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If mavodelpar is not successfully developed and approved in the United States or Europe, we may never generate any revenue.
−Removed: For the three months ended March 31, 2023 and 2022, we reported a net loss of $15.1 million and $13.0 million, respectively.
−Removed: As of March 31, 2023, we had an accumulated deficit of $151.8 million.
+Added: For the six months ended June 30, 2023 and 2022, we reported a net loss of $34.6 million and $25.3 million, respectively.
+Added: As of June 30, 2023, we had an accumulated deficit of $171.3 million.
We expect to continue to incur significant losses for the foreseeable future, and we expect these losses to increase as we continue our clinical development of, and seek regulatory approvals for, mavodelpar and any future product candidates.
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Because of the numerous risks and uncertainties associated with drug development, we are unable to accurately predict the timing or amount of increased expenses, or when, if at all, we will be able to achieve profitability.
−Removed: The uncertainties around our ability to obtain additional funding raise substantial doubt regarding our ability to continue as a going concern for a period of twelve months following the date that these consolidated financial
−Removed: statements were issued.
+Added: The uncertainties around our ability to obtain additional funding raise substantial doubt regarding our ability to continue as a going concern for a period of twelve months following the date that these consolidated financial statements were issued.
See Note 1 of Notes to Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for a detailed discussion.
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We will require significant additional amounts of capital in order to prepare for commercialization, and, if approved, to launch and commercialize mavodelpar.
−Removed: As of March 31, 2023, we had cash, cash equivalents and short-term investments of $93.8 million.
−Removed: Based on our current operating plan, we believe that our cash, cash equivalents and short-term investments as of March 31, 2023, together with the proceeds from our May 2023 public offering and our May 2023 private placement (discussed below), will enable us to fund our operating expenses and capital expenditure requirements through our planned near-term clinical milestones but not for more than one year after the date of the filing of this Quarterly Report on Form 10-Q.
+Added: As of June 30, 2023, we had cash, cash equivalents and short-term investments of $142.7 million.
+Added: Based on our current operating plan, we believe that our cash, cash equivalents and short-term investments as of June 30, 2023, will be sufficient to fund operations beyond the potential submission of a new drug application for mavodelpar for treatment of PMM in the United States anticipated in the first half of 2024.
However, changing circumstances may cause us to consume capital significantly faster than we currently anticipate, and we may need to spend more money than currently expected because of circumstances beyond our control.
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Additional funds may not be available to us on acceptable terms or at all.
+Added: In April 2023, we entered into a non-binding term sheet for a structured royalty financing of up to $100.0 million in conditional tranched funding, but ultimately determined not to pursue the transaction contemplated by the term sheet.
In May 2022, we entered into the ATM facility with SVB Securities LLC under which we may offer and sell, from time to time, at our sole discretion, up to $20.0 million in shares of our common stock.
−Removed: As of March 31, 2023, the remaining capacity under the ATM facility was approximately $18.8 million in shares of common stock.
+Added: As of June 30, 2023, the remaining capacity under the ATM facility was approximately $18.8 million in shares of common stock.
In May 2023, we completed a public offering in which we sold an aggregate of 7,906,250 shares of common stock, which included the full exercise of the underwriters’
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Total net proceeds from this offering, after deducting underwriting discounts and commissions and offering expenses, were approximately $58.9 million.
−Removed: Also, in May 2023, we completed a concurrent private placement in which we sold an aggregate of 625,000 shares of common stock to Abingworth, a holder of more than 5% of our common stock, at a price of $8.00 per share.
−Removed: Total net proceeds from this private placement, after deducting advisor fees and other estimated fees and expenses, were approximately $4.7 million.
−Removed: Our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and disruptions to, and volatility in, the credit and financial markets in the United States and worldwide, including those resulting from the COVID-19 pandemic or other infectious diseases, bank failures, actual or perceived changes in interest rates and economic inflation.
+Added: Also, in May 2023, we completed the Private Placement in which we sold an aggregate of 625,000 shares of common stock to Abingworth, a holder of more than 5% of our common stock, at a price of $8.00 per share.
+Added: Total net proceeds from the Private Placement, after deducting advisor fees and other estimated fees and expenses, were approximately $4.7 million.
+Added: Our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and disruptions to, and volatility in, the credit and financial markets in the United States and worldwide, including those resulting from infectious diseases, bank failures, actual or perceived changes in interest rates and economic inflation.
If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we may have to significantly delay, scale back, or discontinue the development or commercialization of mavodelpar or other research and development initiatives.
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Any safety concerns observed in any one of our clinical trials in our targeted indications could limit the prospects for regulatory approval of mavodelpar in those and other indications, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
−Removed: Further, if patients drop out of our clinical trials, miss scheduled doses or follow-up visits, or otherwise fail to follow clinical trial protocols, whether as a result of the COVID-19 pandemic or otherwise, the integrity of data from our clinical trials may be compromised or not accepted by the FDA, EMA or other regulatory authorities, which would represent a significant setback for the applicable program.
+Added: Further, if patients drop out of our clinical trials, miss scheduled doses or follow-up visits, or otherwise fail to follow clinical trial protocols, the integrity of data from our clinical trials may be compromised or not accepted by the FDA, EMA or other regulatory authorities, which would represent a significant setback for the applicable program.
If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected.*
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In addition, we rely on CROs and clinical trial sites to ensure proper and timely conduct of our clinical trials and, while we have agreements governing their services, we will have limited influence over their actual performance.
−Removed: We are unable to predict with confidence the likelihood or duration of such patient enrollment delays and difficulties, whether related to COVID-19 or otherwise.
+Added: We are unable to predict with confidence the likelihood or duration of such patient enrollment delays and difficulties.
If patient enrollment is delayed for an extended period of time, our clinical trials could be delayed or otherwise adversely affected.
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third-party contractors becoming debarred or suspended or otherwise penalized by the FDA or other government or regulatory authorities for violations of regulatory requirements, in which case we may need to find a substitute contractor, and we may not be able to use some or all of the data produced by such contractors in support of our marketing applications.
−Removed: In addition, disruptions caused by the COVID-19 pandemic may increase the likelihood that we encounter such difficulties or delays in initiating, enrolling, conducting, or completing our planned and ongoing clinical trials.
−Removed: For example, our Phase 1b study of mavodelpar in patients with PMM was closed early as a result of the COVID-19 pandemic.
−Removed: We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs or ECs of the institutions in which such trials are being conducted or by the FDA or comparable foreign regulatory authorities.
+Added: We could encounter delays if a clinical trial is suspended or terminated by us, by the IRBs or ECs of the institutions in which such trials are being conducted or by the FDA or comparable foreign regulatory authorities.
Such authorities may impose such a suspension or termination due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or comparable foreign regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial.
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Moreover, principal investigators for our clinical trials may serve and have served as scientific advisors or consultants to us from time to time and receive compensation in connection with such services.
−Removed: Under certain circumstances, we may be required to report some of these relationships to the FDA or comparable foreign regulatory authorities.
+Added: Under certain
+Added: circumstances, we may be required to report some of these relationships to the FDA or comparable foreign regulatory authorities.
The FDA or comparable foreign regulatory authority may conclude that a financial relationship between us and a principal investigator has created a conflict of interest or otherwise affected interpretation of the trial.
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Any delay in obtaining, or inability to obtain, applicable regulatory approval would delay or prevent commercialization of that product candidate and would materially adversely impact our business and prospects.
−Removed: Our business has been and could continue to be adversely affected by the COVID-19 global pandemic in regions where we or third parties on which we rely have significant manufacturing facilities, concentrations of clinical trial sites or other business operations.
+Added: Our business has been and could continue to be adversely affected by the COVID-19 pandemic in regions where we or third parties on which we rely have significant manufacturing facilities, clinical trial sites or other business operations.
The COVID-19 pandemic could adversely affect our operations, as well as the business or operations of our manufacturers, CROs, or other third parties with whom we conduct business.*
−Removed: Our business has been and could continue to be adversely affected by the COVID-19 pandemic, which was declared by the World Health Organization as a global pandemic, and we may experience ongoing disruptions that could severely impact our business and clinical trials.
+Added: Our business has been and could continue to be adversely affected by the COVID-19 pandemic and we may experience ongoing disruptions that could severely impact our business and clinical trials.
Our clinical trials have been, and may in the future be, affected by the COVID-19 pandemic.
For example, as a result of the COVID-19 pandemic, our Phase 1b study of mavodelpar in patients with PMM was closed early and we temporarily paused enrollment in our other Phase 1b studies.
−Removed: Additionally, the COVID-19 pandemic may impact patient enrollment in all of our ongoing clinical trials.
−Removed: In particular, some sites may pause enrollment to focus on, and direct resources to, COVID-19, while at other sites, patients may choose not to enroll or continue participating in the clinical trial as a result of the pandemic.
−Removed: In addition, patient visits to our clinical trial sites in the United States, Europe, Australia, New Zealand, and Canada at some point in the past or currently have slowed as a result of the COVID-19 pandemic.
−Removed: Further, according to the Centers for Disease Control and Prevention and the National Health Service in the UK, people who have serious chronic medical conditions, including those such as genetic mitochondrial diseases, are at higher risk of getting very sick from COVID-19.
−Removed: As a result, current or potential patients in our ongoing and planned clinical trials may choose to not enroll, not participate in follow-up clinical visits, or drop out of the trial as a precaution against contracting COVID-19.
−Removed: Further, some patients may not be able or willing to comply with clinical trial protocols if quarantines impede patient movement or interrupt healthcare services.
+Added: In particular, we have and could continue to
+Added: experience slowdown of patient enrollment and patient scheduled visits in all of our ongoing and future clinical trials.
If patient enrollment is delayed for an extended period of time, our ongoing and planned clinical trials could be delayed or otherwise adversely affected.
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These events could delay our clinical trials, increase the cost of completing our clinical trials, and negatively impact the integrity, reliability, or robustness of the data from our clinical trials.
+Added: We cannot predict future disruptions to the company which may occur due to COVID-19.
+Added: We continue to monitor the status of COVID-19 and will adjust our strategy accordingly in order to mitigate the impact on our business operations.
Preliminary, interim and topline data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.
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In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities or otherwise regarding a particular product, product candidate, or our business.
−Removed: If the interim, topline, or preliminary data that we report differ from actual results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for, and
−Removed: commercialize, mavodelpar and any future product candidates may be harmed, which could harm our business, operating results, prospects, or financial condition.
+Added: If the interim, topline, or preliminary data that we report differ from actual results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for, and commercialize, mavodelpar and any future product candidates may be harmed, which could harm our business, operating results, prospects, or financial condition.
If the market opportunities for mavodelpar and any future product candidates are smaller than we believe they are, or we face substantial competition in our markets, our future revenue may be adversely affected, and our business may suffer.
If the size of the market opportunities in each of our target indications for mavodelpar and any future product candidates is smaller than we anticipate, we may not be able to achieve profitability and growth.
−Removed: We focus our clinical development of mavodelpar on therapies for adult patients with genetic mitochondrial diseases with relatively small patient populations.
+Added: We focus our clinical development of mavodelpar on therapies for adult patients with genetic mitochondrial diseases with
+Added: relatively small patient populations.
Given the relatively small number of patients who have the diseases that we are targeting and intend to target with mavodelpar, it is critical to our ability to grow and become profitable that we continue to successfully identify patients with these rare genetic mitochondrial diseases.
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Identifying, selecting and acquiring promising product candidates requires substantial technical, financial, and human resources expertise.
−Removed: Efforts to do so may not result in the actual
−Removed: acquisition or license of a particular product candidate, potentially resulting in a diversion of our management’s time and the expenditure of our resources with no resulting benefit.
+Added: Efforts to do so may not result in the actual acquisition or license of a particular product candidate, potentially resulting in a diversion of our management’s time and the expenditure of our resources with no resulting benefit.
For example, if we are unable to identify programs that ultimately result in approved products, we may spend material amounts of our capital and other resources evaluating, acquiring and developing products that ultimately do not provide a return on our investment.
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If we receive regulatory approval for mavodelpar and any future product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense, and we may be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with any product.
−Removed: Any regulatory approvals that we receive may be subject to limitations on the approved indicated uses for which the product may be marketed or to the conditions of approval, or contain requirements for potentially costly post-marketing testing, including post-market studies or clinical trials, and surveillance to monitor safety and effectiveness.
+Added: Any regulatory approvals that we receive may be subject to limitations on the approved indicated uses for which the product may be marketed or to the conditions of approval, or contain requirements for potentially costly post-marketing testing, including post-market studies or clinical trials, and surveillance to monitor safety and
+Added: effectiveness.
The FDA may also require us to adopt a REMS to ensure that the benefits of treatment with such product candidate outweigh the risks for each potential patient, which may include, among other things, a communication plan to health care practitioners, patient education, extensive patient monitoring, or distribution systems and processes that are highly controlled, restrictive and more costly than what is typical for the industry.
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Congress, and the public.
−Removed: Additionally, advertising and promotion of any product candidate that obtains approval outside of the United States will be heavily scrutinized by comparable foreign entities and
−Removed: stakeholders.
+Added: Additionally, advertising and promotion of any product candidate that obtains approval outside of the United States will be heavily scrutinized by comparable foreign entities and stakeholders.
Violations, including actual or alleged promotion of our products for unapproved or off-label uses, are subject to enforcement letters, inquiries, and investigations, and civil and criminal sanctions by the FDA, DOJ, or comparable foreign bodies.
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The FDA’s and other regulatory authorities’
−Removed: policies may change, and additional government regulations may be enacted that could prevent, limit or delay regulatory approval for mavodelpar and any future product candidates.
+Added: policies may change, and additional government regulations may be enacted that could prevent, limit or delay regulatory approval for mavodelpar and any future product
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition, and results of operations.
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Patients who are prescribed medicine for the treatment of their conditions generally rely on third-party payors to reimburse all or part of the costs associated with their prescription drugs.
−Removed: Coverage and adequate reimbursement from governmental healthcare programs, such as Medicare and Medicaid, and commercial payors is critical to new product acceptance, and we may not
−Removed: obtain such coverage or adequate reimbursement.
+Added: Coverage and adequate reimbursement from governmental healthcare programs, such as Medicare and Medicaid, and commercial payors is critical to new product acceptance, and we may not obtain such coverage or adequate reimbursement.
Moreover, we focus our clinical development of mavodelpar on therapies for patients with genetic mitochondrial diseases with relatively small patient populations.
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In these countries, pricing negotiations with governmental authorities can take considerable time after obtaining marketing approval for a drug candidate and in some countries, products cannot be marketed until after such a price has been agreed.
−Removed: In addition, market acceptance and sales of a product will depend significantly on the availability of coverage and adequate
−Removed: reimbursement from third-party payors for a product and may be affected by existing and future health care reform measures.
+Added: In addition, market acceptance and sales of a product will depend significantly on the availability of coverage and adequate reimbursement from third-party payors for a product and may be affected by existing and future health care reform measures.
Recently enacted legislation, future legislation and healthcare reform measures may increase the difficulty and cost for us to obtain marketing approval for and commercialize mavodelpar and any future product candidates and may affect the prices we may set.*
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Further, there has been heightened governmental scrutiny in the United States of pharmaceutical pricing practices in light of the rising cost of prescription drugs.
−Removed: Such scrutiny has resulted in several recent congressional inquiries, presidential executive orders and proposed and enacted federal and state legislation designed to, among
−Removed: other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products.
+Added: Such scrutiny has resulted in several recent congressional inquiries, presidential executive orders and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products.
At the federal level, in July 2021, the Biden administration released an executive order, “Promoting Competition in the American Economy,”
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In response to Biden’s executive order, on September 9, 2021, HHS released a Comprehensive Plan for Addressing High Drug Prices that outlines principles for drug pricing reform and sets out a variety of potential legislative policies that Congress could pursue as well as potential administrative actions HHS can take to advance these principles.
−Removed: In addition, the IRA, among other things, (1) directs HHS to negotiate the price of certain high-cost, single-source drugs and biologics covered under Medicare and (2) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.
+Added: addition, the IRA, among other things, (1) directs HHS to negotiate the price of certain high-cost, single-source drugs and biologics covered under Medicare and (2) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.
The IRA permits HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.
−Removed: These provisions will take effect progressively starting in fiscal year 2023, although they may be subject to legal challenges.
+Added: These provisions will take effect progressively starting in fiscal year 2023, although the Medicare drug price negotiation program is currently subject to legal challenges.
HHS has and will continue to issue and update guidance as these programs are implemented.
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A medicinal product may be designated as orphan if (1) it is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition;
−Removed: (2) either (a) such condition affects no more than five in 10,000 persons in the EU when the application is made, or (b) the product, without the benefits derived from orphan status, would not
−Removed: generate sufficient return in the EU to justify investment;
+Added: (2) either (a) such condition affects no more than five in 10,000 persons in the EU when the application is made, or (b) the product, without the benefits derived from orphan status, would not generate sufficient return in the EU to justify investment;
and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU, or if such a method exists, the product will be of significant benefit to those affected by the condition.
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Another drug may receive marketing approval prior to mavodelpar.
−Removed: The applicable period is seven years in the United States and ten years in the EU, which may be extended by six months and two years, respectively, in the case of product candidates that have complied with the respective regulatory agency’s agreed upon pediatric investigation plan.
+Added: The applicable period is seven years in the United States and ten years in the EU, which may be extended by six months and two years, respectively, in the case of product candidates that have complied with the
+Added: respective regulatory agency’s agreed upon pediatric investigation plan.
The exclusivity period in the EU can be reduced to six years if, at the end of the fifth year, it is established that a drug no longer meets the criteria for orphan drug designation or if the drug is sufficiently profitable so that market exclusivity is no longer justified.
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If we license products or businesses, we may not be able to realize the benefit of such transactions if we are unable to successfully integrate them with our existing operations and company culture.
−Removed: Following a strategic transaction or license, we may not achieve the revenues or cash flows that justifies such transaction.
+Added: Following a strategic transaction or license, we may not achieve the revenues or cash flows that justifies
+Added: such transaction.
Any delays in entering into new strategic partnership agreements related to mavodelpar could delay the development and commercialization of mavodelpar in certain geographies for certain indications, which would harm our business prospects, financial condition, and results of operations.
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The loss of the services of any of our executive officers or other key employees and our inability to find suitable replacements could potentially harm our business, prospects, financial condition or results of operations.
−Removed: We conduct our operations in Irvine, California and Sandwich, United Kingdom as well as remotely as a hybrid office/virtual organization.
+Added: We conduct our operations in Irvine, California and Sandwich, United Kingdom (UK) as well as remotely as a hybrid office/virtual organization.
These regions serve as the headquarters to many other biotechnology and pharmaceutical companies and academic and research institutions.
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We will need to grow the size of our organization, and we may experience difficulties in managing this growth.*
−Removed: As of March 31, 2023, we had 48 employees.
+Added: As of June 30, 2023, we had 51 employees.
As our development and commercialization plans and strategies develop, we expect to need additional development, managerial, operational, financial, sales, marketing, and other personnel.
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Activities subject to these laws also involve the improper use of information obtained in the course of patient recruitment for clinical trials.
−Removed: If we obtain regulatory approval for mavodelpar and begin commercializing those products in the United States, the EU and other countries or jurisdictions, our potential exposure under the laws of such countries and
−Removed: jurisdictions will increase significantly, and our costs associated with compliance with such laws are also likely to increase.
+Added: If we obtain regulatory approval for mavodelpar and begin commercializing those products in the United States, the EU and other countries or jurisdictions, our potential exposure under the laws of such countries and jurisdictions will increase significantly, and our costs associated with compliance with such laws are also likely to increase.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of significant civil, criminal and administrative penalties, damages, disgorgement, monetary fines, imprisonment, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs and equivalent foreign healthcare programs, additional reporting requirements and/or oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, contractual damages, reputational harm, diminished profits and future earnings, and curtailment of our operations.
−Removed: Our relationships with customers, healthcare providers, and third-party payors may be subject, directly or indirectly, to federal, state and comparable foreign healthcare fraud and abuse laws, false claims laws, and other healthcare laws and regulations.
+Added: Our relationships with customers, healthcare providers, and third-party payors may be subject, directly or indirectly, to federal, state and comparable foreign healthcare fraud and abuse laws, false claims laws, and
+Added: other healthcare laws and regulations.
If we or our employees, independent contractors, consultants, commercial partners, or vendors violate these laws, we could face substantial penalties.
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In addition, the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal civil False Claims Act and the civil monetary penalties statute;
−Removed: the federal Health Insurance Portability and Accountability Act of 1996 (HIPAA) which created new federal civil and criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, including private third-party payors and knowingly and willfully falsifying, concealing or covering up by any trick, scheme or device, a material fact or making any materially false, fictitious or fraudulent statements in connection with the delivery
−Removed: of, or payment for, healthcare benefits, items or services.
+Added: the federal Health Insurance Portability and Accountability Act of 1996 (HIPAA) which created new federal civil and criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, including private third-party payors and knowingly and willfully falsifying, concealing or covering up by any trick, scheme or device, a material fact or making any materially false, fictitious or fraudulent statements in connection with the delivery of, or payment for, healthcare benefits, items or services.
Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;
HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, and their respective implementing regulations, which impose requirements on certain healthcare providers, health plans, and healthcare clearinghouses, known as covered entities, and their respective business associates that perform services for them that involve the use, or disclosure of, individually identifiable health information as well as their covered subcontractors;
−Removed: the federal Physician Payments Sunshine Act, which requires certain manufacturers of drugs, devices, biologicals and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to CMS information related to payments or other transfers of value made to physicians, (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare professionals (such as physician assistants and purse practitioners), and teaching hospitals, as well as ownership and investment interests held by such physicians and their immediate family members.
+Added: the federal Physician Payments Sunshine Act, which requires certain manufacturers of drugs, devices, biologicals and medical supplies for which payment is available under Medicare, Medicaid or the
+Added: Children’s Health Insurance Program (with certain exceptions) to report annually to CMS information related to payments or other transfers of value made to physicians, (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare professionals (such as physician assistants and purse practitioners), and teaching hospitals, as well as ownership and investment interests held by such physicians and their immediate family members.
We may also be subject to state and foreign equivalents of each of the healthcare laws described above, among others, some of which may be broader in scope.
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Our actual or perceived failure to comply with such obligations could lead to regulatory investigations or actions;
+Added: litigation (including class claims) and mass arbitration demands;
fines and penalties;
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In the ordinary course of business, we collect, receive, store, process, generate, use, transfer, disclose, make accessible, protect, secure, dispose of, transmit, and share (collectively, processing) personal data and other sensitive information, including proprietary and confidential business data, trade secrets, intellectual property, data we collect about trial participants in connection with clinical trials, and sensitive third-party data (collectively, sensitive data).
−Removed: Our data processing activities may subject us to numerous data privacy and security obligations, such as various laws, regulations, guidance, external and internal privacy and security policies, contractual obligations, and other obligations relating to data privacy and security.
+Added: Our data processing activities subject us to numerous data privacy and security obligations, such as
+Added: various laws, regulations, guidance, external and internal privacy and security policies, contractual obligations, and other obligations relating to data privacy and security.
In the United States, federal, state, and local governments have enacted numerous data privacy and security laws and regulations, including data breach notification laws, state and federal health information privacy laws, personal data privacy laws, and federal and state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), and other similar laws (e.g., wiretapping laws).
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While these states, like the CCPA, also exempt some data processed in the context of clinical trials, these developments may further complicate compliance efforts, and increase legal risk and compliance costs for us and the third parties upon whom we rely.
−Removed: Outside the United States, an increasing number of laws, and regulations may govern data privacy and security.
+Added: Outside the United States, an increasing number of laws, and regulations govern data privacy and security.
For example, the European Union’s General Data Protection Regulation (EU GDPR), the United Kingdom’s GDPR (UK GDPR), Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA), Australia’s Privacy Act, and New Zealand’s Privacy Act, impose strict requirements for processing personal data.
−Removed: For example, under the EU GDPR and UK GDPR, companies may face temporary or definitive bans on data processing and other corrective actions, fines of up to 20 million euros or 17.5 million pounds, respectively, 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.
+Added: For example, under the EU GDPR and UK GDPR, companies may face temporary or definitive bans on data processing and other corrective actions, fines of up to 20 million euros or 17.5 million pounds, respectively, or 4% of annual global revenue, in each case, 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.
In addition, we may be unable to transfer personal data from Europe and other jurisdictions to the United States or other countries due to data localization requirements or limitations on cross-border data flows.
Europe and other jurisdictions have enacted laws requiring data to be localized or limiting the transfer of personal data to other countries.
−Removed: In particular, the European Economic Area (EEA) and the UK have significantly restricted the transfer of personal data to the United States and other countries whose privacy laws they believe are inadequate.
+Added: In particular, the European Economic Area (EEA) and the UK have significantly restricted the transfer of personal data to the United States and other countries whose privacy laws they generally believe are inadequate.
Other jurisdictions may adopt similarly stringent interpretations of their data localization and cross-border data transfer laws.
−Removed: Although there are currently various mechanisms that may be used to transfer personal data from
−Removed: the EEA and UK to the United States in compliance with law, such as the EEA standard contractual clauses and UK’s international data transfer agreement, these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the United States.
−Removed: If there is no lawful manner for us to transfer personal data from the EEA and the UK or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions at significant expense, increased exposure to regulatory actions, substantial fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal data necessary to operate our business.
+Added: Although 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 standard contractual clauses, the UK’s international data transfer agreement/addendum, and the EU-U.S.
+Added: Data Privacy Framework (which allows for transfers for relevant U.S.-based organizations who self-certify compliance and participate in the Framework), these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the United States.
+Added: If there is no lawful manner for us to transfer personal data from the EEA and the UK or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions (such as Europe) at significant expense, increased exposure to regulatory actions, substantial fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal data necessary to
+Added: operate our business.
These challenges and risks concerning cross-border transfers of personal data out of the EEA and UK to recipients in other jurisdictions, notably recipients in the United States, may be of particular significance to us and our operations as the majority of the trials we conduct take place in locations outside the United States, with a large number occurring in the EEA or UK.
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In addition to data privacy and security laws, we are also bound by contractual obligations related to data privacy and security, and our efforts to comply with such obligations may not be successful.
+Added: Our employees and personnel may use generative artificial intelligence (AI) technologies to perform their work, and the disclosure and use of personal information in generative AI technologies is subject to various privacy laws and other privacy or legal obligations (such as copyright infringement).
+Added: Governments have passed and are likely to pass additional laws regulating generative AI.
+Added: Any use of this technology could result in additional compliance costs, regulatory investigations and actions, and consumer lawsuits.
+Added: If we are unable to use generative AI, it could make our business less efficient and result in competitive disadvantages.
We publish privacy policies, marketing materials and other statements, such as compliance with certain certifications or self-regulatory principles, regarding data privacy and security.
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These consequences may include, but are not limited to, government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar);
−Removed: litigation (including class-action claims);
+Added: litigation (including class-action claims) and mass arbitration demands;
additional reporting requirements and/or oversight;
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and orders to destroy or not use personal data.
+Added: In particular, plaintiffs have become increasingly more active in bringing privacy-related claims against companies, including class claims and mass arbitration demands.
+Added: Some of these claims allow for the recovery of statutory damages on a per violation basis, and, if viable, carry the potential for monumental statutory damages, depending on the volume of data and the number of violations.
Any of these events could have a material adverse effect on our reputation, business, or financial condition, including but not limited to:
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If any of these outcomes occur, we may be forced to restrict or delay efforts to seek regulatory approval in the UK or the EU for mavodelpar and any future product candidates, or incur significant additional expenses to operate our business, which could significantly and materially harm or delay our ability to generate revenues or achieve profitability of our business.
−Removed: The Retained EU Law (Revocation and Reform) Bill 2022, which is currently
−Removed: progressing through the UK Parliament and seeks to allow the UK Government to repeal or replace certain EU Law that was incorporated into UK law effective as of the end of the Transition Period, increases the likelihood of such divergence between UK and EU law, and the consequences set out above.
Any further changes in international trade, tariff and import/export regulations as a result of Brexit or otherwise may impose unexpected duty costs or other non-tariff barriers on us.
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under international tax treaties, and such an assertion, if successful, could increase our expected tax liability in one or more jurisdictions.
−Removed: A tax authority may take the position that material income tax liabilities, interest and penalties are payable by us, in which case, we
−Removed: expect that we might contest such assessment.
+Added: A tax authority may take the position that material income tax liabilities, interest and penalties are payable by us, in which case, we expect that we might contest such assessment.
Contesting such an assessment may be lengthy and costly and if we were unsuccessful in disputing the assessment, the implications could increase our anticipated effective tax rate, where applicable.
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Our inability to acquire financing on acceptable terms or at all may materially harm our business, financial condition, results of operations and prospects.
−Removed: There is no assurance that we will enter into a definitive funding agreement (Funding Agreement) with the investor and obtain funding on the terms set forth in the Term Sheet, or at all.
−Removed: Any definitive Funding Agreement executed pursuant to the Term Sheet would increase our operating complexity.*
−Removed: In April 2023, we entered into the Term Sheet with the investor for a structured royalty financing of up to $100 million in funding, in multiple tranches with each subject to certain conditions.
−Removed: The Term Sheet is non-binding and there is no assurance that we will enter into a Funding Agreement and obtain funding on the terms set forth in the Term Sheet, or at all.
−Removed: Entry into a Funding Agreement is subject to certain conditions, including the completion of confirmatory due diligence by the investor.
−Removed: We and the investor may determine to make material changes to the terms set forth in the Term Sheet prior to entering into a Funding Agreement, or not to ultimately enter into the Funding Agreement.
−Removed: In addition, the entry into the Funding Agreement may not occur on the timeline we currently expect, if at all.
−Removed: If we enter into a Funding Agreement with the investor, we expect there will be certain material conditions that we must satisfy, including granting the investor a security interest in all of our assets other than intellectual property not related to mavodelpar and entering into a collaboration agreement with the investor’s affiliated development company.
−Removed: Additionally, the Funding Agreement would restrict our ability to license or sublicense our intellectual property rights relating to mavodelpar, other than non-exclusive licenses and other customary permitted licenses, and would include customary negative covenants, including with respect to the incurrence of indebtedness subject to certain exceptions, which would increase our operating complexity and could materially harm our business, financial condition, results of operations, or prospects.
Risks Related to Our Reliance on Third Parties
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Nevertheless, we are responsible for ensuring that each of our clinical trials is conducted in accordance with applicable protocol, legal, regulatory, and scientific standards, and our reliance on our CROs does not relieve us of our regulatory responsibilities.
−Removed: We and our CROs are required to comply with GCPs, which are regulations and guidelines enforced by the FDA and comparable foreign regulatory authorities for product candidates in clinical development.
+Added: and our CROs are required to comply with GCPs, which are regulations and guidelines enforced by the FDA and comparable foreign regulatory authorities for product candidates in clinical development.
Regulatory authorities enforce these GCPs through periodic inspections of trial sponsors, principal investigators and trial sites.
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As a result, delays occur, which can materially impact our ability to meet our desired clinical development timelines.
−Removed: Although we carefully
−Removed: manage our relationships with our CROs, we may encounter challenges or delays in the future and these delays or challenges may have a material adverse impact on our business, prospects, financial condition, and results of operations.
−Removed: In addition, quarantines, shelter-in-place, and similar government orders, or the perception that such orders, shutdowns or other restrictions on the conduct of business operations could occur, related to COVID-19 or other infectious diseases could impact personnel at our CROs, which could disrupt our clinical timelines, which could have a material adverse impact on our business, prospects, financial condition, and results of operations.
+Added: Although we carefully manage our relationships with our CROs, we may encounter challenges or delays in the future and these delays or challenges may have a material adverse impact on our business, prospects, financial condition, and results of operations.
+Added: In addition, quarantines, shelter-in-place, and similar government orders, or the perception that such orders, shutdowns or other restrictions on the conduct of business operations could occur, related to infectious diseases could impact personnel at our CROs, which could disrupt our clinical timelines, which could have a material adverse impact on our business, prospects, financial condition, and results of operations.
We rely completely on third parties to manufacture our preclinical and clinical drug supplies and we intend to rely on third parties to produce commercial supplies of mavodelpar and any future product candidates, if approved, and these third parties may fail to obtain and maintain regulatory approval for their facilities, fail to provide us with sufficient quantities of drug product or fail to do so at acceptable quality levels or prices.*
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Our reliance on third-party suppliers and manufacturers, including single-source suppliers, could harm our ability to develop mavodelpar or commercialize it, if approved.
−Removed: Further, any delay in identifying and qualifying a manufacturer for commercial production could delay the potential commercialization of mavodelpar and any future product candidates, and, in the event that we do not have sufficient product to complete our clinical trials, it could delay such trials.
+Added: Further, any delay in identifying and qualifying a manufacturer for commercial production could
+Added: delay the potential commercialization of mavodelpar and any future product candidates, and, in the event that we do not have sufficient product to complete our clinical trials, it could delay such trials.
The facilities used by our contract manufacturers to manufacture mavodelpar and any future product candidates must be approved by the applicable regulatory authorities, including the FDA, pursuant to inspections that will be conducted after an NDA or comparable foreign regulatory marketing application is submitted.
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Furthermore, if contaminants are discovered in our supply of mavodelpar or any future product candidates or in the manufacturing facilities, such manufacturing facilities may need to be closed for an extended period of time to investigate and remedy the contamination.
−Removed: Any stability or other issues relating to the
−Removed: manufacture of mavodelpar may occur in the future.
−Removed: In addition, quarantines, shelter-in-place, and similar government orders, or the perception that such orders, shutdowns, or other restrictions on the conduct of business operations could occur, related to COVID-19 or other infectious diseases could impact personnel at our third-party manufacturing facilities upon which we rely, or the availability or cost of materials, which could disrupt the supply chain for our product candidates.
+Added: Any stability or other issues relating to the manufacture of mavodelpar may occur in the future.
+Added: In addition, quarantines, shelter-in-place, and similar government orders, or the perception that such orders, shutdowns, or other restrictions on the conduct of business operations could occur, related to infectious diseases could impact personnel at our third-party manufacturing facilities upon which we rely, or the availability or cost of materials, which could disrupt the supply chain for our product candidates.
Additionally, our manufacturers may experience manufacturing difficulties due to resource constraints or as a result of labor disputes or unstable political environments.
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We do not have any insurance for liabilities arising from hazardous materials.
−Removed: Compliance with applicable environmental laws and regulations is expensive, and current or future environmental regulations may impair our research, development, and production efforts, which could harm our business, prospects, financial condition, or results of operations.
+Added: Compliance with applicable environmental laws and regulations is expensive, and current or future
+Added: environmental regulations may impair our research, development, and production efforts, which could harm our business, prospects, financial condition, or results of operations.
Risks Related to Our Intellectual Property
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These pending patent applications, if issued, would be expected to expire between 2040 and 2043, absent any patent term adjustments or extensions.
−Removed: We also own one issued patent in the United States, one pending application in the United States, one pending international patent applications, and over 15 pending applications in foreign countries directed to methods of manufacturing, and crystalline forms (polymorphs) of mavodelpar.
−Removed: The issued patent, and pending patent applications if issued, are expected to expire in 2041, absent any patent term adjustments or extensions.
+Added: We also own two issued patents in the United States, two pending applications in the United States, and over 25 pending applications in foreign countries directed to methods of manufacturing, and crystalline forms (polymorphs) of mavodelpar.
+Added: The issued patents, and pending patent applications if issued, are expected to expire in 2041, absent any patent term adjustments or extensions.
Patents related to mavodelpar may be eligible for patent term extensions in certain jurisdictions, including up to five years in both the United States and the EU, upon approval of a commercial use of the corresponding product by a regulatory agency in the jurisdiction where the patent was granted.
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proprietary rights is uncertain.
−Removed: Only limited protection may be available and may not adequately protect our rights or permit us to gain or keep any competitive advantage.
+Added: Only limited protection may be available and may not
+Added: adequately protect our rights or permit us to gain or keep any competitive advantage.
These uncertainties and/or limitations in our ability to properly protect the intellectual property rights relating to our product candidates could have a material adverse effect on our financial condition and results of operations.
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The patent application process is subject to numerous risks and uncertainties, and there can be no assurance that we or any of our potential future collaborators will be successful in protecting our product candidates by obtaining and defending patents.
−Removed: The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment, and other similar provisions during the
−Removed: patent process.
+Added: The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment, and other similar provisions during the patent process.
Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on any issued patents and/or applications are due to be paid to the USPTO and foreign patent agencies in several stages over the lifetime of the patents and/or applications.
We have systems in place to remind us to pay these fees, and we employ an outside firm and rely on our outside counsel to pay these fees due to foreign patent agencies.
−Removed: While an inadvertent lapse may sometimes be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance (including as a result of the COVID-19 pandemic) can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.
+Added: While an inadvertent lapse may sometimes be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.
Non-compliance events that could result in abandonment or lapse of a patent or patent application include, but are not limited to, failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents.
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Even if patents covering our product candidates are obtained, once the patent term has expired for a product, we may be open to competition from generic products.
−Removed: As a result, our patent portfolio may not provide us with sufficient rights to exclude others from commercializing product candidates similar or identical to ours.
+Added: As a result, our patent portfolio may not provide us with sufficient rights to exclude others from commercializing product candidates similar or identical to
Upon issuance in the United States, the term of a patent can be increased by patent term adjustment, which is based on certain delays caused by the USPTO, but this increase can be reduced or eliminated based on certain delays caused by the patent applicant during patent prosecution.
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Given the amount of time required for the development, testing, and regulatory review and approval of new product candidates, patents protecting such candidates may expire before or shortly after such candidates are commercialized.
−Removed: As a result, our owned and licensed patent portfolio may not provide us with
−Removed: sufficient rights to exclude others from commercializing products similar or identical to ours.
+Added: As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.
For example, we have licensed patents from vTv Therapeutics that cover composition of matter of mavodelpar, which are set to expire in 2026, absent any patent term adjustments or extensions.
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If we are unable to obtain patent term extension or restoration, or the term of any such extension is less than we request, the period during which we will have the right to exclusively market our product will be shortened and our competitors may obtain approval of competing products following our patent expiration, and our revenue may be materially reduced.
−Removed: Further, if this occurs, our competitors may take advantage of our investment in development and trials by referencing our clinical and preclinical data and launch their product earlier than might otherwise be the case.
+Added: Further, if this occurs, our competitors may take advantage of our
+Added: investment in development and trials by referencing our clinical and preclinical data and launch their product earlier than might otherwise be the case.
We cannot ensure that patent rights relating to inventions described and claimed in our pending patent applications will issue or that patents based on our patent applications will not be challenged and rendered invalid and/or unenforceable.*
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One aspect of the determination of patentability of our inventions depends on the scope and content of the “prior art,”
−Removed: information that was or is deemed available to a person of skill in the relevant
−Removed: art prior to the priority date of the claimed invention.
+Added: information that was or is deemed available to a person of skill in the relevant art prior to the priority date of the claimed invention.
There may be prior art of which we are not aware that may affect the patentability of our patent claims or, if issued, affect the validity or enforceability of a patent claim relevant to our business.
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Our defense of derivation proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees.
−Removed: In addition, the uncertainties associated with such proceedings could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our development programs, license necessary technology from third parties or enter into development or manufacturing partnerships that would help us bring our product candidates to market.
+Added: In addition, the uncertainties associated with such proceedings could have a material adverse effect on our ability to raise the
+Added: funds necessary to continue our clinical trials, continue our development programs, license necessary technology from third parties or enter into development or manufacturing partnerships that would help us bring our product candidates to market.
If the scope of any patent protection we obtain is not sufficiently broad, or if we lose any of our patent protection and/or other market exclusivity, our ability to prevent our competitors from commercializing similar or identical product candidates may be adversely affected.
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Consequently, we do not know whether our product candidates will be protectable or remain protected by valid and enforceable patents.
−Removed: Our competitors or other third parties may be able to circumvent our patents or the patents of our future licensors by developing
−Removed: similar or alternative technologies or products in a non-infringing manner which could materially adversely affect our business, financial condition, results of operations and prospects.
+Added: Our competitors or other third parties may be able to circumvent our patents or the patents of our future licensors by developing similar or alternative technologies or products in a non-infringing manner which could materially adversely affect our business, financial condition, results of operations and prospects.
The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our patents or the patents of our future licensors may be challenged in the courts or patent offices in the United States and abroad.
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any successful opposition to any patents owned by or licensed to us could deprive us of rights necessary for the practice of our technologies or the successful commercialization of any products or product candidates that we may develop;
−Removed: because patent applications in the United States and most other countries are confidential for a period of time after filing, we cannot be certain that we or our licensors were the first to file any patent
−Removed: application related to mavodelpar, any future product candidates, and other proprietary technologies and their uses;
+Added: because patent applications in the United States and most other countries are confidential for a period of time after filing, we cannot be certain that we or our licensors were the first to file any patent application related to mavodelpar, any future product candidates, and other proprietary technologies and their uses;
an interference proceeding can be provoked by a third party or instituted by the USPTO to determine who was the first to invent any of the subject matter covered by the patent claims of our applications for any application with an effective filing date before March 16, 2013;
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In addition, our ability to obtain and maintain valid and enforceable patents depends on whether the differences between our inventions and the prior art allow our inventions to be patentable over the prior art.
−Removed: Furthermore, publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until 18 months after filing, or in some cases not at all.
+Added: Furthermore, publications of
+Added: discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until 18 months after filing, or in some cases not at all.
Therefore, we cannot be certain that we or our licensors were the first to make the inventions claimed in any of our owned or licensed patents or pending patent applications, or that we or our licensors were the first to file for patent protection of such inventions.
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Others have filed, and in the future are likely to file, patent applications covering products and technologies that are similar, identical or competitive to ours or important to our business.
−Removed: We cannot be certain that any patent application owned by a third party will not have priority over patent applications filed or in-licensed by us, or that we or our licensors will not be involved in interference, opposition or invalidity proceedings before U.S.
+Added: We cannot be certain that any patent application owned by a third party will not have priority over patent applications filed or in-licensed by us,
+Added: or that we or our licensors will not be involved in interference, opposition or invalidity proceedings before U.S.
patent offices.
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While we have an exclusive license to compositions of matter patents covering the molecular structure of mavodelpar, those patents will likely expire, absent patent term adjustment or extension, before the expiration of any regulatory exclusivity period that we may receive for mavodelpar.
−Removed: We also own one issued patent in the United States, that is expected to expire in 2041, absent any patent term adjustments or extensions, one pending application in the United States, and fifteen
−Removed: pending applications in foreign countries directed to polymorphs of mavodelpar.
−Removed: We cannot be certain that the claims in our pending patent applications directed to the polymorph of mavodelpar will be considered patentable by patent offices in foreign countries, or that the claims in any of our issued patents will be considered valid and enforceable by courts in the United States or foreign countries.
+Added: We also own two issued patents in the United States, that are expected to expire in 2041, absent any patent term adjustments or extensions, one pending application in the United States, and 15 pending applications in foreign countries directed to polymorphs of mavodelpar.
+Added: We cannot be certain that the claims in our pending patent applications directed to the polymorphs of mavodelpar will be considered patentable by patent offices in foreign countries, or that the claims in any of our issued patents will be considered valid and enforceable by courts in the United States or foreign countries.
Method of use patents protect the use of a product for the specified method.
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system in which, assuming that other requirements of patentability are met, the first inventor to file a patent application will be entitled to the patent regardless of whether a third party was first to invent the claimed invention.
−Removed: A third party that files a patent application in the USPTO after March 2013 but before us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by such third party.
+Added: A third party that files a patent
+Added: application in the USPTO after March 2013 but before us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by such third party.
This will require us to be cognizant going forward of the time from invention to filing of a patent application.
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patent applications in which claims are entitled to a priority date before March 16, 2013, an interference proceeding can be provoked by a third party or instituted by the USPTO to determine who was the first to invent any of the subject matter covered by the patent claims of our patents or patent applications.
−Removed: unfavorable outcome could require us to cease using the related technology or to attempt to license rights from the prevailing party.
+Added: An unfavorable outcome could require us to cease using the related technology or to attempt to license rights from the prevailing party.
Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms.
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Other countries may likewise enact changes to their patent laws in ways that adversely diminish the scope of patent protection and weaken the rights of patent owners to obtain patents, enforce patent infringement, and obtain injunctions and/or damages.
−Removed: In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained.
+Added: addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained.
We cannot predict the breadth of claims that may be allowed or enforced in our patents or in third-party patents, and whether Congress or other foreign legislative bodies may pass patent reform legislation that is unfavorable to us.
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Since patent applications in the United States and most other countries are confidential for a period of time after filing or until issuance, we cannot be certain that we or our licensors were the first to either (i) file any patent application related to our product candidates and other proprietary technologies we may develop or (ii) invent any of the inventions claimed in our or our licensor’s patents or patent applications.
−Removed: Even where we have a valid and enforceable patent, we may not
−Removed: be able to exclude others from practicing the claimed invention where the other party can show that they used the invention in commerce before our filing date or the other party benefits from a compulsory license.
+Added: Even where we have a valid and enforceable patent, we may not be able to exclude others from practicing the claimed invention where the other party can show that they used the invention in commerce before our filing date or the other party benefits from a compulsory license.
However, the America Invents Act and its implementation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents, all of which could have a material adverse effect on our business, financial condition, results of operations and prospects.
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In India, unlike the United States, there is no link between regulatory approval for a drug and its patent status.
−Removed: In addition to India, certain countries in Europe and developing countries, including China, have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties.
+Added: In addition to India, certain countries in Europe and developing countries, including China, have
+Added: compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties.
In addition, some countries limit the enforceability of patents against government agencies or government contractors.
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The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property protection, particularly those relating to biotechnology or pharmaceutical products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights generally.
−Removed: As an example, European applications will soon have the option, upon grant of a patent, of becoming a Unitary Patent which will be subject to the jurisdiction of the Unitary Patent Court (UPC).
+Added: As an example, European applications have the option, upon grant of a patent, of becoming a Unitary Patent which is subject to the jurisdiction of the Unitary Patent Court (UPC).
The option of a Unitary Patent will be a significant change in European patent practice.
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We may be subject to claims that former employees (including former employees of our licensors), collaborators or other third parties have an interest in our patent rights, trade secrets, or other intellectual property as an inventor or co-inventor.
−Removed: The failure to name the proper inventors on a patent application can result in the patents issuing thereon being unenforceable.
+Added: The failure to name the proper inventors on a patent application can result
+Added: in the patents issuing thereon being unenforceable.
For example, we may have inventorship disputes arise from conflicting views regarding the contributions of different individuals named as inventors, the effects of foreign laws where foreign nationals are involved in the development of the subject matter of the patent, conflicting obligations of third parties involved in developing mavodelpar or as a result of questions regarding co-ownership of potential joint inventions.
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We may also require the cooperation of our licensors and collaborators to enforce any licensed patent rights, and such cooperation may not be provided.
−Removed: Therefore, these patents and applications may not be prosecuted and enforced in a manner consistent with the best interests of our business, or in compliance with applicable laws and regulations, including by payment of all applicable fees for patents covering our product candidates, which may affect the validity and enforceability of such patents or any patents that may issue from such application.
+Added: Therefore, these patents and applications may not be
+Added: prosecuted and enforced in a manner consistent with the best interests of our business, or in compliance with applicable laws and regulations, including by payment of all applicable fees for patents covering our product candidates, which may affect the validity and enforceability of such patents or any patents that may issue from such application.
If any of our future licensors or collaboration partners fail to prosecute, maintain and enforce such patents and patent applications in a manner consistent with the best interests of our business, including by payment of all applicable fees for patents covering our product candidates, we could lose our rights to the intellectual property or our exclusivity with respect to those rights, our ability to develop and commercialize those product candidates may be adversely affected and we may not be able to prevent competitors from making, using and selling competing products.
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In addition, while we cannot currently determine the amount of the royalty obligations we would be required to pay on sales of future products, if any, the amounts may be significant.
−Removed: The amount of our future royalty obligations will depend on the technology and intellectual property we use in products that we successfully develop and
−Removed: commercialize, if any.
+Added: The amount of our future royalty obligations will depend on the technology and intellectual property we use in products that we successfully develop and commercialize, if any.
Therefore, even if we successfully develop and commercialize products, we may be unable to achieve or maintain profitability.
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In that event, we may be required to expend significant time and resources to redesign our technology, product candidates, or the methods for manufacturing them or to develop or license replacement technology, all of which may not be feasible on a technical or commercial basis.
−Removed: If we are unable to do so, we may be unable to develop or commercialize the affected product candidates, which could harm our business, financial condition, results of operations, and prospects significantly.
+Added: If we are unable to do so, we may
+Added: be unable to develop or commercialize the affected product candidates, which could harm our business, financial condition, results of operations, and prospects significantly.
We cannot provide any assurances that third-party patents do not exist which might be enforced against our current technology, manufacturing methods, product candidates, or future methods or products resulting in either an injunction prohibiting our manufacture or future sales, or, with respect to our future sales, an obligation on our part to pay royalties and/or other forms of compensation to third parties, which could be significant.
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The agreements under which we license intellectual property or technology from third parties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations.
−Removed: The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations, and prospects.
+Added: The resolution of any
+Added: contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations, and prospects.
Moreover, if disputes over intellectual property that we license in the future prevent or impair our ability to maintain our licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates, which could have a material adverse effect on our business, financial conditions, results of operations, and prospects.
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We are generally also subject to all of the same risks with respect to protection of intellectual property that we license as we are for intellectual property that we own, which are described herein.
−Removed: If we or our licensor fail to adequately protect this intellectual property, our ability to develop, manufacture or commercialize products could suffer.
+Added: If we or our licensor(s) fail to adequately protect this intellectual property, our ability to develop, manufacture or commercialize products could suffer.
If disputes over intellectual property rights that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, our business, results of operations, financial condition, and prospects may be adversely affected.
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Numerous U.S.
−Removed: and foreign issued patents and pending patent applications, which are owned by third parties, exist in the fields in which we are developing mavodelpar.
+Added: and foreign issued patents and
+Added: pending patent applications, which are owned by third parties, exist in the fields in which we are developing mavodelpar.
Litigation or other legal proceedings relating to intellectual property claims, with or without merit, is unpredictable and generally expensive and time consuming and, even if resolved in our favor, is likely to divert significant resources from our core business, including distracting our technical and management personnel from their normal responsibilities.
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We cannot guarantee that any of our patent searches or analyses, including the identification of relevant patents, the scope of patent claims or the expiration of relevant patents, are complete or thorough, nor can we be certain that we have identified each and every third-party patent and pending application in the United States and abroad that is relevant to our research and other operations or necessary for the commercialization of our product candidates in any jurisdiction.
−Removed: We also cannot provide any assurances that third-party patents do not exist which might be enforced against our current technology, including our research programs, product candidates, their respective methods of use, manufacture and formulations thereof, and could result in either an
−Removed: injunction prohibiting our manufacture or future sales, or, with respect to our future sales, an obligation on our part to pay royalties and/or other forms of compensation to third parties, which could be significant.
+Added: We also cannot provide any assurances that third-party patents do not exist which might be enforced against our current technology, including our research programs, product candidates, their respective methods of use, manufacture and formulations thereof, and could result in either an injunction prohibiting our manufacture or future sales, or, with respect to our future sales, an obligation on our part to pay royalties and/or other forms of compensation to third parties, which could be significant.
The coverage of patents is subject to interpretation by the courts, and the interpretation is not always uniform.
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Defense of these claims, regardless of their merit, could involve substantial expenses and could be a substantial diversion of management and other employee resources from our business.
−Removed: If we collaborate with third parties in the development of technology in the future, our collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to litigation or potential liability.
+Added: If we collaborate with third parties in the development of technology in the future, our collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a
+Added: way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to litigation or potential liability.
Further, collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability.
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Accordingly, an adverse determination in a judicial or administrative proceeding, or the failure to obtain necessary licenses, could prevent us from developing and commercializing our product candidates, which could harm our business, financial condition and operating results.
−Removed: In addition, intellectual
−Removed: property litigation, regardless of its outcome, may cause negative publicity and could prohibit us from marketing or otherwise commercializing our product candidates and technology.
+Added: In addition, intellectual property litigation, regardless of its outcome, may cause negative publicity and could prohibit us from marketing or otherwise commercializing our product candidates and technology.
We may be involved in lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time-consuming, and unsuccessful.
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The outcome following legal assertions of invalidity and unenforceability is unpredictable, and prior art could render our patents or those of our licensors invalid.
−Removed: If a defendant were to prevail on a legal assertion of invalidity and/or unenforceability, we would lose at least part, and perhaps all, of the patent protection on such product candidate.
+Added: If a defendant were to prevail on a legal assertion of invalidity
+Added: and/or unenforceability, we would lose at least part, and perhaps all, of the patent protection on such product candidate.
Such a loss of patent protection would have a material adverse impact on our business.
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Our defense of litigation or interference proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees.
−Removed: addition, the uncertainties associated with litigation could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties, or enter into development or manufacturing partnerships that would help us bring mavodelpar and any future product candidates to market.
+Added: In addition, the uncertainties associated with litigation could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties, or enter into development or manufacturing partnerships that would help us bring mavodelpar and any future product candidates to market.
Even if resolved in our favor, litigation or other legal proceedings relating to our intellectual property rights may cause us to incur significant expenses and could distract our technical and management personnel from their normal responsibilities.
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We rely in part on confidentiality agreements with our employees, outside scientific collaborators, CROs, third-party manufacturers, consultants, advisors, potential partners, and other third parties, to protect our trade secrets and other proprietary information.
−Removed: In addition to contractual measures, we try to protect the confidential nature of our trade secrets and
−Removed: other proprietary information using commonly accepted physical and technological security measures.
+Added: In addition to contractual measures, we try to protect the confidential nature of our trade secrets and other proprietary information using commonly accepted physical and technological security measures.
Despite these efforts, we cannot provide any assurances that all such agreements have been duly executed, and these agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information.
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We require our employees to enter into written employment agreements containing provisions of confidentiality and obligations to assign to us any inventions generated in the course of their employment.
−Removed: We further seek to protect our potential trade secrets, proprietary know-how and information in part, by entering into non-disclosure and confidentiality agreements with parties who are given access to them, such as outside scientific collaborators, CROs, third-party manufacturers, consultants, advisors, and other third
+Added: We further seek to protect our potential trade secrets, proprietary know-how and information in part, by entering into non-disclosure and confidentiality agreements with parties who are given access to them, such as outside scientific collaborators, CROs, third-party manufacturers, consultants, advisors, and other third parties.
With our consultants, advisors, contractors and outside scientific collaborators, these agreements typically include invention assignment obligations.
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If any of these events occurs or if any of our trade secrets were to be lawfully obtained or independently developed by a competitor or other third party, or if we otherwise lose protection for our trade secrets, the value of this information may be greatly reduced and our competitive position would be harmed and we would have no right to prevent them from using that technology or information to compete with us.
−Removed: If we do not apply for patent protection prior to such publication or if we cannot otherwise maintain the confidentiality of our proprietary technology and other confidential information, then our ability to obtain patent protection or to protect our trade secret information may be jeopardized.
+Added: If we do not apply for patent protection prior to such publication or if we cannot otherwise maintain the
+Added: confidentiality of our proprietary technology and other confidential information, then our ability to obtain patent protection or to protect our trade secret information may be jeopardized.
We may be subject to claims that we or our employees, outside scientific collaborators, CROs, third-party manufacturers, consultants, advisors, potential partners, and other third parties have wrongfully used or disclosed alleged confidential information or trade secrets of their former employers.
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our commencement of, or involvement in, litigation;
−Removed: general political and economic conditions, including those resulting from the COVID-19 pandemic or other infectious diseases, and bank failures.
+Added: general political and economic conditions, including those resulting from infectious diseases, and bank failures.
In addition, the stock market in general, and pharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies.
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disclosure in this Quarterly Report on Form 10-Q, not being required to have our internal control over financial reporting audited by our independent registered public accounting firm under Section 404 of the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley Act), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
−Removed: may take advantage of these exemptions until December 31, 2026 or until we are no longer an emerging growth company, whichever is earlier.
+Added: We may take advantage of these exemptions until December 31, 2026 or until we are no longer an emerging growth company, whichever is earlier.
We will cease to be an emerging growth company prior to the end of such five-year period if certain earlier events occur, including if we become a “large accelerated filer”
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and proxy access.
−Removed: Emerging growth companies and smaller reporting companies are exempted from certain of these requirements, but we may be required to implement these requirements sooner than budgeted or planned and thereby incur unexpected expenses.
+Added: Emerging growth companies and smaller reporting companies are exempted from certain of these requirements, but we may be required to implement these requirements sooner than budgeted or planned and thereby incur unexpected
Stockholder activism, the current political environment and the current high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to additional compliance costs and impact the manner in which we operate our business in ways we cannot currently anticipate.
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These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock.
−Removed: As of March 31, 2023, there were 25,107,430 shares of our common stock outstanding.
−Removed: In addition, shares of common stock that are either subject to outstanding options or performance-based restricted stock units or reserved for future issuance under our employee benefit plans will become eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules, and Rule 144 and
−Removed: Rule 701 under the Securities Act of 1933, as amended (the Securities Act).
+Added: As of June 30, 2023, there were 33,800,788 shares of our common stock outstanding.
+Added: In addition, shares of common stock that are either subject to outstanding options or performance-based restricted stock units or reserved for future issuance under our employee benefit plans will become eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules, and Rule 144 and Rule 701 under the Securities Act of 1933, as amended (the Securities Act).
If these additional shares of common stock are sold, or if it is perceived that they will be sold, in the public market, the trading price of our common stock could decline.
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Such sales may also result in material dilution to our existing stockholders, and new investors could gain rights, preferences and privileges senior to the holders of our common stock.
−Removed: As of March 31, 2023, the remaining capacity under the ATM facility was approximately $18.8 million in shares of common stock.
+Added: As of June 30, 2023, the remaining capacity under the ATM facility was approximately $18.8 million in shares of common stock.
Pursuant to our 2021 Equity Incentive Plan (the 2021 Plan), our management is authorized to grant stock options and other stock awards to our employees, directors and consultants.
−Removed: Additionally, the number of shares of our common stock reserved for issuance under our 2021 Plan will automatically increase on January 1 of each year through and including January 1, 2031, by 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors.
+Added: Additionally, the number of shares of
+Added: our common stock reserved for issuance under our 2021 Plan will automatically increase on January 1 of each year through and including January 1, 2031, by 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors.
In addition, pursuant to our 2021 Employee Stock Purchase Plan, the number of shares of our common stock reserved for issuance will automatically increase on January 1 of each calendar year through and including January 1, 2031, by the lesser of (i) 1% of the total number of shares of our common stock outstanding on the last day of the calendar month before the date of the automatic increase, and (ii) 729,174 shares;
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the authority of the board of directors to issue preferred stock on terms determined by the board of directors without stockholder approval and which preferred stock may include rights superior to the rights of the holders of common stock.
−Removed: In addition, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporate Law, which may prohibit certain business combinations with stockholders owning 15% or more of our outstanding voting stock.
+Added: In addition, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporate Law, which may prohibit certain business combinations with stockholders owning
+Added: 15% or more of our outstanding voting stock.
These anti-takeover provisions and other provisions in our amended and restated certificate of incorporation and amended and restated bylaws 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 the then-current board of directors and could also delay or impede a merger, tender offer, or proxy contest involving our company.
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These exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it 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.
−Removed: If a court were to find either exclusive forum provision contained in our amended and restated certificate of incorporation or amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur further significant additional costs associated with resolving the dispute in other jurisdictions, all of which could seriously harm our business.
+Added: If a court were to find either exclusive forum provision contained in our amended and restated certificate of incorporation or amended and restated bylaws to be
+Added: inapplicable or unenforceable in an action, we may incur further significant additional costs associated with resolving the dispute in other jurisdictions, all of which could seriously harm our business.
General Risk Factors
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We can be held liable for the corrupt or other illegal activities of our employees, agents, clinical research organizations, contractors and other collaborators and partners, even if we do not explicitly authorize or have actual knowledge of such activities.
−Removed: Any violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or
−Removed: import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.
+Added: Any violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.
Business disruptions could seriously harm our future revenues and financial condition and increase our costs and expenses.
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Additionally, theft of our intellectual property or proprietary business information could require substantial expenditures to remedy.
−Removed: We and the third-parties upon which we rely are subject to a variety of evolving threats including but not limited to social-engineering attacks (including through phishing attacks), malicious code (such as computer viruses or bugs), misconduct or error by employees or contractors, malware (including as a result of advanced persistent threat intrusions), ransomware, supply chain attacks, natural disasters, terrorism, war, telecommunication and electrical failure, adware, denial of service attacks (such as credential stuffing), credential harvesting, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats.
+Added: We and the third-parties upon which we rely are subject to a variety of evolving threats including but not limited to social-engineering attacks (including through deep fakes, which may be increasingly more difficult to identify as fake, and phishing attacks), malicious code (such as computer viruses or bugs), misconduct or error by employees or contractors, malware (including as a result of advanced persistent threat intrusions), ransomware, supply chain attacks, natural disasters, terrorism, war, telecommunication and electrical failure, adware, denial of service attacks (such as credential stuffing), credential harvesting, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats.
In particular, ransomware attacks are becoming increasingly prevalent and severe and can lead to significant interruptions in our operations, loss of sensitive data, reputational harm, and diversion of funds.
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Such disclosures are costly, and the disclosures or the failure to comply with such requirements could lead to adverse consequences.
−Removed: If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences such as government enforcement
−Removed: actions (for example, investigations, fines, penalties, audits, and inspections);
+Added: If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences such as government enforcement actions (for example, investigations, fines, penalties, audits, and inspections);
additional reporting requirements and/or oversight;
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In addition to experiencing a security incident, third parties may gather, collect, or infer sensitive information about us from public sources, data brokers, or other means that reveals competitively sensitive details about our organization and could be used to undermine our competitive advantage or market position.
+Added: Additionally, sensitive information of the Company could be leaked, disclosed, or revealed as a result of or in connection with our employee’s, personnel’s, or vendors’
+Added: use of generative AI technologies.
If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
The trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about us or our business.
−Removed: If one or more of the analysts who covers us downgrades our stock or publishes inaccurate or unfavorable research about our business, our stock price may decline.
+Added: If one or more of the analysts who covers us downgrades our
+Added: stock or publishes inaccurate or unfavorable research about our business, our stock price may decline.
If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline.
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.