product candidates could have a material adverse effect on our financial condition and results of operations.

While we have licensed rights to issued patents in the United States and other jurisdictions for resmetirom and its use, we cannot be certain that the claims in issued patents will not be found invalid or unenforceable if challenged.

While we own patents and have licensed rights to issued patents in the United States and other jurisdictions for resmetirom and its use, we cannot be certain

that the claims in issued patents will not be found invalid or unenforceable if challenged.

We cannot be certain that the claims in owned and licensed patent applications covering our product and product candidates will be considered patentable by the United States Patent and Trademark Office (“USPTO”) and valid by courts in the United States or by the patent offices and courts in foreign jurisdictions.

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Our co-owned patents and pending patent applications that cover our particular solid form, dosage, method of manufacturing, and uses of resmetirom to treat various indications are scheduled to expire in 2033.

Our exclusively-owned pending patent applications that cover companion diagnostics, various solid forms of resmetirom, combination therapy, method of use, and method of manufacturing, if issued, are expected to expire between 2037 and 2044.

Our exclusively-owned pending patent application that covers other THR-β analogs and uses thereof, if issued, is expected to expire in 2043.

Our patent directed to Rezdiffra's commercial weight-threshold dosing regimen is scheduled to expire in the United States in 2045.

Our pending patent applications that cover various solid forms of resmetirom, combination therapy, method of use, and method of manufacturing, if issued, are expected to expire between 2037 and 2045.

While patent term adjustments or patent term extensions could result in later expiration dates for each of these patents, there can be no assurances that we will receive any patent adjustments or patent term extensions.

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If any of these events occurs or if we otherwise lose protection for our trade secrets or proprietary know-how, our business may be harmed.

Our rights to develop and commercialize our product are subject in part to the terms and conditions of a license to resmetirom granted to us by Roche.

Our rights to develop and commercialize resmetirom are subject in part to the terms and conditions of the Roche Agreement.

Pursuant to the terms of the Roche Agreement, we assumed control of all development and commercialization of resmetirom and hold exclusive worldwide rights for all potential indications.

Under the Roche Agreement, Roche exclusively licensed certain patent rights and know-how relating to resmetirom in exchange for consideration consisting of an upfront payment, milestone payments tied to the achievement of product development and regulatory milestones, and royalty payments based on net sales of products containing resmetirom, including Rezdiffra, or another licensed product, subject to certain reductions.

The Roche Agreement will expire, unless earlier terminated pursuant to other provisions thereof, on the last to occur of (i) the expiration of the last valid claim of a licensed patent covering the manufacture, use or sale of products containing resmetirom, or (ii) ten years after the first sale of a product containing resmetirom.

Under the Roche Agreement, Roche controls prosecution of the licensed patent rights, although we have a right to comment.

Pursuant to the Roche Agreement, our obligation to pay Roche royalties in a given country will expire on the last to occur of (i) the expiration of the last valid claim of a licensed patent covering the manufacture, use or sale of products containing resmetirom in a given country, or (ii) ten years after the first sale of a product containing resmetirom in such country.

We do not have, nor have we had, any material disputes with Roche regarding the Roche Agreement.

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Any uncured, material breach under the Roche Agreement could result in our loss of exclusive rights to resmetirom and may lead to a complete termination of the Roche Agreement and force us to cease product development efforts for resmetirom.

We may fail to comply with any of our obligations under agreements pursuant to which we license rights or technology, which could result in the loss of rights or technology that are material to our business.

We may enter into license agreements from time to time.

We may fail to comply with any of our obligations under agreements pursuant to which we license rights or technology, which could result in the loss of rights or technology that may be material to our business.

We have entered into license agreements for MGL-2086, ervogastat and our siRNA programs, and may enter into additional license agreements in the future.

Licensing of intellectual property is important to our business and involves complex legal, business and scientific issues.

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Although no third party has asserted a claim of patent infringement against us as of the filing date of this report, others may hold proprietary rights that could prevent resmetirom or our other product candidates from being marketed.

Any patent-related legal action against us claiming damages and seeking to enjoin commercial activities relating to our product and product candidates or processes could subject us to potential liability for damages and require us to obtain a license to continue to manufacture or market resmetirom or our other product candidates.

Any patent-related legal action against us claiming damages and seeking to enjoin commercial activities relating to our

product and product candidates or processes could subject us to potential liability for damages and require us to obtain a license to continue to manufacture or market resmetirom or our other product candidates.

We cannot predict whether we would prevail in any such actions or that any license required under any of these patents would be made available on commercially acceptable terms, if at all.

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For example, our product or product candidates may require specific formulations to work effectively and efficiently and the rights to these formulations may be held by others.

We may be unable to acquire or in-license any compositions, methods of use, processes, or other third party intellectual property rights from third parties that we identify as necessary for our product or product candidates.

We may be unable to acquire or in-license any compositions, methods of use, processes, or other third party intellectual property rights from third parties that

we identify as necessary for our product or product candidates.

The licensing and acquisition of third party intellectual property rights is a competitive area, and a number of more established companies are also pursuing strategies to license or acquire third party intellectual property rights that we may consider attractive.

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In addition, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names.

Over the long term, if we are unable to establish name recognition

based on our trademarks and trade names, then we may not be able to compete effectively and our business may be adversely affected.

Over the long term, if we are unable to establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively and our business may be adversely affected.

Our efforts to enforce or protect our proprietary rights related to trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources and could adversely impact our financial condition or results of operations.

We may not be able to protect our intellectual property rights throughout the world.

While we have licensed from Roche issued patents directed at resmetirom in the United States and other countries, filing, prosecuting and defending patents on resmetirom in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States can be less extensive than those in the United States.

While we have licensed from Roche issued patents directed at resmetirom, and have filed our own patent applications and have obtained our own issued patents, in the United States and other countries, filing, prosecuting and

defending patents on resmetirom in all countries throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the United States can be less extensive than those in the United States.

In addition, the laws of some foreign countries may not protect intellectual property rights to the same extent as federal and state laws in the United States.

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In the event any of the foregoing occur, the market price of our common stock could be highly volatile and may materially decline.

A small number of our stockholders beneficially own a substantial amount of our outstanding common stock and may be deemed to have substantial control over us;

therefore, your ability to influence corporate matters may be limited.

Our officers and directors and certain stockholders affiliated and associated with our officers and directors collectively beneficially own approximately 34.6% of our outstanding common stock as of December 31, 2024 and, acting together, may have the ability to substantially affect matters submitted to our stockholders for approval, as well as our management and affairs.

This concentration of ownership may have the effect of delaying, deferring or preventing a strategic transaction, even if such a transaction would benefit other stockholders.

stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management, which may depress the trading price of our common stock.

Anti-takeover provisions in our restated certificate of incorporation (our “Charter”), our Restated Bylaws (our “Bylaws”) and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management, which may depress the trading price of our common stock.

Provisions in our Charter and Bylaws may delay or prevent a merger, acquisition or other change of control that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares.

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Although we believe these provisions together provide for an opportunity to receive higher bids by requiring potential acquirers to negotiate with our board of directors, such provisions would apply even if the offer may be considered beneficial by some stockholders.

These and other provisions in our Charter and Bylaws and under Delaware law could make it more difficult for stockholders or potential acquirors to obtain control of our board of directors or initiate actions that are opposed by our then-current board of directors, and could delay or impede a merger, tender offer or proxy

contest involving our company.

These and other provisions in our charter and bylaws and under Delaware law could make it more difficult for stockholders or potential acquirors to obtain control of our board of directors or initiate actions that are opposed by our then-current board of directors, and could delay or impede a merger, tender offer or proxy contest involving our company.

The existence of these provisions could negatively affect the price of our common stock and limit opportunities for you to realize value in a corporate transaction.

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This exclusive forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that such stockholder finds favorable for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees.

If a court were to find such exclusive forum provision to be inapplicable or unenforceable in an action, we may incur further significant additional costs associated with resolving the dispute in other jurisdictions, which could seriously harm our business.

If a court were to find such exclusive forum provision

to be inapplicable or unenforceable in an action, we may incur further significant additional costs associated with resolving the dispute in other jurisdictions, which could seriously harm our business.

Future sales and issuances of our common stock or rights to purchase common stock could result in additional dilution of the percentage ownership of our stockholders and could cause our share price to fall.

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Advisors LP hold a significant portion of our total outstanding shares of common stock (including shares of our common stock issuable upon conversion of shares of our Series A Convertible Preferred Stock and Series B Convertible Preferred Stock and pre-funded warrants), and any sale of such shares into the market, or a perception that such sales could occur, in the future could cause the market price of our common stock to drop significantly.

Based on a Schedule 13D/A filed with the SEC on March 25, 2024, 667, L.P.

Based on a Schedule 13D/A filed with the SEC on March 25, 2024 and subsequent filings with the SEC, 667, L.P.

and Baker Brothers Life Sciences, L.P., funds affiliated with Baker Bros.

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The Series A Convertible Preferred Stock beneficial ownership limitation may be increased or decreased to any other percentage provided that any such increase or decrease will not be effective until the 61st day after such notice is provided to us (the “Beneficial Ownership Limitations”).

The 7,050,177 total shares also includes 2,705,790 pre-funded warrants.

The 7,219,498 total shares also include 2,705,790 pre-funded warrants.

Without such limitations on conversion or exercise, Baker Bros.

total ownership would represent 26% of our total outstanding shares of common stock as of December 31, 2024 on a fully exercised or as-converted to common stock basis.

The pre-funded warrants are only exercisable to the extent that, after giving effect to such exercise, the holders thereof,

together with their affiliates and any members of a Section 13(d) group with such holders, would beneficially own, for purposes of Rule 13d-3 under the Exchange Act, no more than 9.99% of the outstanding shares of our common stock (the “Maximum Percentage”).

total ownership would represent approximately 26% of our total outstanding shares of common stock as of December 31, 2025 on a fully exercised or as-converted to common stock basis.

The pre-funded warrants are only exercisable to the extent that, after giving effect to such exercise, the holders thereof, together with their affiliates and any members of a Section 13(d) group with such holders, would beneficially own, for purposes of Rule 13d-3 under the Exchange Act, no more than 9.99% of the outstanding shares of our common stock (the “Maximum Percentage”).

By written notice to us, holders of the pre-funded warrants may from time to time increase or decrease the Maximum Percentage to any other percentage not in excess of 19.99%.

Any such increase in the Maximum Percentage will not be effective until the 61st day after such notice is provided to us.

In addition, the 7,219,498 total shares includes 6,220 shares underlying vested restricted stock units and 2,210 shares underlying vested stock options granted to representatives of Baker Bros.

that serve on our Board of Directors.

Sales of a substantial number of shares of our common stock in the public market by Baker Bros., or the perception that these sales might occur, could depress the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities.

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As of December 31, 2025, there were a number of investors or investor groups that held a significant beneficial ownership interest in our common stock.

Based on a Schedule 13D/A filed on December 12, 2025 by each of Dr.

Paul Friedman, a member of our board of directors, and Dr.

Rebecca Taub, a member of our board of directors and our Chief Medical Officer and President of Research and Development, collectively beneficially own 2,107,078 shares (9.2%) of our common stock (the “Friedman/Taub Holdings”).

Based on a Schedule 13D/A filed with the SEC on March 25, 2024, funds affiliated with Baker Bros.

Rebecca Taub, a member of our board of directors and our former

Chief Medical Officer and President of Research and Development, they collectively beneficially own 1,814,831 shares (7.8%) of our common stock (the “Friedman/Taub Holdings”).

Based on a Schedule 13D/A filed with the SEC on March 25, 2024 and subsequent SEC filings, funds affiliated with Baker Bros.

Advisors LP beneficially owned (for SEC reporting purposes) 9.99% of our common stock and maintained an ownership interest in up to 7,219,498 shares of our common stock subject to exercise or conversion limits such as the Beneficial Ownership Limitation and the Maximum Percentage (the “Baker Bros.

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In addition, as of December 31, 2025, there are:

2,263,222 shares of our common stock issuable upon the exercise of outstanding stock options or the vesting of restricted stock units and performance stock units (assuming the maximum outcome of the performance conditions) under our 2015 Stock Plan, as amended, and 2023 Inducement Plan;

pre-funded warrants to purchase shares of common stock pursuant to outstanding pre-funded warrants as described above and 19,454 shares of our common stock issuable upon the exercise of outstanding vested warrants held by our creditors consisting of Hercules and affiliates.

In addition, there are other institutional investors (including funds affiliated with Janus Henderson Group plc, which reported beneficial ownership of 2,208,394 shares of our common stock (10.1%) in a Schedule 13G/A filed with the SEC on February 14, 2025) who from time to time file Schedule 13Gs (or amendments thereto) or Form 13Fs reflecting substantial beneficial ownership of our outstanding common stock.

2,034,771 shares of our common stock issuable upon the exercise of outstanding stock options or the vesting of restricted stock units and performance stock units (assuming the maximum outcome of the performance conditions) under our 2015 Stock Plan, as amended, 2023 Inducement Plan and 2025 Inducement Plan;

("Hercules") and affiliates.

In addition, there are other institutional investors (including funds affiliated with Janus Henderson Group plc, which reported beneficial ownership of 1,842,690 shares of our common stock (8.3%) in a Schedule 13G/A filed with the SEC on November 14, 2025) who from time to time file Schedule 13Gs (or amendments thereto) or Form 13Fs reflecting substantial beneficial ownership of our outstanding common stock.

Sales of a substantial number of shares of our common stock by one or more of the investors or groups listed above or other equity-related securities in the public markets could depress the market price of our common stock and impair our ability to raise capital.

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A failure of our information technology infrastructure and cybersecurity threats may adversely affect our business and operations.

Our information technology infrastructure is subject to threats from computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures.

Our information technology infrastructure is subject to threats from cybersecurity incidents, data breaches, computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures.

In addition, the information technology systems of our current or future third-party collaborators, service providers, contractors and consultants are subject to similar threats, and we depend in part on third-party security measures over which we do not have full control to protect against data security incidents.

Attacks on information technology systems are increasing in their frequency, levels of persistence, sophistication and intensity, and such attacks are being conducted by increasingly sophisticated and organized groups and individuals with a wide range of motives and expertise.

Like other companies in our industry, we have experienced and will likely continue to experience, threats and cybersecurity incidents relating to our data, information technology systems and infrastructure, and the systems of our third-party vendors.

In addition to extracting information (which could be sensitive), such as trade secrets or other intellectual property, such attacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means, including ransom demands, to affect service reliability and/or threaten the confidentiality, integrity and availability of information.

Such an event could result in a material disruption of our operations or development programs and/or produce significant reputational, financial, legal, regulatory, business or operational harm.

Attempts to disrupt or gain unauthorized access to our and our third-party vendors’ information systems from malicious third parties or insider threats may incorporate widely varying and frequently changing tactics, which may be enhanced or facilitated by artificial intelligence.

In addition to extracting information (which could be sensitive), such as trade secrets or other intellectual property, such attacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, wrongful or accidental conduct by employees or vendors, and social engineering (including phishing attacks) to affect service reliability and/or threaten the confidentiality, integrity and availability of information.

A cybersecurity incident, data breach or other adverse event could result in a material disruption of our operations or development programs and/or produce significant reputational, financial, legal, regulatory, business or operational harm.

For example, any loss of clinical trial data could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.

To the extent that any incident, disruption or security breach results in a loss of or damage to our data or applications or other data or applications relating to our technology, product or product candidates, or inappropriate disclosure of confidential or proprietary information, we could incur liabilities and the further development of and regulatory approval efforts for our product candidates or commercialization of our product could be delayed.

We have been subject to cybersecurity attacks in the past that have impacted our systems and data.

Although we have taken steps to enhance our cybersecurity protections and minimize the impact of any future event, we cannot provide any assurances that future cyber events will not occur, that these security safeguards will be successful, and that future cyber events, to the extent they occur, will not impact our operations or have any material adverse impact on our business.

As a result, we may not in the future successfully prevent service interruptions, exfiltrations or data security incidents that could materially adversely affect our business.

In addition, insurance may not cover or be sufficient in type or amount to cover us against claims related to cyber incidents.

Any failure or perceived failure by us or any third-party collaborators, service providers, contractors or consultants to comply with our privacy, confidentiality, data security or similar obligations to third parties, or any data security incidents or other security breaches that result in the unauthorized access, release or transfer of sensitive information, including personally identifiable information, may result in:

governmental investigations, litigation, regulatory enforcement actions, fines, sanctions or other penalties, injunctive relief requiring costly compliance measures, required

notification and credit monitoring, public statements against us, third parties to lose trust in us, or claims by third parties asserting that we have breached our privacy, confidentiality, data security or similar obligations, any of which could have a material adverse effect on our reputation, business, financial condition or results of operations.

Moreover, data security incidents and other cybersecurity attacks can be difficult to detect, and any delay in identifying such threats or attacks may lead to increased harm.

To the extent that any cybersecurity incident, disruption or data breach results in a loss of or damage to our data or applications or other data or applications relating to our technology, product or product candidates, or inappropriate disclosure of confidential, personal or proprietary information, we could incur liabilities and the further development of and regulatory approval efforts for our product candidates or commercialization of our product could be delayed.

Like other companies in our industry, we, and our third party vendors, have experienced threats and cybersecurity incidents related to our data, information technology systems and infrastructure, and the systems of our third-party vendors.

Although we have taken steps to enhance our cybersecurity protections and minimize the impact of any future events, we cannot provide any assurances that these security safeguards will be successful, and that future cybersecurity incidents, data breaches or other adverse events will not occur, and to the extent they occur, that such events will not impact our operations or have any material adverse impact on our business.

Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our privacy and data security obligations.

In addition, although we maintain cyber liability insurance, this insurance may not cover or be sufficient in type or amount to cover us against claims related to cybersecurity incidents or data breaches.

Any failure or perceived failure by us or the third-party collaborators, service providers or consultants whom we rely to comply with our privacy, confidentiality, data security or similar obligations may result in:

governmental investigations, litigation, claims, regulatory enforcement actions, fines, sanctions or other penalties, injunctive relief requiring costly compliance measures, required notification and credit monitoring, public statements against us, or third parties to lose trust in us, any of which could have a material adverse effect on our reputation, business, financial condition or results of operations.

Our use of new and evolving technologies, such as artificial intelligence, may present risks and challenges that can impact our business, including by posing cybersecurity and other risks to our confidential and/or proprietary information, including personal information, and as a result we may be exposed to reputational harm and liability.

We may use and integrate artificial intelligence into our business processes both in our own development and implementation of models and through the adoption of commercially available tools.

Use of this technology presents risks and challenges that could affect our business.

Use of this technology could pose cybersecurity, data privacy, IT, intellectual property, regulatory, legal, operational, competitive, reputational and other risks and challenges that could affect our business.

Specifically, risks related to bias, AI hallucinations, discrimination, harmful content, misinformation, fraud, scams, targeted attacks such as model poisoning or data poisoning, surveillance, data

leakage, loss of consensus reality, inequality, environmental harms, and other harms may flow from our development, use, or deployment of AI technologies.

The rapid evolution of artificial intelligence will require the application of significant resources to design, develop, test and maintain processes to help ensure that artificial intelligence is implemented in accordance with applicable law and regulation and in a socially responsible manner and to minimize any real or perceived unintended harmful impacts.

The development of artificial intelligence models requires resources for design, development, testing and maintenance.

We must also endeavor to implement artificial intelligence in accordance with applicable law and regulation, in a socially responsible manner and to minimize any real or perceived unintended harmful impacts.

If we enable or use models that contain actual or perceived biases, we may experience brand or reputational harm, competitive harm or legal liability.

In addition, the use of artificial intelligence technologies can give rise to intellectual property risks, including by disclosing or otherwise compromising our confidential or proprietary intellectual property, or by undermining our ability to assert or defend ownership rights in intellectual property created with the assistance of artificial intelligence tools.

If we enable or use models that contain actual or perceived biases, or otherwise draw controversy due to perceived or actual negative societal impact, we may experience brand or reputational harm, competitive harm or legal liability.

In addition, the use of artificial intelligence technologies can give rise to intellectual property risks, including the disclosure or compromise of our confidential information or other proprietary intellectual property through the use of generative AI tools, or the ability to assert or defend ownership rights in intellectual property created with the use of generative artificial intelligence tools.

Further, we expect to see increasing government and supranational regulation related to artificial intelligence use and ethics, which may also significantly increase the burden and cost of research, development and compliance in this area.

For example, the EU’s Artificial Intelligence Act (“AI Act”) originally entered into force on August 1, 2024, and is expected to undergo amendments as introduced in the EU’s November 2025 Digital Omnibus on AI.

As enacted, the AI Act imposes significant obligations on providers and deployers of high-risk artificial intelligence systems, and encourages providers and deployers of artificial intelligence systems to account for EU ethical principles in their development and use of these systems.

The scope of requirements depends on judicial interpretations and forthcoming legislative amendments, and non-compliance can lead to significant fines.

Likewise, in the U.S., the regulatory environment is complex and uncertain.

President Trump’s Executive Order "Ensuring a National Policy Framework for Artificial Intelligence," effective December 11, 2025, directed federal agency reviews of state AI laws and coordination between White House advisors and Congress to reach a legislative proposal for a uniform federal AI policy framework.

At the same time, several states, including Colorado and California, passed laws that regulate various facets of AI, some of which have taken effect and will continue to take effect through 2026 and beyond.

These laws address a wide range of AI-related topics, including consequential decisions, transparency, training data, among others, and it remains unclear which requirements, if any, will be superseded by the Executive Order.

So far, these efforts have not been successful in curtailing state action on AI regulation, contributing to a complicated legislative patchwork, which may be litigated in state and federal courts.

Various federal and state regulators have also issued guidance and focused enforcement efforts on the use of AI in regulated sectors.

The FDA, for example, issued guidance on the use of artificial intelligence in medical devices, requiring detailed risk management and review processes to obtain approvals.

If we develop or use AI systems that are governed by the these laws or regulations, we will need to meet higher standards of data quality, transparency, and human oversight, and we would need to adhere to specific and potentially burdensome and costly ethical, accountability, and administrative requirements.

We may also be subject to significant enforcement or litigation in the event of any perceived non-compliance.

Our vendors may in turn incorporate artificial intelligence tools into their offerings, and the providers of these artificial intelligence tools may not meet existing or rapidly evolving regulatory or industry standards, including with respect to privacy and data security.

Further, bad actors around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in illegal activities involving the theft and misuse of personal information, confidential information and intellectual property.

In addition, the use of generative AI models in our internal or third-party systems may create new attack surfaces or methods for adversaries, which could impact us and our vendors.

The integration of AI systems, by us or by our vendors, may increase cybersecurity risk.

Any of these effects could damage our reputation, result in the loss of valuable property and information, cause us to breach applicable laws and regulations, and adversely impact our business.

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The rules governing the standards that must be met for management and our independent registered public accounting firm to assess our internal control over financial reporting are complex and require significant documentation, testing and possible remediation.

In connection with our and our independent registered public accounting firm’s evaluations of our internal control over financial reporting, we may need to upgrade systems, including information technology, implement additional financial and management controls, reporting systems and procedures and hire additional accounting and finance staff.

In connection with our and our independent registered public accounting firm’s evaluations of our internal control over financial reporting, we may need to upgrade systems, including information

technology, implement additional financial and management controls, reporting systems and procedures and hire additional accounting and finance staff.

Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our reporting obligations.

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Similar rules may apply under state tax laws.

We have not performed a detailed analysis to determine whether an ownership change under Section 382 of the Code, or similar state provisions, has previously occurred.

We experienced a Section 382 ownership change during the year ended December 31, 2017 which imposes annual limitations on our use of pre-change NOL carryforwards and other pre-change tax attributes.

We have determined that our research and development credit carryforwards are also limited.

We may also experience ownership changes in the future as a result of future transactions in our stock (some of which are outside our control).

In addition, we file U.S.

federal income tax returns and income tax returns in various state, local, and foreign jurisdictions and we are routinely subject to examination by taxing authorities in those jurisdictions.

Tax years beginning in 2021 remain open to examination by the Internal Revenue Service (“IRS”), state, and foreign taxing authorities.

To the extent that we have tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon IRS, state, or foreign tax authorities’ examination to the extent utilized in a future period.

Furthermore, our ability to utilize NOLs of companies that we may acquire in the future may be subject to limitations.

There is also a risk that due to regulatory changes, such as suspensions on the use of NOLs or other unforeseen reasons, our existing NOLs could expire or otherwise be unavailable to reduce future income tax liabilities, including for state tax purposes.

As a result, if we earn net taxable income, our ability to use the NOLs reflected on our balance sheet to offset U.S.

As a result, if we earn net taxable income, our ability to use the NOLs and tax credits reflected on our balance sheet to offset U.S.

federal taxable income may become subject to limitations, which could adversely affect our operating results and financial condition.

Taxing authorities could challenge our historical and future tax positions or our allocation of taxable income among our subsidiaries and we may incur additional tax liabilities.

We operate through various subsidiaries in a number of countries throughout the world.

Consequently, we are subject to tax laws, treaties, and regulations in the countries in which we operate, and these laws and treaties are subject to interpretation.

We have taken, and will continue to take, tax positions based on our interpretation of such tax laws.

Our transfer pricing arrangements are not generally binding on applicable tax authorities.

The price charged for products, services, or the royalty rates and other amounts paid for intellectual property rights, could be challenged by the various tax authorities, resulting in additional tax liability, interest, and/or penalties.

There can be no assurance that a taxing authority will not have a different interpretation of applicable law and assess us with additional taxes.

If we are assessed with additional taxes, this may result in a material adverse effect on our results of operations and/or financial condition.

Changes in tax law could adversely affect our business and financial condition.

The rules dealing with U.S.

federal, state and local income taxation are constantly under review by persons involved in the legislative process and by the U.S.

Internal Revenue Service and the U.S.

Treasury Department.

federal, state, local and international income taxation are constantly under review by persons involved in the legislative process and by the U.S.

Internal Revenue Service, the U.S.

Treasury Department and international tax authorities.

Changes to tax laws (which changes may have retroactive application) could adversely affect the Company or holders of our common stock.

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It cannot be predicted whether, when, in what form or with what effective dates tax laws, regulations and rulings may be enacted, promulgated or issued, which could result in an increase in our tax liability or the tax liability of holders of our common stock or require changes in the manner in which we operate in order to minimize or mitigate any adverse effects of changes in tax law.

Tax laws related to U.S.

federal, state and local and international income taxation are constantly under review by persons involved in the legislative process and by the Internal Revenue Service and the U.S.

Treasury Department.

Changes to tax laws (which may have retroactive application) could adversely affect us or holders of our common stock.

In recent years, many such changes have been made and changes are likely to continue to occur in the future.

Future changes in tax laws could have a material adverse effect on our business, cash flow, financial condition or results of operations.

We urge investors to consult with their legal and tax advisers regarding the implications of potential changes in tax laws on an investment in our common stock.

Volatility in foreign currency exchange rates could have a material adverse effect on our operating results.

As we expand our operations into Europe, we are exposed to risks related to changes in foreign currency exchange rates, primarily between the U.S.

dollar, euro and Swiss franc.

As we endeavor to expand our presence in international markets, to the extent we are required to enter into agreements denominated in a currency other than the U.S.

dollar, results of operations and cash flows may increasingly be subject to fluctuations due to changes in foreign currency exchange rates and may be adversely affected in the future due to changes in foreign currency exchange rates.

To date, we have not entered into any hedging arrangements with respect to foreign currency risk.

As our international operations grow, we will continue to reassess our approach to manage our risk relating to fluctuations in currency rates.

In addition, the current presidential administration has enacted or proposed to enact certain economic and trade policies, including with respect to tariffs, that could impact the global economy and further increase the volatility of foreign exchange rates.

Any future volatility in foreign exchange rates is likely to impact our operating results and financial condition.

Business disruptions could seriously harm our operations, future revenues and financial condition and increase our costs and expenses.

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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 1A. Risk Factors