What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2026-03-12 compared with 2025-03-06 · 1866 added, 1841 removed, 100 unchanged (97% of the section changed)

of Pre-Merger Oruka

August 29, 2024 (the “Merger Closing”), we completed our acquisition (the “Merger”) of Oruka Therapeutics, Inc.

(“Pre-Merger Oruka”) pursuant to an Agreement and Plan of Merger and Reorganization, dated as of April 3, 2024 (the “Merger

Following the transactions contemplated by the Merger Agreement, Pre-Merger Oruka merged with and into Atlas Merger

Sub Corp., a wholly owned subsidiary of ARCA biopharma, Inc.

(“ARCA”) and following that, Pre-Merger Oruka then merged with

and into Atlas Merger Sub II, LLC (“Second Merger Sub”), with Second Merger Sub being the surviving entity.

Second Merger

Sub changed its corporate name to “Oruka Therapeutics Operating Company, LLC.” Pre-Merger Oruka was a pre-clinical stage

biotechnology company that was incorporated on February 6, 2024 under the direction of Peter Harwin, a Managing Member of Fairmount Funds

Management LLC (“Fairmount”), for the purposes of holding rights to certain intellectual property being developed by Paragon

Therapeutics, Inc.

On August 29, 2024, we changed our name from “ARCA biopharma, Inc.” (“ARCA”)

to “Oruka Therapeutics, Inc.” and our Nasdaq ticker symbol from “ABIO” to “ORKA”.

are a clinical-stage biopharmaceutical company focused on developing novel monoclonal antibody therapeutics for psoriasis (“PsO”)

and other inflammatory and immunology (“I&I”) indications.

Our name is derived from or , for “skin,”

and arukah , for “restoration,” and reflects our mission to deliver therapies for chronic skin diseases that provide

patients the most possible freedom from their condition.

Our strategy is to apply antibody engineering and format innovations to validated

modes of action, which we believe will enable us to improve meaningfully upon the efficacy and dosing regimens of standard-of-care medicines

while significantly reducing technical and biological risk.

Our programs aim to treat and potentially modify disease by targeting mechanisms

with proven efficacy and safety involved in disease pathology and the activity of pathogenic tissue-resident memory T cells (“TRMs”).

Acquisition of Pre-Merger Oruka

On August 29, 2024 (the “Merger

Closing”), we completed our acquisition (the “Merger”) of Oruka Therapeutics, Inc.

(“Pre-Merger Oruka”)

pursuant to an Agreement and Plan of Merger and Reorganization, dated as of April 3, 2024 (the “Merger Agreement”).

the transactions contemplated by the Merger Agreement, Pre-Merger Oruka merged with and into Atlas Merger Sub Corp., a wholly owned subsidiary

of ARCA biopharma, Inc.

(“ARCA”) and following that, Pre-Merger Oruka then merged with and into Atlas Merger Sub II, LLC (“Second

Merger Sub”), with Second Merger Sub being the surviving entity.

Second Merger Sub changed its corporate name to “Oruka Therapeutics

Operating Company, LLC”.

Pre-Merger Oruka was a pre-clinical stage biotechnology company that was incorporated on February 6, 2024

under the direction of Peter Harwin, a Founding Partner at Fairmount Funds Management LLC (“Fairmount”), for the purposes

of holding rights to certain intellectual property being developed by Paragon Therapeutics, Inc.

On August 29,

2024, we changed our name from “ARCA biopharma, Inc.” (“ARCA”) to “Oruka Therapeutics, Inc.” and our

Nasdaq ticker symbol from “ABIO” to “ORKA”.

Company Overview

We are a clinical-stage biopharmaceutical

company focused on developing novel monoclonal antibody therapeutics for psoriasis (“PsO”) and other inflammatory and immunology

(“I&I”) indications.

Our name is derived from or , for “skin,” and arukah , for “restoration,”

and reflects our mission to deliver therapies for chronic skin diseases that provide patients the most possible freedom from their condition.

Our strategy is to apply antibody engineering and format innovations to validated modes of action, which we believe will enable us to

improve meaningfully upon the efficacy and dosing regimens of standard-of-care medicines while significantly reducing technical and biological

Our programs aim to treat and potentially modify disease by targeting mechanisms with proven efficacy and safety involved in disease

pathology and the activity of pathogenic tissue-resident memory T cells (“TRMs”).

lead program, ORKA-001, is designed to target the p19 subunit of interleukin-23 (“IL-23p19”) for the treatment of PsO.

co-lead program, ORKA-002, is designed to target interleukin-17A and interleukin-17F (“IL-17A/F”) for the treatment of PsO,

psoriatic arthritis (“PsA”), and other conditions.

These programs each bind their respective targets at high affinity and

incorporate half-life extension technology with the aim to increase exposure and decrease dosing frequency.

We believe that our focused

strategy, differentiated portfolio, and deep expertise position us to set a new treatment standard in large I&I markets with continued

is a high affinity, extended half-life monoclonal antibody (“mAb”) designed to target IL-23p19.

IL-23 is a pro-inflammatory

cytokine that plays a critical role in the proliferation and development of T helper 17 (“Th17”) cells, which are the primary

drivers of several autoimmune and inflammatory disorders, including PsO.

hidradenitis suppurativa (“HS”), psoriatic arthritis (“PsA”), and other conditions.

The product candidates in

these programs each bind their respective targets at high affinity and incorporate half-life extension technology with the aim to increase

exposure and decrease dosing frequency.

We believe that our focused strategy, differentiated portfolio, and deep expertise position us

to set a new treatment standard in large I&I markets with continued unmet need.

Our Portfolio and Development Plans

ORKA-001 is a high affinity,

extended half-life monoclonal antibody (“mAb”) designed to target IL-23p19.

IL-23 is a pro-inflammatory cytokine that plays

a critical role in the proliferation and development of T helper 17 (“Th17”) cells, which are the primary drivers of several

autoimmune and inflammatory disorders, including PsO.

IL-23 is composed of two subunits:

a p40 subunit that is shared

with IL-12 and a p19 subunit that is specific to IL-23.

First-generation IL-23 antibodies bound p40 and inhibited both IL-12 and IL-23

signaling, while more recent IL-23 antibodies targeting the p19 subunit have shown improved efficacy and safety.

Based on preclinical

evidence, we believe that ORKA-001 could achieve higher response rates than established therapies in PsO while requiring less frequent

dosing and maintaining the favorable safety profile of therapies targeting IL-23p19.

ORKA-001 is engineered with YTE half-life extension

technology, a specific three amino acid change in the fragment crystallizable (“Fc”) domain to modify the pH-dependent binding

to the neonatal Fc receptor (“FcRn”).

As a result, it has a pharmacokinetic profile designed to support a subcutaneous (“SQ”)

injection as infrequently as once or twice a year.

In addition, emerging evidence suggests that IL-23 blockade can modify the disease

biology of PsO, possibly leading to durable remissions and preventing the development of PsA.

We believe that the expected characteristics

of ORKA-001 increase its potential to deliver these disease-modifying benefits.

initiated dosing of healthy volunteers in a Phase 1 trial of ORKA-001 in the fourth quarter of 2024.

We expect to share interim data

from the first-in-human trial in healthy volunteers, including initial pharmacokinetic data, in the second half of 2025 and initial efficacy

on patients with PsO in the second half of 2026.

Based on recent precedent for PsO, we anticipate that the entire development program

from first-in-human to biologics license application (“BLA”) filing could take as little as six to seven years based

on the averages for recently approved medicines.

However, we have no control over the length of time needed for United States Food and

Drug Administration (“FDA”) review, and this timeline could vary.

is a high affinity, extended half-life mAb designed to target IL-17A and IL-17F (“IL-17A/F”).

IL-17 inhibition has become

central to the treatment of psoriatic diseases, including PsO and PsA, and has also shown efficacy in other I&I indications,

such as hidradenitis suppurativa (“HS”) and axial spondyloarthritis (“axSpA”).

More recently, the importance

of inhibiting the IL-17F isoform along with IL-17A has become appreciated, and dual blockade with the recently approved therapy Bimzelx

(bimekizumab) has led to higher response rates in patients than blockade of IL-17A alone.

ORKA-002 is designed to bind IL-17A/F at similar

epitopes, or binding sites, and affinity ranges as bimekizumab, but incorporates half-life extension technology that could enable more

convenient dosing intervals.

We plan to initiate dosing of healthy volunteers in a Phase 1 trial of ORKA-002 in the third quarter

We expect to share interim data from the first-in-human trial in healthy volunteers, including initial pharmacokinetic data,

in the first half of 2026.

view ORKA-002 and ORKA-001 as highly complementary.

Patients with moderate-to-severe PsO

that have purely skin manifestations are most often treated with IL-23 inhibitors due to

the high efficacy and tolerability of this mechanism.

However, for patients who also have

joint involvement or signs and symptoms of PsA, an IL-17 inhibitor is typically used due

to its efficacy in addressing both skin and joint symptoms.

a p40 subunit that is shared with IL-12 and a

p19 subunit that is specific to IL-23.

First-generation IL-23 antibodies bound p40 and inhibited both IL-12 and IL-23 signaling, while

more recent IL-23 antibodies targeting the p19 subunit have shown improved efficacy and safety.

Based on clinical evidence, we believe

that ORKA-001 could achieve higher response rates than established therapies in PsO while requiring less frequent dosing and maintaining

the favorable safety profile of therapies targeting IL-23p19.

ORKA-001 is engineered with

YTE half-life extension technology, a specific three amino acid change in the fragment crystallizable (“Fc”) domain to modify

the pH-dependent binding to the neonatal Fc receptor (“FcRn”).

As a result, it has a pharmacokinetic profile designed to support

a subcutaneous (“SQ”) injection as infrequently as once or twice per year.

In addition, emerging evidence suggests that IL-23

blockade can modify the disease biology of PsO, possibly leading to durable remissions and preventing the development of PsA.

believe that the anticipated characteristics of ORKA-001 enhance its potential to deliver these disease-modifying benefits.

We initiated a Phase 1

trial of ORKA-001 in the fourth quarter of 2024 and in September 2025, we announced the interim results at the European Academy of

Dermatology and Venereology (EADV) Congress.

The data showed that ORKA-001 has a human half-life of approximately 100 days.

doses of ORKA-001 demonstrated complete and sustained inhibition of STAT3 signaling, a downstream marker of IL-23 activity, in an ex

vivo assay through 24 weeks.

In addition, ORKA-001 was well tolerated at all dose levels, with a favorable safety profile consistent

with the anti-IL-23 class.

In the third quarter of 2025, we commenced dosing in a Phase 2a clinical trial of ORKA-001 in patients with moderate-to-severe PsO (also

known as “EVERLAST-A”).

We expect to share Week 16 data for all patients in the second quarter of 2026.

In addition, we plan

to share longer-term data, including Week 28 for all patients and 52-week follow-up for a portion of the cohort in the second half of

EVERLAST-A enrolled 84 patients randomized 3:1 to receive 600 mg of ORKA-001 at Weeks 0 and 4 or matching placebo.

The primary endpoint

is PASI 100, a 100% reduction from baseline in Psoriasis Area and Severity Index (“PASI”), at Week 16.

At Week 28, patients

who have achieved PASI 100 will be randomized 2:1 to an arm where either (1) they do not receive another dose until disease recurrence

(to evaluate the possibility of both yearly dosing and extended off-treatment remissions) or (2) they receive 300 mg ORKA-001 every six

Patients who have not achieved PASI 100 will receive a 300 mg dose every six months.

Additionally, the first patients were dosed in EVERLAST-B in December

EVERLAST-B is designed to enroll approximately 160 patients into a dose-ranging Phase 2b trial of ORKA-001 in patients with moderate-to-severe

PsO and will evaluate three dose levels of ORKA-001:

37.5 mg at Week 0, 300 mg at Weeks 0 and 4, and 600 mg at Weeks 0 and 4, versus placebo.

The primary endpoint is PASI 100 at Week 16.

At Week 28, patients who have achieved PASI 100 will be re-randomized 1:1 to either a 600

mg dose once-yearly or matching placebo.

Patients who have not achieved PASI 100 at Week 28 will receive a 300 mg dose every six months.

Building on EVERLAST-A, this design will further test the potential for ORKA-001 to achieve yearly dosing, higher efficacy and extended

off-treatment remissions.

Data from EVERLAST-B is anticipated in 2027.

Based on recent precedent

in PsO, we anticipate that the overall development program, from first-in-human studies through biologics license application (“BLA”)

submission could take as little as six to seven years, based on averages observed for recently approved medicines.

However, we have

no control over the duration of the United States Food and Drug Administration (“FDA”) review process, and the actual timeline

ORKA-002 is a high affinity, extended half-life mAb designed to target

IL-17A and IL-17F (“IL-17A/F”).

IL-17 inhibition has become central to the treatment of psoriatic diseases, including PsO

and PsA, and has also shown efficacy in other I&I indications, such as HS and axial spondyloarthritis (“axSpA”).

recently, the importance of inhibiting the IL-17F isoform along with IL-17A has become appreciated, and dual blockade with the recently

approved therapy Bimzelx (bimekizumab) has led to higher response rates in patients than blockade of IL-17A alone.

ORKA-002 is designed

to bind IL-17A/F at similar epitopes, or binding sites, and affinity ranges as bimekizumab, but incorporates half-life extension technology

that could enable more convenient dosing intervals.

In January 2026, we announced

interim findings from the Phase 1 trial of ORKA-002 in healthy volunteers.

The results showed that ORKA-002 has a half-life of approximately

75-80 days, which supports the potential for twice-yearly maintenance dosing in PsO and quarterly maintenance dosing in HS.

of ORKA-002 demonstrated potent and sustained inhibition of IL-17 signaling in an ex vivo assay through 24 weeks.

ORKA-002 was well tolerated

at all dose levels, with a favorable safety profile consistent with the anti-IL-17 class.

The trial remains blinded, and as of January 6, 2026, which was the data cutoff date, all subjects remained on trial.

Based on these Phase 1

results, we initiated ORCA-SURGE, a Phase 2 trial of ORKA-002 in patients with moderate-to-severe PsO, in February 2026.

is designed to enroll approximately 160 patients randomized 1:1:1:1 to receive 40 mg, 160 mg or 320 mg of ORKA-002 at Weeks 0 and 4,

or matching placebo.

The primary endpoint is PASI 100 at Week 16.

Maintenance dosing will evaluate the potential for twice-yearly

dosing with ORKA-002.

Data from ORCA-SURGE is anticipated in 2027.

Moreover, we also expect to initiate a Phase 2 trial of ORKA-002

in patients with HS in the second half of 2026.

We view ORKA-002 and ORKA-001

as highly complementary.

Patients with moderate-to-severe PsO that have purely skin manifestations are most often treated with IL-23 inhibitors

due to the high efficacy and tolerability of this mechanism.

However, for patients who also have joint involvement or signs and symptoms

of PsA, an IL-17 inhibitor is typically used due to its efficacy in addressing both skin and joint symptoms.

In addition, IL-17 inhibitors

are often used in patients with highly resistant skin symptoms that do not adequately resolve

through treatment with an IL-23 inhibitor.

Furthermore, we have the potential opportunity

to administer ORKA-002 and ORKA-001 sequentially, called ORKA-021, to combine two attractive

features of each program:

the rapid response of an IL-17 inhibitor with the ideal maintenance

profile of an IL-23 inhibitor.

We believe that ORKA-001 and ORKA-002 provide the potential

to offer a highly compelling product profile for most patients with PsO and/or PsA, as well

as the opportunity to address additional I&I indications.

Pipeline Program

have a third mAb program, ORKA-003, designed to target an undisclosed pathway.

Our strategy as a company is to remain highly focused

on I&I diseases, and specifically on inflammatory dermatology conditions.

Our third program provides the potential for indication

expansion beyond PsO and may create combination opportunities with our more advanced programs.

Team, Investors, and Paragon Collaboration

are led by a management team with significant experience in developing novel treatments for patients at biopharmaceutical companies such

as CRISPR Therapeutics, Celgene, Novartis, CymaBay Therapeutics and Protagonist Therapeutics.

Together, our team has a proven track record

of building successful biotech organizations in high-growth environments.

Oruka was founded in February 2024 by leading healthcare investor Fairmount.

Fairmount founded Paragon in 2021 to conduct biologics

discovery and optimization, including acting as the firm’s discovery engine for biologics that potentially overcome limitations

of existing therapies.

We have entered into license agreements with Paragon pursuant to which Paragon granted us a royalty-bearing, world-wide,

exclusive license to develop, manufacture, commercialize or otherwise exploit certain antibodies and products targeting IL-23 outside

of the field of inflammatory bowel disease for ORKA-001 and for ORKA-002, certain antibodies and products targeting IL-17A/F.

achieve our goal of developing leading therapeutic antibodies for patients with inflammatory skin diseases, we are applying antibody

engineering to validated modes of action.

We believe this approach will enable us to improve meaningfully upon the efficacy and convenience

of standard-of-care medicines while significantly reducing technical and biological risk.

are often used in patients with highly resistant skin symptoms that do not adequately resolve through treatment with an IL-23 inhibitor.

Furthermore, we plan to pursue a sequential combination regimen of ORKA-002 followed by ORKA-001, called ORKA-021.

ORKA-021 has the potential

to combine the rapid response of an IL-17 inhibitor with the superior maintenance profile of an IL-23 inhibitor in a single regimen.

believe that ORKA-001 and ORKA-002 provide the potential to offer a highly compelling product profile for most patients with PsO and/or

PsA, as well as the opportunity to address additional I&I indications.

Additional Pipeline Program

We have a third program,

ORKA-003, designed to target an undisclosed pathway.

Our strategy as a company is to remain highly focused on I&I diseases, and

specifically on inflammatory dermatology conditions.

Our third program provides the potential for indication expansion beyond PsO and

may create combination opportunities with our more advanced programs.

Our Team, Investors, and Paragon Collaboration

We are led by a management

team with significant experience in developing novel treatments for patients at biopharmaceutical companies such as CRISPR Therapeutics,

Celgene, Novartis, CymaBay Therapeutics and Protagonist Therapeutics.

Together, our team has a proven track record of building successful

biotech organizations in high-growth environments.

Pre-Merger Oruka was founded

in February 2024 by leading healthcare investor Fairmount.

Fairmount founded Paragon in 2021 to conduct biologics discovery and

optimization, including acting as the firm’s discovery engine for biologics that potentially overcome limitations of existing therapies.

We have entered into license agreements with Paragon pursuant to which Paragon granted us a royalty-bearing, world-wide, exclusive license

to develop, manufacture, commercialize or otherwise exploit certain antibodies and products targeting IL-23 outside of the field of inflammatory

bowel disease for ORKA-001 and for ORKA-002, certain antibodies and products targeting IL-17A/F in all fields.

To achieve our goal of developing

leading therapeutic antibodies for patients with inflammatory skin diseases, we are applying antibody engineering to validated modes of

We believe this approach will enable us to improve meaningfully upon the efficacy and convenience of standard-of-care medicines

while significantly reducing technical and biological risk.

The key elements of our strategy include:

advanced antibody engineering to build biologics that could significantly improve upon existing

We and our collaborators at Paragon have optimized

a variety of parameters using a suite of antibody technologies to develop candidates with

the potential to improve upon existing therapies.

These parameters include extending half-life

to increase exposure and reduce dosing frequency, enhancing affinity and specificity to maximize

potency and safety, and optimizing developability to ensure consistency and enable convenient,

high-dose formulations.

Together, we believe these features have the potential to translate

into more efficacious and convenient medicines for patients.

● Employ advanced

antibody engineering to build biologics that could significantly improve upon existing therapies:

We and our collaborators

at Paragon have optimized a variety of parameters using a suite of antibody technologies to develop product candidates with the

potential to improve upon existing therapies.

These parameters include extending half-life to increase exposure and reduce dosing

frequency, enhancing affinity and specificity to maximize potency and safety, and optimizing developability to ensure consistency

and enable convenient, high-dose formulations.

Together, we believe these features have the potential to translate into more

efficacious and convenient medicines for patients.

validated mechanisms of action:

Our initial targets, IL-23p19

and IL-17A/F, have established efficacy and safety for the treatment of PsO, PsA, and other

The FDA has approved four biologics in the IL-23 class, including three targeting

IL-23p19, and four biologics in the IL-17 class, including one targeting IL-17A/F.

these therapies have advanced the standard of care in PsO and PsA, they have not addressed

these diseases completely, and a significant fraction of patients do not achieve complete

skin clearance.

By applying our advanced antibody engineering to these validated targets,

we believe we can maximize our chances of developing superior medicines for patients.

addition, the reduced technical and biological risk of these validated mechanisms may allow

us to progress our programs more efficiently and rapidly.

Our initial targets, IL-23p19 and IL-17A/F, have established efficacy

and safety for the treatment of PsO, PsA, and other indications.

The FDA has approved five biologics in the IL-23 class, including four

targeting IL-23p19, and four biologics in the IL-17 class, including one targeting IL-17A/F.

While these therapies have advanced

the standard of care in PsO and PsA, they have not addressed these diseases completely, and a significant fraction of patients do not

achieve complete skin clearance.

By applying our advanced antibody engineering to these validated targets, we believe we can maximize

our chances of developing superior medicines for patients.

In addition, the reduced technical and biological risk of these validated mechanisms

may allow us to progress our programs more efficiently and rapidly.

insights from earlier entrants to optimize our approach:

benefit from a large body of clinical evidence generated by prior therapies targeting IL-23

We benefit from a large body of clinical evidence

generated by prior therapies targeting IL-23 and IL-17.

We continue to extract and apply learnings from this precedent to our programs,

including in development candidate selection, clinical trial design, dosing regimens, formulations

and presentations, regulatory pathway, and indication prioritization.

For instance, based

on correlations between affinity and efficacy, we have designed ORKA-001 and ORKA-002 to

bind to similar epitopes and at similar or greater affinities as the leading antibodies in

risankizumab and bimekizumab, respectively, with the aim of maximizing efficacy.

Also, by understanding the exposure-response relationships for efficacy and safety for other

therapies, we plan to select dose levels and regimens that could maximize efficacy and maintenance

of response while maintaining safety.

opportunities with strong prospects of yielding meaningful new medicines as a “base

case” and the potential to shift the treatment paradigm entirely as an “upside

including in development candidate selection, clinical trial design, dosing regimens, formulations and presentations, regulatory pathway,

and indication prioritization.

For instance, based on correlations between affinity and efficacy, we have designed ORKA-001 and ORKA-002

to bind to similar epitopes and at similar or greater affinities as the leading antibodies in each class:

risankizumab and bimekizumab,

respectively, with the aim of maximizing efficacy.

Also, by understanding the exposure-response relationships for efficacy and safety

for other therapies, we plan to select dose levels and regimens that could maximize efficacy and maintenance of response while maintaining

opportunities with strong prospects of yielding meaningful new medicines as a “base case” and the potential to shift the

treatment paradigm entirely as an “upside case”:

Our strategy seeks to maximize the potential

for our programs to reach a base case product profile that could meaningfully advance the

standard of care—for instance, for ORKA-001, SQ dosing one or twice a year with equal

or greater efficacy compared to today’s standard of care.

At the same time, we aim

to deliver an upside case that dramatically improves outcomes for patients—for instance,

significantly increasing rates of complete skin clearance via higher antibody exposures or

offering patients durable remissions free from therapy by introducing patient-specific dosing

a preeminent biotechnology company focused on chronic skin disease and other I&I

We are assembling a team of exceptional people

and helping them reach their full potential and flourish so that together we can bring forward

for our programs to reach a base case product profile that could meaningfully advance the standard of care—for instance, for ORKA-001,

SQ dosing one or twice per year with equal or greater efficacy compared to today’s standard of care.

At the same time, we aim to

deliver an upside case that dramatically improves outcomes for patients—for instance, significantly increasing rates of complete

skin clearance via higher antibody exposures or offering patients durable remissions free from therapy by introducing patient-specific

dosing intervals.

a preeminent biopharmaceutical company focused on chronic skin disease and other I&I indications:

are assembling a team of exceptional people and helping them reach their full potential and flourish so that together we can bring forward

meaningful new medicines for patients.

believe that pursuing the focused strategy outlined above will help us to succeed in our mission of offering patients living with PsO,

PsA, and other dermatologic and inflammatory diseases the greatest possible freedom from their condition.

IL-23 and IL-17 to Treat Multiple I&I Indications

programs benefit from significant advances in the understanding of the biology of I&I diseases over the past four decades.

and ORKA-002 are designed to target two key cytokines that play a related role in multiple indications.

We believe that pursuing

the focused strategy outlined above will help us to succeed in our mission of offering patients living with PsO, PsA, and other dermatologic

and inflammatory diseases the greatest possible freedom from their condition.

Targeting IL-23 and IL-17 to Treat Multiple I&I

Our programs benefit

from significant advances in the understanding of the biology of I&I diseases over the past four decades.

ORKA-002 are designed to target two key cytokines that play a related role in multiple indications.

IL-23 is an upstream regulator

of Th17 cells, a pro-inflammatory subset of T helper cells characterized by their production of IL-17.

IL-23 has a critical role in maintaining

Th17 cells in the tissue as well as activating these cells to secrete IL-17, which acts downstream to trigger inflammation and other

disease symptoms.

Th17 cells are involved in PsO, PsA, HS, axSpA, and many other diseases.

They play a particularly central role in PsO

The diagram below depicting the immunopathogenesis of PsO provides an example of how Th17 cells can mediate disease and how

blocking IL-23 or IL-17 can break the inflammatory cycle that drives disease.

Immunopathogenesis

of PsO and the role of IL-23 and IL-17

develops when environmental triggers and a genetic predisposition combine to cause activation of an inflammatory cycle in the skin that

leads to the formation of plaques and other disease manifestations.

This process begins with the aberrant activation of the dendritic

cells (“DCs”), specifically those producing IL-23 and other cytokines like IL-1β, IL-21, TNF-α, and IL-12.

cytokines induce the differentiation of Th17 cells, as well as other cell types, such as T helper type 1 (“Th1”) cells that

produce IFNγ and TNF-α and T helper type 22 (“Th22”) cells that produce IL-22.

IL-23 plays a key role in the

differentiation and activation of Th17 cells to secrete IL-17, as well as Th22 cells to produce IL-22.

IL-17 and these other cytokines

induce keratinocyte hyperproliferation leading to plaque formation and a feedforward inflammatory response, with changes in gene expression

in keratinocytes, the production of antimicrobial peptides, and neutrophil recruitment driving further inflammation.

While many cytokines

and cell types contribute to the pathogenesis of PsO, the IL-23/IL-17 axis plays an important role, as supported by the success of therapies

targeting this axis.

the successful treatment of PsO — for instance, with mAbs targeting IL-23 or IL-17 — can result in lesional

skin returning to an apparently normal state, disease tends to recur at previously affected sites following cessation of therapy, suggesting

a mechanism of “immunological memory” that predisposes individuals to recurrence in the same locations.

Evidence suggests

that pathogenic TRMs play a critical role in this memory.

TRMs may arise from the Th17 cells and other cells that drove disease in the

first place and remain in their resident tissue, in this case the epidermis and dermis, for long periods of time.

Upon a disease trigger,

these TRMs can actively produce proinflammatory cytokines, causing disease recurrence.

IL-23 appears to play an important role in maintaining

and potentiating TRMs, as indicated by the depletion of TRMs following treatment with an IL-23 inhibitor but not an IL-17 inhibitor,

which may explain the longer remissions observed with IL-23 inhibitors following withdrawal of therapy.

This type of data has raised

the prospect that efficient IL-23 blockade could modify the disease biology of PsO, possibly leading to durable remissions.

scientific discoveries that refined our understanding of the immunopathogenesis of PsO have led to waves of therapeutic advances, ultimately

leading to today’s standard of care.

Before the 1980s, PsO was not even thought of as an immunologic disease, but rather a disease

of keratinocyte dysfunction, leading to treatments such as phototherapy, methotrexate, and retinoids.

The discovery in the 1980s that

PsO results from immune dysfunction led to the use of broad immunosuppressants like cyclosporine.

From 1990 to 2008, it was believed

that Th1 cells were the predominant mediators of the disease, which led to the use of biologics targeting TNF-α such as Enbrel

(etanercept) and Humira (adalimumab).

Finally, the revelation that PsO is driven principally by Th17 cells resulted in the development

of the primary therapies used today, which target IL-23 and IL-17.

This increasingly refined understanding of the disease has narrowed

the standard of care from broad immunosuppressive agents (such as cyclosporine) to more specific immunomodulators (TNF-α inhibitors)

to precise biologic therapies targeting the key cytokines involved in disease pathology (IL-23 and IL-17 inhibitors), with each new therapeutic

class raising the bar on both safety and efficacy.

therapies, especially mAbs, are now mainstays in the treatment of a wide variety of I&I diseases, including PsO and PsA.

that have improved upon efficacy and/or reduced dosing frequency have achieved the most commercial success, even when launched many years

after other biologics.

IL-23 has a critical role in

maintaining Th17 cells in the tissue as well as activating these cells to secrete IL-17, which acts downstream to trigger

inflammation and other disease symptoms.

Th17 cells are involved in PsO, HS, PsA, axSpA, and many other diseases.

particularly central role in PsO and PsA.

The diagram below depicting the immunopathogenesis of PsO provides an example of how Th17

cells can mediate disease and how blocking IL-23 or IL-17 can break the inflammatory cycle that drives disease.

Immunopathogenesis of PsO and the role of IL-23

PsO develops when environmental

triggers and a genetic predisposition combine to cause activation of an inflammatory cycle in the skin that leads to the formation of

plaques and other disease manifestations.

This process begins with the aberrant activation of the dendritic cells (“DCs”),

specifically those producing IL-23 and other cytokines like IL-1β, IL-21, TNF-α, and IL-12.

These cytokines induce the differentiation

of Th17 cells, as well as other cell types, such as T helper type 1 (“Th1”) cells that produce IFNγ and TNF-α

and T helper type 22 (“Th22”) cells that produce IL-22.

IL-23 plays a key role in the differentiation and activation of Th17

cells to secrete IL-17, as well as Th22 cells to produce IL-22.

IL-17 and these other cytokines induce keratinocyte hyperproliferation

leading to plaque formation and a feedforward inflammatory response, with changes in gene expression in keratinocytes, the production

of antimicrobial peptides, and neutrophil recruitment driving further inflammation.

While many cytokines and cell types contribute to

the pathogenesis of PsO, the IL-23/IL-17 axis plays an important role, as supported by the success of therapies targeting this axis.

While the successful treatment

of PsO — for instance, with mAbs targeting IL-23 or IL-17 — can result in lesional skin returning to an apparently

normal state, disease tends to recur at previously affected sites following cessation of therapy, suggesting a mechanism of “immunological

memory” that predisposes individuals to recurrence in the same locations.

Evidence suggests that pathogenic TRMs play a critical

role in this memory.

TRMs may arise from the Th17 cells and other cells that drove disease in the first place and remain in their resident

tissue, in this case the epidermis and dermis, for long periods of time.

Upon a disease trigger, these TRMs can actively produce proinflammatory

cytokines, causing disease recurrence.

IL-23 appears to play an important role in maintaining and potentiating TRMs, as indicated by the

depletion of TRMs following treatment with an IL-23 inhibitor but not an IL-17 inhibitor, which may explain the longer remissions observed

with IL-23 inhibitors following withdrawal of therapy.

This type of data has raised the prospect that efficient IL-23 blockade could modify

the disease biology of PsO, possibly leading to durable remissions.

The scientific discoveries

that refined our understanding of the immunopathogenesis of PsO have led to waves of therapeutic advances, ultimately leading to today’s

standard of care.

Before the 1980s, PsO was not even thought of as an immunologic disease, but rather a disease of keratinocyte dysfunction,

leading to treatments such as phototherapy, methotrexate, and retinoids.

The discovery in the 1980s that PsO results from immune dysfunction

led to the use of broad immunosuppressants like cyclosporine.

From 1990 to 2008, it was believed that Th1 cells were the predominant mediators

of the disease, which led to the use of biologics targeting TNF-α such as Enbrel (etanercept) and Humira (adalimumab).

the revelation that PsO is driven principally by Th17 cells resulted in the development of the primary therapies used today, which target

IL-23 and IL-17.

This increasingly refined understanding of the disease has narrowed the standard of care from broad immunosuppressive

agents (such as cyclosporine) to more specific immunomodulators (TNF-α inhibitors) to precise biologic therapies targeting the key

cytokines involved in disease pathology (IL-23 and IL-17 inhibitors), with each new therapeutic class raising the bar on both safety and

Biologic therapies, especially

mAbs, are now mainstays in the treatment of a wide variety of I&I diseases, including PsO and PsA.

Therapies that have improved

upon efficacy and/or reduced dosing frequency have achieved the most commercial success, even when launched many years after other

Enbrel was first approved for PsO in 2004 with a weekly maintenance dosing schedule.

Four years later, Humira

was approved for PsO with an every-other-week (Q2W) dosing schedule.

Stelara (ustekinumab) was approved a year later with similar Phase 3

data to Humira, but with a significantly improved dosing schedule of every twelve weeks (Q12W).

Several drugs for PsO have been

approved since 2009 that demonstrated higher efficacy in their pivotal studies compared to Stelara, but with more burdensome dosing schedules,

Four years later, Humira was approved

for PsO with an every-other-week (Q2W) dosing schedule.

Stelara (ustekinumab) was approved a year later with similar Phase 3 data

to Humira, but with a significantly improved dosing schedule of every twelve weeks (Q12W).

Several drugs for PsO have been approved

since 2009 that demonstrated higher efficacy in their pivotal studies compared to Stelara, but with more burdensome dosing schedules,

including Tremfya (guselkumab), which has a dosing schedule of every eight weeks (Q8W), and Cosentyx (secukinumab) and Taltz (ixekizumab),

which have dosing schedules of every four weeks (Q4W).

While these therapies have all become generally successful products, the

most commercially successful drug in the PsO market today is Skyrizi (risankizumab), which combines Stelara’s Q12W dosing schedule

with improvements in efficacy, as evidenced by a higher psoriasis area severity index (PASI) score of PASI 90 and PASI 100 rates (i.e.,

a 90% improvement in PASI score and a 100% improvement in PASI score (complete clearance), respectively) in clinical trials.

Bimzelx (bimekizumab), approved by the FDA in 2023, has shown evidence of efficacy that exceeds even Skyrizi, though with a less convenient

Q8W dosing schedule.

Although many biologics have entered the PsO market over the past two decades, new entrants have had significant

commercial success when they have improved upon efficacy and/or dosing frequency, and room remains to improve in both areas to set a

new standard for the treatment of PsO.

have raised the bar on the standard of care in PsO, but leave room for improvement

biology driving PsO and PsA is well understood today, and the standard of care has progressed dramatically.

We believe that it is unlikely

that a novel mechanism will emerge that is as safe and efficacious as targeting the IL-23/IL-17 axis.

Therefore, we believe that innovation

now should be focused on optimizing the product profile that can be offered to patients.

While much effort is being directed toward daily

oral formats to inhibit this axis, oral medicines have yet to match the efficacy of biologics.

We believe that a better biologic with

a longer dosing interval and the potential for improved efficacy will present a more attractive product profile for most patients.

of Psoriasis (PsO)

is a chronic autoimmune skin disorder that affects an estimated 125 million people worldwide with steadily increasing prevalence,

estimated to be around 2 – 3% of the population currently, according to the World Psoriasis Day consortium.

the largest pharmaceutical market within dermatology, with annual sales of approximately $25.0 billion in 2022, which is estimated

to grow to $32 billion by 2028.

While these therapies have all become generally successful products, the most

commercially successful drug in the PsO market today is Skyrizi (risankizumab), which combines Stelara’s Q12W dosing schedule with

improvements in efficacy, as evidenced by a higher PASI score of PASI 90 and PASI 100 rates (i.e., a 90%

improvement in PASI score and a 100% improvement in PASI score (complete clearance), respectively) in clinical trials.

In addition, Bimzelx

(bimekizumab), approved by the FDA in 2023, has shown evidence of efficacy that exceeds even Skyrizi, though with a less convenient Q8W

dosing schedule.

Although many biologics have entered the PsO market over the past two decades, new entrants have had significant commercial

success when they have improved upon efficacy and/or dosing frequency, and room remains to improve in both areas to set a new standard

for the treatment of PsO.

Biologics have raised the bar on the standard

of care in PsO, but leave room for improvement

The biology driving PsO and

PsA is well understood today, and the standard of care has progressed dramatically.

We believe that it is unlikely that a novel mechanism

will emerge that is as safe and efficacious as targeting the IL-23/IL-17 axis.

Therefore, we believe that innovation now should be focused

on optimizing the product profile that can be offered to patients.

While much effort is being directed toward daily oral formats to inhibit

this axis, oral medicines have yet to match the efficacy of biologics.

We believe that a better biologic with a longer dosing interval

and the potential for improved efficacy will present a more attractive product profile for most patients.

Overview of Psoriasis (PsO)

PsO is a chronic autoimmune skin disorder that affects an estimated

125 million people worldwide with steadily increasing prevalence, estimated to be around 2 – 3% of the population

currently, according to the International Federation of Psoriasis Associations (“IFPA”).

It is the largest pharmaceutical

market within dermatology, with annual global sales of approximately $28 billion in 2024, which is estimated to grow to approximately

$40 billion by 2032.

The most common form of PsO is plaque psoriasis.

6 unchanged sentences

Between one-quarter and one-half of PsO patients

have moderate disease, defined as having 3% to 10% of the body surface area (“BSA”) involved, or severe disease, defined

as having more than 10% BSA involvement.

have moderate disease, defined as having 3% to 10% of the body surface area (“BSA”) involved, or severe disease, defined as

having more than 10% BSA involvement.

The chronic inflammation in PsO is associated with multiple comorbidities, including PsA, obesity,

metabolic syndrome, hypertension, diabetes, and atherosclerotic cardiovascular disease.

discussed earlier, PsO is a complex immune-mediated disease driven primarily by Th17 cells and the cytokines IL-23 and IL-17.

The interplay

of environmental and behavioral risk factors and genetics is believed to trigger PsO.

Multiple lines of evidence support a genetic

component to the disease, including the observation that approximately 40% of patients with PsO and PsA have a family history of the

disease and the identification of multiple susceptibility loci, many containing genes related to the regulation of the immune system,

in genome-wide association studies.

PsO Treatments and Limitations

patients with mild PsO typically rely on topical corticosteroids or oral therapies like Otezla (apremilast), these agents often do not

provide an adequate response for patients with moderate-to-severe PsO.

As a result, the American Academy of Dermatology-National

Psoriasis Foundation recommends biologics as first-line therapy for moderate-to-severe PsO.

classes of biologic therapies have been approved for PsO over the past 20 years, resulting in progressively more complete symptom

Efficacy in PsO is typically measured via the PASI scoring system.

The first biologics approved for PsO were tumor necrosis alpha

(“TNF-α”) inhibitors such as Enbrel (etanercept), Humira (adalimumab), and Remicade (infliximab), which achieved a

PASI score of PASI 90 at 16 weeks in around 25 – 50% of patients and a PASI score of PASI 100 in around

5 – 20% of patients.

Stelara (ustekinumab), which targets the p40 subunit of IL-23 that is shared with IL-12, was approved

next and achieved efficacy on par with Humira.

IL-17 inhibitors Cosentyx (secukinumab), Taltz (ixekizumab), and Siliq (brodalumab) followed

and achieved responses of PASI 90 in around 70% of patients and PASI 100 in around 40% of patients with some risk of certain

side effects such as oral candidiasis.

Most recently, IL-23p19 inhibitors such as Ilumya (tildrakizumab), Tremfya (guselkumab), and Skyrizi

(risankizumab) have achieved responses of PASI 90 in around 70 – 80% of patients and PASI 100 in around 30 – 50%

of patients with highly tolerable profiles.

Finally, IL-17A/F inhibitors such as Bimzelx (bimekizumab) have recently shown even higher

response rates than IL-23 inhibitors, but with slightly less tolerable profiles.

expectations in PsO have evolved progressively with this continued innovation.

A 75% improvement in PASI score was previously thought

to be an adequate depth of response, and weekly SQ dosing was viewed as acceptable.

With each subsequent generation of innovation, patient

and caregiver expectations have advanced.

As discussed earlier, PsO

is a complex immune-mediated disease driven primarily by Th17 cells and the cytokines IL-23 and IL-17.

The interplay of environmental

and behavioral risk factors and genetics is believed to trigger PsO.

Multiple lines of evidence support a genetic component to the

disease, including the observation that approximately 40% of patients with PsO and PsA have a family history of the disease and the identification

of multiple susceptibility loci, many containing genes related to the regulation of the immune system, in genome-wide association studies.

Current PsO Treatments and Limitations

While patients with mild

PsO typically rely on topical corticosteroids or oral therapies like Otezla (apremilast), these agents often do not provide an adequate

response for patients with moderate-to-severe PsO.

As a result, the American Academy of Dermatology-National Psoriasis Foundation

recommends biologics as first-line therapy for moderate-to-severe PsO.

Several classes of biologic

therapies have been approved for PsO over the past 20 years, resulting in progressively more complete symptom relief.

PsO is typically measured via the PASI scoring system.

The first biologics approved for PsO were tumor necrosis alpha (“TNF-α”)

inhibitors such as Enbrel (etanercept), Humira (adalimumab), and Remicade (infliximab), which achieved a PASI score of PASI 90 at 16 weeks

in around 25 – 50% of patients and a PASI score of PASI 100 in around 5 – 20% of patients.

(ustekinumab), which targets the p40 subunit of IL-23 that is shared with IL-12, was approved next and achieved efficacy on par with Humira.

IL-17 inhibitors Cosentyx (secukinumab), Taltz (ixekizumab), and Siliq (brodalumab) followed and achieved responses of PASI 90 in around 70%

of patients and PASI 100 in around 40% of patients with some risk of certain side effects such as oral candidiasis.

Most recently,

IL-23p19 inhibitors such as Ilumya (tildrakizumab), Tremfya (guselkumab), and Skyrizi (risankizumab) have achieved responses of PASI 90

in around 70 – 80% of patients and PASI 100 in around 30 – 50% of patients with highly tolerable

Finally, IL-17A/F inhibitors such as Bimzelx (bimekizumab) have recently shown even higher response rates than IL-23 inhibitors,

but with slightly less tolerable profiles.

Treatment expectations in

PsO have evolved progressively with this continued innovation.

A 75% improvement in PASI score was previously thought to be an adequate

depth of response, and weekly SQ dosing was viewed as acceptable.

With each subsequent generation of innovation, patient and caregiver

expectations have advanced.

Today, Skyrizi (risankizumab) is widely viewed as the leader in PsO biologic therapy.

clinical trials, 43% and 58% of patients achieved PASI 100 at 16 and 52 weeks, respectively, with SQ maintenance dosing every three months.

In Phase 3 clinical

trials, 43% and 58% of patients achieved PASI 100 at 16 and 52 weeks, respectively, with SQ maintenance dosing every three months.

Most recently, Bimzelx (bimekizumab) has shown evidence of efficacy that exceeds even Skyrizi, achieving a 64% PASI 100 rate at 16 weeks

13 unchanged sentences

dosing regimens.

of Psoriatic Arthritis (PsA)

is a chronic inflammatory condition that affects both the skin and joints, and often coexists with PsO.

Around a quarter to a third

of patients with moderate-to-severe PsO also have PsA.

Most individuals develop PsO before being diagnosed with PsA, with a median

gap of seven to eight years between the diagnosis of skin and joint disease, though in up to 30% of patients with PsA, joint symptoms

appear before or simultaneously with skin manifestations.

Patients with PsA present with joint pain, stiffness, and swelling affecting

the peripheral joints, axial skeleton, or both.

Overview of Hidradenitis Suppurativa (“HS”)

HS is a chronic inflammatory

skin disease characterized by deep-seated nodules and abscesses, draining sinus tracts, and fibrotic scarring that most commonly occur

in intertriginous areas, such as the axillae and groin.

Due to the associated pain, sensitive anatomical locations, drainage, odor, scarring,

and recurrent disease flares, HS can have a substantial negative psychosocial impact across many areas of life, including interpersonal

relationships, education, and employment.

HS is believed to be underdiagnosed

and may have a prevalence exceeding 1% worldwide.

Significant delays between symptom onset and diagnosis are common;

an average delay

of 7–10 years has been reported, with some patients waiting more than 20 years for diagnosis.

This compares to an average time to

diagnosis of approximately 1.6 years for psoriasis.

Delayed diagnosis has been associated with worsening disease severity, progression,

and an increased burden of comorbidities, potentially due to delays in receiving appropriate anti-inflammatory treatment.

Current HS Treatments and Limitations

The overall treatment goals

for HS include alleviating lesion-related symptoms (e.g., pain), reducing the frequency and severity of disease flares, limiting the formation

of new inflammatory lesions, and preventing disease progression and associated comorbidities.

Treatment varies depending on disease severity

and may include topical and systemic antibiotics, hormone therapy, immunomodulators, and surgical interventions.

Humira (adalimumab) was

the only FDA-approved medication for the treatment of moderate-to-severe HS from its approval in 2015 until the approval of Cosentyx (secukinumab)

in October 2023 and Bimzelx (bimekizumab) in November 2024.

The hidradenitis suppurativa

clinical response (HiSCR) outcome measure is currently considered the standard primary endpoint for the assessment of new pharmacologic

interventions in HS clinical trials.

HiSCR50, HiSCR75, and HiSCR90 are defined as at least a 50%, 75%, or 90% reduction from baseline

in the total abscess and inflammatory nodule count, with no increase from baseline in abscess or draining tunnel count.

A recent network

meta-analysis comparing approved biologics for moderate-to-severe HS found that Bimzelx (bimekizumab) ranked highest across HiSCR efficacy

In Phase 3 studies, Bimzelx (bimekizumab) demonstrated placebo-adjusted HiSCR50/75 rates of 18–20%, and 15–20%,

respectively, at Week 16 with Q2W dosing.

In addition to currently

approved therapies, multiple biologic and oral agents targeting a range of inflammatory pathways are advancing through clinical development

These investigational therapies span diverse mechanisms of action and several have demonstrated encouraging efficacy signals in

Phase 2 clinical trials.

However, currently approved therapies and late-stage investigational agents are typically administered on weekly,

bi-weekly, or monthly dosing schedules, and a substantial proportion of patients continue to experience inadequate or incomplete disease

These factors underscore the ongoing unmet need for more effective, durable, and more conveniently administered treatment options.

Overview of Psoriatic Arthritis (PsA)

PsA is a chronic inflammatory

condition that affects both the skin and joints, and often coexists with PsO.

Around a quarter to a third of patients with moderate-to-severe

PsO also have PsA.

Most individuals develop PsO before being diagnosed with PsA, with a median gap of seven to eight years between

the diagnosis of skin and joint disease, though in up to 30% of patients with PsA, joint symptoms appear before or simultaneously with

skin manifestations.

Patients with PsA present with joint pain, stiffness, and swelling affecting the peripheral joints, axial skeleton,

Enthesitis, dactylitis, nail lesions, fatigue, and ocular inflammation all occur commonly.

PsA can lead to irreversible joint damage, including bony fusion across a joint (ankylosis).

The pathogenesis of PsA is likely to be

closely related to the mechanisms that underlie PsO.

Like PsO, the exact cause of PsA remains unknown, but environmental triggers,

including infection and trauma, and genetic factors play a role.

PsA Treatments and Limitations

treatment of PsA requires a coordinated approach to address the unique combination of disease manifestations each patient has, which

can include peripheral and axial arthritis, enthesitis, dactylitis, and skin and nail involvement.

Many patients with milder disease

symptoms will start with nonsteroidal anti-inflammatory drugs (“NSAIDs”) and/or local treatments to address specific disease

manifestations.

However, those with more moderate or severe disease and/or multidomain involvement will typically receive a biologic

therapy targeting TNF-α or IL-17, or less commonly an oral Janus kinase (“JAK”) inhibitor.

Comorbid conditions can

also influence treatment selection.

For example, an IL-17 inhibitor would be preferred for a patient with significant skin involvement,

but not for patients with IBD or ocular symptoms, where a TNF-α inhibitor would be preferred.

The most common endpoint used to

measure the efficacy of TNF-α or IL-17 inhibitors in PsA is ACR response, or the proportion of patients achieving a specified percent

improvement in American College of Rheumatology (“ACR”) score, which measures peripheral joint disease.

Approved TNF-α

inhibitors, including Humira (adalimumab) and Cimzia (certolizumab), achieved a placebo-adjusted ACR50 response of around 30 – 35%

at 24 weeks with Q2W dosing.

Approved IL-17 inhibitors, including Cosentyx (secukinumab) and Taltz (ixekizumab), achieved a slightly

lower placebo-adjusted ACR50 response of around 25 – 30% at 24 weeks, but with more convenient Q4W dosing.

Bimzelx (bimekizumab), which was recently approved in the United States for PsA, achieved a placebo-adjusted ACR50 response of approximately

35% at 16 weeks with Q4W dosing.

A significant fraction of patients with PsA still do not achieve a satisfactory response with available

therapies, and even the most convenient regimens require monthly SQ dosing.

of additional opportunities

addition to PsO and PsA, inhibition of IL-23 or IL-17 has demonstrated efficacy in a number of additional I&I indications, including

HS and axSpA.

is a chronic inflammatory skin disease characterized by lesions that include deep-seated nodules and abscesses, draining tracts, and

fibrotic scars that occur most commonly in intertriginous areas, such as the armpits and groin.

Due to the associated pain, sensitive

locations, drainage, odor, and scarring, this condition can have a particularly negative psychosocial impact on affected individuals.

HS is believed to be underdiagnosed and could have a prevalence well above 1% worldwide.

Treatment varies depending on severity and can

include topical and systemic antibiotics, hormone therapy, immune modulators, and surgery.

Humira (adalimumab) was the only FDA-approved

medication for the treatment of moderate-to-severe HS from its approval in 2015 until the approval of Cosentyx (secukinumab) in October 2023

and Bimzelx (bimekizumab) in November 2024.

Now multiple other biologics are advancing through development and have demonstrated encouraging

data in Phase 2 clinical trials, though a significant fraction of patients still do not achieve adequate responses.

is a chronic inflammatory disease that primarily affects the spine and sacroiliac joints that comprise the axial skeleton.

causes severe pain, stiffness, and fatigue, and can have additional clinical manifestations like uveitis, enthesitis, peripheral arthritis,

Patients with axSpA may develop further structural damage in their spine, which can lead to the fusion of vertebra (spinal

ankylosis), which has a massive negative impact on mobility, physical function, and quality of life.

The overall prevalence of axSpA

is estimated to be around 1% in the United States.

PsA can lead to irreversible joint

damage, including bony fusion across a joint (ankylosis).

The pathogenesis of PsA is likely to be closely related to the mechanisms that

underlie PsO.

Like PsO, the exact cause of PsA remains unknown, but environmental triggers, including infection and trauma, and genetic

factors play a role.

Current PsA Treatments and Limitations

Effective treatment of PsA

requires a coordinated approach to address the unique combination of disease manifestations each patient has, which can include peripheral

and axial arthritis, enthesitis, dactylitis, and skin and nail involvement.

Many patients with milder disease symptoms will start with

nonsteroidal anti-inflammatory drugs (“NSAIDs”) and/or local treatments to address specific disease manifestations.

those with more moderate or severe disease and/or multidomain involvement will typically receive a biologic therapy targeting TNF-α

or IL-17, or less commonly an oral Janus kinase (“JAK”) inhibitor.

Comorbid conditions can also influence treatment selection.

For example, an IL-17 inhibitor would be preferred for a patient with significant skin involvement, but not for patients with IBD or ocular

symptoms, where a TNF-α inhibitor would be preferred.

The most common endpoint used to measure the efficacy of TNF-α or IL-17

inhibitors in PsA is ACR response, or the proportion of patients achieving a specified percent improvement in American College of Rheumatology

(“ACR”) score, which measures peripheral joint disease.

Approved TNF-α inhibitors, including Humira (adalimumab) and

Cimzia (certolizumab), achieved a placebo-adjusted ACR50 response of around 30 – 35% at 24 weeks with Q2W dosing.

Approved IL-17 inhibitors, including Cosentyx (secukinumab) and Taltz (ixekizumab), achieved a slightly lower placebo-adjusted ACR50 response

of around 25 – 30% at 24 weeks, but with more convenient Q4W dosing.

Bimzelx (bimekizumab), which was recently

approved in the United States for PsA, achieved a placebo-adjusted ACR50 response of approximately 35% at 16 weeks with Q4W

A significant fraction of patients with PsA still do not achieve a satisfactory response with available therapies, and even the

most convenient regimens require monthly SQ dosing.

Overview of additional opportunities

In addition to PsO, HS, and PsA, inhibition of IL-23 or IL-17 has demonstrated

efficacy in a number of additional I&I indications, such as axSpA.

axSpA is a chronic inflammatory

disease that primarily affects the spine and sacroiliac joints that comprise the axial skeleton.

The disease causes severe pain, stiffness,

and fatigue, and can have additional clinical manifestations like uveitis, enthesitis, peripheral arthritis, and PsO.

Patients with

axSpA may develop further structural damage in their spine, which can lead to the fusion of vertebra (spinal ankylosis), which has a massive

negative impact on mobility, physical function, and quality of life.

The overall prevalence of axSpA is estimated to be around 1% in the

United States.

Treatment of axSpA starts with physical therapy and NSAIDs.

If patients do not

have an adequate response to NSAIDs, a TNF-α inhibitor is typically used, followed by an IL-17 inhibitor, such as Cosentyx (secukinumab),

Taltz (ixekizumab), or Bimzelx (bimekizumab), or less frequently a JAK inhibitor.

Patients often need to cycle through therapies over

time due to inadequate responses or loss of response.

Half-Life Extension and Antibody Engineering Technologies

antibody engineering campaigns are designed to optimize multiple attributes in parallel:

binding affinity, potency in a variety of assays,

developability, and consistently extended serum half-life in non-human primates (“NHPs”).

Half-life extension is possible

by modifying the pH-dependent binding affinity of the antibody Fc domain for FcRn.

A primary mechanism of elimination of antibodies from

the serum is through pinocytosis and degradation in the lysosomes of cells.

Throughout this process, antibodies can be recycled back

into the serum by binding to FcRn while they are in endosomes.

The interior of the endosome is acidic, and therefore the efficiency of

this recycling process depends on the ability of the antibody Fc domain to bind to FcRn at low pH.

If this low pH binding is efficient

enough, antibody recycling can be favored over degradation, potentially resulting in a much longer serum half-life.

engineers have discovered methods of modifying the Fc domain to optimize the efficiency of recycling via FcRn binding.

Several engineering

strategies have been identified over the past two decades, with the so-called “YTE” mutations (M252Y/S254T/T256E) and “LS”

mutations (M428L/N434S) being the most frequently used.

Importantly, while these strategies have been known for some time, it was only

relatively recently that enough clinical precedent was established to provide confidence in how these mutations perform in humans.

products incorporating YTE modification were approved in 2023 by the FDA, Beyfortus (nirsevimab) and Evusheld (tixagevimab and cilgavimab),

and several more candidates are in clinical trials.

Two products using LS mutations were approved in 2021 and 2022, Xevudy (sotrovima)

and Ultomiris (ravulizumab), respectively, and several more candidates are in clinical trials.

Based on clinical data in humans, antibodies

with YTE mutations typically have a half-life that is two to four times longer than wildtype antibodies.

In addition, preclinical data

in NHPs can be used to predict the approximate half-life in humans, with the human half-life equaling around two to four times the

NHP half-life.

experience with YTE-modified mAbs predicts significant half-life extension over wildtype mAbs

this increasing body of clinical precedent serves to validate half-life extension, we do not yet have clinical data showing that the

introduction of these amino acid substitutions in our programs leads to a longer serum half-life.

However, we aim to establish this favorable

pharmacokinetic profile early in the clinical development of our product candidates.

is a high affinity, extended half-life mAb designed to target the p19 subunit of IL-23.

Based on preclinical data generated to date,

we believe ORKA-001 has the potential to become the leading IL-23 inhibitor and achieve an optimal product profile in PsO consisting

of the following:

to two maintenance doses per year.

Standard-of-care therapies

targeting IL-23 require maintenance dosing every eight to twelve weeks.

We engineered

the Fc portion of ORKA-001 to include YTE mutations to increase the half-life of ORKA-001

in circulation, which may enable dosing every six to twelve months — a

dosing interval made feasible by half-life extension technology.

In preclinical studies,

serum levels from NHPs indicated an elimination half-life of over 30 days following

SQ administration of ORKA-001.

Based on published scientific literature on other antibodies

incorporating YTE mutations and pharmacokinetic modeling, we anticipate this half-life in

NHPs to translate to a half-life in humans that could allow subcutaneous dosing every six

to twelve months while maintaining high antibody exposures.

ORKA-001 benefits from the robust validation of

IL-23 inhibition in PsO by multiple approved therapies, such as Skyrizi (risankizumab) and

Tremfya (guselkumab), while leveraging insights from these therapies to improve upon their

clinical profile.

ORKA-001 is designed to bind a similar epitope to the market-leading anti-IL-23

antibody, Skyrizi, with similar or greater affinity and could achieve much higher exposures

in patients due to half-life extension and higher dosing.

Skyrizi and Tremfya both have a

robust exposure-response relationship, with higher drug exposures leading to higher response

Published data indicates that these therapies have not saturated this exposure-response

relationship, and ORKA-001 could lead to higher response rates, including higher rates of

complete skin clearance, or PASI 100, through increased exposure, even while having more

convenient dosing with as few as one or two maintenance doses per year.

If patients do not have an adequate response to NSAIDs,

a TNF-α inhibitor is typically used, followed by an IL-17 inhibitor, such as Cosentyx (secukinumab), Taltz (ixekizumab), or Bimzelx

(bimekizumab), or less frequently a JAK inhibitor.

Patients often need to cycle through therapies over time due to inadequate responses

or loss of response.

Our Solution:

Half-Life Extension and Antibody

Engineering Technologies

Our antibody engineering

campaigns are designed to optimize multiple attributes in parallel:

binding affinity, potency in a variety of assays, developability,

and consistently extended serum half-life in non-human primates (“NHPs”).

Half-life extension is possible by modifying the

pH-dependent binding affinity of the antibody Fc domain for FcRn.

A primary mechanism of elimination of antibodies from the serum is through

pinocytosis and degradation in the lysosomes of cells.

Throughout this process, antibodies can be recycled back into the serum by binding

to FcRn while they are in endosomes.

The interior of the endosome is acidic, and therefore the efficiency of this recycling process depends

on the ability of the antibody Fc domain to bind to FcRn at low pH.

If this low pH binding is efficient enough, antibody recycling

can be favored over degradation, potentially resulting in a much longer serum half-life.

Antibody engineers have discovered methods of modifying the Fc domain

to optimize the efficiency of recycling via FcRn binding.

Several engineering strategies have been identified over the past two decades,

with the so-called “YTE” mutations (M252Y/S254T/T256E) and “LS” mutations (M428L/N434S) being the most frequently

Importantly, while these strategies have been known for some time, it was only relatively recently that enough clinical precedent

was established to provide confidence in how these mutations perform in humans.

Three products incorporating YTE or LS modifications are

currently approved by the FDA, Beyfortus (nirsevimab), Exdensur (depemokimab), and Ultomiris (ravulizumab), and several more candidates

are in clinical trials.

Based on clinical data in humans, antibodies with YTE mutations typically have a half-life that is two to four

times longer than wildtype antibodies.

ORKA-001 is a high affinity,

extended half-life mAb designed to target the p19 subunit of IL-23.

Based on both preclinical and clinical data generated to date, we

believe ORKA-001 has the potential to become the leading IL-23 inhibitor and achieve an optimal product profile in PsO consisting of the

One to two maintenance doses per year.

Standard-of-care therapies targeting IL-23 require maintenance dosing every eight to twelve weeks.

We engineered the Fc portion of ORKA-001 to include YTE mutations to increase the half-life of ORKA-001 in circulation, which may enable dosing every six to twelve months — a dosing interval made feasible by half-life extension technology.

In clinical studies, ORKA-001 demonstrated a human half-life of approximately 100 days.

Based on pharmacokinetic modeling, we anticipate

this half-life to enable subcutaneous dosing every six to twelve months while maintaining high antibody exposures.

ORKA-001 benefits from the robust validation of IL-23 inhibition in PsO by multiple approved therapies, such as Skyrizi

(risankizumab) and Tremfya (guselkumab), while leveraging insights from these therapies to improve upon their clinical profile.

is designed to bind a similar epitope to the market-leading anti-IL-23 antibody, Skyrizi, with similar affinity and could

achieve much higher exposures in patients due to half-life extension and higher dosing.

Skyrizi and Tremfya both have a robust exposure-response

relationship, with higher drug exposures leading to higher response rates.

Published data indicates that these therapies have not saturated

this exposure-response relationship, and ORKA-001 could lead to higher response rates, including higher rates of complete skin clearance,

or PASI 100, through increased exposure, even while having more convenient dosing with as few as one or two maintenance doses per year.

IL-23p19 safety profile.

Existing commercially approved antibodies

targeting IL-23 provide a robust precedent for the safety of IL-23 inhibition.

Across thousands

of patients dosed in dermatology and IBD indications, no correlations have been observed

at the patient level between exposure and safety.

While we are not pursuing IBD, the approved

Skyrizi regimens for Crohn’s disease and ulcerative colitis supports the safety of

high peak exposures.

Existing commercially approved antibodies targeting IL-23 provide a robust precedent for the safety

of IL-23 inhibition.

Across thousands of patients dosed in dermatology and IBD indications, no correlations have been observed at the

patient level between exposure and safety.

While we are not pursuing IBD, the approved Skyrizi regimens for Crohn’s disease and

ulcerative colitis supports the safety of high peak exposures.

Peak Skyrizi exposures during the IV induction phase in Crohn’s

disease and ulcerative colitis are multiple times higher than the anticipated peak ORKA-001

exposures at dose levels we currently plan to evaluate in PsO.

In addition, an exposure-response

analysis for Skyrizi in ulcerative colitis showed no relationship between exposures and evaluated

safety endpoints in the 12-week induction or 52-week maintenance periods.

In this assessment,

the top quartile of average exposures were significantly higher than the highest anticipated

exposures with ORKA-001 in the same periods.

disease and ulcerative colitis are multiple times higher than the anticipated peak ORKA-001 exposures at dose levels we plan

to evaluate in PsO.

In addition, an exposure-response analysis for Skyrizi in ulcerative colitis showed no relationship between

exposures and evaluated safety endpoints in the 12-week induction or 52-week maintenance periods.

In this assessment, the top quartile

of average exposures was significantly higher than the highest anticipated exposures with ORKA-001 in the same periods.

to offer longer term remission to some patients.

evidence suggests that IL-23 blockade can modify the disease biology of PsO, possibly leading

to durable remissions and preventing the development of PsA.

Andrew Blauvelt,

chair of our Scientific Advisory Board, pioneered some of this work by using two- and four-times

the approved dose levels of risankizumab to achieve best-in-indication response rates.

study, called KNOCKOUT, showed a robust depletion of TRMs following high dose IL-23 inhibition,

which could lead to longer-lasting remissions in some patients.

Additional evidence from

a study of guselkumab, called GUIDE, showed that intervention early in the disease course

can lead to longer treatment-free remissions.

In addition, retrospective claims data suggests

that treatment with an IL-23 inhibitor could help prevent progression to PsA, though this

finding has yet to be confirmed by a prospective clinical trial.

Given the high antibody

exposures expected with ORKA-001, we believe that ORKA-001 could lead to durable remissions

for some patients, especially those with short disease duration.

We plan to pursue patient-specific

dosing intervals to provide each patient the greatest possible freedom from their disease.

believe that this target profile for ORKA-001 could offer improved freedom from disease to many patients affected by PsO and represent

a step forward in the standard of care.

evaluated ORKA-001 in numerous preclinical studies for several key features:

that matches or exceeds Skyrizi (risankizumab) in vitro

have tested the potency of ORKA-001 in vitro in multiple assays, including assays evaluating the inhibition of IL-17 release from

human peripheral mononuclear blood cells, in comparison to risankizumab generated recombinantly based on amino acid sequences from patent

Based on the results of these experiments, we believe ORKA-001 binds a similar epitope as risankizumab with similar potency.

binds to a similar epitope as risankizumab with similar potency

half-life extension in NHPs that could enable a maintenance dosing interval of once or twice a year in humans

assessed ORKA-001 in NHPs in comparison to risankizumab generated recombinantly based on amino acid sequences from patent filings.

had a significantly longer half-life, reaching over 30 days with SQ administration.

Based on clinical experience with YTE-modified

mAbs and pharmacokinetic modeling, we believe that this half-life extension could enable dosing once or twice per year, as shown in the

figure below.

incorporation of YTE mutations significantly extends half-life in NHPs, which could enable once or twice yearly dosing

addition to enabling less frequent dosing, an extended half-life would increase the exposure of ORKA-001, which has the potential to

increase efficacy.

Based on published literature, Skyrizi (risankizumab) demonstrates a clear relationship between antibody exposure

and efficacy, with higher average serum antibody concentration correlating with higher PASI 90 and PASI 100 rates short-term (at 16 weeks)

and long-term (at 52 weeks), as shown for PASI 100 in the figure below.

In addition, the KNOCKOUT study, which evaluated two- and

four-times higher doses of Skyrizi than the approved regimen, yielded some of the highest PASI 100 rates observed to date, reaching 67%

Based on our pharmacokinetic modeling, ORKA-001 could achieve four-fold higher average exposures than the approved

Skyrizi regimen over the first 16 weeks and over two-fold higher average exposures at steady-state, exceeding even the exposures

Based on the exposure-response relationship observed with other IL-23 inhibiting antibodies, we believe that these

increased exposures could result in higher efficacy.

is projected to extend the exposure-response relationship established by studies of Skyrizi

in vitro and in vivo

have evaluated ORKA-001 in several in vitro and in vivo preclinical studies to assess safety.

In addition, we have

a nonclinical program to characterize the toxicology, toxicokinetics, and anti-drug antibody profile of ORKA-001 in NHPs.

Our nonclinical

program supported the initiation of our Phase 1 clinical trial for ORKA-001 and our continuing clinical development.

Characteristics

that support ease of manufacturing and potentially enable high-concentration formulations

we have assessed a variety of attributes essential for manufacturability and high-concentration formulation, including viscosity, solubility,

and stability, among others.

ORKA-001 shows evidence of desirable properties across these characteristics, which we believe will enhance

our ability to manufacture ORKA-001 successfully and consistently and to deliver high doses of ORKA-001 subcutaneously using convenient,

low-volume presentations.

dosed the first participants in a Phase 1 clinical trial of ORKA-001 in healthy volunteers in the fourth quarter of 2024.

is a double-blind, placebo-controlled, single ascending dose study evaluating the safety, tolerability, and pharmacokinetics of ORKA-001

Emerging evidence suggests that IL-23 blockade can modify the disease biology

of PsO, possibly leading to durable remissions and preventing the development of PsA.

Andrew Blauvelt, chair of our Scientific

Advisory Board, pioneered some of this work by using two- and four-times the approved dose levels of risankizumab to achieve best-in-indication

response rates.

This study, called KNOCKOUT, showed a robust depletion of TRMs following high dose IL-23 inhibition, which could lead

to longer-lasting remissions in some patients.

Additional evidence from a study of guselkumab, called GUIDE, showed that intervention

early in the disease course can lead to longer treatment-free remissions.

In addition, retrospective claims data suggests that treatment

with an IL-23 inhibitor could help prevent progression to PsA, though this finding has yet to be confirmed by a prospective clinical

Given the high antibody exposures expected with ORKA-001, we believe that ORKA-001 could lead to durable remissions for some patients,

especially those with short disease duration.

We plan to pursue patient-specific dosing intervals to provide each patient the greatest

possible freedom from their disease.

We believe that this target

profile for ORKA-001 could offer improved freedom from disease to many patients affected by PsO and represent a step forward in the standard

Clinical Development

We dosed the first

participants in a Phase 1 clinical trial of ORKA-001 in healthy volunteers in the fourth quarter of 2024.

This trial is a

double-blind, placebo-controlled, single ascending dose study evaluating the safety, tolerability, and pharmacokinetics of ORKA-001

in healthy volunteers.

The trial is expected to enroll approximately 24 healthy volunteers across three subcutaneous dose cohorts.

expect to share interim data from this trial in the second half of 2025.

We believe this data has the potential to provide key validation

of initial safety and pharmacokinetics data, including half-life, to support extended dosing intervals.

plan to initiate a Phase 2a proof-of-concept study of ORKA-001 in moderate-to-severe PsO in the second half of 2025.

We believe that

several aspects of PsO facilitate clinical development, including well-established, reproducible endpoints based on PASI scores, low

placebo rates, particularly with PASI 90 and PASI 100, a rapid efficacy readout at 16 weeks, and potentially rapid enrollment due to

the large patient population.

Our Phase 2a clinical trial is anticipated to evaluate the safety and efficacy of a single dose level of

ORKA-001 versus placebo in approximately 80 subjects, followed by randomization to one of two maintenance dosing arms.

In one maintenance

arm, subjects will receive ORKA-001 every six months.

In the other, subjects will receive only induction dosing to assess the length

of time patients maintain clear skin, which could support once-yearly dosing or even longer-term durability in some patients.

The anticipated

primary endpoint is PASI 100 at Week 16.

After completing the trial, subjects may have the option to roll over to an open-label extension

We expect to share initial data from the Phase 2a trial in the second half of 2026.

We believe this data has the potential to

inform efficacy at Week 16, as well as later timepoints, and provide us information on preliminary durability, including the potential

for extended dosing intervals and longer-term remissions.

is a high affinity, extended half-life mAb designed to target IL-17A/F.

Dual inhibition of both IL-17A and IL-17F has shown superior

efficacy compared to IL-17A inhibition alone in PsO and other indications, as shown by the performance of Bimzelx (bimekizumab) compared

to Cosentyx (secukinumab) and Taltz (ixekizumab) in Phase 3 trials.

These therapies all utilize Q4W maintenance dosing in PsO and

PsA, except Bimzelx, where Q8W maintenance dosing in PsO patients <120 kg is recommended.

By binding IL-17A/F at similar epitopes

and affinity ranges as Bimzelx while incorporating half-life extension technology to potentially enable dosing two to three times a year

in PsO and PsA, we believe that ORKA-002 could become the leading therapy in the IL-17 class.

preclinical program we are conducting for ORKA-002 mirrors that for ORKA-001 and spans potency, pharmacokinetics, safety, and manufacturing

characteristics.

Based on the results of these experiments, we believe ORKA-002 has the potential for comparable potency to bimekizumab,

but with a significantly longer half-life, which we believe could support dosing two or three times per year based on extrapolation from

clinical precedent and pharmacokinetic modeling.

Development Plans

plan to initiate dosing of healthy volunteers in a Phase 1 trial of ORKA-002 in the third quarter of 2025.

As with ORKA-001, initial

data on ORKA-002 in healthy volunteers has the potential to provide key validation of both early safety and pharmacokinetics to support

extended dosing intervals.

Though clinical development of ORKA-002 will initially focus on one lead indication, we plan to evaluate ORKA-002

in a range of indications over time.

We see ORKA-002 as highly complementary to ORKA-001, with the potential to provide an optimal therapy

for the approximately one-quarter to one-third of moderate-to-severe PsO patients who have PsA, as well as for PsO patients with highly

resistant skin symptoms that do not respond adequately to an IL-23 inhibitor.

Furthermore, ORKA-002 could address indications beyond

PsO, including PsA with limited skin involvement, HS, axSpA, and additional I&I diseases.

IL-17 and IL-23 classes each have distinct advantages.

IL-17 inhibitors tend to have the fastest onset and highest peak response, while

IL-23 inhibitors have less frequent dosing and better durability and safety.

Combining the two mechanisms sequentially has the potential

to provide two attractive features of each program:

the rapid response of an IL-17 inhibitor with the ideal maintenance profile of an

IL-23 inhibitor.

As a result, following ORKA-002 and ORKA-001, we plan to explore a sequential combination regimen of ORKA-002 and ORKA-001,

called “ORKA-021.”

Pipeline Program

have a third mAb program, ORKA-003, that targets an undisclosed pathway.

A core tenet of our strategy is to remain highly focused on I&I

diseases, and specifically on inflammatory dermatology conditions.

ORKA-003 provides the potential for indication expansion beyond PsO

as well as combination opportunities with our more advanced programs.

In the future, we may add additional programs to our portfolio

beyond ORKA-001, ORKA-002, ORKA-021 and ORKA-003 that fit our strategic focus.

strive to protect the proprietary programs and technologies that we believe are important to our business, including seeking and maintaining

patent protection intended to cover the composition of matter of our programs, their methods of use and manufacture, related technologies,

diagnostics, and other inventions.

has filed, on our behalf, provisional patent applications, and we have filed non-provisional patent applications, and may file additional

patent applications directed to antibodies that target IL-23, including applications covering composition of matter, pharmaceutical formulations,

and methods of using such antibodies, including ORKA-001.

In addition, Paragon has filed, on our behalf, provisional patent applications,

and we may file additional patent applications directed to antibodies that target IL-17, including applications covering composition

of matter, pharmaceutical formulations, and methods of using such antibodies, including ORKA-002.

We have exclusive rights to ORKA-001

and ORKA-002 and the corresponding IL-23 and IL-17 patent applications pursuant to license agreements with Paragon.

If the patent applications

mature into one or more issued patents covering ORKA-001 or ORKA-002, we would expect those patents to expire in 2045, absent any applicable

patent term adjustments or extensions.

any of our product candidates be approved for commercialization, we intend to develop a plan to commercialize them in the United States

and other key markets, through internal infrastructure and/or external partnerships in a manner that will enable us to realize the full

commercial value of our programs.

Given our stage of development, we have not yet established a commercial organization or distribution

capabilities.

We have exclusive worldwide rights to develop and commercialize ORKA-001 and ORKA-002 pursuant to license agreements with

The trial enrolled 24 healthy adult participants into three single ascending subcutaneous dose cohorts of 300

mg, 600 mg, and 1200 mg.

In September 2025, we announced the interim results at the European Academy of Dermatology and Venereology

(EADV) Congress.

The data showed that ORKA-001 has a human half-life of approximately 100 days.

Single doses of ORKA-001

demonstrated complete and sustained inhibition of STAT3 signaling, a downstream marker of IL-23 activity, in an ex vivo assay

through 24 weeks.

In addition, ORKA-001 was well tolerated at all dose levels, with a favorable safety profile consistent with the

anti-IL-23 class.

We believe this data supports the key ways in which ORKA-001 could re-define the treatment paradigm in psoriasis:

annual dosing, higher efficacy, and off-treatment remission.

ORKA-001 showed a human half-life of

approximately 100 days

In the third quarter of 2025, we commenced dosing in a Phase 2a proof-of-concept study of ORKA-001 in moderate-to-severe PsO (also known

as “EVERLAST-A”).

We expect to share Week 16 data for all patients in the second quarter of 2026.

In addition, we plan to

share longer-term data, including Week 28 for all patients and 52-week follow-up for a portion of the cohort in the second half of 2026.

EVERLAST-A enrolled 84 patients randomized 3:1 to receive 600 mg of ORKA-001 at Weeks 0 and 4 or matching placebo.

The primary endpoint

is PASI 100 at Week 16.

At Week 28, patients who have achieved PASI 100 will be randomized 2:1 to an arm where either (1) they do not

receive another dose until disease recurrence (to evaluate the possibility of both yearly dosing and extended off-treatment remissions)

or (2) they receive 300 mg ORKA-001 every six months.

Patients who have not achieved PASI 100 will receive a 300 mg dose every six months.

After completing the trial, subjects may have the option to roll over to an open-label extension study.

Additionally, the first

patients were dosed in the EVERLAST-B trial in December 2025.

EVERLAST-B is designed to enroll approximately 160 patients, is a

dose-ranging Phase 2b trial of ORKA-001 in moderate-to-severe PsO patients and will evaluate three dose levels of ORKA-001:

at Week 0, 300 mg at Weeks 0 and 4, and 600 mg at Weeks 0 and 4, versus placebo.

The primary endpoint is PASI 100 at Week 16.

Week 28, patients who have achieved PASI 100 will be re-randomized 1:1 to either a 600 mg dose once-yearly or matching placebo.

Patients who have not achieved PASI 100 at Week 28 will receive a 300 mg dose every six months.

Building on EVERLAST-A, this design

will further test the potential for ORKA-001 to achieve yearly dosing, higher efficacy and extended off-treatment remissions.

from EVERLAST-B is anticipated in 2027.

ORKA-002 is a high affinity,

extended half-life mAb designed to target IL-17A/F.

Dual inhibition of both IL-17A and IL-17F has shown superior efficacy compared to

IL-17A inhibition alone in PsO and other indications, as shown by the performance of Bimzelx (bimekizumab) compared to Cosentyx (secukinumab)

and Taltz (ixekizumab) in Phase 3 trials.

These therapies all utilize Q4W maintenance dosing in PsO and PsA, except Bimzelx, where Q8W

maintenance dosing in PsO patients <120 kg is recommended.

By binding IL-17A/F at similar epitopes and affinity ranges as Bimzelx while

incorporating half-life extension technology to potentially enable twice-yearly maintenance dosing in PsO and quarterly maintenance dosing

in HS, we believe that ORKA-002 could become the leading therapy in the IL-17 class.

Clinical Development

In January 2026, we announced

interim findings from the Phase 1 trial of ORKA-002 in healthy volunteers.

The study enrolled 24 healthy adult participants into three

single-ascending subcutaneous dose cohorts of 160 mg, 320 mg and 640 mg.

ORKA-002 showed a half-life of approximately 75-80 days, greater

than three times that of bimekizumab, and a comparable Cmax to bimekizumab at equivalent doses based on previously reported bimekizumab

Pharmacokinetic modeling based on these results supports achieving twice-yearly maintenance dosing in PsO and quarterly maintenance

dosing in HS.

Additionally, single doses of ORKA-002 demonstrated potent and sustained inhibition of IL-17 signaling in an ex vivo

assay through 24 weeks.

ORKA-002 was well tolerated at all dose levels, with a favorable safety profile consistent with the anti-IL-17

The trial remains blinded, and as of January 6, 2026, which was the data cutoff date, all subjects remained on trial.

ORKA-002 showed a half-life of approximately

We initiated ORCA-SURGE,

a Phase 2 trial of ORKA-002 in patients with moderate-to-severe PsO, in February 2026.

ORCA-SURGE is designed to enroll approximately

160 patients randomized 1:1:1:1 to receive 40 mg, 160 mg or 320 mg of ORKA-002 at Weeks 0 and 4, or matching placebo.

The primary endpoint

is PASI 100 at Week 16.

Maintenance dosing will evaluate the potential for twice-yearly dosing with ORKA-002.

Data from ORCA-SURGE is

anticipated in 2027.

We see ORKA-002 as highly

complementary to ORKA-001, with the potential to provide an improved therapy for the approximately one-quarter to one-third of moderate-to-severe

PsO patients who have PsA, as well as for PsO patients with highly resistant skin symptoms that do not respond adequately to an IL-23

Furthermore, ORKA-002 could address indications beyond PsO, including PsA with limited skin involvement, HS, axSpA, and additional I&I

We plan to initiate a Phase 2 trial of ORKA-002 in patients with HS in the second half of 2026.

The IL-17 and IL-23 inhibitor

classes each have distinct advantages.

IL-17 inhibitors are generally associated with rapid onset of action and high peak response, while

IL-23 inhibitors are typically characterized by less frequent dosing and favorable durability and safety profiles.

Sequential use of these

two mechanisms has the potential to combine attractive attributes of each class, including the rapid response associated with IL-17 inhibition

and the maintenance profile associated with IL-23 inhibition.

Accordingly, following ORKA-002 and ORKA-001, we plan to evaluate a sequential

combination regimen of ORKA-002 and ORKA-001, which we refer to as “ORKA-021”.

Additional Pipeline Program

We have a third program, ORKA-003, that targets an undisclosed pathway.

A core tenet of our strategy is to remain highly focused on I&I diseases, and specifically on inflammatory dermatology conditions.

ORKA-003 provides the potential for indication expansion beyond PsO as well as combination opportunities with our more advanced programs.

In the future, we may add additional programs to our portfolio beyond ORKA-001, ORKA-002, ORKA-021 and ORKA-003 that fit our strategic

Intellectual Property

We seek to protect the proprietary programs and technologies that we

believe are important to our business through a combination of patent protection and other intellectual property strategies.

Our intellectual

property portfolio is designed to protect our product candidates and related technologies, including patents directed to composition of

matter, methods of use and manufacture, and other inventions.

We and Paragon have filed,

and may continue to file, patent applications relating to antibodies that target IL-23, including applications covering composition of

matter, pharmaceutical formulations, and methods of use, including for ORKA-001.

We and Paragon have also filed, and may continue to file,

patent applications relating to antibodies that target IL-17, including applications covering composition of matter, pharmaceutical formulations,

and methods of use, including for ORKA-002.

We hold exclusive rights to ORKA-001 and ORKA-002, as well as the associated

IL-23 and IL-17 patent rights, pursuant to license agreements with Paragon.

Certain patent rights covering ORKA-001 are expected to expire

in 2045, absent any applicable patent term adjustments or extensions.

Patent rights relating to ORKA-002, if issued, are also expected

to expire in 2045, absent any applicable patent term adjustments or extensions.

If any of our product candidates

are approved for commercialization, we intend to commercialize them in the United States and other key markets either independently or

through strategic collaborations, with the objective of maximizing the commercial value of our programs.

Given our current stage of development,

we have not yet established a commercial organization or distribution capabilities.

Pursuant to license agreements with Paragon, we hold

exclusive worldwide rights to develop and commercialize ORKA-001 and ORKA-002.

Manufacturing

do not currently own or operate facilities for product manufacturing, testing, storage, and distribution.

We have contracted and expect

to continue to contract with third parties for the manufacture and distribution of our product candidates.

Because we rely on contract

manufacturers, we employ personnel with extensive technical, manufacturing, analytical, and quality experience.

Our team has deep knowledge

and understanding of the regulations that govern manufacturing, documentation, quality assurance, and quality control of drug supply

that are required to support our regulatory filings.

biotechnology and biopharmaceutical industries are characterized by continuing technological advancement and significant competition.

While we believe that our programs, technology, development experience and scientific knowledge provide us with competitive advantages,

we face competition from major pharmaceutical and biotechnology companies, academic institutions, governmental agencies, and public and

private research institutions, among others.

Any product candidates that we successfully develop and commercialize will compete with

existing therapies and therapies that may become available in the future.

Many of the companies with which we are currently competing

or will compete against in the future have significantly greater financial resources and expertise in research and development, manufacturing,

preclinical testing, conducting clinical trials, obtaining regulatory approvals, and marketing approved products than we do.

and acquisitions in the pharmaceutical and biotechnology industry may result in even more resources being concentrated among a smaller

number of our competitors.

Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative

arrangements with large and established companies.

These competitors also compete with us in recruiting and retaining qualified scientific

and management personnel, establishing clinical trial sites, patient enrollment for clinical trials as well as in acquiring technologies

complementary to, or necessary for, our programs.

competitive factors affecting the success of all our product candidates that we develop, if approved, are likely to be efficacy, safety,

convenience, presentation, price, the level of generic competition, and the availability of reimbursement from government and other third-party

Our competitors may also obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval

for our products, which could result in our competitors establishing a strong market position before we are able to enter the market.

Specifically,

there are several companies developing or marketing treatments that may be approved for the same indications and/or diseases as our two

most advanced programs, ORKA-001 and ORKA-002, including major pharmaceutical companies.

We do not yet have clinical data for any of

our programs and there can be no assurance that our programs will have similar or comparable results.

are several approved biologic therapies for the treatment of moderate-to-severe PsO.

These include mAbs targeting IL-23, such as

Skyrizi (risankizumab) from AbbVie, Tremfya (guselkumab) from Janssen, and Ilumya (tildrakizumab) from Sun Pharma, also marketed as Ilumetri

by Almirall in Europe, which all target the p19 subunit, and Stelara (ustekinumab) from Janssen, which targets the p40 subunit;

targeting IL-17, such as Bimzelx (bimekizumab) from UCB, which targets IL-17A/F, Cosentyx (secukinumab) from Novartis and Taltz (ixekizumab)

from Eli Lilly, which both target IL-17A, and Siliq (brodalumab) from Ortho Dermatologics, also marketed as Kyntheum by LEO Pharma in

Europe, which targets IL-17 receptor/A;

and biologics targeting TNF-α, such as Humira (adalimumab) from AbbVie, Enbrel (etanercept)

from Amgen, and Remicade (infliximab) from Janssen, and various biosimilar versions of each.

In addition, there are several approved

oral medicines in these indications, including the phosphodiesterase-4 (PDE4) inhibitor Otezla (apremilast) from Amgen and the tyrosine

kinase 2 (TYK2) inhibitor Sotyktu (deucravacitinib) from Bristol-Myers Squibb.

Many of these therapies also are approved or in development

We do not currently own or

operate facilities for product manufacturing, testing, storage, and distribution.

We have contracted and expect to continue to contract

with third parties for the manufacture and distribution of our product candidates.

Because we rely on contract manufacturers, we employ

personnel with extensive technical, manufacturing, analytical, and quality experience.

Our team has deep knowledge and understanding of

the regulations that govern manufacturing, documentation, quality assurance, and quality control of drug supply that are required to support

our regulatory filings.

The biotechnology and biopharmaceutical

industries are characterized by continuing technological advancement and significant competition.

While we believe that our programs,

technology, development experience and scientific knowledge provide us with competitive advantages, we face competition from major pharmaceutical

and biotechnology companies, academic institutions, governmental agencies, and public and private research institutions, among others.

Any product candidates that we successfully develop and commercialize will compete with existing therapies and therapies that may become

available in the future.

Many of the companies with which we are currently competing or will compete against in the future have significantly

greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials,

obtaining regulatory approvals, and marketing approved products than we do.

Mergers and acquisitions in the pharmaceutical and biotechnology

industry may result in even more resources being concentrated among a smaller number of our competitors.

Smaller or early-stage companies

may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

competitors also compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical trial

sites, patient enrollment for clinical trials as well as in acquiring technologies complementary to, or necessary for, our programs.

Key competitive factors affecting

the success of all our product candidates that we develop, if approved, are likely to be efficacy, safety, convenience, presentation,

price, the level of generic competition, and the availability of reimbursement from government and other third-party payors.

Our competitors

may also obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for our products, which could

result in our competitors establishing a strong market position before we are able to enter the market.

Specifically, there are several

companies developing or marketing treatments that may be approved for the same indications and/or diseases as our two most advanced programs,

ORKA-001 and ORKA-002, including major pharmaceutical companies.

We have generated early-stage clinical data for certain programs, and

there can be no assurance that early clinical results will be predictive of later-stage outcomes.

There are several

approved biologic therapies for the treatment of moderate-to-severe PsO.

These include mAbs targeting IL-23, such as Skyrizi

(risankizumab) from AbbVie, Tremfya (guselkumab) from Janssen, Ilumya (tildrakizumab) from Sun Pharma, also marketed as Ilumetri by

Almirall in Europe, and Pecondle (picankibart) from Innovent Biologics, which has been approved in China, which all target the p19

subunit, and Stelara (ustekinumab) from Janssen, which targets the p40 subunit;

mAbs targeting IL-17, such as Bimzelx (bimekizumab)

from UCB, which targets IL-17A/F, Cosentyx (secukinumab) from Novartis and Taltz (ixekizumab) from Eli Lilly, which both target

IL-17A, and Siliq (brodalumab) from Ortho Dermatologics, also marketed as Kyntheum by LEO Pharma in Europe, which targets IL-17

and biologics targeting TNF-α, such as Humira (adalimumab) from AbbVie, Enbrel (etanercept) from Amgen, and

Remicade (infliximab) from Janssen, and various biosimilar versions of each.

In addition, there are several approved oral medicines

in these indications, including the phosphodiesterase-4 (PDE4) inhibitor Otezla (apremilast) from Amgen and the tyrosine kinase 2

(TYK2) inhibitor Sotyktu (deucravacitinib) from Bristol-Myers Squibb.

Many of these therapies are also approved or in development

for PsA, HS, axSpA, and other I&I indications.

addition, we are aware of several product candidates in clinical development for moderate-to-severe PsO, along with PsA, HS, axSpA, and

other indications.

These include the biologics picankibart from Innovent Biologics targeting IL-23p19 and sonelokimab from MoonLake Immunotherapeutics

targeting IL-17A/F.

Also, there are several oral agents in development, including JNJ-2113 from Janssen targeting the IL-23 receptor,

DC-853 from Eli Lilly targeting IL-17A, and TAK-279 from Takeda and ESK-001 from Alumis, both targeting TYK2.

Therapeutics – Option Agreements

In addition, we are aware

of several product candidates in clinical development for moderate-to-severe PsO, along with PsA, HS, axSpA, and other indications.

include the biologic sonelokimab from MoonLake Immunotherapeutics targeting IL-17A/F, and several oral agents in development, including

JNJ-2113 (icotrokinra) from Janssen targeting the IL-23 receptor, DC-853 (simepdekinra) from Eli Lilly targeting IL-17A, PN-881 from Protagonist

targeting IL-17A/F, and TAK-279 (zasocitinib) from Takeda and ESK-001 (envudeucitinib) from Alumis, both targeting TYK2.

AbbVie has also announced plans to initiate a Phase 1 clinical study of a long-acting IL-23p19 inhibitor

Significant Agreements

Paragon Therapeutics – Option Agreements

and License Agreements

In March 2024, we entered

into two antibody discovery and option agreements (“Option Agreements”) with Paragon and Paruka Holding, LLC (“Paruka”).

Paruka is an entity formed by Paragon as a vehicle to hold equity in our Company in order to share profits with certain employees of Paragon.

Under the terms of each agreement, Paragon identifies, evaluates, and develops antibodies directed against certain mutually agreed therapeutic

targets of interest to us.

From time to time, we can choose to add additional targets to the collaboration upon agreement with Paragon

Under the Option Agreements, we have the exclusive option to, on a research program-by-research program basis, be granted

an exclusive, worldwide license to all of Paragon’s right, title, and interest in and to the intellectual property resulting from

the applicable research program to develop, manufacture, and commercialize the antibodies and products directed to the selected target(s) (each,

an “Option”).

We have initiated certain research programs with Paragon that generally focus on discovering, generating, identifying

and/or characterizing antibodies directed to a particular target (each, a “Research Program”), including for IL-23 and IL-17A/F

for ORKA-001 and ORKA-002, respectively.

Our exclusive option with respect to each Research Program is exercisable at our sole discretion

at such time as specified in the Option Agreements (the “Option Period”).

There is no payment due upon exercise of an Option

pursuant to the Option Agreements.

For each of these agreements, once we enter into the corresponding license agreements, we will be required

to make non-refundable milestone payments to Paragon of up to $12.0 million under each respective agreement upon the achievement of certain

clinical development milestones, up to $10.0 million under each respective agreement upon the achievement of certain regulatory milestones,

as well as a low single-digit percentage royalty for antibody products beginning on the first commercial sale in each program.

may terminate any Option Agreement or any Research Program at any time for any or no reason

upon 30 days’ prior written notice to Paragon, provided that we must pay certain

unpaid fees due to Paragon upon such termination, as well as any non-cancellable obligations

reasonably incurred by Paragon in connection with its activities under any terminated Research

Paragon may terminate any Option Agreement or a Research Program immediately upon

written notice to us if, as a result of any action or failure to act by us or our affiliates,

such Research Program or all material activities under the applicable Research Plan are suspended,

discontinued or otherwise delayed for a certain consecutive number of months.

has the right to terminate the Option Agreements or any Research Program upon material breach

that remains uncured or the other party’s bankruptcy.

Additionally, as part of the

Option Agreements, on December 31, 2024 and December 31, 2025, we granted and will grant, respectively, Paruka a warrant to purchase

a number of shares equal to 1.00% of outstanding shares as of the date of the grant on a fully-diluted basis, with an exercise price equal

to the fair market value of the underlying shares on the grant date.

Therapeutics – License Agreements

September 2024, we exercised the Option to acquire certain rights to ORKA-001, and in December 2024, we entered into the corresponding

license agreement with Paragon (the “ORKA-001 License Agreement”), pursuant to which Paragon granted us a royalty-bearing,

world-wide, exclusive license to develop, manufacture, commercialize or otherwise exploit certain antibodies and products targeting IL-23

in all fields other than the field of inflammatory bowel disease (“ORKA-001 Field”).

In December 2024, we exercised the Option

with respect to ORKA-002 for the IL-17A/F program, and in February 2025, we entered into the corresponding license agreement with Paragon

(the “ORKA-002 License Agreement” and together with the ORKA-001 License Agreement, the “License Agreements”),

pursuant to which Paragon granted us a royalty-bearing, world-wide, exclusive license to develop, manufacture, commercialize or otherwise

exploit certain antibodies and products targeting IL-17A/F in all fields (“ORKA-002 Field” and together with the ORKA-001

Field, the “Fields”).

License Agreements provide us with exclusive licenses in the Fields to Paragon’s patent applications covering the related antibodies,

their method of use and their method of manufacture and Paragon has agreed not to conduct any new campaigns that generate anti-IL-23

monospecific antibodies or anti-IL-17A/F monospecific antibodies for the ORKA-001 Field or the ORKA-002 Field, respectively, for at least

Each of the ORKA-001 and ORKA-002 License Agreements may be terminated on 60 days’ notice to Paragon, on material breach

without cure, and on a party’s insolvency or bankruptcy to the extent permitted by law.

to the terms of each of the ORKA-001 and ORKA-002 License Agreements, we are obligated to pay Paragon non-refundable milestone payments

of up to $12.0 million under each respective agreement upon the achievement of certain clinical development milestones and up to $10.0

million under each respective agreement upon the achievement of certain regulatory milestones, including a $1.5 million fee for nomination

of a development candidate (or initiation of an investigational new drug (“IND”) enabling toxicology study) and a further

milestone payment of $2.5 million upon the first dosing of a human patient in a Phase 1 trial for each of ORKA-001 and ORKA-002.

we are obligated to pay Paragon a low single-digit percentage royalty for antibody products for each of ORKA-001 and ORKA-002.

of the License Agreements, the royalty term ends on the later of (i) the last-to-expire licensed patent or our patent directed to the

manufacture, use or sale of a licensed antibody in the country at issue or (ii) 12 years from the date of first sale of a Company product.

There is also a royalty step-down if there is no Paragon patent in effect during the royalty term for each program.

Line License Agreement

March 2024, we entered into the Cell Line License Agreement (the “Cell Line License Agreement”) with WuXi Biologics Ireland

Limited (“WuXi Biologics”).

Under the Cell Line License Agreement, we received a non-exclusive, worldwide, sublicensable

license to certain of WuXi Biologics’ know-how, cell line, biological materials (the “WuXi Biologics Licensed Technology”)

and media and feeds to make, have made, use, sell and import certain therapeutic products produced through the use of the cell line licensed

by WuXi Biologics under the Cell Line License Agreement (the “WuXi Biologics Licensed Products”).

Specifically, the WuXi

Biologics Licensed Technology is used in certain manufacturing activities in support of the ORKA-001 and ORKA-002 programs.

consideration for the license, we agreed to pay WuXi Biologics a non-refundable license fee of $150,000.

Additionally, to the extent

that we manufacture our commercial supplies of bulk drug product with a manufacturer other than WuXi Biologics or its affiliates, we

are required to make royalty payments to WuXi Biologics at a rate of less than one percent of net sales of WuXi Biologics Licensed Products

manufactured by the third-party manufacturer.

Pursuant to an amendment to the Cell Line License Agreement effective in November 2024,

a provision was added that permits the royalties owed under the agreement to be bought out on a product-by-product basis for

a lump-sum payment.

Cell Line License Agreement will continue indefinitely unless terminated (i) by us upon six months’ prior written notice and our

payment of all undisputed amounts due to WuXi Biologics through the effective date of termination, (ii) by WuXi Biologics for a material

breach by us that remains uncured for 60 days after written notice, (iii) by WuXi Biologics if we fail to make a payment and such failure

continues for 30 days after receiving notice of such failure, or (iv) by either party upon the other party’s bankruptcy.

FDA and other regulatory authorities at federal, state and local levels, as well as in foreign countries, extensively regulate, among

other things, the research, development, testing, manufacture, quality control, import, export, safety, effectiveness, labeling, packaging,

storage, distribution, record keeping, approval, advertising, promotion, marketing, post-approval monitoring and post-approval reporting

of biologics such as those we are developing.

We, along with our third-party contractors, will be required to navigate the various preclinical,

clinical and commercial approval requirements of the governing regulatory agencies of the countries in which we wish to conduct studies

or seek approval or licensure of our product candidates.

Generally, before a new therapeutic product can be marketed, considerable data

demonstrating a biological product candidate’s quality, safety, purity and potency, or a small molecule drug candidate’s

quality, safety and efficacy, must be obtained, organized into a format specific for each regulatory authority, submitted for review

and approved by the regulatory authority.

For biological product candidates, potency is similar to efficacy and is interpreted to mean

the specific ability or capacity of the product, as indicated by appropriate laboratory tests or by adequately controlled clinical data

obtained through the administration of the product in the manner intended, to effect a given result.

to comply with the applicable U.S.

requirements at any time during the product development process, approval process or post-marketing

may subject an applicant to administrative or judicial sanctions.

These sanctions could include, among other actions, the FDA’s

refusal to approve pending applications from the sponsor, withdrawal of an approval, a clinical hold, untitled or warning letters, product

recalls or market withdrawals, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals

of government contracts, restitution, disgorgement and civil or criminal penalties.

Any agency or judicial enforcement action could have

a material adverse effect on our company and our products or product candidates.

States Biologics Regulation

the United States, biological products are subject to regulation under the Federal Food, Drug, and Cosmetic Act (“FDCA”),

the Public Health Service Act (“PHSA”) and other federal, state, local, and foreign statutes and regulations.

of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, and local statutes and regulations requires

the expenditure of substantial time and financial resources.

into two Antibody Discovery and Option Agreements with Paragon and Paruka Holding, LLC (“Paruka”) (each, an “Option

Agreement”), pursuant to which we initiated certain research programs with Paragon focusing on discovering, generating, identifying

and/or characterizing antibodies directed to a particular target, including for IL-23 and IL-17A/F for ORKA-001 and ORKA-002, respectively.

In September 2024, we exercised our exclusive option to acquire certain rights to ORKA-001, and in December 2024, we entered into a corresponding

license agreement with Paragon pursuant to which Paragon granted us a royalty-bearing, world-wide, exclusive license to develop, manufacture,

commercialize or otherwise exploit certain antibodies and products targeting IL-23 in all fields other than the field of inflammatory

bowel disease.

In December 2024, we exercised our exclusive option to acquire certain rights to ORKA-002, and in February 2025, we entered

into the corresponding license agreement with Paragon pursuant to which Paragon granted us a royalty-bearing, world-wide, exclusive license

to develop, manufacture, commercialize or otherwise exploit certain antibodies and products targeting IL-17A/F in all fields (collectively,

the “License Agreements”).

Pursuant to each of the License

Agreements, Paragon has agreed not to conduct any new campaigns that generate anti-IL-23 monospecific antibodies or anti-IL-17A/F monospecific

antibodies in the respective agreed-upon fields.

Each of the ORKA-001 and ORKA-002 License Agreements may be terminated on 60 days’

notice to Paragon, on material breach without cure, and on a party’s insolvency or bankruptcy to the extent permitted by law.

Pursuant to the terms

of each of the License Agreements, we are obligated to pay Paragon non-refundable milestone payments of up to $12.0 million under

each respective agreement upon the achievement of certain clinical development milestones and up to $10.0 million under each

respective agreement upon the achievement of certain regulatory milestones.

As of December 31, 2025, we have incurred and expensed

milestone payments of $7.0 million and $4.0 million in connection with the ORKA-001 License Agreement and the ORKA-002 License

Agreement, respectively.

In addition, we are obligated to pay Paragon a low single-digit percentage royalty for antibody products

for each of ORKA-001 and ORKA-002.

For each of the License Agreements, the royalty term ends on the later of (i) the last-to-expire

licensed patent or our patent directed to the manufacture, use or sale of a licensed antibody in the country at issue or (ii) 12

years from the date of first sale of our product.

There is also a royalty step-down if there is no Paragon patent in effect during

the royalty term for each program.

Additionally, as part of

the Option Agreements and the additional option agreement described in the following paragraph, on December 31, 2024, we settled our

2024 obligations under the Paruka Warrant Obligation by issuing Paruka a warrant to purchase 596,930 shares of company common stock at

an exercise price of $19.39 per share, and on December 12, 2025, we settled our 2025 obligations under the Paruka Warrant Obligation

by issuing Paruka a warrant to purchase 375,000 shares of company common stock at an exercise price of $30.18 per share.

In December 2025, we entered into an additional option agreement for

an antibody with Paragon and Paruka to enter into a license agreement, which we exercised in December 2025.

For the year ended December

31, 2025 we incurred $1.5 million related to this additional option agreement, which was recognized as research and development expense.

Per the terms of this option agreement, once we enter into the corresponding license agreement, we will be required to make non-refundable

milestone payments to Paragon of up to $12.0 million under the agreement upon the achievement of certain clinical development milestones,

up to $10.0 million under the agreement upon the achievement of certain regulatory milestones, as well as a low single-digit percentage

royalty for antibody products beginning on the first commercial sale.

As of December 31, 2025, we have not entered into a license agreement

with Paragon and Paruka related to this additional option agreement.

Cell Line License Agreement

In March 2024, we entered

into the Cell Line License Agreement (the “Cell Line License Agreement”) with WuXi Biologics Ireland Limited (“WuXi

Under the Cell Line License Agreement, we received a non-exclusive, worldwide, sublicensable license to certain of

WuXi Biologics’ know-how, cell line, biological materials (the “WuXi Biologics Licensed Technology”) and media and feeds

to make, have made, use, sell and import certain therapeutic products produced through the use of the cell line licensed by WuXi Biologics

under the Cell Line License Agreement (the “WuXi Biologics Licensed Products”).

Specifically, the WuXi Biologics Licensed

Technology is used in certain manufacturing activities in support of the ORKA-001 and ORKA-002 programs.

In consideration for the

license, we agreed to pay WuXi Biologics a non-refundable license fee of $150,000.

Additionally, to the extent that we manufacture our

commercial supplies of bulk drug product for ORKA-001 and/or ORKA-002 under such license with a manufacturer other than WuXi Biologics

or its affiliates, we are required to make royalty payments to WuXi Biologics at a rate of less than one percent of net sales of WuXi

Biologics Licensed Products manufactured by the third-party manufacturer.

Pursuant to an amendment to the Cell Line License Agreement

effective in November 2024, a provision was added that permits the royalties owed under the agreement to be bought out on a product-by-product basis

for a lump-sum payment.

The Cell Line License Agreement

will continue indefinitely unless terminated (i) by us upon six months’ prior written notice and our payment of all undisputed amounts

due to WuXi Biologics through the effective date of termination, (ii) by WuXi Biologics for a material breach by us that remains uncured

for 60 days after written notice, (iii) by WuXi Biologics if we fail to make a payment and such failure continues for 30 days after receiving

notice of such failure, or (iv) by either party upon the other party’s bankruptcy.

Government Regulation

The FDA and other regulatory authorities at federal, state and local

levels, as well as in foreign countries, extensively regulate, among other things, the research, development, testing, manufacture, quality

control, import, export, safety, effectiveness, labeling, packaging, storage, distribution, record keeping, approval, advertising, promotion,

marketing, post-approval monitoring, and post-approval reporting of biologics such as those we are developing.

We, along with our third-party

contractors, will be required to navigate the various preclinical, clinical, and commercial approval requirements of the governing regulatory

agencies of the countries in which we wish to conduct studies or seek approval or licensure of our product candidates.

Generally, before

a new therapeutic product can be marketed, considerable data demonstrating a biological product candidate’s quality, safety, purity,

and potency, or a small molecule drug candidate’s quality, safety, and efficacy, must be obtained, organized into a format specific

for each regulatory authority, submitted for review and approved by the regulatory authority.

For biological product candidates, potency

is similar to efficacy and is interpreted to mean the specific ability or capacity of the product, as indicated by appropriate laboratory

tests or by adequately controlled clinical data obtained through the administration of the product in the manner intended, to effect a

given result.

Failure to comply with the applicable U.S.

requirements at any time during

the product development process, approval process or following approval may subject an applicant to administrative action and judicial

The process required by the FDA before biologic product candidates may be marketed in the United States generally involves

the following:

of preclinical laboratory tests and animal studies performed in accordance with the FDA’s

current Good Laboratory Practices (“GLP”) regulation;

to the FDA of an IND, which must become effective before clinical trials may begin and must

be updated annually or when significant changes are made;

by an independent institutional review board (“IRB”), or ethics committee at

each clinical site before the trial is commenced;

requirements at any time

during the product development process, approval process, or post-marketing may subject an applicant to administrative or judicial sanctions.

These sanctions could include, among other actions, the FDA’s refusal to approve pending applications from the sponsor, withdrawal

of an approval, a clinical hold, untitled or warning letters, product recalls or market withdrawals, product seizures, total or partial

suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement, and civil or

criminal penalties.

Any agency or judicial enforcement action could have a material adverse effect on our company and our products or

product candidates.

United States Biologics Regulation

In the United States, biological products are subject to regulation

under the Federal Food, Drug, and Cosmetic Act (“FDCA”), the Public Health Service Act (“PHSA”), and other federal,

state, local, and foreign statutes and regulations.

The process of obtaining regulatory approvals and the subsequent compliance with appropriate

federal, state, and local statutes and regulations requires the expenditure of substantial time and financial resources.

Failure to comply

with the applicable U.S.

requirements at any time during the product development process, approval process, or following approval may

subject an applicant to administrative action and judicial sanctions.

The process required by the FDA before biologic product candidates

may be marketed in the United States generally involves the following:

of preclinical laboratory tests and animal studies performed in accordance with the FDA’s current Good Laboratory Practices (“GLP”)

to the FDA of an IND, which must become effective before clinical trials may begin and must be updated annually or when significant changes

● approval by an independent institutional review board (“IRB”)

or ethics committee at each clinical site before the trial is commenced;

● manufacture

of the proposed biologic candidate in accordance with current Good Manufacturing Practices

● performance

of adequate and well-controlled human clinical trials in accordance with current Good Clinical

Practice (“GCP”) requirements to establish the safety, purity and potency of

the proposed biologic product candidate for its intended purpose;

of the proposed biologic candidate in accordance with current Good Manufacturing Practices (“cGMPs”);

● performance of adequate and well-controlled human clinical trials in

accordance with current Good Clinical Practice (“GCP”) requirements to establish the safety, purity, and potency of the proposed

biologic product candidate for its intended purpose;

● preparation

2 unchanged sentences

completion of an FDA Advisory Committee review, if applicable;

determination by the FDA within 60 days of its receipt of a BLA to file the application for

● satisfactory

completion of an FDA pre-approval inspection of the manufacturing facility or facilities

at which the proposed product is produced to assess compliance with cGMPs, and to assure

that the facilities, methods and controls are adequate to preserve the biological product’s

continued safety, purity and potency, and of selected clinical investigation sites to assess

compliance with GCPs;

review and approval of a BLA to permit commercial marketing of the product for particular

indications for use in the United States.

and Clinical Development

to beginning any clinical trial with a product candidate in the United States, we must submit an IND to the FDA.

An IND is a request

for authorization from the FDA to administer an investigational new drug product to humans.

The central focus of an IND submission is

on the general investigational plan and the protocol or protocols for preclinical studies and clinical trials.

The IND also includes

results of animal and in vitro studies assessing the toxicology, pharmacokinetics, pharmacology and pharmacodynamic characteristics of

the product, chemistry, manufacturing and controls information, and any available human data or literature to support the use of the

investigational product.

An IND must become effective before human clinical trials may begin.

The IND automatically becomes effective

30 days after receipt by the FDA, unless the FDA, within the 30-day period, raises safety concerns or questions about the proposed clinical

In such a case, the IND may be placed on clinical hold and the IND sponsor and the FDA must resolve any outstanding concerns or

questions before the clinical trial can begin.

Submission of an IND therefore may or may not result in FDA authorization to begin a clinical

addition to the IND submission process, supervision of human gene transfer trials includes evaluation and assessment by an institutional

biosafety committee (“IBC”), a local institutional committee that reviews and oversees research utilizing recombinant or

synthetic nucleic acid molecules at that institution.

The IBC assesses the safety of the research and identifies any potential risk to

public health or the environment and such review may result in some delay before initiation of a clinical trial.

trials involve the administration of the investigational product to human subjects under the supervision of qualified investigators in

accordance with GCPs, which include the requirement that all research subjects provide their informed consent for their participation

in any clinical study.

Clinical trials are conducted under protocols detailing, among other things, the objectives of the study, the

parameters to be used in monitoring safety and the effectiveness criteria to be evaluated.

A separate submission to the existing IND

must be made for each successive clinical trial conducted during product development and for any subsequent protocol amendments.

an independent IRB for each site proposing to conduct the clinical trial must review and approve the plan for any clinical trial and

its informed consent form before the clinical trial begins at that site, and must monitor the study until completed.

authorities, the IRB or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the subjects

are being exposed to an unacceptable health risk or that the trial is unlikely to meet its stated objectives.

Some studies also include

oversight by an independent group of qualified experts organized by the clinical study sponsor, known as a data safety monitoring board,

which provides authorization for whether or not a study may move forward at designated check points based on access to certain data from

the study and may halt the clinical trial if it determines that there is an unacceptable safety risk for subjects or other grounds, such

as no demonstration of efficacy.

There are also requirements governing the reporting of ongoing preclinical studies and clinical trials

and clinical study results to public registries.

purposes of BLA approval, human clinical trials are typically conducted in three sequential phases that may overlap.

The investigational product is initially introduced into healthy human subjects or patients

with the target disease or condition.

These studies are designed to test the safety, dosage

tolerance, absorption, metabolism and distribution of the investigational product in humans,

the side effects associated with increasing doses, and, if possible, to gain early evidence

on effectiveness.

The investigational product is administered to a limited patient population with a specified

disease or condition to evaluate the preliminary efficacy, optimal dosages and dosing schedule

and to identify possible adverse side effects and safety risks.

Multiple Phase 2 clinical

trials may be conducted to obtain information prior to beginning larger and more expensive

Phase 3 clinical trials.

The investigational product is administered to an expanded patient population to further

evaluate dosage, to provide statistically significant evidence of clinical efficacy and to

further test for safety, generally at multiple geographically dispersed clinical trial sites.

These clinical trials are intended to establish the overall risk/benefit ratio of the investigational

product and to provide an adequate basis for product approval.

some cases, the FDA may require, or companies may voluntarily pursue, additional clinical trials after a product is approved to gain

more information about the product.

These so-called Phase 4 studies may be made a condition to approval of the BLA.

Concurrent with clinical

trials, companies may complete additional animal studies and develop additional information about the biological characteristics of the

product candidate and must finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements.

The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things,

must develop methods for testing the identity, strength, quality and purity of the final product, or for biologics, the safety, purity

determination by the FDA within 60 days of its receipt of a BLA to file the application for review;

● satisfactory completion of an FDA pre-approval inspection of the manufacturing

facility or facilities at which the proposed product is produced to assess compliance with cGMPs, and to assure that the facilities, methods,

and controls are adequate to preserve the biological product’s continued safety, purity, and potency, and of selected clinical investigation

sites to assess compliance with GCP;

review and approval of a BLA to permit commercial marketing of the product for particular indications for use in the United States.

Preclinical and Clinical Development

Once a therapeutic product

candidate is identified for development, it must undergo preclinical studies before commencing any testing in humans.

Preclinical studies

include laboratory evaluations of product chemistry, formulation, and stability, as well as studies to evaluate the candidate’s potential

for efficacy and toxicity in animals.

The conduct of preclinical tests and formulation of the compounds for testing must comply with federal

regulations and requirements, including current GLPs.

Prior to beginning any clinical trial with a product candidate in the

United States, we must submit an IND application to the FDA.

An IND application is a request for authorization from the FDA to administer

an investigational new drug product to humans.

The central focus of an IND application is on the general investigational plan, supportive

nonclinical evaluations, and the protocol or protocols for clinical trials.

The IND includes results of animal and in vitro studies assessing

the toxicology, pharmacokinetics, pharmacology, and pharmacodynamic characteristics of the product, chemistry, manufacturing and controls

information, and any available human data or literature to support the use of the investigational product.

An IND must become effective

before human clinical trials may begin.

The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within

the 30-day period, raises safety concerns or questions about the proposed clinical trial.

In such a case, the IND may be placed on clinical

hold and the IND sponsor and the FDA must resolve any outstanding concerns or questions before the clinical trial can begin.

of an IND therefore may or may not result in FDA authorization to begin a clinical trial.

Clinical trials involve the

administration of the investigational product to human subjects under the supervision of qualified investigators in accordance with current

GCPs, which include the requirement that all research subjects provide their informed consent for their participation in any clinical

Clinical trials are conducted under protocols detailing, among other things, the objectives of the study, the parameters

to be used in monitoring safety, and the effectiveness criteria to be evaluated.

A separate submission to the existing IND must be made

for each successive clinical trial conducted during product development and for any subsequent protocol amendments.

Furthermore, an independent

IRB for each site proposing to conduct the clinical trial must review and approve the plan for any clinical trial and its informed consent

form before the clinical trial begins at that site, and must monitor the trial until completed.

Regulatory authorities, the

IRB or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the subjects are being exposed

to an unacceptable health risk or that the trial is unlikely to meet its stated objectives.

Some trials also include oversight

by an independent group of qualified experts organized by the clinical trial sponsor, known as a data safety monitoring board

or data monitoring committee, which provides authorization for whether or not a trial may move forward at designated check

points based on access to certain data from the study and may halt the clinical trial if it determines that there is an unacceptable safety

risk for subjects or other grounds, such as no demonstration of efficacy.

There are also requirements governing the reporting of ongoing

clinical trials and clinical trial results to public registries.

Human clinical trials are typically conducted in three sequential phases

that may overlap.

The investigational product is initially introduced into healthy

human subjects or patients with the target disease or condition.

These studies are designed to test the safety, dosage tolerance, absorption,

metabolism, and distribution of the investigational product in humans, the side effects associated with increasing doses, and, if possible,

to gain early evidence on effectiveness.

The investigational product is administered to a limited patient

population with a specified disease or condition to evaluate the preliminary efficacy, optimal dosages and dosing schedule, and to identify

possible adverse side effects and safety risks.

Multiple Phase 2 clinical trials may be conducted to obtain information prior to beginning

larger and more expensive Phase 3 clinical trials.

The investigational product is administered to an expanded patient population to further evaluate dosage, to provide statistically

significant evidence of clinical efficacy and to further test for safety, generally at multiple geographically dispersed clinical trial

These clinical trials are intended to establish the overall risk/benefit ratio of the investigational product and to provide an

adequate basis for product approval.

In some cases, the FDA may require, or companies may voluntarily pursue,

additional clinical trials after a product is approved to gain more information about the product.

These so-called Phase 4 studies may

be made a condition to approval of the BLA.

Concurrent with clinical trials, companies may complete additional animal studies and develop

additional information about the biological characteristics of the product candidate and must finalize a process for manufacturing the

product in commercial quantities in accordance with cGMP requirements.

The manufacturing process must be capable of consistently producing

quality batches of the product candidate and, among other things, methods must be developed for testing the safety, purity, and potency

of the biologic.

Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate

that the product candidate does not undergo unacceptable deterioration over its shelf life.

sponsor may choose, but is not required, to conduct a foreign clinical study under an IND.

When a foreign clinical study is conducted

that the product candidate does not undergo unacceptable deterioration over its claimed shelf life.

A sponsor may choose, but is not required, to conduct a foreign clinical trial under an IND.

When a foreign clinical trial is conducted

under an IND, all IND requirements must be met unless waived.

When the foreign clinical study is not conducted under an IND, the sponsor

must ensure that the study complies with certain FDA regulatory requirements in order to use the study as support for an IND or application

for marketing approval or licensure, including that the study was conducted in accordance with GCP, including review and approval by

an independent ethics committee and use of proper procedures for obtaining informed consent from subjects, and the FDA is able to validate

the data from the study through an onsite inspection if the FDA deems such inspection necessary.

The GCP requirements encompass both

ethical and data integrity standards for clinical studies.

Submission and Review

successful completion of all required testing in accordance with all applicable regulatory requirements, the results of product development,

nonclinical studies and clinical trials are submitted to the FDA as part of a BLA requesting approval to market the product for one or

more indications.

The BLA must include all relevant data available from pertinent preclinical studies and clinical trials, including

negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s chemistry,

manufacturing, controls, and proposed labeling, among other things.

Data can come from company-sponsored clinical studies intended to

test the safety and effectiveness of the product, or from a number of alternative sources, including studies initiated and sponsored

by investigators.

The submission of a BLA requires payment of a substantial application user fee to the FDA, unless a waiver or exemption

addition, under the Pediatric Research Equity Act (“PREA”), a BLA or supplement to a BLA must contain data to assess the

safety and effectiveness of the biological product candidate for the claimed indications in all relevant pediatric subpopulations and

to support dosing and administration for each pediatric subpopulation for which the product is safe and effective.

The Food and Drug

Administration Safety and Innovation Act requires that a sponsor who is planning to submit a marketing application for a biological product

that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration submit an initial

pediatric study plan within sixty days after an end-of-Phase 2 meeting or as may be agreed between the sponsor and FDA.

Unless otherwise

required by regulation, PREA does not apply to any biological product for an indication for which orphan designation has been granted.

60 days following submission of the application, the FDA reviews a BLA submitted to determine if it is substantially complete before

the agency accepts it for filing.

The FDA may refuse to file any BLA that it deems incomplete or not properly reviewable at the time

of submission and may request additional information.

When the foreign clinical trial is not conducted under an IND, the sponsor

must ensure that the trial complies with certain FDA regulatory requirements in order to use the trial as support of a BLA, including

that the trial was conducted in accordance with GCP, review and approval by an independent ethics committee, use of proper procedures

for obtaining informed consent from subjects, and the FDA is able to validate the data from the trial through an onsite inspection if

the FDA deems such inspection necessary.

The GCP requirements encompass both ethical and data integrity standards for clinical studies.

BLA Submission and Review

Assuming successful completion of all required testing in accordance

with all applicable regulatory requirements, the results of product development, nonclinical studies, and clinical trials are submitted

to the FDA as part of a BLA requesting approval to market the product for one or more indications.

The BLA must include all relevant data

available from pertinent preclinical studies and clinical trials, including negative or ambiguous results as well as positive findings,

together with detailed information relating to the product’s chemistry, manufacturing, controls, and proposed labeling, among other

Data can come from company-sponsored clinical trials intended to test the safety and effectiveness of the product, or from a number

of alternative sources, including trials initiated and sponsored by investigators.

The submission of a BLA requires payment of a substantial

application user fee to the FDA, unless a waiver or exemption applies.

In addition, under the Pediatric

Research Equity Act (“PREA”), a BLA or supplement to a BLA must contain data to assess the safety and effectiveness of the

biological product candidate for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration

for each pediatric subpopulation for which the product is safe and effective, unless a different timeline has been previously agreed upon

by the FDA, through approval of a pediatric study plan, as described below.

The Food and Drug Administration Safety and Innovation Act

requires that a sponsor who is planning to submit a marketing application for a biological product that includes a new active ingredient,

new indication, new dosage form, new dosing regimen or new route of administration submit an initial pediatric study plan (“PSP”)

within sixty days after an end-of-Phase 2 meeting or as may be agreed between the sponsor and FDA.

Unless otherwise required by regulation,

PREA does not apply to any biological product for an indication for which orphan designation has been granted.

Within 60 days following

submission of the application, the FDA reviews a BLA submitted to determine if it is substantially complete before the agency accepts

it for filing.

The FDA may refuse to file any BLA that it deems incomplete or not properly reviewable at the time of submission and may

request additional information.

In this event, the BLA must be resubmitted with the additional information.

a BLA has been accepted for filing, the FDA’s goal is to review standard applications within ten months after the filing date,

Once a BLA has been accepted

for filing, the FDA’s goal is to review standard applications within ten months after the FDA accepts the application for filing,

or, if the application qualifies for priority review, six months after the FDA accepts the application for filing.

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but it considers such recommendations carefully when making decisions.

approving a BLA, the FDA will typically inspect the facility or facilities where the product is manufactured.

The FDA will not approve

an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate

to assure consistent production of the product within required specifications.

Additionally, before approving a BLA, the FDA will typically

inspect one or more clinical sites to assure compliance with GCPs.

If the FDA determines that the application, manufacturing process

or manufacturing facilities are not acceptable, it will outline the deficiencies in the submission and often will request additional

testing or information.

Notwithstanding the submission of any requested additional information, the FDA ultimately may decide that the

application does not satisfy the regulatory criteria for approval.

the FDA evaluates a BLA and conducts inspections of manufacturing facilities where the investigational product and/or its drug substance

will be produced, the FDA may issue an approval letter or a Complete Response letter.

An approval letter authorizes commercial marketing

of the product with specific prescribing information for specific indications.

A Complete Response letter will describe all of the deficiencies

that the FDA has identified in the BLA, except that where the FDA determines that the data supporting the application are inadequate

to support approval, the FDA may issue the Complete Response letter without first conducting required inspections, testing submitted

product lots and/or reviewing proposed labeling.

In issuing the Complete Response letter, the FDA may recommend actions that the applicant

might take to place the BLA in condition for approval, including requests for additional information or clarification.

The FDA may delay

or refuse approval of a BLA if applicable regulatory criteria are not satisfied, require additional testing or information and/or require

post-marketing testing and surveillance to monitor safety or efficacy of a product.

regulatory approval of a product is granted, such approval will be granted for particular indications and may entail limitations on the

indicated uses for which such product may be marketed.

For example, the FDA may approve the BLA with a risk evaluation and mitigation

strategy (“REMS”) to ensure the benefits of the product outweigh its risks.

A REMS is a safety strategy to manage a known

or potential serious risk associated with a product and to enable patients to have continued access to such medicines by managing their

safe use, and could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution

methods, patient registries and other risk minimization tools.

The FDA also may condition approval on, among other things, changes to

proposed labeling or the development of adequate controls and specifications.

Once approved, the FDA may withdraw the product approval

if compliance with pre- and post-marketing requirements is not maintained or if problems occur after the product reaches the marketplace.

The FDA may require one or more Phase 4 post-market studies and surveillance to further assess and monitor the product’s safety

and effectiveness after commercialization, and may limit further marketing of the product based on the results of these post-marketing

therapy is a treatment modality that involves the use of two or more drugs to be used in combination to treat a disease or condition.

If those drugs are combined in one dosage form, such as one pill, that is known as a fixed dose combination product and it is reviewed

pursuant to the FDA’s Combination Rule at 21 CFR 300.50.

The rule provides that two or more drugs may be combined in a single dosage

form when each component contributes to the claimed effects and the dosage of each component (amount, frequency, duration) is such that

the combination is safe and effective for a significant patient population requiring such concurrent therapy as defined in the labeling

for the drug.

But not all combination therapy falls under the category of a fixed dose combination.

Before approving a BLA, the FDA will typically inspect the facility

or facilities where the product is manufactured.

The FDA will not approve an application unless it determines that the manufacturing processes

and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications.

Additionally, before approving a BLA, the FDA will typically inspect one or more clinical sites to assure compliance with GCPs and data

integrity of the submitted clinical trial data.

If the FDA determines that the application, manufacturing process or manufacturing facilities

are not acceptable, it will outline the deficiencies in the submission and often will request additional testing or information.

Notwithstanding

the submission of any requested additional information, the FDA ultimately may decide that the application does not satisfy the regulatory

criteria for approval.

After the FDA evaluates a

BLA and conducts inspections of manufacturing facilities where the investigational product and/or its drug substance will be produced,

the FDA may issue an approval letter or a Complete Response letter.

An approval letter authorizes commercial marketing of the product

with specific prescribing information for specific indications.

A Complete Response letter will describe all of the deficiencies that

the FDA has identified in the BLA, except that where the FDA determines that the data supporting the application are inadequate to support

approval, the FDA may issue the Complete Response letter without first conducting required inspections, testing submitted product lots,

and/or reviewing proposed labeling.

In issuing the Complete Response letter, the FDA may recommend actions that the applicant might take

to place the BLA in condition for approval, including requests for additional information or clarification.

The FDA may delay or refuse

approval of a BLA if applicable regulatory criteria are not satisfied, require additional testing or information, and/or require post-marketing

testing and surveillance to monitor safety or efficacy of a product.

If regulatory approval of a product is granted, such approval will

be granted for particular indications and may entail limitations on the indicated uses for which such product may be marketed.

the FDA may approve the BLA with a Risk Evaluation and Mitigation Strategy (“REMS”) to ensure the benefits of the product

outweigh its risks.

A REMS is a safety strategy to manage a known or potential serious risk associated with a product and to enable patients

to have continued access to such medicines by managing their safe use, and could include requirements for medication guides, physician

communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries, and other risk minimization

The FDA also may condition approval on, among other things, changes to proposed labeling, or the development of adequate controls

and specifications.

Once approved, the FDA may withdraw the product approval if compliance with pre- and post-marketing requirements

is not maintained or if problems occur after the product reaches the marketplace.

The FDA may require one or more Phase 4 post-marketing

studies, and/or surveillance in addition to that required of every approved product to further assess and monitor the product’s

safety and effectiveness after commercialization, and may limit further marketing of the product based on the results of these post-marketing

Combination Therapy

Combination therapy is a

treatment modality that involves the use of two or more drugs to be used in combination to treat a disease or condition.

If those drugs

are combined in one dosage form, such as a single injection, that is known as a fixed dose combination product and it is reviewed pursuant

to the FDA’s Combination Rule at 21 CFR 300.50.

The rule provides that two or more drugs may be combined in a single dosage form

when each component contributes to the claimed effects and the dosage of each component (amount, frequency, duration) is such that the

combination is safe and effective for a significant patient population requiring such concurrent therapy as defined in the labeling for

However, not all combination therapy falls under the category of a fixed dose combination.

For example, the FDA recognizes that

two drugs in separate dosage forms and in separate packaging, that otherwise might be administered as monotherapy for an indication,

also may be used in combination for the same indication.

In 2013, the FDA issued guidance to assist sponsors that were developing the

range of combination therapies that fall outside the category of fixed dose combinations.

That guidance provides recommendations and

advice on such topics as:

two drugs in separate dosage forms and in separate packaging, that otherwise might be administered as monotherapy for an indication, also

may be used in combination for the same indication.

In 2013, the FDA issued guidance to assist sponsors that were developing the range

of combination therapies that fall outside the category of fixed dose combinations.

That guidance provides recommendations and advice

on such topics as:

(1) assessment at the outset whether two or more therapies are appropriate for use in combination;

principles for nonclinical and clinical development of the combination;

(3) options for regulatory pathways to seek marketing approval

of the combination;

(2) guiding principles

for nonclinical and clinical development of the combination;

(3) options for regulatory pathways to seek marketing approval of the combination;

and (4) post-marketing safety monitoring and reporting obligations.

Given the wide range of potential combination

therapy variations, the FDA indicated it intends to assess each potential combination on a case-by case basis and encouraged sponsors

to engage in early and regular consultation with the relevant review division at the agency throughout the development process for its

proposed combination.

of Combination Products

therapeutic products are comprised of multiple components, such as drug components, biologic components, and device components, that

would normally be subject to different regulatory frameworks by the FDA and frequently regulated by different centers at the FDA.

products are known as combination products.

Under the FDCA, the FDA is charged with assigning a center with primary jurisdiction, or

a lead center, for review of a combination product.

The determination of which center will be the lead center is based on the “primary

mode of action” of the combination product.

Thus, if the primary mode of action of drug/biologic-device combination product is

attributable to the drug or biological product, the FDA center responsible for premarket review of the drug or biological product would

have primary jurisdiction for the combination product.

The FDA has also established the Office of Combination Products to address issues

surrounding combination products and provide more certainty to the regulatory review process.

That office serves as a focal point for

combination product issues for agency reviewers and industry.

It is also responsible for developing guidance and regulations to clarify

the regulation of combination products, and for assignment of the FDA center that has primary jurisdiction for review of combination

products where the jurisdiction is unclear or in dispute.

A combination product with a primary mode of action attributable to the drug

or biologic component generally would be reviewed and approved pursuant to the drug or biologic approval processes set forth in the FDCA.

In reviewing the new drug application or BLA for such a product, however, FDA reviewers would consult with their counterparts in the

FDA’s Center for Devices and Radiological Health to ensure that the device component of the combination product met applicable

requirements regarding safety, effectiveness, durability and performance.

In addition, under FDA regulations, combination products are

subject to cGMP requirements applicable to both drugs and devices, including the Quality System Regulation applicable to medical devices.

Post-Approval

products manufactured or distributed by us pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including,

among other things, requirements relating to record-keeping, reporting of adverse experiences, periodic reporting, product sampling and

distribution, and advertising and promotion of the product.

As part of the manufacturing process, the manufacturer is required to perform

certain tests on each lot of the product before it is released for distribution.

After a BLA is approved for a biological product, the

product also may be subject to official lot release.

If the product is subject to official release by the FDA, the manufacturer submits

samples of each lot of product to the FDA together with a release protocol showing a summary of the history of manufacture of the lot

and the results of all of the manufacturer’s tests performed on the lot.

The FDA also may perform certain confirmatory tests on

lots of some products before releasing the lots for distribution by the manufacturer.

In addition, the FDA conducts laboratory research

related to the regulatory standards on the safety, purity, and potency or effectiveness of biologics.

After approval, most changes to

the approved product, such as adding new indications or other labeling claims, are subject to prior FDA review and approval.

are continuing user fee requirements, under which the FDA assesses an annual program fee for each product identified in an approved BLA.

Biologic manufacturers and their subcontractors are required to register their establishments with the FDA and certain state agencies,

and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMPs, which impose certain

procedural and documentation requirements upon us and our third-party manufacturers.

Changes to the manufacturing process are strictly

regulated, and, depending on the significance of the change, may require prior FDA approval before being implemented.

FDA regulations

also require investigation and correction of any deviations from cGMPs and impose reporting requirements upon us and any third-party

manufacturers that we may decide to use.

Accordingly, manufacturers must continue to expend time, money and effort in the area of production

and quality control to maintain compliance with cGMPs and other aspects of regulatory compliance.

FDA may withdraw approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product

reaches the market.

Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity

or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved

labeling to add new safety information;

imposition of post-market studies or clinical studies to assess new safety risks;

or imposition

of distribution restrictions or other restrictions under a REMS program.

Given the wide range of potential combination therapy variations,

the FDA indicated it intends to assess each potential combination on a case-by case basis and encouraged sponsors to engage in early and

regular consultation with the relevant review division at the agency throughout the development process for its proposed combination.

Regulation of Combination Products

Certain therapeutic products are comprised of multiple components,

such as drug components, biologic components, and device components, that would normally be subject to different regulatory frameworks

by the FDA and frequently regulated by different centers at the FDA.

These products are known as combination products.

Under the FDCA,

the FDA is charged with assigning a center with primary jurisdiction, or a lead center, for review of a combination product.

The determination

of which center will be the lead center is based on the “primary mode of action” of the combination product.

primary mode of action of a drug/biologic-device combination product is attributable to the drug or biological product, the FDA center

responsible for premarket review of the drug or biological product would have primary jurisdiction for the combination product.

has also established the Office of Combination Products to address issues surrounding combination products and provide more certainty

to the regulatory review process.

That office serves as a focal point for combination product issues for agency reviewers and industry.

It is also responsible for developing guidance and regulations to clarify the regulation of combination products, and for assignment of

the FDA center that has primary jurisdiction for review of combination products where the jurisdiction is unclear or in dispute.

A combination

product with a primary mode of action attributable to the drug or biologic component generally would be reviewed and approved pursuant

to the drug or biologic approval processes set forth in the FDCA.

In reviewing the new drug application (“NDA”) or BLA for such a product,

however, FDA reviewers would consult with their counterparts in the FDA’s Center for Devices and Radiological Health to ensure that

the device component of the combination product met applicable requirements regarding safety, effectiveness, durability, and performance.

In addition, under FDA regulations, combination products are subject to cGMP requirements applicable to both drugs and devices, including

the Quality System Regulation applicable to medical devices.

Post-Approval Requirements

Any products manufactured or distributed by us pursuant to FDA approvals

are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to record-keeping,

reporting of adverse experiences, periodic reporting, product sampling and distribution, and advertising and promotion of the product.

As part of the manufacturing process, the manufacturer is required to perform certain tests on each lot of the product before it is released

for distribution.

After a BLA is approved for a biological product, the product also may be subject to official lot release.

If the product

is subject to official release by the FDA, the manufacturer submits samples of each lot of product to the FDA together with a release

protocol showing a summary of the history of manufacture of the lot and the results of all of the manufacturer’s tests performed

The FDA also may perform certain confirmatory tests on lots of some products before releasing the lots for distribution by

the manufacturer.

In addition, the FDA conducts laboratory research related to the regulatory standards on the safety, purity, and potency

or effectiveness of biologics.

After approval, most changes to the approved product, such as adding new indications or other labeling

claims, are subject to prior FDA review and approval.

There also are continuing user fee requirements, under which the FDA assesses an

annual program fee for each product identified in an approved BLA.

Biologic manufacturers and their subcontractors are required to register

their establishments with the FDA and certain state agencies, and are subject to periodic unannounced inspections by the FDA and certain

state agencies for compliance with cGMPs, which impose certain procedural and documentation requirements upon us and our third-party manufacturers.

Changes to the manufacturing process are strictly regulated, and, depending on the significance of the change, may require prior FDA review

and approval before being implemented.

FDA regulations also require investigation and correction of any deviations from cGMPs and impose

reporting requirements upon us and any third-party manufacturers that we may decide to use.

Accordingly, manufacturers must continue to

expend time, money, and effort in the area of production and quality control to maintain compliance with cGMPs and other aspects of regulatory

The FDA may withdraw approval

if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market.

Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with

manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new

safety information;

imposition of post-marketing studies or clinical studies to assess new safety risks;

or imposition of distribution

restrictions or other restrictions under a REMS program.

Other potential consequences include, among other things:

● restrictions

on the marketing or manufacturing of a product, complete withdrawal of the product from the

market or product recalls;

warning letters or holds on post-approval clinical studies;

of the FDA to approve pending applications or supplements to approved applications, or suspension

or revocation of existing product approvals;

● restrictions on the marketing or manufacturing of a product, complete

withdrawal of the product from the market, or product recalls;

● fines, warning letters, or holds on post-approval clinical studies;

of the FDA to approve pending applications or supplements to approved applications, or suspension or revocation of existing product approvals;

seizure or detention, or refusal of the FDA to permit the import or export of products;

decrees, corporate integrity agreements, debarment or exclusion from federal healthcare programs;

● consent decrees, corporate integrity agreements, debarment, or exclusion

from federal healthcare programs;

modification of promotional materials and labeling and the issuance of corrective information;

issuance of safety alerts, Dear Healthcare Provider letters, press releases and other communications

containing warnings or other safety information about the product;

● the issuance of safety alerts, Dear Healthcare Provider letters, press

releases, and other communications containing warnings or other safety information about the product;

● injunctions

or the imposition of civil or criminal penalties.

FDA closely regulates the marketing, labeling, advertising and promotion of biologics.

A company can make only those claims relating

to safety and efficacy, purity and potency that are approved by the FDA and in accordance with the provisions of the approved label.

The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses.

Failure to comply with

these requirements can result in, among other things, adverse publicity, warning letters, corrective advertising and potential civil

and criminal penalties.

Physicians may prescribe legally available products for uses that are not described in the product’s labeling

and that differ from those tested by us and approved by the FDA.

Such off-label uses are common across medical specialties.

may believe that such off-label uses are the best treatment for many patients in varied circumstances.

The FDA does not regulate the

behavior of physicians in their choice of treatments.

The FDA does, however, restrict manufacturer’s communications on the subject

of off-label use of their products.

and Reference Product Exclusivity

Patient Protection and Affordable Care Act, as amended by the Healthcare and Education Reconciliation Act (the “ACA”) includes

a subtitle called the Biologics Price Competition and Innovation Act of 2009 (“BPCIA”), which created an abbreviated

approval pathway for biological products that are highly similar, or “biosimilar,” to or interchangeable with an FDA-approved

reference biological product.

The FDA closely regulates the marketing, labeling, advertising and

promotion of biologics.

A company can make only those claims relating to safety and efficacy, purity and potency that are approved by

the FDA and consistent with the provisions of the approved label.

The FDA and other agencies actively enforce the laws and regulations

prohibiting the promotion of off-label uses.

Failure to comply with these requirements can result in, among other things, adverse publicity,

warning letters, corrective advertising and potential civil and criminal penalties.

Physicians may prescribe legally available products

for uses that are not described in the product’s labeling and that differ from those tested by us and approved by the FDA.

off-label uses are common across medical specialties.

Physicians may believe that such off-label uses are the best treatment for many

patients in varied circumstances.

The FDA does not regulate the behavior of physicians in their choice of treatments.

The FDA does, however,

restrict manufacturer’s communications on the subject of off-label uses of their products.

Additionally, promotional material for

approved biologic products must be submitted to the FDA in conjunction with their first use.

Biosimilars and Reference Product Exclusivity

The Patient Protection and

Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the “ACA”) includes a subtitle

called the Biologics Price Competition and Innovation Act of 2009 (“BPCIA”), which created an abbreviated approval pathway

for biological products that are highly similar, or “biosimilar,” to or interchangeable with an FDA-approved reference biological

The FDA has issued several guidance documents outlining an approach to review and approval of biosimilars.

Biosimilarity,

which requires that there be no clinically meaningful differences between the biological product and the reference product in terms of

safety, purity, and potency, is generally shown through analytical studies, animal studies, and a clinical study or studies.

Biosimilarity, which requires

that there be no clinically meaningful differences between the biological product and the reference product in terms of safety, purity,

and potency, is generally shown through analytical studies, animal studies, and a clinical trial or trials.

Interchangeability

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Complexities associated with the larger, and often more complex, structures of biological products, as well as the processes by which

such products are manufactured, pose significant hurdles to implementation of the abbreviated approval pathway that are still being worked

out by the FDA.

The FDA has issued guidance documents intended to inform prospective applicants and facilitate the development of proposed

biosimilars and interchangeable biosimilars, as well as to describe the FDA’s interpretation of certain statutory requirements

added by the BPCIA.

the BPCIA, an application for a biosimilar product may not be submitted to the FDA until four years following the date that the reference

product was first licensed by the FDA.

In addition, the approval of a biosimilar product may not be made effective by the FDA until 12

years from the date on which the reference product was first licensed.

During this 12-year period of exclusivity, another company may

still market a competing version of the reference product if the FDA approves a full BLA for the competing product containing that applicant’s

own preclinical data and data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of its

The BPCIA also created certain exclusivity periods for biosimilars approved as interchangeable products.

At this juncture, it

is unclear whether products deemed “interchangeable” by the FDA will, in fact, be readily substituted by pharmacies, which

are governed by state pharmacy law.

reference biologic is granted twelve years of exclusivity from the time of first licensure of the reference product.

The first biologic

product submitted under the abbreviated approval pathway that is determined to be interchangeable with the reference product has exclusivity

against other biologics submitted under the abbreviated approval pathway for the lesser of (i) one year after the first commercial marketing,

(ii) 18 months after approval if there is no legal challenge, (iii) 18 months after the resolution in the applicant’s favor of

a lawsuit challenging the biologics’ patents if an application has been submitted, or (iv) 42 months after the application has

been approved if a lawsuit is ongoing within the 42-month period.

biological product can also obtain pediatric market exclusivity in the United States.

Pediatric exclusivity, if granted, adds six months

to existing exclusivity periods and patent terms.

This six-month exclusivity, which runs from the end of other exclusivity protection

or patent term, may be granted based on the voluntary completion of a pediatric study in accordance with an FDA-issued “Written

Request” for such a study.

The BPCIA is complex and continues to be interpreted and implemented by the FDA.

In July 2018, the FDA

announced an action plan to encourage the development and efficient review of biosimilars, including the establishment of a new office

within the agency that will focus on therapeutic biologics and biosimilars.

On December 20, 2020, Congress amended the PHSA as part of

the COVID-19 relief bill to further simplify the biosimilar review process by making it optional to show that conditions of use proposed

in labeling have been previously approved for the reference product, which used to be a requirement of the application.

government proposals have sought to reduce the 12-year reference product exclusivity period.

Other aspects of the BPCIA, some of which

may impact the BPCIA exclusivity provisions, have also been the subject of recent litigation.

As a result, the ultimate impact, implementation,

and impact of the BPCIA is subject to significant uncertainty.

discussed below, the Inflation Reduction Act of 2022 (“IRA”) is a significant new law that intends to foster generic and

biosimilar competition and to lower drug and biologic costs.

Term Extension

the United States, after a BLA is approved, owners of relevant drug patents may apply for up to a five-year patent extension, which permits

patent term restoration as compensation for the patent term lost during the FDA regulatory process.

The allowable patent term extension

is typically calculated as one-half the time between, the latter of the effective date of an IND and issue date of the patent for which

extension is sought, and the submission date of a BLA, plus the time between BLA submission date and the BLA approval date up to a maximum

of five years.

The time can be shortened if the FDA determines that the applicant did not pursue licensure with due diligence.

patent term after the extension may not exceed 14 years from the date of product licensure.

Only one patent applicable to a licensed

biological product is eligible for extension and only those claims covering the product, a method for using it, or a method for manufacturing

it may be extended and the application for the extension must be submitted prior to the expiration of the patent in question.

we may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory

review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing

to satisfy applicable requirements.

Some, but not all, foreign jurisdictions possess patent term extension or other additional patent

exclusivity mechanisms that may be more or less stringent and comprehensive than those of the United States.

Healthcare Laws and Compliance Requirements

Pharmaceutical

companies are subject to additional healthcare regulation and enforcement by the federal government and by authorities in the states

and foreign jurisdictions in which they conduct their business.

Such laws include, without limitation:

the federal Anti-Kickback Statute

the federal False Claims Act (“FCA”);

the Health Insurance Portability and Accountability Act of 1996

(“HIPAA”) and similar foreign, federal and state fraud, abuse and transparency laws.

AKS prohibits, among other things, persons and entities from knowingly and willfully soliciting, receiving, offering or paying remuneration,

to induce, or in return for, either the referral of an individual, or the purchase or recommendation of an item or service for which

payment may be made under any federal healthcare program.

The term remuneration has been interpreted broadly to include anything of value.

AKS has been interpreted to apply to arrangements between pharmaceutical manufacturers on one hand, and prescribers and purchasers on

The government often takes the position that to violate the AKS, only one purpose of the remuneration need be to induce referrals,

even if there are other legitimate purposes for the remuneration.

There are a number of statutory exceptions and regulatory safe harbors

protecting some common activities from AKS prosecution, but they are drawn narrowly and practices that involve remuneration, such as

consulting agreements, that may be alleged to be intended to induce prescribing, purchasing or recommending may be subject to scrutiny

if they do not qualify for an exception or safe harbor.

Our practices may not in all cases meet all of the criteria for protection under

a statutory exception or regulatory safe harbor.

Failure to meet all of the requirements of a particular applicable statutory exception

or regulatory safe harbor does not make the conduct per se illegal under the AKS.

Instead, the legality of the arrangement will be evaluated

on a case-by-case basis based on a cumulative review of all of its facts and circumstances.

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.

and criminal false claims laws, including the FCA, and civil monetary penalty laws, which can be enforced through civil whistleblower

or qui tam actions, prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims

for payment of federal government funds, including in federal healthcare programs, that are false or fraudulent.

Pharmaceutical and other

healthcare companies have been prosecuted under these laws for engaging in a variety of different types of conduct that “caused”

the submission of false claims to federal healthcare programs.

Under the AKS, for example, a claim resulting from a violation of the

AKS is deemed to be a false or fraudulent claim for purposes of the FCA.

created additional federal criminal statutes that prohibit, among other things, executing a scheme to defraud any healthcare benefit

program, including private third-party payors, and making false statements relating to healthcare matters.

A person or entity does not

need to have actual knowledge of the healthcare fraud statute implemented under HIPAA or specific intent to violate the statute in order

to have committed a violation.

FDCA addresses, among other things, the design, production, labeling, promotion, manufacturing, and testing of drugs, biologics and medical

devices, and prohibits such acts as the introduction into interstate commerce of adulterated or misbranded drugs or devices.

also prohibits the introduction into interstate commerce of unlicensed or mislabeled biological products.

federal Physician Payments Sunshine Act requires certain manufacturers of drugs, devices, biologics and medical supplies for which

payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to annually

report to the Centers for Medicaid & Medicare Services (“CMS”) information related to payments or other transfers of

value to various healthcare professionals including physicians, physician assistants, nurse practitioners, clinical nurse specialists,

certified nurse anesthetists, certified nurse-midwives, and teaching hospitals, as well as ownership and investment interests held by

physicians and their immediate family members.

Beginning on January 1, 2023, California Assembly Bill 1278 requires California physicians

and surgeons to notify patients of the Open Payments database established under the federal Physician Payments Sunshine Act.

are also subject to federal price reporting laws and federal consumer protection and unfair competition laws.

Federal price reporting

laws require manufacturers to calculate and report complex pricing metrics to government programs, where such reported prices may be

used in the calculation of reimbursement and/ or discounts on approved products.

Federal consumer protection and unfair competition laws

broadly regulate marketplace activities and activities that potentially harm consumers.

are also subject to additional similar U.S.

state and foreign law equivalents of each of the above federal laws, which, in some cases,

differ from each other in significant ways, and may not have the same effect, thus complicating compliance efforts.

If our operations

are found to be in violation of any of such laws or any other governmental regulations that apply, we may be subject to penalties, including,

without limitation, civil, criminal and administrative penalties, damages, fines, exclusion from government-funded healthcare programs,

such as Medicare and Medicaid or similar programs in other countries or jurisdictions, integrity oversight and reporting obligations

to resolve allegations of non-compliance, disgorgement, individual imprisonment, contractual damages, reputational harm, diminished profits

and the curtailment or restructuring of our operations.

Privacy and Security

state, federal, and foreign laws govern the collection, dissemination, use, access to, confidentiality, and security of personal information,

including health-related information.

In the United States, numerous federal and state laws and regulations, including state data breach

notification laws, state health information privacy laws, and federal and state consumer protection laws and regulations, govern the

collection, use, disclosure, and protection of health-related and other personal information could apply to our operations or the operations

of our partners.

For example, HIPAA, as amended by the Health Information Technology for Economic and Clinical Health (“HITECH”),

and their respective implementing regulations imposes data privacy, security, and breach notification obligations on certain health care

providers, health plans, and health care clearinghouses, known as covered entities, as well as their business associates and their covered

subcontractors that perform certain services that involve using, disclosing, creating, receiving, maintaining, or transmitting individually

identifiable protected health information (“PHI”) for or on behalf of such covered entities.

These requirements imposed by

HIPAA and the HITECH Act on covered entities and business associates include entering into agreements that require business associates

protect PHI provided by the covered entity against improper use or disclosure, among other things;

following certain standards for the

privacy of PHI, which limit the disclosure of a patient’s past, present, or future physical or mental health or condition or information

about a patient’s receipt of health care if the information identifies, or could reasonably be used to identify, the individual;

ensuring the confidentiality, integrity, and availability of all PHI created, received, maintained, or transmitted in electronic form,

to identify and protect against reasonably anticipated threats or impermissible uses or disclosures to the security and integrity of

and reporting of breaches of PHI to individuals and regulators.

Entities that are found to be in violation of HIPAA may be

subject to significant civil, criminal, and administrative fines and penalties and/or additional reporting and oversight obligations

if required to enter into a resolution agreement and corrective action plan with the U.S.

Department of Health and Human Services (“HHS”)

to settle allegations of HIPAA non-compliance.

A covered entity or business associate is also liable for civil money penalties for a

violation that is based on an act or omission of any of its agents, which may include a downstream business associate, as determined

according to the federal common law of agency.

HITECH also increased the civil and criminal penalties applicable to covered entities

and business associates and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts

to enforce HIPAA and seek attorneys’ fees and costs associated with pursuing federal civil actions.

To the extent that we submit

electronic healthcare claims and payment transactions that do not comply with the electronic data transmission standards established

under HIPAA and HITECH, payments to us may be delayed or denied.

addition, state health information privacy laws, such as California’s Confidentiality of Medical Information Act and Washington’s

My Health My Data Act, govern the privacy and security of health-related information, specifically, may apply even when HIPAA does not

and impose additional requirements.

when HIPAA and state health information privacy laws do not apply, according to the FTC and state Attorneys General, violating consumers’

privacy rights or failing to take appropriate steps to keep consumers’ personal information secure may constitute unfair acts or

practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act and state consumer protection laws.

addition, certain state laws, such as the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act of

2020 (“CCPA”), govern the privacy and security of personal information, including health-related information in certain circumstances,

some of which are more stringent than HIPAA in various ways.

Numerous other states have passed similar laws, but many differ from each

other in significant ways and may not have the same effect, thus complicating compliance efforts.

The CCPA applies to personal data of

consumers, business representatives, and employees, and imposes obligations on certain businesses that do business in California, including

to provide specific disclosures in privacy notices, and affords rights to California residents in relation to their personal information.

Health information falls under the CCPA’s definition of personal information where it identifies, relates to, describes, or is

reasonably capable of being associated with or could reasonably be linked, directly or indirectly, with a particular consumer or household

- unless it is subject to HIPAA - and is included under a new category of personal information, “sensitive personal information,”

which is offered greater protection.

The numerous other comprehensive privacy laws that have passed or are being considered in other

states, as well as at the federal and local levels, also exempt some data processed in the context of clinical trials;

but others exempt

covered entities and business associates subject to HIPAA altogether, further complicating compliance efforts, and increasing legal risk

and compliance costs for us and the third parties upon whom we rely.

Additionally, our use of artificial intelligence and machine learning

may be subject to laws and evolving regulations regarding the use of artificial intelligence/machine learning, controlling for data bias,

and antidiscrimination.

to comply with these laws, where applicable, can result in the imposition of significant civil and/or criminal penalties and private

Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate

compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties

and restrictions on data processing.

and Reimbursement

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

associated with their treatment.

Adequate coverage and reimbursement from governmental healthcare programs, such as Medicare and Medicaid,

and commercial payors is critical to new product acceptance.

Our ability to successfully commercialize our product candidates will depend

in part on the extent to which coverage and adequate reimbursement for these products and related treatments will be available from government

health administration authorities, private health insurers and other organizations.

Even if coverage is provided, the approved reimbursement

amount may not be high enough to allow it to establish or maintain pricing sufficient to realize a sufficient return on its investment.

Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which medications

they will pay for and establish reimbursement levels.

uncertainty exists as to the coverage and reimbursement status of any pharmaceutical or biological product for which we obtain regulatory

Sales of any product, if approved, depend, in part, on the extent to which such product will be covered by third-party payors,

such as federal, state, and foreign government healthcare programs, commercial insurance and managed healthcare organizations, and the

level of reimbursement, if any, for such product by third-party payors.

Decisions regarding whether to cover any of our product candidates,

if approved, the extent of coverage and amount of reimbursement to be provided are made on a plan-by-plan basis.

Further, no uniform

policy for coverage and reimbursement exists in the United States, and coverage and reimbursement can differ significantly from payor

Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement rates,

but also have their own methods and approval process apart from Medicare determinations.

As a result, the coverage determination process

is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our product

candidates to each payor separately, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained

in the first instance.

Factors payors consider in determining reimbursement are based on whether the product is:

such products are manufactured, pose significant hurdles to implementation and the FDA has issued guidance documents intended

to inform prospective applicants and facilitate the development of proposed biosimilars and interchangeable biosimilars, as well as to

describe the FDA’s interpretation of certain statutory requirements added by the BPCIA.

Under the BPCIA, an application

for a biosimilar product may not be submitted to the FDA until four years following the date that the reference product was first licensed

In addition, the approval of a biosimilar product may not be made effective by the FDA until 12 years from the date on which

the reference product was first licensed.

During this 12-year period of exclusivity, another company may still market a competing version

of the reference product if the FDA approves a full BLA for the competing product containing that applicant’s own preclinical data

and data from adequate and well-controlled clinical trials to demonstrate the safety, purity, and potency of its product.

The BPCIA also

created certain exclusivity periods for biosimilars approved as interchangeable products.

Additionally, many states have passed laws concerning

the ability of pharmacies to substitute biosimilar and interchangeable products for the reference product.

A reference biologic is granted twelve years of exclusivity from the

time of first licensure (BLA approval) of the reference product.

The first biologic product submitted under the abbreviated approval pathway

that is determined to be interchangeable with the reference product has exclusivity against other biologics submitted under the abbreviated

approval pathway for the lesser of (i) one year after the first commercial marketing, (ii) 18 months after approval if there is no legal

challenge, (iii) 18 months after the resolution in the applicant’s favor of a lawsuit challenging the biologics’ patents if

an application has been submitted, or (iv) 42 months after the application has been approved if a lawsuit is ongoing within the 42-month

A biological product can also obtain pediatric market exclusivity in

the United States.

Pediatric exclusivity, if granted, adds six months to existing exclusivity periods and patent terms.

This six-month

exclusivity, which runs from the end of other exclusivity protection or patent term, may be granted based on the voluntary completion

of a pediatric study in accordance with an FDA-issued “Written Request” for such a study.

As discussed below, the Inflation

Reduction Act of 2022 (“IRA”) is a significant new law that intends to foster generic and biosimilar competition and to lower

drug and biologic costs.

Patent Term Extension

In the United States, after a BLA is approved, owners of relevant drug

patents may apply for up to a five-year patent extension, which permits patent term restoration as compensation for the patent term lost

during the FDA regulatory process.

The allowable patent term extension is typically calculated as one-half the time between, the latter

of the effective date of an IND and issue date of the patent for which extension is sought, and the submission date of a BLA, plus the

time between BLA submission date and the BLA approval date up to a maximum of five years.

The time can be shortened if the FDA determines

that the applicant did not pursue licensure with due diligence.

The total patent term after the extension may not exceed 14 years from

the date of product licensure.

Only one patent applicable to a licensed biological product is eligible for extension and only those claims

covering the product, a method for using it, or a method for manufacturing it may be extended and the application for the extension must

be submitted prior to the expiration of the patent in question.

However, a company may not be granted an extension because of, for example,

failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines,

failing to apply prior to expiration of relevant patents, or otherwise failing to satisfy applicable requirements.

Some, but not all,

foreign jurisdictions possess patent term extension or other additional patent exclusivity mechanisms that may be more or less stringent

and comprehensive than those of the United States.

Other Healthcare Laws and Compliance Requirements

Biopharmaceutical manufacturers,

particularly manufacturers of marketed products, are subject to healthcare regulation and enforcement by federal, state, and local government

authorities in the U.S., as well as by foreign jurisdictions.

Biopharmaceutical manufacturers must comply with various federal, state,

and local laws targeting fraud and abuse in the healthcare industry, including anti-kickback and false claims laws.

The federal Anti-Kickback

Statute (“AKS”) generally prohibits, among other things, a pharmaceutical manufacturer from directly or indirectly soliciting,

offering, receiving, or paying any remuneration, in cash or in kind, where one purpose is either to induce the referral of an individual

for, or the purchase or prescription of, a particular drug that is payable by a federal health care program, including Medicare or Medicaid.

A person or entity does not need to have actual knowledge of the statute or a specific intent to violate the statute.

There are a number of statutory

exceptions and regulatory safe harbors protecting some common activities from prosecution, but protection is available only if all requirements

Our practices may not in all cases meet all of the criteria for protection under a statutory exception or regulatory safe harbor.

Failure to meet all of the requirements of a particular applicable statutory exception or regulatory safe harbor does not make the conduct

per se illegal under the statute.

Instead, the legality of the arrangement will be evaluated on a case-by-case basis based on a cumulative

review of all of its facts and circumstances.

A claim arising from a violation of the federal Anti-Kickback Statute also constitutes a

fraudulent claim for purposes of the False Claims Act (“FCA”).

Other federal and state anti-kickback statutes exist.

another healthcare anti-kickback statute prohibits certain payments related to referrals of patients to certain providers (such as clinical

laboratories) and applies to services reimbursed by private health plans as well as government health care programs.

Federal and state false claims laws, such as the FCA, generally prohibit

anyone from knowingly and willfully, among other activities, presenting or causing to be presented, payment to third party payors (including

Medicare and Medicaid) claims for drugs or services that are false or fraudulent.

Pharmaceutical and other healthcare companies have been

prosecuted under these laws for engaging in a variety of different types of conduct that “caused” the submission of false

claims to federal healthcare programs.

Such laws are not always limited to activities involving government programs or payors.

a federal healthcare fraud statute prohibits the knowing and willful execution, or attempt to execute, a scheme to defraud a health care

benefit program, including private health plans, or obtain, through false or fraudulent pretenses, money or property owned by, or under

the custody or control of, such a health care benefit program.

Laws and regulations have also been enacted by the federal government and

various states to regulate the sales and marketing practices of pharmaceutical manufacturers.

The laws and regulations generally limit

financial interactions between manufacturers and health care providers;

require pharmaceutical companies to comply with the pharmaceutical

industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S.

federal government;

require disclosure to the government and/or public of financial interactions (so-called “sunshine laws” and “sunshine

State and local laws may also require disclosure of pharmaceutical pricing information and marketing expenditures or

licensure of sales representatives.

Manufacturers must also submit information to the FDA on the identity and quantity of drug samples

requested and distributed by a manufacturer during each year.

Biopharmaceutical manufacturers

are also subject to federal pricing and price reporting laws.

Such laws require manufacturers to calculate and report complex pricing

metrics to government programs, where such reported prices may be used in the calculation of reimbursement and/ or discounts on approved

The laws may also require biopharmaceutical manufacturers to offer products at discounted prices to specific government programs

or specific purchasers as a condition for participation in certain government health benefit programs.

Federal consumer protection and

unfair competition laws broadly regulate marketplace activities and activities that potentially harm consumers.

The distribution of biological products is subject to additional requirements

and regulations, including extensive record-keeping, licensing, storage, and security requirements intended to prevent the unauthorized

sale of such products.

Sanctions for the violation of healthcare laws vary by law but may be significant and compliance is challenging.

For example, violations of fraud and abuse laws may be punishable by criminal or civil sanctions, including fines and civil monetary penalties,

and/or exclusion from federal health care programs (including Medicare and Medicaid).

The scope of the federal and the various analogous

state anti-kickback, false claims, and similar fraud and abuse laws vary, but is generally broad.

Many of the fraud and abuse laws and

regulations contain ambiguous requirements or require administrative guidance for implementation.

Federal and state authorities are paying

increased attention to enforcement of these laws within the pharmaceutical industry, and private individuals have been active in alleging

violations of the laws and bringing suits on behalf of the government under the FCA as evidenced by numerous significant settlements.

Violations of international fraud and abuse laws could result in similar penalties, including exclusion from participation in health programs

outside the U.S.

Data Privacy and Security

Biopharmaceutical companies

are subject to numerous and evolving U.S.

federal and state laws and regulations governing the collection, use, disclosure, transfer,

and security of personal information, including health-related information, any of which may impose operational constraints, create compliance

complexity, and increase enforcement and litigation exposure.

federal and state frameworks include HIPAA, as amended by the Health

Information Technology for Economic and Clinical Health Act (“HITECH”), and its implementing regulations (including the Privacy,

Security, Breach Notification, and Enforcement Rules), state health information privacy laws, state data breach notification laws, a growing

number of state comprehensive consumer privacy laws, as well as other consumer protection laws and regulations that could apply to our

operations or the operations of our partners.

Certain sector and data specific laws, including those governing marketing communications,

data security, and the sale or transfer of certain categories of sensitive data, as well as evolving state tort and other common law restrictions

that may govern privacy and data security practices may be tested by the court system and enforced by enforcement authorities, may apply

to parts of our operations as well as to the operations of our partners.

HIPAA imposes standards for the privacy of protected health information

(“PHI”), the security of electronic PHI, breach notification to individuals and regulators, and enforcement.

HIPAA applies

directly to “covered entities” (health care providers, health plans, and health care clearinghouses), as well as their “business

associates” and their covered subcontractors that perform certain services that involve using, disclosing, creating, receiving,

maintaining, or transmitting individually identifiable PHI for or on behalf of such covered entities.

Requirements imposed by HIPAA on

covered entities and business associates include:

(i) entering into agreements that require business associates and their covered subcontracts

to protect PHI provided by the covered entity against improper use or disclosure;

(ii) complying with HIPAA privacy standards that limit

the use and disclosure of information about a patient’s past, present, or future physical or mental health condition, or the patient’s

receipt of health care, where the information identifies, or could reasonably be used to identify, the individual;

(iii) implementing

administrative, physical, and technical safeguards to ensure the confidentiality, integrity, and availability of electronic PHI and to

protect against reasonably anticipated threats, hazards, or impermissible uses or disclosure;

and (iv) reporting of breaches of unsecured

PHI to affected individuals and, where applicable, regulators.

Entities that violate HIPAA may face substantial civil, criminal, and administrative

penalties, additional reporting and oversight obligations, and may be required to enter into resolution agreements and corrective action

plans with the U.S.

Department of Health and Human Services.

Covered entities and business associates can also be held liable for violations

committed by their agents, including downstream business associates, and HITECH has increased applicable penalties and authorized state

attorneys general to bring civil action in federal court to enforce HIPAA and seek damages, injunctive relief and attorneys’ fees.

In addition, several states

have enacted or are implementing health data specific statutes outside HIPAA that broadly regulate the collection, use, and disclosure

of “consumer health data” including certain research analytics, website, and marketing activities.

These laws may impose consent,

notice, contract, and data security obligations, create limitations on sharing with third parties and processors, and provide private

rights of action or enhanced enforcement, which could affect aspects of our operations.

Even when HIPAA and state health information privacy

laws do not apply, according to the FTC and state Attorneys General, violating consumers’ privacy rights or failing to take appropriate

steps to keep consumers’ personal information secure may constitute unfair acts or practices in or affecting commerce in violation

of Section 5(a) of the Federal Trade Commission Act and state consumer protection laws.

In addition, certain state

laws, such as the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act of 2020 (“CCPA”)

and other comprehensive state privacy laws, together with their implementing regulations, establish individual rights regarding personal

information, impose notice, purpose-limitation, data minimization, and security obligations, and require specific contracts with service

providers and other third parties.

Some of these laws also require honoring opt-out signals for targeted advertising or certain profiling,

restrict processing of “sensitive” personal information, and mandate assessments for higher-risk processing activities.

and exemptions vary by state:

for example, the CCPA applies to personal information of consumers, business representatives, and employees,

includes additional protections for “sensitive personal information”, and generally excludes PHI subject to HIPAA;

may exempt entities regulated by HIPAA or data processed in the context of clinical trials, or neither, which complicates compliance and

increases legal risks and costs.

Other state data breach notification statutes, like the New York SHIELD Act, require notification to

affected individuals and, in some cases, regulators and consumer reporting agencies following certain security incidents.

Use of artificial intelligence (“AI”) and machine learning

technologies in research, analytics, and business operations is subject to a rapidly evolving legal and regulatory landscape.

and state authorities are increasingly focused on the responsible use of AI, including requirements for transparency, accountability,

and the mitigation of algorithmic bias and discrimination.

Several states have enacted or are considering laws that regulate the use of

AI in processing personal information, mandate impact assessments for high-risk AI applications, and require disclosures regarding automated

decision-making.

We may be required to implement measures to assess and address potential biases in AI models, ensure explainability and

fairness, and provide individuals with rights regarding automated processing of their data.

In addition, federal agencies such as the

FDA have issued guidance on the use of AI in medical device development and clinical research, which may impact our business.

As regulatory

expectations continue to develop, we may need to update our policies, procedures, and technical controls to ensure compliance with AI-related

requirements.

The requirements of these laws and regulations continue to develop, and new laws, amendments, or interpretive guidance may

require us to modify our practices.

Coverage and Reimbursement

and other countries,

patients generally rely on third-party payors to reimburse all or part of the costs associated with their treatment.

Adequate coverage

and reimbursement from government healthcare programs, such as Medicare and Medicaid, and private payors are critical to new product acceptance.

Our ability to successfully commercialize our product candidates, if and when approved, will depend in part on the extent to which coverage

and adequate reimbursement for these products and related treatments will be available from government healthcare programs, private health

insurers, and other organizations.

Within the U.S., no uniform policy for coverage and reimbursement exists

and coverage and reimbursement for drugs products can differ significantly from payor to payor, and a third party payor’s decision

to cover a particular drug product does not ensure that other payors will also provide coverage for that drug product.

Factors payors

may consider in determining coverage include whether the product is:

covered benefit under its health plan;

2 unchanged sentences

experimental nor investigational.

payors are increasingly challenging the prices charged for medical products and services, examining the medical necessity and reviewing

the cost effectiveness of pharmaceutical or biological products, medical devices and medical services, in addition to questioning safety

and efficacy.

Adoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with

existing controls and measures, could further limit sales of any product that receives approval.

Decreases in third-party reimbursement

for any product or a decision by a third-party not to cover a product could reduce physician usage and patient demand for the product.

products administered under the supervision of a physician, obtaining coverage and adequate reimbursement may be particularly difficult

because of the higher prices often associated with such drugs.

Additionally, separate reimbursement for the product itself or the treatment

or procedure in which the product is used may not be available, which may impact physician utilization.

In addition, companion diagnostic

tests require coverage and reimbursement separate and apart from the coverage and reimbursement for their companion pharmaceutical or

biological products.

Similar challenges to obtaining coverage and reimbursement, applicable to pharmaceutical or biological products,

will apply to companion diagnostics.

addition, the U.S.

government, state legislatures and foreign governments have continued implementing cost-containment programs, including

price controls, restrictions on coverage and reimbursement and requirements for substitution of generic products.

The IRA provides CMS

with significant new authorities intended to curb drug costs and to encourage market competition.

For the first time, CMS will be able

to directly negotiate prescription drug prices and to cap out-of-pocket costs.

Each year, CMS will select and negotiate a preset number

of high-spend drugs and biologics that are covered under Medicare Part B and Part D that do not have generic or biosimilar competition.

On August 29, 2023, HHS announced the list of the first ten drugs subject to price negotiations.

These price negotiations occurred in

In January 2025, CMS announced a list of 15 additional Medicare Part D drugs that will be subject to price negotiations.

also provides a new “inflation rebate” covering Medicare patients that took effect in 2023 and is intended to counter certain

price increases in prescriptions drugs.

The inflation rebate provision requires drug manufacturers to pay a rebate to the federal government

if the price for a drug or biologic under Medicare Part B and Part D increases faster than the rate of inflation.

To support biosimilar

competition, beginning in October 2022, qualifying biosimilars may receive a Medicare Part B payment increase for a period of five years.

Separately, if a biologic drug for which no biosimilar exists delays a biosimilar’s market entry beyond two years, CMS will be

authorized to subject the biologics manufacturer to price negotiations intended to ensure fair competition.

Notwithstanding these provisions,

the IRA’s impact on commercialization and competition remains largely uncertain.

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

payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices

than in the United States.

Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts

from list prices and are challenging the prices charged for medical products.

We cannot be sure that reimbursement will be available

for any product candidate that we may commercialize and, if reimbursement is available, the level of reimbursement.

In addition, many

pharmaceutical manufacturers must calculate and report certain price reporting metrics to the government, such as average sales price

and best price.

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

Further, these prices for

drugs may be reduced by mandatory discounts or rebates required by government healthcare programs.

in some foreign countries, the proposed pricing for a drug must be approved before it may be lawfully marketed.

The requirements governing

drug pricing vary widely from country to country.

For example, the European Union (“EU”) provides options for its member

states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control

the prices of medicinal products for human use.

To obtain reimbursement or pricing approval, some of these countries may require the

completion of clinical trials that compare the cost effectiveness of a particular product candidate to currently available therapies.

A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls

on the profitability of the company placing the medicinal product on the market.

There can be no assurance that any country that has

price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for

any of our product candidates.

Historically, products launched in the EU do not follow price structures of the United States and generally

prices tend to be significantly lower.

United States and some foreign jurisdictions are considering or have enacted a number of reform proposals to change the healthcare system.

There is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving

quality or expanding access.

In the United States, the pharmaceutical industry has been a particular focus of these efforts and has been

significantly affected by federal and state legislative initiatives, including those designed to limit the pricing, coverage, and reimbursement

of pharmaceutical and biopharmaceutical products, especially under government-funded health care programs, and increased governmental

control of drug pricing.

ACA, which was enacted in March 2010, substantially changed the way healthcare is financed by both governmental and private insurers

in the United States, and significantly affected the pharmaceutical industry.

The ACA contains a number of provisions of particular import

to the pharmaceutical and biotechnology industries, including, but not limited to, those governing enrollment in federal healthcare programs,

a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled,

infused, instilled, implanted or injected, and annual fees based on pharmaceutical companies’ share of sales to federal health

care programs.

Since its enactment, there have been judicial and Congressional challenges to certain aspects of the ACA, and we expect

there will be additional challenges and amendments to the ACA in the future.

For example, the IRA, among other things, extends enhanced

subsidies for individuals purchasing health insurance coverage in ACA marketplaces through plan year 2025.

The IRA also eliminates the

“donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket

cost and creating a new manufacturer discount program.

legislative changes have been proposed and adopted since the ACA was enacted, including automatic aggregate reductions of Medicare payments

to providers of on average 2% per fiscal year as part of the federal budget sequestration under the Budget Control Act of 2011.

reductions went into effect in April 2013 and, due to subsequent legislative amendments, will remain in effect until 2032 unless additional

action is taken by Congress.

addition, the Bipartisan Budget Act of 2018, among other things, amended the Medicare Act (as amended by the ACA) to increase the point-of-sale

discounts that manufacturers must agree to offer under the Medicare Part D coverage discount program from 50% to 70% off negotiated prices

of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient

drugs being covered under Medicare Part D.

there has recently been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products,

which has resulted in several Congressional inquiries and proposed and enacted federal and state measures designed to, among other things,

reduce the cost of prescription drugs, bring more transparency to product pricing, review the relationship between pricing and manufacturer

patient programs, and reform government program reimbursement methodologies for drug products.

For example, in May 2019, CMS adopted

a final rule allowing Medicare Advantage Plans the option to use step therapy for Part B drugs, permitting Medicare Part D plans to apply

certain utilization controls to new starts of five of the six protected class drugs, and requiring the Explanation of Benefits for Part

D beneficiaries to disclose drug price increases and lower cost therapeutic alternatives, which went into effect on January 1, 2021.

In response to the Biden administration’s October 2022 executive order, on February 14, 2023, HHS released a report outlining three

new models for testing by the CMS Innovation Center which will be evaluated on their ability to lower the cost of drugs, promote accessibility,

and improve quality of care.

It is unclear whether the models will be utilized in any health reform measures in the future.

on December 7, 2023, the Biden administration announced an initiative to control the price of prescription drugs through the use of march-in

rights under the Bayh-Dole Act.

On December 8, 2023, the National Institute of Standards and Technology published for comment a Draft

Interagency Guidance Framework for Considering the Exercise of March-In Rights which for the first time includes the price of a product

as one factor an agency can use when deciding to exercise march-in rights.

While march-in rights have not previously been exercised,

it is uncertain if that will continue under the new framework.

Notwithstanding

the IRA, continued legislative and enforcement interest exists in the United States with respect to specialty drug pricing practices.

Specifically, we expect regulators to continue pushing for transparency to drug pricing, reducing the cost of prescription drugs under

Medicare, reviewing the relationship between pricing and manufacturer patient programs, and reforming government program reimbursement

methodologies for drugs.

states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control

pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain

drug access and marketing cost disclosure and transparency measures, and designed to encourage importation from other countries and bulk

Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, financial

condition, results of operations and prospects.

In addition, regional healthcare authorities and individual hospitals are increasingly

using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and

other healthcare programs.

This could reduce the ultimate demand for its drugs or put pressure on its drug pricing, which could negatively

affect our business, financial condition, results of operations and prospects.

Government Regulation Outside of the United States

addition to regulations in the United States, we are subject to a variety of regulations in other jurisdictions governing, among other

things, research and development, clinical trials, testing, manufacturing, safety, efficacy, quality control, labeling, packaging, storage,

record keeping, distribution, reporting, export and import, advertising, marketing and other promotional practices involving biological

products as well as authorization, approval as well as post-approval monitoring and reporting of our products.

Because biologically sourced

raw materials are subject to unique contamination risks, their use may be restricted in some countries.

or not we obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in foreign countries

prior to the commencement of clinical trials or marketing of the product in those countries.

Certain countries outside of the United

States have a similar process that requires the submission of a clinical trial application much like the IND prior to the commencement

of human clinical trials.

requirements and process governing the conduct of clinical trials, including requirements to conduct additional clinical trials, product

licensing, safety reporting, post-authorization requirements, marketing and promotion, interactions with healthcare professionals, pricing

and reimbursement may vary widely from country to country.

No action can be taken to market any product in a country until an appropriate

approval application has been approved by the regulatory authorities in that country.

The current approval process varies from country

to country, and the time spent in gaining approval varies from that required for FDA approval.

In certain countries, the sales price

of a product must also be approved.

The pricing review period often begins after market approval is granted.

Even if a product is approved

by a regulatory authority, satisfactory prices may not be approved for such product, which would make launch of such products commercially

unfeasible in such countries.

in the European Union

collection and use of personal health data and other personal data in the EU is governed by the provisions of the European General Data

Protection Regulation (EU) 2016/679 (“GDPR”), which came into force in May 2018, and related data protection laws in individual

EU Member States.

The GDPR imposes a number of strict obligations and restrictions on the ability to process, including collecting, analyzing

and transferring, personal data of individuals, in particular with respect to health data from clinical trials and adverse event reporting.

The GDPR includes requirements relating to the legal basis of the processing (such as consent of the individuals to whom the personal

data relates), the information provided to the individuals prior to processing their personal data, the personal data breaches which

may have to be notified to the national data protection authorities and data subjects, the measures to be taken when engaging processors,

and the security and confidentiality of the personal data.

EU Member States may also impose additional requirements in relation to health,

genetic and biometric data through their national legislation.

addition, the GDPR imposes specific restrictions on the transfer of personal data to countries outside of the European Economic Area

(“EEA”) that are not considered by the European Commission (“EC”) to provide an adequate level of data protection.

Third-party payors are increasingly challenging the prices charged

for pharmaceutical or biological products and related services, examining the medical necessity and reviewing the cost effectiveness of

such products and services.

For products administered under the supervision of a physician, inadequate reimbursement for the product itself

or the treatment or procedure in which the product is used may adversely impact physician utilization.

Adoption of price controls and

cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further

limit sales of any product that receives approval.

Decreases in third-party reimbursement for any product or a decision by a third-party

not to cover a product could reduce physician usage and patient demand for the product.

Finally, in some foreign countries, the proposed pricing for a drug

must be approved before it may be lawfully marketed.

The requirements governing drug pricing vary widely from country to country.

example, drug pricing in the European Union (“EU”) is primarily at the national level, with each member state setting its

own prices and reimbursement rules.

To obtain reimbursement or pricing approval, countries may require the completion of clinical trials

to establish relative clinical effectiveness to guide cost effectiveness assessment of anew treatment method to currently available therapies.

A member state may approve a specific price for the medicinal product or implement a system of direct or indirect controls on the profitability

of the company placing the medicinal product on the market.

There can be no assurance that any country that has price controls or reimbursement

limitations for pharmaceutical products will grant favorable reimbursement and pricing arrangements for any of our product candidates.

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

Healthcare Reform

The United States and some

foreign jurisdictions are considering or have enacted a number of reform proposals to change the healthcare system.

There is significant

interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality or expanding

The ACA, which was enacted

in March 2010, substantially changed the way healthcare is financed by both governmental and private insurers in the United States, and

significantly affected the pharmaceutical industry.

The ACA contains a number of provisions of particular import to the pharmaceutical

and biotechnology industries, including, but not limited to, those governing enrollment in federal healthcare programs, a new methodology

by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled,

implanted or injected, and annual fees based on pharmaceutical companies’ share of sales to federal health care programs.

its enactment, there have been judicial and Congressional challenges to certain aspects of the ACA, and we expect there will be additional

challenges and amendments to the ACA in the future.

In the U.S., in recent years,

the pharmaceutical industry has been a particular focus of healthcare reform efforts and has been significantly affected by major legislative,

administrative and executive initiatives.

For example, the Inflation Reduction Act of 2022 (IRA) included a number of changes intended

to address rising prescription drug prices in Medicare Parts B and D.

These changes included caps on Medicare Part D out-of-pocket costs,

Medicare Part B and Part D drug price inflation rebates, a new Medicare Part D manufacturer discount drug program (replacing the previous

coverage gap discount program) and a drug price negotiation program for certain high-spend Medicare Part B and D drugs.

The IRA has had

and will likely continue to have a significant impact on the pharmaceutical industry.

Beyond the IRA, changes to Medicaid effective in

2024 eliminated the Medicaid rebate cap.

Additionally, changes to certain Medicare price reporting requirements for drugs beginning in

2026 will likely increase the administrative and compliance burden for manufacturers.

Recently, drug pricing and

payment has been subject to a number of reform initiatives.

For example, President Trump issued an Executive Order in April 2025 with

multiple directives aimed at lowering drug prices, including refining the Medicare drug price negotiation program established by the IRA;

accelerating competition for high-cost prescription drugs by accelerating approval of generics and biosimilars and facilitating the process

for re-classifying prescription drugs as over-the-counter drugs;

and increasing drug importation.

In May 2025, President Trump issued

another Executive Order that directed government agencies and officials to identify most-favored nation pricing targets for prescription

drugs (and looked to pharmaceutical manufacturers to make significant progress towards delivering target prices to patients);

foreign countries from disproportionately shifting the cost of global pharmaceutical research and development to the United States;

facilitate direct-to-consumer purchasing programs for pharmaceutical manufacturers to sell their products to patients at the most-favored-nation

In the wake of the Executive Orders and related executive initiatives, a number of pharmaceutical manufacturers have announced

direct-to-consumer offerings with discounted prices and/or reached agreement with the federal government regarding pricing for drugs,

including prices for Medicaid drugs and newly launched products.

A website sponsored by the federal government that is anticipated to

offer pharmaceutical direct-to-consumer channels has also been announced.

Federal agencies are developing new drug pricing pilot programs,

such as a voluntary Medicaid initiative which would authorize the federal government to negotiate Medicaid supplemental rebates with participating

manufacturers on behalf of state Medicaid programs, in exchange for standardized coverage criteria for participating manufacturer drugs,

and the proposed Medicare Part B and Part D pilot models that, if finalized as proposed, would replace existing inflation-based Medicare

rebates with rebates determined on the basis of international prices, for drugs and patients subject to the model.

Many of these reform

initiatives would require additional legal and/or administrative action to implement and may be subject to legal challenge.

At the state level, individual

states are increasingly implementing initiatives designed to control pharmaceutical and biological product pricing, including price or

patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures,

and measures to encourage importation from other countries and bulk purchasing.

For example, certain states have formed Prescription Drug

Affordability Boards that assert authority to set reimbursement rates and/or drug pricing in the state.

States are also increasingly expanding

or changing Medicaid supplemental rebate programs to secure additional rebates from manufacturers in exchange for drug coverage and to

limit coverage of certain drugs for certain Medicaid patients or to all Medicaid patients.

These and other future state-level reform activities

could negatively affect Medicaid coverage and reimbursement for our products.

Other recent government actions also may affect prices or payments

for prescription drugs.

For example, the Trump Administration’s recently announced tariff on branded or patented drugs may adversely

impact our ability to realize an adequate return on the sale of drug products (if approved) that are imported from abroad or manufactured

using products or materials imported from abroad.

The timeline for implementation of this tariff has not yet been finalized.

example, the Budget Control Act of 2011, as amended, resulted in the imposition of reductions in Medicare (but not Medicaid) payments

to providers in 2013 and will remain in effect into 2032 unless additional Congressional action is taken.

Any significant spending reductions

affecting Medicare, Medicaid or other publicly funded or subsidized health programs that may be implemented and/or any significant taxes

or fees that may be imposed on us could have an adverse impact on our results of operations.

Moreover, there has recently been heightened governmental scrutiny

over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and

proposed and enacted federal and state measures designed to, among other things, reduce the cost of prescription drugs, bring more transparency

to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement

methodologies for drug products.

For example, in May 2019, CMS adopted a final rule allowing Medicare Advantage Plans the option to use

step therapy for Part B drugs, permitting Medicare Part D plans to apply certain utilization controls to new starts of five of the six

protected class drugs, and requiring the Explanation of Benefits for Part D beneficiaries to disclose drug price increases and lower cost

therapeutic alternatives, which went into effect on January 1, 2021.

Other Government Regulation Outside of the

United States

In addition to regulations

in the United States, we are subject to a variety of regulations in other jurisdictions governing, among other things, research and development,

clinical trials, testing, manufacturing, safety, efficacy, quality control, labeling, packaging, storage, record keeping, distribution,

reporting, export and import, advertising, marketing and other promotional practices involving biological products as well as authorization,

approval as well as post-approval monitoring and reporting of our products.

Because biologically sourced raw materials are subject to

unique contamination risks, their use may be restricted in some countries.

Whether or not we obtain

FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in foreign countries prior to the commencement

of clinical trials or marketing of the product in those countries.

Certain countries outside of the United States have a similar process

that requires the submission of a clinical trial application much like the IND prior to the commencement of human clinical trials.

The requirements and process governing the conduct of clinical trials,

including requirements to conduct additional clinical trials, product licensing, safety reporting, post-authorization requirements, marketing

and promotion, interactions with healthcare professionals, pricing and reimbursement may vary widely from country to country.

can be taken to market any product in a country until an appropriate marketing approval has been granted by the regulatory authorities

in that country.

The current approval process varies from country to country, and the time spent in gaining approval may vary from that

required for FDA approval.

In certain countries, the sales price of a product must also be agreed or approved by payors or the respective

national health system before commercial launch.

The pricing review period often begins after marketing approval.

Although a product may

receive marketing approval from a regulatory authority, the price agreed upon during the review process may not be commercially sustainable

to justify a commercial launch in those countries.

Regulation in the European Union

European Data and Security Laws

The collection and use of

personal health data and other personal data in the EU is governed by the provisions of the European General Data Protection Regulation

(EU) 2016/679 (“GDPR”), which came into force in May 2018, and related data protection laws in individual EU Member States.

The GDPR imposes a number of strict obligations and restrictions on the ability to process, including collecting, analyzing and transferring,

personal data of individuals, in particular with respect to health data from clinical trials and adverse event reporting.

The GDPR includes

requirements relating to the legal basis of the processing (such as consent of the individuals to whom the personal data relates), the

information provided to the individuals prior to processing their personal data, the personal data breaches which may have to be notified

to the national data protection authorities and data subjects, the measures to be taken when engaging processors, and the security and

confidentiality of the personal data.

EU Member States may also impose additional requirements in relation to health, genetic and biometric

data through their national legislation.

In addition, the GDPR imposes specific restrictions on the transfer

of personal data to countries outside of the European Economic Area (“EEA”) that are not considered by the European Commission

(“EC”) to provide an adequate level of data protection.

Appropriate safeguards are required to enable such transfers.

Among the appropriate safeguards that can be used, the data exporter may

use the standard contractual clauses (“SCCs”).

When relying on SCCs, data exporters are also required to conduct a transfer

risk assessment to verify if anything in the law and/or practices of the third country may impinge on the effectiveness of the SCCs in

the context of the transfer at stake and, if so, to identify and adopt supplementary measures that are necessary to bring the level of

protection of the data transferred to the EU standard of essential equivalence.

Where no supplementary measure is suitable, the data

exporter should avoid, suspend or terminate the transfer.

With regard to the transfer of data from the EEA to the United States, on July

10, 2023, the EC adopted its adequacy decision for the EU-US Data Privacy Framework.

On the basis of the new adequacy decision, personal

data can flow from the EEA to U.S.

the appropriate safeguards that can be used, the data exporter may use the standard contractual clauses (“SCCs”).

on SCCs, data exporters are also required to conduct a transfer risk assessment to verify if anything in the law and/or practices of the

third country may impinge on the effectiveness of the SCCs in the context of the transfer at stake and, if so, to identify and adopt supplementary

measures that are necessary to bring the level of protection of the data transferred to the EU standard of essential equivalence.

no supplementary measure is suitable, the data exporter should avoid, suspend or terminate the transfer.

With regard to the transfer of

data from the EEA to the United States, on July 10, 2023, the EC adopted its adequacy decision for the EU-US Data Privacy Framework.

the basis of the new adequacy decision, personal data can flow from the EEA to U.S.

companies participating in the framework.

With regard to the transfer of data from the EU to the United

Kingdom (“UK”), personal data may freely flow from the EEA to the UK since the UK is deemed to have an adequate data protection

However, the adequacy decisions include a ’sunset clause’ which entails that the decisions will automatically expire

four years after their entry into force, unless renewed.

to comply with the requirements of the GDPR and the related national data protection laws of the EU Member States may result in significant

monetary fines for noncompliance of up to €20 million or 4% of the annual global revenues of the noncompliant company, whichever

is greater, other administrative penalties and a number of criminal offenses for organizations and, in certain cases, their directors

and officers, as well as civil liability claims from individuals whose personal data was processed.

Data protection authorities from

the different EU Member States may still implement certain variations, enforce the GDPR and national data protection laws differently,

and introduce additional national regulations and guidelines, which adds to the complexity of processing personal data in the EU.

there are specific requirements relating to processing health data from clinical trials, including public disclosure obligations provided

in the EU Clinical Trials Regulation No.

536/2014 (“CTR”), European Medical Agency (“EMA”) disclosure initiatives

and voluntary commitments by industry.

Failure to comply with these obligations could lead to government enforcement actions and significant

penalties against us, harm to our reputation, and adversely impact our business and operating results.

Additionally,

following the UK’s withdrawal from the EU and the EEA, companies also have to comply with the UK’s data protection laws (including

the UK GDPR (as defined in section 3(10) (as supplemented by section 205(4)) of the Data Protection Act 2018 (the “DPA 2018”)),

the DPA 2018, and related data protection laws in the UK).

Separate from the fines that can be imposed by the GDPR, the UK regime has

the ability to fine up to the greater of £17.5 million or 4% of global turnover.

are subject to specific transfer rules under the UK regime, which broadly mirror the GDPR rules.

On February 2, 2022, the UK Secretary

of State laid before the UK Parliament the international data transfer agreement (“IDTA”) and the international data transfer

addendum to the EC’s standard contractual clauses for international data transfers (Addendum) and a document setting out transitional

to the transfer of data from the EU to the United Kingdom (“UK”), personal data may freely flow from the EEA to the UK since

the EC deemed the UK to have an adequate data protection level, and these adequacy decisions were extended in December 2025, and are now

valid until December 27, 2031.

Failure to comply with the

requirements of the GDPR and the related national data protection laws of the EU Member States may result in significant monetary fines

for noncompliance of up to €20 million or 4% of the annual global revenues of the noncompliant company, whichever is greater, other

administrative penalties and a number of criminal offenses for organizations and, in certain cases, their directors and officers, as well

as civil liability claims from individuals whose personal data was processed.

Data protection authorities from the different EU Member

States may still implement certain variations, enforce the GDPR and national data protection laws differently, and introduce additional

national regulations and guidelines, which adds to the complexity of processing personal data in the EU.

Furthermore, there are specific requirements relating to processing

health data from clinical trials, including those related to public disclosure obligations provided in the EU Clinical Trials Regulation

536/2014 (“CTR”), European Medicines Agency (“EMA”), data transparency initiatives and voluntary commitments

Failure to comply with these obligations could lead to government enforcement actions and significant penalties against us,

harm to our reputation, and adversely impact our business and operating results.

Additionally, following the UK’s withdrawal from the EU and the

EEA, companies also have to comply with the UK’s data protection laws (including the UK GDPR (as defined in section 3(10) (as supplemented

by section 205(4)) of the Data Protection Act 2018 (the “DPA 2018”)), the DPA 2018, and related data protection laws in the

In June 2025, the UK’s Data (Use and Access) Act took effect, which introduces certain relatively minor amendments to the data

protection regime in the UK, and therefore creates slight divergences between the EU and UK Data protection regimes.

Separate from the

fines that can be imposed by the GDPR, the UK regime has the ability to fine up to the greater of £17.5 million or 4% of global

Companies are subject to specific transfer data sharing and transfer

rules under the UK regime which broadly mirror the GDPR rules.

We therefore also apply or rely on third parties to implement data sharing

and cross-border transfer mechanisms and safeguards, as set out above, in these contexts.

On February 2, 2022, the UK Secretary of State

laid before the UK Parliament the international data transfer agreement (“IDTA”) and the international data transfer addendum

to the EC’s standard contractual clauses for international data transfers (Addendum) and a document setting out transitional provisions.

The IDTA and Addendum came into force on March 21, 2022 and replaced the old SCCs for the purposes of the UK regime.

transfers from the UK to the EEA, personal data may flow freely since the EEA is deemed to have an adequate data protection level for

purposes of the UK regime.

With regard to the transfer of personal data from the UK to the United States, the UK government has adopted

an adequacy decision for the United States, the UK-US Data Bridge, which came into force on October 12, 2023.

The UK-US Data Bridge recognizes

the United States as offering an adequate level of data protection where the transfer is to a U.S.

company participating in the EU-US

Data Privacy Framework and the UK Extension.

and Biologic Development Process

of where they are conducted, all clinical trials included in applications for marketing authorization (“MA”) for human medicines

in the EU/EEA must have been carried out in accordance with EU regulations.

This means that clinical trials conducted in the EU/EEA have

to comply with EU clinical trial legislation but also that clinical trials conducted outside the EU/EEA have to comply with ethical principles

equivalent to those set out in the EEA, including adhering to international good clinical practice and the Declaration of Helsinki.

conduct of clinical trials in the EU is governed by the CTR, which entered into force on January 31, 2022.

The CTR replaced the Clinical

Trials Directive 2001/20/EC, (“Clinical Trials Directive”) and introduced a complete overhaul of the existing regulation

of clinical trials for medicinal products in the EU.

the former regime, which will expire after a transition period of three years as outlined below in more detail, before a clinical trial

can be initiated it must be approved in each EU member state where there is a site at which the clinical trial is to be conducted.

approval must be obtained from two separate entities:

the National Competent Authority (“NCA”) and one or more Ethics Committees.

The NCA of the EU Member States in which the clinical trial will be conducted must authorize the conduct of the trial, and the independent

Ethics Committee must grant a positive opinion in relation to the conduct of the clinical trial in the relevant EU member state before

the commencement of the trial.

Any substantial changes to the trial protocol or other information submitted with the clinical trial applications

must be submitted to or approved by the relevant NCA and Ethics Committees.

Under the current regime all suspected unexpected serious

adverse reactions to the investigated drug that occur during the clinical trial must be reported to the NCA and to the Ethics Committees

of the EU member state where they occur.

more unified procedure will apply under the new CTR.

A sponsor will be able to submit a single application for approval of a clinical

trial through a centralized EU clinical trials portal (the Clinical Trials Information System or “CTIS”).

One national regulatory

authority (the reporting EU member state proposed by the applicant) will take the lead in validating and evaluating the application and

consult and coordinate with the other concerned EU Member States.

If an application is rejected, it may be amended and resubmitted through

the EU clinical trials portal.

If an approval is issued, the sponsor may start the clinical trial in all concerned EU Member States.

However, a concerned EU member state may in limited circumstances declare an “opt-out” from an approval and prevent the clinical

trial from being conducted in such member state.

The CTR also aims to streamline and simplify the rules on safety reporting, and introduces

enhanced transparency requirements such as mandatory submission of a summary of the clinical trial results to the EU Database.

foresees a three-year transition period.

EU Member States will work in CTIS immediately after the system has gone live.

Since January

31, 2023, submission of initial clinical trial applications via CTIS is mandatory and CTIS serves as the single entry point for submission

of clinical trial-related information and data.

By January 31, 2025, all ongoing trials approved under the former Clinical Trials Directive

will need to comply with the CTR and have to be transitioned to CTIS.

On July 19, 2023, the EC published guidance concerning the steps

to be taken in this transition.

This guidance provides, among other things, that (i) documentation which was previously assessed will

not be reassessed, (ii) templates that were developed and endorsed by the EU Clinical Trials Expert Group to provide compliance with

the CTR do not need to be updated and (iii) there is no need to retrospectively create a site suitability form, which are only necessary

for new trial sites.

both the former regime and the new CTR, national laws, regulations, and the applicable GCP and GLP standards must also be respected during

the conduct of the trials, including the International Council for Harmonization of Technical Requirements for Pharmaceuticals for Human

Use guidelines on Good Clinical Practice and the ethical principles that have their origin in the Declaration of Helsinki.

the development of a medicinal product, the EMA and national regulators within the EU provide the opportunity for dialogue and guidance

on the development program.

At the EMA level, this is usually done in the form of scientific advice, which is given by the Committee

for Medicinal Products for Human Use (“CHMP”) on the recommendation of the Scientific Advice Working Party.

A fee is incurred

with each scientific advice procedure, but is significantly reduced for designated orphan medicines.

Advice from the EMA is typically

provided based on questions concerning, for example, quality (chemistry, manufacturing and controls testing), nonclinical testing and

clinical studies, and pharmacovigilance plans and risk-management programs.

Advice is not legally binding with regard to any future Marketing

Authorization Application (“MAA”) of the product concerned.

Marketing Authorization

the EEA, after completion of all required clinical testing, pharmaceutical products may only be placed on the market after obtaining

To obtain a MA of a drug under EU regulatory systems, an applicant can submit an MAA through, amongst others, a centralized or

decentralized procedure.

be used or sold in the UK, a drug must have an effective MA obtained by a centralized application through EMA or a national application.

National applications are governed by the Human Medicines Regulations (SI 2012/1916).

Applications are made electronically through the

Medicines and Healthcare products Regulatory Agency (“MHRA”) Submissions Portal.

The process from application to authorizations

generally takes up to 210 days, excluding time taken to provide any additional information or data required by the MHRA.

August 30, 2023, the MHRA published detailed guidance on its recently announced new International Reliance Procedure (“IRP”)

The IRP applies since January 1, 2024 and replaces existing EU reliance procedures to apply for authorizations from seven international

regulators (e.g.

Health Canada, Swiss Medic, FDA, EMA, among others).

The IRP allows medicinal products approved in other jurisdictions

that meet certain criteria to undergo a fast-tracked MHRA review to obtain and/or update a MA in the UK.

can submit initial MAAs to the IRP but the procedure can also be used throughout the lifecycle of a product for post-authorization procedures

including line extensions, variations and renewals.

Authorization Procedure

centralized procedure provides for the grant of a single MA that is issued by the EC following the scientific assessment of the application

by the EMA that is valid for all EU Member States as well as in the three additional EEA Member States (Norway, Iceland and Liechtenstein).

The centralized procedure is compulsory for specific medicinal products, including for medicines developed by means of certain biotechnological

processes, products designated as orphan medicinal products, advanced therapy medicinal products (“ATMP”) (gene therapy,

somatic cell therapy or tissue engineered medicines) and medicinal products with a new active substance indicated for the treatment of

certain diseases (HIV/AIDS, cancer, neurodegenerative disorders, diabetes, auto-immune and viral diseases).

For medicinal products containing

a new active substance not yet authorized in the EEA before May 20, 2004 and indicated for the treatment of other diseases, medicinal

products that constitute significant therapeutic, scientific or technical innovations or for which the grant of a MA through the centralized

procedure would be in the interest of public health at EU level, an applicant may voluntarily submit an application for a MA through

the centralized procedure.

the centralized procedure, the CHMP established at the EMA, is responsible for conducting the initial assessment of a drug.

is also responsible for several post-authorization and maintenance activities, such as the assessment of modifications or extensions

to an existing MA.

Under the centralized procedure, the timeframe for the evaluation of an MAA by the EMA’s CHMP is, in principle,

210 days from receipt of a valid MAA.

However, this timeline excludes clock stops, when additional written or oral information is to

be provided by the applicant in response to questions asked by the CHMP, so the overall process typically takes a year or more, unless

the application is eligible for an accelerated assessment.

Accelerated evaluation might be granted by the CHMP in exceptional cases,

when a medicinal product is expected to be of a major public health interest, particularly from the point of view of therapeutic innovation.

Upon request, the CHMP can reduce the time frame to 150 days if the applicant provides sufficient justification for an accelerated assessment.

The CHMP will provide a positive opinion regarding the application only if it meets certain quality, safety and efficacy requirements.

This opinion is then transmitted to the EC, which has the ultimate authority for granting MA within 67 days after receipt of the CHMP

Decentralized

Authorization Procedure

that fall outside the mandatory scope of the centralized procedure have three routes to authorization:

(i) they can be authorized under

the centralized procedure if they concern a significant therapeutic, scientific or technical innovation, or if their authorization would

be in the interest of public health;

(ii) they can be authorized under a decentralized procedure where an applicant applies for simultaneous

authorization in more than one EU member state;

or (iii) they can be authorized in an EU member state in accordance with that state’s

national procedures and then be authorized in other EU countries by a procedure whereby the countries concerned agree to recognize the

validity of the original, national MA (mutual recognition procedure).

decentralized procedure permits companies to file identical MA applications for a medicinal product to the competent authorities in various

EU Member States simultaneously if such medicinal product has not received marketing approval in any EU Member State before.

This procedure

is available for pharmaceutical products not falling within the mandatory scope of the centralized procedure.

The competent authority

of a single EU Member State, the reference member state, is appointed to review the application and provide an assessment report.

competent authorities of the other EU Member States, the concerned member states, are subsequently required to grant a MA for their territories

on the basis of this assessment.

The only exception to this is where the competent authority of an EU Member State considers that there

are concerns of potential serious risk to public health, the disputed points are subject to a dispute resolution mechanism and may eventually

be referred to the EC, whose decision is binding for all EU Member States.

Management Plan

new MAAs must include a Risk Management Plan (“RMP”) describing the risk management system that the company will put in place

and documenting measures to prevent or minimize the risks associated with the product.

RMPs are continually modified and updated throughout

the lifetime of the medicine as new information becomes available.

Regarding transfers from

the UK to the EEA, personal data may flow freely since the EEA is deemed to have an adequate data protection level for purposes of the

With regard to the transfer of personal data from the UK to the United States, the UK government has adopted an adequacy decision

for the United States, the UK-US Data Bridge, which came into force on October 12, 2023.

The UK-US Data Bridge recognizes the United States

as offering an adequate level of data protection where the transfer is to a U.S.

company participating in the EU-US Data Privacy Framework

and the UK Extension.

The EU has also recently implemented a number of cybersecurity laws,

some of which are applicable to the healthcare industry.

For example, the Network and Information Security Directive (Directive (EU) 2022/2555)

applies to organizations operating in the EU in the healthcare sector and imposes stringent cybersecurity obligations on in-scope organizations,

including in relation to supply chain management and incident reporting.

Drug and Biologic Development Process

Regardless of where they

are conducted, all clinical trials included in applications for marketing authorization (“MA”) for human medicines in the

EU/EEA must have been carried out in accordance with EU regulations.

This means that clinical trials conducted in the EU/EEA have to comply

with EU clinical trial legislation but also that clinical trials conducted outside the EU/EEA have to comply with ethical principles equivalent

to those set out in the EEA, including adhering to international good clinical practice and the Declaration of Helsinki.

The conduct of

clinical trials in the EU is governed by the CTR, which entered into force on January 31, 2022.

The CTR replaced the Clinical Trials Directive

2001/20/EC (“Clinical Trials Directive”) and introduced a complete overhaul of the existing regulation of clinical trials

for medicinal products in the EU.

The EU Clinical Trials Regulation,

which replaced the Clinical Trials Directive and has been in force since 2022, aims to harmonize and streamline clinical trial processes

across Member States through a centralized application system, the Clinical Trials Information System (CTIS), enabling sponsors to submit

a single application for approval.

One national regulatory authority, designated as the reporting Member State, leads the validation and

evaluation of applications in consultation with other concerned Member States.

Applications may be amended and resubmitted if rejected,

and approved trials may commence in all relevant Member States, although individual states retain the right to “opt out” in

limited circumstances.

The Regulation also simplifies safety reporting rules, introduces enhanced transparency requirements such as mandatory

submission of trial results summaries to the EU Database.

Since January 31, 2023, all initial clinical trial applications must be submitted

through CTIS which now serves as the single entry point for clinical trial-related information and data.

By January 31, 2025, all ongoing

trials approved under the former Clinical Trials Directive must transition to CTIS and comply with the CTR.

On July 19, 2023, the EC published

guidance for this transition, clarifying that previously assessed documentation will not be reassessed, EU-endorsed templates do not require

updates, and site suitability forms are only needed for new trial sites.

Under the CTR, clinical trials must comply with national laws, regulations,

and the applicable GCP and GLP standards, and the International Council for Harmonization of Technical Requirements for Pharmaceuticals

for Human Use (“ICH”) guidelines on Good Clinical Practice, as well as the ethical principles outlined in the Declaration of

During the development of a medicinal product, the EMA and national

regulators within the EU provide the opportunity for dialogue and guidance on the development program.

At the EMA level, this is usually

done in the form of scientific advice, which is given by the Committee for Medicinal Products for Human Use (“CHMP”) on the

recommendation of the Scientific Advice Working Party.

A fee is incurred with each scientific advice procedure, but is significantly reduced

for designated orphan medicines.

Advice from the EMA is typically provided based on questions concerning, for example, quality (chemistry,

manufacturing and controls testing), nonclinical testing and clinical studies, and pharmacovigilance plans and risk-management programs.

Advice is not legally binding with regard to any future Marketing Authorization Application (“MAA”) of the product concerned.

Drug Marketing Authorization

In the EEA, after completion of all required clinical testing, pharmaceutical

products may only be placed on the market after obtaining an MA.

To obtain an MA of a drug under EU regulatory systems, an applicant can

submit an MAA through, amongst others, a centralized or decentralized procedure, as detailed below.

Centralized Authorization Procedure

The centralized procedure provides for the grant of a single MA that

is issued by the EC following the scientific assessment of the application by the EMA that is valid for all EU Member States as well as

in the three additional EEA Member States (Norway, Iceland and Liechtenstein).

The centralized procedure is compulsory for specific medicinal

products, including for medicines developed by means of certain biotechnological processes, products designated as orphan medicinal products,

advanced therapy medicinal products (gene therapy, somatic cell therapy or tissue engineered medicines) and medicinal products with a

new active substance indicated for the treatment of certain diseases (HIV/AIDS, cancer, neurodegenerative disorders, diabetes, auto-immune

and viral diseases).

For medicinal products containing a new active substance for indications that do not fall within the mandatory centralized

procedure, they are eligible for centralized assessment if they constitute significant therapeutic, scientific or technical innovations

or for which the grant of a MA through the centralized procedure would be in the interest of public health at EU level.

Under the centralized procedure,

the Committee for Medicinal Products for Human Use (“CHMP”) established at the EMA is responsible for the initial assessment

The CHMP also oversees the scientific assessment of various post-authorization and maintenance activities, including the assessment

of variations or extensions to an existing MA.

The standard timeframe for the evaluation of an MAA by the EMA’s CHMP is 210 days

from receipt of a valid MAA, excluding clock stops for the applicant to provide additional written or oral information in response to

questions asked by the CHMP.

As a result, the overall process typically takes a year or more, unless the application is eligible for an

accelerated assessment.

Accelerated evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is expected

to be of a major public health interest, particularly from the point of view of therapeutic innovation.

Upon request, the CHMP may reduce

the time frame to 150 days if the applicant provides sufficient justification for an accelerated assessment.

The CHMP will provide a positive

opinion regarding the application only if it meets the required standards for quality, safety and efficacy.

This opinion is then transmitted

to the EC, which has the ultimate authority for granting MA.

Decentralized Authorization Procedure

The decentralized procedure permits companies to file identical MAAs

for a medicinal product not falling within the mandatory centralized procedure to the competent authorities in various EU Member States

simultaneously if such medicinal product has not received marketing approval in any EU Member State.

In this procedure, the reference

member state is appointed to lead the scientific review for the agreement with the competent authorities of the other EU Member States

concerned by the procedure.

A member state may refuse to accept the assessment provided by the reference member state on grounds of a

potential serious risk to public health that is defined as a situation where there is a significant probability that a serious hazard

resulting from a human medicinal product in the context of its proposed use will affect public health.

Risk Management Plan

All new MAAs must include a Risk Management Plan (“RMP”)

describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated

with the product.

RMPs are continually modified and updated throughout the lifetime of the medicine as new information becomes available.

An updated RMP must be submitted:

(i) at the request of EMA or a national

competent authority, or (ii) whenever the risk-management system is modified, especially as the result of new information being received

that may lead to a significant change to the benefit-risk profile or as a result of an important pharmacovigilance or risk-minimization

milestone being reached.

The regulatory authorities may also impose specific obligations as a condition of the MA.

Since October 20,

2023, all RMPs for centrally authorized products are published by the EMA, subject only to limited redactions.

Validity Period

have an initial duration of five years.

After these five years, the authorization may subsequently be renewed on the basis of a reevaluation

of the risk-benefit balance.

Once renewed, the MA is valid for an unlimited period unless the EC or the national competent authority

decides, on justified grounds relating to pharmacovigilance, to proceed with only one additional five-year renewal.

Applications for

renewal must be made to the EMA at least nine months before the five-year period expires.

authorization which is not followed by the actual placing of the drug on the EU market (in case of centralized procedure) or on the market

of the authorizing member state within three years after authorization ceases to be valid.

the UK, the period of three years during which the drug has not been marketed in Great Britain will be restarted from the date of conversion

to a Great Britain MA.

Conversion refers to the procedure by which, as of January 1, 2021, MAs granted on the basis of a centralized

procedure in the EU are only valid in Northern Ireland but not in Great Britain, whereas, prior EU authorizations have all been automatically

converted into UK MAs effective in Great Britain only.

the other hand, for the EU, in the case the drug has been marketed in the UK, the placing on the UK market before the end of the period

starting when the UK left the EU on January 31, 2020 and ending on December 31, 2020 (the “Brexit Transition Period”) will

be taken into account.

If, after the end of the Brexit Transition Period, the drug is not placed on any other market of the remaining

EU Member States, the three-year period will start running from the last date the drug was placed on the UK market before the end of

the Brexit Transition Period.

Therapy Medicinal Products

the EU, medicinal products, including ATMPs are subject to extensive pre- and post-market regulation by regulatory authorities at both

the EU and national levels.

ATMPs comprise gene therapy products, somatic cell therapy products and tissue engineered products, which

are genes, cells or tissues that have undergone substantial manipulation and that are administered to human beings in order to cure,

diagnose or prevent diseases or regenerate, repair or replace a human tissue.

Pursuant to the Regulation (EC) No 1394/2007, the Committee

for Advanced Therapies (“CAT”) is responsible in conjunction with the CHMP for the evaluation of ATMPs.

The CHMP and CAT

are also responsible for providing guidelines on ATMPs.

These guidelines provide additional guidance on the factors that the EMA will

consider in relation to the development and evaluation of ATMPs and include, among other things, the preclinical studies required to

characterize ATMPs.

Although such guidelines are not legally binding, compliance with them is often necessary to gain and maintain approval

for product candidates.

addition to the mandatory RMP, the holder of a MA for an ATMP must put in place and maintain a system to ensure that each individual

product and its starting and raw materials, including all substances coming into contact with the cells or tissues it may contain, can

be traced through the sourcing, manufacturing, packaging, storage, transport and delivery to the relevant healthcare institution where

the product is used.

Circumstances/Conditional Approval

to accelerated approval regulations in the United States, conditional MAs can be granted in the EU in exceptional circumstances.

A conditional

MA can be granted for medicinal products where, although comprehensive clinical data referring to the safety and efficacy of the medicinal

product have not been supplied, a number of criteria are fulfilled:

(i) the benefit/risk balance of the product is positive, (ii) it

is likely that the applicant will be in a position to provide the comprehensive clinical data, (iii) unmet medical needs will be fulfilled

by the grant of the MA and (iv) the benefit to public health of the immediate availability on the market of the medicinal product concerned

outweighs the risk inherent in the fact that additional data are still required.

Once a conditional MA has been granted, the MA holder

must fulfil specific obligations within defined timelines.

A conditional MA is valid for one year and must be renewed annually, but it

can be converted into a standard MA once the MA holder fulfils the obligations imposed and the complete data confirm that the medicine’s

benefits continue to outweigh its risks.

and Market Exclusivity

in the United States, it may be possible to obtain a period of market and / or data exclusivity in the EU that would have the effect

of postponing the entry into the marketplace of a competitor’s generic, hybrid or biosimilar product (even if the pharmaceutical

product has already received a MA) and prohibiting another applicant from relying on the MA holder’s pharmacological, toxicological

and clinical data in support of another MA for the purposes of submitting an application, obtaining MA or placing the product on the

Innovative medicinal products, referred to as New Chemical Entities (“NCEs”) approved in the EU qualify for eight

years of data exclusivity and 10 years of marketing exclusivity.

additional non-cumulative one-year period of marketing exclusivity is possible if during the data exclusivity period (the first eight

years of the 10-year marketing exclusivity period), the MA holder obtains an authorization for one or more new therapeutic indications

that are deemed to bring a significant clinical benefit compared to existing therapies.

data exclusivity period begins on the date of the product’s first MA in the EU.

After eight years, a generic product application

may be submitted and generic companies may rely on the MA holder’s data.

However, a generic product cannot launch until two years

later (or a total of 10 years after the first MA in the EU of the innovator product), or three years later (or a total of 11 years after

the first MA in the EU of the innovator product) if the MA holder obtains MA for a new indication with significant clinical benefit within

the eight-year data exclusivity period.

Additionally, another non-cumulative one-year period of data exclusivity can be added to the

eight years of data exclusivity where an application is made for a new indication for a well-established substance, provided that significant

pre-clinical or clinical studies were carried out in relation to the new indication.

year of data exclusivity may be added to the eight years, where a change of classification of a pharmaceutical product has been authorized

on the basis of significant pre-trial tests or clinical trials (when examining an application by another applicant for or holder of MA

for a change of classification of the same substance the competent authority will not refer to the results of those tests or trials for

one year after the initial change was authorized).

may not be granted data exclusivity since there is no guarantee that a product will be considered by the EU’s regulatory authorities

to include an NCE.

Even if a compound is considered to be an NCE and the MA applicant is able to gain the prescribed period of data exclusivity,

another company nevertheless could also market another version of the medicinal product if such company can complete a full MAA with

their own complete database of pharmaceutical tests, preclinical studies and clinical trials and obtain MA of its product.

April 26, 2023, the EC submitted a proposal for the reform of the European pharmaceutical legislation.

The current draft envisages e.g.,

a shortening of the periods of data exclusivity, however, there is currently neither a final version of this draft nor a date for its

entry into force.

While the European Parliament adopted its approving position on the reform on April 10, 2024, no further required legislative

steps have been taken since.

the EU, companies developing a new medicinal product are obligated to study their product in children and must therefore submit a PIP

together with a request for agreement to the EMA.

The EMA issues a decision on the PIP based on an opinion of the EMA’s Pediatric

Companies must conduct pediatric clinical trials in accordance with the PIP approved by the EMA, unless a deferral (e.g.

enough information to demonstrate its effectiveness and safety in adults is available) or waiver (e.g.

because the relevant disease or

condition occurs only in adults) has been granted by the EMA.

The MAA for the medicinal product must include the results of all pediatric

clinical trials performed and details of all information collected in compliance with the approved PIP, unless a waiver or a deferral

has been granted, in which case the pediatric clinical trials may be completed at a later date.

Medicinal products that are granted an

MA on the basis of the pediatric clinical trials conducted in accordance with the approved PIP are eligible for a six-month extension

of the protection under a supplementary protection certificate (if any is in effect at the time of approval), or, in the case of orphan

medicinal products, a two-year extension of the orphan market exclusivity.

This pediatric reward is subject to specific conditions and

is not automatically available when data in compliance with the approved PIP are developed and submitted.

An approved PIP is also required

when a MA holder wants to add a new indication, medicinal form or route of administration for a medicine that is already authorized and

covered by intellectual property rights.

the UK, the MHRA has published guidance on the procedures for UK Paediatric Investigation Plans (“PIPs”) which, where possible,

mirror the submission format and requirements of the EU system.

EU PIPs remain applicable for Northern Ireland and EU PIPs agreed by

the EMA prior to January 1, 2021 have been adopted as UK PIPs.

Post-Approval

to the United States, both MA holders and manufacturers of medicinal products are subject to comprehensive regulatory oversight by the

EMA, the EC and/or the competent regulatory authorities of the EU Member States.

This oversight applies both before and after grant of

manufacturing licenses and MAs.

It includes control of compliance with EU good manufacturing practices rules, manufacturing authorizations,

pharmacovigilance rules and requirements governing advertising, promotion, sale, and distribution, recordkeeping, importing and exporting

of medicinal products.

by us or by any of our third-party partners, including suppliers, manufacturers and distributors to comply with EU laws and the related

national laws of individual EU Member States governing the conduct of clinical trials, manufacturing approval, MA of medicinal products

and marketing of such products, both before and after grant of MA, statutory health insurance, bribery and anti-corruption or other applicable

regulatory requirements may result in administrative, civil or criminal penalties.

These penalties could include delays or refusal to

authorize the conduct of clinical trials or to grant MA, product withdrawals and recalls, product seizures, suspension, withdrawal or

variation of the MA, total or partial suspension of production, distribution, manufacturing or clinical trials, operating restrictions,

injunctions, suspension of licenses, fines and criminal penalties.

holder of an MA for a medicinal product must also comply with EU pharmacovigilance legislation and its related regulations and guidelines,

which entail many requirements for conducting pharmacovigilance, or the assessment and monitoring of the safety of medicinal products.

pharmacovigilance rules can impose on holders of MAs the obligation to conduct a labor intensive collection of data regarding the risks

and benefits of marketed medicinal products and to engage in ongoing assessments of those risks and benefits, including the possible

requirement to conduct additional clinical studies or post-authorization safety studies to obtain further information on a medicine’s

safety, or to measure the effectiveness of risk-management measures, which may be time consuming and expensive and could impact our profitability.

MA holders must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance, who

is responsible for oversight of that system.

Key obligations include expedited reporting of suspected serious adverse reactions and submission

of Periodic Safety Update Reports (“PSURs”) in relation to medicinal products for which they hold MAs.

The EMA reviews PSURs

for medicinal products authorized through the centralized procedure.

If the EMA has concerns that the risk benefit profile of a product

has varied, it can adopt an opinion advising that the existing MA for the product be suspended, withdrawn or varied.

The agency can advise

that the MA holder be obliged to conduct post-authorization Phase 4 safety studies.

If the EC agrees with the opinion, it can adopt a

decision varying the existing MA.

Failure by the MA holder to fulfill the obligations for which the EC’s decision provides can

undermine the ongoing validity of the MA.

generally, non-compliance with pharmacovigilance obligations can lead to the variation, suspension or withdrawal of the MA for the product

or imposition of financial penalties or other enforcement measures.

manufacturing process for pharmaceutical products in the EU is highly regulated and regulators may shut down manufacturing facilities

that they believe do not comply with regulations.

Manufacturing requires a manufacturing authorization, and the manufacturing authorization

holder must comply with various requirements set out in the applicable EU laws, regulations and guidance, including Directive 2001/83/EC,

Directive 2003/94/EC (repealed by Directive 2017/1572 on January 31, 2022), Regulation (EC) No 726/2004 and the European Commission Guidelines

for Good Manufacturing Practice (“GMP”).

These requirements include compliance with EU GMP standards when manufacturing pharmaceutical

products and active pharmaceutical ingredients, including the manufacture of active pharmaceutical ingredients outside of the EU with

the intention to import the active pharmaceutical ingredients into the EU.

Amendments or replacements of at least Directive 2001/83/EC

and Regulation (EC) No 726/2004 are part of the reform proposal for European pharmaceutical legislation.

Similarly, the distribution

of pharmaceutical products into and within the EU is subject to compliance with the applicable EU laws, regulations and guidelines, including

the requirement to hold appropriate authorizations for distribution granted by the competent authorities of the EU Member States.

manufacturer or importer must have a qualified person who is responsible for certifying that each batch of product has been manufactured

in accordance with GMP, before releasing the product for commercial distribution in the EU or for use in a clinical trial.

(i) at the request of EMA or a national competent authority, or (ii) whenever the risk-management system

is modified, especially as the result of new information being received that may lead to a significant change to the benefit-risk profile

or as a result of an important pharmacovigilance or risk-minimization milestone being reached.

The regulatory authorities may also impose

specific obligations as a condition of the MA.

All RMPs for centrally authorized products are published by the EMA, subject only to limited

MA Validity Period

MAs have an initial duration

of five years.

After these five years, the authorization may subsequently be renewed on the basis of a reevaluation of the risk-benefit

Once renewed, the MA is valid for an unlimited period unless the EC or the national competent authority decides, on justified

grounds relating to pharmacovigilance, to proceed with only one additional five-year renewal.

Applications for renewal must be made to

the EMA at least nine months before the five-year period expires.

Any authorization which is

not followed by the actual placing of the drug on the EU market (in case of centralized procedure) or on the market of the authorizing

member state within three years after authorization ceases to be valid.

The UK applies a rule, consistent

with directly applicable EU law, requiring that nationally approved medicinal products must be placed on the market within three years

from the date the marketing authorization is granted.

When the Medicines and Healthcare products Regulatory Agency (MHRA) becomes aware

that the three-year period is approaching expiry, it will notify the marketing authorization holder in advance that the authorization

will cease to be valid if the product is not marketed within the required timeframe.

The MHRA provides notification to the marketing authorization

holder in both scenarios referenced previously:

first, where a product has held a marketing authorization for three years but has not

been placed on the market at all;

and second, where a product was previously marketed but has subsequently not been placed on the market

for a consecutive period of three years.

This process ensures compliance with regulatory requirements and maintains the integrity of the

national medicines supply.

Following the UK’s exit from the EU, the three-year “sunset clause”

for centrally authorized products in the UK was effectively reset from the date of conversion (January 1, 2021).

This means that any product

not placed on the market in Great Britain by early 2024 risked losing its validity unless the appropriate notification was made.

The Medicines

and Healthcare products Regulatory Agency (MHRA) is responsible for managing this process for UK marketing authorizations (PLGB MAs),

requiring marketing authorization holders to provide updates on the marketing status of their products.

The Windsor Framework agreement

establishes that, effective from January 1, 2025, the Medicines and Healthcare products Regulatory Agency (MHRA) will serve as the sole

regulatory authority for approving medicines for the entire UK market, encompassing both Northern Ireland and Great Britain.

new arrangements, a unified UK-wide authorization process will apply, ensuring that medicines in Northern Ireland are regulated by the

MHRA in the same manner as in Great Britain.

On the other hand, for the

EU, in the case the drug has been marketed in the UK, the placing on the UK market before the end of the period starting when the UK left

the EU on January 31, 2020 and ending on December 31, 2020 (the “Brexit Transition Period”) will be taken into account.

after the end of the Brexit Transition Period, the drug is not placed on any other market of the remaining EU Member States, the three-year

period will start running from the last date the drug was placed on the UK market before the end of the Brexit Transition Period.

Advanced Therapy Medicinal Products

In the EU, medicinal products, including ATMPs are subject to extensive

pre- and post-market regulation by regulatory authorities at both the EU and national levels.

ATMPs comprise gene therapy products, somatic

cell therapy products and tissue engineered products, which are genes, cells or tissues that have undergone substantial manipulation and

that are administered to human beings in order to cure, diagnose or prevent diseases or regenerate, repair or replace a human tissue.

Pursuant to Regulation (EC) No 1394/2007, the Committee for Advanced Therapies (“CAT”) is responsible in conjunction with

the CHMP for the evaluation of ATMPs.

The CHMP and CAT are also responsible for providing guidelines on ATMPs.

These guidelines provide

additional guidance on the factors that the EMA will consider in relation to the development and evaluation of ATMPs and include, among

other things, the preclinical studies required to characterize ATMPs.

Although such guidelines are not legally binding, compliance with

them is often necessary to gain and maintain approval for product candidates.

In addition to the mandatory

RMP, the holder of a MA for an ATMP must put in place and maintain a system to ensure that each individual product and its starting and

raw materials, including all substances coming into contact with the cells or tissues it may contain, can be traced through the sourcing,

manufacturing, packaging, storage, transport and delivery to the relevant healthcare institution where the product is used.

Exceptional Circumstances and Conditional Approval

Similar to accelerated approval

regulations in the United States, conditional MAs can be granted in the EU in exceptional circumstances.

A conditional MA can be granted

for medicinal products where, although comprehensive clinical data referring to the safety and efficacy of the medicinal product have

not been supplied, a number of criteria are fulfilled:

(i) the benefit/risk balance of the product is positive, (ii) it is likely that

the applicant will be in a position to provide the comprehensive clinical data, (iii) unmet medical needs will be fulfilled by the grant

of the MA and (iv) the benefit to public health of the immediate availability on the market of the medicinal product concerned outweighs

the risk inherent in the fact that additional data are still required.

Once a conditional MA has been granted, the MA holder must fulfil

specific obligations within defined timelines.

A conditional MA is valid for one year and must be renewed annually, but it can be converted

into a standard MA once the MA holder fulfils the obligations imposed and the complete data confirm that the medicine’s benefits

continue to outweigh its risks.

Data and Market Exclusivity

Under EU pharmaceutical law, reference medicinal products are granted

8 years of data exclusivity, during which generic and biosimilar manufacturers cannot rely on the originator’s non-clinical and

clinical data for regulatory approval.

This is followed by 2 years of marketing exclusivity, preventing generics and biosimilars from

entering the market for a total of 10 years.

If, within the first 8 years, the reference product is approved for a new indication that

provides significant clinical benefit, the exclusivity period may be extended to 11 years.

These rules ensure that generics and biosimilars

cannot seek approval or enter the market until the exclusivity periods have expired, balancing incentives for innovation with future market

A reference medicinal product

for data and marketing exclusivity typically contains a new active substance and requires a full dossier, including pharmaceutical, non-clinical,

and clinical trial data, for approval.

The European Medicines Agency (EMA), based on the scientific assessment and opinion of its Committee

for Medicinal Products for Human Use (CHMP), determines whether a product contains a new active substance.

Data and marketing exclusivity

do not prevent other companies from generating their own data through independent development to demonstrate the safety, quality, and

efficacy of their own products.

Recent reforms introduced

through the EU Pharma Package and the proposed Biotech Act bring significant changes, including streamlined authorization procedures,

enhanced measures for access and affordability, stricter management of medicine shortages, strengthened post-market surveillance, and

new requirements addressing environmental and ethical considerations.

These initiatives are designed to modernize and harmonize medicines

regulation, facilitate patient access to innovative therapies, and provide robust oversight of emerging technologies across the EU.

The legislative process for the EU Pharma Package began with the European

Commission’s proposal in April 2023, followed by the development of positions by the European Parliament and the Council.

This culminated

in Trilogue negotiations, with a political agreement reached in December 2025.

The agreed text now awaits formal adoption by both the

Parliament and Council, after which it will be published in the Official Journal of the EU.

The new Directive and Regulation will then

enter into force following a transition period of 18 to 36 months, ultimately modernizing EU pharmaceutical law to better support innovation,

access, and supply.

Under the agreed EU Pharma Package, companies launching new medicines will benefit from eight years of data protection

and one year of market exclusivity, with a possible additional year for innovative products meeting specific criteria.

Pediatric Development

In the EU, companies developing

a new medicinal product are obligated to study their product in children and must therefore submit a PIP together with a request for agreement

The EMA issues a decision on the PIP based on an opinion of the EMA’s Pediatric Committee.

Companies must conduct pediatric

clinical trials in accordance with the PIP approved by the EMA, unless a deferral (e.g.

until enough information to demonstrate its effectiveness

and safety in adults is available) or waiver (e.g.

because the relevant disease or condition occurs only in adults) has been granted by

The MAA for the medicinal product must include the results of all pediatric clinical trials performed and details of all information

collected in compliance with the approved PIP, unless a waiver or a deferral has been granted, in which case the pediatric clinical trials

may be completed at a later date.

Medicinal products that are granted an MA on the basis of the pediatric clinical trials conducted in

accordance with the approved PIP are eligible for a six-month extension of the protection under a supplementary protection certificate

(if any is in effect at the time of approval), or, in the case of orphan medicinal products, a two-year extension of the orphan market

This pediatric reward is subject to specific conditions and is not automatically available when data in compliance with the

approved PIP are developed and submitted.

An approved PIP is also required when a MA holder wants to add a new indication, medicinal form

or route of administration for a medicine that is already authorized and covered by intellectual property rights.

In the UK, the MHRA has established a closely aligned process, frequently

accepting agreed EU PIPs and decisions to streamline UK submissions.

However, the MHRA maintains UK-specific requirements, such as the

need for a UK PIP for new medicines.

Post-Approval Regulation

Similar to the United States,

both MA holders and manufacturers of medicinal products in the EU are subject to comprehensive regulatory oversight by the EMA, the EC

and/or the competent regulatory authorities of the EU Member States.

The regulatory oversight covers every stage of the authorization

process, from initial grant of an approval to ongoing monitoring of compliance with EU cGMPs, manufacturing authorizations, pharmacovigilance

rules and requirements governing advertising, promotion, sale, and distribution, recordkeeping, importing, and exporting of medicinal

These regulatory requirements

are designed to ensure that the safety, quality, and efficacy standards of medicinal products are consistently maintained throughout their

Failure by us or by any of our third-party partners, including suppliers, manufacturers and distributors to comply with EU

laws and the related national laws of individual EU Member States governing the conduct of clinical trials, manufacturing approval, MA

of medicinal products and marketing of such products, both before and after grant of MA, statutory health insurance, bribery and anti-corruption

or other applicable regulatory requirements may result in administrative, civil or criminal sanctions.

These include delays or refusal

to authorize the conduct of clinical trials or to grant MA, product withdrawals and recalls, product seizures, withdrawal or suspension

of authorizations, restrictions on regulated activities such as production, distribution, manufacturing or clinical trials, operating

restrictions, and financial penalties.

The holder of an MA for a

medicinal product must also comply with EU pharmacovigilance legislation and its related regulations and guidelines, which entail many

requirements for conducting pharmacovigilance, or the assessment and monitoring of the safety of medicinal products.

These pharmacovigilance rules

require holders of MAs the obligation to develop a system capable of collecting, collating, assessing, and reporting post-authorization

data to monitor the ongoing risks and benefits of marketed medicinal products, as well as the requirement to conduct additional clinical

studies or post-authorization safety or efficacy studies to address uncertainties about the risk-benefit balance, or to measure the effectiveness

of risk-management measures.

Such post-authorization measures may be time-consuming and expensive and could impact our profitability.

MA holders must establish and maintain a pharmacovigilance system designed to monitor the safety of authorized medicinal products and

detect any change to their risk-benefit balance and appoint an individual qualified person for pharmacovigilance, who is responsible for

the oversight of that system.

Key obligations include expedited reporting of unexpected serious adverse reactions and submission of Periodic

Safety Update Reports (“PSURs”) in relation to medicinal products for which they hold MAs.

The EMA reviews PSURs for medicinal

products authorized through the centralized procedure.

If the EMA, based on the scientific assessment conducted by its advisory committees,

determines that the risk-benefit profile of a product has changed, it may issue an opinion recommending suspension, withdrawal, or variation

of the existing MA.

The scientific opinion must be ratified by the EC in a legally binding decision.

If the MA holder fails to meet the

obligations set out in the EC’s decision, the validity of the MA may be compromised.

For centrally authorized products, non-compliance

with pharmacovigilance requirements can result in regulatory sanctions, including financial penalties imposed by the EC.

More generally, non-compliance with pharmacovigilance obligations can

lead to the variation, suspension or withdrawal of the MA for the product or imposition of financial penalties or other enforcement measures.

The manufacturing process for pharmaceutical products in the EU is

highly regulated and regulators may shut down manufacturing facilities that they believe do not comply with regulations.

Manufacturing

requires a manufacturing authorization, and the manufacturing authorization holder must comply with various requirements set out in the

applicable EU laws, regulations and guidance, including Directive 2001/83/EC, Directive 2003/94/EC (repealed by Directive 2017/1572 on

January 31, 2022), Regulation (EC) No 726/2004 and the European Commission Guidelines for Good Manufacturing Practice (“GMP”).

These requirements include compliance with EU cGMP standards when manufacturing pharmaceutical products and active pharmaceutical ingredients,

including the manufacture of active pharmaceutical ingredients outside of the EU with the intention to import the active pharmaceutical

ingredients into the EU.

Amendments or replacements of at least Directive 2001/83/EC and Regulation (EC) No 726/2004 are part of the reform

proposal for European pharmaceutical legislation.

Similarly, the distribution of pharmaceutical products into and within the EU is subject

to compliance with the applicable EU laws, regulations and guidelines, including the requirement to hold appropriate authorizations for

distribution granted by the competent authorities of the EU Member States.

The manufacturer or importer must have a qualified person who

is responsible for certifying that each batch of product has been manufactured in accordance with GMP and the terms of a marketing authorization

or clinical trial authorization, before releasing the product for commercial distribution in the EU or for use in a clinical trial.

Manufacturing

facilities are subject to periodic inspections by the competent authorities for compliance with GMP.

and Marketing Regulations

advertising and promotion of our products is also subject to EU laws concerning promotion of medicinal products, interactions with physicians,

misleading and comparative advertising and unfair commercial practices.

In addition, other national legislation of individual EU Member

States may apply to the advertising and promotion of medicinal products and may differ from one country to another.

These laws require

that promotional materials and advertising in relation to medicinal products comply with the product’s SmPC as approved by the

competent regulatory authorities.

The SmPC is the document that provides information to physicians concerning the safe and effective

use of the medicinal product.

It forms an intrinsic and integral part of the MA granted for the medicinal product.

Promotion of a medicinal

product that does not comply with the SmPC is considered to constitute off-label promotion.

All advertising and promotional activities

for the product must be consistent with the approved SmPC and therefore all off-label promotion is prohibited.

Direct-to-consumer advertising

of prescription-only medicines is also prohibited in the EU.

Violations of the rules governing the promotion of medicinal products in

the EU could be penalized by administrative measures, fines and imprisonment.

These laws may further limit or restrict the advertising

and promotion of our products to the general public and may also impose limitations on its promotional activities with healthcare professionals.

regulation with regards to dispensing, sale and purchase of medicines has generally been preserved in the UK following Brexit, through

the Human Medicines Regulations 2012.

Advertising and Promotion Regulations

The advertising and promotion

of our products is also subject to EU laws concerning promotion of medicinal products, interactions with physicians, misleading and comparative

advertising and unfair commercial practices.

In addition, other national legislation of individual EU Member States may apply to the advertising

and promotion of medicinal products and may differ from one country to another.

These laws require that promotional materials and advertising

in relation to medicinal products comply with the product’s SmPC as approved by the competent regulatory authorities.

the document that provides information to physicians concerning the safe and effective use of the medicinal product.

It forms an intrinsic

and integral part of the MA granted for the medicinal product.

Promotion of a medicinal product that does not comply with the SmPC is

considered to constitute off-label promotion.

All advertising and promotional activities for the product must be consistent with the approved

SmPC and therefore all off-label promotion is prohibited.

Direct-to-consumer advertising of prescription-only medicines is also prohibited

Violations of the rules governing the promotion of medicinal products in the EU could be penalized by administrative measures,

fines and imprisonment.

These laws may further limit or restrict the advertising and promotion of our products to the general public and

may also impose limitations on its promotional activities with healthcare professionals.

EU regulation with regards

to dispensing, sale and purchase of medicines has generally been preserved in the UK following Brexit, through the Human Medicines Regulations

However, organizations wishing to sell medicines online need to register with the MHRA.

Brexit, the requirements to display the common logo no longer apply to UK-based online sellers, except for those established in Northern

Anti-Corruption

the EU, interactions between pharmaceutical companies and physicians are also governed by strict laws, regulations, industry self-regulation

codes of conduct and physicians’ codes of professional conduct both at EU level and in the individual EU Member States.

The provision

of benefits or advantages to physicians to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order

or use of medicinal products is prohibited in the EU.

The provision of benefits or advantages to physicians is also governed by the national

anti-bribery laws of the EU Member States.

Following Brexit, the requirements to display

the common logo no longer apply to UK-based online sellers, except for those established in Northern Ireland.

Anti-Corruption Legislation

In the EU, interactions between

pharmaceutical companies and physicians are also governed by strict laws, regulations, industry self-regulation codes of conduct and physicians’

codes of professional conduct both at EU level and in the individual EU Member States.

The provision of benefits or advantages to physicians

to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order or use of medicinal products is prohibited

The provision of benefits or advantages to physicians is also governed by the national anti-bribery laws of the EU Member States.

Violation of these laws could result in substantial fines and imprisonment.

made to physicians in certain EU Member States also must be publicly disclosed.

Moreover, agreements with physicians must often be the

subject of prior notification and approval by the physician’s employer, his/her regulatory professional organization, and/or the

competent authorities of the individual EU Member States.

These requirements are provided in the national laws, industry codes, or professional

codes of conduct, applicable in the individual EU Member States.

Failure to comply with these requirements could result in reputational

risk, public reprimands, administrative penalties, fines or imprisonment.

the UK, the pharmaceutical sector is recognized as being particularly vulnerable to corrupt practices, some of which fall within the

scope of the Bribery Act 2010.

Due to the Bribery Act 2010’s far-reaching territorial application, the potential penalized act

does not have to occur in the UK to become within its scope.

If the act or omission does not take place in the UK, but the person’s

act or omission would constitute an offense if carried out there and the person has a close connection with the UK, an offense will still

have been committed.

Bribery Act 2010 is comprised of four offenses that cover (i) individuals, companies and partnerships that give, promise or offer bribes,

(ii) individuals, companies and partnerships that request, agree to receive or accept bribes, (iii) individuals, companies and partnerships

that bribe foreign public officials, and (iv) companies and partnerships that fail to prevent persons acting on their behalf from paying

The penalties imposed under the Bribery Act 2010 depend on the offence committed, harm and culpability and penalties range from

unlimited fines to imprisonment for a maximum term of ten years and in some cases both.

in the UK and Other Markets

UK formally left the EU on January 31, 2020 and EU laws now only apply to the UK in respect of Northern Ireland as laid out in the Protocol

on Ireland and Northern Ireland and as amended by the Windsor Framework sets out a long-term set of arrangements for the supply of medicines

into Northern Ireland.

The EU and the UK agreed on a trade and cooperation agreement (“TCA”), which includes provisions affecting

the life sciences sector (including on customs and tariffs).

There are some specific provisions concerning pharmaceuticals, including

the mutual recognition of GMP, inspections of manufacturing facilities for medicinal products and GMP issued documents.

not, however, contain wholesale mutual recognition of UK and EU pharmaceutical regulations and product standards.

UK government has adopted the Medicines and Medical Devices Act 2021 (the “MMDA”) to enable the UK’s regulatory frameworks

to be updated following the UK’s departure from the EU.

The MMDA introduces regulation-making, delegated powers covering the fields

of human medicines, clinical trials of human medicines, veterinary medicines and medical devices.

The MHRA has since been consulting

on future regulations for medicines and medical devices in the UK.

other countries outside of the EU, such as countries in Eastern Europe, Latin America or Asia, the requirements governing the conduct

of clinical trials, product licensing, pricing and reimbursement vary from country to country.

In all cases, again, the clinical trials

must be conducted in accordance with GCP and the applicable regulatory requirements and the ethical principles that have their origin

in the Declaration of Helsinki.

we fail to comply with applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension of clinical

trials, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

were formed as a Delaware corporation in 1992 under the name “Nuvelo, Inc.” and subsequently, in 2009, we completed a business

combination with ARCA biopharma, Inc.

On August 29, 2024, we completed the Merger with Pre-Merger Oruka and changed our name from “ARCA

biopharma, Inc.” to “Oruka Therapeutics, Inc.” Our corporate headquarters are located at 855 Oak Grove Avenue, Suite

100, Menlo Park, California 94025.

Payments made to physicians

in certain EU Member States also must be publicly disclosed.

Moreover, agreements with physicians must often be the subject of prior notification

and approval by the physician’s employer, his/her regulatory professional organization, and/or the competent authorities of the

individual EU Member States.

These requirements are provided in the national laws, industry codes, or professional codes of conduct, applicable

in the individual EU Member States.

Failure to comply with these requirements could result in reputational risk, public reprimands, administrative

penalties, fines or imprisonment.

In the UK, the pharmaceutical

sector is recognized as being particularly vulnerable to corrupt practices, some of which fall within the scope of the Bribery Act 2010.

Due to the Bribery Act 2010’s far-reaching territorial application, the potential penalized act does not have to occur in the UK

to become within its scope.

If the act or omission does not take place in the UK, but the person’s act or omission would constitute

an offense if carried out there and the person has a close connection with the UK, an offense will still have been committed.

The Bribery Act 2010 is comprised

of four offenses that cover (i) individuals, companies and partnerships that give, promise or offer bribes, (ii) individuals, companies

and partnerships that request, agree to receive or accept bribes, (iii) individuals, companies and partnerships that bribe foreign public

officials, and (iv) companies and partnerships that fail to prevent persons acting on their behalf from paying bribes.

The penalties imposed

under the Bribery Act 2010 depend on the offence committed, harm and culpability and penalties range from unlimited fines to imprisonment

for a maximum term of ten years and in some cases both.

Regulations in the UK and Other Markets

The UK formally left the

EU on January 31, 2020 and EU laws now only apply to the UK in respect of Northern Ireland as laid out in the Protocol on Ireland and

Northern Ireland and as amended by the Windsor Framework sets out a long-term set of arrangements for the supply of medicines into Northern

The EU and the UK agreed on a trade and cooperation agreement (“TCA”), which includes provisions affecting the life

sciences sector (including on customs and tariffs).

There are some specific provisions concerning pharmaceuticals, including the mutual

recognition of GMP, inspections of manufacturing facilities for medicinal products and GMP issued documents.

The TCA does not, however,

contain wholesale mutual recognition of UK and EU pharmaceutical regulations and product standards.

The UK government has adopted

the Medicines and Medical Devices Act 2021 (the “MMDA”) to enable the UK’s regulatory frameworks to be updated following

the UK’s departure from the EU.

The MMDA introduces regulation-making, delegated powers covering the fields of human medicines,

clinical trials of human medicines, veterinary medicines and medical devices.

The MHRA has since been consulting on future regulations

for medicines and medical devices in the UK.

For other countries outside of the EU, such as countries in Eastern

Europe, Latin America or Asia, the requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement

vary from country to country.

In all cases, again, the clinical trials must be conducted in accordance with GCPs and the applicable regulatory

requirements and the ethical principles that have their origin in the Declaration of Helsinki.

If we fail to comply with

applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension of clinical trials, suspension

or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

Corporate Information

We were formed as a Delaware

corporation in 1992 under the name “Nuvelo, Inc.” and subsequently, in 2009, we completed a business combination with ARCA

biopharma, Inc.

On August 29, 2024, we completed the Merger with Pre-Merger Oruka and changed our name from “ARCA biopharma, Inc.”

to “Oruka Therapeutics, Inc.” Our corporate headquarters are located at 855 Oak Grove Avenue, Suite 100, Menlo Park, California

The telephone number at our corporate headquarters is (650) 606-7910.

Our corporate website address

is www.orukatx.com .

We do not incorporate information contained on, or accessible through, our website into this Annual Report

on Form 10-K, and you should not consider it part of this Annual Report.

and Human Capital Resources

of December 31, 2024 and as of February 28, 2025, we had 28 full-time employees and 36 full-time employees, respectively.

We also engage

temporary employees and consultants to augment our existing workforce.

None of our employees are represented by a labor union or covered

under a collective bargaining agreement.

We consider our relationship with our employees to be good.

recognize that attracting, motivating, and retaining talent at all levels is vital to continuing our success.

We invest in our employees

through high-quality benefits, professional development opportunities, and various health and wellness initiatives and offer competitive

compensation packages (base salary and incentive plans), ensuring fairness in internal compensation practices.

The principal purposes

of our incentive plans (bonus and equity) are to align with the long-term interests of our stakeholders and stockholders.

Our corporate website address is www.orukatx.com .

We do not incorporate information contained on, or accessible through, our website into this Annual Report on Form 10-K, and you should

not consider it part of this Annual Report.

Employees and Human Capital Resources

As of December 31, 2025

we had 68 full-time employees of which 51 employees were in research and development and the remaining 17 employees worked in

finance, legal, business development, human resources, and administrative support.

All our full-time employees are located in the

United States.

We also engage temporary employees and consultants to augment our existing workforce.

None of our employees are

represented by a labor union or covered under a collective bargaining agreement.

We consider our relationship with our employees to

We recognize that attracting,

motivating, and retaining talent at all levels is vital to continuing our success.

We invest in our employees through high-quality benefits,

professional development opportunities, and various health and wellness initiatives and offer competitive compensation packages (base

salary and incentive plans), ensuring fairness in internal compensation practices.

The principal purposes of our incentive plans (bonus

and equity) are to align with the long-term interests of our stakeholders and stockholders.

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

What changed 10-K

Item 1. Business