What changed in this filing

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Item 1A. Risk Factors

2023-11-07 compared with 2023-08-01 · 44 added, 35 removed, 857 unchanged (8% of the section changed)

14 unchanged sentences

If we fail to comply with these regulations or to maintain these approvals our business could be materially harmed.

● We are exposed to a number of external factors such as competition, insurance coverage of and pricing and reimbursement for our product candidates that may adversely affect our product revenue and that may cause our business to suffer.

We also have experienced and could continue to experience increased competition for, and compensation expenses associated with employee recruiting and employee retention, which could adversely affect our business.

● We rely, and expect to continue to rely, on third parties to conduct, supervise, and monitor our preclinical studies and clinical trials, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials or failing to comply with regulatory requirements.

● We rely on licenses of intellectual property from third parties, and such licenses may not provide adequate rights or may not be available in the future on commercially reasonable terms or at all, and our licensors may be unable to obtain and maintain patent protection for the technology or products that we license from them.

● If we are unable to obtain and maintain patent protection for our technology and products, or if the scope of the patent protection is not sufficiently broad, our ability to successfully commercialize our products may be impaired.

● Our reliance on third parties may require us to share our trade secrets and other proprietary technology, which could increase the possibility that a competitor will discover them or that our trade secrets and other proprietary technology will be misappropriated or disclosed.

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The amount of capital we require will depend in part on the future payments we receive from CSL Behring related to HEMGENIX® commercial supply, contractual milestones, and royalties on net sales (to the extent not owed to settle the liability from royalty financing).

● Our relationships with employees, customers, and third parties are subject to applicable laws and regulations, the non-compliance of any of which could have a material adverse effect on our business, financial condition, and results of operations.

● We are subject to laws governing data protection in the different jurisdictions in which we operate.

The implementation of such data protection regimes is complex, and should we fail to fully comply, we may be subject to penalties that may have an adverse effect on our business, financial condition, and results of operations.

● Actions that we have taken to restructure our business in alignment with our strategic priorities, including the Reorganization, may not be as effective as anticipated.

● Our internal computer systems, or those of our collaborators or other contractors or consultants, may fail or suffer security breaches or other errors or disruptions, which could result in a material disruption of our product development programs, such as potential issues with data integrity or loss of data.

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In addition, there is the potential risk of delayed adverse events following exposure to gene therapy products due to persistent biological activity of the genetic material or other components of products used to carry the genetic material.

A small number of patients have experienced serious adverse events during our clinical trials of either AMT-060 (our first-generation hemophilia B gene therapy), etranacogene dezaparvovec, and AMT-130.

However, adverse events in our clinical trials or those conducted by other parties (even if not ultimately attributable to our product candidates), and the resulting publicity, could result in delay, a hold or termination of our clinical trials, increased governmental regulation, unfavorable public perception, failure of the medical community to accept and prescribe gene therapy treatments, potential regulatory delays in the testing or approval of our product candidates, stricter labeling requirements for those product candidates that are approved and a decrease in demand for any such product candidates.

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If we fail to comply with these regulations or maintain these approvals our business could be materially harmed.

Our manufacturing facility in Lexington is subject to ongoing regulation and periodic inspection by the FDA, EU member state, and other regulatory bodies to ensure compliance with current cGMP requirements.

Our manufacturing facility in Lexington, MA is subject to ongoing regulation and periodic inspection by the FDA, EU member state, and other regulatory bodies to ensure compliance with current cGMP requirements.

Any failure to follow and document our adherence to such cGMP regulations or other regulatory requirements may lead to significant delays in the availability of products for commercial sale or clinical study, may result in the termination of or a hold on a clinical study, or may delay or prevent filing or approval of marketing applications for our products.

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Additionally, we may not be able to scale up some or all our manufacturing processes, which may result in delays in regulatory approvals, inability to produce sufficient amounts of commercial product, or otherwise adversely affect our ability to manufacture sufficient amounts of our products.

Many factors common to the manufacturing of most biologics and drugs could also cause production interruptions, including raw materials shortages, raw material failures, growth media failures, equipment malfunctions, facility contamination, labor problems, natural disasters, disruption in utility services, terrorist activities, war or cases of force majeure and acts of God (including the effects of the Covid pandemic) beyond our control.

Many factors common to the manufacturing of most biologics and drugs could also cause production interruptions, including raw materials shortages, raw material failures, limited control over pricing of raw materials, growth media failures, equipment malfunctions, facility contamination, labor problems, natural disasters, disruption in utility services, terrorist activities, war or cases of force majeure and acts of God (including the effects of the COVID-19 pandemic) beyond our control.

We also may encounter problems in hiring and retaining the experienced specialized personnel needed to operate our manufacturing process, which could result in delays in our production or difficulties in maintaining compliance with applicable regulatory requirements.

Any problems in our manufacturing processes or facilities could make us a less attractive collaborator for academic research institutions and other parties, which could limit our access to additional attractive development programs, result in delays in our clinical development or marketing schedules and materially harm our business.

We currently rely and expect to continue to rely on third parties to conduct product manufacturing for certain of our product candidates, and these third parties may not perform satisfactorily.

We currently rely, and expect to continue to rely, on third parties for the production of some of our preclinical study and planned clinical trial materials and, therefore, we can control only certain aspects of their activities.

The facilities used by us and our contract manufacturers to manufacture certain of our product candidates must be reviewed by the FDA pursuant to inspections that will be conducted after we submit a BLA to the FDA.

We do not control the manufacturing process of, and are completely dependent on, our contract manufacturing partners for compliance with the cGMP for manufacture of our products.

If we or our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of the FDA or others, we will not be able to obtain and/or maintain regulatory approval for our products as manufactured at their manufacturing facilities.

In addition, we have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified personnel.

If the FDA or a comparable foreign regulatory authority does not approve these facilities for the manufacture of our product candidates or if it withdraws any such approval in the future, we may need to find alternative manufacturing facilities, which would significantly impact our ability to develop, obtain regulatory approval for or market our product candidates, if approved.

Our use of viruses, chemicals and other hazardous materials requires us to comply with regulatory requirements and exposes us to significant potential liabilities.

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We face worldwide competition from larger pharmaceutical companies, specialty pharmaceutical companies and biotechnology firms, universities and other research institutions and government agencies that are developing and commercializing pharmaceutical products.

Our key competitors focused on developing therapies in various indications, include among others, Pfizer, Freeline Therapeutics, Intellia Therapeutics, Sangamo Biosciences, Voyager Therapeutics, Passage Bio, Roche, PTC Therapeutics, Prilenia Therapeutics, CombiGene, Caritas Therapeutics, Alnylam, Wave Life Sciences, Bayer AG, Amicus Therapeutics and 4D Molecular Therapeutics.

Our key competitors focused on developing therapies in various indications, include among others, Pfizer, Freeline Therapeutics, Intellia Therapeutics, Sangamo Biosciences, Voyager Therapeutics, Passage Bio, Roche, PTC Therapeutics, Prilenia Therapeutics, CombiGene, Alnylam, Wave Life Sciences, Bayer AG, Amicus Therapeutics and 4D Molecular Therapeutics.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than the products that we develop.

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Licenses to additional third-party technology that may be required for our development programs may not be available in the future or may not be available on commercially reasonable terms, which could have a material adverse effect on our business and financial condition.

In some circumstances, we may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology that we license from third parties.

In some circumstances, we may not have the right, or have otherwise given up the right, to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology that we own or license from third parties.

In addition, some of our agreements with our licensors require us to obtain consent from the licensor before we can enforce patent rights, and our licensor may withhold such consent or may not provide it on a timely basis.

Therefore, we cannot be certain that these patents and applications will be prosecuted and enforced in a manner consistent with the best interests of our business.

Therefore, we cannot be certain that these patents and applications will be prosecuted and enforced in a manner consistent with the best interests of our business which may materially impact any revenue that may be due to us in connection with such patents.

In addition, if third parties who license patents to us fail to maintain such patents, or lose rights to those patents, the rights we have licensed may be reduced or eliminated.

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The patents we own currently are and may become subject to future patent opposition or similar proceedings.

For example, we are currently defending a patent case in each of Canada, the United Kingdom, the Netherlands and the U.S.

The latter defense is at the U.S.

Court of Appeals for the Federal Circuit level.

These oppositions and future patent oppositions may result in loss of scope of some claims or the entire patent.

Our competitors may be able to circumvent our owned or licensed patents by developing similar or alternative technologies or products in a non-infringing manner.

Additionally, the patent prosecution process is expensive, time-consuming, and uncertain, and in certain instances we have chosen, and in the future we may choose, not to file and prosecute all necessary or desirable patent applications.

For example, our defense of certain patent cases in each of Canada, the United Kingdom, the Netherlands and the U.S.

pertaining to licensed rights of etranacogene dezaparvovec was assumed by CSL Behring on October 11, 2023.

These oppositions and future patent oppositions may result in loss of scope of some claims or the entire patent and, with respect to our rights under the CSL Agreement, could affect CSL’s successful commercialization of HEMGENIX® and, in turn, could negatively impact our financial position.

Additionally, our competitors may be able to circumvent our owned or licensed patents by developing similar or alternative technologies or products in a non-infringing manner.

Successful challenges to our patents may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated, or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and products.

The patent prosecution process is expensive, time-consuming, and uncertain, and we may not be able to file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner.

It is also possible that we will fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection.

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Risks Related to Our Financial Position and Need for Additional Capital

We had a loss in the six months ended June 30, 2023 and year ended December 31, 2022, incurred significant losses in previous years and expect to incur losses during the current and over the next several years and may never achieve or maintain profitability.

We had a net loss of $145.7 million in the six months ended June 30, 2023, and a net loss of $126.8 million in the full year 2022.

As of June 30, 2023, we had an accumulated deficit of $727.6 million.

We had a loss in the nine months ended September 30, 2023 and year ended December 31, 2022, incurred significant losses in previous years and expect to incur losses during the current and over the next several years and may never achieve or maintain profitability.

We had a net loss of $235.3 million in the nine months ended September 30, 2023, and a net loss of $126.8 million in the full year 2022.

As of September 30, 2023, we had an accumulated deficit of $817.2 million.

In the past, we have financed our operations primarily through the sale of equity securities and convertible debt, venture loans, upfront payments from our collaboration partners and, to a lesser extent, subsidies and grants from governmental agencies and fees for services.

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We expect to continue to incur significant expenses and losses over the next several years, and our net losses may fluctuate significantly from quarter to quarter and year to year.

We anticipate that our expenses will increase for the foreseeable future and will include costs related to:

● advancing AMT-130 for our Huntington’s disease gene therapy program into phase III clinical study;

● advancing our gene therapy programs for rTLE, SOD1-ALS and Fabry disease into Phase I/II clinical studies;

● potentially acquiring or in-licensing rights to new therapeutic targets, product candidates and technologies;

● making potential future milestone payments related to the acquisition of uniQure France SAS, if any.

As a result of the Reorganization, we expect to reduce our expenses until such time that we decide to advance our gene therapy product candidates into late stage clinical development.

We may never succeed in these activities and, even if we do, may never generate revenues that are sufficient to achieve or sustain profitability.

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Our existing and any future indebtedness could adversely affect our ability to operate our business.

As of June 30, 2023, we had $100.0 million of outstanding principal of borrowings under the 2023 Amended Facility, which we are required to repay in full in January 2027.

As of September 30, 2023, we had $100.0 million of outstanding principal of borrowings under the 2023 Amended Facility, which we are required to repay in full in January 2027.

We could in the future incur additional debt obligations beyond our borrowings from Hercules.

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We face an inherent risk of product liability related to the testing of our product candidates in human clinical trials and in connection with product sales.

If we cannot successfully defend ourselves against claims that our product candidates or products caused injuries, we will incur substantial liabilities.

If we cannot successfully defend ourselves against claims that our product candidates or products or the procedures used to administer them to patients caused injuries, we will incur substantial liabilities.

Regardless of merit or eventual outcome, liability claims may result in:

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For example, the U.S.

Tax Cuts and Jobs Act of 2017 includes a provision repealing, effective January 1, 2019, the tax-based shared responsibility payment imposed by the Affordable Care Act on certain individuals who fail to maintain qualifying health coverage for all or part of a year that is commonly referred to as the "individual mandate".

Additional legislative and regulatory changes to the PPACA, its implementing regulations and guidance and its policies, remain possible in the 117 th U.S.

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The failure of any employee or other such third parties to act within the bounds of the applicable laws, regulations, agreements, codes and other requirements, or any misconduct or illegal actions or omissions by such persons, could materially damage our business.

Actions that we have taken to restructure our business in alignment with our strategic priorities may not be as effective as anticipated .

In October 2023, we commenced the Reorganization to conserve financial resources and better align our workforce with current business needs.

We may encounter challenges in the execution of these efforts, and these challenges could impact our financial results.

Although we believe that these actions will reduce operating costs, we cannot guarantee that the Reorganization will achieve or sustain the targeted benefits, or that the benefits, even if achieved, will be adequate to meet our long-term expectations.

As a result of the Reorganization, we will incur additional costs in the near term, including cash expenditures for employee transition, notice period and severance payments, employee benefits, and related facilitation costs.

Additional risks associated with the continuing impact of the Reorganization include employee attrition beyond our intended reduction in force and adverse effects on employee morale (which may also be further exacerbated by actual or perceived declining value of equity awards), diversion of management attention, adverse effects to our reputation as an employer (which could make it more difficult for us to hire new employees in the future), and potential failure or delays to meet development targets due to the loss of qualified employees.

If we do not realize the expected benefits of our restructuring efforts on a timely basis or at all, our business, results of operations and financial condition could be adversely affected.

Risks Related to Our Ordinary Shares

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Our share price has been and may in the future be volatile.

From the start of trading of our ordinary shares on the Nasdaq Global Select Market on February 4, 2014 through July 27, 2023, the sale price of our ordinary shares ranged from a high of $82.49 to a low of $4.72.

The closing price on July 27, 2023, was $9.51 per ordinary share.

The stock market in general and the market for smaller biopharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies.

From the start of trading of our ordinary shares on the Nasdaq Global Select Market on February 4, 2014 through November 2, 2023, the sale price of our ordinary shares ranged from a high of $82.49 to a low of $4.72.

The closing price on November 2, 2023, was $5.72 per ordinary share.

In recent years, the stock market in general and the market for smaller biopharmaceutical companies in particular have experienced significant price and volume fluctuations that have often been unrelated or disproportionate to changes in the operating performance of the companies whose stock is experiencing those price and volume fluctuations.

Following periods of such volatility in the market price of a company’s securities, securities class action litigation has often been brought against that company.

Because of the potential volatility of our stock price, we may become the target of securities litigation in the future.

Securities litigation could result in substantial costs and divert management’s attention and resources from our business.

The market price for our ordinary shares may be influenced by many factors, including:

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● the recruitment or departure of key personnel;

● changes to our business, including pipeline reprioritizations and restructurings;

● the level of expenses related to any of our product candidates or clinical development programs;

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● general economic, industry and market conditions;

● the other factors described in this “Risk Factors” section.

Our directors, executive officers, and major shareholders, if they choose to act together, will continue to have a significant degree of control with respect to matters submitted to shareholders for approval.

Our directors, executive officers and major shareholders holding more than 5% of our outstanding ordinary shares, in the aggregate, beneficially own approximately 37.8% of our issued shares (including such shares to be issued in relation to exercisable options to purchase ordinary shares) as of June 30, 2023.

Our directors, executive officers and major shareholders holding more than 5% of our outstanding ordinary shares, in the aggregate, beneficially own approximately 36.6% of our issued shares (including such shares to be issued in relation to exercisable options to purchase ordinary shares) as of September 30, 2023.

As a result, if these shareholders were to choose to act together, they may be able, as a practical matter, to control many matters submitted to our shareholders for approval, as well as our management and affairs.

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jurisdictions.

Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities

Defaults Upon Senior Securities

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

What changed 10-Q

Item 1A. Risk Factors