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Item 1A. Risk Factors

2023-03-09 compared with 2022-03-01 · 275 added, 234 removed, 1122 unchanged (31% of the section changed)

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We have incurred significant net losses since inception and we expect to continue to incur significant net losses for the foreseeable future.

We have incurred significant net losses since our inception and have financed our operations principally through equity financing and our collaboration with Novartis.

We have incurred significant net losses since our inception and have financed our operations principally through equity and debt financing and our collaboration with Novartis.

We continue to incur significant research and development and other expenses related to our ongoing operations.

Our net loss was $97.3 million $41.5 million and $631,000 for the years ended December 31, 2021, 2020 and 2019, respectively.

Our net loss was $123.3 million $97.3 million and

$41.5 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2022, we had an accumulated deficit of $338.4 million.

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We expect to continue to incur significant losses for the foreseeable future, and we anticipate that our expenses will increase substantially if, and as, we:

• advance our lead product candidate, PLN-74809, and our other product candidates through clinical development, and, if successful, later-stage clinical trials;

• advance our lead product candidate, bexotegrast, and our other product candidates through clinical development, and, if successful, later-stage clinical trials;

• discover and develop new product candidates;

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• seek regulatory approvals for any product candidates that successfully complete clinical trials;

• commercialize PLN-74809, our other product candidates and any future product candidates, if approved;

• commercialize bexotegrast, our other product candidates and any future product candidates, if approved;

• increase the amount of research and development activities to identify and develop product candidates;

• hire additional clinical development, quality control, scientific and management personnel;

• expand our operational, financial and management systems and increase personnel, including personnel to support our clinical development and manufacturing efforts and our operations as a public company;

• expand our operational, financial and management systems and increase personnel, including personnel to support our clinical development and manufacturing efforts;

• establish a sales, marketing, medical affairs and distribution infrastructure to commercialize any products for which we may obtain marketing approval and intend to commercialize on our own or jointly with third parties;

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Our failure to become and remain profitable would decrease the value of our company and could impair our ability to raise capital, maintain our research and development efforts, expand our business, or continue our operations.

We will require substantial additional capital to finance our operations.

We will require substantial additional capital to fund our operations.

If we are unable to raise such capital when needed, or on acceptable terms, we may be forced to delay, reduce and/or eliminate one or more of our research and drug development programs, future commercialization efforts or other operations.

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Our operations have consumed substantial amounts of cash since inception.

We expect our expenses to increase in connection with our ongoing activities, particularly as we conduct our planned clinical trials of PLN-74809 and any future product candidates that we may develop, seek regulatory approvals for our product candidates and to launch and commercialize any products for which we receive regulatory approval.

We also expect to incur additional costs associated with operating as a public company.

Accordingly, we will need to obtain substantial additional funding in order to maintain our continuing operations.

We expect our expenses to increase in connection with our ongoing activities, particularly as we conduct our planned clinical trials of bexotegrast and any future product candidates that we may develop, seek regulatory approvals for our product candidates and to launch and commercialize any products for which we receive regulatory approval.

Accordingly, we will need to obtain substantial additional funding in order to maintain our continuing

If we are unable to raise capital when needed or on acceptable terms, we may be forced to delay, reduce, or eliminate one or more of our research and drug development programs or future commercialization efforts.

As of December 31, 2022, we had approximately $331.2 million in cash, cash equivalents and short-term investments.

Based on our current operating plan, we believe that our existing cash, cash equivalents and short-term investments, will be sufficient to fund our operating expenses and capital expenditure requirements into the second half of 2023.

We believe that our existing capital resources, together with the proceeds from our July 2022 and January 2023 public offerings will be sufficient to meet our projected operating requirements into the second half of 2026.

However, our future capital requirements and the period for which our existing resources will support our operations may vary significantly from what we expect, and we will in any event require additional capital in order to complete clinical development of any of our current programs.

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• the clinical development plans we establish for these product candidates;

• the timelines of our clinical trials and the overall costs to conduct and complete the clinical trials due to the COVID-19 pandemic;

• the timelines of our clinical trials and the overall costs to conduct and complete the clinical trials, including any increased costs due to disruptions caused by the ongoing COVID-19 pandemic or other geopolitical conditions;

• the cost and capital commitments required for developing manufacturing processes for our product candidates and manufacturing our product candidates at clinical and commercial scales;

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• whether we are able to maintain our existing collaboration with Novartis and enter into additional collaboration agreements and the terms of any such agreements;

• the ability to and timing of achieving a favorable pricing and reimbursement decision by the pricing authorities in the markets of interest;

• the ability to secure a position recommendation following the health technology assessment by the health technology bodies in the relevant market;

• the cost of filing, prosecuting, defending and enforcing our patent claims and other intellectual property rights;

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• the cost of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval in regions where we choose to commercialize our products on our own.

We do not have any committed external source of funds or other support for our development efforts and we cannot be certain that additional funding will be available on acceptable terms, or at all.

We have borrowed and in the future may borrow additional capital from institutional and commercial banking sources to fund future growth, including pursuant to our Oxford Loan Agreement, or potentially pursuant to new arrangements with different lenders.

In addition, we expect to continue to opportunistically seek access to the equity capital markets to support our development efforts and operations.

However, we cannot be certain that additional funding will be available on acceptable terms, or at all.

Until we can generate sufficient revenue to finance our cash requirements, which we may never do, we expect to finance our future cash needs through a combination of public or private equity offerings, debt financings, collaborations, strategic alliances, licensing arrangements and other marketing or distribution arrangements.

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Further, to the extent that we raise additional capital through the sale of common stock or securities convertible or exchangeable into common stock, your ownership interest will be diluted.

In addition, any debt financing may subject us to fixed payment obligations and covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, or declaring dividends.

expenditures, or declaring dividends.

If we raise additional capital through marketing and distribution arrangements or other collaborations, strategic alliances, or licensing arrangements with third parties, we may have to relinquish certain valuable intellectual property or other rights to our product candidates, technologies, future revenue streams or research programs or grant licenses on terms that may not be favorable to us.

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Any of the above events could significantly harm our business, prospects, financial condition and results of operations and cause the price of our common stock to decline.

Covenants and other provisions in the Oxford Loan Agreement restrict our business and operations in many ways, and if we do not effectively manage our covenants, our financial conditions and results of operations could be adversely affected.

In addition, our operations may not provide sufficient cash to meet the repayment obligations of our debt incurred under the Oxford Loan Agreement.

Pursuant to the Oxford Loan Agreement, Oxford has been granted a security interest in substantially all of our assets, excluding intellectual property (but including the right to payments and proceeds of intellectual property), and a negative pledge on substantially all of our intellectual property, subject to customary exceptions.

If an event of default occurs under the Oxford Loan Agreement, Oxford may foreclose on its security interest and liquidate some or all of these assets, which would harm our business, financial condition and results of operations.

In the event of a default in connection with our bankruptcy, insolvency, liquidation, or reorganization, Oxford would have a prior right to substantially all of our assets to the exclusion of our general unsecured creditors.

Only after satisfying the claims of Oxford and any unsecured creditors would any amount be available for our equity holders.

The pledge of these assets and other restrictions imposed in the Oxford Loan Agreement may limit our flexibility in raising capital for other purposes.

Because substantially all of our assets are pledged to secure the Oxford Loan Agreement obligations, our ability to incur additional indebtedness or to sell or dispose of assets to raise capital may be impaired, which could have an adverse effect on our financial flexibility.

In addition, if we are unable to comply with certain financial and operating restrictions in the Oxford Loan Agreement, we may be limited in our business activities and access to credit or may default under the Oxford Loan Agreement.

Provisions in the Oxford Loan Agreement impose restrictions or require prior approval on our ability, and the ability of certain of our subsidiaries to, among other things:

• Incur additional debt;

• Make certain investments and acquisitions;

• Guarantee the indebtedness of others or our subsidiaries;

• Create liens or encumbrances;

• Engage in new lines of business;

• Enter into transactions with affiliates;

• Pay cash dividends and make distributions;

• Redeem or repurchase capital shares;

• Sell, lease or transfer certain parts of our business or property, including equity interests of our subsidiaries;

• Prepay other indebtedness;

• Acquire new companies and merge or consolidate.

The Oxford Loan Agreement also contains other customary covenants.

We may not be able to comply with these covenants in the future.

Our failure to comply with these covenants may result in the declaration of an event of default, which, if not cured or waived, may result in the acceleration of the maturity of indebtedness outstanding under the Oxford Loan Agreement and would require us to pay all amounts outstanding.

If the maturity of our indebtedness is accelerated, we may not have sufficient funds then available for repayment or we may not have the ability to borrow or obtain sufficient funds to replace the accelerated indebtedness on terms acceptable to us or at all.

Our failure to repay our obligations under the Oxford Loan Agreement would result in Oxford foreclosing on all or a portion of our assets, which could force us to curtail or cease our operations.

The amount of our future losses is uncertain and our quarterly operating results may fluctuate significantly or may fall below the expectations of investors or securities analysts, each of which may cause our stock price to fluctuate or decline.

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• the changing and volatile U.S.

and global economic environments;

and global economic and political environments;

• future accounting pronouncements or changes in our accounting policies.

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We have a limited operating history, which may make it difficult to evaluate our prospects and likelihood of success.

We are a clinical-stage biopharmaceutical company with a limited operating history.

We were incorporated in 2015, have no products approved for commercial sale and have not generated any revenue from product sales to date.

We have no products approved for commercial sale and have not generated any revenue from product sales to date.

Our operations to date have been limited to organizing and staffing our company, business planning, raising capital, establishing our intellectual property portfolio and performing research and development of our product candidates and our technology related to transforming growth factor beta, or TGF-β, signaling and integrin biology, medicinal chemistry, translational screening technologies, and clinical insights to discover and develop novel therapies for the treatment of fibrosis.

Our approach to the discovery and development of product candidates is unproven, and we do not know whether we will be able to develop any products of commercial value.

In addition, our lead product candidate, PLN-74809, is in early clinical development for the treatment of IPF and PSC, and a second product candidate, PLN-1474, is in early clinical development.

Both programs will require substantial additional development and clinical research time and resources, either from us or our collaborators, before we would be able to apply for or receive regulatory approvals and begin generating revenue from product sales.

We have not yet demonstrated the ability to progress any product candidate through clinical trials.

We are still in preclinical and early clinical development and may be unable to obtain regulatory approval, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization.

Investment in biopharmaceutical product development is highly speculative because it entails substantial upfront capital expenditures and significant risk that any potential product candidate will fail to demonstrate adequate efficacy or an acceptable safety profile, gain regulatory approval and become commercially viable.

We have not yet demonstrated the ability to progress any product candidate through clinical trials, obtain regulatory approval, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization.

In addition, as a business with a limited operating history, we may encounter unforeseen expenses, difficulties, complications, delays and other known and unknown factors and risks frequently experienced by early-stage biopharmaceutical companies in rapidly evolving fields.

Consequently, we have no meaningful history of operations upon which to evaluate our business, and predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history or a history of successfully developing and commercializing drug products.

Our business is highly dependent on the success of our lead product candidate, PLN-74809, as well as PLN-1474 and any other product candidates that we advance into the clinic.

All of our product candidates will require significant additional preclinical and clinical development before we may be able to seek regulatory approval for and launch a product commercially.

Consequently, we expect our operating results to continue to fluctuate significantly from quarter to quarter and year to year due to a variety of factors, many of which are

beyond our control, and predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history or a history of successfully developing and commercializing drug products.

Our business is highly dependent on the success of our lead product candidate, bexotegrast, as well as PLN-1474 and any other product candidates that we advance into the clinic.

Our product candidates will require significant additional development before we may be able to seek regulatory approval for and launch a product commercially.

We currently have no products that are approved for commercial sale and may never be able to develop marketable products.

We are very early in our clinical development for both PLN-74809 and PLN-1474.

Because PLN-74809 is our lead product candidate, if PLN-74809 encounters safety or efficacy problems, development delays, regulatory issues or other problems, our development plans and business would be significantly harmed.

We have completed various Phase 1 trials of PLN-74809.

We are enrolling two Phase 2a trials in IPF, including a PET imaging trial.

We are also conducting a Phase 2a PSC trial which is currently enrolling patients.

We are also collaborating with Novartis to develop PLN-1474 for liver fibrosis associated with NASH and have completed a Phase 1a SAD/MAD study evaluating PLN-1474 in healthy volunteers.

The IND for this candidate was transferred to Novartis in the first quarter of 2021, and Novartis is responsible for all PLN-1474 development, manufacturing, and commercialization activities after the initial development period.

All of the risks and uncertainties that apply to PLN-74809 or any candidates that we develop independently apply equally to our collaborator with respect to advancement of PLN-1474.

In addition, we also face risks resulting from our reliance on Novartis for development of this candidate.

We are early in our clinical development for both bexotegrast and PLN-1474.

If bexotegrast encounters safety or efficacy problems, development delays, regulatory issues or other problems, our development plans and business would be significantly harmed.

We have completed several Phase 1 trials of bexotegrast and are currently conducting three Phase 2a trials in our lead indications:

two in IPF and one in PSC.

We have collaborated with Novartis to develop PLN-1474 for advanced liver fibrosis associated with NASH and have completed a Phase 1a SAD/MAD study evaluating PLN-1474 in healthy volunteers.

As part of a broad strategic realignment, Novartis discontinued clinical development in NASH and, as a result, discontinued development of PLN-1474.

In February 2023, Novartis issued a termination notice for the collaboration and license agreement, and returned global rights to Pliant for PLN-1474 and we may pursue other collaborations to further clinical development of PLN-1474.

All of the risks and uncertainties that apply to bexotegrast or any candidates that we develop independently or in collaboration with third parties.

See “Risks Related to Our Reliance on Third Parties.”

Before we can generate any revenue from sales of our lead product candidate, PLN-74809, or any of our other product candidates, we must undergo additional preclinical and clinical development, regulatory review, and approval in one or more jurisdictions.

Before we can generate any revenue from sales of our lead product candidate, bexotegrast, or any of our other product candidates, we must undergo additional preclinical and clinical development, regulatory review, and approval in one or more jurisdictions.

In addition, if one or more of our product candidates are approved, we must ensure access to sufficient commercial manufacturing capacity and conduct significant marketing efforts in connection with any commercial launch.

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Targeting integrins to treat fibrosis is a novel approach in a rapidly developing field, and there can be no assurance that we will not experience currently unknown problems or delays in developing our product candidates, that such problems or delays will not result in unanticipated costs, or that any such development problems can be solved.

We have primarily tested our lead product candidate, PLN-74809, in healthy volunteers.

We have primarily tested our lead product candidate, bexotegrast, in healthy volunteers.

Therefore, we may ultimately discover that our approach and any product candidates resulting therefrom do not possess properties required for therapeutic effectiveness.

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A number of companies in the biopharmaceutical industry have suffered significant setbacks in advanced clinical trials due to lack of efficacy or unacceptable safety issues, notwithstanding promising results in earlier trials.

Most product candidates that commence clinical trials are never approved as products and there can be no assurance that any of our future clinical trials will ultimately be successful or support further clinical development of PLN-74809 or any of our other product candidates.

development of bexotegrast or any of our other product candidates.

Product candidates that appear promising in the early phases of development may fail to reach the market for several reasons, including:

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We may experience negative or inconclusive results, which may result in our deciding, or our being required by regulators, to conduct additional clinical studies or trials or abandon some or all of our product development programs, which could have a material adverse effect on our business.

We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of PLN-74809 or any other product candidates.

We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of bexotegrast or any other product candidates.

We may experience delays in initiating or completing clinical trials.

We also may experience numerous unforeseen events during, or as a result of, any future clinical trials that could delay or prevent our ability to receive marketing approval or commercialize PLN-74809 or any other product candidates, including:

We also may experience numerous unforeseen events during, or as a result of, any future clinical trials that could delay or prevent our ability to receive marketing approval or commercialize bexotegrast or any other product candidates, including:

• regulators or institutional review boards, or IRBs, or ethics committees may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site;

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Our ongoing and future clinical trials may reveal significant adverse events or unexpected drug-drug interactions not seen in our preclinical studies and may result in a safety profile that could delay or prevent regulatory approval or market acceptance of any of our product candidates.

We completed our Phase 1a clinical trial of our lead product candidate PLN-74809 in healthy volunteers, and, with the exception of a number of reported minor adverse events, the product candidate was observed to be generally well-tolerated across all doses in 71 trial participants.

However, if significant adverse events or other side effects are observed in

any of our ongoing or future clinical trials, we may have difficulty recruiting patients to our clinical trials, patients may drop out of our trials, or we may be required to abandon the trials or our development efforts altogether.

In addition, in our ongoing Phase 2a clinical trials, we are evaluating PLN-74809 administered with approved IPF agents.

As a result, we may encounter unexpected drug-drug interactions in our planned trials, and may be required to further test these candidates, including in drug-drug interaction studies, which may be expensive, time-consuming and result in delays to our programs.

We completed our Phase 1a clinical trial of our lead product candidate bexotegrast in healthy volunteers, and, with the exception of a number of reported minor adverse events, the product candidate was observed to be generally well-tolerated across all doses in 71 trial participants.

In addition, we announced Positive interim data from our first Phase 2a INTEGRIS-IPF trial in July 2022 and January 2023 in which the product candidate was observed to be well-tolerated over a 12-week treatment period in the 88 patients treated with bexotegrast.

However, if significant adverse events or other side effects are observed in any of our ongoing or future clinical trials, we may have difficulty recruiting patients to our clinical trials, patients may drop out of our trials, or we may be required to abandon the trials or our development efforts altogether.

In addition, in our ongoing Phase 2a clinical trials, we are evaluating bexotegrast administered with approved IPF agents.

We have completed a Phase 1a study evaluating one-way interaction of bexotegrast on nintedanib or pirfenidone, concluding that clinical safety and pharmacokinetic data indicate that no dose adjustments are needed for nintedanib or pirfenidone when combined with bexotegrast.

However, we may encounter unexpected drug-drug interactions in our planned trials, and may be required to further test these candidates, including additional drug-drug interaction studies, which may be expensive, time-consuming and result in delays to our programs.

Some potential therapeutics developed in the biopharmaceutical industry that initially showed therapeutic promise in early-stage trials have later been found to cause side effects that prevented their further development.

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• the risk that patients enrolled in clinical trials will drop out of the trials before completion.

For example, we are initially developing PLN-74809 for the treatment of IPF and PSC, each of which is an orphan indication.

For example, we are initially developing bexotegrast for the treatment of IPF and PSC, each of which is an orphan indication.

In the United States, IPF is estimated to affect approximately 140,000 patients, while PSC is estimated to affect approximately 30,000 to 45,000 patients.

As a result, we may encounter difficulties enrolling subjects in our clinical trials of PLN-74809 due, in part, to the small size of these patient populations.

As a result, we may encounter difficulties enrolling subjects in our clinical trials of bexotegrast due, in part, to the small size of these patient populations.

Moreover, our Phase 2a PET imaging IPF trial is being conducted at a single site, which could limit the availability of IPF patients at the site and may slow enrollment in that specific trial.

In addition, our clinical trials will compete with other clinical trials for product candidates that are in the same therapeutic areas as our product candidates, and this competition will reduce the number and types of patients available to us, because some patients who might have opted to enroll in our trials may instead opt to enroll in a trial being conducted by one of our competitors.

Since the number of qualified clinical investigators is limited, we expect to conduct some of our clinical trials at the same clinical trial sites that some of our competitors use, which will reduce the number of patients who are available for our clinical trials in such clinical trial site.

Since the number of qualified clinical investigators is limited,

we expect to conduct some of our clinical trials at the same clinical trial sites that some of our competitors use, which will reduce the number of patients who are available for our clinical trials in such clinical trial site.

Further, timely enrollment in clinical trials is reliant on clinical trial sites which may be adversely affected by global health matters, including, among other things, pandemics.

For example, our clinical trial sites have been affected by the COVID-19 pandemic.

Commencement of enrollment of our clinical trials of PLN-74809 in IPF and PSC was delayed.

While these trials have resumed patient enrollment, we believe we are experiencing slower than expected enrollment due to the pandemic.

Commencement of enrollment of our clinical trials of bexotegrast in IPF and PSC was delayed.

While these trials have resumed patient enrollment, and in some cases completed enrollment, we believe we have experienced and may continue to experience slower than expected enrollment due to the pandemic.

Also, while the Phase 1 trial of PLN-1474 has completed, this trial experienced delays due to COVID-19.

In addition, after enrollment in these trials, if patients contract COVID-19 during participation in our trials or are subject to isolation or shelter-in-place restrictions, this may cause them to drop out of our trials, miss scheduled doses or follow-up visits or otherwise fail to follow trial protocols.

If patients are unable to follow the trial protocols or if our trial results are

otherwise disputed due to the effects of the COVID-19 pandemic or actions taken to mitigate its spread, the integrity of data from our trials may be compromised or not accepted by the FDA or other regulatory authorities, which would represent a significant setback for the applicable program.

Some factors from the COVID-19 pandemic that we believe may adversely affect enrollment in our trials include:

• the diversion of healthcare resources away from the conduct of clinical trial matters to focus on pandemic concerns, including the attention of infectious disease physicians serving as our clinical trial investigators, hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;

• given that our clinical trials target respiratory indications, patients who would otherwise be candidates for enrollment in our clinical trials, may become infected with coronavirus, which may kill some patients and render others too ill to participate, limiting the available pool of participants for our trials;

• the inability of patients to come to hospitals and universities to participate in our trial, which may force us to conduct our trials in patients’ homes, rendering the trials more difficult and costly to conduct;

• limitations on travel that interrupt key trial activities, such as clinical trial site initiations and monitoring;

• interruption in global shipping affecting the transport of clinical trial materials, such as investigational drug product and comparator drugs used in our trials;

• employee furlough days that delay necessary interactions with local regulators, ethics committees and other important agencies and contractors.

The global outbreak of the COVID-19 pandemic continues to evolve and the conduct of our trials may continue to be adversely affected, despite efforts to mitigate this impact.

If patients are unable to follow the trial protocols or if our trial results are otherwise disputed due to the effects of the COVID-19 pandemic or actions taken to mitigate its spread, the integrity of data from our trials may be compromised or not accepted by the FDA or other regulatory authorities, which would represent a significant setback for the applicable program.

The design or execution of our ongoing and future clinical trials may not support marketing approval.

The design or execution of a clinical trial can determine whether its results will support marketing approval, and flaws in the design or execution of a clinical trial may not become apparent until the clinical trial is well advanced.

We are currently recruiting two Phase 2a trials of PLN-74809 in IPF.

In the first of these trials, the study is designed to enroll IPF patients and utilize a positron emission tomography, or PET, ligand to measure αvß6 target engagement by PLN-74809 in the lungs post-treatment.

The second trial is a 12-week double-blind placebo-controlled trial to evaluate safety, tolerability and PK of up three doses of PLN-74809.

We recently completed enrollment of two Phase 2a trials of bexotegrast in IPF.

In the first of these trials, the study is designed to enroll IPF patients and utilize a positron emission tomography, or PET, ligand to measure αvß6 target engagement by bexotegrast in the lungs post-treatment.

The second trial is a double-blind placebo-controlled trial to evaluate safety, tolerability and pharmacokinetics of bexotegrast in IPF patients for up to 48 weeks at doses of up to 320 mg.

It is possible that we may need to amend our clinical trial, which would require us to resubmit our clinical trial protocols to competent authorities and ethics committees for reexamination, and may impact the costs, timing, or successful completion of such clinical trial.

In addition, we may desire to test PLN-74809 at doses exceeding those evaluated in an ongoing Phase 1a trial and may not be able to do so.

In addition, we may desire to test bexotegrast at doses exceeding those evaluated in an ongoing Phase 1a trial and may not be able to do so.

Additionally, in some instances, there can be significant variability in safety or efficacy results between different trials with the same product candidate due to numerous factors, including differences in trial protocols, size and type of the patient populations, variable adherence to the dosing regimen or other protocol requirements and the rate of dropout among clinical trial participants.

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Although we have received U.S.

orphan drug designation for PLN-74809 for IPF and PSC indications, we may be unable to obtain and maintain orphan drug designation for our other product candidates and, even if we obtain such designation, we may not be able to realize the benefits of such designation, including potential marketing exclusivity of our product candidates, if approved.

orphan drug designation for bexotegrast for IPF and PSC indications and EEA orphan drug designation for bexotegrast for IPF and for PSC we may be unable to obtain and maintain orphan drug designation for our other product candidates and, even if we obtain such designation, we may not be able to realize the benefits of such designation, including potential marketing exclusivity of our product candidates, if approved.

Regulatory authorities in some jurisdictions, including the United States and other major markets, may designate drugs intended to treat conditions or diseases affecting relatively small patient populations as orphan drugs.

Under the Orphan Drug Act of 1983, the FDA may designate a product candidate as an orphan drug if it is intended to treat a rare disease or condition, which is generally defined as having a patient population of fewer than 200,000 individuals in the United States, or a patient population greater than 200,000 in the United States where there is no reasonable expectation that the cost of developing the drug will be recovered from sales in the United States.

Although we have received U.S.

orphan drug designation for PLN-74809 for IPF and PSC indications, the designation of any of our product candidates as an orphan drug does not mean that any regulatory agency will accelerate regulatory review of, or ultimately approve, that product candidate, nor does it limit the ability of any regulatory agency to grant orphan drug designation to product candidates of other companies that treat the same indications as our product candidates.

Generally, if a product candidate with an orphan drug designation receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of marketing exclusivity, which precludes the FDA or foreign regulatory authorities from approving another marketing application for a product that constitutes the same drug treating the same indication for that marketing exclusivity period, except in limited circumstances.

The applicable period is seven years in the United States.

Orphan drug exclusivity may be revoked if any regulatory agency determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the product to meet the needs of patients with the rare disease or condition.

Even if we obtain orphan drug exclusivity for a product candidate, that exclusivity may not effectively protect the product candidate from competition because different drugs can be approved for the same condition in the United States.

Even after an orphan drug is approved, the FDA may subsequently approve another drug for the same condition if the FDA concludes that the latter drug is not the same drug or is clinically superior in that it is shown to be safer, more effective or makes a major contribution to patient care.

In order to obtain orphan designation in the EEA, the product must fulfill certain challenging criteria.

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(1) such product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition;

(2) either the prevalence of such condition must not be more than five in 10,000 persons in the EU when the application is made, or without the benefits derived from orphan status, it must be unlikely that the marketing of the medicine would generate sufficient return in the EU to justify the investment needed for its development;

sufficient return in the EU to justify the investment needed for its development;

and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU or if such a method exists, the product will be of significant benefit to those affected by the condition, as defined in Regulation (EC) 847/2000.

Although we have received U.S.

orphan drug designation for bexotegrast for IPF and PSC and EEA orphan drug designation for bexotegrast for IPF and for PSC, the designation of any of our product candidates as an orphan drug does not mean that any regulatory agency will accelerate regulatory review of, or ultimately approve, that product candidate, nor does it limit the ability of any regulatory agency to grant orphan drug designation to product candidates of other companies that treat the same indications as our product candidates.

Generally, if a product candidate with an orphan drug designation receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of marketing exclusivity, which precludes the FDA or foreign regulatory authorities from approving another marketing application for a product that constitutes a similar medicinal product treating the same indication for that marketing exclusivity period, except in limited circumstances.

The applicable period is seven years in the United States and ten years in the EEA.

The ten-year period of market exclusivity in the EEA can be extended by a further two years if the product qualifies for a pediatric extension, but can be reduced to a period of six years if the orphan designation criteria are no longer met after the fifth year.

Even if we obtain orphan drug exclusivity for a product candidate, that exclusivity may not effectively protect the product candidate from competition because different drugs with different active moieties can be approved for the same condition in the United States or EEA.

Even after an orphan drug is approved, the FDA or EMA, as applicable, may subsequently approve another drug with the same active moiety for the same condition if the FDA concludes that the latter drug is not a similar medicinal product or is clinically superior in that it is shown to be safer, more effective or makes a major contribution to patient care.

In addition, Congress is considering updates to the orphan drug provisions of the FDCA in response to a recent decision by the U.S.

Court of Appeals for the Eleventh Circuit.

Any changes to the orphan drug provisions could change our opportunities for, or likelihood of success in obtaining, orphan drug exclusivity and would materially adversely affect our business, results of operations, financial condition and prospects.

A Fast Track designation by the FDA, even if granted for other current or future product candidates, may not lead to a faster development or regulatory review, licensure process and does not increase the likelihood that our product candidates will receive marketing licensure.

We may seek Fast Track designation for one or more of our future product candidates.

In April 2022, bexotegrast received Fast Track designation for the treatment of IPF.

If a drug product is intended for the treatment of a serious or life-threatening disease or condition and it demonstrates the potential to address unmet medical needs for such a disease or condition, the drug sponsor may apply for FDA Fast Track designation for a particular indication.

We may seek Fast Track designation for our product candidates, but there is no assurance that the FDA will grant this designation to any of our proposed product candidates.

Marketing applications submitted by sponsors of products in Fast Track development may qualify for priority review under the policies and procedures offered by the FDA, but the Fast Track designation does not assure any such qualification or ultimate marketing licensure by the FDA.

The FDA has broad discretion whether or not to grant Fast Track designation, so even if we believe a particular product candidate is eligible for this designation, there can be no assurance that the FDA would decide to grant it.

Even if we do receive Fast Track designation, we may not experience a faster development process, review or licensure compared to conventional FDA procedures or pathways and receiving a Fast Track designation does not provide assurance of ultimate FDA licensure.

In addition, the FDA may withdraw Fast Track designation if it believes that the designation is no longer supported by data from our clinical development program.

In addition, the FDA may withdraw any Fast Track designation at any time.

Changes in methods of product candidate manufacturing or formulation may result in additional costs or delay.

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In addition, there are risks associated with large scale manufacturing for clinical trials or commercial scale including, among others, cost overruns, potential problems with process scale-up, process reproducibility, stability issues, compliance with good manufacturing practices, lot consistency and timely availability of raw materials.

authorities, to produce it in sufficient quantities to meet the requirements for the potential commercial launch of the product or to meet potential future demand.

Even if we obtain marketing approval for any of our product candidates, there is no assurance that our manufacturers will be able to manufacture the approved product to specifications acceptable to the FDA or other comparable foreign regulatory authorities, to produce it in sufficient quantities to meet the requirements for the potential commercial launch of the product or to meet potential future demand.

Additionally, if we advance a biological candidate into IND-enabling studies, the manufacturing processes for biological products is more complex and expensive than with small molecule products and additional manufacturing suppliers may be needed to manufacture clinical supplies for these programs.

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If product liability lawsuits are brought against us, we may incur substantial financial or other liabilities and may be required to limit commercialization of our product candidates.

We face an inherent risk of product liability as a result of testing PLN-74809 and any of our other product candidates in clinical trials and will face an even greater risk if we commercialize any products.

We face an inherent risk of product liability as a result of testing bexotegrast and any of our other product candidates in clinical trials and will face an even greater risk if we commercialize any products.

For example, we may be sued if our product candidates cause or are perceived to cause injury or are found to be otherwise unsuitable during clinical trials, manufacturing, marketing or sale.

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Our inability to obtain sufficient product liability insurance at an acceptable cost to protect against potential product liability claims could prevent or inhibit the commercialization of products we develop.

We will need to obtain additional insurance for clinical trials as PLN-74809 continues clinical development and as additional product candidates enter the clinic.

We will need to obtain additional insurance for clinical trials as bexotegrast continues clinical development and as additional product candidates enter the clinic.

However, we may be unable to obtain, or may obtain on unfavorable terms, clinical trial insurance in amounts adequate to cover any liabilities from any of our clinical trials.

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Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, more convenient or less expensive than any products that we may develop.

Furthermore, products currently approved for other indications could be discovered to be effective treatments of fibrosis as well, which could give such products significant regulatory and market timing advantages over PLN-74809 or other product candidates that we may identify.

Furthermore, products currently approved for other indications could be discovered to be effective treatments of fibrosis as well, which could give such products significant regulatory and market timing advantages over bexotegrast or other product candidates that we may identify.

Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market.

Additionally, products or technologies developed by our competitors may render our potential product candidates uneconomical or obsolete and we may not be successful in marketing any product candidates we may develop against competitors.

Additionally, products or technologies developed by our competitors may render our potential product candidates uneconomical or obsolete and we may not be successful in

marketing any product candidates we may develop against competitors.

The availability of competitive products could limit the demand, and the price we are able to charge, for any products that we may develop and commercialize.

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Even if a product candidate we develop receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success.

Even if PLN-74809 or any other product candidate we develop receives marketing approval, it may nonetheless fail to gain sufficient market acceptance by physicians, patients and third-party payors.

Even if bexotegrast or any other product candidate we develop receives marketing approval, it may nonetheless fail to gain sufficient market acceptance by physicians, patients and third-party payors.

In addition, the availability of coverage by third-party payors may be affected by existing and future health care reform measures designed to reduce the cost of health care.

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• the strength of marketing and distribution support;

• the ability to obtain sufficient third-party coverage and adequate reimbursement;

• the ability to obtain sufficient third-party coverage and adequate reimbursement and a positive recommendation by health technology bodies;

• the prevalence and severity of any side effects.

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• neither experimental nor investigational.

In the United States, no uniform policy of coverage and reimbursement for products exists among third-party payors.

In the United States as well as foreign jurisdictions, no uniform policy of coverage and reimbursement for products exists among third-party payors.

Coverage and reimbursement for products may vary depending on the payor, the insurance plan, and other factors.

As a result, obtaining coverage and reimbursement approval of a product from a government or other third-party payor is a time-consuming and costly process that could require us to provide to each payor supporting scientific, clinical and cost-effectiveness data for the use of our products on a payor-by-payor basis, with no assurance that coverage and adequate reimbursement will be obtained.

A primary trend in the healthcare industry is cost containment as government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement available for certain medications.

Even if we obtain coverage for a given product, the resulting reimbursement payment rates might not be adequate for us to achieve or sustain profitability or may require co-payments that patients find unacceptably high.

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It is difficult to predict at this time what third-party payors will decide with respect to the coverage and reimbursement for our product candidates, if approved.

A primary trend in the United States health care industry is toward cost containment, as government authorities, third-party payors, and others have attempted to control costs by limiting coverage and the amount of reimbursement available for certain treatments.

A primary trend in the United States and European health care industries is toward cost containment, as government authorities, third-party payors, and others have attempted to control costs by limiting coverage and the amount of reimbursement available for certain treatments.

Such third-party payers, including Medicare, may question the coverage of, and challenge the prices charged for medical products, and many third-party payers limit coverage and reimbursement for newly approved health care products.

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If any of our product candidates ultimately receives regulatory approval, we expect to establish a marketing and sales organization with technical expertise and supporting distribution capabilities to commercialize each such product in major markets, which will be expensive and time consuming.

We have no prior experience as a company in the marketing, sale and distribution of pharmaceutical products and there are significant risks involved in building and managing a sales organization, including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads,

provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team.

We have no prior experience as a company in the marketing, sale and distribution of pharmaceutical products and there are significant risks involved in building and managing a sales

organization, including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team.

Any failure or delay in the development of our internal sales, marketing and distribution capabilities would adversely impact the commercialization of these products.

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Even if we receive regulatory approval of any product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and we may be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our product candidates.

If any of our product candidates are approved, they will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, promotion, sampling, record-keeping, conduct of post-marketing studies and submission of safety, efficacy and other post-market information, including both federal and state requirements in the United States and requirements of comparable foreign regulatory authorities.

In addition, we will be subject to

continued compliance with current Good Manufacturing Practice, or cGMP, and Good Clinical Practice, or GCP, requirements for any clinical trials that we conduct post-approval.

If any of our product candidates are approved, they will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, advertising, promotion, sampling, record-keeping, conduct of post-marketing studies, pharmacovigilance, and submission of safety, efficacy and other post-market information, including both federal

and state requirements in the United States and requirements of comparable foreign regulatory authorities.

In addition, we will be subject to continued compliance with current Good Manufacturing Practice, or cGMP, and Good Clinical Practice, or GCP, requirements for any clinical trials that we conduct post-approval.

Manufacturers and their facilities are required to comply with extensive FDA and comparable foreign regulatory authority requirements, including ensuring that quality control and manufacturing procedures conform to cGMP regulations.

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In addition, if the FDA or a comparable foreign regulatory authority approves our product candidates, we will have to comply with requirements including submissions of safety and other post-marketing information and reports and registration.

The FDA may impose consent decrees or withdraw approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market.

The FDA or any other foreign regulatory authority may impose consent decrees or 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 our product candidates, including adverse events of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information;

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In the United States, there have been and continue to be a number of legislative initiatives to contain healthcare costs, as detailed in Part I, Item 1 – Business – Government Regulation – Current and Future Healthcare Reform Legislation.

For example, in August 2022, President Biden signed into law the IRA, which implements substantial changes to the Medicare program, including drug pricing reforms and changes to the Medicare Part D benefit design.

Among other reforms, the IRA imposes inflation rebates on drug manufacturers for products reimbursed under Medicare Parts B and D if the prices of those products increase faster than inflation;

implements changes to the Medicare Part D benefit that, beginning in 2025, will cap benefit annual out-of-pocket spending at $2,000, while imposing new discount obligations for pharmaceutical manufacturers;

and, beginning in 2026, establishes a “maximum fair price” for a fixed number of high spend pharmaceutical and biological products covered under Medicare Parts B and D following a price negotiation process with the Centers for Medicare and Medicaid Services.

The IRA explicitly excludes from price negotiation orphan drugs designated for only one rare disease or condition and for which the only approved indication is for such disease or condition.

However, those drugs with multiple orphan designations are not explicitly excluded from drug price negotiation.

We cannot predict the likelihood, nature, or extent of health reform initiatives that may arise from future legislation or administrative action.

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

Separately, since March 2020 when foreign and domestic inspections were largely placed on hold due to the COVID-19 pandemic, the FDA has been working to resume routine surveillance, bioresearch monitoring and pre-approval inspections on a prioritized basis.

The FDA has developed a rating system to assist in determining when and where it is safest to conduct prioritized domestic inspections and resumed inspections in China and India in early 2021.

In April 2021, the FDA issued guidance for industry formally announcing plans to employ remote interactive evaluations, using risk management methods, to meet user fee commitments and goal dates.

Should the FDA determine that an inspection is necessary for approval and an inspection cannot be completed during the review cycle due to restrictions on travel, and the FDA does not determine a remote interactive evaluation to be appropriate, the agency has stated that it generally intends to issue a complete response letter.

Further, if there is inadequate information to make a determination on the acceptability of a facility, the FDA may defer action on the application until an inspection can be completed.

Additionally, as of March 18, 2021, the FDA noted it is continuing to ensure timely reviews of applications for medical products during the COVID-19 pandemic in line with its user fee performance goals and conducting mission critical domestic and foreign inspections to ensure compliance of manufacturing facilities with the FDA quality standards.

Acknowledging the need for transparency an planning for the resumption of inspection activities, FDA released a roadmap plan in May 2021, and an update in November 2021, to address FDA’s risk-based approach to addressing postponed inspection work and its goal of transitioning back to conducting domestic surveillance inspections as quickly as possible.

However, the FDA may not be able to continue its current pace and approval timelines could be extended, including where a pre-approval inspection or an inspection of clinical sites is required and due to the COVID-19 pandemic and travel restrictions FDA is unable to complete such required inspections during the review period.

Ongoing surges in COVID-19 case numbers with the emergence of new variants (e.g., the Omicron variant in late 2021) have contributed to interruptions in FDA’s surveillance capabilities.

In light of high positivity rates and hospitalizations, FDA made temporary changes in late 2021, including temporarily postponing certain inspection activities from December 29, 2021 to January 19, 2022.

Accordingly, during the COVID-19 pandemic, several companies have announced receipt of complete response letters due to the FDA's inability to complete required inspections for their applications.

Regulatory authorities outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic.

Separately, between March 2020 and February 2022, foreign and domestic inspections were largely placed on hold due to the COVID-19 pandemic.

Regulatory authorities outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 or other future pandemics.

If a prolonged government shutdown occurs, or if global health concerns continue to prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

Further, in our operations as a public company, future

government shutdowns could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

EU drug marketing and reimbursement regulations may materially affect our ability to market and receive coverage for our products in the European Union member states.

Further, in our operations as a public company, future government shutdowns could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

Drug marketing and reimbursement regulations may materially affect our ability to market and secure reimbursement for our products.

We intend to seek approval to market our product candidates in both the United States and in selected foreign jurisdictions.

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In these countries, pricing negotiations with governmental authorities can take considerable time after obtaining marketing approval of a product candidate.

Furthermore, in many European countries (including the UK), effective access to the market depends on whether the product obtains a positive recommendation from the relevant health technology assessment body.

In addition, market acceptance and sales of our product candidates will depend significantly on the availability of adequate coverage and reimbursement from third-party payors for our product candidates and may be affected by existing and future health care reform measures.

Much like the federal Anti-Kickback Statute prohibition in the United States, the provision of benefits or advantages to induce or reward improper performance generally to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order or use of medicinal products is also prohibited in the EU.

endorsement, purchase, supply, order or use of medicinal products is also prohibited in the EU.

The provision of benefits or advantages to induce or reward improper performance generally is governed by the national anti-bribery laws of EU Member States, and in respect of the U.K.

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Infringement of these laws could result in substantial fines and imprisonment.

EU Directive 2001/83/EC, which is the EU Directive governing medicinal products for human use, further provides that, where medicinal products are being promoted to persons qualified to prescribe or supply them, no gifts, pecuniary advantages or benefits in kind may be supplied, offered or promised to such persons unless they are inexpensive and relevant to the practice of medicine or pharmacy.

EU Directive 2001/83/EC, which is the EU Directive governing medicinal products for human use, further provides that, where medicinal products are being promoted to persons qualified to prescribe, recommend, use, procure or supply them, no gifts, pecuniary advantages or benefits in kind may be supplied, offered or promised to such persons unless they are inexpensive and relevant to the practice of medicine or pharmacy.

This provision has been transposed into the Human Medicines Regulations 2012 and so remains applicable in the U.K.

despite its departure from the EU.

Payments made to physicians in certain EU Member States must be publicly disclosed.

Payments made to physicians in certain EU Member States and more generally throughout Europe (including the UK) and other countries must be publicly disclosed under applicable transparency provisions..

Moreover, agreements with physicians often must be the subject of prior notification and approval by the physician’s employer, his or her competent professional organization and/or the regulatory authorities of the individual EU Member States.

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Failure to comply with these requirements could result in reputational risk, public reprimands, administrative penalties, fines or imprisonment.

In addition, in most foreign countries, including the European Economic Area, or EEA, the proposed pricing for a drug must be approved before it may be lawfully marketed.

The requirements governing drug pricing and reimbursement vary widely from country to country.

In addition, in most foreign countries, including the EEA, the proposed pricing for a drug must be approved before it may be lawfully marketed.

The requirements governing drug pricing and reimbursement are the prerogative of the Member States and vary widely from country to country.

For example, the 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.

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In some countries, we may be required to conduct a clinical study or other studies that compare the cost-effectiveness of any of our product candidates to other available therapies in order to obtain or maintain reimbursement or pricing approval.

There can be no assurance that any country that has price controls or reimbursement limitations for biopharmaceutical products will allow favorable reimbursement and pricing arrangements for any of our products.

There can be no assurance that any country that has price controls or reimbursement limitations for biopharmaceutical products will allow or maintain favorable reimbursement and pricing arrangements for any of our products.

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

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individual or business entity from paying, offering, authorizing payment, or offering of anything of value, directly or indirectly, to any foreign official, political party or candidate for the purpose of influencing any act or decision of the foreign entity in order to assist the individual or business in obtaining or retaining business.

corporation, including international subsidiaries, and to devise and maintain an adequate system of internal accounting controls for international operations.

The FCPA also obligates companies whose securities are listed in the United States to comply with certain accounting provisions requiring the company to maintain books and records that accurately and fairly reflect all transactions of the corporation, including international subsidiaries, and to devise and maintain an adequate system of internal accounting controls for international operations.

Compliance with the FCPA is expensive and difficult, particularly in countries in which corruption is a recognized problem.

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The failure to comply with laws governing international business practices may result in substantial civil and criminal penalties and suspension or debarment from government contracting.

The Securities and Exchange Commission, or SEC, also may suspend or bar issuers from trading securities on U.S.

The Securities and Exchange Commission,

or SEC, also may suspend or bar issuers from trading securities on U.S.

exchanges for violations of the FCPA’s accounting provisions.

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It is difficult and costly to protect our proprietary rights and technology, and we may not be able to ensure their protection.

Our business will depend in large part on obtaining and maintaining patent, trademark and trade secret protection of our proprietary technologies and our product candidates, their respective components, synthetic intermediates, formulations, combination therapies, methods used to manufacture them and methods of treatment, as well as successfully defending these patents against third-party challenges.

Our business will depend in large part on obtaining and maintaining patent, IP regulatory rights (such as data exclusivity, marketing exclusivity and patent extensions) trademark and trade secret protection of our proprietary technologies and our product candidates, their respective components, synthetic intermediates, formulations, combination therapies, methods used to manufacture them and methods of treatment, as well as successfully defending these patents against third-party challenges.

Our ability to stop unauthorized third parties from making, using, selling, offering to sell or importing our product candidates is dependent upon the extent to which we have rights under valid and enforceable patents that cover these activities and whether a court would issue an injunctive remedy.

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The strength of patents in the biotechnology and biopharmaceutical field involves complex legal and scientific questions and can be uncertain.

The patent applications that we own or in-license may fail to result in issued

patents with claims that cover our product candidates or uses thereof in the United States or in other foreign countries.

The patent applications that we own or in-license may fail to result in issued patents with claims that cover our product candidates or uses thereof in the United States or in other foreign countries.

Even if the patents do successfully issue, third parties may challenge the validity, enforceability, or scope thereof, which may result in such patents being narrowed, invalidated, or held unenforceable.

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Furthermore, for United States applications in which all claims are entitled to a priority date before March 16, 2013, an interference proceeding can be provoked by a third-party or instituted by the United States Patent and Trademark Office, or USPTO, to determine who was the first to invent any of the subject matter covered by the patent claims of our applications.

Similarly, for United States applications in which at least one claim is not entitled to a priority date before March 16, 2013, derivation proceedings can be instituted to determine whether the subject matter of a patent claim was derived from a prior inventor’s disclosure.

Similarly, for United States applications in which at least

one claim is not entitled to a priority date before March 16, 2013, derivation proceedings can be instituted to determine whether the subject matter of a patent claim was derived from a prior inventor’s disclosure.

We may be required to disclaim part or all of the term of certain patents or all of the term of certain patent applications.

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• it is possible that there are prior public disclosures that could invalidate our or our licensors’ patents, as the case may be, or parts of our or their patents;

• it is possible that others may circumvent our owned or in-licensed patents;

• it is possible that others may circumvent our owned or in-licensed patents or regulatory intellectual property rights such as our data protection, orphan market exclusivity and others;

• it is possible that there are unpublished applications or patent applications maintained in secrecy that may later issue with claims covering our products or technology similar to ours;

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In connection with our efforts to expand our pipeline of product candidates, we may enter into certain licenses or other collaboration agreements in the future pertaining to the in-license of rights to additional candidates.

Such agreements may impose various diligence, milestone payment, royalty, insurance, or other obligations on us.

Such agreements may impose various diligence, milestone payment, royalty, insurance, or other obligations on us, subject to antitrust law restrictions.

If we fail to comply with these obligations, our licensor or collaboration partners may have the right to terminate the relevant agreement, in which event we would not be able to develop or market the products covered by such licensed intellectual property.

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The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Moreover, if disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates, which could have a material adverse effect on our business, financial conditions, results of operations, and prospects.

Moreover, if disputes over intellectual property that we have licensed prevent or impair

our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates, which could have a material adverse effect on our business, financial conditions, results of operations, and prospects.

In addition, we may have limited control over the maintenance and prosecution of these in-licensed patents and patent applications, or any other intellectual property that may be related to our in-licensed intellectual property.

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It is our policy to require our employees, consultants, outside scientific collaborators, sponsored researchers and other advisors to execute confidentiality agreements upon the commencement of employment or consulting relationships with us.

These agreements provide that all confidential

information concerning our business or financial affairs developed by or made known to the individual or entity during the course of the party’s relationship with us is to be kept confidential and not disclosed to third parties except in specific circumstances.

These agreements provide that all confidential information concerning our business or financial affairs developed by or made known to the individual or entity during the course of the party’s relationship with us is to be kept confidential and not disclosed to third parties except in specific circumstances.

In the case of employees, the agreements provide that all inventions conceived by the individual, and which are related to our current or planned business or research and development or made during normal working hours, on our premises or using our equipment or proprietary information, are our exclusive property.

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There is a substantial amount of litigation involving patents and other intellectual property rights in the biotechnology and biopharmaceutical industries, as well as administrative proceedings for challenging patents, including interference, derivation, inter partes review, post grant review, and reexamination proceedings before the USPTO or oppositions and other comparable proceedings in foreign jurisdictions.

We may be exposed to, or threatened with, future litigation by third parties having patent or other intellectual property rights alleging that our product candidates and/or proprietary technologies infringe their intellectual property rights.

We may be exposed to, or threatened with, future litigation by third parties having patent or other intellectual property rights alleging that our product candidates and/or proprietary

technologies infringe their intellectual property rights.

Numerous U.S.

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In addition, third parties may obtain patents in the future and claim that use of our technologies infringes upon these patents.

If any third-party patent were held by a court of competent jurisdiction to cover our product candidates, intermediates used in the manufacture of our product candidates or our materials generally, aspects of our formulations or methods of use, the holders of any such patent may be able to block our ability to develop and commercialize the product candidate unless we obtained a license or until such patent expires or is finally determined to be held invalid or unenforceable.

holders of any such patent may be able to block our ability to develop and commercialize the product candidate unless we obtained a license or until such patent expires or is finally determined to be held invalid or unenforceable.

In either case, such a license may not be available on commercially reasonable terms or at all.

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Our competitors may have filed, and may in the future file, patent applications covering our products or technology similar to ours.

patent application may have priority over our owned and in-licensed patent applications or patents, which could require us to obtain rights to issued patents covering such technologies.

Any such patent application may have priority over our owned and in-licensed patent applications or patents, which could require us to obtain rights to issued patents covering such technologies.

If another party has filed a U.S.

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Upon the expiration of our current patents, we may lose the right to exclude others from practicing these inventions.

The expiration of these patents could also have a similar material adverse effect on our

business, results of operations, financial condition and prospects.

The expiration of these patents could also have a similar material adverse effect on our business, results of operations, financial condition and prospects.

We own pending patent applications covering our proprietary technologies or our product candidates that if issued as patents are expected to expire from 2037 through 2044, without taking into account any possible patent term adjustments or extensions.

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Assuming that other requirements for patentability are met, prior to March 16, 2013, in the United States, the first to invent the claimed invention was entitled to the patent, while outside the United States, the first to file a patent application was entitled to the patent.

On March 16, 2013, under the Leahy-Smith America Invents Act, or the America Invents Act, enacted in September 2011, the United States transitioned to a first inventor to file system in which, assuming that other requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent on an invention regardless of whether a third party was the first to invent the claimed invention.

On March 16, 2013, under the Leahy-Smith America Invents Act, or the America Invents Act, enacted in September 2011, the United States transitioned to a first inventor to file system.

A third party that files a patent application in the USPTO on or after March 16, 2013, but before us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by such third party.

This will require us to be cognizant of the time from invention to filing of a patent application.

Since patent applications in the United States and most other countries are confidential for a period of time after filing or until issuance, we cannot be certain that we or our licensors were the first to either (i) file any patent application related to our product candidates or (ii) invent any of the inventions claimed in our or our licensor’s patents or patent applications.

Since patent applications in the United States and most other countries are confidential for a period of time after filing or until issuance, we cannot be certain that we or our

licensors were the first to either (i) file any patent application related to our product candidates or (ii) invent any of the inventions claimed in our or our licensor’s patents or patent applications.

The America Invents Act also includes a number of significant changes that affect the way patent applications will be prosecuted and also may affect patent litigation.

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Depending on future actions by the U.S.

Congress, the federal courts, and the USPTO, the laws and regulations governing patents could change in unpredictable ways that could have a material adverse effect on our existing patent portfolio and our ability to protect and enforce our intellectual property in the future.

Congress, the federal courts, the USPTO, and courts or legislative bodies in foreign jurisdictions, the laws and regulations governing patents could change in unpredictable ways that could have a material adverse effect on our existing patent portfolio and our ability to protect and enforce our intellectual property in the future.

We have limited foreign intellectual property rights and may not be able to protect our intellectual property rights throughout the world.

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Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions.

The legal systems of certain countries, particularly certain developing countries, do not favor

the enforcement of, and may require a compulsory license to, patents, trade secrets and other intellectual property protection, particularly those relating to biopharmaceutical products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products against third parties in violation of our proprietary rights generally.

The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of, and may require a compulsory license to, patents, trade secrets and other intellectual property protection, particularly those relating to biopharmaceutical products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products against third parties in violation of our proprietary rights generally.

The initiation of proceedings by third parties to challenge the scope or validity of our patent rights in foreign jurisdictions could result in substantial cost and divert our efforts and attention from other aspects of our business.

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Even if patents covering our product candidates are obtained, once the patent life has expired, we may be open to competition from competitive products.

Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized.

Given the amount of time required for the development, testing and regulatory

review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized.

As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.

At the EU level, the Court of Justice of the European Union (CJEU) has recently narrowed the availability of patent term extension for second medical use therefore affecting the scope of patent protection available.

At the EU level, the Court of Justice of the European Union, or CJEU, has recently narrowed the availability of patent term extension for second medical use therefore affecting the scope of patent protection available.

If we do not obtain patent term extension and data exclusivity for any product candidates we may develop, our business may be materially harmed.

Depending upon the timing, duration, and specifics of any FDA marketing approval of any product candidates we may develop, one or more of our U.S.

Depending upon the timing, duration, and specifics of any FDA or foreign marketing approval of any product candidates we may develop, one or more of our U.S.

patents may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration Action of 1984 Hatch-Waxman Amendments.

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Moreover, the applicable time period or the scope of patent protection afforded could be less than we request.

In addition, within the EU, regulatory protections afforded to medicinal products such as data exclusivity, marketing protection, market exclusivity for orphan indications and pediatric extensions are currently under review and could be curtailed in future years.

If we are unable to obtain patent term extension or the term of any such extension is less than we request, or if data exclusivity or other regulatory protections are reduced, our competitors may obtain approval of competing products following our patent expiration, and our business, financial condition, results of operations, and prospects could be materially harmed.

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In October 2019, we entered into a license and collaboration agreement with Novartis for the development and commercialization of our then preclinical product candidate, PLN-1474, and up to three integrin research targets.

In December 2019, we received an upfront license payment of $50.0 million for the worldwide exclusive license to PLN-1474 and, upon achievement of the first patient dosing milestone, received a payment of $25.0 million in the second quarter of 2020.

Pursuant to the Novartis Agreement, we expect to receive research and development funding totaling up to $19.6 million for PLN-1474 development services and funding of up to $13.4 million for optional research and development

services on the integrin research targets.

Additionally, we are eligible to receive additional developmental, regulatory and commercial milestone payments of up to $391.0 million if defined development, regulatory and commercialization milestones are achieved and tiered royalties, on a product-by-product basis based on annual net sales of products, at percentages ranging from high-single digits to low teens of the applicable licensed products and mid-single digits to high-single digits for any products resulting from the research programs.

The IND application candidate was transferred to Novartis in the first quarter of 2021, and Novartis is responsible for all PLN-1474 development, manufacturing, and commercialization activities after the initial development period.

As a result, we are reliant on Novartis and its efforts and capabilities with respect to the advancement of this candidate.

If we or our collaborators are unable to successfully advance the development of our product candidates, including PLN-1474, or achieve milestones, revenue and cash resources from milestone payments under our collaboration agreements will be substantially less than expected.

In December 2019, we received an upfront license payment of $50.0 million for the worldwide exclusive license to PLN-1474 and have subsequently earned $29.0 million of the $416.0 million developmental, regulatory and commercial milestones under the arrangement.

In the second quarter of 2022 we recognized a $4.0 million target validation fee as Novartis exercised their right to opt-in to a research program and secured an exclusive license to compounds associated with an integrin reseach target.

Pursuant to the Novartis Agreement, as amended, we expect to receive research and development funding totaling up to $20.0 million for PLN-1474 development services and funding of up to $18.4 million for optional research and development services on the integrin research targets.

Substantially all of the services contemplated under the development plan and associated with integrin research targets had been completed as of December 31, 2022.

As part of a broad strategic realignment, Novartis has discontinued clinical development in NASH and, as a result, discontinued development of PLN-1474.

In February 2023, Novartis issued a termination notice for the collaboration and license agreement, and returned global rights to Pliant for PLN-1474.

We may pursue additional collaborations to further clinical development of PLN-1474.

Accordingly, we may become reliant upon the efforts and capabilities of others with respect to the advancement of this candidate.

If we or our potential future collaborators are unable to successfully advance the development of our product candidates, including PLN-1474, or achieve milestones, revenue and cash resources from milestone payments under our collaboration agreements will be substantially less than expected.

In addition, to the extent that any of our existing or future collaborators were to terminate a collaboration agreement, we may be forced to independently develop these product candidates, including funding preclinical or clinical trials, assuming marketing and distribution costs and defending intellectual property rights, or, in certain instances, abandon product candidates altogether, any of which could result in a change to our business plan and a material and adverse effect on our business, financial condition, results of operations and prospects.

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If so, we may not be able to reach agreements with alternative partners or do so on terms acceptable to us.

If we are unable to enter into such agreements, our research and development activities will be delayed and our ability to implement a key part of our development strategy will be compromised.

Because we rely on third-party manufacturing and supply vendors, our supply of research and development, preclinical and clinical development materials may become limited or interrupted or may not be of satisfactory quantity or quality.

If we are unable to enter into

such agreements, our research and development activities will be delayed and our ability to implement a key part of our development strategy will be compromised.

Because we rely on third-party manufacturing and supply vendors, including single-source vendors and vendors in foreign jurisdictions, including China, our supply of research and development, preclinical and clinical development materials may become limited or interrupted or may not be of satisfactory quantity or quality.

We rely on third-party contract manufacturers to manufacture our product candidates for preclinical studies and clinical trials.

We do not own manufacturing facilities for producing any clinical trial product supplies.

There can be no assurance that our preclinical and clinical development product supplies will not be limited, interrupted, or of satisfactory quality or continue to be available at acceptable prices.

For example, the extent to which the COVID-19 pandemic impacts our ability to procure sufficient supplies for the development of our product candidates will depend on the severity and duration of the spread of the virus, and the actions undertaken to contain COVID-19 or treat its effects.

In particular, any replacement of our manufacturers could require significant effort and expertise because there may be a limited number of qualified replacements.

In addition, three vaccines for COVID-19 were granted Emergency Use Authorization by the FDA in late 2020 and early 2021, and more are likely to be authorized in the coming months.

There can be no assurance that our preclinical and clinical development product supplies will not be limited, interrupted, or of satisfactory quality or continue to be available at acceptable prices, including due to ongoing effects of the COVID-19 pandemic.

In addition, we rely on vendors in foreign jurisdictions, including China for our clinical drug supply for bexotagrast.

If this supply is interrupted for business or geopolitical reasons, the development of bexotagrast could be materially delayed.

In particular, any replacement of our manufacturers could require significant time, effort and expertise because there may be a limited number of qualified replacements and the process to transfer technology and initiate manufacturing is complex and time consuming.

In addition, three vaccines for COVID-19 were granted Emergency Use Authorization by the FDA in late 2020 and early 2021.

The resultant demand for vaccines and potential for manufacturing facilities and materials to be commandeered under the Defense Production Act of 1950, equivalent foreign legislation or heightened demand on manufacturers may make it more difficult to obtain materials or manufacturing slots for the products needed for our development efforts, which could lead to delays in our clinical trials and scientific development efforts.

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The delays associated with the verification of a new manufacturer could negatively affect our ability to develop product candidates in a timely manner or within budget.

We expect to continue to rely on third-party manufacturers if we receive regulatory approval for PLN-74809 or any other product candidate.

We expect to continue to rely on third-party manufacturers if we receive regulatory approval for bexotegrast or any other product candidate.

To the extent that we have existing, or enter into future, manufacturing arrangements with third parties, we will depend on these third parties to perform their obligations in a timely manner consistent with contractual and regulatory requirements, including those related to quality control and assurance.

If we are unable to obtain or maintain third-party manufacturing for product candidates, or to do so on commercially reasonable terms, we may not be

able to develop and commercialize our product candidates successfully.

If we are unable to obtain or maintain third-party manufacturing for product candidates, or to do so on commercially reasonable terms, we may not be able to develop and commercialize our product candidates successfully.

Our or a third-party’s failure to execute on our manufacturing requirements and comply with cGMP could adversely affect our business in a number of ways, including:

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• in the event of approval to market and commercialize a product candidate, an inability to meet commercial demands for our products.

We rely on a sole supplier for the manufacture of PLN-74809.

We rely on a sole supplier for the manufacture of bexotegrast.

If this sole supplier is unable to supply to us in the quantities we require, or at all, or otherwise defaults on its supply obligations to us, we may not be able to obtain alternative supplies from other suppliers on acceptable terms, in a timely manner, or at all.

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• collaborators with marketing and distribution rights to one or more of our product candidates that achieve regulatory approval may not commit sufficient resources to the marketing and distribution of such product or products;

• collaborators may not provide us with timely and accurate information regarding development progress and activity under any future license agreement, which could adversely impact our ability to report progress to our investors and otherwise plan development of our product candidates;

• collaborators may not provide us with timely and accurate information regarding development progress and activity under any future license agreement, which could

adversely impact our ability to report progress to our investors and otherwise plan development of our product candidates;

• disagreements with collaborators, including disagreements over proprietary rights, contract interpretation or the preferred course of development, might cause delays or terminations of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive;

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The outbreak of the coronavirus disease, COVID-19, could adversely impact our business, including our preclinical studies and clinical trials.

In December 2019, a novel strain of the coronavirus disease, COVID-19, was identified in Wuhan, China.

This virus has spread to a number of countries globally, including the United States.

The outbreak and government measures taken in response have also had a significant impact, both direct and indirect, on businesses and commerce, as worker shortages have occurred;

The outbreak of COVID-19 and government measures taken in response thereto have had a significant impact, both direct and indirect, on businesses and commerce, as worker shortages have occurred;

supply chains have been disrupted;

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and demand for certain goods and services, such as medical services and supplies, has spiked, while demand for other goods and services, such as travel, has fallen.

In response to the spread of COVID-19, we significantly limited access to our executive offices with the majority of our administrative employees continuing their work outside of our offices and limited the presence of our staff in the laboratory and in the administrative spaces to levels that adhere to social distancing protocols.

In response to the initial spread of COVID-19, we significantly limited access to our executive offices with the majority of our administrative employees continuing their work outside of our offices and limited the presence of our staff in the laboratory and in the administrative spaces to levels that adhere to social distancing protocols.

As a result of the COVID-19 pandemic, we have experienced disruptions and may continue to experience disruptions that could severely impact our business, preclinical studies and clinical trials, including:

• delays or difficulties in commencing enrollment of patients in our clinical trials, including our Phase 2a clinical trials of PLN-74809 in IPF and PSC and our Phase 1 clinical trial of PLN-1474.

With respect to the Phase 2a trials of PLN-74809 in IPF and PSC, following delays in site initiation due to the impacts of COVID-19, both trials have resumed active enrollment of patients.

With respect to the Phase 1 trial of PLN-1474, the Phase 1 trial site experienced delays due to its location in an area heavily impacted by COVID-19;

however, the trial site reopened and completed dosing the remaining cohorts, and the trial was subsequently completed;

• the impact from potential delays, including potential difficulties in clinical site initiation, including difficulties in recruiting clinical site investigators and clinical site staff;

• diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;

• interruption of key clinical trial activities, such as clinical trial site data monitoring, due to limitations on travel imposed or recommended by federal or state governments, employers and others or interruption of clinical trial subject visits and study procedures that are deemed non-essential, which may impact the integrity of subject data and clinical study endpoints;

• delays or difficulties in commencing enrollment of patients in our clinical trials

• the impact from potential delays, including potential difficulties in clinical site initiation and related processes such as in recruiting clinical site investigators and clinical site staff;

• diversion of healthcare resources, including employee resources, away from the conduct of preclinical studies and clinical trials;

• interruption of key clinical trial activities, such as clinical trial site data monitoring, due to any future limitations on travel or interruption of clinical trial subject visits and study procedures that are deemed non-essential, which may impact the integrity of subject data and clinical study endpoints;

• interruption or delays in the operations of the FDA or other regulatory authorities, which may impact review and approval timelines;

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• interruptions in preclinical studies due to restricted or limited operations at our laboratory facility;

• limitations on employee resources that would otherwise be focused on the conduct of our preclinical studies and clinical trials, including because of sickness of employees or their families or the desire of employees to avoid contact with large groups of people;

• interruption or delays to our sourced discovery and clinical activities.

The COVID-19 pandemic continues to rapidly evolve and new variants of the virus continue to emerge.

The extent to which the outbreak impacts our business, preclinical studies and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the pandemic, travel restrictions and social distancing in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease.The foregoing disruptions, and other continued disruptions to our business in connection with the COVID-19 pandemic, could have a material adverse impact on our business, financial condition or results of operations.

The COVID-19 pandemic continues to rapidly evolve and new variants and subvariants of the virus continue to emerge.

The extent to which the outbreak impacts our business, preclinical studies and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the ultimate geographic spread of the disease, the duration of the pandemic, renewed travel restrictions and social distancing in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease.

The foregoing disruptions, and other continued disruptions to our business in connection with the COVID-19 pandemic, could have a material adverse impact on our business, financial condition or results of operations.

In addition, the COVID-19 pandemic heightens many of the other risks and uncertainties discussed herein.

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As of December 31, 2022, we had 124 full-time employees.

As our clinical development and commercialization plans and strategies develop, and as we transition into operating as a public company, we will need to expand our managerial, clinical, regulatory, sales, marketing, financial, development, manufacturing and legal capabilities or contract with third parties to provide these capabilities for us.

As our clinical development and commercialization plans and strategies develop, we will need to expand our managerial, clinical, regulatory, sales, marketing, financial, development, manufacturing and legal capabilities or contract with third parties to provide these capabilities for us.

As our operations expand, we expect that we will need to manage additional relationships with various strategic collaborators, suppliers and other third parties.

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• identifying, recruiting, integrating, maintaining and motivating additional employees;

• managing our development and commercialization efforts effectively, including the clinical and FDA review process for PLN-74809 and any other product candidates, while complying with our contractual obligations to contractors and other third parties;

• managing our development and commercialization efforts effectively, including the clinical and FDA review process for bexotegrast and any other product candidates, while complying with our contractual obligations to contractors and other third parties;

• improving our operational, financial and management controls, reporting systems and procedures.

Our ability to continue to develop and, if approved, commercialize our product candidates will depend, in part, on our ability to effectively manage any future growth.

Our management may also have to divert a disproportionate

amount of its attention away from day-to-day activities in order to devote a substantial amount of time to managing these growth activities.

Our management may also have to divert a disproportionate amount of its attention away from day-to-day activities in order to devote a substantial amount of time to managing these growth activities.

We currently rely, and for the foreseeable future will continue to rely, in substantial part on certain independent organizations, advisors and consultants to provide certain services, including contract manufacturers and companies focused on research and development and discovery activities.

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There can be no assurance that we will be able to manage our existing consultants or find other competent outside contractors and consultants on economically reasonable terms, or at all.

If we are not able to effectively expand our organization by hiring new employees and expanding our groups of consultants and contractors, we may not be able to successfully implement the tasks necessary to further develop and commercialize PLN-74809 or any other product candidates and, accordingly, may not achieve our research, development and commercialization goals.

If we are not able to effectively expand our organization by hiring new employees and expanding our groups of consultants and contractors, we may not be able to successfully implement the tasks necessary to further develop and commercialize bexotegrast or any other product candidates and, accordingly, may not achieve our research, development and commercialization goals.

We may acquire additional technology and complementary businesses in the future.

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Despite our efforts to retain valuable employees, members of our management, scientific and development teams may terminate their employment with us on short notice.

Our key employees are at-will employees, which means that any of our employees could leave our employment at any time, with or without notice.

Our key employees are at-will employees, which means that any of our employees could leave our employment at any time, with or

without notice.

We do not maintain “key person” insurance policies on the lives of these individuals or the lives of any of our other employees.

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Our current operations are located in our facilities in South San Francisco, California.

Any unplanned event, such as flood, fire, explosion, earthquake, extreme weather condition, medical epidemics, power shortage, telecommunication failure or other natural or manmade accidents or incidents that result in us being unable to fully utilize our facilities, or the manufacturing facilities of our third-party contract manufacturers, may have a material and adverse effect on our ability to operate our business, particularly on a daily basis, and have significant negative consequences on our financial and operating conditions.

Any unplanned event, such as flood, fire, explosion, earthquake, extreme weather condition, medical epidemics, power shortage, telecommunication failure or other natural or man-made accidents or incidents that result in us being unable to fully utilize our facilities, or the manufacturing facilities of our third-party contract manufacturers, may have a material and adverse effect on our ability to operate our business, particularly on a daily basis, and have significant negative consequences on our financial and operating conditions.

Loss of access to these facilities may result in increased costs, delays in the development of our product candidates or interruption of our business operations.

Earthquakes or other natural disasters

could further disrupt our operations and have a material and adverse effect on our business, financial condition, results of operations and prospects.

Earthquakes or other natural disasters could further disrupt our operations and have a material and adverse effect on our business, financial condition, results of operations and prospects.

In addition, global climate change could result in certain types of natural disasters occurring more frequently or with more intense effects.

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We use and generate materials that may expose us to material liability.

Our research programs involve the use of hazardous materials and chemicals, which are currently only handled by third parties.

We are subject to foreign, federal, state, and local environmental and health and safety laws and regulations governing, among other matters, the use, manufacture, handling, storage and disposal of hazardous materials and waste products such as human tissue samples that may have the potential to transmit diseases.

Our research programs involve the use of hazardous materials and chemicals, which are generally handled by third parties.

products such as human tissue samples that may have the potential to transmit diseases.

We may incur significant costs to comply with these current or future environmental and health and safety laws and regulations.

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We generally contract with third parties for the disposal of these materials and wastes.

We cannot eliminate the risk of contamination or injury from these materials, which could cause an interruption of our commercialization efforts,

research and development efforts and business operations, environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products.

We cannot eliminate the risk of contamination or injury from these materials, which could cause an interruption of our commercialization efforts, research and development efforts and business operations, environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products.

Although we believe that the safety procedures utilized by our third-party manufacturers for handling and disposing of these materials generally comply with the standards prescribed by these laws and regulations, we cannot guarantee that this is the case or eliminate the risk of accidental contamination or injury from these materials.

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Any such limitation may significantly reduce our ability to utilize our net operating loss carryforwards and tax credit carryforwards before they expire.

We completed a Section 382 study of transactions in our stock ownership through December 31, 2021 and concluded that we have experienced ownership changes since inception and our utilization of pre-change net operating loss and credit carryforwards will be subject to the limitation.

We have performed an analysis under Internal Revenue Code Sections 382 and 383 to determine the amount of our net operating loss carryforwards and research and development credit carryforwards that will be subject to annual limitation.

This analysis concluded that we have experienced one or more such ownership changes prior to December 31, 2022, and the Company’s

net operating losses and tax credit carryforwards generated prior to the identified ownership changes are subject to no permanent limitation under Sections 382 or 383.

In addition, we may experience subsequent ownership changes as a result of future equity offerings or other changes in our stock ownership.

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Risks Related to Our Common Stock

An active or liquid market for our common stock may not be sustained.

Prior to our initial public offering in June 2020, there was no public market for shares of our common stock.

In connection with our initial public offering, our common stock was listed for trading on the Nasdaq Global Select Market.

However, an active or liquid market in our common stock may not be sustained.

Further, an inactive market may also impair our ability to raise capital by selling shares of our common stock and may impair our ability to enter into strategic collaborations or acquire companies or products by using our shares of common stock as consideration.

The price of our stock may be volatile, and you could lose all or part of your investment.

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In addition to the factors discussed in this “Risk Factors” section and elsewhere in this Report, these factors include:

• the commencement, enrollment or results of our current Phase 2a clinical trials of PLN-74809 and any other clinical trials for our product candidates conducted by us or our collaborators;

• the commencement, enrollment or results of our current Phase 2a clinical trials of bexotegrast and any other clinical trials for our product candidates conducted by us or our collaborators;

• any delay in identifying and advancing a clinical candidate for our other development programs;

• any delay in our regulatory filings for PLN-74809 or our other product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory authority’s review of such filings, including without limitation the FDA’s issuance of a “refusal to file” letter or a request for additional information;

• any delay in our regulatory filings for bexotegrast or our other product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory authority’s review of such filings, including without limitation the FDA’s issuance of a “refusal to file” letter or a request for additional information;

• adverse results or delays in future clinical trials;

• our decision to initiate a clinical trial, not to initiate a clinical trial or to terminate an existing clinical trial;

• adverse regulatory decisions, including failure to receive regulatory approval of PLN-74809 or any other product candidate;

• changes in laws or regulations applicable to PLN-74809 or any other product candidate, including but not limited to clinical trial requirements for approvals;

• adverse regulatory decisions, including failure to receive regulatory approval of bexotegrast or any other product candidate;

• changes in laws or regulations applicable to bexotegrast or any other product candidate, including but not limited to clinical trial requirements for approvals;

• adverse developments concerning our manufacturers;

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• additions or departures of key scientific or management personnel;

• unanticipated serious safety concerns related to the use of PLN-74809 or any other product candidate;

• unanticipated serious safety concerns related to the use of bexotegrast or any other product candidate;

• introduction of new products or services offered by us or our competitors;

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• other events or factors, many of which are beyond our control.

In addition, the stock market in general, and the market for biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies, including as a result of the COVID-19 pandemic.

Broad market and industry factors may negatively affect the market price of our common stock, regardless of our actual operating performance.

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Our executive officers, directors and their affiliates and our principal stockholders own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval.

Based on shares outstanding as of December 31, 2021, our executive officers, directors and their affiliates and our principal stockholders beneficially held, in the aggregate, approximately a quarter of our outstanding voting stock.

These stockholders, acting together, would be able to significantly influence all matters requiring stockholder approval.

Our executive officers, directors and our principal stockholders beneficially hold a significant portion of our voting stock.

These stockholders, acting together, may be able to significantly influence matters requiring stockholder approval.

For example, these stockholders would be able to significantly influence elections of directors, amendments of our organizational documents, or approval of any merger, sale of assets, or other major corporate transaction.

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If these additional shares of common stock are sold, or if it is perceived that they will be sold, in the public market, the trading price of our common stock could decline.

Additionally, the number of shares of our common stock reserved for issuance under our 2020 Stock Option and Incentive Plan will automatically increase on January 1 of each year by 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors or compensation committee.

Moreover, the number of shares of our common

stock reserved for issuance under our 2020 Employee Stock Purchase Plan, or ESPP, will automatically increase on January 1 of each year by the lesser of 700,000 shares of common stock, 1% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors or compensation committee.

Additionally, the number of shares of our common stock reserved for issuance under our 2020 Stock Option and Incentive Plan will automatically increase on January 1 of each year by 5% of the total

number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors or compensation committee.

Moreover, the number of shares of our common stock reserved for issuance under our 2020 Employee Stock Purchase Plan, or ESPP, will automatically increase on January 1 of each year by the lesser of 700,000 shares of common stock, 1% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors or compensation committee.

Unless our board of directors elects not to increase the number of shares available for future grant each year, our stockholders may experience additional dilution.

The holders of over 20 million shares of our common stock are entitled to rights with respect to the registration of their shares under the Securities Act of 1933, as amended, or the Securities Act, as provided under the terms of an investors’ rights agreement between us and certain of our stockholders.

Registration of these shares under the Securities Act would result in the shares becoming freely tradable without restriction under the Securities Act, except for shares held by affiliates, as defined in Rule 144 under the Securities Act.

Any sales of securities by these stockholders, or the perception that such sales could occur, could have a material adverse effect on the trading price of our common stock.

Anti-takeover provisions under our charter documents and Delaware law could delay or prevent a change of control which could limit the market price of our common stock and may prevent or frustrate attempts by our stockholders to replace or remove our current management.

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These anti-takeover provisions and other provisions in our certificate of incorporation and bylaws could make it more difficult for stockholders or potential acquirers to obtain control of our board of directors or initiate actions that are opposed by the then-current board of directors and could also delay or impede a merger, tender offer or proxy contest involving our company.

These provisions could also discourage proxy contests and make it more difficult for you and other stockholders to elect directors of your choosing or cause us to take other corporate actions you desire.

These provisions could also discourage proxy contests and make it more difficult for stockholders to elect directors of their choosing or cause us to take other corporate actions our stockholders desire.

Any delay or prevention of a change of control transaction or changes in our board of directors could cause the market price of our common stock to decline.

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(iii) any action asserting a claim against us arising pursuant to any provision of the DGCL, our certificate of incorporation or our bylaws;

(iv) any action to interpret, apply, enforce or determine the validity of our certificate of incorporation or bylaws;

action to interpret, apply, enforce or determine the validity of our certificate of incorporation or bylaws;

or (v) any action asserting a claim governed by the internal affairs doctrine, in each case subject to the Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein, or the Delaware forum provision.

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Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

We are required to disclose changes made in our internal controls and procedures on a quarterly basis and our management is required to assess the effectiveness of these controls annually.

However, for as long as we are “non-accelerated filer,” as defined by the SEC, our independent registered public accounting firm is not required to attest to the effectiveness of our internal controls over financial reporting pursuant to Section 404.

An independent assessment of the effectiveness of our internal controls over financial reporting could detect problems that our management’s assessment might not.

Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud.

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We expect to continue to grant equity awards to employees, directors, and consultants under our stock incentive plans.

We may also raise capital through equity financings in the future, including an "at-the-market" offering pursuant to our Controlled Equity Offering SM Sales Agreement with Cantor Fitzgerald & Co.

In July 2022 and January 2023, we completed underwritten public offerings of our common stock.

In July 2021, we entered into a Controlled Equity Offering SM Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co., as sales agent, pursuant to which we may issue and sell up to $150.0 million of shares of common stock from time to time.

On July 2, 2021, we filed a registration statement on Form S-3 (File No.

333-257684), as amended, which included a sales agreement prospectus registering the offer and sale of shares under the Sales Agreement (the “Sales Agreement Prospectus”).

From July 2, 2021 to January 23, 2023, no shares of common stock were sold pursuant to the Sales Agreement or the Sales Agreement Prospectus.

We terminated the Sales Agreement Prospectus on January 23, 2023 in connection with our January 2023 public offering, but the Sales Agreement remains in full force and effect.

We will not make any sales of shares of our common stock pursuant to the Sales Agreement unless and until a new sales agreement prospectus or prospectus supplement is filed, which we may do at a later date.

As part of our business strategy, we may acquire or make investments in complementary companies, products or technologies and issue equity securities to pay for any such acquisition or investment.

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Stockholder activism, the current political environment and the current high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to additional compliance costs and impact the manner in which we operate our business in ways we cannot currently anticipate.

We expect the rules and regulations applicable to public companies to substantially increase our legal and financial compliance costs and to make some activities more time-consuming and costly, particularly as we ceased to be an emerging growth company on December 31, 2021.

We expect the rules and regulations applicable to public companies to substantially increase our legal and financial compliance costs and to make some activities more time-consuming and costly.

If these requirements divert the attention of our management and personnel from other business concerns, they could have an adverse effect on our business.

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Implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future, which may create uncertainty in our business, affect our or our service providers’ ability to operate in certain jurisdictions or to collect, store, transfer use and share personal data, result in liability or impose additional compliance or other costs on us.

Any failure or perceived failure by us to comply with

federal, state, or foreign laws or self-regulatory standards could result in negative publicity, diversion of management time and effort and proceedings against us by governmental entities or others.

Any failure or perceived failure by us to comply with federal, state, or foreign laws or self-regulatory standards could result in negative publicity, diversion of management time and effort and proceedings against us by governmental entities or others.

Numerous federal and state laws and regulations, including HIPAA and HITECH, govern the collection, dissemination, security, use and confidentiality of patient-identifiable health information or personal information.

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HIPAA enforcement actions may lead to monetary penalties and costly and burdensome corrective action plans.

Additionally, on December 10, 2020, OCR issued a proposed rule aimed at strengthening individuals’ rights to access their own health information, as well as reducing administrative burdens on HIPAA covered health care providers and health plans, among other changes.

While a final rule has not yet been issued, if adopted, these proposed changes may require us to update our HIPAA policies and procedures to comply with the new requirements.

California passed the California Consumer Protection Act of 2018, or the CCPA, which went into effect in January 2020 and provides new data privacy rights for consumers and new operational requirements for companies, which may increase our compliance costs and potential liability.

California passed the California Consumer Protection Act of 2018, or the CCPA, which went into effect in January 2020 and provides data privacy rights for consumers and new operational requirements for companies, which may increase our compliance costs and potential liability.

The CCPA gives California residents expanded rights to access and delete their personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used.

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While there is currently an exception for protected health information that is subject to HIPAA and clinical trial regulations, as currently written, the CCPA may impact certain of our business activities.

How this HIPAA exception is enforced and interpreted may also impact our business activities.

Additionally, this exception does not apply to the private cause of action afforded to individuals for information security incidents.

In addition, the CCPA will be expanded on January 1, 2023, when the California Privacy Rights Act of 2020, or the CPRA, becomes operative.

The CPRA will, among other things, give California residents the ability to limit use of certain sensitive personal information, further restrict the use of cross-contextual advertising, establish restrictions on the retention of personal information, expand the types of data breaches subject to the CCPA’s private right of action, provide for increased penalties for CPRA violations concerning California residents under the age of 16, and establish a new California Privacy Protection Agency to implement and enforce the new law.

In addition, the CCPA was expanded on January 1, 2023, when the California Privacy Rights Act of 2020, or the CPRA, became operative.

The CPRA, among other things, gives California residents the ability to limit use of certain sensitive personal information, further restricts the use of cross-contextual advertising, establishes restrictions on the retention of personal information, expands the types of data breaches subject to the CCPA’s private right of action, provides for increased penalties for CPRA violations concerning California residents under the age of 16, and establishes a new California Privacy Protection Agency to implement and enforce the new law.

Although there are limited exemptions for clinical trial data under the CCPA, the CCPA and other similar laws could impact our business activities depending on how it is interpreted.

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The CCPA and CPRA could mark the beginning of a trend toward more stringent privacy legislation in the United States, as other states or the federal government may follow California’s lead and increase protections for U.S.

For example, on March 2, 2021, the Virginia Consumer Data Protection Act, which will take effect on January 1, 2023, was signed into law and on July 8, 2021, the Colorado Privacy Act, which will take effect on July 1, 2023, was signed into law.

For example, on March 2, 2021, the Virginia Consumer Data Protection Act was signed into law, which went into effect on January 1, 2023, and on July 8, 2021, the Colorado Privacy Act, was signed into law, which will take effect on July 1, 2023, was signed into law.

On September 18, 2021, the Uniform Law Commission published the Uniform Personal Data Protection Act, which states may begin to adopt.

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Additionally, the Federal Trade Commission (FTC) and many state attorneys general are interpreting existing federal and state consumer protection laws to impose evolving standards for the collection, use, dissemination and security of health-related and other personal information.

Courts may also adopt the standards for fair information practices

promulgated by the FTC, which concern consumer notice, choice, security and access.

Courts may also adopt the standards for fair information practices promulgated by the FTC, which concern consumer notice, choice, security and access.

Consumer protection laws require us to publish statements that describe how we handle personal information and choices individuals may have about the way we handle their personal information.

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Furthermore, according to the FTC, 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 of the FTC Act.

Additionally, the FTC recently published an advance notice of proposed rulemaking on commercial surveillance and data security, and is seeking comment on whether it should implement new trade regulation rules or other regulatory alternatives concerning the ways in which companies (1) collect, aggregate, protect, use, analyze, and retain consumer data, as well as (2) transfer, share, sell, or otherwise monetize that data in ways that are unfair or deceptive.

Our business relies on secure and continuous processing of information and the availability of our Information Technology (IT) networks and IT resources, as well as critical IT vendors that support our technology and data processing operations.

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

OCR, in partnership with the Healthcare and Public Health Sector Coordinating Council, recently issued cybersecurity guidelines for healthcare organizations that reflect consensus-based, voluntary practices to cost-effectively reduce cybersecurity risks for organizations of varying sizes.

Although these HHS-backed guidelines, entitled “Health Industry Cybersecurity Practices:

Managing Threats and Protecting Patients,” are voluntary, they are likely to serve as an important reference point for the healthcare industry, and may cause us to invest additional resources in technology, personnel and programmatic cybersecurity controls as the cybersecurity risks we face continue to evolve.

OCR, pursuant to legislation passed in 2021, recently issued guidance on recognized security practices for covered entities and business associates.

OCR indicated that recognized security practices will not be an aggravating factor in OCR investigations, but that implementation of recognized security practices strengthen an organization’s cybersecurity and regulatory posture, as well as possibly lessening enforcement penalties in a potential regulatory enforcement

We regularly monitor, defend against and respond to attacks to our networks and other information security incidents.

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In addition to our operations in the United States, which may be subject to healthcare and other laws relating to the privacy and security of health information and other personal data, we may seek to conduct clinical trials in the EEA and may become subject to additional EEA data privacy laws, regulations and guidelines.

The General Data Protection Regulation, (EU) 2016/679, or EU GDPR, became effective on May 25, 2018, and deals with the collection, use, storage, disclosure, transfer or other processing of personal data, including personal health data, regarding individuals in the EEA.

The General Data Protection Regulation, or EU GDPR, became effective on May 25, 2018, and deals with the collection, use, storage, disclosure, transfer or other processing of personal data, including personal health data, regarding individuals in the EEA.

The EU GDPR imposes a broad range of strict requirements on companies subject to the EU GDPR, including requirements relating to having legal bases for processing personal data (i.e., data relating to identifiable individuals) and transferring such personal data outside the EEA, including to the United States, and providing details to those individuals regarding the processing of their personal data, keeping personal data secure, having data processing agreements with third parties who process personal data on our behalf, responding to individuals’ requests to exercise their rights in respect of their personal data, reporting security breaches involving personal data to the competent national data protection authority and affected individuals, appointing data protection officers, conducting data protection impact assessments and record-keeping.

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If our efforts to comply with EU GDPR or other applicable EU laws and regulations are not successful, or are perceived to be unsuccessful, it could adversely affect our business in the EU.

The EU GDPR also prohibits the transfer of personal data from the EEA to the United States and most other countries that are not recognized as having “adequate” data protection laws by the European Commission unless the parties to the transfer have implemented specific safeguards to protect the transferred personal data.

One of the primary safeguards

allowing U.S.

The EU GDPR also prohibits the transfer of personal data from the EEA to the United States and other countries that are not recognized as having “adequate” data protection laws by the European Commission unless the parties to the transfer have implemented specific safeguards to protect the transferred personal data.

One of the primary safeguards allowing U.S.

companies to import personal data from the EEA has been certification to the EU-U.S.

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Privacy Shield has not been officially invalidated).

Further, the European Commission recently published new EU SCCs, which place onerous obligations on the contracting parties.

At present, there are few, if any, viable alternatives to the SCCs.

These developments could restrict our activities in the EEA/Switzerland, limit our ability to provide our products and services in the EEA/Switzerland, and/or increase our costs and obligations and impose limitations upon our ability to efficiently transfer personal data from the EEA/Switzerland to the United States.

Further, the European Commission published new EU SCCs in June 2021, which place onerous obligations on the contracting parties.

Therefore, until recently, there were few, if any, viable alternatives to the SCCs.

However, on October 7, 2022, President Biden introduced an Executive Order to facilitate a new Trans-Atlantic Data Privacy Framework which will act as a successor to the invalidated EU-U.S.

Privacy Shield.

If approved by the European Commission and implemented, the agreement will facilitate the transatlantic flow of personal data and provide an alternative data transfer mechanism (in addition to SCCs) for companies transferring personal data from the EU to the U.S.

However, before entities rely on the new EU-U.S.

Privacy Shield, there are still legislative and regulatory steps that must be undertaken both in the U.S.

and in the EU.

Therefore, at present, the new EU SCCs are still the primary safeguard available for personal data transfers from the EU to the U.S.

As such, the current legal position could restrict our activities in the EEA/Switzerland, limit our ability to provide our products and services in the EEA/Switzerland, and/or increase our costs and obligations and impose limitations upon our ability to efficiently transfer personal data from the EEA/Switzerland to the United States.

Following the U.K.’s departure from the EU (Brexit), the EU GDPR’s data protection obligations continue to apply to the UK in substantially unvaried form under the so-called “UK GDPR”.

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As a result, we are potentially exposed to two parallel data protection regimes, each of which authorizes fines and the potential for divergent enforcement actions.

It should be noted that the UK GDPR also prohibits the transfer of personal data from the UK to other countries that are not recognized as having “adequate” data protection laws, including the U.S., in a similar manner to the EU.

In addition, the UK Government has published its own form of SCCs, known as the International Data Transfer Agreement and International Data Transfer Addendum to the new EU SCCs.

The UK Information Commissioner’s Office has also published its version of the transfer impact assessment and revised guidance on international transfers, although companies may choose to either use the EU style or UK style transfer impact assessment.

In terms of international data transfers between the UK and US, it is understood that the UK and the US are negotiating an adequacy agreement.

In the event we commence clinical trials in the EEA, the UK or Switzerland, applicable data protection laws may increase our responsibility and liability in relation to personal data that we process, and we may be required to put in place additional mechanisms and safeguards to ensure compliance, including as implemented by individual countries.

Compliance with data protection laws in the EEA, the UK and Switzerland will be a rigorous and time-intensive process that may increase our cost of doing business or require us to change our business practices, and despite those efforts, there is a risk that we may be subject to fines and penalties, litigation and reputational harm in connection with our European activities.

Compliance with data protection laws in the EEA, the UK and Switzerland is a rigorous and time-intensive process that may increase our cost of doing business or require us to change our business practices, and despite those efforts, there is a risk that we may be subject to fines and penalties, litigation and reputational harm in connection with our European activities.

We expect that we will continue to face uncertainty as to whether our efforts to comply with any obligations under European privacy laws will be sufficient.

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legislation may depart from EU legislation.

For instance, now the transition period

has expired, Great Britain will no longer be covered by the centralized procedure for obtaining an EEA-wide marketing authorization from the European Medicines Agency, or EMA, and a separate process for authorization of drug products, including our product candidates and products in the U.K., will be required in Great Britain resulting in an authorization covering the UK or Great Britain only.

For instance, now the transition period has expired, Great Britain will no longer be covered by the centralized procedure for obtaining an EEA-wide marketing authorization from the European Medicines Agency, or EMA, and a separate process , will be required for authorization of drug products covering the UK or Great Britain only.

Any delay in obtaining, or an inability to obtain, any regulatory approvals, as a result of Brexit or otherwise, would prevent us from commercializing our product candidates in the U.K.

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The UK government is currently trying to renegotiate fundamental aspects of the Northern Ireland Protocol so this is an unpredictable area for companies in the near future.

Failed attempts to renegotiate the Northern Ireland Protocol have led to media reports of the UK potentially triggering Article 16 of the Northern Ireland Protocol, a safeguarding measure, that may be engaged unilaterally if the application of the Protocol leads to serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade.

The TCA allows for future deviation from the current regulatory framework and it is not known if and/or when any deviations may occur, which may have an impact on development, manufacture, marketing authorization, commercial sales and distribution of pharmaceutical products.

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We exercise little or no direct control over how these third parties operate their networks, which increases our vulnerability to problems with their systems.

While we have not experienced any such material system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a disruption of our development programs and our business operations, whether due to a loss of our trade secrets or other proprietary information or other similar disruptions.

While we have not experienced any such material system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our information systems, it could result in a disruption of our development programs and our business operations, whether due to a loss of our trade secrets or other proprietary information or other similar disruptions.

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

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We could be subject to risks caused by misappropriation, misuse, leakage, falsification or intentional or accidental release, exposure or loss of information maintained in the information systems and networks of our company and our vendors, including personal information of our employees and study subjects, and company and vendor confidential data.

In addition, outside parties may attempt to penetrate our systems or those of our vendors or fraudulently induce our personnel or the personnel of our vendors to disclose sensitive information in order to gain access to our data and/or systems.

In addition, outside parties may attempt to penetrate our systems or those of our vendors or fraudulently

induce our personnel or the personnel of our vendors to disclose sensitive information in order to gain access to our data and/or systems.

We may experience threats to our data and systems, including malicious code and viruses, supply chain attacks, phishing and other cyberattacks.

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Moreover, despite our efforts, the possibility of these events occurring cannot be eliminated entirely.

As we outsource more of our information systems to vendors, engage in more electronic transactions with payors

and patients, and rely more on cloud- based information systems, the related security risks will increase and we will need to expend additional resources to protect our technology and information systems.

As we outsource more of our information systems to vendors, engage in more electronic transactions with payors and patients, and rely more on cloud- based information systems, the related security risks will increase and we will need to expend additional resources to protect our technology and information systems.

In addition, there can be no assurance that our internal information technology systems or those of our third- party contractors, or our consultants’ efforts to implement adequate security and control measures, will be sufficient to protect us against breakdowns, service disruption, data deterioration or loss in the event of a system malfunction, or prevent data from being stolen or corrupted in the event of a cyberattack, security breach, industrial espionage attacks or insider threat attacks which could result in financial, legal, business or reputational harm.

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Furthermore, the most recent global financial crisis caused extreme volatility and disruptions in the capital and credit markets.

A severe or prolonged economic downturn, including due to the impact of the COVID-19 pandemic, and rising interest rates could result in a variety of risks to our business, including a reduced ability to raise additional capital when needed on acceptable terms, if at all.

A severe or prolonged economic downturn, including due to the impact of the COVID-19 pandemic, Russian invasion of Ukraine, rising inflationary pressures and rising interest rates could result in a variety of risks to our business, including a reduced ability to raise additional capital when needed on acceptable terms, if at all.

A weak or declining economy or international trade disputes could also strain our suppliers, some of which are located outside of the United States, possibly resulting in supply disruption.

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When such disclosures occur, there is a risk that trial enrollment may be adversely impacted, that we may fail to monitor and comply with applicable adverse event reporting obligations or that we may not be able to defend our business or the public’s legitimate interests in the face of the political and market pressures generated by social media due to restrictions on what we may say about our product candidates.

There is also a risk of inappropriate disclosure of sensitive information or negative or inaccurate posts or comments about us on any social networking website.

There is also a risk of inappropriate disclosure of sensitive information or negative or inaccurate posts or

comments about us on any social networking website.

If any of these events were to occur or we otherwise fail to comply with applicable regulations, we could incur liability, face regulatory actions or incur other harm to our business.

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Unresolved Staff Comments

Not Applicable.

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

What changed 10-K

Item 1A. Risk Factors