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Item 1A. Risk Factors

2022-05-04 compared with 2021-11-04 · 256 added, 233 removed, 741 unchanged (40% of the section changed)

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• Our business may be further adversely affected by the effects of the COVID-19 pandemic, including those impacting our manufacturing and supply chain operations, research and development efforts, commercial operations and sales force, administrative personnel, third-party service providers, and business partners and customers, as well as the demand for our marketed products.

• We face risks related to the development, manufacturing, and commercialization of REGEN-COV.

• We face risks related to the development, manufacturing, and commercialization of REGEN-COV and "next generation" monoclonal antibodies targeting SARS-CoV-2.

Commercialization Risks

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• Tax liabilities and risks associated with our operations outside of the United States could adversely affect our business.

• We face potential liability related to the personal information we collect from individuals, data brokers, or research institutions or obtain from clinical trials sponsored by us or our collaborators.

• We face risks related to the personal data we collect, process, and share.

Risks Related to Our Reliance on Third Parties

• If our collaborations with Sanofi or Bayer are terminated or breached, our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed.

• If our collaborations with Sanofi or Bayer or other third parties are terminated or breached, our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed.

• Our collaborators and service providers may fail to perform adequately in their efforts to support the development, manufacture, and commercialization of our drug candidates and current and future products.

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In December 2019, a novel strain of coronavirus, SARS-CoV-2, causing a disease referred to as COVID-19, was reported to have surfaced in Wuhan, China.

It has since spread around the world, including the United States;

and, in March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic.

This pandemic has adversely affected or has the potential to adversely affect, among other things, the economic and financial markets and labor resources of the countries in which we operate;

It has since spread around the world and caused a global pandemic.

This pandemic has adversely affected and/or has the potential to adversely affect, among other things, the economic and financial markets and labor resources of the countries in which we operate;

our manufacturing and supply chain operations, research and development efforts, commercial operations and sales force, administrative personnel, third-party service providers, and business partners and customers;

and the demand for our marketed products.

The COVID-19 pandemic has resulted in travel and other restrictions to reduce the spread of the disease, including governmental orders across the globe, which, among other things, direct individuals to shelter at their places of residence, direct businesses and governmental agencies to cease non-essential operations at physical locations, prohibit certain non-essential gatherings, maintain social distancing, order cessation of non-essential travel, and require proof of vaccination and/or negative COVID-19 test results.

Though some of these restrictions have eased, the continuation or recurrence of these restrictions remains uncertain and will depend on many factors, including any future spikes in COVID-19 cases and the continued availability and efficacy of vaccines and treatments.

It is expected that the pandemic will continue to ebb and flow, with different jurisdictions having higher levels of infections than others over the course of the pandemic.

In addition, new variants of the SARS-CoV-2 virus have emerged, have been shown to be present in many geographies, and appear to spread more easily and quickly than other variants.

As a result, shelter-in-place and social distancing orders, government-imposed quarantines, and work-from-home policies (which we previously implemented for a significant portion of our employees) may continue to varying degrees for the duration of the COVID-19 pandemic and may further negatively impact productivity, disrupt our business, and delay our clinical programs and development timelines beyond the delays we have already experienced and disclosed;

the magnitude of these developments will depend, in part, on the length and severity of the restrictions and other limitations on our ability to conduct our business in the ordinary course.

The COVID-19 pandemic has resulted in the imposition of various restrictions and mandates around the world to reduce the spread of the disease, including governmental orders that direct individuals to shelter at their places of residence, direct businesses and governmental agencies to cease non-essential operations at physical locations, prohibit certain non-essential gatherings, maintain social distancing, order cessation of non-essential travel, and require proof of vaccination and/or negative COVID-19 test results.

The COVID-19 pandemic has continued to ebb and flow, with different jurisdictions having higher levels of infections than others and new variants of the SARS-CoV-2 virus (such as the Omicron-lineage variants) emerging and spreading more easily and quickly than other variants.

The trajectory and the ultimate impact of the pandemic are highly uncertain and subject to change and we do not yet know the full extent of potential delays or impacts on our business, our clinical trials, healthcare systems, or the global economy as a whole.

These effects could have a material impact on our operations.

By way of example, continuation or re-imposition of various government-imposed or private-sector measures relating to the COVID-19 pandemic (including those we previously implemented, such as work-from-home policies for some employees) may further negatively impact productivity, disrupt our business, and delay our clinical programs and development timelines beyond the delays we have already experienced and disclosed.

Such restrictions and limitations may also further negatively impact our access to regulatory authorities (which are affected, among other things, by applicable travel restrictions and may be delayed in responding to inquiries, reviewing filings, and conducting inspections);

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and our ability to obtain services from third-party specialty vendors and other providers or to access their expertise as fully and timely as needed.

The COVID-19 pandemic may also result in the loss of

some of our key personnel, either temporarily or permanently.

We and our employees may also be subject to government vaccine mandates, such as President Biden's recent Executive Order entitled "Executive Order on Ensuring Adequate COVID Safety Protocols for Federal Contractors" applicable to certain federal contractors (which we expect to become effective for us on December 8, 2021).

Any such requirement may have a negative impact on our ability to retain employees or hire new employees and could adversely impact our business.

The COVID-19 pandemic may also result in the loss of some of our key personnel, either temporarily or permanently.

We and our employees may also be subject to government vaccine mandates, which may have a negative impact on our ability to retain employees or hire new employees and could adversely impact our business.

In addition, our sales and marketing efforts were previously negatively impacted and may be further negatively impacted by postponement or cancellation of face-to-face meetings and restrictions on access by non-essential personnel to hospitals or clinics to the extent such measures slow down adoption or further commercialization of our marketed products.

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These and similar, and perhaps more severe, disruptions in our operations may materially adversely impact our business, operating results, and financial condition.

Quarantines, shelter-in-place, social distancing, and similar government orders (or the perception that such orders, shutdowns, or other restrictions on the conduct of business operations could occur) related to COVID-19 previously impacted, and may impact in the future, personnel at our research and manufacturing facilities, our suppliers, and other third parties on which we rely, as well as the availability or cost of materials produced by or purchased from such parties, resulting in supply chain strains or disruptions that may become material.

While some materials and services may be obtained from more than one supplier or provider, port closures and other restrictions resulting from the COVID-19 pandemic (including any government restrictions or limitations, such as those that may be imposed under the Defense Production Act) could materially disrupt our supply chain or limit our ability to obtain sufficient materials or services (including fill/finish services) required for the development and manufacturing of our products and product candidates as well as our research efforts.

Various government-imposed or private-sector measures relating to the COVID-19 pandemic (or the perception that such restrictions or limitations on the conduct of business operations could occur) previously impacted, and may impact in the future, personnel at our research and manufacturing facilities, our suppliers, and other third parties on which we rely, as well as the availability or cost of materials produced by or purchased from such parties, resulting in supply chain strains or disruptions that may become material.

While some materials and services may be obtained from more than one supplier or provider, port closures and other restrictions, whether resulting from the COVID-19 pandemic or otherwise (including any government restrictions or limitations, such as those that may be imposed under the Defense Production Act), could materially disrupt our supply chain or limit our ability to obtain sufficient materials or services (including fill/finish services) required for the development and manufacturing of our products and product candidates as well as our research efforts.

If microbial, viral (including COVID-19), or other contaminations are discovered in our products, product candidates, the materials used for their production, or in our facilities, or in the facilities of our collaborators, third-party contract manufacturers, or other providers or suppliers, the affected facilities may need to be closed or may otherwise be affected for an extended period of time, or the contamination may result in other delays or disruptions in our direct or indirect supply chain.

In addition, infections and deaths related to COVID-19 previously disrupted and may in the future disrupt the United States' healthcare and healthcare regulatory systems.

In addition, infections, hospitalizations, and deaths related to COVID-19 previously disrupted and may in the future disrupt the United States' healthcare and healthcare regulatory systems.

Such disruptions could divert healthcare resources away from, or materially delay, FDA review and potential approval of our product candidates and new indications for our marketed products.

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In addition, a recession or market correction resulting from the spread of COVID-19 could materially affect our business and the value of our Common Stock.

The global COVID-19 pandemic continues to rapidly evolve.

The ultimate impact of this pandemic is highly uncertain and subject to change.

We do not yet know the full extent of potential delays or impacts on our business, our clinical trials, healthcare systems, or the global economy as a whole.

These effects could have a material impact on our operations.

To the extent the COVID-19 pandemic adversely affects our business, prospects, operating results, or financial condition, it may also have the effect of heightening many of the other risks described in this "Risk Factors" section.

We face risks related to the development, manufacturing, and commercialization of REGEN-COV.

In response to the recent global outbreak of COVID-19, we developed and are manufacturing and commercializing, in collaboration with Roche, REGEN-COV (known as Ronapreve in other countries outside the United States), a novel investigational antibody cocktail treatment designed to prevent and treat infection from the SARS-CoV-2 virus that received an

EUA from the FDA in November 2020.

There can be no assurance with respect to how long the EUA will remain in effect, whether the EUA will be further expanded (such as to include the treatment of hospitalized COVID-19 patients) based on new clinical trial results or otherwise, and whether the EUA will be revoked by the FDA based on its determination that the underlying health emergency no longer exists or warrants such authorization or other reasons (including if REGEN-COV is found to be less effective or not effective against new variants of the SARS-CoV-2 virus).

In addition, there are multiple ongoing clinical trials (as discussed in Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations – Programs in Clinical Development") evaluating the safety and efficacy of the antibody cocktail and there is no assurance of favorable results from any ongoing or future clinical trials, the timing of their completion, or the FDA's or other regulatory authorities' favorable determinations based on data from any such clinical trial.

It is also possible that the FDA and certain other regulatory authorities may not grant the antibody cocktail full marketing approval for the treatment of COVID-19, or that any such marketing approvals, if granted, may have significant limitations on its use.

Further, other parties may be successful in developing a more efficacious, more easily administered, more cost-effective, or otherwise superior treatment for COVID-19;

and utilization of REGEN-COV has been and may in the future be adversely impacted by other factors, such as the rollout of vaccines providing acquired immunity against COVID-19 and the distribution model for REGEN-COV or other treatments for COVID-19.

Any of these factors may negatively impact the uptake or commercialization of REGEN-COV, and such impact may be material.

The intense public interest, including speculation by the media, in the development and commercialization of REGEN-COV has caused or contributed to significant volatility in our stock price, which may continue as data and other information from the ongoing and any future clinical trials evaluating REGEN-COV and third-party product candidates for the treatment or prevention of COVID-19 as well as any other regulatory actions become public.

We also face risks related to our significant investment in the development, supply, allocation, distribution, pricing, and commercialization of REGEN-COV.

Given the severity and urgency of the COVID-19 pandemic, we have committed significant capital and resources to fund and supply clinical trials and to accelerate and scale up the production of REGEN-COV, which involves a complex manufacturing process that is both resource- and time-sensitive.

We expect our investment in the development and manufacture of REGEN-COV to continue through 2021 and potentially beyond, although the magnitude of our investment will be subject to clinical data results, the duration of the COVID-19 pandemic, and other factors, including regulatory outcomes.

If we are unable to maintain the EUA or obtain regulatory approvals, or if we make a strategic decision to discontinue development of REGEN-COV or are otherwise not successful in the commercialization of REGEN-COV, we may be unable to recoup our significant expenses incurred to date and/or in the future related to the development and production of REGEN-COV.

While we previously recognized significant net product sales and collaboration revenue in connection with sales of REGEN-COV and expect to recognize additional significant net product sales under the September 2021 amended supply agreement with the U.S.

government, the degree to which future sales of REGEN-COV will continue to impact our results of operations is highly uncertain.

In addition, our internal and contracted manufacturing capacity may not be sufficient to cover the demand for REGEN-COV.

While we have entered into a collaboration agreement with Roche to develop, manufacture, and distribute REGEN-COV, we cannot be certain that our current manufacturing and distribution capacity for REGEN-COV and the increased manufacturing and distribution capacity through our collaboration with Roche will be sufficient.

In addition, we rely entirely on third parties for filling and finishing services for REGEN-COV.

We face risks related to the development, manufacturing, and commercialization of REGEN-COV and "next generation" monoclonal antibodies targeting SARS-CoV-2.

In response to the COVID-19 pandemic, we developed REGEN-COV (known as Ronapreve in other countries outside the United States), a novel investigational antibody cocktail treatment designed to prevent and treat infection from the SARS-CoV-2 virus.

REGEN-COV received an EUA from the FDA in November 2020 for the treatment of mild to moderate COVID-19 in certain patients.

However, based on laboratory data that showed markedly decreased binding to the Omicron spike protein, REGEN-COV is highly unlikely to be active against the Omicron-lineage variants.

In January 2022, the FDA revised the EUA to exclude its use in geographic regions where, based on available information including variant susceptibility and regional variant frequency, infection or exposure is likely due to a variant such as an Omicron-lineage variant that is not susceptible to the treatment.

With this EUA revision, REGEN-COV is not currently authorized for use in any U.S.

states, territories, or jurisdictions, since Omicron-lineage variants are currently dominant across the United States.

In light of these developments, we cannot predict whether (if at all) or to what extent REGEN-COV may be reauthorized for use by the FDA in any such jurisdictions in the future.

In addition, there can be no assurance with respect to how long the EUA will remain in effect or whether the EUA will be further revised or revoked by the FDA based on its determination that the underlying health emergency no longer exists or warrants such authorization or other reasons.

Similar limitations on the use of REGEN-COV may also be imposed by foreign regulatory authorities in jurisdictions where REGEN-COV is currently authorized for use.

It is also possible that the FDA and certain other regulatory authorities may not grant REGEN-COV full marketing approval for the treatment or prevention of COVID-19, or that any such marketing approvals, if granted, may have similar or other significant limitations on its use.

Further, besides currently available therapeutic and prevention options for COVID-19, additional products for treatment or prevention of COVID-19 that are more efficacious, more easily administered, more cost-effective, or otherwise superior may be successfully developed;

and utilization of REGEN-COV previously was, and any future utilization may be, adversely impacted by other factors, such as the widespread availability of vaccines providing acquired immunity against COVID-19, other products for treatment or prevention of COVID-19, or the distribution model for REGEN-COV.

Any of these factors may further negatively impact any potential future uptake or commercialization of REGEN-COV, and such impact may be material.

The intense public interest, including speculation by the media, in the development and commercialization of monoclonal antibodies and other products for treatment or prevention of COVID-19 has caused or contributed to significant volatility in our stock price, which may continue as data and other information from any studies evaluating REGEN-COV (whether conducted by us or others), our "next generation" monoclonal antibodies targeting SARS-CoV-2 discussed below, and third-party product candidates for the treatment or prevention of COVID-19 as well as any other regulatory actions become public.

We are also subject to similar risks in connection with the development and potential commercialization of any such "next generation" monoclonal antibodies.

In addition to our REGEN-COV program, we are progressing "next generation" monoclonal antibodies targeting SARS-CoV-2 that are active against Omicron, Delta, and other variants, and have initiated a first-in-human trial of one of these "next generation" antibodies.

There can be no assurance as to the timing or success of this study or any future studies evaluating "next generation" antibodies and whether any of such antibodies will retain activity against present or future variants of concern.

We also face risks related to our significant investment in the development, supply, allocation, distribution, pricing, and commercialization of REGEN-COV and our "next generation" monoclonal antibodies (together with REGEN-COV referred to below as "our COVID-19 monoclonal antibodies").

Given the severity and urgency of the COVID-19 pandemic, we have committed and may continue to commit significant capital and resources to fund and supply clinical trials and to accelerate and scale up the production of our COVID-19 monoclonal antibodies, which involves a complex manufacturing process that is both resource- and time-sensitive.

We expect our investment in the development and manufacture of our COVID-19 monoclonal antibodies to continue through 2022 and potentially beyond, although the magnitude of our investment will be subject to clinical data results, the duration of the COVID-19 pandemic, and other factors, including regulatory outcomes.

If we are unable to obtain a new EUA for any of our "next generation" monoclonal antibodies, or obtain regulatory approvals for any of the foregoing, or if we make a strategic decision to discontinue development of, or not commercialize, our COVID-19 monoclonal antibodies or are otherwise not successful in their commercialization, we may be unable to recoup our significant expenses incurred to date and/or in the future related to the development and production of our COVID-19 monoclonal antibodies.

While we previously recognized significant revenues in connection with sales of REGEN-COV, the degree to which future sales of our COVID-19 monoclonal antibodies will continue to impact our results of operations is highly uncertain.

In addition, our internal and contracted manufacturing capacity may not be sufficient to cover any potential future demand for our COVID-19 monoclonal antibodies.

While we have entered into a collaboration agreement with Roche to develop, manufacture, and distribute outside the United States REGEN-COV, we cannot be certain that our current manufacturing and distribution capacity for REGEN-COV and the increased manufacturing and distribution capacity through our collaboration with Roche will be sufficient if there is significant future demand for REGEN-COV.

In addition, we rely entirely on third parties for filling and finishing services for REGEN-COV and, in the future, may rely entirely on such providers for filling and

finishing services for our other COVID-19 monoclonal antibodies.

Our third-party fill/finish providers may not have sufficient capacity or may otherwise not be able to provide such services on a timely basis in the quantities requested (such as because they devote their capacity to other drugs or vaccines against COVID-19), which we previously experienced.

The ability of our third-party providers to deliver such services to us may further be adversely impacted by the imposition of government restrictions or limitations (including those that may be imposed under the Defense Production Act).

If we are unable to timely enter into alternative arrangements, or if such alternative arrangements are not available on satisfactory terms or at all, we may experience delays in the development, manufacturing, and distribution of REGEN-COV.

We and Roche also face challenges related to the allocation of existing and future supply of REGEN-COV, particularly with respect to geographic distribution.

As supplies of REGEN-COV are expected to remain constrained, it is possible that the U.S.

government may limit or restrict our and/or Roche's ability to distribute and commercialize REGEN-COV outside of the United States.

In addition, as a result of the emergency situations in many countries, there is a heightened risk that REGEN-COV may be subject to adverse governmental actions in certain countries.

We and Roche have faced and may in the future face additional challenges related to the allocation of supply of REGEN-COV and other COVID-19 monoclonal antibodies (as applicable), particularly with respect to geographic distribution.

For example, if supplies of REGEN-COV are constrained in response to future demand, it is possible that the U.S.

government may limit or restrict our and/or Roche's ability to distribute and commercialize REGEN-COV outside the United States.

In addition, as a result of the emergency situations in many countries, there is a heightened risk that products for treatment or prevention of COVID-19 may be subject to adverse governmental actions in certain countries.

government may exercise or assert certain rights with respect to our inventions, products, or product candidates.

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For example, our July 2020 agreement with the U.S.

government to manufacture and deliver REGEN-COV to the U.S.

government gives the U.S.

government relating to REGEN-COV gives the U.S.

government, among other rights, the right to require us to grant a non-exclusive license to applicable inventions to a third party if such action is deemed necessary to alleviate certain health or safety needs.

This right may be triggered if we, for example, do not manufacture or supply sufficient product to address such needs.

government exercises or asserts any such rights or imposes these or similar measures with respect to our products, product candidates, or related inventions (including REGEN-COV), it may adversely impact our business and results of operations.

government exercises or asserts any such rights or imposes these or similar measures with respect to our products, product candidates, or related inventions (including our COVID-19 monoclonal antibodies), it may adversely impact our business and results of operations.

Foreign governments (including the government of Ireland, where we have manufacturing facilities) may have similar rights or attempt to assert any such rights.

Further, we have observed and are likely to continue to face significant public attention and scrutiny over the complex decisions made regarding the REGEN-COV development program, including any allocation, distribution, or pricing decisions with respect to REGEN-COV.

Further, we have observed and are likely to continue to face significant public attention and scrutiny over the complex decisions made regarding the development program for our COVID-19 monoclonal antibodies, including any allocation, distribution, or pricing decisions.

If we are unable to successfully manage these risks, we could face significant reputational harm, which could, among other adverse consequences, negatively affect our stock price.

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EYLEA net sales represent a substantial portion of our revenues and this concentration of our net sales in a single product makes us substantially dependent on that product.

For the nine months ended September 30, 2021 and 2020, EYLEA net sales in the United States represented 38% and 59% of our total revenues, respectively, with EYLEA net sales as a percentage of our total revenues for the nine months ended September 30, 2021 being significantly lower due to the net product sales of REGEN-COV we recorded in that period in connection with deliveries of drug product under our agreements with the U.S.

For the three months ended March 31, 2022 and 2021, EYLEA net sales in the United States represented 51% and 53% of our total revenues, respectively.

If we were to experience difficulty with the commercialization of EYLEA in the United States or if Bayer were to experience any difficulty with the commercialization of EYLEA outside the United States (including as a result of the COVID-19 pandemic discussed above), or if we and Bayer are unable to maintain current marketing approvals of EYLEA, we may experience a reduction in revenue and may not be able to sustain profitability, and our business, prospects, operating results, and financial condition would be materially harmed.

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• our ability and our collaborators' ability to maintain sales of our marketed products in the face of competitive products and to differentiate our marketed products from competitive products, including as applicable product candidates currently in clinical development;

and, in the case of EYLEA, the existing and potential new competition for EYLEA (discussed further under " The commercial success of our products and product candidates is subject to significant competition - Marketed Products" below) and the willingness of retinal specialists and patients to start or continue treatment with EYLEA or to switch from another product to EYLEA;

and, in the case of EYLEA, the existing and potential new branded and biosimilar competition for EYLEA (discussed further under " The commercial success of our products and product candidates is subject to significant competition - Marketed Products" below) and the willingness of retinal specialists and patients to start or continue treatment with EYLEA or to switch from another product to EYLEA;

• the effect of existing and new health care laws and regulations currently being considered or implemented in the United States, including price reporting and other disclosure requirements of such laws and regulations and the potential impact of such requirements on physician prescribing practices and payor coverage;

• serious complications or side effects in connection with the use of our marketed products, as discussed under "Risks Related to Maintaining Approval of Our Marketed Products and the Development and Obtaining Approval of Our Product Candidates and New Indications for Our Marketed Products - Serious complications or side effects in connection with the use of our products and in clinical trials for our product candidates and new indications for our marketed products could cause our regulatory approvals to be revoked or limited or lead to delay or discontinuation

of development of our product candidates or new indications for our marketed products, which could severely harm our business, prospects, operating results, and financial condition " below;

• maintaining and successfully monitoring commercial manufacturing arrangements for our marketed products with third parties who perform fill/finish or other steps in the manufacture of such products to ensure that they meet our standards and those of regulatory authorities, including the FDA, which extensively regulate and monitor pharmaceutical manufacturing facilities;

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Sales of our marketed products in other countries are dependent, in large part, on similar reimbursement mechanisms and programs in those countries.

Our future revenues and profitability will be adversely affected in a material manner if such third-party payors do not adequately defray or reimburse the cost of our marketed products to patients.

Our future revenues and profitability will be adversely affected in a material manner if such third-party payors do not adequately defray or reimburse the cost of our marketed products.

If these entities do not provide coverage and reimbursement with respect to our marketed products or provide an insufficient level of coverage and reimbursement, such products may be too costly for many patients to afford them, and physicians may not prescribe them.

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Third-party payors may also require prior authorization for reimbursement, or require failure on another type of treatment before covering a particular drug, particularly with respect to higher-priced drugs.

As our currently marketed products and most of our product candidates are biologics, bringing them to market may cost more than bringing traditional,

small-molecule drugs to market due to the complexity associated with the research, development, production, supply, and regulatory review of such products.

Given cost sensitivities in many health care systems (which will likely be exacerbated as a result of the COVID-19 pandemic), our currently marketed products and product candidates are likely to be subject to continued pricing pressures, which may have an adverse impact on our business, prospects, operating results, and financial condition.

As our currently marketed products and most of our product candidates are biologics, bringing them to market may cost more than bringing traditional, small-molecule drugs to market due to the complexity associated with the research, development, production, supply, and regulatory review of such products.

Given cost sensitivities in many health care systems (which may continue to be exacerbated as a result of the COVID-19 pandemic), our currently marketed products and product candidates are likely to be subject to continued pricing pressures, which may have an adverse impact on our business, prospects, operating results, and financial condition.

In addition, in order for private insurance and governmental payors (such as Medicare and Medicaid in the United States) to reimburse the cost of our marketed products, we must maintain, among other things, our FDA registration and our National Drug Code, formulary approval by PBMs, and recognition by insurance companies and the Centers for Medicare & Medicaid Services (the "CMS").

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Government and other third-party payors (including PBMs) are challenging the prices charged for healthcare products and increasingly limiting, and attempting to limit, both coverage and level of reimbursement for prescription drugs, such as by requiring outcomes-based or other pay-for-performance pricing arrangements.

, requiring the use of less costly medications before more costly medications are approved for coverage).

They are also imposing restrictions on eligible patient populations and the reimbursement process, including by means of required prior authorizations and utilization management criteria, such as step therapy (i.e., requiring the use of less costly medications before more costly medications are approved for coverage).

Some states are also considering legislation that would control the prices and reimbursement of prescription drugs, and state Medicaid programs are increasingly requesting manufacturers to pay supplemental rebates and requiring prior authorization by the state program for use of any prescription drug for which supplemental rebates are not being paid.

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Congress have indicated that lowering drug prices continues to be a legislative and political priority, as evidenced, for example, by the "Executive Order on Promoting Competition in the American Economy" issued by President Biden in July 2021.

Proposals aimed at drug pricing introduced at the federal level include measures that would index the price of certain drugs (including those covered by Medicare Part B, such as EYLEA) using international or domestic reference pricing mechanisms, allow the government to negotiate prescription drug prices for Medicare and potentially other third-party payors, and permit the importation of drugs from other countries into the United States at lower prices.

The main proposal aimed at drug pricing introduced at the federal level as part of the "Build Back Better Act" (portions of which may be enacted into law even if the entire bill is not) includes measures that would allow the government to negotiate prices of certain prescription drugs under Medicare (including those covered under Medicare Part B, such as EYLEA) and would redesign the Medicare Part D benefit to limit patient out-of-pocket drug costs and shift liabilities among stakeholders, including manufacturers.

At the state level, legislatures are becoming increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, and price and marketing cost disclosure and transparency measures.

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Economic pressure on state budgets may also have a similar impact.

In addition, PBMs often develop formularies to reduce their cost for medications.

In addition, PBMs and other managed-care organizations often develop formularies to reduce their cost for medications.

The breadth of the products covered by formularies varies considerably from one PBM to another.

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For example, the EU provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use.

A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the

company placing the medicinal product on the market.

A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market.

Our results of operations may suffer if we or our collaborators are unable to market our products in foreign countries or if coverage and reimbursement for our marketed products in foreign countries is limited or delayed.

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Many of our competitors have substantially greater research, preclinical and clinical product development and manufacturing capabilities, as well as financial, marketing, and human resources, than we do.

Our smaller competitors may also enhance their competitive position if they acquire or discover patentable inventions, form collaborative arrangements, or merge with larger pharmaceutical or biotechnology companies.

Our competitors, regardless of their size, may also enhance their competitive position if they acquire or discover patentable inventions, form collaborative arrangements, or merge with other pharmaceutical or biotechnology companies.

There is significant actual and potential future competition for each of our marketed products.

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and Biogen Inc.'s biosimilar referencing Lucentis.

In addition, Genentech/Roche recently announced the approval of Vabysmo ™ (faricimab-svoa), a bispecific antibody targeting both VEGF and Ang2, for the treatment of wet AMD and DME in the United States.

Ophthalmologists are also using off-label, third-party repackaged versions of Genentech/Roche's approved VEGF antagonist, bevacizumab, for the treatment of certain of EYLEA's indications, and we are aware of another company developing an ophthalmic formulation of such product.

In DME and RVO, EYLEA also competes with intravitreal implants of corticosteroids.

We are also aware of a number of companies working on the development of product candidates and extended delivery devices for the potential treatment of one or more of EYLEA's indications, including those that act by blocking VEGF and VEGF receptors (including therapies designed to extend the treatment interval) and/or other targets (such as Ang2).

In addition, we are aware of several companies developing biosimilar versions of EYLEA and other approved anti-VEGF treatments, including other biosimilar versions of Lucentis under regulatory review or in late-stage clinical development.

and VEGF receptors (including therapies designed to extend the treatment interval) and/or other targets.

In addition, we are aware of several companies developing biosimilar versions of EYLEA and other approved anti-VEGF treatments.

Other potentially competitive products in development include products for use in combination with EYLEA and/or other anti-VEGF treatments, small-molecule tyrosine kinase inhibitors, gene therapies, and other eye-drop formulations, devices, and oral therapies.

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In atopic dermatitis, there are several topical ointments or agents either approved or in development.

There are also systemic JAK inhibitors and an antibody against IL-13 approved for atopic dermatitis and others are in development.

In addition, a number of companies are developing antibodies against IL-13Ra1, OX40, IL-31R, and/or IL-1alpha.

In asthma, competitors to Dupixent include antibodies against the IL-5 ligand or the IL-5 receptor or immunoglobulin E;

There are also topical and systemic JAK inhibitors and an antibody against IL-13 approved for atopic dermatitis and others are in development.

In addition, a number of companies are developing antibodies against IL-4Ra, IL-13Ra1, OX40, and/or IL-31R.

In asthma, competitors to Dupixent include antibodies against the IL-5 ligand or the IL-5 receptor, immunoglobulin E, or thymic stromal lymphopoietin ("TSLP");

and some of these antibodies are either approved or in development for indications that also compete or may compete in the future with Dupixent in CRSwNP.

There are several other potentially competitive products in development that may compete with Dupixent in asthma, as well as potential future indications, including antibodies against thymic stromal lymphopoietin ("TSLP") or IL-33 ligand or receptor.

Dupixent also faces competition from inhaled products in asthma and potential future indications.

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Product Candidates

Our VelocImmune ® technology, other antibody generation technologies, and late-stage and earlier-stage clinical candidates face competition from many pharmaceutical and biotechnology companies using various technologies, including antibody generation technologies and other approaches such as RNAi and chimeric antigen receptor T cell (CAR-T cell) technologies.

Our VelocImmune technology, other antibody generation technologies, and late-stage and earlier-stage clinical candidates face competition from many pharmaceutical and biotechnology companies using various technologies, including antibody generation technologies and other approaches such as RNAi, chimeric antigen receptor T cell (CAR-T cell), and gene therapy technologies.

For example, we are aware of other pharmaceutical and biotechnology companies actively engaged in the research and development of antibody-based products against targets that are also the targets of our early- and late-stage product candidates.

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As a result, we rely in part on Sanofi's sales and marketing organization in the United States for these products.

If we and Sanofi fail to coordinate our United States sales and marketing efforts effectively, sales of any of such products may be materially affected.

If we and Sanofi fail to coordinate our United States sales and marketing efforts effectively,

sales of any of such products may be materially affected.

Sanofi also maintains other important responsibilities relating to Dupixent in the United States.

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We also rely on Sanofi for sales, marketing, and distribution of Dupixent and Libtayo in countries outside the United States.

While we exercised our options under the Antibody Collaboration and the IO Collaboration to co-commercialize Dupixent and Libtayo in certain jurisdictions outside the United States and have commenced this co-commercialization with respect to Dupixent, we will continue to rely in part on Sanofi's sales and marketing organization in such jurisdictions and there can be no assurance that we will be able to successfully conduct such co-commercialization in the expected time frame or at all.

While we exercised our option under the Antibody Collaboration to co-commercialize Dupixent in certain jurisdictions outside the United States and have commenced this co-commercialization, we will continue to rely in part on Sanofi's sales and marketing organization in such jurisdictions and there can be no assurance that we will be able to successfully conduct such co-commercialization in the expected time frame or at all.

If we and our collaborators are unsuccessful in continuing to commercialize the marketed products subject to such collaborations, or if Bayer or Sanofi terminate their respective collaborations with us, our business, prospects, operating results, and financial condition would be materially impaired.

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Therefore, termination of the Bayer collaboration agreement, our Antibody Collaboration, or our IO Collaboration would create substantial new and additional risks to the successful commercialization of the applicable products, particularly outside the United States.

For additional information regarding our collaborations with Bayer and Sanofi, see "Risks Related to Our Reliance on Third Parties - If our collaboration with Bayer for EYLEA is terminated, or Bayer materially breaches its obligations thereunder, our business, prospects, operating results, and financial condition, and our ability to continue to develop EYLEA and commercialize EYLEA outside the United States in the time expected, or at all, would be materially harmed " below and "Risks Related to Our Reliance on Third Parties - If our Antibody Collaboration or our IO Collaboration with Sanofi is terminated, our business, prospects, operating results, and financial condition, and our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed " below.

For additional information regarding our collaborations with Bayer and Sanofi, see "Risks Related to Our Reliance on Third Parties - If our collaboration with Bayer for EYLEA is terminated, or Bayer materially breaches its obligations thereunder, our business, prospects, operating results, and financial condition, and our ability to continue to commercialize EYLEA outside the United States would be materially harmed " below and "Risks Related to Our Reliance on Third Parties - If our Antibody Collaboration or our IO Collaboration with Sanofi is terminated, or Sanofi materially breaches its obligations thereunder, our business, prospects, operating results, and financial condition, and our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed " below.

Sales of our marketed products recorded by us and our collaborators could be reduced by imports from countries where such products may be available at lower prices.

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Similarly, under our Antibody Collaboration and IO Collaboration with Sanofi, pricing and reimbursement for the products commercialized or co-commercialized thereunder outside the United States are the responsibility of Sanofi.

Prices for our marketed products in jurisdictions outside

the United States are based on local market economics and competition and are likely to differ from country to country.

Prices for our marketed products in jurisdictions outside the United States are based on local market economics and competition and are likely to differ from country to country.

In the United States, prices for pharmaceuticals are generally higher than in the bordering nations of Canada and Mexico and sales of our marketed products in the United States may be reduced if the applicable product marketed in those bordering nations is imported into the United States.

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We sell our marketed products for which we record net product sales in the United States to several distributors and specialty pharmacies, as applicable, which generally sell the product directly to healthcare providers or other pharmacies (as applicable).

For the nine months ended September 30, 2021 and 2020, our gross product sales of such products to two customers accounted on a combined basis for 53% and 86% of our total gross product revenue, respectively, and gross product sales of REGEN-COV to the U.S.

government accounted for an additional 38% of our gross product revenue in this period in 2021.

We expect this significant customer concentration to continue for the foreseeable future.

For the three months ended March 31, 2022 and 2021, our gross product sales of such products to two customers accounted on a combined basis for 85% and 75% of our total gross product revenue, respectively.

We expect significant customer concentration to continue for the foreseeable future.

Our ability to generate and grow sales of these products will depend, in part, on the extent to which our distributors and specialty pharmacies are able to provide adequate distribution of these products to healthcare providers.

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There may be other circumstances in which we need to establish commercial capabilities outside the United States, including because we decide to commercialize a particular product independently;

we are unable to find an appropriate

collaborator;

we are unable to find an appropriate collaborator;

or our existing collaborator decides not to opt in, decides to opt out, or breaches its obligations to us with respect to a particular product.

In order to commercialize or co-commercialize any products outside the United States, we must build our sales, marketing, distribution, managerial, and other non-technical capabilities in the relevant markets or make arrangements with third parties to perform these services, any of which will likely be expensive and time consuming and could delay product launch or the co-commercialization of a product in one or more markets outside the United States.

We cannot be certain that we will be able to successfully develop commercial capabilities outside the United States (including as it relates to Dupixent and Libtayo) within an acceptable time frame, without incurring substantial expenses, or at all.

We cannot be certain that we will be able to successfully develop commercial capabilities outside the United States (including as it relates to Dupixent) within an acceptable time frame, without incurring substantial expenses, or at all.

These and other difficulties relating to commercializing our products outside the United States may severely harm our business, prospects, operating results, and financial condition.

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If we or our collaborators do not maintain regulatory approval for our marketed products, and obtain regulatory approval for our product candidates or new indications for our marketed products, we will not be able to market or sell them, which would materially and negatively impact our business, prospects, operating results, and financial condition.

We cannot sell or market products without regulatory approval.

We cannot sell or market products without regulatory approval or other authorization.

If we or our collaborators do not maintain regulatory approval for our marketed products, and obtain regulatory approval for our product candidates or new indications of our marketed products (or are materially delayed in doing so), the value of our Company and our business, prospects, operating results, and financial condition may be materially harmed.

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In the United States, we (which, for purposes of this risk factor, includes our collaborators, unless otherwise stated or required by the context) must obtain and maintain approval from the FDA for each drug we intend to sell.

Obtaining FDA approval is typically a lengthy and expensive process, and approval is highly uncertain.

Obtaining FDA approval is

typically a lengthy and expensive process, and approval is highly uncertain.

We cannot predict with certainty if or when we might submit for regulatory approval for any of our product candidates currently under development.

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We may need to rely on third parties to provide companion diagnostics for use with our product candidates.

Such third parties may be unable or unwilling on terms acceptable to us to provide such companion diagnostics or to obtain timely regulatory approval of such companion diagnostics, which could negatively impact regulatory approval of our product candidates or may result in increased development costs or delays.

Such third parties may be unable or unwilling on terms acceptable to us to provide such companion diagnostics or to obtain timely regulatory approval of or product labeling updates for such companion diagnostics, which could negatively impact regulatory approval of our product candidates or may result in increased development costs or delays.

The FDA may also require us to conduct additional clinical trials after granting approval of a product.

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Procedures that are equivalent in scope, but which can vary widely in application, apply in foreign countries.

The FDA and comparable foreign regulatory authorities enforce GCPs and other regulations and legal requirements through periodic inspections of trial sponsors, clinical research organizations ("CROs"), principal investigators, and trial sites.

The FDA and comparable foreign regulatory authorities enforce Good Clinical Practice requirements ("GCPs") and other regulations and legal requirements through periodic inspections of trial sponsors, clinical research organizations ("CROs"), principal investigators, and trial sites.

If we or any of the third parties conducting our clinical studies are determined to have failed to fully comply with GCPs, the study protocol or applicable regulations, the clinical data generated in those studies may be deemed unreliable.

For example, as previously disclosed, we were recently notified by the sponsor of a trial evaluating REGEN-COV in hospitalized patients with severe COVID-19 of a GCP inspection of the trial that found certain deviations from GCP compliance.

There can be no assurance that the data from this trial will be found acceptable by the FDA or other regulatory authorities or will be sufficient for purposes of our request to expand the EUA for REGEN-COV to include COVID-19 treatment for appropriate hospitalized patients.

This and similar instances of non-compliance with GCPs could result in non-approval of our product candidates by the FDA or foreign regulatory authorities such as the EC, or we or the FDA or such other regulatory authorities may decide to conduct additional inspections or require additional clinical studies, which would delay our development programs, require us to incur additional costs, and could substantially harm our business, prospects, operating results, and financial condition.

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grant similar powers to the competent authorities and impose similar obligations on companies.

In addition to the standard drug approval process, the FDA has the authority to grant an EUA to allow unapproved medical products to be used in an emergency to diagnose, treat, or prevent serious or life-threatening diseases or conditions when, based on the totality of scientific evidence, there is evidence of effectiveness of the medical product, and there are no adequate, approved, and available alternatives.

In addition to the standard drug approval process, the Secretary of HHS may authorize the issuance of, and the FDA Commissioner may issue, an EUA to allow an unapproved medical product to be used in an emergency based on criteria established by the Food, Drug, and Cosmetic Act, including that the product at issue may be effective in diagnosing, treating, or preventing serious or life-threatening diseases when there are no adequate, approved, and available alternatives.

For example, REGEN-COV has been authorized for use in certain individuals in the United States based on an EUA from the FDA.

However, the FDA may revoke this EUA (or any other EUA we may be granted in the future) if it is determined that the underlying health emergency no longer exists or warrants such authorization;

therefore, we cannot predict how long this EUA (or any other EUA we may be granted in the future) will remain in effect.

Such revocation could adversely impact our business in a variety of ways, including by having to absorb related manufacturing and overhead costs as well as potential inventory write-offs if regulatory approval is not obtained timely or at all.

An EUA terminates when the emergency determination underlying the EUA terminates.

The FDA may also revoke, revise, or restrict an EUA for a variety of reasons, including where it is determined that the underlying health emergency no longer exists or warrants such authorization or the medical product is no longer effective in diagnosing, treating, or preventing the underlying health emergency.

For example, in January 2022, the FDA revised the EUA for REGEN-COV to exclude its use in geographic regions where, based on available information including variant susceptibility and regional variant frequency, infection or exposure is likely due to a variant such as an Omicron-lineage variant that is not susceptible to the treatment.

With this EUA revision, REGEN-COV is not currently authorized for use in any U.S.

states, territories, or jurisdictions, since Omicron-lineage variants are currently dominant across the United States.

Any such termination, revocation, or revision of an EUA could adversely impact our business in a variety of ways, including by having to absorb related manufacturing and overhead costs as well as potential inventory write-offs if regulatory approval is not obtained timely or at all.

For example, during the fourth quarter of 2021, we recorded a charge of $231.7 million to write down REGEN-COV inventory.

In addition to the FDA and other regulatory agency regulations in the United States, we are subject to a variety of foreign regulatory requirements governing human clinical trials, manufacturing, marketing and approval of drugs, and commercial sale and distribution of drugs in foreign countries.

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In addition, actions by a regulatory agency in a country or region with respect to a product candidate may have an impact on the approval process for that product candidate in another country or region.

Foreign regulatory authorities often also have the authority to require post-approval studies, such as a post-authorization safety study ("PASS") and/or post-authorization efficacy study ("PAES"), which involve various risks similar to those described above, and may ask for additional data in order to begin a clinical study including phase 3 clinical trials required to submit a MAA in the EU.

Foreign regulatory authorities may ask for additional data in order to begin a clinical study, including phase 3 clinical trials required to submit a Marketing Authorization Application ("MAA") in the EU.

In addition such authorities often have the authority to require post-approval

studies, such as a post-authorization safety study ("PASS") and/or post-authorization efficacy study ("PAES"), which involve various risks similar to those described above.

Whether or not we obtain FDA approval for a product in the United States, we must obtain approval of the product by the comparable regulatory authorities in foreign countries before we can market that product or any other product in those countries.

Furthermore, in the European Economic Area ("EEA"), if we do not manage to retain a Qualified Person for Pharmacovigilance ("QPPV"), to maintain a Pharmacovigilance System Master File ("PSMF"), or to comply with other pharmacovigilance obligations, we may be at risk of our clinical trials being closed prematurely, our marketing authorization being suspended, and we may be subject to other enforcement actions by the national competent authorities of the EEA or the EC.

Furthermore, in the European Economic Area ("EEA"), if we do not manage to retain a Qualified Person Responsible for Pharmacovigilance ("QPPV"), to maintain a Pharmacovigilance System Master File ("PSMF"), or to comply with other pharmacovigilance obligations, we may be at risk of our clinical trials being closed prematurely, our marketing authorization being suspended, and we may be subject to other enforcement actions by the national competent authorities of the EEA or the EC.

The exact requirements concerning pharmacovigilance reporting may differ in the numerous countries in which we conduct clinical trials.

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A clinical trial may also fail because the dose(s) of the investigational drug included in the trial were either too low or too high to determine the optimal effect of the investigational drug in the disease setting.

Additionally, conducting clinical trials in foreign countries presents additional risks, including political and economic risks that are not present in the United States, such as armed conflict and economic embargoes or boycotts.

For example, we and our collaborators are currently conducting and may in the future conduct or initiate clinical trials with sites in Russia and/or Ukraine.

While we currently do not expect the conflict between Russia and Ukraine and related developments to have a significant impact on our ability to obtain results from clinical trials conducted by us or our collaborators, actions taken by Russia or potentially other countries in Ukraine and surrounding areas may adversely affect our ability to adequately conduct certain clinical trials and maintain compliance with relevant protocols due to, among other reasons, the prioritization of hospital resources away from clinical trials, reallocation or evacuation of site staff and subjects, or as a result of government-imposed curfews, warfare, violence, or other governmental action or events that restrict movement.

These developments may also result in our inability to access sites for monitoring or to obtain data from affected sites or patients going forward.

We could also experience disruptions in our supply chain or limits to our ability to provide sufficient investigational materials in Ukraine and surrounding regions.

Clinical trial sites may suspend or terminate the trials being conducted and patients could be forced to evacuate or choose to relocate, making them unavailable for initial or further participation in such trials.

Alternative sites in these areas may not be available and we may need to find other countries to conduct the relevant trials.

Furthermore, military action may prevent the FDA or other regulatory agencies from inspecting clinical sites in these countries.

Such interruptions may delay our plans for clinical development and approvals for our product candidates.

We will need to reevaluate any drug candidate that does not test favorably and either conduct new studies, which are expensive and time consuming, or abandon that drug development program.

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The failure of clinical trials to demonstrate the safety and effectiveness of our clinical candidates for the desired indication(s) would preclude the successful development of those candidates for such indication(s), in which event our business, prospects, operating results, and financial condition may be materially harmed.

Furthermore, some of our products and product candidates (such as Libtayo and Dupixent) are studied in combination with agents and treatments developed by us or our collaborators.

There may be additional risks and unforeseen safety issues resulting

from such combined administration, any of which may materially adversely impact clinical development of these product candidates and our ability to obtain regulatory approval.

In some jurisdictions such as the EU, initiating phase 3 clinical trials and clinical trials in the pediatric population is subject to a requirement to obtain approval or a waiver from the competent authorities of the EU Member States and/or the EMA.

Furthermore, some of our products and product candidates (such as Libtayo) are studied in combination with agents and treatments developed by us or our collaborators.

There may be additional risks and unforeseen safety issues resulting from such combined administration, any of which may materially adversely impact clinical development of these product candidates and our ability to obtain regulatory approval.

If we do not obtain such approval, our ability to conduct clinical trials and obtain marketing authorizations or approvals may be severely impaired and our business may be adversely impacted.

Certain of our research and development activities are conducted at our existing facilities primarily located in Tarrytown, New York.

As we continue to expand, we may lease, operate, purchase, or construct additional facilities to expand our research and development capabilities in the future.

Expanding our research and laboratory facilities may require significant time and resources.

Further, we may be unable to pursue our research and development efforts if the relevant facility were to cease operations due to fire, climate change, natural disasters, acts of war or terrorism, or other disruptions.

Any related delays may interfere with our research and development efforts and our business may be adversely impacted.

Successful development of our current and future product candidates is uncertain.

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Clinical trials may not demonstrate statistically sufficient effectiveness and safety to obtain the requisite regulatory approvals for these product candidates in these indications.

Many companies in the biopharmaceutical industry, including our Company, have suffered significant setbacks in clinical trials, even after promising results have been obtained in earlier trials.

Many companies in the biopharmaceutical industry, including our Company, have suffered significant setbacks in clinical trials, even after promising results had been obtained in earlier trials.

In a number of instances, we have terminated the development of product candidates due to a lack of or only modest effectiveness, and clinical trials evaluating our product candidates failed to meet the relevant endpoints.

For example, in August 2017, we reported that the Phase 3 study evaluating suptavumab, an antibody to RSV, did not meet its primary endpoint of preventing medically-attended RSV infections in infants;

as a result, we discontinued further clinical development of this antibody.

Moreover, even if we obtain positive results from preclinical testing or clinical trials, we may not achieve the same success in future trials, or the FDA and analogous foreign regulatory authorities may deem the results insufficient for an approval.

Many of our clinical trials are conducted under the oversight of IDMCs.

Many of our clinical trials are conducted under the oversight of Independent Data Monitoring Committees ("IDMCs").

These independent oversight bodies are made up of external experts who review the progress of ongoing clinical trials, including available safety and efficacy data, and make recommendations concerning a trial's continuation, modification, or termination based on interim, unblinded data.

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If additional clinical experience indicates that any of our product candidates or new indications for our marketed products has many side effects or causes serious or life-threatening side effects, the development of the product candidate may be delayed or fail, or, if the product candidate has received regulatory approval, such approval may be revoked, which would severely harm our business, prospects, operating results, and financial condition.

With respect to EYLEA, there are many potential safety concerns associated with significant blockade of VEGF that may limit our ability to further successfully commercialize EYLEA.

These serious and potentially life-threatening risks, based on clinical and preclinical experience of VEGF inhibitors, include bleeding, intestinal perforation, hypertension, proteinuria, congestive heart failure, heart attack, and stroke.

With respect to EYLEA and aflibercept 8 mg, there are many potential safety concerns associated with significant blockade of VEGF that may limit our ability to further successfully commercialize EYLEA and to obtain regulatory approval for aflibercept 8 mg.

These serious and potentially life-threatening risks, based on clinical and preclinical experience of VEGF inhibitors,

include bleeding, intestinal perforation, hypertension, proteinuria, congestive heart failure, heart attack, and stroke.

Other VEGF blockers have reported side effects that became evident only after large-scale trials or after marketing approval when large numbers of patients were treated.

There are risks inherent in the intravitreal

administration of drugs like aflibercept (such as intraocular inflammation ("IOI"), sterile and culture positive endophthalmitis, corneal decomposition, retinal detachment, and retinal tear), which can cause injury to the eye and other complications.

The side effects previously reported for EYLEA include conjunctival hemorrhage, macular degeneration, eye pain, retinal hemorrhage, and vitreous floaters.

In addition, commercialization of EYLEA or our other products may be impacted by actions of third parties on which we rely, such as manufacturers of syringes or other devices used in the administration of our products.

These and other complications or issues or side effects could harm further development and/or commercialization of EYLEA.

There are risks inherent in the intravitreal administration of drugs like aflibercept (such as intraocular inflammation ("IOI"), sterile and culture positive endophthalmitis, corneal decomposition, retinal detachment, and retinal tear), which can cause injury to the eye and other complications.

The side effects previously reported for aflibercept include conjunctival hemorrhage, macular degeneration, eye pain, retinal hemorrhage, and vitreous floaters.

There is no guarantee that we will be able to successfully obtain regulatory approval for aflibercept 8 mg.

In addition, commercialization of EYLEA or our other products and potential future commercialization of aflibercept 8 mg or our other product candidates may be impacted by actions of third parties on which we rely, such as manufacturers of syringes or other devices used in the administration of our products.

These and other complications or issues or side effects could harm further development and/or commercialization of EYLEA as well as further development and potential future commercialization of aflibercept 8 mg.

Dupixent and Libtayo are being studied in additional indications, as shown in the table under Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Overview - Programs in Clinical Development." There is no guarantee that marketing approval of Dupixent or Libtayo (as applicable) in any of these indications will be successfully obtained.

The side effects previously reported for Dupixent include hypersensitivity reactions, conjunctivitis and keratitis, injection-site reactions, eye and eyelid inflammation, cold sores, oropharyngeal pain, eosinophilia, insomnia, toothache, gastritis, joint pain (arthralgia), and facial rash or redness;

and the side effects previously reported for Libtayo include certain immune-mediated adverse reactions, such as pneumonitis, colitis, hepatitis, endocrinopathies, nephritis, and dermatologic reactions, as well as infusion-related reactions, cellulitis, sepsis, pneumonia, urinary tract infection, fatigue, rash, and diarrhea.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Overview - Programs in Clinical Development." There is no guarantee that regulatory approval of Dupixent or Libtayo (as applicable) in any of these indications will be successfully obtained.

The side effects previously reported for Dupixent include hypersensitivity reactions, eye problems (including conjunctivitis and keratitis), injection-site reactions, eye and eyelid inflammation, cold sores, oropharyngeal pain, eosinophilia, insomnia, toothache, gastritis, joint pain (arthralgia), parasitic (helminth) infections, and facial rash or redness;

and the side effects previously reported for Libtayo include certain immune-mediated adverse reactions that may occur in any organ system or tissue, including pneumonitis, colitis, hepatitis, endocrinopathies, nephritis, and dermatologic reactions, as well as infusion-related reactions, cellulitis, sepsis, pneumonia, urinary tract infection, fatigue, rash, and diarrhea.

These and other complications or side effects could harm further development and/or commercialization of Dupixent and Libtayo (as applicable).

There also are risks inherent in subcutaneous injections (which are used for administering most of our antibody-based products and product candidates), such as injection-site reactions (including redness, itching, swelling, pain, and tenderness) and other side effects.

In addition, there are risks inherent in intravenous administration (which are used for some of our antibody-based products and product candidates), such as infusion-related reactions (including nausea, pyrexia, rash, and dyspnea).

These and other complications or side effects could harm further development and/or commercialization of our antibody-based products and product candidates utilizing this method of administration.

Many of our product candidates in development are recombinant proteins that could cause an immune response, resulting in the creation of harmful or neutralizing antibodies against the therapeutic protein.

In addition to the safety, efficacy, manufacturing, and regulatory hurdles faced by our product candidates, the administration of recombinant proteins frequently causes an immune response, resulting in the creation of antibodies against the therapeutic protein.

In addition to the safety, efficacy, manufacturing, and regulatory hurdles faced by our product candidates, the administration of recombinant proteins frequently causes an immune response, sometimes resulting in the creation of antibodies against the therapeutic protein.

The antibodies can have no effect or can totally neutralize the effectiveness of the protein, or require that higher doses be used to obtain a therapeutic effect.

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The success of our products and product candidates may depend to a significant extent on the performance of such devices, some of which may be novel or comprised of complex components.

Given the increased complexity of the review process when approval of the product and device is sought under a single marketing application and the additional risks resulting from a product candidate's designation as a combination product discussed below, our product candidates used with such drug-delivery devices may be substantially delayed in receiving regulatory approval or may not be approved at all.

Given the increased complexity of the review process when approval of the product and device is sought

under a single marketing application and the additional risks resulting from a product candidate's designation as a combination product discussed below, our product candidates used with such drug-delivery devices may be substantially delayed in receiving regulatory approval or may not be approved at all.

The FDA review process and criteria for such applications are not well established, which could also lead to delays in the approval process.

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Risks Related to Intellectual Property and Market Exclusivity

For purposes of this subsection, references to our intellectual property (including patents, trademarks, copyrights, and trade secrets) include that of our collaborators and licensees, unless otherwise stated or required by the context.

If we cannot protect the confidentiality of our trade secrets, or our patents or other means of defending our intellectual property are insufficient to protect our proprietary rights, our business and competitive position will be harmed.

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Our patents may be challenged, invalidated, held to be unenforceable, or circumvented.

Patent applications filed outside the United States may be challenged by other parties, for example, by filing third-party observations that argue against patentability or an opposition.

For example, certain of our U.S.

patents (including those pertaining to our key products, such as EYLEA) have been and may in the future be challenged by parties who file a request for post-grant review or inter partes review under the America Invents Act of 2011 or ex parte reexamination, as described in Note 13 to our Condensed Consolidated Financial Statements included in this report.

Post-grant proceedings are increasingly common in the United States and are costly to defend.

In addition, patent applications filed outside the United States may be challenged by other parties, for example, by filing pre-grant third-party observations that argue against patentability or a post-grant opposition.

Such opposition proceedings are increasingly common in the EU and are costly to defend.

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We have pending patent applications in the United States Patent and Trademark Office (the "USPTO"), the EPO, and the patent offices of other foreign jurisdictions, and it is likely that we will need to defend patents from challenges by others from time to time in the future.

Certain of our U.S.

patents may also be challenged by parties who file a request for post-grant review or inter partes review under the America Invents Act of 2011 or ex parte reexamination.

For example, on February 11, 2020, anonymous parties filed two requests for ex parte reexamination of two of our patents - U.S.

10,406,226 (the "'226 Patent") and 10,464,992 (the "'992 Patent"), and the USPTO has granted both requests to initiate reexamination proceedings.

In addition, as described in Note 12 to our Condensed Consolidated Financial Statements, on May 5, 2021, Mylan Pharmaceuticals Inc.

filed petitions for inter partes review of U.S.

9,254,338 (the "'338 Patent") and 9,669,069 (the "'069 Patent");

and on September 7, 2021, Celltrion, Inc.

filed a petition for post-grant review of U.S.

10,857,231 (the "'231 Patent").

The '226 Patent concerns methods for manufacturing VEGF antagonist fusion proteins, including aflibercept;

the '992 Patent and the '231 Patent concern formulations and vials containing VEGF antagonist fusion proteins, including aflibercept;

and the '338 Patent and the '069 Patent concern methods for treating angiogenic eye disorders by administering VEGF antagonist fusion proteins, including aflibercept.

Post-grant proceedings are increasingly common in the United States and are costly to defend.

Our patent rights may not provide us with a proprietary position or competitive advantages against competitors.

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Any such changes could also affect the value of our intellectual property or narrow the scope of our patents.

For example, the World Trade Organization ("WTO") is currently considering a proposal formulated in connection with the COVID-19 pandemic for a waiver of certain intellectually property rights under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights;

For example, the World Trade Organization ("WTO") is currently considering a proposal formulated in connection with the COVID-19 pandemic for a waiver of certain intellectual property rights under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights;

the ultimate timing and scope of this waiver is unknown and we cannot be certain that our intellectual property rights related to REGEN-COV or any other current or future product or product candidate or technology would not be eliminated, narrowed, or weakened by any such waiver.

Additionally, the United States and other government actions related to Russia's invasion of Ukraine may limit or prevent filing, prosecution, and maintenance of patent applications in Russia.

These actions could result in abandonment or lapse of our patents or patent applications, resulting in partial or complete loss of patent rights in Russia.

Further, a decree was adopted by the Russian government in March 2022, allowing Russian companies and individuals to exploit inventions owned by patent holders from the United States without consent or compensation.

Consequently, we would not be able to prevent third parties from practicing our inventions in Russia or from selling or importing products made using our inventions in and into Russia.

We also currently hold issued trademark registrations and have trademark applications pending in the United States and other jurisdictions, any of which may be the subject of a governmental or third-party objection, which could prevent the maintenance or issuance of the trademark.

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For example, in August 2018, we and Sanofi entered into a license agreement with Bristol-Myers Squibb, E.

Squibb & Sons, and Ono Pharmaceutical to obtain a license under certain patents owned and/or exclusively licensed by one or more of these parties that includes the right to develop and sell Libtayo.

Squibb & Sons, and Ono

Pharmaceutical to obtain a license under certain patents owned and/or exclusively licensed by one or more of these parties that includes the right to develop and sell Libtayo.

If any licenses are required, we may not be able to obtain such licenses on commercially reasonable terms, if at all.

The failure to obtain any such license could prevent us from developing or commercializing any one or more of our products or product candidates, which could severely harm our business.

In addition, other parties may have regulatory exclusivity in the United States or foreign jurisdictions for products relating to targets or conditions we are also pursuing, which could prevent or delay our ability to apply for or obtain regulatory approval for our product candidates in such jurisdictions.

For example, in the EU, a designated orphan drug is provided up to 10 years of market exclusivity in the orphan indication, during which time the EMA is generally precluded from accepting a MAA for a similar medicinal product unless it can be demonstrated that it is safer, more effective, or otherwise clinically superior to the original orphan medicinal product.

Loss or limitation of patent rights, and regulatory pathways for biosimilar competition, could reduce the duration of market exclusivity for our products.

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We are aware of several companies developing biosimilar versions of EYLEA, as discussed further under "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - The commercial success of our products and product candidates is subject to significant competition - Marketed Products" above.

In the United States, the regulatory exclusivity period for EYLEA ( i.e.

, the period during which no biosimilar product can be approved by the FDA) expires on November 18, 2023, with the possibility of an additional six months of regulatory exclusivity ( i.e.

, until May 18, 2024) if the FDA grants pediatric exclusivity based on our completion of certain studies evaluating EYLEA in pediatric patients with ROP and submission of the data from these studies to the FDA no later than 15 months before the date on which regulatory exclusivity would otherwise expire.

In the United States, the regulatory exclusivity period for EYLEA (i.e., the period during which no biosimilar product can be approved by the FDA) expires on November 18, 2023, with the possibility of an additional six months of regulatory exclusivity (i.e., until May 18, 2024) if the FDA grants pediatric exclusivity based on our completion of certain studies evaluating EYLEA in pediatric patients with ROP and submission of the data from these studies to the FDA no later than 15 months before the date on which regulatory exclusivity would otherwise expire.

Refer to the table under Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Overview - Programs in Clinical Development" for more information.

The loss of market exclusivity for a product (such as EYLEA) would likely materially and negatively affect revenues from product sales of that product and thus our financial results and condition.

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Manufacturing facilities operated by us and by third-party contract manufacturers engaged by us would be inadequate to produce the active pharmaceutical ingredients of our current marketed products and our product candidates in sufficient clinical quantities if our clinical pipeline advances as planned.

For example, our internal and contracted manufacturing capacity may not be sufficient to cover the demand for REGEN-COV.

For example, our internal and contracted manufacturing capacity may not be sufficient if there is significant demand for REGEN-COV and our other COVID-19 monoclonal antibodies (if successfully developed and authorized for use).

In addition to expanding our internal capacity, we intend to continue to rely on our collaborators, and may also rely on contract manufacturers, to produce commercial quantities of drug material needed for commercialization of our products.

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"Management's Discussion and Analysis of Financial Condition and Results of Operations," in August 2020, we announced a collaboration agreement with Roche to develop, manufacture, and distribute REGEN-COV (known as Ronapreve in other countries outside the United States).

cannot be certain that our current manufacturing and distribution capacity for REGEN-COV or the increased manufacturing and distribution capacity through our collaboration with Roche will be sufficient.

We cannot be certain that our current manufacturing and distribution capacity for REGEN-COV or the increased manufacturing and distribution capacity through our collaboration with Roche will be sufficient if there is significant future demand for REGEN-COV.

As we increase our production in anticipation of potential regulatory approval for our product candidates, our current manufacturing capacity will likely not be sufficient, and our dependence on our collaborators and/or contract manufacturers may increase, to produce adequate quantities of drug material for both commercial and clinical purposes.

We rely entirely on other parties and our collaborators for filling and finishing services, including with respect to drug-delivery devices (such as a pre-filled syringe, patch pump, auto-injector, or other delivery system).

We also rely entirely on other parties and our collaborators for filling and finishing services.

Generally, in order for other parties to perform any step in the manufacturing and supply chain, we must transfer technology to the other party, which can be time consuming and may not be successfully accomplished without considerable cost and expense, or at all.

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For example, we are currently party to patent infringement and other proceedings relating to the EYLEA pre-filled syringe, as described in Note 13 to our Condensed Consolidated Financial Statements.

A judicial or regulatory decision in favor of one or more parties making such allegations could directly or indirectly preclude the

manufacture of our products to which those intellectual property rights apply on a temporary or permanent basis, which could materially harm our business, prospects, operating results, and financial condition.

A judicial or regulatory decision in favor of one or more parties making such allegations could directly or indirectly preclude the manufacture of our products to which those intellectual property rights apply on a temporary or permanent basis, which could materially harm our business, prospects, operating results, and financial condition.

If sales of our marketed products do not meet the levels currently expected, or if the launch of any of our product candidates is delayed or unsuccessful, we may face costs related to excess inventory or unused capacity at our manufacturing facilities and at the facilities of third parties or our collaborators.

We use our manufacturing facilities primarily to produce bulk product for commercial supply of our marketed products and clinical and preclinical candidates for ourselves and our collaborations.

We also plan to use such facilities to produce bulk product for commercial supply of new indications of our marketed products and new product candidates if they are approved for marketing.

We also plan to use such facilities to produce bulk product for commercial supply of new indications of our marketed products and new product candidates if they are approved for marketing or otherwise authorized for use.

If our clinical candidates are discontinued or their clinical development is delayed, if the launch of new indications for our marketed products or new product candidates is delayed or does not occur, or if such products are launched and the launch is unsuccessful or the product is subsequently recalled or marketing approval is rescinded, we may have to absorb one hundred percent of related overhead costs and inefficiencies, as well as similar costs of third-party contract manufacturers performing services for us.

In addition, if we or our collaborators experience excess inventory, it may be necessary to write down or write off such excess inventory or incur an impairment charge with respect to the facility where such product is manufactured, which could adversely affect our operating results.

For example, during the fourth quarter of 2021, we recorded a charge of $231.7 million to write down REGEN-COV inventory.

Third-party service or supply failures, or other failures, business interruptions, or other disasters affecting our manufacturing facilities in Rensselaer, New York and Limerick, Ireland, the manufacturing facilities of our collaborators, or the facilities of any other party participating in the supply chain, would adversely affect our ability to supply our products.

Bulk drug materials are currently manufactured at our manufacturing facilities in Rensselaer, New York and Limerick, Ireland, as well as at our collaborators' facilities.

We and our collaborators would be unable to manufacture these materials if the relevant facility were to cease production due to regulatory requirements or actions, business interruptions, labor shortages or disputes, contaminations, fire, natural disasters, acts of war or terrorism, or other problems.

We and our collaborators would be unable to manufacture these materials if the relevant facility were to cease production due to regulatory requirements or actions, business interruptions, labor shortages or disputes, supply chain interruptions or constraints (including with respect to natural gas and other raw materials), contaminations, fire, climate change, natural disasters, acts of war or terrorism, or other problems.

Many of our products and product candidates are very difficult to manufacture.

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In addition, we rely on certain third parties or our collaborators to perform filling, finishing, distribution, laboratory testing, and other services related to the manufacture of our marketed products and product candidates, and to supply various raw materials and other products.

We would be unable to obtain these raw materials, other products, or services for an indeterminate period of time if any of these third parties were to cease or interrupt production or otherwise fail to supply these materials, products, or services to us for any reason, including due to regulatory requirements or actions (including recalls), adverse financial developments at or affecting the supplier, failure by the supplier to comply with cGMPs, contaminations, business interruptions, or labor shortages or disputes (in each case, including as a result of the COVID-19 pandemic).

In any such circumstances, we may not be able to engage a backup or alternative supplier or service provider in a timely manner or at all.

In any such circumstances, we may not be able to engage a backup or alternative

supplier or service provider in a timely manner or at all.

This, in turn, could materially and adversely affect our or our collaborators' ability to manufacture or supply marketed products and product candidates, which could materially and adversely affect our business and future prospects.

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The FDA's review of promotional activities includes healthcare provider-directed and direct-to-consumer advertising, communications regarding unapproved uses, industry-sponsored scientific and educational activities, and sales representatives' communications.

Failure to comply with applicable FDA requirements and restrictions in this area may subject a company to adverse publicity and enforcement action by the FDA, the Department of Justice, or the Office of the Inspector General of the HHS, as well as state authorities.

This could subject a company to a range of penalties that could have a significant commercial impact, including civil and criminal fines and agreements that materially restrict the manner in which a company promotes or distributes a drug.

Failure to comply with applicable FDA requirements and restrictions in this area may subject a company to adverse enforcement action by the FDA, the Department of Justice, or the Office of the Inspector General of the HHS, as well as state authorities.

This could subject a company to a range of penalties that could have a significant commercial impact, including civil and criminal fines and agreements that materially restrict the manner in which a

company promotes or distributes a drug.

Any such failures could also cause significant reputational harm.

The FDA may take enforcement action for promoting unapproved uses of a product or other violations of its advertising laws and regulations.

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As described further in Note 13 to our Condensed Consolidated Financial Statements included in this report, we are party to a civil complaint filed in June 2020 by the U.S.

Attorney's Office for the District of Massachusetts concerning our support of 501(c)(3) organizations that provide financial assistance to patients;

Attorney's Office for the District of Massachusetts concerning our support of a 501(c)(3) organization that provides financial assistance to patients;

and we are cooperating with pending government investigations concerning certain other business activities.

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Information provided by companies is aggregated and posted annually on an "Open Payments" website, which is managed by CMS, the agency responsible for implementing these disclosure requirements.

Beginning in 2022, applicable manufacturers also will be required to report information (starting with information collected during 2021) regarding payments and transfers of value provided to physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants, and certified nurse-midwives.

We continue to dedicate significant resources to comply with these requirements and need to be prepared to comply with additional reporting obligations outside of the United States that may apply in the future.

Beginning in 2022, applicable manufacturers also are required to report information (starting with information collected during 2021) regarding payments and transfers of value provided to physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants, and certified nurse-midwives.

We also have similar reporting obligations in other countries based on laws, regulations, and/or industry trade association requirements.

We continue to dedicate significant resources to comply with these requirements and need to be prepared to comply with additional reporting obligations outside the United States that may apply in the future.

In addition, several states have legislation requiring pharmaceutical companies to establish marketing compliance programs, file periodic reports with the state, or make periodic public disclosures on sales, marketing, pricing, clinical trials, and other activities;

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If we fail to comply with our reporting and payment obligations under the Medicaid Drug Rebate program or other governmental pricing programs, we could be subject to additional reimbursement requirements, penalties, sanctions and fines, which could have a material adverse effect on our business, financial condition, results of operations, and future prospects.

We participate in the Medicaid Drug Rebate program, the Public Health Service's 340B drug pricing program (the "340B program"), the U.S.

We participate in the Medicaid Drug Rebate program, the Public Health Service's 340B drug pricing program (the "340B program"), which is administered by the Health Resources and Services Administration ("HRSA"), the U.S.

Department of Veterans Affairs ( "VA") Federal Supply Schedule ( "FSS") pricing program, and the Tricare Retail Pharmacy Program.

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Civil monetary penalties can be applied if we are found to have knowingly submitted any false price or product information to the government, if we are found to have made a misrepresentation in the reporting of our average sales price, if we fail to submit the required price data on a timely basis, or if we are found to have charged 340B covered entities more than the statutorily mandated ceiling price.

CMS could also decide to terminate our Medicaid drug rebate agreement, in which case federal payments may not be available under Medicaid or Medicare Part B for our covered outpatient drugs.

CMS could also decide to terminate our Medicaid drug rebate agreement, or HRSA could decide to terminate our 340B program participation agreement, in which case federal payments may not be available under Medicaid or Medicare Part B for our covered outpatient drugs.

Our failure to comply with our reporting and payment obligations under the Medicaid Drug Rebate program and other governmental programs could negatively impact our financial results.

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Any charge by HRSA that we have violated the requirements of the program or the regulation could negatively impact our financial results.

Moreover, under a final regulation effective January 13, 2021, HRSA newly established an administrative dispute resolution ("ADR") process for claims by covered entities that a manufacturer has engaged in overcharging, and by manufacturers that a covered entity violated the prohibitions against diversion or duplicate discounts.

Moreover, under a final regulation effective January 13, 2021, HRSA newly established an ADR process for claims by covered entities that a manufacturer has engaged in overcharging, and by manufacturers that a covered entity violated the prohibitions against diversion or duplicate discounts.

Such claims are to be resolved through an ADR panel of government officials rendering a decision that could be appealed only in federal court.

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Further, any additional future changes to the definition of average manufacturer price and the Medicaid rebate amount under the PPACA or otherwise could affect our 340B ceiling price calculations and negatively impact our results of operations.

We have obligations to report the average sales price for certain of our drugs to the Medicare program.

We have obligations to report the average sales price for certain of our drugs to the Medicare program as a part of our agreement to participate in the Medicaid Drug Rebate program.

For calendar quarters beginning January 1, 2022, we need to report the average sales price for certain drugs under the Medicare program regardless of whether we participate in the

Medicaid Drug Rebate program.

Statutory or regulatory changes or CMS guidance could affect the average sales price calculations for our products and the resulting Medicare payment rate, and could negatively impact our results of operations.

Starting in 2023, manufacturers must pay refunds to Medicare for single-source drugs or biological products, or biosimilar biological products, reimbursed under Medicare Part B and packaged in single-dose containers or single-use packages for units of discarded drug reimbursed by Medicare Part B in excess of 10 percent of total allowed charges under Medicare Part B for that drug.

Manufacturers that fail to pay refunds could be subject to civil monetary penalties of 125 percent of the refund amount.

Pursuant to applicable law, knowing provision of false information in connection with price reporting or contract‑based requirements under the VA/FSS and/or Tricare programs can subject a manufacturer to civil monetary penalties.

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Such improper actions could subject us to civil or criminal investigations, and monetary and injunctive penalties, and could adversely impact our ability to conduct business, operating results, and reputation.

In particular, our business activities outside of the United States are subject to the Foreign Corrupt Practices Act, or FCPA, and similar anti-bribery or anti-corruption laws, regulations or rules of other countries in which we operate, including the U.K.

In particular, our business activities outside the United States are subject to the Foreign Corrupt Practices Act, or FCPA, and similar anti-bribery or anti-corruption laws, regulations or rules of other countries in which we operate, including the U.K.

The FCPA generally prohibits offering, promising, giving, or authorizing others to give anything of value, either directly or indirectly, to a non-U.S.

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These entities, including the SEC and The NASDAQ Stock Market LLC, have issued a significant number of new and increasingly complex requirements and regulations over the course of the last several years and continue to develop additional requirements and regulations.

For example, there are significant corporate governance and executive compensation-related provisions in the Dodd-Frank Wall Street Reform and Protection Act that expressly authorized or required the SEC to adopt additional rules in these areas, a number of which have yet to be fully implemented.

For example, in March 2022, the SEC proposed new rules for extensive and prescriptive climate-related disclosure in annual reports and registration statements, which would also require inclusion of certain climate-related financial metrics in a note to companies’ audited financial statements.

Also in March 2022, the SEC proposed rules that are intended to enhance and standardize disclosures regarding cybersecurity risk management, strategy, and governance, as well as cybersecurity incident reporting, by public companies.

Our efforts to comply with these requirements and regulations (as well as corporate governance and disclosure expectations of investors and other stakeholders) have resulted in, and are likely to continue to result in, an increase in expenses and a diversion of management's time from other business activities.

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For example, a prolonged shutdown may significantly delay the FDA's ability to timely review and process any submissions we have filed or may file or cause other regulatory delays, which could materially and adversely affect our business.

Risks associated with our operations outside of the United States could adversely affect our business.

Risks associated with our operations outside the United States could adversely affect our business.

We have operations and conduct business outside the United States and we plan to expand these activities.

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Consequently, we are, and will continue to be, subject to risks related to operating in foreign countries, which include:

• unfamiliar foreign laws or regulatory requirements or unexpected changes to those laws or requirements, including those with which we and/or our collaborators must comply in order to maintain our marketing authorizations outside of the United States;

• other laws and regulatory requirements to which our business activities abroad are subject, such as the FCPA and the U.K.

• other laws and regulatory and industry trade association requirements to which our business activities abroad are subject, such as the FCPA and the U.K.

Bribery Act (discussed in greater detail above under " Risks from the improper conduct of employees, agents, contractors, or collaborators could adversely affect our reputation and our business, prospects, operating results, and financial condition ");

• changes in the political or economic condition of a specific country or region;

• changes in the political or economic condition of a specific country or region, including as a result of Russia's invasion of Ukraine;

• fluctuations in the value of foreign currency versus the U.S.

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We do not know to what extent Brexit will ultimately impact the business and regulatory environment in the United Kingdom, the rest of the EU, or other countries.

For example, the impact of Brexit on the ongoing validity in the United Kingdom of current EU authorizations for medicinal products and on the future

process for obtaining and maintaining marketing authorization for pharmaceutical products manufactured or sold in the United Kingdom remains uncertain.

For example, the impact of Brexit on the ongoing validity in the United Kingdom of current EU authorizations for medicinal products and on the future process for obtaining and maintaining marketing authorization for pharmaceutical products manufactured or sold in the United Kingdom remains uncertain.

We have large-scale manufacturing operations in Limerick, Ireland and have also established an office in the vicinity of London.

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Further, our effective tax rate may also be adversely affected by numerous other factors, including changes in the mix of our profitability from country to country, changes in tax laws and regulations, and tax effects of the accounting for stock-based compensation (which depend in part on the price of our stock and, therefore, are beyond our control).

There are various U.S.

tax law changes under consideration, including increases to the corporate income tax rates on both domestic and foreign income, that could have significant impact on our tax liability.

Increases to the income tax rate or other changes to the tax law could materially impact our tax provision, cash tax liability, and effective tax rate.

In addition, recommendations by the Organization for Economic Co-operation and Development and the EU could require companies to disclose more information to tax authorities on operations around the world, which may lead to greater audit scrutiny.

Changes to U.S.

tax laws and/or recommendations from the Organization for Economic Co-operation and Development (the "OECD") regarding a global minimum tax and other changes being considered and/or implemented in countries where we operate could materially impact our tax provision, cash tax liability, and effective tax rate.

In addition, recommendations by the OECD and the EU could require companies to disclose more information to tax authorities on operations around the world, which may lead to greater audit scrutiny.

Even though we regularly assess the information provided to tax authorities in determining the appropriateness of our tax reserves, such tax authorities could take a position that is contrary to our expectations, and the result could adversely affect our provision for income tax and our current rate.

We face potential liability related to the personal information we collect from individuals, data brokers, or research institutions or obtain from clinical trials sponsored by us or our collaborators.

health care providers, including research institutions from which we or our collaborators obtain clinical trial data, are subject to privacy and security regulations promulgated under the Health Insurance Portability and Accountability Act of 1996 ("HIPAA").

For example, as part of our human genetics initiative, our wholly-owned subsidiary, Regeneron Genetics Center LLC, has entered into collaborations with research institutions, including the Geisinger Health System, which are subject to such regulations.

Regeneron is not currently classified as a covered entity or business associate under HIPAA and thus is not subject to its requirements or penalties.

However, we could potentially be subject to criminal penalties if we, our affiliates, or our agents knowingly obtain, use, or disclose individually identifiable health information maintained by a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.

Consequently, depending on the facts and circumstances, we could face substantial criminal penalties if we knowingly receive individually identifiable health information from a HIPAA-covered health care provider or research institution that has not satisfied HIPAA's requirements for disclosure of individually identifiable health information.

There are instances where we collect and maintain sensitive personally identifiable information, which may include health information outside of the scope of HIPAA.

This information may be received throughout the clinical trial process, in the course of our research collaborations, directly from individuals who enroll in our patient assistance programs, and from our own employees in a pandemic response process (such as in connection with the COVID-19 pandemic).

In the case of a breach of personal information we may be subject to state breach notification laws requiring notification of affected individuals and state regulators.

Our patient assistance programs and product marketing activities as part of which we collect California resident personal data are subject to the California Consumer Privacy Act of 2018 (the "CCPA").

The CCPA, which became effective on January 1, 2020, is a consumer protection law that establishes certain requirements for data use and sharing transparency and provides California residents with personal data privacy rights regarding the use, disclosure, and retention of their personal data.

The CCPA requires us, among other things, to update our notices and develop new processes internally and with our partners.

Amendments to the CCPA and legislative proposals at the federal and state level could impose new obligations or limitations in areas affecting our business.

These laws and regulations are constantly evolving and may impose limitations on our business activities.

Several other U.S.

states have introduced similar consumer protection laws that may go into effect in the near future.

Our clinical trial programs and research collaborations outside the U.S.

(such as our consortium with a group of companies to fund the generation of genetic exome sequence data from the UK Biobank health resource) implicate international data

protection laws, including the EU's General Data Protection Regulation (the "GDPR").

The GDPR has created a range of new compliance obligations, including increased transparency requirements and new data subject rights.

We face risks related to the personal data we collect, process, and share.

Our ability to conduct our business is significantly dependent on the data that we collect, process, and share in discovering, developing, and commercializing drug products.

These data are often considered personal data and are therefore regulated by data privacy laws in applicable jurisdictions.

Our activities outside the U.S., including clinical trial programs and research collaborations (such as our consortium with a group of companies to fund the generation of genetic exome sequence data from the UK Biobank health resource), implicate non-U.S.

data protection laws, including the EU's General Data Protection Regulations ("GDPR").

The GDPR has a wide range of compliance obligations, including increased transparency requirements and data subject rights.

Violations of the GDPR carry significant financial penalties for noncompliance (including possible fines of up to 4% of global annual turnover for the preceding financial year or €20 million (whichever is higher)).

In addition to the GDPR, certain EU Member States have issued or will be issuing their own implementation legislation.

In June 2021, the European Commission introduced new standard contractual clauses required to be incorporated into new and existing agreements within prescribed timeframes in order to continue to lawfully transfer personal data outside the EU.

Compliance with these requirements has been and is expected to continue to be costly and time consuming.

We conduct clinical trials in many countries around the world, which have new or evolving data privacy laws that have resulted in increased liability in the management of clinical trial data, and additional contractual and due-diligence obligations that could lead to a delay in clinical trial site start-up.

There is an increase of enforcement activities in various EU countries that require evidence of compliance with local data privacy requirements.

While we continue to monitor these developments, there remains some uncertainty surrounding the legal and regulatory environment for these evolving privacy and data protection laws.

Complying with varying jurisdictional requirements could increase the costs and complexity of compliance, including the risk of substantial financial penalties for insufficient notice and consent, failure to respond to data subject rights requests, lack of a legal basis for the transfer of personal information out of the EU, or improper processing of personal data under the GDPR.

Failure by our collaborators to comply with the strict rules on the transfer of personal data outside of the EU into the U.S.

may result in the imposition of criminal and administrative sanctions on such collaborators, which could adversely affect our business and could create liability for us.

Furthermore, health privacy laws, data breach notification laws, consumer protection laws, data localization laws, and genetic testing laws may apply directly to our operations and/or those of our collaborators and may impose restrictions on our collection, use, and dissemination of individuals' health and other personal information.

Moreover, individuals about whom we or our collaborators obtain health or other personal information, as well as the providers and third parties who share this information with us, may have statutory or contractual limits that impact our ability to use and disclose the information.

Failure by our collaborators to comply with the strict rules on the transfer of personal data outside the EU into the U.S.

may result in the imposition of criminal and administrative sanctions on such collaborators or impact the flow of personal data outside the EU, which could adversely affect our business and could create liability for us.

health care providers, including research institutions from which we or our collaborators obtain clinical trial data, are subject to privacy and security regulations promulgated under HIPAA.

Regeneron is not a covered entity or business associate under HIPAA and thus is not subject to its requirements.

However, we could be subject to criminal penalties if we, our affiliates, or our agents knowingly receive, use, or disclose PHI in a manner that is not permitted under HIPAA.

Consequently, depending on the facts and circumstances, we could face substantial criminal penalties if we knowingly receive PHI from a health care provider or research institution that has not satisfied HIPAA's requirements for its disclosure.

There are instances where we collect and maintain personal data, which may include health information that is outside the scope of HIPAA but within the scope of state health privacy laws or similar state level privacy legislation.

Consumer protection laws impact the manner in which we develop and maintain processes to support our patient assistance programs, product marketing activities, and the sharing of employee and clinical data for internal and third-party commercial activities.

states have proposed and passed consumer privacy laws, which were modeled after the California Consumer Privacy Act of 2018 (the "CCPA").

The CCPA, which became effective on January 1, 2020, is a consumer protection law that establishes requirements for data use and sharing transparency and provides California residents with personal data privacy rights regarding the use, disclosure, and retention of their personal data.

Amendments to the CCPA have, among other things, imposed new obligations to provide notice where personal data will be de-identified.

These laws and regulations are constantly evolving and may impose limitations on our business activities.

Several other U.S.

states have introduced similar consumer protection laws that may go into effect in the near future.

At the federal level, Section 5 of the Federal Trade Commission Act is a consumer protection law that bars unfair and deceptive acts and practices and requires, among other things, companies to notify individuals that they will safeguard their personal data and that they will fulfil the commitments made in their privacy notices.

The Federal Trade Commission has brought legal actions against organizations that have violated consumers' privacy rights or have misled them by failing to maintain appropriate security.

Furthermore, health privacy laws, data breach notification laws, consumer protection laws, data localization laws, and genetic privacy laws may apply directly to our operations and/or those of our collaborators and may impose restrictions on our collection, use, and dissemination of individuals' health and other personal data.

New state level genetic privacy and consumer protection laws in the United States may require additional transparency and permissions in our informed consent forms.

Moreover, individuals about whom we or our collaborators obtain health or other personal data, as well as the providers and third parties who share this information with us, may have statutory or contractual limits that impact our ability to use and disclose the information.

We are likely to be required to expend significant capital and other resources to ensure ongoing compliance with applicable privacy and data security laws both inside and outside the United States.

Many of these laws differ from each other in significant ways and have different effects.

Many of these laws differ

from each other in significant ways and have different effects.

Many of the state laws enable a state attorney general to bring actions and provide private rights of action to consumers as enforcement mechanisms.

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Despite our efforts to monitor evolving social media communication guidelines and comply with applicable rules, there is a risk that the use of social media by us or our employees to communicate about our products or business may cause us to be found in violation of applicable requirements.

In addition, our employees may knowingly or inadvertently make use of social media in ways that may not comply with our social media policy or other legal or contractual requirements, which may give rise to liability, lead to the loss of trade secrets or other intellectual property, or result in public exposure of personal information of our employees, clinical trial patients, customers, and others.

In addition, our employees may knowingly or inadvertently make use of social media in ways that may not comply with our social media policy or other legal or contractual requirements, which may give rise to liability, lead to the loss of trade secrets or other intellectual property, or result in public exposure of personal data of our employees, clinical trial patients, customers, and others.

Furthermore, negative posts or comments about us or our products in social media could seriously damage our reputation, brand image, and goodwill.

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Risks Related to Our Reliance on Third Parties

If our Antibody Collaboration or our IO Collaboration with Sanofi is terminated, our business, prospects, operating results, and financial condition, and our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed.

If our Antibody Collaboration or our IO Collaboration with Sanofi is terminated, or Sanofi materially breaches its obligations thereunder, our business, prospects, operating results, and financial condition, and our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed.

We rely on funding and support from Sanofi to develop, manufacture, and commercialize certain of our products and product candidates.

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We also depend, or will depend, on some of these third parties in connection with the commercialization of our marketed products and our product candidates and new indications for our marketed products if they are approved for marketing.

If any of our existing collaborators or service providers breaches or terminates its agreement with us or does not perform its development or manufacturing services under an agreement in a timely manner (including as a result of its inability to perform due to financial or other relevant constraints) or in compliance with applicable GMPs, GLPs, or GCP standards, we could experience additional costs, delays, and difficulties in the manufacture or development of, or in obtaining approval by regulatory authorities for, or successfully commercializing our product candidates.

If any of our existing collaborators or service providers breaches or terminates its agreement with us or does not perform its development or manufacturing services under an agreement in a timely manner (including as a result of its inability to perform due to financial or other relevant constraints, such as due to Russia's invasion of Ukraine) or in compliance with applicable GMPs, GLPs, or GCP standards, we could experience additional costs, delays, and difficulties in the manufacture or development of, or in obtaining approval by regulatory authorities for, or successfully commercializing our product candidates.

We and our collaborators rely on third-party service providers to support the distribution of our marketed products and for many other related activities in connection with the commercialization of these marketed products.

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If these service providers do not perform their services adequately, sales of our marketed products will suffer.

Risk Related to Employees

Risks Related to Employees

We are dependent on our key personnel and if we cannot recruit and retain leaders in our research, development, manufacturing, and commercial organizations, our business will be harmed.

We are highly dependent on certain of our executive officers, other key members of our senior management team, and our Chairman.

We are highly dependent on certain of our executive officers, other key members of our senior management team, and the Chair of our board of directors.

If we are not able to retain (or for any other reason lose the services of) any of these persons, our business may suffer.

In particular, we depend on the services of P.

Roy Vagelos, M.D., the Chairman of our board of directors;

Roy Vagelos, M.D., the Chair of our board of directors;

Schleifer, M.D., Ph.D., our President and Chief Executive Officer;

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Our business is increasingly dependent on critical, complex, and interdependent information technology systems, including Internet-based systems, to support business processes as well as internal and external communications.

These systems are also critical to enable remote working arrangements, which have been growing in importance due in part to the COVID-19 pandemic and our implementation of work-from-home policies for a significant part of our employees.

These systems are also critical to enable remote working arrangements, which have been growing in importance due in part to the COVID-19 pandemic and related developments.

The size and complexity of our computer systems make us potentially vulnerable to IT system breakdowns, internal and external malicious intrusion, and computer viruses and ransomware, which may impact product production and key business processes.

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As a company with an increasingly global presence, our systems are subject to frequent attacks.

There is the potential that our systems may be directly or indirectly affected as nation-states conduct global cyberwarfare, including in connection with the current Russia-Ukraine hostilities.

Due to the nature of some of these attacks, there is a risk that an attack may remain undetected for a period of time.

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Risks Related to Our Financial Results, Liquidity, and Need for Additional Financing

If we cannot sustain profitability, our business, prospects, operating results, and financial condition would be materially harmed.

If we cannot sustain profitability, we may be unable to continue our operations.

In the absence of substantial revenue from the sale of products on an ongoing basis, including our net product sales of EYLEA and funding we receive under our collaboration agreements (including our share of profits in connection with commercialization of EYLEA and Dupixent under our collaboration agreements with Bayer and Sanofi, respectively), or from other sources, the amount, timing, nature, or source of which cannot be predicted, we may incur substantial losses again as we conduct our research and development activities, commercialize our approved products, and prepare for possible commercialization of our other product candidates and new indications of our marketed products.

We may need additional funding in the future, which may not be available to us, and which may force us to delay, reduce or eliminate our product development programs or commercialization efforts.

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We may require additional financing in the future and we may not be able to raise additional funds on acceptable terms or at all.

For example, there is no guarantee that we will have the ability to pay the principal amount due on the Notes at maturity or redeem, repurchase, or refinance the Notes prior to maturity on acceptable terms or at all.

In addition, in March 2017, we completed a $720.0 million lease financing for our existing corporate headquarters and other rentable area consisting of approximately 150 acres of predominately office buildings and laboratory space located in Tarrytown, New York, which will become due and payable in full in March 2022 unless extended with the consent of all the participants and subject to certain other conditions.

For example, there is no guarantee that we will have the ability to pay the principal amount due on our senior unsecured notes at maturity or redeem, repurchase, or refinance the notes prior to maturity on acceptable terms or at all.

In addition, in March 2022, we completed an extension of the $720.0 million lease financing for our existing corporate

headquarters and other rentable area consisting of approximately 150 acres of predominately office buildings and laboratory space located in Tarrytown, New York, which is set to expire in March 2027.

Refer to Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Tarrytown, New York Leases " for further details.

Our ability to refinance or to obtain additional financing could be adversely affected if there is a significant decline in the demand for our products or other significantly unfavorable changes in economic conditions.

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We have certain indebtedness and contingent liabilities, including milestone and royalty payment obligations.

As of September 30, 2021, we had an aggregate of $2.699 billion of outstanding indebtedness under the Notes and the lease financing facility.

As of March 31, 2022, we had an aggregate of $2.700 billion of outstanding indebtedness under our senior unsecured notes and the lease financing facility.

We may also incur additional debt in the future.

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Changes in foreign currency exchange rates could have a material adverse effect on our operating results.

Our revenue from outside of the United States will increase as our products, whether marketed or otherwise commercialized by us or our collaborators, gain marketing approval in such jurisdictions.

Our revenue from outside the United States will increase as our products, whether marketed or otherwise commercialized by us or our collaborators, gain marketing approval in such jurisdictions.

Our primary foreign currency exposure relates to movements in the Japanese yen, euro, British pound sterling, Canadian dollar, and Australian dollar.

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Our investments are subject to risks and other external factors that may result in losses or affect the liquidity of these investments.

As of September 30, 2021, we had $3.432 billion in cash and cash equivalents and $7.987 billion in marketable securities (including $1.372 billion in equity securities).

As of March 31, 2022, we had $3.346 billion in cash and cash equivalents and $10.789 billion in marketable securities (including $1.039 billion in equity securities).

Our investments consist primarily of debt securities, including investment-grade corporate bonds.

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If any of our investments suffer market price declines, such declines may have an adverse effect on our financial condition and operating results.

The elimination of LIBOR could adversely affect our business, operating results, and financial condition.

We are subject to risks related to uncertainty regarding the London Interbank Offered Rate ("LIBOR").

LIBOR is the subject of recent national, international, and other regulatory guidance and proposals for reform, which may cause LIBOR to cease to exist, or no longer be available for new contracts, after 2021 or to perform differently than in the past.

On March 5, 2021, the Financial Conduct Authority in the U.K.

announced that all LIBOR settings will either cease to be provided or no longer be representative (i) immediately after December 31, 2021, in the case of the one-week and two-month U.S.

dollar LIBOR terms and all sterling, euro, Swiss franc, and Japanese yen settings, and (ii) immediately after June 30, 2023, in the case of the one-, three-, six-, and 12-month U.S.

dollar LIBOR terms.

While regulators in various jurisdictions have been working to replace LIBOR prior to the 2021 and 2023 target dates, uncertainty exists in the markets as to the adoption and implementation of alternative reference rates.

Changes in the method of determining LIBOR, or the replacement of LIBOR with an alternative reference rate, may adversely affect our business, operating results, and financial condition.

We are subject to risks related to uncertainty regarding the London Interbank Offered Rate ("LIBOR"), which is in the process of being phased out.

Financial Conduct Authority, which regulates LIBOR, has announced that it intends to phase out LIBOR.

The publication of U.S.

dollar LIBOR for certain tenors and all non-U.S.

dollar LIBOR tenors ceased after December 31, 2021 (other than certain sterling and Japanese yen settings being published on a synthetic temporary basis).

Banks reporting information used to set U.S.

dollar LIBOR for all other tenors are currently expected to stop doing so after June 30, 2023, although the LIBOR administrator may discontinue or modify LIBOR prior to that date.

In 2021, the U.S.

Federal Reserve Board and certain other regulatory bodies issued guidance encouraging banks and other financial market participants to cease entering into new contracts that use U.S.

dollar LIBOR as a reference rate as soon as practicable and in any event no later than December 31, 2021.

Although regulators in various jurisdictions have been working to replace LIBOR and have encouraged the development and adoption of alternative reference rates, such as the Secured Overnight Financing Rate ("SOFR"), there continues to be uncertainty regarding the nature of potential changes to and future utilization of specific LIBOR tenors, the development and acceptance of alternative reference rates, and other reforms.

We cannot predict the consequences and timing of these developments or other market or regulatory changes related to the phase-out of LIBOR.

Federal Reserve, in conjunction with the Alternative Reference Rates Committee (a steering committee comprised of large U.S.

financial institutions), has identified the Secured Overnight Financing Rate ("SOFR"), a new index calculated by short-term repurchase agreements, backed by Treasury securities, as its preferred alternative rate for LIBOR.

At this time, it is not possible to predict how markets will respond to SOFR or other alternative reference rates as the transition away from LIBOR is anticipated in coming years.

There is currently limited information regarding the future utilization of LIBOR or of any particular replacement rate.

A transition away from LIBOR as a benchmark for establishing the applicable interest rate may adversely affect our outstanding variable-rate indebtedness (if any), as well as floating-rate debt securities in our investment portfolio.

For example, if a published U.S.

dollar LIBOR is unavailable after 2021 or 2023, interest for borrowings (if any) with an interest rate based on LIBOR under our revolving credit facility, which are indexed to LIBOR, will be determined using various alternative methods, any of which may result in interest obligations which are more than, or do not otherwise correlate over time with, the payments that would have been made on such debt if U.S.

dollar LIBOR was available in its current form.

dollar LIBOR is unavailable or no longer representative, interest for borrowings (if any) with an interest rate based on LIBOR under our revolving credit facility will be determined using various alternative methods, any of which may result in interest obligations which are more than, or do not otherwise correlate over time with, the payments that would have been made on such debt prior to any LIBOR phase-out.

Risks Related to Our Common Stock

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• developments in our relationships with collaborators or key customers;

• developments in the biotechnology industry or in government regulation of healthcare, including those relating to compounding ( i.e.

, a practice in which a pharmacist, a physician, or, in the case of an outsourcing facility, a person under the supervision of a pharmacist, combines, mixes, or alters ingredients of a drug to create a medication tailored to the needs of an individual patient);

• developments in the biotechnology industry or in government regulation of healthcare, including those relating to compounding (i.e., a practice in which a pharmacist, a physician, or, in the case of an outsourcing facility, a person under the supervision of a pharmacist, combines, mixes, or alters ingredients of a drug to create a medication tailored to the needs of an individual patient);

• large sales of our Common Stock by our executive officers or other employees, directors, or significant shareholders (or the expectation of any such sales);

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As discussed in greater detail under " Future sales of our Common Stock by our significant shareholders or us may depress our stock price and impair our ability to raise funds in new share offerings " below, a large percentage of our Common Stock is owned by a small number of our principal shareholders.

As a result, the public float of our Common Stock ( i.e.

, the portion of our Common Stock held by public investors, as opposed to the Common Stock held by our directors, officers, and principal shareholders) may be lower than the public float of other large public companies with broader public ownership.

As a result, the public float of our Common Stock (i.e., the portion of our Common Stock held by public investors, as opposed to the Common Stock held by our directors, officers, and principal shareholders) may be lower than the public float of other large public companies with broader public ownership.

Therefore, the trading price of our Common Stock may fluctuate significantly more than the stock market as a whole.

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A small number of our shareholders beneficially own a substantial amount of our Common Stock.

As of September 30, 2021, our five largest shareholders plus Dr.

Schleifer, our Chief Executive Officer, beneficially owned approximately 37.6% of our outstanding shares of Common Stock, assuming, in the case of our Chief Executive Officer, the conversion of his Class A Stock into Common Stock and the exercise of all options held by him which are exercisable within 60 days of September 30, 2021.

As of April 12, 2022, our five largest shareholders plus Dr.

Schleifer, our Chief Executive Officer, beneficially owned approximately 37.3% of our outstanding shares of Common Stock, assuming, in the case of our Chief Executive Officer, the conversion of his Class A Stock into Common Stock and the exercise of all options held by him which are exercisable within 60 days of April 12, 2022.

If our significant shareholders or we sell substantial amounts of our Common Stock in the public market, or there is a perception that such sales may occur, the market price of our Common Stock could fall.

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There can be no assurance that we will repurchase shares of our Common Stock or that we will repurchase shares at favorable prices.

In January 2021, our board of directors authorized a share repurchase program to repurchase up to $1.5 billion of our Common Stock.

In November 2021, our board of directors authorized a share repurchase program to repurchase up to $3.0 billion of our Common Stock (of which $2.493 billion remained available as of March 31, 2022).

There can be no assurance of any future share repurchases or share repurchase program authorizations.

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Holders of Class A Stock, who are generally the shareholders who purchased their stock from us before our initial public offering, are entitled to ten votes per share, while holders of Common Stock are entitled to one vote per share.

As of September 30, 2021, holders of Class A Stock held 14.8% of the combined voting power of all shares of Common Stock and Class A Stock then outstanding.

As of April 12, 2022, holders of Class A Stock held 14.4% of the combined voting power of all shares of Common Stock and Class A Stock then outstanding.

These shareholders, if acting together, would be in a position to substantially influence the election of our directors and the vote on certain corporate transactions that require majority or supermajority approval of the combined classes, including mergers and other business combinations.

This may result in our taking corporate actions that other shareholders may not consider to be in their best interest and may affect the price of our Common Stock.

As of September 30, 2021:

• our current executive officers and directors beneficially owned 7.7% of our outstanding shares of Common Stock, assuming conversion of their Class A Stock into Common Stock and the exercise of all options held by such persons which are exercisable within 60 days of September 30, 2021, and 19.0% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by such persons which are exercisable within 60 days of September 30, 2021;

As of April 12, 2022:

• our current executive officers and directors beneficially owned 7.2% of our outstanding shares of Common Stock, assuming conversion of their Class A Stock into Common Stock and the exercise of all options held by such persons which are exercisable within 60 days of April 12, 2022, and 18.5% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by such persons which are exercisable within 60 days of April 12, 2022;

• our five largest shareholders plus Dr.

In addition, these five shareholders plus our Chief Executive Officer held approximately 44.9% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by our Chief Executive Officer which are exercisable within 60 days of September 30, 2021.

In addition, these five shareholders plus our Chief Executive Officer held approximately 44.7% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by our Chief Executive Officer which are exercisable within 60 days of April 12, 2022.

The anti-takeover effects of provisions of our charter, by-laws, and of New York corporate law, as well as the contractual provisions in our investor and collaboration agreements and certain provisions of our compensation plans and agreements, could deter, delay, or prevent an acquisition or other "change of control" of us and could adversely affect the price of our Common Stock.

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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