What changed in this filing

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Item 1A. Risk Factors

2021-03-01 compared with 2020-03-16 · 191 added, 180 removed, 956 unchanged (28% of the section changed)

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Drug development is a highly uncertain undertaking and involves a substantial degree of risk.

We have recently initiated clinical trials for our lead drug candidate, COR388, and have not initiated clinical trials for any of our other drug candidates.

We have recently initiated clinical trials for our lead drug candidate, atuzaginstat, and have not initiated clinical trials for any of our other drug candidates.

To date, we have not initiated or completed a pivotal clinical trial, obtained marketing approval for any drug candidate, manufactured a commercial scale drug candidate, arranged for a third party to do so on our behalf, or conducted sales and marketing activities necessary for successful drug candidate commercialization.

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We have incurred net losses in each year since our inception.

For the years ended December 31, 2019 and 2018, our net losses were $37.0 million and $12.5 million, respectively.

For the years ended December 31, 2020, 2019 and 2018, our net losses were $76.8 million, $37.0 million and $12.5 million, respectively.

We had an accumulated deficit of $146.7 million as of December 31, 2020.

To date, we have devoted most of our financial resources to our corporate overhead and research and development of COR388, including our preclinical development activities and clinical trials of COR388.

To date, we have devoted most of our financial resources to our corporate overhead and research and development of atuzaginstat, including our preclinical development activities and clinical trials of atuzaginstat.

We expect that it will be several years, if ever, before we have a drug candidate ready for commercialization.

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If we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis and we will continue to incur substantial research and development and other expenditures to develop and market additional drug candidates.

We will require substantial additional funding to finance our operations, complete the development and commercialization of COR388 and evaluate future drug candidates.

We will require substantial additional funding to finance our operations, complete the development and commercialization of atuzaginstat and evaluate future drug candidates.

If we are unable to raise this funding when needed, we may be forced to delay, reduce or eliminate our drug development programs or other operations.

Since our inception, we have used substantial amounts of cash to fund our operations, and we expect our expenses to increase substantially in the foreseeable future in connection with our ongoing activities, particularly as we continue the research and development of, initiate clinical trials of, and seek marketing approval for, COR388.

Developing COR388 and conducting clinical trials for the treatment of Alzheimer’s disease and any other indications that we may pursue in the future will require substantial amounts of capital.

In addition, if we obtain marketing approval for COR388 or any future drug candidates, we expect to incur significant commercialization expenses related to sales, marketing, manufacturing and distribution.

Accordingly, we will need to obtain substantial additional funding in connection wit h our continuing operations.

Developing atuzaginstat and conducting clinical trials for the treatment of Alzheimer’s disease, early Parkinson’s disease and any other indications that we may pursue in the future will require substantial amounts of capital.

In addition, if we obtain marketing approval for atuzaginstat or any future drug candidates, we expect to incur significant commercialization expenses related to sales, marketing, manufacturing and distribution.

Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations.

As of December 31, 2020, we had $184.3 million in cash, cash equivalents and investments.

In February 2020, we also received net proceeds of approximately $117.6 million from the issuance and sale of common stock in a private p lacement to certain accredited investors .

We believe that our existing capital resources will be sufficient to fund our projected operations through at least 2023.

However, changing circumstances may cause us to increase our spending significantly faster than we currently anticipate, and we may need to spend more money than currently expected because of circumstances beyond our control.

We may need to raise additional funds sooner than we anticipate if we choose to expand more rapidly than we presently ant icipate.

We may need to raise additional funds sooner than we anticipate if we choose to expand more rapidly than we presently anticipate.

The amount and timing of our future funding requirements will depend on many factors, some of which are outside of our control, including but not limited to:

the progress, costs, trial design, results of and timing of our Phase 2/3 GAIN trial and other clinical trials of COR388, including for potential additional indications that we may pursue beyond Alzheimer’s disease;

the progress, costs, trial design, results of and timing of our Phase 2/3 GAIN trial and other clinical trials of atuzaginstat, including our Phase 2 PEAK trial for Parkinson’s disease and for potential additional indications that we may pursue beyond Alzheimer’s and Parkinson’s disease;

the willingness of the U.S.

Food and Drug Administration, or FDA, and European Medicines Agency, or EMA, to accept our GAIN trial, as well as data from our completed and planned clinical and preclinical studies and other work, as the basis for review and approval of COR388 for Alzheimer’s disease;

Food and Drug Administration, or FDA, and European Medicines Agency, or EMA, to accept our GAIN trial and our PEAK trial, as well as data from our completed and planned clinical and preclinical studies and other work, as the basis for review and approval of atuzaginstat for Alzheimer’s and Parkinson’s disease;

the outcome, costs and timing of seeking and obtaining FDA, EMA and any other regulatory approvals;

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We also could be required to seek funds through arrangements with collaborative partners or otherwise that may require us to relinquish rights to some of our technologies or drug candidates or otherwise agree to terms unfavorable to us.

Additionally, while the potential global economic impact and the duration of the COVID-19 pandemic may be difficult to assess or predict, a widespread pandemic could result in significant long-term disruption of global financial markets, which could in the future reduce our ability to access capital and negatively affect our liquidity.

In addition, the trading prices for our common stock and other biopharmaceutical companies, as well as the broader equity and debt markets, have been highly volatile as a result of the COVID-19 pandemic and the resulting impact on economic activity.

Furthermore, a recession or decline in market value resulting from the spread of COVID-19 could materially affect our operations, overall yields from our investment portfolio, including through impairment and loss of investment, and the value of our common stock.

Risks Related to Our Business and the Development of Our Drug Candidates

We are substantially dependent on the success of COR388, which will require significant additional clinical testing before we can seek regulatory approval and potentially launch commercial sales, and which may not be successful in clinical trials, receive regulatory approval or be successfully commercialized, even if approved.

To date, we have invested substantially all of our efforts and financial resources in the research and development of COR388, which is currently our only drug candidate.

Before seeking marketing approval from regulatory authorities for the sale of COR388, we must conduct extensive clinical trials to demonstrate the safety and efficacy of the drug in humans.

We are substantially dependent on the success of atuzaginstat, which will require significant additional clinical testing before we can seek regulatory approval and potentially launch commercial sales, and which may not be successful in clinical trials, receive regulatory approval or be successfully commercialized, even if approved.

To date, we have invested substantially all of our efforts and financial resources in the research and development of atuzaginstat, which is currently our only drug candidate.

Before seeking marketing approval from regulatory authorities for the sale of atuzaginstat, we must conduct extensive clinical trials to demonstrate the safety and efficacy of the drug in humans.

We are not permitted to market or promote any of our drug candidates before we receive regulatory approval from the FDA, or comparable foreign regulatory authorities, and we may never receive such regulatory approval.

We cannot be certain that COR388 will be successful in clinical trials.

Further, COR388 may not receive regulatory approval even if it is successful in clinical trials.

If we do not receive regulatory approvals for COR388, we may not be able to continue our operations.

Our prospects, including our ability to finance our operations and generate revenue, will depend entirely on the successful development, regulatory approval and commercialization of COR388.

The clinical and commercial success of COR388 will depend on a number of factors, including the following:

the results from our Phase 2/3 GAIN trial, as well as other clinical trials of COR388;

the frequency and severity of adverse effects of COR388;

the ability of third-party manufacturers to manufacture supplies of COR388 and to develop, validate and maintain a commercial-scale manufacturing process that is compliant with current good manufacturing practices, or cGMP;

our ability to demonstrate COR388’s safety and efficacy to the satisfaction of the FDA and foreign regulatory authorities;

whether we are required by the FDA to conduct additional clinical trials prior to the approval to market COR388 and whether the FDA may disagree with the number, design, size, conduct or implementation of our clinical trials;

We cannot be certain that atuzaginstat will be successful in clinical trials.

Further, atuzaginstat may not receive regulatory approval even if it is successful in clinical trials.

If we do not receive regulatory approvals for atuzaginstat, we may not be able to continue our operations.

Our prospects, including our ability to finance our operations and generate revenue, will depend entirely on the successful development, regulatory approval and commercialization of atuzaginstat.

The clinical and commercial success of atuzaginstat will depend on a number of factors, including the following:

the results from our Phase 2/3 GAIN trial, as well as other clinical trials of atuzaginstat, including our Phase 2 PEAK trial for Parkinson’s disease;

the frequency and severity of adverse effects of atuzaginstat;

the ability of third-party manufacturers to manufacture supplies of atuzaginstat and to develop, validate and maintain a commercial-scale manufacturing process that is compliant with current good manufacturing practices, or cGMP;

our ability to demonstrate atuzaginstat’s safety and efficacy to the satisfaction of the FDA and foreign regulatory authorities;

whether we are required by the FDA to conduct additional clinical trials prior to the approval to market atuzaginstat and whether the FDA may disagree with the number, design, size, conduct or implementation of our clinical trials;

the receipt of necessary marketing approvals from the FDA and foreign regulatory authorities;

whether the FDA may require implementation of a Risk Evaluation and Mitigation Strategy, or REMS, as a condition of approval or post-approval;

our ability to successfully commercialize COR388, if approved for marketing and sale by the FDA or foreign regulatory authorities, whether alone or in collaboration with others;

our success in educating physicians and patients about the benefits, administration and use of COR388;

acceptance of COR388 as safe and effective by patients and the medical community;

our ability to successfully commercialize atuzaginstat, if approved for marketing and sale by the FDA or foreign regulatory authorities, whether alone or in collaboration with others;

our success in educating physicians and patients about the benefits, administration and use of atuzaginstat;

acceptance of atuzaginstat as safe and effective by patients and the medical community;

the availability, perceived advantages, relative cost, relative safety and relative efficacy of alternative and competing treatments;

achieving and maintaining compliance with all regulatory requirements applicable to COR388;

achieving and maintaining compliance with all regulatory requirements applicable to atuzaginstat;

the effectiveness of our own or any future collaborators’ marketing, pricing, coverage and reimbursement, sales and distribution strategies and operations;

our ability to maintain our existing patents and obtain newly issued patents that cover COR388 and to enforce such patents and other intellectual property rights in and to COR388;

our ability to maintain our existing patents and obtain newly issued patents that cover atuzaginstat and to enforce such patents and other intellectual property rights in and to atuzaginstat;

our ability to avoid third-party intellectual property claims;

a continued acceptable safety profile of COR388 following approval.

a continued acceptable safety profile of atuzaginstat following approval.

Many of these factors are beyond our control.

Accordingly, we cannot assure you that we will ever be able to generate revenue through the sale of COR388.

If we are not successful in commercializing COR388, or are significantly delayed in doing so, our business will be materially harmed.

Accordingly, we cannot assure you that we will ever be able to generate revenue through the sale of atuzaginstat.

If we are not successful in commercializing atuzaginstat, or are significantly delayed in doing so, our business will be materially harmed.

Our approach to the potential treatment of the underlying cause of Alzheimer’s and other neurodegenerative diseases is based on a novel therapeutic approach, which exposes us to unforeseen risks.

We have discovered and are developing a proprietary library of protease inhibitors from which we have selected our lead drug candidate, COR388, which is under development to treat Alzheimer’s disease and other degenerative diseases.

We have discovered and are developing a proprietary library of protease inhibitors from which we have selected our lead drug candidate, atuzaginstat, which is under development to treat Alzheimer’s disease and other degenerative diseases.

Our approach is based on the discovery of P.

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There is no current academic or general consensus on the causation of Alzheimer’s disease or method of action or current drugs that purport to treat Alzheimer’s disease.

Based on the results of our preclinical and clinical studies to date, we believe COR388 is neuroprotective and with potential to prevent further neurodegeneration, reduce amyloid beta levels and reduce inflammation, when administered orally.

Based on the results of our preclinical and

clinical studies to date, we believe atuzaginstat is neuroprotective and with potential to prevent further neurodegeneration, reduce amyloid beta levels and reduce inflammation, when administered orally.

However, these ideas and this approach are novel, and we currently have only limited data based on physiological mouse models of Alzheimer’s disease and our Phase 1 a/b clinical trials which enrolled 67 subjects, including nine patients with mild to moderate Alzheimer’s disease.

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We are not aware of any other brain-penetrating gingipain protease inhibitors being tested in humans.

We may ultimately discover that COR388, or any of our other protease inhibitors, do not possess certain properties required for therapeutic effectiveness.

We have no long-term evidence regarding the efficacy, safety and tolerability of COR388 or other compounds in our proprietary library of protease inhibitors in humans.

We may ultimately discover that atuzaginstat , or any of our other protease inhibitors, do not possess certain properties required for therapeutic effectiveness.

We have no long-term evidence regarding the efficacy, safety and tolerability of atuzaginstat or other compounds in our proprietary library of protease inhibitors in humans.

We may spend substantial funds attempting to develop these drug candidates and never succeed in doing so.

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Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain.

The results of preclinical studies and completed clinical trials are not necessarily predictive of future results, and our current drug candidate may not be further developed or have favorable results in later stu dies or trials.

Clinical trial failure may result from a multitude of factors including, but not limited to, flaws in study design, dose selection, placebo effect, patient enrollment criteria and failure to demonstrate favorable safety or efficacy traits.

As such, failure in clinical trials can occur at any stage of testing.

A number of companies in the pharmaceutical industry have suffered setbacks in the advancement of their drug candidates into later-stage clinical trials due to lack of efficacy or adver se safety profiles, notwithstanding results in earlier preclinical studies or clinical trials.

The Phase 1a and Phase 1b clinical trials for our lead drug candidate, COR388, included only nine Alzheimer’s patients and 58 healthy volunteers.

Further, the re sults of our earlier stage clinical trials and our preclinical animal studies may not be predictive of the results of outcomes in later-stage clinical studies.

For example, data from six Alzheimer’s patients treated with COR388 in our Phase 1b clinical tri al showed improvements across several exploratory cognitive tests.

A number of companies in the pharmaceutical industry have suffered setbacks in the advancement of their drug candidates into later-stage clinical trials due to lack of efficacy or adverse safety profiles, notwithstanding results in earlier preclinical studies or clinical trials.

The Phase 1a and Phase 1b clinical trials for our lead drug candidate, atuzaginstat, included only nine Alzheimer’s patients and 58 healthy volunteers.

Further, the results of our earlier stage clinical trials and our preclinical animal studies may not be predictive of the results of outcomes in later-stage clinical studies.

For example, data from six Alzheimer’s patients treated with atuzaginstat in our Phase 1b clinical trial showed improvements across several exploratory cognitive tests.

However, these improvements should be interpreted with caution because they were not all statistically significant.

When evaluated in a larger patient population, COR388 may not show simila r improvements toward cognitive effects or may demonstrate different chemical and pharmacological properties in patients in unforeseen or harmful ways.

When evaluated in a larger patient population, atuzaginstat may not show similar improvements toward cognitive effects or may demonstrate different chemical and pharmacological properties in patients in unforeseen or harmful ways.

Based upon negative or inconclusive results, we may decide, or regulatory authorities may require us, to conduct additional clinical trials or preclinical studies.

In addition, data obtained from preclinical trials and clinical trials are susceptible to varying interpretations, and regulatory authorities may not interpret our data as favorably as we do, whic h may further delay, limit or prevent development efforts, clinical trials or marketing approval.

In addition, data obtained from preclinical trials and clinical trials are susceptible to varying interpretations, and regulatory authorities may not interpret our data as favorably as we do, which may further delay, limit or prevent development efforts, clinical trials or marketing approval.

Furthermore, as more competing drug candidates within a particular class of drugs proceed through clinical development to regulatory review and approval, the amount and type of clinical data that may be required by regulatory authorities may increase or change.

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Moreover, if we are not able to differentiate our drug candidate against other approved drug candidates within the same class of drugs, or if any of the other circumstances described above occur, our business would be harmed and our ability to generate revenue from that class of drugs would be severely impaired.

Adverse side effects or properties or other safety risks associated with COR388 or any future drug candidates could delay or preclude approval, cause us to suspend or discontinue clinical trials, abandon further development, limit the commercial profile of an approved label, or result in significant negative consequences following marketing approval, if any.

As is the case with pharmaceuticals generally, it is possible that there may be side effects and adverse events associated with the use of COR388 or any future drug candidates.

COR388 was well-tolerated with no concerning safety signals in our Phase 1a and Phase 1b clinical trials.

Adverse side effects or properties or other safety risks associated with atuzaginstat or any future drug candidates could delay or preclude approval, cause us to suspend or discontinue clinical trials, abandon further development, limit the commercial profile of an approved label, or result in significant negative consequences following marketing approval, if any.

There may be side effects and adverse events associated with the use of atuzaginstat or any future drug candidates.

atuzaginstat was well-tolerated with no concerning safety signals in our Phase 1a and Phase 1b clinical trials.

While some subjects experienced minor changes in electrocardiograms, or ECGs, in particular transient increases in the QRS duration and PR interval, these changes were not clinically significant, which means they did not result in the need to consider changes to the treatment of the patient.

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There were no discernable trends in the QTcF interval in human or animal studies.

Relative to placebo, there were no patterns in laboratory abnormalities or changes in ECGs, vital signs or the results of physical examinations observed during these trials that would be deemed practically relevant to the treatment of the patient with COR388.

In addition, results of our Phase 2/3 GAIN trial, and future clinical trials, could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics as the clinical trials progress to longer exposures and a larger number of patients.

Undesirable side effects caused by, or unexpected or unacceptable characteristics associated with, COR388 or any future drug candidates could result in the delay, suspension or termination of clinical trials by us, the FDA or other regulatory authorities for a number of reasons.

We may also elect to limit their development to more narrow uses or subpopulations in which the undesirable side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective, which may limit the commercial expectations for such drug candidate if approved.

If we elect or are required to further delay, suspend or terminate any clinical trial of any drug candidates that we develop, the commercial prospects of such drug candidates will be harmed and our ability to generate drug revenues from any such drug candidates will be delayed or eliminated.

It is possible that, as we test COR388 in our Phase 2/3 GAIN trial or other trials, or as the use of COR388 becomes more widespread if it receives regulatory approval, we may identify additional adverse events that were not identified or not considered significant in our earlier trials.

Results from our preclinical testing and early clinical trials do not ensure that later clinical trials will provide adequate data to demonstrate the safety of atuzaginstat.

R esults of our Phase 2/3 GAIN trial, and future clinical trials, could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics as the clinical trials progress to longer exposures at varying dose levels and a larger number of patients.

Side effects could include treatment-related adverse events not seen in our Phase 1a and Phase 1b clinical trials of atuzaginstat including hepatic adverse events .

Undesirable side effects caused by, or unexpected or unacceptable characteristics associated with, atuzaginstat or any future drug candidates could result in the delay, suspension or termination of clinical trials by us, the FDA or other regulatory authorities for a number of reasons.

For example, on February 12, 2021, we received a letter from the FDA stating that a partial clinical hold has been placed on atuzaginstat impacting the OLE phase of the GAIN Trial.

The partial clinical hold was initiated following the review of hepatic adverse events in the atuzaginstat trial by the FDA.

Under the hold, we have stopped enrollment and dosing in the OLE phase of the GAIN Trial.

As we test the safety of atuzaginstat in our Phase 2/3 GAIN trial or other trials, or as the use of atuzaginstat becomes more widespread if it receives regulatory approval, we may identify additional adverse events that were not identified or not considered significant in our earlier trials.

If such side effects become later known in development or upon approval, if any, such findings may harm our business, financial condition, results of operations and prospects significantly.

If we or others later identify undesirable side effects, a number of potentially significant negative consequences could result, including:

regulatory authorities may withdraw, suspend or limit approval of COR388 or any future drug candidates;

regulatory authorities may withdraw, suspend or limit approval of atuzaginstat or any future drug candidates;

we may be required to recall a drug or change the way such drug is administered to patients;

regulatory authorities may require additional warnings or statements in the labeling, such as a boxed warning or a contraindication or issue safety alerts, press releases or other communications containing warnings or other safety information about the drug candidate, for example, field alerts to physicians and pharmacies;

regulatory authorities may require a medication guide outlining the risks of such side effects for distribution to patients, or that we impl ement a risk evaluation and mitigation strategy, or REMS, to ensure that the benefits of the drug outweigh its risks;

regulatory authorities may require a medication guide outlining the risks of such side effects for distribution to patients, or that we implement a risk evaluation and mitigation strategy, or REMS, to ensure that the benefits of the drug outweigh its risks;

we may be required to change the way a drug is distributed or administered, conduct additional clinical trials or change the labeling of a drug, or be required to conduct additional post-marketing studies or surveillance;

we could be sued and held liable for harm caused to patients;

sales of the drug may decrease significantly or COR388 or any future drug could become less competitive;

sales of the drug may decrease significantly or atuzaginstat or any future drug could become less competitive;

our reputation may suffer.

Any of these events could prevent us from achieving or maintaining market acceptance of COR388 or any future drug candidates, if approved, and could significantly harm our business, financial condition, results of operations and prospects.

Any of these events could prevent us from achieving or maintaining market acceptance of atuzaginstat or any future drug candidates, if approved, and could significantly harm our business, financial condition, results of operations and prospects.

Success in preclinical studies or earlier clinical trials may not be indicative of results in future clinical trials.

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Any such delays could negatively impact our business, financial condition, results of operations and prospects.

Partial clinical hold imposed by the FDA will prevent us from administering COR388 at much higher doses than currently utilized.

Preclinical data for COR388 showed toxicity at very high exposure levels in mice and, as a result, the FDA placed COR388 on partial clinical hold to enforce an exposure cap on COR388 dosages in humans at approximately 2.4 times the currently planned top dose in our Phase 2/3 GAIN trial.

Although the FDA has permitted the continuation of clinical trials at the planned doses of COR388, if we determine that we need to increase the dosage of COR388 in humans, the partial hold may have a negative impact on our ability to carry out such clinical studies, which could delay or prevent the commercialization of COR388 and may harm our business and financial condition.

Clinical holds imposed by the FDA could prevent us from administering atuzaginstat at higher doses than currently utilized or planned.

Preclinical data for atuzaginstat showed toxicity at very high exposure levels in mice and, as a result, the FDA placed atuzaginstat on partial clinical hold to enforce an exposure cap on atuzaginstat dosages in humans at approximately 2.4 times the top dose of 80 mg BID in our Phase 2/3 GAIN trial.

Although the FDA has permitted the continuation of clinical trials at the planned doses of atuzaginstat, if we determine that we need to increase the dosage of atuzaginstat in humans, the partial hold, or any future clinical holds placed by the FDA may have a negative impact on our ability to carry out our clinical studies, which could delay or prevent the commercialization of atuzaginstat and may harm our business and financial condition.

In addition, the FDA placed a partial clinical hold on atuzaginstat impacting the OLE phase of the GAIN Trial following the review of hepatic adverse events in the atuzaginstat trial by the FDA.

Under the hold, we have stopped enrollment and dosing in the OLE phase of the GAIN Trial.

We may not be successful in our efforts to continue to create a pipeline of drug candidates or to develop commercially successful drugs.

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If we are unable to successfully identify, acquire, develop and commercialize additional drug candidates, our commercial opportunity may be limited.

We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercia lization of our drug candidates.

We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our drug candidates.

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

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occurrence of serious adverse events in trials of the same class of agents conducted by other companies.

the occurrence of natural disasters, such as earthquakes, tsunamis, power shortages or outages, floods, or monsoons, public health crises, such as pandemics and epidemics, political crisis, such as terrorism, war, political instability or other conflict, cyberattacks, or other events outside of our control occurring at or around our clinical trials sites in the United States or Europe.

For example, enrollment in our clinical trials may be delayed or impeded as a result of the COVID-19 pandemic due to prioritization of healthcare resources toward the pandemic, and some patients may not be able to comply with clinical trial protocols if quarantines impede patient movement or interrupt healthcare services.

In addition, we may experience increased rates of patients withdrawing from our clinical trials following enrollment as a result of contracting COVID-19 or other health conditions or because of quarantines or travel limitations (whether voluntary or required) If the patients involved with our clinical trials contract COVID-19, we may have more adverse events and deaths in our clinical trials as a result.

The Company has taken and continues to take proactive measures to maintain the integrity of its ongoing clinical trial.

For example, to potentially mitigate some of the risks of the COVID-19 pandemic and based on interest and the ability to maintain milestone timelines, we enrolled approximately 70 additional subjects in the GAIN trial.

However, these measures may not be successful, and the occurrence of any of these events could delay or impede our ability to release clinical results, delay or impact our clinical trials, including the integrity and completeness of subject data and clinical study endpoints, and could adversely impact our product candidate testing, development and timelines.

Clinical trials are expensive and time consuming, additional or unsuccessful clinical trials could cause our clinical development activities to be delayed or otherwise adversely affected.

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We do not know whether any clinical trials will begin as planned, will need to be amended or will be completed on schedule, or at all.

Significant clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our drug candidates, could allow our competitors to bring drug candidates to market before we do, and could impair our ability to successfully commercialize our drug ca ndidates, if approved, any of which may harm our business and results of operations.

Significant clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our drug candidates, could allow our competitors to bring drug candidates to market before we do, and could impair our ability to successfully commercialize our drug candidates, if approved, any of which may harm our business and results of operations.

In addition, many of the factors that cause, or lead to a delay in the commencement or completion of, clinical trials may also ultimately lead to termination or suspension of a clinical trial.

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Risks Relating to Regulatory Review and Approval of Our Drug Candidates and Other Legal Compliance Matters

We cannot be certain that COR388 or any of our future drug candidates will receive regulatory approval, and without regulatory approval we will not be able to market our drug candidates.

We cannot be certain that atuzaginstat or any of our future drug candidates will receive regulatory approval, and without regulatory approval we will not be able to market our drug candidates.

We currently have no drug candidates approved for sale and we cannot guarantee that we will ever have marketable drug candidates.

We are initially developing COR388 for the treatment of patients with Alzheimer’s disease and are also consulting with investigators to consider other possible indications.

Our ability to generate revenue related to sales, if ever, will depend on the successful development and regulatory approval of COR388 for the treatment of Alzheimer’s disease and other indications.

We are initially developing atuzaginstat for the treatment of patients with Alzheimer’s disease and are also consulting with investigators to consider other possible indications.

Our ability to generate revenue related to sales, if ever, will depend on the successful development and regulatory approval of atuzaginstat for the treatment of Alzheimer’s disease and other indications.

The development of a drug candidate and issues relating to its approval and marketing are subject to extensive regulation by the FDA in the United States, the EMA in Europe and regulatory authorities in other countries, with regulations differing from country to country.

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We cannot be certain that any submissions will be accepted for filing and review by the FDA.

Regulators of other jurisdictions, such as the EMA, have their own procedures for approval of drug candidates.

Regulators of other jurisdictions,

such as the EMA, have their own procedures for approval of drug candidates.

Even if a drug is approved, the FDA or the EMA, as the case may be, may limit the indications for which the drug may be marketed, require extensive warnings on the drug labeling or require expensive and time-consuming clinical trials or reporting as conditions of approval.

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We initiated our Phase 2/3 GAIN trial in patients with Alzheimer’s disease in April 2019.

Before we submit a NDA to the FDA or a MAA to the EMA for COR388 for the treatment of patients with Alzheimer’s disease, we must successfully complete at least our Phase 2/3 GAIN trial and potentially additional late-stage clinical trials.

Before we submit a NDA to the FDA or a MAA to the EMA for atuzaginstat for the treatment of patients with Alzheimer’s disease, we must successfully complete at least our Phase 2/3 GAIN trial and potentially additional late-stage clinical trials.

The FDA generally requires two pivotal clinical trials to support approval.

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This strategy may not prove to be successful.

We cannot be sure that our approach will yield s atisfactory therapeutic drug candidates that are safe and effective, scalable, or profitable.

Moreover, public perception of drug safety issues, including adoption of new therapeutics or novel approaches to treatment, may adversely influence the willingnes s of subjects to participate in clinical trials, or if approved, of physicians to prescribe novel treatments.

We cannot be sure that our approach will yield satisfactory therapeutic drug candidates that are safe and effective, scalable, or profitable.

Moreover, public perception of drug safety issues, including adoption of new therapeutics or novel approaches to treatment, may adversely influence the willingness of subjects to participate in clinical trials, or if approved, of physicians to prescribe novel treatments.

Clinical failure can occur at any stage of clinical development and we have never conducted a Phase 3 trial or submitted an NDA or MAA before.

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We also expect to rely on other third parties to store and distribute drug supplies for our clinical trials.

Any performance failure on the part of our distributors could delay clinical development or marketing approval of any drug candidates we may develop or commercialization of our medicin es, producing additional losses and depriving us of potential drug revenue.

Any performance failure on the part of our distributors could delay clinical development or marketing approval of any drug candidates we may develop or commercialization of our medicines, producing additional losses and depriving us of potential drug revenue.

We face significant competition in an environment of rapid technological and scientific change, and there is a possibility that our competitors may achieve regulatory approval before us or develop therapies that are safer, more advanced or more effective than ours.

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In order to conduct clinical trials of our drug candidates, or supply commercial drug candidates, if approved, we will need to manufacture them in small and large quantities.

We currently rely on third parties to manufacture COR388 for clinical trial purposes, and our manufacturing partners will have to modify and scale-up the manufacturing process when we transition to commercialization of our drug candidates.

We currently rely on third parties to manufacture atuzaginstat for clinical trial purposes, and our manufacturing partners will have to modify and scale-up the manufacturing process when we transition to commercialization of our drug candidates.

Our manufacturing partners may be unable to successfully modify or scale-up the manufacturing capacity for any of our drug candidates in a timely or cost-effective manner, or at all.

In addition, quality issues may arise during scale-up activities.

If our manufacturing partners are unable to successfully scale-up the manufacture of our drug candidates in sufficient quality and quantity, the development, testing and clinical trials of that drug candidate may be delayed or become infeasible, and regulatory approval or commercial launch of any resulting drug may be delayed or not obtained, which could

significantly harm our business.

The same risks would apply to our internal manufacturing facilities, should we in the future decide to build internal manufacturing capacity.

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We may be exposed to a variety of international risks that could materially adversely affect our business.

Our business is subject to risks associated with conducting business internationally.

Some of our suppliers and clinical trial centers are located outside of the United States.

In particular, we intend to conduct clinical trial operations in Australia.

We may enter into agreements with third parties for the development and commercialization of drug candidates in international markets.

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differing regulatory requirements for drug approvals internationally;

potentially reduced protection for intellectual property rights;

rejection or qualification of foreign clinical trial data by the competent authorities of other countries;complexities and difficulties in obtaining, maintaining, protecting and enforcing our intellectual property;

potential third-party patent rights in countries outside of the United States;

the potential for so-called “parallel importing,” which is what occurs when a local seller, faced with relatively high local prices, opts to import goods from another jurisdiction with relatively low prices, rather than buying them locally;

the potential for so-called “parallel exporting,” which is what occurs when a local seller buys goods meant for the locals and sells the goods for a higher price in another country, potentially causing or aggravating supply problems;

unexpected changes in tariffs, trade barriers and regulatory requirements;

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economies and markets, including several countries in Europe;

compliance with tax, employment, immigration and labor laws for employees traveling abroad;

compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;

regulatory and compliance risks that relate to anti-corruption compliance and record-keeping that may fall within the purview of the U.S.

Foreign Corrupt Practices Act, its accounting provisions or its anti-bribery provisions or provisions of anti-corruption or anti-bribery laws in other countries;

taxes in other countries;

financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our products and exposure to foreign currency exchange rate fluctuations;

foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country;

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production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad;

business interruptions resulting from geo-political actions, including war and terrorism, or natural disasters, including earthquakes, volcanoes, typhoons, floods, hurricanes and fires.

business interruptions resulting from geo-political actions, including war and terrorism, public health crises, such as pandemics and epidemics, or natural disasters, including earthquakes, volcanoes, typhoons, floods, hurricanes and fires.

Any of these factors could harm our ongoing international clinical operations and supply chain, as well as any future international expansion and operations and, consequently, our business, financial condition, prospects and results of operations.

Natural disasters, public health crises, political crises, and other catastrophic events or other events outside of our control may be detrimental to our capabilities or the capabilities of third parties on which we depend.

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Disasters, public health crises and political crises occurring at third-party facilities also could negatively impact our clinical development and regulatory approval timelines, our reputation and the perception of our company.

For example, if the COVID-19 outbreak continues to spread, we or our third-party service providers may need to limit operations or implement limitations, including work-from-home policies.

For example, as a result of the COVID-19 pandemic, we and our third-party service providers have limited our operations or implemented limitations, including work-from-home policies.

Our and our third-party service providers increased reliance on personnel working from home may negatively impact productivity, or disrupt, delay, or otherwise adversely impact our business.

The increase in working remotely could increase cybersecurity risk, create data accessibility concerns, and make us and our third-party service providers more susceptible to communication disruptions, any of which could adversely impact our or their business operations or delay necessary interactions with local and federal regulators, manufacturing sites, clinical trial sites, and other third parties.

In addition, as a result of shelter-in-place orders or other mandated travel restrictions, our on-site staff conducting research and development activities may not be able to access our laboratories, and these core activities may be significantly limited or curtailed, possibly for an extended period of time.

Further, due to travel restrictions and “shelter in place” orders, we may experience limitations on the ability to recruit and hire key personnel due to the inability to meet with candidates and reduced ability to engage with the medical and investor communities due to the cancelation of conferences scheduled throughout the year.

We also may experience operational challenges caused by sickness of our employees or their families, the desire of employees to avoid contact with large groups of people, and an increased reliance on working from home or mass transit disruptions.

Furthermore, new quarantines for COVID-19 or other viruses could impact personnel at contract manufacturing facilities in China, Europe or elsewhere to deliver key materials or the availability or cost of starting materials.

Any disruption of our ability to manufacture COR388 or the ability of our contract manufacturing vendors in China, Europe or elsewhere to deliver key materials on a timely basis could have a material adverse effect on the initiation of new trials, the duration of open label extension studies and overall product development.

Any disruption of our ability to manufacture atuzaginstat or the ability of our contract manufacturing vendors in China, Europe or elsewhere to deliver key materials on a timely basis could have a material adverse effect on the initiation of new trials, the duration of open label extension studies and overall product development.

In addition, we may experience delays or disruptions in non-clinical experiments and supplies for such experiments, including animals required for such experiments.

These and other factors arising from the COVID-19 pandemic could worsen in countries that are already afflicted with COVID-19, could continue to spread to additional countries, or could return to countries where the pandemic has been partially contained, each of which could further adversely impact our ability to conduct clinical trials and our business generally, and could have a material adverse impact on our operations and financial condition and results.

We will need to expand our operations and increase the size of our company, and we may experience difficulties in managing growth.

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Prior to our initial public offering in May 2019, we had never been required to test our internal controls within a specified period and, as a result, we may experience difficulty in meeting these reporting requirements in a timely manner.

We anticipate that the process of building our accounting and financial functions and infrastructure will require significant additional professional fees, internal costs and management efforts.

We expect that we will need to implement a new internal system to combine and streamline the management of our financial, accounting, human resources and other functions.

However, such a system would likely require us to complete many processes and procedures for the effective use of the system or to run our business using the system, which may result in substantial costs.

Any disruptions or difficulties in implementing or using such a system could adversely affect our controls and harm our business.

We anticipate that the process of continuing to build our accounting and financial functions and infrastructure will require additional professional fees, internal costs and management efforts.

We expect that we will need to implement new internal systems to streamline the management of our financial, accounting, human resources and other functions.

However, such systems would likely require us to complete many processes and procedures for the effective use of the systems or to run our business using the systems, which may result in additional costs.

Any disruptions or difficulties in implementing or using such systems could adversely affect our controls and harm our business.

Moreover, such disruption or difficulties could result in unanticipated costs and diversion of management attention.

In addition, we may discover weaknesses in our system of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements.

In addition, we may discover weaknesses in our systems of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements.

For example, we previously reported a material weakness in internal control over financial reporting related to the fact that we had not deployed adequate qualified resources in our corporate accounting department which resulted in material audit adjustments that were needed to modify the financial statements to comply with accounting principles generally accepted in the United States.

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If we cannot provide reliable financial reports or prevent fraud, our business and results of operations could be harmed, investors could lose confidence in our reported financial information and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

Our employees, independent contractors, consultants, commercial partners and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements and insider trading, which co uld significantly harm our business.

We are exposed to the risk of fraud or other misconduct by our employees, independent contractors, consultants, commercial partners and vendors.

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The GDPR will increase our responsibility and liability in relation to personal data that we process, and we may be required to put in place additional potential mechanisms to ensure compliance with the new EU data protection rules.

Furt her, the United Kingdom’s vote in favor of exiting the EU (often referred to as “Brexit”) has created uncertainty with regard to data protection regulation in the United Kingdom.

In particular, it is unclear whether the United Kingdom will enact data prote ction legislation equivalent to the GDPR and how data transfers to and from the United Kingdom will be regulated.

Further, the United Kingdom’s vote in favor of exiting the EU (often referred to as “Brexit”) has created uncertainty with regard to data protection regulation in the United Kingdom.

In particular, it is unclear whether the United Kingdom will enact data protection legislation equivalent to the GDPR and how data transfers to and from the United Kingdom will be regulated.

Compliance with U.S.

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While the Trump Administration and the Centers for Medicare & Medicaid Services, or CMS, have both stated that the ruling will have no immediate effect, it is unclear how this decision, subsequent appeals, if any, and other efforts to repeal and replace the Affordable Care Act will

impact the Affordable Care A ct and our business.

Moreover, the Bipartisan Budget Act of 2018, or the BBA, among other things, amends the Affordable Care Act, effective January 1, 2019, to close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole.” Co ngress may consider additional legislation to repeal, or repeal and replace, other elements of the Affordable Care Act.

impact the Affordable Care Act and our business.

Moreover, the Bipartisan Budget Act of 2018, or the BBA, among other things, amends the Affordable Care Act, effective January 1, 2019, to close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole.” Congress may consider additional legislation to repeal, or repeal and replace, other elements of the Affordable Care Act.

We continue to evaluate the Affordable Care Act and its possible repeal and replacement, as it remains uncertain the extent to which any such changes may impact our business or financial condition.

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Similar prescription drug price transparency laws have been enacted in Oregon and California, and more are pending in several other states.

Additionally, on May 30, 2018, the Trickett Wendler, Frank Mongiello, Jordan McLinn, and Matthew Bellina Right to Try Act of 2017, or Right to Try Act, was signed into law.

The law, among other things, provides a federal framework for certain patients with life-threatening diseases or conditions to access certain investigational new drug candidates that have completed a Phase 1 clinical trial and that are undergoing investigation for FDA approval.

Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA permission under the FDA expanded access program.

There is no obligation for a drug manufacturer to make its drugs available to eligible patients as a result of the Right to Try Act.

We expect that these and other healthcare reform measures that may be adopted in the future may result in more rigorous coverage criteria and lower reimbursement, and in additional downward pressure on the price that we receive for any approved drug candidate.

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As a result, the coverage determination process is often a time consuming and costly process that may require us to provide scientific and clinical support for the use of our products to each payor separately, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained.

There may be significant delays in obtaining coverage and reimbursement for newly approved drugs, and coverage may be more limited than the purposes for which the medicine is approved by the FDA, EMA or other compa rable foreign regulatory authorities.

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

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

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

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

Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimb ursement policies, but make their determinations independently and may impose additional restrictions.

Our inability to promptly obtain coverage and profitable payment rates from both government-funded and private payors for any approved products we may de velop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize drug candidates, and our overall financial condition.

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

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

Net prices for drugs may be reduced by mandatory discounts or

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

Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies, but make their determinations independently and may impose additional restrictions.

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

In the EU, coverage and reimbursement status of any drug candidates for which we obtain regulatory approval are provided for by the national laws of EU Member States.

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From time to time, we may also disclose interim data from our clinical studies.

I n addition, we may report interim analyses of only certain endpoints rather than all endpoints.

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

In addition, we may report interim analyses of only certain endpoints rather than all endpoints.

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

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

Further, disclosure of interim data by us or by our competitors could result in v olatility in the price of our common stock.

Further, others, including regulatory agencies, may not accept or agree with our assumptions, estimates, calculations, conclusions or analyses or may interpret or weigh the importance of data differently, which could impact the value of the particular program, the approvability or commercialization of the particular drug candidate or product and our company in general.

In addition, the information we choose to publicly disclose regarding a particular study or cli nical trial is based on what is typically extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities or otherwise regarding a particular drug, drug candidate or our business.

If the top-line data that we report differ from actual results, or if others, includ ing regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for, and commercialize, our drug candidates may be harmed, which could harm our business, operating results, prospects or financial condition.

Changes in funding for the FDA and other government agencies could hinder their ability to hire and retain key leadership and other personnel, or otherwise prevent new products and services from being developed or commercialized in a timely manner, which could negatively impact our business.

Further, disclosure of interim data by us or by our competitors could result in volatility in the price of our common stock.

company in general.

In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities or otherwise regarding a particular drug, drug candidate or our business.

If the top-line data that we report differ from actual results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for, and commercialize, our drug candidates may be harmed, which could harm our business, operating results, prospects or financial condition.

Changes in funding for the FDA and other government agencies or other disruptions at these agencies could prevent new products and services from being developed or commercialized in a timely manner, which could negatively impact our business.

The ability of the FDA to review and approve new drugs can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes.

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If a prolonged government shutdown occurs, 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.

As a result of the COVID-19 pandemic, health regulatory agencies globally have experienced and may continue to experience disruptions in their operations.

The FDA, EMA and comparable foreign regulatory agencies may have slower response times or be under-resourced to continue discussions with us regarding the scope or design of our clinical trials and, as a result, review, inspection, and other timelines may be materially delayed.

It is unknown how long these disruptions could continue, were they to occur.

Any elongation or de-prioritization of our clinical trials or delay in regulatory review resulting from such disruptions could affect the development and study of atuzaginstat.

Even if we obtain regulatory approval for a drug candidate, it will remain subject to extensive ongoing regulatory review and requirements.

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An unsuccessful post-marketing study or failure to complete such a study could result in the withdrawal of marketing approval.

If a regulatory agency discovers previou sly unknown problems with a drug, such as adverse events of unanticipated severity or frequency, or problems with the facility where the drug candidate is manufactured, or disagrees with the promotion, marketing or labeling of a drug candidate, such regula tory agency may impose restrictions on that drug candidate or us, including requiring withdrawal of the drug candidate from the market.

If we fail to comply with applicable regulatory requirements, a regulatory agency or enforcement authority may, among ot her things:

If a regulatory agency discovers previously unknown problems with a drug, such as adverse events of unanticipated severity or frequency, or problems with the facility where the drug candidate is manufactured, or disagrees with the promotion, marketing or labeling of a drug candidate, such regulatory agency may impose restrictions on that drug candidate or us, including requiring withdrawal of the drug candidate from the market.

If we fail to comply with applicable regulatory requirements, a regulatory agency or enforcement authority may, among other things:

issue warning or untitled letters that would result in adverse publicity;

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In addition, the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act;

federal civil and criminal false claims laws and civil monetary penalty laws, including the False Claims Act, which impose criminal and civil penalties, including through ci vil “qui tam” or “whistleblower” actions, against individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid, or other third-party payors that are false or fraudulent or knowingly m aking a false statement to improperly avoid, decrease or conceal an obligation to pay money to the federal government.

Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of these statutes or specific int ent to violate them in order to have committed a violation;

federal civil and criminal false claims laws and civil monetary penalty laws, including the False Claims Act, which impose criminal and civil penalties, including through civil “qui tam” or “whistleblower” actions, against individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid, or other third-party payors that are false or fraudulent or knowingly making a false statement to improperly avoid, decrease or conceal an obligation to pay money to the federal government.

Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of these statutes or specific intent to violate them in order to have committed a violation;

the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created new federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters;

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Any collaboration arrangements that we may enter into in the future may not be successful, which could adversely affect our ability to develop and commercialize potential future drug candidates.

While we currently have no intention to enter into a collaboration agreement for COR388, in the future we may consider collaboration arrangements with pharmaceutical or biotechnology companies for the development or commercialization of drug candidates depending on the merits of retaining or divesting some or all commercialization rights.

While we currently have no intention to enter into a collaboration agreement for atuzaginstat, in the future we may consider collaboration arrangements with pharmaceutical or biotechnology companies for the development or commercialization of drug candidates depending on the merits of retaining or divesting some or all commercialization rights.

We will face, to the extent that we decide to enter into collaboration agreements, significant competition in seeking appropriate collaborators.

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The terms of any collaborations or other arrangements that we may establish may not be favorable to us.

Any future collaboratio ns that we enter into may not be successful.

Any future collaborations that we enter into may not be successful.

The success of our collaboration arrangements will depend heavily on the efforts and activities of our collaborators.

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Further, if any patents we obtain or license are deemed invalid and unenforceable, our ability to commercialize or license our technology could be adversely affected.

Others may have file d, and in the future are likely to file, patent applications covering drug candidates that are similar, identical or competitive to ours or important to our business.

We cannot be certain that any patent application owned by a third party will not have pri ority over patent applications filed or in-licensed by us, or that we or our licensors will not be involved in interference, opposition or invalidity proceedings before U.S.

Others may have filed, and in the future are likely to file, patent applications covering drug candidates that are similar, identical or competitive to ours or important to our business.

We cannot be certain that any patent application owned by a third party will not have priority over patent applications filed or in-licensed by us, or that we or our licensors will not be involved in interference, opposition or invalidity proceedings before U.S.

patent offices.

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However, we may not be able to apply for patents on certain aspects of our current or future drug candidates, proprietary technologies and their uses in a timely fashion, at a reasonable cost, in all jurisdictions, or at all, and any potential patent coverage we obtain may not be sufficient to prevent substantial competition.

As of December 31, 2019, we were the owner of record of three issued U.S.

patents, one non-U.S.

patent, and 59 pending U.S.

As of December 31, 2020, we were the owner of record of six issued U.S.

patents, 31 non-U.S.

patents, and 54 pending U.S.

patent applications (collectively, “the Cortexyme patent portfolio”).

Two issued U.S.

patents in the Cortexyme patent portfolio relate to COR388, with claims directed to COR388 and related pharmaceutical compounds, pharmaceutical compositions containing these compounds, and methods of using these compounds in the treatment of various indications.

patent applications in the Cortexyme patent portfolio relate to COR388 and related pharmaceutical compounds, pharmaceutical compositions containing these compounds, methods of using these compounds in the treatment of various indications, and methods of making these compounds.

In addition, one issued U.S.

patent in the Cortexyme patent portfolio relates to pharmaceutical compounds that do not encompass COR388, with claims directed to pharmaceutical compounds, pharmaceutical compositions containing these compounds, and methods of using these compounds in the treatment of various indications.

Four issued U.S.

patents and 31 issued non-US patents in the Cortexyme patent portfolio relate to atuzaginstat , with claims directed to atuzaginstat and related pharmaceutical compounds, pharmaceutical compositions containing these compounds, and use of these compounds in the treatment of various indications.

patent applications in the Cortexyme patent portfolio relate to atuzaginstat and related pharmaceutical compounds, pharmaceutical compositions containing these compounds, methods of using these compounds in the treatment of various indications, and methods of making these compounds.

In addition, two issued U.S.

patents in the Cortexyme patent portfolio relate to pharmaceutical compounds that do not encompass atuzaginstat , with claims directed to pharmaceutical compounds, pharmaceutical compositions containing these compounds, and use of these compounds in the treatment of various indications.

patent applications relate to additional compounds in these areas;

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patents that may be issued or in-licensed may be challenged, invalidated, modified, revoked, circumvented, found to be unenforceable or otherwise may not provide any competitive advantage;

our competitors, many of whom have substant ially greater resources than we do and many of whom have made significant investments in competing technologies, may seek or may have already obtained patents that will limit, interfere with or eliminate our ability to make, use and sell our potential drug candidates;

our competitors, many of whom have substantially greater resources than we do and many of whom have made significant investments in competing technologies, may seek or may have already obtained patents that will limit, interfere with or eliminate our ability to make, use and sell our potential drug candidates;

other parties may have designed around our claims or developed technologies that may be related or competitive to our platform, may have filed or may file patent applications and may have received or may receive patents that overlap or conflict with our patent applications, either by claiming the same compounds, compositions or methods or by claiming subject matter that could dominate our patent position;

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Supreme Court has recently modified some tests used by the USPTO in granting patents over the past 20 years, which may decrease the likelihood that we will be able to obtain patents and increase the likelihood of challenge of any patents we obtain or license.

Interference or derivation proceedings provoked by third parties or brought by u s or declared by the USPTO may be necessary to determine the priority of inventions with respect to our patents or patent applications.

Interference or derivation proceedings provoked by third parties or brought by us or declared by the USPTO may be necessary to determine the priority of inventions with respect to our patents or patent applications.

An unfavorable outcome could require us to cease using the related technology or to attempt to license rights to it from the prevailing party.

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Our defense of litigation or interference proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees.

In addition, the uncertainties associated with litigation could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties or enter into development or manufacturing partnerships that would help us bring our drug candidates t o market.

Even if resolved in our favor, litigation or other legal proceedings relating to our intellectual property rights may cause us to incur significant expenses, and could distract our technical and management personnel from their normal responsibilities.

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The coverage of patents is subject to interpretation by the courts, and the interpretation is not always uniform.

Any claims of patent infringement asserted by third parti es would be time consuming and could:

Any claims of patent infringement asserted by third parties would be time consuming and could:

result in costly litigation;

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cause development delays;

prevent us from commercializing COR388 or our other drug candidates until the asserted patent expires or is finally held invalid or not infringed in a court of law;

prevent us from commercializing atuzaginstat or our other drug candidates until the asserted patent expires or is finally held invalid or not infringed in a court of law;

require us to develop non-infringing technology, which may not be possible on a cost-effective basis;

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Numerous third-party U.S.

and foreign issued patents and pending patent applications exist in the fields in which we are develop ing drug candidates.

and foreign issued patents and pending patent applications exist in the fields in which we are developing drug candidates.

There may be third-party patents or patent applications with claims to compositions, formulations, methods of manufacture or methods for treatment related to the use or manufacture of our drug candidates.

Any such patent application ma y have priority over our patent applications, which could further require us to obtain rights to issued patents covering such technologies.

Any such patent application may have priority over our patent applications, which could further require us to obtain rights to issued patents covering such technologies.

If another party has filed a U.S.

patent application on inventions similar to ours, we may have to participate in an interference proceeding declared by the USPTO to determine priority of invention in the United States.

The costs of these proceedings could be substantial, and it is possible that such efforts would be unsuccessful if, unbeknownst to us, the other party h ad independently arrived at the same or similar inventions prior to our own inventions, resulting in a loss of our U.S.

The costs of these proceedings could be substantial, and it is possible that such efforts would be unsuccessful if, unbeknownst to us, the other party had independently arrived at the same or similar inventions prior to our own inventions, resulting in a loss of our U.S.

patent position with respect to such inventions.

Other countries have similar laws that permit secrecy of patent applications, and may b e entitled to priority over our applications in such jurisdictions.

Other countries have similar laws that permit secrecy of patent applications, and may be entitled to priority over our applications in such jurisdictions.

Some of our competitors may be able to sustain the costs of complex patent litigation more effectively than we can because they have substantially greater resources.

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technological security measures.

Despite these ef forts, we cannot provide any assurances that all such agreements have been duly executed, and these agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information.

Despite these efforts, we cannot provide any assurances that all such agreements have been duly executed, and these agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information.

In addition, others may independently discover our trade secrets and proprietary information.

For example, the FDA, as part of its Transparency Initiative, is currently considering whether to make additional information public ly available on a routine basis, including information that we may consider to be trade secrets or other proprietary information, and it is not clear at the present time how the FDA’s disclosure policies may change in the future, if at all.

For example, the FDA, as part of its Transparency Initiative, is currently considering whether to make additional information publicly available on a routine basis, including information that we may consider to be trade secrets or other proprietary information, and it is not clear at the present time how the FDA’s disclosure policies may change in the future, if at all.

Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position.

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Our business would suffer if any such licenses terminate, if the licensors fail to abide by the terms of the license, if the licensors fail to enforce licensed patents against infringing third parties, if the licensed patents or other rights are found to be invalid or unenforceable, or if we are unable to enter into necessary licenses on acceptable terms.

Furthermore, if any exc lusive licenses terminate, or if the underlying patents fail to provide the intended exclusivity, competitors or other third parties may gain the freedom to seek regulatory approval of, and to market, drug candidates identical to ours.

Moreover, our licens ors may own or control intellectual property that has not been licensed to us and, as a result, we may be subject to claims, regardless of their merit, that we are infringing or otherwise violating the licensor’s rights.

In addition, while we cannot curren tly determine the amount of the royalty obligations, we would be required to pay on sales of future drug candidates, if any, the amounts may be significant.

Furthermore, if any exclusive licenses terminate, or if the underlying patents fail to provide the intended exclusivity, competitors or other third parties may gain the freedom to seek regulatory approval of, and to market, drug candidates identical to ours.

Moreover, our licensors may own or control intellectual property that has not been licensed to us and, as a result, we may be subject to claims, regardless of their merit, that we are infringing or otherwise violating the licensor’s rights.

In addition, while we cannot currently determine the amount of the royalty obligations, we would be required to pay on sales of future drug candidates, if any, the amounts may be significant.

The amount of our future royalty obligations will likely depend on the technology and intellectual property we use in drug candidates that we successfully develop and commercialize, if any.

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courts, the USPTO and the relevant law-making bodies in other countries, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce our existing patents and patents that we might obtain in the future.

We may become subject to claims challenging the inventorship or ownership of our paten ts and other intellectual property.

We may become subject to claims challenging the inventorship or ownership of our patents and other intellectual property.

We may be subject to claims that former employees or other third parties have an interest in our patents or other intellectual property as an inventor or co-inventor.

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Even if patents covering our drug candidates are obtained, once the patent life has expired for a drug candidate, we may be open to competition from generic products.

A patent term extension of up to five years based on regulatory delay may be available in the United States under the

Hatch-Waxman Act.

A patent term extension of up to five years based on regulatory delay may be available in the United States under the Hatch-Waxman Act.

However, only a single patent can be extended for each marketing approval, and any patent can be extended only once, for a single drug candidate.

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Similar requirements exist in Europe.

The FDA typically con ducts a review of proposed drug candidate names, including an evaluation of potential for confusion with other drug candidate names.

If the FDA (or an equivalent administrative body in a foreign jurisdiction) objects to any of our proposed proprietary drug candidate names, we may be required to expend significant additional resources in an effort to identify a suitable substitute name that would qualify under applicable trademark laws, not infringe the existing rights of third parties and be acceptable to t he FDA.

The FDA typically conducts a review of proposed drug candidate names, including an evaluation of potential for confusion with other drug candidate names.

Furthermore, in many countries, owning and maintaining a trademark registration may not provide an adequate defense against a subsequent infringement claim asserted by the owner of a senior trademark.

At times, competitors or other third parties ma y adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion.

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

If we assert trademark infringement claims, a court may determine that the marks we have asserted are invalid or unenforceable, or t hat the party against whom we have asserted trademark infringement has superior rights to the marks in question.

At times, competitors or other third parties may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion.

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

If we assert trademark infringement claims, a court may determine that the marks we have asserted are invalid or unenforceable, or that the party against whom we have asserted trademark infringement has superior rights to the marks in question.

In this case, we could ultimately be forced to cease use of such trademarks.

If COR388, our lead drug candidate, obtains regulatory approval, additional competitors could enter the market with generic versions, which may result in a material decline in sales of affected drugs.

If atuzaginstat, our lead drug candidate, obtains regulatory approval, additional competitors could enter the market with generic versions, which may result in a material decline in sales of affected drugs.

Under the Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Act, a pharmaceutical manufacturer may file an abbreviated new drug application, or ANDA, seeking approval of a generic copy of an approved, small molecule innovator drug.

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Accordingly, if any of our small molecule drug candidates receive FDA approval, competitors could file ANDAs for generic versions of our drugs or 505(b)(2) NDAs that reference our drugs, respectively.

If there are patents listed for COR388 in the Orange Book, those ANDAs and 505(b)(2) NDAs would be required to include a certification as to each listed patent indicating whether the ANDA applicant does or does not intend to challenge the patent.

If there are patents listed for atuzaginstat in the Orange Book, those ANDAs and 505(b)(2) NDAs would be required to include a certification as to each listed patent indicating whether the ANDA applicant does or does not intend to challenge the patent.

We cannot predict how any generic competitor would address patents we may list in the Orange Book, if any, whether we would sue on any such patents, or the outcome of any such suit.

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the expiration of contractual lock-up agreements with our executive officers, directors and stockholders;

general economic and market conditions.

general economic and market conditions, including developments relating to the COVID-19 pandemic and the associated economic downturn.

Furthermore, the stock markets have experienced price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies.

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Accordingly, investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.

General Risk Factors

Insiders have substantial control over us and will be able to influence corporate matters.

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These and other provisions in our amended and restated certificate of incorporation and our amended and restated bylaws and under Delaware law could discourage potential takeover attempts, reduce the price investors might be willing to pay in the future for shares of our common stock and result in the market price of our common stock being lower than it would be without these provisions.

Our amended and restated certificate of incorporation will provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ abilities to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware is the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ abilities to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our amended and restated certificate of incorporation provide that, unless we consent to the selection of an alternative forum, to the fullest extent permitted by law, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for:

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Our amended and restated certificate of incorporation also provide that the federal district courts of the United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action against us or any of our directors, officers, employees or agents and arising under the Securities Act.

We believe these provisions may benefit us by providing increased consistency in the application of Delaware law and federal securities laws by chancellors and judges, as applicable, particularly experienced in resolving corporate disputes, efficient administration of cases on a more expedited schedu le relative to other forums and protection against the burdens of multi-forum litigation.

However, these provisions may have the effect of discouraging lawsuits against our directors and officers.

The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that, in connection with any applicable action brought against us, a court could find the choice of forum provisions contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in such action.

For example, in December 2018, the Delaware Court of Chancery invalidated provisions in the certificates of incorporation of Delaware companies that purport to design ate federal district courts as the exclusive forum in which a stockholder could bring a claim under the Securities Act.

Consequently, we do not intend to enforce the federal forum selection provision in our amended and restated certificate of incorporation unless and until such time there is a final determination by the Delaware Supreme Court regarding the validity of provisions such as the federal forum selection provision.

To the extent the Delaware Supreme Court makes a final determination that provision s such as the federal forum selection provision are not valid as a matter of Delaware law, we intend to amend our amended and restated certificate of incorporation to remove the federal forum selection provision.

We believe these provisions may benefit us by providing increased consistency in the application of Delaware law and federal securities laws by chancellors and judges, as applicable, particularly experienced in resolving corporate disputes, efficient administration of cases on a more expedited schedule relative to other forums and protection against the burdens of multi-forum litigation.

However, these provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees.

While the Delaware Supreme Court recently determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring such a claim arising under the Securities Act against us, our directors, officers, or other employees in a venue other than in the federal district courts of the United States of America.

In such instance, we would expect to vigorously assert the validity and enforceability of the exclusive forum provisions of our amended and restated certificate of incorporation, and this may require significant additional costs associated with resolving such action in other jurisdictions.

Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.

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we may not retroactively amend our amended and restated bylaw provisions to reduce our indemnification obligations to directors, officers, employees and agents.

We are an “emerging growth company,” and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our common stock less attractive to investors.

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, as amended, or the JOBS Act, and we have and intend to continue to take advantage of some of the exemptions from reporting requirements that are applicable to other public companies that are not emerging growth companies, including:

being permitted to provide only two years of audited financial statements, in addition to any required unaudited interim financial statements, with correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations” disclosure;

being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting;

not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements;

reduced disclosure obligations regarding executive compensation;

not being required to hold non-binding advisory votes on executive compensation or new executive compensation arrangements in connection with a merger, acquisition, consolidation, proposed sale or disposition of all or substantially all of our assets.

Further, the JOBS Act permits an “emerging growth company” such as us to take advantage of an extended transit ion time to comply with new or revised accounting standards as applicable to public companies.

We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards applicable to public companies.

We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions.

If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

We may take advantage of these reporting exemptions until we are no longer an emerging growth company.

We will remain an emerging growth company until the earlier of (1) December 31, 2024, (2) the last day of the fiscal year in which we have total annual gross revenue of at least $1.07 billion, (3) the last day of the fiscal year in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th and (4) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

Our internal computer systems, or those used by our third-party research institution collaborators, CROs or other contractors or consultants, may fail or suffer security breaches.

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To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or systems, or inappropriate disclosure of confidential or proprietary information, we could incur liability and the further development and commercialization of our drug candidates could be delayed.

Our ability to utilize our federal net operating loss and tax credit carryforwards may be limited under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, or the Code.

The limitations apply if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50 percentage point change (by value) in its equity ownership by certain stockholders over a three-year period.

If we have experienced an ownership change at any time since our incorporation, we may already be subject to limitations on our ability to utilize our existing net operating losses, or NOLs, and other tax attributes to offset taxable income or tax liability.

Our ability to utilize our federal net operating loss and tax credit carryforwards may be limited.

Our net operating loss, or NOL, carryforwards could expire unused and be unavailable to offset future income tax liabilities because of their limited duration or because of restrictions under U.S.

NOLs generated in tax years ending on or prior to December 31, 2017 are only permitted to be carried forward for 20 taxable years under applicable U.S.

federal tax law.

Moreover, under the Tax Act as modified by the CARES Act, federal NOLs generated in tax years beginning after December 31, 2017 may be carried forward indefinitely, but the deductibility of such federal NOLs may be limited to 80% of current year taxable income for tax years beginning after January 1, 2021.

Under Sections 382 and 383 of the Internal Revenue Code, of 1986, as amended (“Code”), limitations on a corporation’s ability to use its NOLs and tax credit carryforwards apply if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50 percentage point change (by value) in its equity ownership by certain stockholders over a three-year period.

If we have experienced an ownership change at any time since our incorporation, we may already be subject to limitations on our ability to utilize our existing NOL carryforwards and other tax attributes to offset taxable income or tax liability.

In addition, future changes in our stock ownership, which may be outside of our control, may trigger an ownership change.

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As a result, even if we earn net taxable income in the future, our ability to use our pre-change NOL carryforwards and other tax attributes to offset such taxable income or tax liability may be subject to limitations, which could potentially result in increased future income tax liability to us.

tax legislation and future changes to applicable U.S.

tax laws and regulations may have a material adverse effect on our business, financial condition and results of operations.

Changes in laws and policy relating to taxes may have an adverse effect on our business, financial condition and results of operations.

For example, the U.S.

government recently enacted significant tax reform legislation, and certain provisions of the new law may adversely affect us.

Changes include, but are not limited to, a federal corporate income tax rate decrease to 21% for tax years beginning after December 31, 2017, a reduction to the maximum deduction allowed for net operating losses generated in tax years after December 31, 2017 and the elimination of carrybacks of net operating losses.

The legislation is unclear in many respects and could be subject to potential amendments and technical corrections and is subject to interpretations and implementing regulations by the Treasury and Internal Revenue Service, any of which could mitigate or increase certain adverse effects of the legislation.

In addition, it is unclear how these U.S.

federal income tax changes will affect state and local taxation.

Generally, future changes in applicable U.S.

tax laws and regulations, or their interpretation and application could have an adverse effect on our business, financial condition and results of operations.

Unresolved Staff Comments.

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