What changed in this filing

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Item 1. Legal Proceedings

2024-08-06 compared with 2024-05-02 · 89 added, 90 removed, 1247 unchanged (13% of the section changed)

14 unchanged sentences

We have not yet demonstrated our ability to successfully complete any large-scale, pivotal clinical trials, obtain regulatory approvals, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful commercialization.

We have three product candidates in clinical development.

Our lead product candidates are in clinical development.

We may not be able to file INDs for any of our other product candidates on the timelines we expect, if at all.

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

We may develop future product candidates, in combination with one or more cancer therapies.

The uncertainty resulting from the use of our product candidates in combination with other cancer therapies may make it difficult to accurately predict side effects in future clinical trials.

We may develop future product candidates, in combination with one or more cancer or other therapies.

The uncertainty resulting from the use of our product candidates in combination with other therapies may make it difficult to accurately predict side effects in future clinical trials.

As is the case with many treatments for cancer and rare diseases, it is likely that there may be side effects associated with the use of our product candidates.

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We may focus our efforts and resources on potential product candidates or other potential programs that ultimately prove to be unsuccessful.

We intend to develop our current product candidates and potentially future product candidates, in combination with other therapies, which exposes us to additional risks.

We intend to develop our current product candidates, and may develop future product candidates, for use in combination with one or more currently approved cancer therapies.

We are developing certain current product candidates, may develop other current product candidates and potentially future product candidates, in combination with other therapies, which exposes us to additional risks.

We intend to develop our current product candidates, and may develop future product candidates, for use in combination with one or more currently approved cancer or other therapies.

Even if any product candidate we develop was to receive marketing approval or be commercialized for use in combination with other existing therapies, we would continue to bear the risks that the FDA or similar regulatory authorities could revoke approval of the therapy used in combination with our product candidates or that safety, efficacy, manufacturing or supply issues could arise with these existing therapies.

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This could result in our own products being removed from the market or being less successful commercially.

We may also evaluate our current product candidates or any other future product candidates in combination with one or more other cancer therapies that have not yet been approved for marketing by the FDA or similar regulatory authorities.

We will not be able to market and sell any of our product candidates we develop in combination with any such unapproved cancer therapies that do not ultimately obtain marketing approval.

Pursuant to the Genentech Agreement, Genentech has assumed the development of migoprotafib, including in combination with other compounds.

See " Business – Our Collaborations – License Agreements and Strategic Collaborations – Collaboration and License Agreement with Genentech " in our Annual Report on Form 10-K for the year ended December 31, 2023.

We also evaluate certain of our current product candidates and may in the future evaluate other current product candidates or any future product candidates in combination with one or more cancer or other therapies that have not yet been approved for marketing by the FDA or similar regulatory authorities.

We will not be able to market and sell any of our product candidates we develop in combination with any such unapproved therapies that do not ultimately obtain marketing approval.

In addition, in June 2024, we entered into a clinical trial collaboration with Pfizer to evaluate atirmociclib, Pfizer’s investigative selective-CDK4 inhibitor, in combination with RLY-2608 and fulvestrant in patients with PI3Kα-mutated, HR+, HER2- metastatic breast cancer.

If the FDA or similar regulatory authorities do not approve these other drugs or revoke their approval of, or if safety, efficacy, manufacturing, or supply issues arise with, the drugs we choose to evaluate in combination with our current product candidates or any product candidate we develop, we may be unable to obtain approval of or market any of the product candidates we develop.

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The FDA and similar authorities in other countries have substantial discretion in the approval process and may refuse to accept any application or may decide that our data are insufficient for approval and require additional nonclinical, clinical or other studies.

It is also unclear how FDA marketing approval policies along with FDA interpretations of law or regulatory discretion could change as a result of the U.S.

Supreme Court’s decision to overturn prior established case law giving deference to agency decisions and interpretations.

Our product candidates could be delayed in receiving, or fail to receive, regulatory approval for many reasons, including the following:

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If these collaborations are not successful, our business could be adversely affected.

We have entered into and may enter into collaborations with third parties for one or more of our programs or product candidates, such as our Genentech Agreement to develop and commercialize migoprotafib.

We have entered into and may enter into collaborations with third parties for one or more of our programs or product candidates.

If we enter into any such arrangements with any third parties, we will likely have limited control over the amount and timing of resources that any future collaborators dedicate to the development or commercialization of our product candidates.

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• Collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;

For example, Genentech has the first right to enforce or defend certain of our intellectual property rights under our collaboration, and although we may have the right to assume the enforcement and defense of such intellectual property rights if Genentech does not, our ability to do so may be compromised by Genentech’s actions;

• Disputes may arise with respect to the ownership of intellectual property developed pursuant to our collaborations;

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• Collaborations may be terminated for the convenience of the collaborator and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates.

For example, Genentech may terminate its collaboration with us for convenience after a specified notice period.

For example, Genentech notified us

on July 11, 2024 that it is terminating its collaboration with us for convenience, which termination will be effective 180 days after such notice.

If our collaborations do not result in the successful development and commercialization of products, or if one of any future collaborators terminates its agreement with us, we may not receive any milestone or royalty payments under the collaboration.

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Shaw Research on two early preclinical programs.

There can be no assurance that this collaboration will continue past the current term of the DESRES Agreement, on favorable terms or at all, or that at any time while the collaboration is in effect D.

We do not expect the initial research term under the DESRES Agreement to be mutually extended past its current end date, and there can be no assurance that at any time while the collaboration is in effect D.

Shaw Research will provide a level of service that benefits our programs in a meaningfully positive manner.

While we also have other computational collaborations, mostly focused on developing machine learning models, such collaborations do not provide a substitute for the technology made available through our collaboration with D.

While we also have other computational collaborations, mostly focused on developing machine learning models, such collaborations do not provide a direct substitute for the technology made available through our collaboration with D.

Shaw Research.

The termination of the DESRES Agreement or any significant reduction in our

collaboration with D.

Shaw Research would require us to rely more heavily on these other collaborations and our own internal resources, and may delay or impair our preclinical research efforts.

Furthermore, while the termination of the DESRES Agreement would not directly impact the development of our lead product candidates, we cannot predict the effects such termination could have on our preclinical studies and development efforts and our ability to discover and develop additional product candidates.

The expiration or termination of the DESRES Agreement or any significant reduction in our collaboration with D.

Shaw Research will require us to rely more heavily on these other

collaborations and our own internal resources, and could delay or impair our preclinical research efforts with respect to the preclinical programs on which we collaborate with D.E.

Shaw Research.

Furthermore, while the expiration or termination of the DESRES Agreement will not directly impact the development of our lead product candidates, we cannot predict the effects such expiration or termination could have on our preclinical studies and development efforts and our ability to discover and develop additional product candidates.

In particular, the technologies accessed through D.

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Moreover, we are subject to certain payment obligations under the DESRES Agreement, including payments to D.

Shaw Research in connection with certain transactions, including our collaboration with Genentech pursuant to the Genentech Agreement.

Shaw Research in connection with certain transactions.

These payment obligations may decrease the value to us of certain transactional opportunities or otherwise burden our ability to enter into such transactions.

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We are a biopharmaceutical company with a limited operating history and have incurred net losses in each year since our inception.

Our net losses were $81.4 million and $94.2 million for the three months ended March 31, 2024 and 2023, respectively.

We had an accumulated deficit of $1.5 million as of March 31, 2024.

Our net losses were $173.6 million and $192.7 million for the six months ended June 30, 2024 and 2023, respectively.

We had an accumulated deficit of $1.6 billion as of June 30, 2024.

Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk.

We commenced operations in May 2015.

Since inception, we have focused substantially all of our efforts and financial resources on developing our Dynamo drug discovery platform and initial product candidates.

Since inception, we have focused substantially all of our efforts and financial resources on developing our Dynamo drug discovery platform and product candidates.

We have no products approved for commercial sale and therefore have never generated any revenue from product sales, and we do not expect to in the foreseeable future.

have not obtained regulatory approvals for any of our product candidates and there is no assurance that we will obtain approvals in the future.

We have not obtained regulatory approvals for any of our product candidates and there is no assurance that we will obtain approvals in the

We expect to continue to incur significant expenses and operating losses over the next several years and for the foreseeable future.

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Our ability to become profitable depends upon our ability to generate revenue.

To date, we have no products approved for commercial sale, we have not generated any revenue from our product sales and we do not expect to generate any revenue from the sale of products in the

To date, we have no products approved for commercial sale, we have not generated any revenue from our product sales and we do not expect to generate any revenue from the sale of products in the near future.

We do not expect to generate significant revenue unless and until we obtain marketing approval of, and begin to sell one or more of our product candidates.

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• the success of any existing or future collaborations that we may enter into with third parties;

• the extent to which we acquire or invest in businesses, products and technologies, including entering into licensing or collaboration arrangements for product candidates, such as our collaboration with Genentech;

• the extent to which we acquire or invest in businesses, products and technologies, including entering into licensing or collaboration arrangements for product candidates;

• the achievement of milestones or occurrence of other developments that trigger payments under any existing or future collaboration agreements, if any;

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We could also be required to seek funds through arrangements with collaborators or otherwise at an earlier stage than otherwise would be desirable and we may be required to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects.

capitalize on our business opportunities, as desired, which could materially affect our business, financial condition and results of operations.

If we are unable to obtain funding on a timely basis, we may be required to significantly curtail, delay or discontinue one or more of our research or development programs or the commercialization of any product candidate or be unable to expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our business, financial condition and results of operations.

Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates.

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We do not have any committed external source of funds.

To the extent that we raise additional capital through the sale of common stock or securities convertible or exchangeable into common stock, the ownership interest of our stockholders will be diluted, and the terms of those securities may include liquidation or other preferences that materially adversely affect their rights as a common stockholder.

may include liquidation or other preferences that materially adversely affect their rights as a common stockholder.

We may offer and sell up to an aggregate amount of $300.0 million of our common stock from time to time in "at the market" offerings pursuant to the sales agreement, or the Sales Agreement, with Cowen and Company, LLC, subject to the limitations thereof.

As of March 31, 2024, we have sold 4,915,669 shares of common stock under the Sales Agreement.

As of June 30, 2024, we have sold 4,915,669 shares of common stock under the Sales Agreement.

Debt financing, if available, would increase our fixed payment obligations and may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends.

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Continued economic uncertainty caused by these and other factors, including political instability, conflicts or crises, at the global level or involving individual countries or regions and any associated economic sanctions, could result in a variety of risks to our business, including difficulty in enrolling participants in our clinical trials, difficulty in forecasting our financial results and managing inventory levels, increases in our business costs, which in turn affect our ability to develop our current and future product candidates, and negatively impacting our ability to raise additional capital when needed on acceptable terms, if at all.

In addition, political developments impacting government spending and international trade, including changes in trade agreements, potential government shutdowns and trade disputes

and tariffs, such as the ongoing trade dispute between the United States and China, may negatively impact markets and cause weaker macroeconomic conditions.

In addition, political developments impacting government spending and international trade, including changes in trade agreements, potential government shutdowns and trade disputes and tariffs, such as the ongoing trade dispute between the United States and China, may negatively impact markets and cause weaker macroeconomic conditions.

These global economic and political factors have also strained and could continue to strain certain of our suppliers and manufacturers, possibly resulting in supply disruptions or increased raw material or manufacturing costs, or adversely impacting their ability to manufacture clinical trial materials for our product candidates.

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Other than our U.S.

patent relating to migoprotafib (RLY-1971, now referred to as GDC-1971) composition of matter and our U.S.

patent relating to lirafugratinib (RLY-4008) composition of matter, we do not own or in-license any issued patents relating to our platform or our lead product candidates under clinical development.

Pursuant to the Genentech Agreement, we have granted an exclusive, worldwide, royalty-bearing license to Genentech, with the right to sublicense, develop and commercialize migoprotafib and any other SHP2 inhibitors developed under the Genentech Agreement.

Genentech has the first right, but not the obligation, to file, prosecute and maintain any patents licensed to it, as well as to enforce infringement of or defend claims against such patents that relate to migoprotafib or other SHP2 inhibitors.

See " Risks Related to Our Reliance on Third Parties— We have and may enter into other collaborations with third parties for the research, development, manufacture and commercialization of one or more of our programs or product candidates.

If these collaborations are not successful, our business could be adversely affected ." for a discussion of risks related to the protection of our intellectual property rights under our collaborations.

Most of the research and development for our programs has been performed under the DESRES Agreement.

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The degree of patent protection we require to successfully commercialize our product candidates may be unavailable or severely limited in some cases and may not adequately protect our rights or permit us to gain or keep any competitive advantage.

We cannot provide any assurances that any of our pending patent applications will issue, or that any of our pending patent applications that mature into issued

patents will include claims with a scope sufficient to protect our lead product candidates under clinical development or our other product candidates.

We cannot provide any assurances that any of our pending patent applications will issue, or that any of our pending patent applications that mature into issued patents will include claims with a scope sufficient to protect our lead product candidates under clinical development or our other product candidates.

In addition, the laws of foreign countries may not protect our rights to the same extent as the laws of the United States.

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We have licensed patent rights, and in the future may license additional patent rights, to or from third parties.

For example, we have licensed our patent rights to our SHP2 program to Genentech.

These licensed patent rights may be valuable to our business, and we may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology or medicines underlying such licenses.

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An adverse determination in any such submission or proceeding may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop others from using or commercializing similar or identical technology and products, without payment to us, or could limit the duration of the patent protection covering our technology and product candidates.

Such challenges may also result in our inability to manufacture or commercialize our

product candidates without infringing third party patent rights.

Such challenges may also result in our inability to manufacture or commercialize our product candidates without infringing third party patent rights.

In addition, if the breadth or strength of protection provided by our patents and patent applications is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates.

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Given the vast number of patents in our field of technology, we cannot be certain that we do not infringe existing patents or that we will not infringe patents that may be granted in the future.

Many companies have filed, and continue to file, patent applications related to SHP2 inhibitors, FGFR2 inhibitors and PI3K inhibitors.

Many companies have filed, and continue to file, patent applications related to FGFR2 inhibitors and PI3K inhibitors.

Some of these patent applications have already been allowed or issued, and others may issue in the future.

Since these areas are competitive and of strong interest to pharmaceutical and biotechnology companies, there will likely be additional patent applications filed and additional patents granted in the future, as well as additional research and development programs expected in the future.

expected in the future.

Furthermore, because patent applications can take many years to issue and may be confidential for 18 months or more after filing, and because pending patent claims can be revised before issuance, there may be applications now pending which may later result in issued patents that may be infringed by the manufacture, use or sale of our product candidates, or the practice of our technology.

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The outcome of any such proceeding is generally unpredictable.

Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or

non-enablement.

Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement.

Patents may be unenforceable if someone connected with prosecution of the patent withheld relevant information from the USPTO or made a misleading statement during prosecution.

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Intellectual property litigation could cause us to spend substantial resources and distract our personnel from their normal responsibilities.

Litigation or other legal proceedings relating to intellectual property claims, with or without merit, is unpredictable and generally expensive and time consuming and is likely to divert significant resources from our core business, including distracting our technical and management personnel from their normal responsibilities.

personnel from their normal responsibilities.

Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation.

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A patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval, only one patent may be extended and only those claims covering the approved drug, a method for using it or a method for manufacturing it may be extended.

However, we may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within

applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements.

However, we may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements.

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

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While we primarily rely on our own internal computational capabilities, we currently actively collaborate with D.

Shaw Research on two preclinical research programs, and there can be no assurance that this collaboration will continue past the current term of the DESRES Agreement, on favorable terms or at all, or that at any time while the collaboration is in effect D.

Shaw Research on two preclinical research programs, and we do not expect the initial research term under the DESRES Agreement to be mutually extended past its current end date.

There can be no assurance that at any time while the collaboration is in effect D.

Shaw Research will provide any particular level of services or that the parties will operate under the agreement without disputes.

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In addition, the DESRES Agreement is complex and certain provisions may be susceptible to multiple interpretations.

The resolution of any contract interpretation disagreement that may arise could be adverse to us, for example by narrowing what we believe to be the scope of our rights to certain intellectual property, or increasing what we believe to be our financial or other obligations under the DESRES Agreement, and any such outcome could have a material adverse effect on our business, financial condition, results of operations, and prospects.

The resolution of any contract interpretation disagreement that may arise could be adverse to us, for example by narrowing what we believe to be the scope

of our rights to certain intellectual property, or increasing what we believe to be our financial or other obligations under the DESRES Agreement, and any such outcome could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Risks Related to Intellectual Property Laws

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In the event we decide to conduct clinical trials or continue to enroll subjects in our ongoing or future clinical trials, we may be subject to additional data collection restrictions.

Privacy and data security have become significant issues in the U.S., Europe and in many other jurisdictions where we conduct or may in the future conduct our operations.

Privacy and data security have become significant issues in the U.S., Europe and in many other

jurisdictions where we conduct or may in the future conduct our operations.

The regulatory framework for the collection, use, safeguarding, sharing and transfer of information worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future.

For example, the collection, use, storage, disclosure, transfer, or other processing of personal data of individuals in the EEA, including personal health data, is subject to the GDPR.

The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including requirements relating to processing health and other sensitive data, providing notice to the individuals to whom the personal data relates regarding data processing activities, implementing safeguards to protect the privacy and security of personal data, implementing processes to handle requests from individuals to exercise their data protection rights, maintaining records of our processing activities and to document data protection impact assessments where there is high risk processing, providing notification of data breaches in certain circumstances, and taking certain measures when engaging third-party processors or sub-processors.

The GDPR focuses on accountability of data controllers (such as us) and requires us to put in place all technical and organizational measures (privacy by design and by default) to ensure that we meet our obligations.

The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including requirements relating to having a legal basis for processing personal data, stricter requirements relating to the processing of sensitive data (such as health data), where required by GDPR, obtaining consent of the individuals to whom personal data relates, providing notice to the individuals to whom the personal data relates regarding data processing activities, implementing safeguards to protect the privacy and security of personal data, implementing processes to handle requests from individuals to exercise their data protection rights, maintaining records of our processing activities and to document data protection impact assessments where there is high risk processing, providing notification of data breaches in certain circumstances, and taking certain measures when engaging third-party processors or sub-processors.

The GDPR focuses on accountability of controllers (such as us) and requires us to put in place all technical and organizational measures (privacy by design and by default) to ensure that we meet our obligations.

Penalties under the GDPR include fines of up to €10,000,000 or up to 2% of our total worldwide annual turnover for certain comparatively minor offenses, or up to €20,000,000 or up to 4% of our total worldwide annual turnover for more serious offenses.

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Likewise, the UK government has confirmed that personal data transfers from the UK to the EEA remain free flowing.

The UK Government has introduced a Data Protection and Digital Information Bill, or UK Bill, into the UK legislative process.

The aim of the UK Bill is to reform the UK’s data protection regime following Brexit.

The UK Government introduced a Data Protection and Digital Information Bill, or UK Bill, into the UK legislative process.

The aim of the UK Bill was to reform the UK’s data protection regime following Brexit.

The Bill failed to complete the legislative passage in the necessary timeframe, and is intended to be reintroduced into the next Parliament.

If passed, the final version of the UK Bill may have the effect of further altering the similarities between the UK and EEA data protection regime and threaten the UK Adequacy Decision from the European Commission, or EC.

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On the basis of the new adequacy decision, personal data can flow safely from the EU to U.S.

companies participating in the Framework, without having to

put in place additional data protection safeguards.

companies participating in the Framework, without having to put in place additional data protection safeguards.

There has been an extension to the Framework to cover UK transfers to the U.S.

The Framework could be challenged like its predecessor frameworks.

This complexity and the additional contractual burden could increase our overall risk exposure.

There may be further divergence in the future, including with regard to administrative burdens.

However, the long term validity of the Framework, which has already been challenged in court, remains uncertain.

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In addition to European data protection requirements, we may be subject to various privacy laws in the United States at the state and federal level.

In the United States, at the state level, for example, California Consumer Privacy Act (CCPA), which took effect on January 1, 2020, imposes sweeping privacy and security obligations on many companies doing business in California and provides for substantial fines for non-compliance and, in some cases, a private right of action to consumers who are victims of data breaches involving their unredacted or unencrypted personal information.

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

In the United States, at the state level, for example, California Consumer Privacy Act (CCPA) imposes sweeping privacy and security obligations on many companies doing business in California and provides for substantial fines for non-compliance and, in some cases, a private right of action to consumers who are victims of data breaches involving their unredacted or unencrypted personal information.

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

The CCPA became enforceable as of July 1, 2020, but there continues to be uncertainty about how the law will be interpreted and enforced.

Additionally, the California Privacy Rights Act (CPRA) became effective on January 1,

The CPRA imposes additional obligations on companies covered by the legislation and significantly modifies the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information.

The CPRA also creates a new state agency that will be vested with authority to implement and enforce the CCPA and the CPRA.

As of January 1, 2023, the privacy protections of the CPRA also apply to personal information of contacts collected in a business to business capacity and from employment applicants, employees and former employees.

The effects of the CCPA and the CPRA are potentially significant and may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation.

Furthermore, four other states have enacted comprehensive consumer privacy laws and many others are considering proposals for such laws.

The CCPA (as amended by the CPRA) imposes additional obligations on companies covered by the legislation and significantly modified the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information.

The CPRA amendments also created a new state agency that will be vested with authority to implement and enforce the CCPA.

The privacy protections of the CCPA also apply to personal information collected in a business to business capacity and from employment applicants, employees and former employees.

The effects of the CCPA are potentially significant and may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation.

Furthermore, a number of other states have either enacted comprehensive consumer privacy laws similar to the CCPA or are considering proposals for such similar laws, many of which vary in complexity and may be interpreted and enforced differently, thus potentially complicating our compliance efforts.

The increasing number and complexity of regional, country and U.S.

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To be successful, we or our collaborators will need to address a number of scientific, technical, regulatory and logistical challenges.

The FDA and similar foreign regulatory authorities regulate in vitro companion diagnostics as medical devices and,

under that regulatory framework, will likely require the conduct of clinical trials to demonstrate the safety and effectiveness of any diagnostics we may develop, which we expect will require separate regulatory clearance or approval prior to commercialization.

The FDA and similar foreign regulatory authorities regulate in vitro companion diagnostics as medical devices and, under that regulatory framework, will likely require the conduct of clinical trials to demonstrate the safety and effectiveness of any diagnostics we may develop, which we expect will require separate regulatory clearance or approval prior to commercialization.

We rely and intend to continue to rely on third parties for the design, development and manufacture of companion diagnostic tests for our therapeutic product candidates that may require such tests.

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If we are unable to successfully develop companion diagnostics for these therapeutic product candidates, or experience delays in doing so, the development of these therapeutic product candidates may be adversely affected, these therapeutic product candidates may not obtain marketing approval, and we may not realize the full commercial potential of any of these therapeutics that obtain marketing approval.

As a result, our business, results of operations and financial condition could be materially harmed.

result, our business, results of operations and financial condition could be materially harmed.

In addition, a diagnostic company with whom we contract may decide to discontinue selling or manufacturing the companion diagnostic test that we anticipate using in connection with development and commercialization of our product candidates or our relationship with such diagnostic company may otherwise terminate.

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Violations of Trade Laws can result in substantial criminal fines and civil penalties, imprisonment, the loss of trade privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.

We have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities, and

other organizations.

We have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities, and other organizations.

We also expect our non-U.S.

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(2) either (a) such condition affects no more than five in 10,000 persons in the EU when the application is made, or (b) the product, without the benefits derived from orphan status, would not generate sufficient return in the EU to justify the necessary investment in its development;

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

the condition.

In the EU, orphan designation entitles a party to financial incentives such as reduction of fees or fee waivers.

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In addition, a designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan drug designation.

Moreover, orphan drug exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the rare disease or condition or if another drug with the same active moiety is determined to be safer, more effective, or represents a major contribution to patient care.

Moreover, orphan drug exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or if the

manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the rare disease or condition or if another drug with the same active moiety is determined to be safer, more effective, or represents a major contribution to patient care.

Orphan drug designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.

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If granted, accelerated approval is usually contingent on the sponsor’s agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to verify and describe the drug’s clinical benefit.

Under FDORA, the FDA is permitted to require, as appropriate, that a post-approval confirmatory study or studies be underway prior to approval or within a specified time period after the

date of approval for a product granted accelerated approval.

Under FDORA, the FDA is permitted to require, as appropriate, that a post-approval confirmatory study or studies be underway prior to approval or within a specified time period after the date of approval for a product granted accelerated approval.

FDORA also requires sponsors to send updates to the FDA every 180 days on the status of such studies, including progress toward enrollment targets, and the FDA must promptly post this information publicly.

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For example, over the last several years the U.S.

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

stop critical activities.

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

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

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We expect to expand our development and regulatory capabilities and potentially implement sales, marketing and distribution capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.

As of March 31, 2024, we had 309 full-time employees.

As of June 30, 2024, we had 304 full-time employees.

In the future, we expect to experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of pharmaceutical and clinical development, regulatory affairs and, if any of our product candidates receives marketing approval, sales, marketing and distribution.

To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel.

To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit

and train additional qualified personnel.

Due to our limited financial resources and the limited experience of our management team in managing a company with such anticipated growth, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel.

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While we maintain liability insurance at levels that we believe are appropriate for our business, we cannot assure our investors that it will be sufficient in type or amount to cover us against all claims related to security compromises or breaches, cyberattacks and other related breaches.

expend significant amounts of money and other resources to repair, remediate, or replace our information systems or networks, the market perception of the effectiveness of our security measures could be harmed and our reputation and credibility could be damaged.

Furthermore, any failure or perceived failure by us or any third-party collaborators, service providers, contractors or consultants to comply with our privacy, confidentiality, data security or similar obligations to third parties, or any data security incidents or other security compromises or breaches that result in the unauthorized access, use, acquisition, disclosure, release or transfer of confidential or sensitive information, including physician data, patient data, or any personally identifiable information, may result in governmental investigations, enforcement actions, regulatory fines, litigation or public statements against us, could cause third parties to lose trust in us or could result in claims by third parties asserting that we have breached our privacy, confidentiality, data security or similar obligations, any of which could have a material adverse effect on our reputation, business, financial condition or results of operations.

To the extent that any disruption or security compromises, incident, or breach were to result in a loss of, or damage to, our systems, infrastructure, data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability, our competitive position could be harmed, the further development and commercialization of our product candidates or any future product candidates could be hindered or delayed, we could be required to expend significant amounts of money and other resources to repair, remediate, or replace our information systems or networks, the market perception of the effectiveness of our security measures could be harmed and our reputation and credibility could be damaged.

claims by third parties asserting that we have breached our privacy, confidentiality, data security or similar obligations, any of which could have a material adverse effect on our reputation, business, financial condition or results of operations.

Moreover, data security incidents and other security compromises and breaches can be difficult to detect, and any delay in identifying or remediating them may lead to increased harm.

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However, in the event of an accident or incident at these facilities, we cannot assure our investors that the amounts of insurance will be sufficient to satisfy any damages and losses.

If our facilities or the facilities of our third-party contract manufacturers or CROs are unable to operate because of an accident or incident or for any other reason, even for a short period of time, any or all of our research and development programs may be

Any business interruption may have a material and adverse effect on our business, financial condition, results of operations and prospects.

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The market price for our common stock historically has been volatile and could continue to be subject to wide fluctuations in response to various factors.

Since shares of our common stock were sold in our initial public offering, or IPO, in July 2020 at a price of $20.00 per share, our stock price has fluctuated significantly, ranging from an intraday low of $5.70 to an intraday high of $64.37 through April 26, 2024.

This volatility may affect the price at which you could resell the common stock.

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Our executive officers, directors, principal stockholders and their affiliates exercise significant control over our company, which will limit your ability to influence corporate matters and could delay or prevent a change in corporate control.

As of March 31, 2024, the holdings of our executive officers, directors, principal stockholders and their affiliates, represented beneficial ownership, in the aggregate, of approximately 51.0% of our outstanding common stock.

As a result, these stockholders, if they act together, will be able to influence our management and affairs and control the outcome of matters submitted to our stockholders for approval, including the election of directors and any sale, merger, consolidation, or sale of all or substantially all of our assets.

As of June 30, 2024, the holdings of our executive officers, directors, principal stockholders and their affiliates, represented beneficial ownership, in the aggregate, of approximately 50.9% of our outstanding common stock.

As a result, these stockholders, if they act together,

will be able to influence our management and affairs and control the outcome of matters submitted to our stockholders for approval, including the election of directors and any sale, merger, consolidation, or sale of all or substantially all of our assets.

These stockholders may have interests, with respect to their common stock, that are different from those of our public market investors and the concentration of voting power among these stockholders may have an adverse effect on the price of our common stock.

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As a public company, we have incurred and expect to incur significant legal, accounting and other expenses.

In addition, the Sarbanes-Oxley Act of 2002 and rules subsequently implemented by the SEC and Nasdaq have imposed various requirements on public companies,

including establishment and maintenance of effective disclosure and financial controls and corporate governance practices.

In addition, the Sarbanes-Oxley Act of 2002 and rules subsequently implemented by the SEC and Nasdaq have imposed various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices.

Our management and other personnel devote a substantial amount of time to these compliance initiatives.

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Despite our efforts, there is a risk that neither we nor our independent registered public accounting firm will be able to conclude within the prescribed timeframe that our internal control over financial reporting is effective as required by Section 404 or that we will not be able to comply with the requirements of Section 404 in a timely manner.

This could result in an adverse reaction in the financial markets due to a loss of confidence in the reliability of our financial statements.

This could result in an adverse reaction in the financial markets due to a loss of confidence in the

reliability of our financial statements.

In addition, if we are not able to continue to meet these requirements, we may not be able to remain listed on Nasdaq.

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In addition, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporate Law, which may prohibit certain business combinations with stockholders owning 15% or more of our outstanding voting stock.

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

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

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

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(2) any action asserting a claim of or based on a breach of a fiduciary duty owed by any director, officer or other employee of ours to us or our stockholders;

(3) any action asserting a claim pursuant to any provision of the Delaware General Corporation Law, our Certificate of Incorporation or our Bylaws;

(3) any action asserting a claim pursuant to any provision of the Delaware General Corporation Law, our Certificate of

Incorporation or our Bylaws;

or (4) any action asserting a claim governed by the internal affairs doctrine, or the Delaware Forum Provision.

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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 1. Legal Proceedings