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Since inception, we have incurred significant operating losses in every year.
−Removed: Our net loss was $55.4 million for the year ended December 31, 2019 and $65.3 million for each of the years ended December 31, 2018 and 2017, respectively.
+Added: Our net losses were $68.9 million for the year ended December 31, 2020, and $55.4 million and $65.3 million for each of the years ended December 31, 2019 and 2018, respectively.
As of December 31, 2020, we had an accumulated deficit of $404.6 million.
−Removed: To date, we have financed our operations primarily through the public offering and private placements of our securities, funding received from research grants and collaboration arrangements and our credit facility.
+Added: To date, we have financed our operations primarily through public offerings and private placements of our securities, funding received from research grants and collaboration arrangements and our credit facility.
We currently have no source of product revenue, and we do not expect to generate product revenue for the foreseeable future.
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We expect that our expenses will increase substantially as we:
−Removed: conduct additional clinical trials of SEL‑212, our lead product candidate;
−Removed: continue the research and development of our other product candidates;
+Added: • continue the research and development of our product candidates;
• seek to enhance our ImmTOR platform and discover and develop additional product candidates;
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• maintain, expand and protect our intellectual property portfolio, including through licensing arrangements;
−Removed: add clinical, scientific, operational, financial and management information systems and personnel, including personnel to support our product development and potential future commercialization efforts and to support our operations as a public company;
+Added: • add clinical, scientific, operational, financial and management information systems and personnel, including personnel to support our product development and potential future commercialization efforts;
• experience any delays or encounter any issues with any of the above, including, but not limited to, failed studies, complex results, safety issues or other regulatory, manufacturing or scale-up challenges.
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Because of the numerous risks and uncertainties associated with pharmaceutical and biological product development, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to achieve profitability.
−Removed: If we are required by the FDA or other regulatory authorities to perform studies in addition to those currently expected, or if there are any delays in completing our clinical trials or the development of any of our product candidates, our expenses could increase and revenue could be further delayed.
+Added: If we are required by the FDA or other regulatory authorities to perform studies in addition to those currently expected, or if there are any delays in completing our clinical trials or the development of any of our product candidates, our expenses could increase and product revenue could be further delayed.
Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.
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We will need substantial additional funding in order to complete development of our product candidates and commercialize our products, if approved.
−Removed: If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts .
−Removed: We expect our expenses to increase in connection with our ongoing activities, particularly as we conduct our clinical trials of SEL‑212, continue to develop our gene therapy program, including our collaboration with AskBio, and continue research and development for our other product candidates.
+Added: If we are unable to raise capital when needed and on terms favorable to us, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts .
+Added: We expect our expenses to increase in connection with our ongoing activities, particularly as we continue to develop our gene therapy program, including our collaboration with AskBio, research and develop our autoimmune program, and continue research and development for our other product candidates.
In addition, if we obtain regulatory approval for any of our product candidates, we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution.
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If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or eliminate our clinical trials, our other research and development programs or any future commercialization efforts.
−Removed: We believe that our existing cash, cash equivalents, investments, and restricted cash as of December 31, 2019 will enable us to fund our operating expenses and capital expenditure requirements into the first quarter of 2021.
−Removed: We plan to commence our Phase 3 clinical program in SEL-212 in the second half of 2020.
−Removed: Because our current operating plan does not contain sufficient resources, we will require additional external sources of capital to complete the planned Phase 3 clinical program for SEL-212.
+Added: We believe that our existing cash, cash equivalents and restricted cash as of December 31, 2020 will enable us to fund our operating expenses and capital expenditure requirements into the second quarter of 2023.
We have based this estimate on assumptions that may prove to be wrong, and we could use our capital resources sooner than we currently expect.
−Removed: Because of the uncertainty in securing additional capital, we have concluded that substantial doubt exists with respect to our ability to continue as a going concern within one year after the date of the filing of this Annual Report on Form 10-K .
−Removed: Moreover, under the terms of the MIT License, MIT may terminate the MIT License if we fail to meet a diligence obligation, including the initiation of a Phase 3 clinical trial by a specified date in the fourth quarter of 2019.
−Removed: If we are unable to reach an agreement with MIT regarding an acceptable amendment of the MIT License and if we are unable to cure the breach, which is currently tolled until the earlier of (i) a specified date in the second quarter of 2020 or (ii) the effective date of a written amendment to the MIT Agreement, there could be a material adverse effect on our business.
−Removed: See “Business - Licenses and Collaborations – Massachusetts Institute of Technology.”
Our future capital requirements will depend on many factors, including:
−Removed: the scope, progress, results and costs of our clinical trials of SEL‑212;
+Added: • the scope, progress, results and costs of our clinical trials, preclinical development, and laboratory testing;
• the number of product candidates that we pursue;
• our collaboration agreements remaining in effect, our entering into additional collaboration agreements and our ability to achieve milestones under these agreements;
−Removed: the cost of manufacturing clinical supplies of our product candidates;
• our headcount growth and associated costs;
−Removed: the scope, progress, results and costs of preclinical development, laboratory testing and clinical trials for our other product candidates;
• the costs, timing and outcome of regulatory review of our product candidates;
• the costs and timing of future commercialization activities, including manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval;
−Removed: the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval;
+Added: • the revenue, if any, from commercial sales of our product candidates for which we receive marketing approval;
• the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims;
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In addition, we cannot guarantee that future financing will be available in sufficient amounts or on terms acceptable to us, if at all.
+Added: Market volatility resulting from the COVID-19 pandemic or other factors could also adversely impact our ability to access capital as and when needed.
Moreover, the terms of any financing may adversely affect the holdings or the rights of our stockholders, and the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our shares to decline.
The sale of additional equity or convertible securities would dilute all of our stockholders.
−Removed: The incurrence of indebtedness could result in increased fixed payment obligations and we may be required to agree to certain restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions
−Removed: that could adversely impact our ability to conduct our business.
+Added: The incurrence of indebtedness could result in increased fixed payment obligations and we may be required to agree to certain restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business.
We could also be required to seek funds through arrangements with collaborators or others 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.
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, including our clinical trial programs, or the commercialization of any product candidates, or be unable to sustain or expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our business, financial condition and results of operations.
−Removed: Our recurring losses from operations and negative cash flows from operations raise substantial doubt regarding our ability to continue as a going concern.
−Removed: As of December 31, 2019 and December 31, 2018 , we had an accumulated deficit of $335.8 million and $ 280.4 million, respectively.
−Removed: We anticipate operating losses to continue for the foreseeable future due to, among other things, costs related to research, development of our product candidates, conducting preclinical studies and clinical trials, and our administrative organization.
−Removed: We will require substantial additional financing to fund our operations and to continue to execute our strategy, and we will pursue a range of options to secure additional capital.
−Removed: These conditions raise substantial doubt about our ability to continue as a going concern within one year after the date of filing this Annual Report on Form 10-K .
−Removed: We are exploring various sources of funding such as strategic collaborations and the issuance of equity to fund our operations.
−Removed: If we raise additional funds through strategic collaborations and alliances, which may include existing collaboration partners, we may have to relinquish valuable rights to our technologies or product candidates, or, grant licenses on terms that are not favorable to us.
−Removed: To the extent that we raise additional capital through the sale of equity, the ownership interest of our existing shareholders will be diluted and other preferences may be necessary that adversely affect the rights of existing shareholders.
−Removed: Because our current operating plan does not contain sufficient resources, we will require additional external sources of capital to complete the planned Phase 3 clinical program for SEL-212.
−Removed: If we are unable to raise sufficient capital, we intend to curtail expenses contemplated by the current operating plan, and we may be required to delay, limit, reduce or terminate our product development efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.
−Removed: If the foregoing plans are unsuccessful and we are unable to continue as a going concern, you could lose all or part of your investment in the company.
−Removed: Our limited operating history may make it difficult for you to evaluate the success of our business to date and to assess our future viability.
−Removed: We commenced active operations in 2007, and our operations to date have been limited to developing and researching our ImmTOR platform and related products and programs, building our intellectual property portfolio, developing our supply chain, planning our business, raising capital and providing general and administrative support for these operations.
−Removed: Other than SEL-212, our lead product candidate, our other product candidates are still in preclinical development.
−Removed: While we have completed our early development clinical trials and a Phase 2 clinical trial for SEL‑212, we have not completed a clinical trial for any other product candidate, nor have we demonstrated our ability to successfully complete any Phase 3 or other 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 product commercialization.
−Removed: Additionally, we expect our financial condition and operating results to continue to fluctuate significantly from quarter‑to‑quarter and year‑to‑year due to a variety of factors, many of which are beyond our control.
−Removed: Consequently, any predictions you make about our future success or viability may not be as accurate as they could be if we had a longer operating history.
The terms of our credit facility place restrictions on our operating and financial flexibility.
If we raise additional capital through debt financing, the terms of any new debt could further restrict our ability to operate our business.
−Removed: On September 12, 2017, we entered into a term loan facility of up to $21.0 million with Silicon Valley Bank, or SVB.
−Removed: The term loan facility is governed by a loan and security agreement, dated September 12, 2017, between us and SVB, which was funded in full on September 13, 2017.
−Removed: The term loan facility with SVB is secured by a lien on substantially all of our assets, other than intellectual property, provided that such lien on substantially all assets includes any rights to payments and proceeds from the sale, licensing or disposition of intellectual property.
−Removed: We also granted SVB a negative pledge with respect to our intellectual property.
−Removed: The term loan facility contains customary covenants and representations, including but not limited to financial reporting obligations and limitations on dividends, indebtedness, collateral, investments, distributions, transfers, mergers or acquisitions, taxes, corporate changes, deposit accounts, and subsidiaries.
−Removed: The term loan facility also contains other customary provisions, such as expense reimbursement, non-disclosure obligations as well as indemnification rights for the benefit of SVB.
−Removed: The events of default under the term loan facility include, but are not limited to, our failure to make any payments of principal or interest under the term loan facility or other transaction documents, our breach or default in the performance of any covenant under the
−Removed: term loan facility or other transaction documents, the occurrence of a material adverse effect, making a false or misleading representation or warranty in any material respect under the term loan facility, our insolvency or bankruptcy, any attachment or judgment on our assets of at least approximately $0.3 million , or the occurrence of any default under any of our agreements or obligations involving indebtedness in excess of approximately $0.3 million .
−Removed: If an event of default occurs, SVB is entitled to take enforcement action, including acceleration of amounts due under the term loan facility.
+Added: On August 31, 2020, we entered into a term loan, or the 2020 Term Loan, of up to $35.0 million, consisting of term loans in an aggregate amount of $25.0 million, or the Term A Loan, and term loans in an aggregate amount of $10.0 million, or the Term B Loan, governed by a loan and security agreement among us and Oxford Finance LLC, or Oxford, as collateral agent and a lender, and Silicon Valley Bank, or SVB, as a lender.
+Added: The Term A Loan was funded in full on August 31, 2020, the proceeds of which were used to repay our previously existing 2017 term loan and for general corporate and working capital purposes.
+Added: The Term B Loan will be available, subject to Oxford’s discretion and customary terms and conditions, during the period commencing on the date we have delivered to Oxford and SVB evidence:
+Added: (i) we or one of our collaboration partners has enrolled its first randomized patient for a Phase 1 clinical trial evaluating the treatment of MMA and (ii) we have enrolled the
+Added: first patient in each of two Phase 3 pivotal trials evaluating SEL-212, or the Second Draw Period Milestone, and ending on the earliest of (i) the date which is 30 days following the date the Second Draw Period Milestone is achieved, (ii) September 30, 2021 (iii) and the occurrence of an event of default, other than an event of default that has been waived in writing by Oxford and SVB in their sole discretion.
+Added: Because we have enrolled the first patient in each of our two Phase 3 trials for SEL-212, the Second Draw Period Milestone has been achieved, and we expect the Term B Loan will be available to be drawn, once we or AskBio enroll the first randomized patient in our planned Phase 1 clinical trial evaluating the treatment of MMA.
+Added: The 2020 Term Loan is secured by a lien on substantially all of our assets, other than intellectual property, provided that such lien includes any rights to payments and proceeds from the sale, licensing or disposition of intellectual property.
+Added: We also granted Oxford a negative pledge with respect to our intellectual property.
+Added: Failure to satisfy our current and future debt obligations, including covenants to take or avoid specific actions, under the 2020 Term Loan could result in an event of default, our lenders could accelerate all of the amounts due.
If we raise any additional debt financing, the terms of such additional debt could further restrict our operating and financial flexibility.
−Removed: Changes in U.S.
−Removed: tax law may materially adversely affect our financial condition, results of operations and cash flows.
−Removed: The Tax Cuts and Jobs Act of 2017, or TCJA, has significantly changed the U.S.
−Removed: federal income taxation of U.S.
−Removed: corporations.
−Removed: The TCJA remains unclear in many respects and has been, and may continue to be, the subject of amendments and technical corrections, as well as interpretations and implementing regulations by the Treasury and Internal Revenue Service, which have lessened or increased certain adverse impacts of the TCJA and may do so in the future.
−Removed: We continue to work with our tax advisors and auditors to determine the full impact that the TCJA will have on us.
−Removed: We urge our investors to consult with their legal and tax advisors with respect to the TCJA.
Our ability to use our net operating loss and research and development tax credit carryforwards to offset future taxable income may be subject to certain limitations.
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Under the TCJA, although the treatment of NOLs arising on or before December 31, 2017 has generally not changed, NOLs arising on or after January 1, 2018 will generally only be able to offset 80% of taxable income.
+Added: Subsequently, in March 2020, the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, removed the 80% limitation rule for tax years 2018 through 2020, and as of taxable years beginning on or after January 1, 2021, the 80% limitation has been reinstated.
This change may require us to pay federal income taxes in future years despite generating a loss for federal income tax purposes in prior years.
−Removed: RISKS RELATED TO THE DISCOVERY, DEVELOPMENT AND REGULATORY APPROVAL OF OUR PRODUCT CANDIDATES
+Added: Risks Related to the Development of our Product Candidates
Our product candidates are based on our ImmTOR platform, which is an unproven approach designed to induce antigen-specific immune tolerance to biologic drugs.
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All of our product candidates are derived from our ImmTOR platform, which is an unproven approach to induce antigen-specific immune tolerance and to mitigate the immunogenicity of biologic therapies currently being implemented to treat patients.
−Removed: We are primarily developing our ImmTOR platform to improve and enable activity in biologics that are designed to treat rare and serious diseases, with an initial focus on developing SEL‑212 for the treatment of chronic refractory gout.
−Removed: We are also leveraging our ImmTOR platform to pursue programs in additional therapeutic areas with a focus on gene therapy.
−Removed: We are developing two gene therapy product candidates for rare inborn errors of metabolism.
−Removed: Our lead gene therapy program, known as SEL-302, is a potential gene therapy product candidate for MMA .
−Removed: In August 2019, we entered into a feasibility study and license agreement with AskBio, the AskBio Collaboration Agreement, pursuant to which we and AskBio agreed to conduct proof of concept studies to potentially validate the use of our ImmTOR platform in conjunction with an AAV gene therapy for the treatment of MMA, based on SEL-302, to mitigate the formation of neutralizing anti-AAV capsid antibodies.
−Removed: If the proof of concept studies are successful, we will proceed with a collaboration to pursue the development and commercialization of AAV gene therapy product candidates utilizing ImmTOR for the treatment of certain agreed serious rare and orphan genetic diseases.
−Removed: Our second gene therapy product candidate, known as SEL-313, is being developed to treat ornithine transcarbamylase deficiency.
−Removed: In September 2018, we announced a collaboration with the European consortium, CureCN, for an ImmTOR+AAV gene therapy combination product candidate in Crigler-Najjar syndrome, a rare genetic disorder characterized by an inability to properly convert and clear bilirubin from the body.
−Removed: We expect the CureCN consortium to obtain scientific advice from the German drug regulatory authority in 2020.
−Removed: We are at an early stage of development of most of our product candidates and our technology has not yet led to, and may never lead to, approvable or marketable drugs.
−Removed: We may have problems identifying new product candidates and applying our
−Removed: technologies to these other areas.
+Added: We are primarily developing our ImmTOR platform to improve and enable activity in biologics that are designed to treat rare and serious diseases.
+Added: While we have completed our early development clinical trials and a Phase 2 clinical trial for SEL-212, we have not completed a clinical trial for any other product candidate, nor have we demonstrated our ability to successfully complete any Phase 3 or other pivotal clinical trials, obtain regulatory approvals, manufacture a commercial product, or arrange for a third party to do so on our behalf, or conduct other sales and marketing activities necessary for successful product commercialization.
+Added: We may have problems identifying new product candidates and applying our technologies to these other areas.
Even if we are successful in identifying new product candidates, they may not be suitable for clinical development, including as a result of harmful side effects, limited efficacy or other characteristics that indicate that they are unlikely to be products that will receive marketing approval and achieve market acceptance.
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• receipt of marketing approvals from applicable regulatory authorities;
−Removed: obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates;
+Added: • obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates and not infringing or violating patents or other intellectual property of third parties;
• making arrangements with third-party manufacturers for, or establishing, commercial manufacturing capabilities, or establishing such capabilities ourselves;
• launching commercial sales of our products, if and when approved, whether alone or in collaboration with others;
−Removed: our existing collaboration agreements remaining in effect and our ability to enter into new collaborations throughout the development process as appropriate, from preclinical studies through to commercialization;
• acceptance of our products, if and when approved, by patients and the medical community;
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• obtaining and maintaining coverage and adequate reimbursement by third-party payors, including government payors, for our products, if approved;
−Removed: protecting our rights in our intellectual property portfolio;
−Removed: operating without infringing or violating the valid and enforceable patents or other intellectual property of third parties;
• maintaining an acceptable safety profile of our products following approval;
• maintaining and growing an organization of scientists and business people who can develop and commercialize our product candidates and technology.
−Removed: If we do not successfully develop and commercialize product candidates based upon our technological approach, we will not be able to obtain future revenues, which would result in significant harm to our financial position and adversely affect our stock price.
−Removed: As a result, we cannot be certain that our approach, or our development of SEL-212, will lead to the development or approval of marketable products.
−Removed: due to the unproven nature of our ImmTOR therapeutics, there may be different efficacy and safety rates in various indications;
−Removed: the FDA or other regulatory agencies may lack experience in evaluating the efficacy and safety of products based on ImmTOR or a biologic sourced from China or other jurisdictions, which could result in a longer‑than‑expected regulatory review process, increase our expected development costs or delay or prevent commercialization of our product candidates;
−Removed: in the event of a biologics license application, or BLA, for SEL‑212 or another product and a pre‑approval inspection by the FDA of the facilities of Shenyang Sunshine Pharmaceutical Co., Ltd., or 3SBio, or any other third party manufacturers we may use, the FDA may not approve the facility for production or may make observations that will take significant time for 3SBio or such other manufacturer to address.
The occurrence of any of the foregoing would effectively prevent or delay approval of our lead and other product candidates.
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Regulatory authorities in the United States and European Union have limited experience in reviewing and approving gene therapy products, which could affect the time and data required to obtain marketing authorization of any of our product candidates.
−Removed: Our future success depends in part on our successful development of viable gene therapy product candidates utilizing ImmTOR platform.
+Added: Our future success depends in part on our successful development of viable gene therapy product candidates utilizing our ImmTOR platform.
We may experience problems or delays in developing such product candidates and any such problems or delays (i) may result in unanticipated costs and time to develop our product candidates and/or (ii) may not be resolved in a satisfactory manner.
−Removed: The process of obtaining marketing approvals, both in the United States and abroad, is expensive and may take many years.
−Removed: If additional clinical trials are required for certain jurisdictions, these trials can vary substantially based upon a variety of factors, including the type, complexity and novelty of the product candidates involved, and may ultimately be unsuccessful.
−Removed: Changes in marketing approval policies during the development period, changes in or the enactment or promulgation of additional statutes or regulations, respectively, or changes in the regulatory review process for each submitted product application, may cause delays in the review and approval of an application.
−Removed: The regulatory approval process and clinical trial requirements for novel product candidates can be more expensive and take longer than for other, better known or more extensively studied product candidates, and we cannot predict how long it will take or how much it will cost to complete clinical developments and obtain regulatory approvals for a gene therapy product candidate in either the United States or the European Union or how long it will take to commercialize a gene therapy product candidate, if and when approved.
−Removed: Regulatory requirements governing gene therapy products have changed frequently and may continue to change in the future.
−Removed: For example, the FDA established the Office of Tissues and Advanced Therapies within its Center for Biologics Evaluation and Research, or CBER, to consolidate the review of gene therapy and related products, and the Cellular, Tissue and Gene Therapies Advisory Committee to advise CBER on its review.
−Removed: These and other regulatory review agencies, committees and advisory groups and the requirements and guidelines they promulgate may lengthen the regulatory review process, require us to perform additional preclinical studies or clinical trials, increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of these treatment candidates or lead to significant post-approval limitations or restrictions.
+Added: The clinical trial requirements of the FDA and other regulatory authorities and the criteria these regulators use to evaluate the safety and efficacy of a product candidate vary substantially according to the type, complexity, novelty and intended use and market of the potential products.
+Added: The regulatory approval process for product candidates created with novel genome editing technology such as ours can be more lengthy, rigorous and expensive than the process for other better known or more extensively studied product candidates and technologies.
+Added: Since we are developing novel treatments for diseases in which there is little clinical experience with new endpoints and methodologies, there is heightened risk that the FDA, the European Medicines Agency, or the EMA, or comparable regulatory bodies may not consider the clinical trial endpoints to provide clinically meaningful results, and the resulting clinical data and results may be more difficult to analyze.
+Added: This may be a particularly significant risk for many of the genetically defined diseases for which we may develop product candidates alone or with collaborators due to small patient populations for those diseases, and designing and executing a rigorous clinical trial with appropriate statistical power is more difficult than with diseases that have larger patient populations.
+Added: Regulatory agencies administering existing or future regulations or legislation may not allow production and marketing of products utilizing genome editing technology in a timely manner or under technically or commercially feasible conditions.
+Added: Even if our product candidates obtain required regulatory approvals, such approvals may later be withdrawn as a result of changes in regulations or the interpretation of regulations by applicable regulatory agencies.
Additionally, under the National Institutes of Health, or NIH, Guidelines for Research Involving Recombinant DNA Molecules, or the NIH Guidelines, supervision of human gene transfer trials includes evaluation and assessment by an institutional biosafety committee, or IBC, a local institutional committee that reviews and oversees research utilizing recombinant or synthetic nucleic acid molecules at that institution.
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While the NIH Guidelines are not mandatory unless the research in question is being conducted at or sponsored by institutions receiving NIH funding of recombinant or synthetic nucleic acid molecule research, many companies and other institutions not otherwise subject to the NIH Guidelines voluntarily follow them.
−Removed: A similar framework is in place in the European Union, or the EU.
−Removed: The European Medicines Agency, or the EMA, has a Committee for Advanced Therapies, or CAT, that is responsible for assessing the quality, safety and efficacy of advanced-therapy medicinal products.
+Added: A similar framework is in place in the EU.
+Added: The EMA has a Committee for Advanced Therapies, or CAT, that is responsible for assessing the quality, safety and efficacy of advanced-therapy medicinal products.
Advanced-therapy medical products include gene therapy medicine, somatic-cell therapy medicines and tissue-engineered medicines.
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As a result, the procedures and standards applied to gene therapy products and cell therapy products may be applied to any of our gene therapy or genome editing product candidates, but that remains uncertain at this point.
−Removed: The clinical trial requirements of the FDA, the EMA and other regulatory authorities and the criteria these regulators use to evaluate the safety and efficacy of a product candidate vary substantially according to the type, complexity, novelty and intended use and market of the potential products.
−Removed: The regulatory approval process for product candidates created with novel genome editing technology such as ours can be more lengthy, rigorous and expensive than the process for other better known or more extensively studied product candidates and technologies.
−Removed: Since we are developing novel treatments for diseases in which there is little clinical experience with new endpoints and methodologies, there is heightened risk that the FDA, the EMA or comparable regulatory bodies may not consider the clinical trial endpoints to provide clinically meaningful results, and the resulting clinical data and results may be more difficult to analyze.
−Removed: This may be a particularly significant risk for many of the genetically defined diseases for which we may develop product candidates alone or with collaborators due to small patient populations for those diseases, and designing and executing a rigorous clinical trial with appropriate statistical power is more difficult than with diseases that have larger patient populations.
−Removed: Regulatory agencies administering existing or future regulations or legislation may not allow production and marketing of products utilizing genome editing technology in a timely manner or under technically or commercially feasible conditions.
−Removed: Even if our product candidates obtain required regulatory approvals, such approvals may later be withdrawn as a result of changes in regulations or the interpretation of regulations by applicable regulatory agencies.
Changes in applicable regulatory guidelines may lengthen the regulatory review process for our product candidates, require additional studies or trials, increase development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of such product candidates, or lead to significant post-approval limitations or restrictions.
−Removed: Additionally, adverse developments in clinical trials conducted by others of gene therapy products or products
−Removed: created using genome editing technology, or adverse public perception of the field of genome editing, may cause the FDA, the EMA and other regulatory bodies to revise the requirements for approval of any product candidates we may develop or limit the use of products utilizing genome editing technologies, either of which could materially harm our business.
+Added: Additionally, adverse developments in clinical trials conducted by others of gene therapy products or products created using genome editing technology, or adverse public perception of the field of genome editing, may cause the FDA, the EMA and other regulatory bodies to revise the requirements for approval of any product candidates we may develop or limit the use of products utilizing genome editing technologies, either of which could materially harm our business.
Furthermore, regulatory action or private litigation could result in expenses, delays or other impediments to our research programs or the development or commercialization of current or future product candidates.
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In addition, varying interpretations of the data obtained from preclinical and clinical testing could delay, limit or prevent marketing approval of a product candidate.
+Added: Additionally, adverse developments in clinical trials conducted by others of gene therapy products or products created using genome editing technology, or adverse public perception of the field of genome editing, may cause the FDA and other regulatory bodies to revise the requirements for approval of any product candidates we may develop or limit the use of products utilizing genome editing technologies, either of which could materially harm our business.
Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market would materially and adversely affect our business, financial condition, results of operations and prospects.
1 unchanged sentence
We may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidates.
−Removed: Our lead product candidate, SEL-212, was evaluated in a Phase 2 clinical program that was initiated in October 2016 and the final patient's last visit occurred in January 2019.
−Removed: In March 2019, we initiated COMPARE, a Phase 2 clinical trial designed to directly compare the safety, efficacy and tolerability of SEL-212 to the currently FDA-approved uricase therapy, KRYSTEXXA, for the treatment of patients with chronic refractory gout, and completed our targeted enrollment of the COMPARE trial in December 2019.
−Removed: We are preparing for the start of a pivotal Phase 3 program for SEL-212.
−Removed: In May 2017 we licensed LMB-100, a potent immunotoxin, from the National Cancer Institute (NCI) and a Phase 1 clinical trial of LMB-100 plus ImmTOR (SEL-403) initiated in March 2018 by NCI in patients with malignant pleural or peritoneal mesothelioma who had undergone at least one regimen of chemotherapy under a Cooperative Research and Development Agreement (CRADA) between the NCI and the Company.
−Removed: In October 2018, the NCI informed the Company of a Grade 5 Serious Adverse Event (patient death) in this clinical trial related to pneumonitis, which was deemed by the trial investigator to be probably related to SVP-Rapamycin and possibly related to the patient’s pleural mesothelioma condition.
−Removed: This patient had received previous therapies, including two courses of radiation therapy and three different immune check point inhibitors, which have been reported to be associated with pneumonitis.
−Removed: However, the possible relationship to SVP-Rapamycin could not be excluded.
−Removed: Pneumonitis has been reported in patients receiving daily oral rapamycin.
−Removed: In addition, a Serious Adverse Event (pericardial effusion) was seen in one of the other three patients dosed in the SEL-403 clinical trial.
−Removed: Pericardial effusion can also be a side effect of immunotoxin therapies targeting mesothelin.
−Removed: The FDA placed the IND for SEL-403 on full clinical hold in response to adverse events observed during the Phase 1 trial.
−Removed: Selecta has terminated the license of LMB-100 from NCI, effective April 9, 2019 and is no longer pursuing this product candidate.
−Removed: Aside from these programs, our other product candidates are in preclinical development.
+Added: Aside from SEL-212, our product candidates are in preclinical development.
It is impossible to predict when or if any of our product candidates will prove effective and safe in humans or will receive regulatory approval, and the risk of failure through the development process is high.
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Preclinical development is costly and inherently uncertain.
−Removed: For example, we have invested significant resources in our preclinical gene therapy program, which has demonstrated the potential for treatment of rare inborn errors of metabolism.
Early preclinical results may not be predictive of future results, however, if our technology proves to be ineffective or unsafe as a result of, among other things, adverse side effects, pre-existing anti-drug antibodies that can neutralize the viral vector and block gene transfer, or cellular immune response to the transduced cells, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the clinical development and commercialization of our product candidates.
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Moreover, the outcome of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results.
−Removed: For example, the clinical trial results from our Phase 2 head-to-head (COMPARE) study of SEL-212, including
−Removed: interim results, may not be predictive of future results.
+Added: For example, the topline clinical trial results we reported from our Phase 2 head-to-head COMPARE study of SEL-212 may not be predictive of future results.
Moreover, we may not be able to complete, or may be required to deviate from the current clinical trial protocol for a variety of reasons.
Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in clinical trials after achieving positive results in preclinical development or early-stage clinical trials, and we cannot be certain that we will not face similar setbacks.
−Removed: These setbacks have been caused by, among other things, preclinical findings made while clinical trials were underway or safety or efficacy observations made in clinical trials, including adverse events.
SAEs caused by, or other unexpected properties of, any product candidates that we may choose to develop could cause us, an institutional review board or regulatory authority to interrupt, delay or halt clinical trials of one or more of such product candidates and could result in a more restrictive label or the delay or denial of marketing approval by the FDA or comparable non-U.S.
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If any product candidate that we may choose to develop is associated with SAEs or other unexpected properties, we may need to abandon development or limit development of that product candidate to certain uses or subpopulations in which those undesirable characteristics would be expected to be less prevalent, less severe or more tolerable from a risk-benefit perspective.
−Removed: For example, in the SEL-403 Phase 1 clinical trial, a Grade 5 SAE (patient death) occurred that was deemed by the trial investigator to be probably related to SVP-Rapamycin and possibly related to the patient's pleural mesothelioma condition which led the Company to abandon development of SEL-403.
−Removed: In the SEL-212 Phase 1/2 clinical program, multiple SAEs have occurred, and future SAEs may occur causing the Company to incur additional costs or experience delays in completing, or causing the Company to ultimately be unable to complete, the development and commercialization of our product candidates, and delay or prevent our ability to obtain FDA approval.
+Added: For example, in the SEL-403 Phase 1 clinical trial, a Grade 5 SAE (patient death) occurred that was deemed by the trial investigator to be probably related to SVP-Rapamycin and possibly related to the patient's pleural mesothelioma condition which led us to abandon development of SEL-403.
+Added: In the SEL-212 Phase 1/2 clinical program, multiple SAEs have occurred, and future SAEs may occur causing us to incur additional costs or experience delays in
+Added: completing, or causing us to ultimately be unable to complete, the development and commercialization of our product candidates, and delay or prevent our ability to obtain FDA approval.
Moreover, preclinical and clinical data is often susceptible to varying interpretations and analyses, and many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials nonetheless failed to obtain FDA or other regulatory authority approval.
If we fail to produce positive results in clinical trials of our product candidates, the development timeline and regulatory approval and commercialization prospects for our product candidates, and, correspondingly, our business and financial prospects, would be negatively impacted.
−Removed: In addition, we cannot be certain as to what type and how many clinical trials the FDA will require us to conduct before we may gain regulatory approval to market SEL-212 or any of our other product candidates in the United States or other countries, if any.
+Added: In addition, we cannot be certain as to what type and how many clinical trials the FDA will require us to conduct before we may gain regulatory approval to market any of our product candidates in the United States or other countries, if any.
Prior to approving a new therapeutic product, the FDA generally requires that safety and efficacy be demonstrated in two adequate and well-controlled clinical trials.
−Removed: We expect that we may need to conduct more than one Phase 3 trial for SEL-212 for a chronic refractory gout indication in order to gain approval from the FDA.
−Removed: Even if we conduct more than one Phase 3 trial for SEL-212, the FDA may not accept the data, and may delay, limit or deny approval of SEL-212.
−Removed: Additional clinical trials could cause us to incur significant development costs, delay or prevent the commercialization of SEL-212 or otherwise adversely affect our business.
+Added: We expect that we and Sobi will need to conduct more than one Phase 3 trial for SEL-212 for a chronic refractory gout indication in order to gain approval from the FDA.
+Added: Even if we and Sobi conduct more than one Phase 3 trial for SEL-212, the FDA may not accept the data, and may delay, limit or deny approval of SEL-212, which could have an impact on the timing of development milestone payments owed to us by Sobi.
We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval for, or commercialize, our product candidates, including:
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• lose the support of collaborators, requiring us to bear more of the burden of research and development;
−Removed: not obtain marketing approval at all;
• obtain marketing approval in some countries and not in others;
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• have a product removed from the market after obtaining marketing approval.
+Added: In addition, disruptions caused by the COVID-19 pandemic may increase the likelihood that we encounter such difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing clinical trials.
We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs of the institutions in which such trials are being conducted, by a data safety monitoring board for such trial or by the FDA or comparable foreign regulatory authorities.
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In addition, from time to time our competitors have ongoing clinical trials for product candidates that treat the same indications as our product candidates, and patients who would otherwise be eligible for our clinical trials may instead enroll in clinical trials of our competitors’ product candidates.
−Removed: We are initially developing our lead product candidate, SEL‑212, for the treatment of chronic refractory gout, which affects approximately 160,000 patients in the United States.
−Removed: Accordingly, there is a limited number of patients who could enroll in our clinical studies.
−Removed: In addition to the size of the patient population, patient enrollment is also affected by other factors including:
−Removed: the severity of the disease under investigation;
−Removed: the patient eligibility criteria for the study in question;
−Removed: the perceived risks and benefits of the product candidate under study;
−Removed: the availability of other treatments for the disease under investigation;
−Removed: the existence of competing clinical trials;
−Removed: our efforts to facilitate timely enrollment in clinical trials;
−Removed: investigators engagement with, or enthusiasm about, the trial;
−Removed: our payments for participating in clinical trials;
−Removed: the patient referral practices of physicians;
−Removed: the design of the trial;
−Removed: the ability to monitor patients adequately during and after treatment;
−Removed: the proximity and availability of clinical trial sites for prospective patients.
−Removed: In addition, our clinical trials will compete with other clinical trials for product candidates that are in the same therapeutic areas as our product candidates, and this competition will reduce the number and types of patients available to us, because some patients who might have opted to enroll in our trials may instead opt to enroll in a trial being conducted by one of our competitors.
−Removed: Since the number of qualified clinical investigators is limited, we expect to conduct some of our clinical trials at the same clinical trial sites that some of our competitors use, which will reduce the number of patients who are available for our clinical trials at such clinical trial site.
+Added: For example, SEL-212 is being developed for the treatment of chronic refractory gout, which affects a small patient population in the United States.
+Added: Accordingly, there is a limited number of patients who could enroll in our clinical studies for SEL-212.
+Added: Additionally, the COVID-19 pandemic could affect our ability to enroll or sustain patients in our clinical trials.
Our inability to enroll a sufficient number of patients for our clinical trials would result in significant delays and could require us to abandon one or more clinical trials altogether.
Enrollment delays in our clinical trials may result in increased development costs for our product candidates, which could cause the value of our common stock to decline and limit our ability to obtain additional financing.
+Added: The outbreak of COVID-19 may continue to adversely impact our business, including our preclinical studies and clinical trials.
+Added: The ongoing COVID-19 pandemic has impacted our business and we expect it to continue to do so.
+Added: In response to the spread of COVID-19, we closed our principal executive office with our administrative employees continuing their work outside of our office and limited the number of staff in any given research and development laboratory.
+Added: As COVID-19 continues to spread in the United States and elsewhere, we may experience disruptions that could severely impact our business, preclinical studies and clinical trials, including:
+Added: • delays in receiving approval from local regulatory authorities to initiate our planned clinical trials;
+Added: • delays or difficulties in enrolling or sustaining patients in our clinical trials;
+Added: • delays or difficulties in clinical site initiation, including difficulties in recruiting clinical site investigators and clinical site staff;
+Added: • delays in clinical sites receiving the supplies and materials needed to conduct our clinical trials, such as ImmTOR including interruption in global shipping that may affect the transport of clinical trial materials;
+Added: • changes in local regulations as part of a response to the COVID-19 coronavirus pandemic which may require us to change the ways in which our clinical trials are conducted, which may result in unexpected costs, or to discontinue the clinical trials altogether;
+Added: • diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals and clinics serving as our clinical trial sites and hospital and clinic staff supporting the conduct of our clinical trials;
+Added: • interruption of key clinical trial activities, such as clinical trial site monitoring, due to limitations on travel imposed or recommended by federal or state governments, employers and others, or interruption of clinical trial subject visits and study procedures, or the closing of clinical trial sites due to the virus, the occurrence of which could affect the integrity of clinical trial data;
+Added: • risk that participants enrolled in our clinical trials will acquire COVID-19 while the clinical trial is ongoing, or will withdraw from the clinical trial due to concerns over COVID-19, which could impact the results of the clinical trial, including by increasing the number of observed adverse events, or reducing the statistical power of the clinical trials;
+Added: • interruptions or delays in preclinical studies due to restricted or limited operations at our research and development laboratory facility;
+Added: • delays in necessary interactions with local regulators, ethics committees and other important agencies and contractors due to limitations in employee resources or forced furlough of government employees;
+Added: • limitations in employee resources that would otherwise be focused on the conduct of our clinical trials, including because of sickness of employees or their families or the desire of employees to avoid contact with large groups of people;
+Added: • refusal of the FDA to accept data from clinical trials in affected geographies;
+Added: • changes to the clinical endpoints, statistical analysis plan, or enrollment plans for ongoing clinical trials due to limitations in patients, resources, or sites due to COVID-19;
+Added: • interruption or delays to our sourced discovery and clinical activities;
+Added: • impacts from prolonged remote work arrangements, such as increased cybersecurity risks and strains on our business continuity plans.
+Added: The extent to which the COVID-19 pandemic impacts our business, preclinical studies and clinical trials will depend on future developments, which are highly uncertain and cannot be predicted with confidence.
We may conduct clinical trials for product candidates at sites outside the United States, and the FDA may not accept data from trials conducted in such locations or the complexity of regulatory burdens may otherwise adversely impact us.
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If the FDA does not accept the data from any trial that we conduct outside the United States, it would likely result in the need for additional clinical trials, which would be costly and time-consuming and delay or permanently halt our development of any applicable product candidates.
−Removed: In addition, the conduct of clinical trials outside the United States could have a significant impact on us.
−Removed: Risks inherent in conducting international clinical trials include:
+Added: Additional risks inherent in conducting international clinical trials include:
• foreign regulatory requirements that could burden or limit our ability to conduct our clinical trials;
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• changes in country or regional regulatory requirements.
−Removed: We may not be able to obtain orphan drug designation for our product candidates, and even if we do, we may be unable to maintain the benefits associated with orphan drug designation, including the potential for market exclusivity.
−Removed: Regulatory authorities in some jurisdictions, including the United States and Europe, may designate drugs for relatively small patient populations as orphan drugs.
−Removed: We expect to seek orphan drug designation for several of our product candidates.
−Removed: Under the Orphan Drug Act of 1983, the FDA may designate a product as an orphan product if it is intended to treat a rare disease or condition, which is generally defined as a patient population of fewer than 200,000 individuals in the United States, or a patient population of greater than 200,000 individuals in the United States, but for which there is no reasonable expectation that the cost of developing the drug or biologic will be recovered from sales in the United States.
−Removed: In the United States, orphan designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user‑fee waivers.
−Removed: In addition, if a product candidate that has orphan designation subsequently receives the first FDA approval for the disease for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including a full BLA or full new drug application, or NDA, to market the same biologic or drug for the same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity or where the manufacturer is unable to assure sufficient product quantity.
−Removed: The applicable exclusivity period is ten years in the European Union, but such exclusivity period can be reduced to six years if a product no longer meets the criteria for orphan designation or if the product is sufficiently profitable so that market exclusivity is no longer justified.
−Removed: Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition.
−Removed: Even after an orphan drug is approved, the FDA can subsequently approve the same drug for the same condition if the FDA concludes that the later drug is clinically superior if it is shown to be safer, more effective or makes a major contribution to patient care.
−Removed: Orphan drug designation neither shortens the development time or regulatory review time of a drug or biologic nor gives the drug or biologic any advantage in the regulatory review or approval process.
+Added: We may not be able to qualify for or obtain various designations from regulators that would have the potential to expedite the review process of one or more of our product candidates and even if we do receive one or more such designations there is no guarantee that they will ultimately expedite the process, or aid in our obtaining marketing approval or provide market exclusivity.
+Added: There exist several designations that we can apply for from the FDA and other regulators that would provide us with various combinations of the potential for expedited regulatory review, certain financial incentives as well as the potential for post-approval exclusivity for a period of time.
+Added: These designations include but are not limited to orphan drug designation, breakthrough therapy designation, accelerated approval, fast track status and priority review for our product candidates.
+Added: For example, we and AskBio received orphan drug designation for MMA-101 in November 2020.
+Added: We expect to seek one or more of these designations for our current and future product candidates.
+Added: There can be no assurance that any of our other product candidates will qualify for any of these designations.
+Added: There can also be no assurance that any of our product candidates that do qualify for these designations will be granted such designations or that the FDA will not revoke a designation it grants at a later date.
+Added: Further, there can be no assurance that any of our product candidates that are granted such designations will ever benefit from such designations or that the FDA would not withdraw such designations once granted.
+Added: Were we to receive a designation that promised a period of market exclusivity, such as orphan drug exclusivity, such exclusivity may not effectively protect the product from competition because different drugs can be approved for the same condition.
+Added: Further with respect to orphan drug status, even after an orphan drug is approved, the FDA can subsequently approve the same drug for the same condition if the FDA concludes that the later drug is clinically superior if it is shown to be safer, more effective or makes a major contribution to patient care.
Interim, top-line and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.
From time to time, we may publish interim, top-line or preliminary data from our clinical studies, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a full analyses of all data related to the particular trial.
+Added: For example, we and Sobi announced top-line data from the Phase 2 COMPARE trial for SEL-212 in September 2020.
We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data.
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If the interim, top-line, or preliminary data that we report differ from final results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for, and commercialize, product candidates may be harmed, which could seriously harm our business.
−Removed: The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidates, our business will be substantially harmed.
−Removed: The time required to obtain approval by the FDA and comparable foreign authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of
−Removed: the regulatory authorities.
−Removed: In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate’s clinical development and may vary among jurisdictions.
−Removed: We have not obtained regulatory approval for any product candidate and it is possible that SEL-212 or any other product candidates we may seek to develop in the future will ever obtain regulatory approval.
−Removed: Neither we nor any future collaborator is permitted to market any of our product candidates in the United States until we receive regulatory approval of a Biologics License Application, or BLA, from the FDA.
−Removed: Prior to obtaining approval to commercialize a product candidate in the United States or abroad, we or our collaborators must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA or foreign regulatory agencies, that such product candidates are safe and effective, or in the case of biologics, safe, pure, and potent, for their intended uses.
−Removed: Results from nonclinical studies and clinical trials can be interpreted in different ways.
−Removed: Even if we believe the nonclinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities.
−Removed: The FDA may also require us to conduct additional preclinical studies or clinical trials for our product candidates either prior to or post-approval, or it may object to elements of our clinical development program.
−Removed: The FDA or any foreign regulatory bodies can delay, limit or deny approval of our drug or device product candidates or require us to conduct additional nonclinical or clinical testing or abandon a program for, including the following:
−Removed: the FDA or comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials;
−Removed: we may be unable to demonstrate to the satisfaction of the FDA or comparable foreign regulatory authorities that a product candidate is safe and effective for its proposed indication;
−Removed: the results of clinical trials may not meet the level of statistical significance required by the FDA or comparable foreign regulatory authorities for approval;
−Removed: serious and unexpected drug-related side effects experienced by participants in our clinical trials or by individuals using drugs similar to our product candidates;
−Removed: we may be unable to demonstrate that a product candidate’s clinical and other benefits outweigh its safety risks;
−Removed: the FDA or comparable foreign regulatory authorities may disagree with our interpretation of data from preclinical studies or clinical trials;
−Removed: the data collected from clinical trials of our product candidates may not be acceptable or sufficient to support the submission of a BLA or other submission or to obtain regulatory approval in the United States or elsewhere, and we may be required to conduct additional clinical studies;
−Removed: the FDA’s or the applicable foreign regulatory agency may disagree regarding the formulation, labeling and/or the specifications of our product candidates;
−Removed: the FDA or comparable foreign regulatory authorities may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies;
−Removed: the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval.
−Removed: Of the large number of drugs in development, only a small percentage successfully complete the FDA or foreign regulatory approval processes and are commercialized.
−Removed: The lengthy approval process as well as the unpredictability of future clinical trial results may result in our failing to obtain regulatory approval to market our product candidates, which would significantly harm our business, results of operations and prospects.
−Removed: In addition, even if we were to obtain approval, regulatory authorities may approve any of our product candidates for fewer or more limited indications than we request, may not approve the price we intend to charge for our products, may grant approval contingent on the performance of costly post-marketing clinical trials, including Phase 4 clinical trials, and/or the implementation of a Risk Evaluation and Mitigation Strategy, or REMS, which may be required to assure safe use of the drug after approval.
−Removed: The FDA or the applicable foreign regulatory agency also may approve a product candidate for a more limited indication or patient population than we originally requested, or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate.
−Removed: Any of the foregoing scenarios could materially harm the commercial prospects for our product candidates.
−Removed: Any breakthrough therapy designation that we may receive from the FDA for our product candidates may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that our product candidates will receive marketing approval.
−Removed: We may in the future seek breakthrough therapy designation for some of our product candidates.
−Removed: A breakthrough therapy is defined as a drug that is intended, alone or in combination with one or more other drugs, to treat a serious or life‑threatening disease or condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints.
−Removed: For drugs that have been designated as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens.
−Removed: Drugs designated as breakthrough therapies by the FDA are also eligible for accelerated approval.
−Removed: Designation as a breakthrough therapy is within the discretion of the FDA.
−Removed: Accordingly, even if we believe one of our product candidates meets the criteria for designation as a breakthrough therapy, the FDA may disagree and instead determine not to make such designation.
−Removed: The availability of breakthrough therapy designation was established with the passage of the Food and Drug Administration Safety and Innovation Act of 2012.
−Removed: We cannot be sure that any evaluation we may make of our product candidates as qualifying for breakthrough therapy designation will meet the FDA’s expectations.
−Removed: In any event, the receipt of a breakthrough therapy designation for a product candidate may not result in a faster development process, review or approval compared to drugs considered for approval under conventional FDA procedures and does not assure ultimate approval by the FDA.
−Removed: In addition, even if one or more of our product candidates qualify as breakthrough therapies, the FDA may later decide that such product candidates no longer meet the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.
Negative public opinion and increased regulatory scrutiny of gene therapy and genetic research may damage public perception of our product candidates or compromise our ability to conduct our business or obtain regulatory approvals for our product candidates.
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Public perception may be influenced by claims that gene therapy is unsafe, and gene therapy may not gain the acceptance of the public or the medical community.
−Removed: In particular, our success will depend upon physicians specializing in the treatment of those diseases that our product candidates target and prescribing treatments that involve the use of our product candidates in lieu of, or in addition to, existing treatments they are already familiar with and for which greater clinical data may be available.
+Added: In particular, our success will depend upon physicians specializing in the treatment of those diseases that our product candidates target and prescribing treatments that involve the use of our product candidates in lieu of, or in addition to, existing treatments they are already familiar with and for
+Added: which greater clinical data may be available.
More restrictive government regulations or negative public opinion would have a negative effect on our business or financial condition and may delay or impair the development and commercialization of our product candidates or demand for any products we may develop.
−Removed: Our product candidates, including our products that utilize viral delivery systems, could produce adverse events.
−Removed: Adverse events in our clinical trials or following approval of any of our product candidates, even if not ultimately attributable to our product candidates, could result in increased governmental regulation, unfavorable public perception, potential regulatory delays in the testing or approval of our product candidates, stricter labeling requirements for those product candidates that are approved and a decrease in demand for any such product candidates.
Our product candidates may cause undesirable side effects or have other properties that could delay or prevent their regulatory approval, limit the commercial profile of an approved label, or result in significant negative consequences following marketing approval, if any.
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For example, a patient in the Phase 1 trial of SEL-403 experienced a Grade 5 SAE (patient death) related to pneumonitis, which was deemed by the trial investigator to be probably related to ImmTOR and possibly related to the patient’s pleural mesothelioma condition, and in November 2018, the FDA placed the IND for SEL-403 on full clinical hold due to adverse events observed in the Phase 1 trial.
−Removed: Selecta has terminated the license of LMB-100 from NCI, effective April 9, 2019 and is no longer pursuing this product candidate.
−Removed: Further, the SEL-212 multi-year clinical development program requiring multiple clinical trials resulted in the use of different formulations of ImmTOR.
−Removed: While we do not believe that differences in formulation will affect the safety or the efficacy of SEL-212, we cannot guarantee that any such formulation changes will not negatively impact the results of any clinical trials related to SEL-212, or result in a significant difference in the safety and efficacy of SEL-212.
−Removed: The drug‑related side effects could also affect patient enrollment in our clinical trials or the ability of any enrolled patients to complete such trials or result in potential product liability claims.
+Added: We terminated the license of LMB-100, a component of SEL-403, from NCI in April 9, 2019 and are no longer pursuing this product candidate.
+Added: Further, the clinical development of SEL-212 over many years has required multiple clinical trials and resulted in the use of different formulations of ImmTOR.
+Added: While we do not believe that such differences in formulation will affect the safety or the efficacy of SEL-212, we cannot guarantee that any such formulation changes will not negatively impact the results of any clinical trials related to SEL-212, or result in a significant difference in the safety and efficacy of SEL-212.
+Added: The drug-related side effects observed in our clinical trials could also affect patient enrollment in our clinical trials or the ability of any enrolled patients to complete such trials or result in potential product liability claims.
Any of these occurrences may harm our business, financial condition and prospects significantly.
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We obtain the biologic pegadricase, a component of SEL-212, primarily from 3SBio in China.
−Removed: Under our license agreement with 3SBio, we have limited rights to manufacture pegadricase and, while we have entered into a contract with a back-up supplier located outside of China, we expect to continue to rely on 3SBio as the primary supplier of pegadricase for the foreseeable future.
−Removed: Any disruption in production or inability of 3SBio in China to produce adequate quantities of pegadricase to meet our needs, whether as a result of a natural disaster, public health emergency, such as the novel coronavirus, failure to comply with regulatory requirements or other causes, could impair our ability to operate our business on a day‑to‑day basis and to continue our research and development of our future product candidates.
+Added: Under the 3SBio License, we have limited rights to manufacture pegadricase and while we have entered into a contract with a back-up supplier located outside of China, we expect to continue to rely on 3SBio as the primary supplier of pegadricase for the foreseeable future.
+Added: Any disruption in production or inability of 3SBio in China to produce adequate quantities of pegadricase to meet our needs could impair our ability to operate our business on a day-to-day basis and to continue our research and development of our future product candidates.
Furthermore, since 3SBio is located in China, we are exposed to the possibility of product supply disruption and increased costs in the event of changes in the policies, laws, rules and regulations of the United States or Chinese governments, political unrest or unstable economic conditions in China.
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Pegadricase is subject to, and any other components we purchase from China may be subject to these tariffs, which could increase our manufacturing costs and could make our products, if successfully developed and approved, less competitive than those of our competitors whose inputs are not subject to these tariffs.
+Added: Moreover, as a result of the COVID-19 pandemic, certain of our suppliers and CMOs in the United States, China and other countries may be affected, which could disrupt their activities.
+Added: We could face difficulty sourcing key components necessary to produce supply of SEL-212, which may negatively affect our clinical development activities and our agreement with Sobi.
+Added: If COVID-19 continues to impact U.S.
+Added: business operations, including those of our CMOs and suppliers, we could face additional disruptions to our supply chain that could affect the supply of drug product for our preclinical studies and clinical trials.
+Added: Additionally, as our CMOs are producers of drug substances and drug products, including vaccines and therapeutics, they could be compelled by a national government, or choose themselves, to shift their resources to the production of a COVID-19 vaccine and/or therapeutics for COVID-19, which could disrupt any scheduled drug substance or drug product batches we may have and may prevent us from obtaining supplies for our programs in a timely manner to meet our development timelines.
Any of these matters could materially and adversely affect our business and results of operations.
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Future appreciation of the local currency could increase our costs.
−Removed: In addition, labor costs could continue to rise as wage rates increase due to increased demand for skilled laborers and the availability of skilled labor declines in China.
−Removed: In addition to 3SBio, we rely, and expect to continue to rely, on other third parties for the manufacture of our product candidates for preclinical and clinical testing, as well as for commercial manufacture if any of our product candidates receive marketing approval.
+Added: These factors and increasing wage rates due to increased demand for skilled laborers and the declining availability of skilled labor in China could cause our labor costs to rise.
+Added: We rely, and expect to continue to rely, in addition to 3SBio, on other third parties for the manufacture of our product candidates for supply in preclinical studies and clinical trials, as well as for commercial manufacture if any of our product candidates receive marketing approval.
Our reliance on such third parties increases the risk that we will not have sufficient quantities of our product candidates on a timely basis or at all, or that such quantities will be available at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts.
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As a result, we may be unable to successfully manufacture our gene therapy preclinical materials through a third party or scale up the manufacture of our gene therapy product candidates for clinical testing or commercialization, if at all.
−Removed: We may be unable to establish any agreements with third‑party manufacturers on acceptable terms or at all.
−Removed: Even if we are able to establish agreements with third‑party manufacturers, reliance on third‑party manufacturers entails additional risks, including the:
+Added: We may be unable to establish any agreements with third-party manufacturers on acceptable terms or at all, and even if we do rely on third-party manufacturers entails additional risks, including the:
• inability, failure or unwillingness of third-party manufacturers to comply with regulatory requirements, maintain quality assurance, meet our needs, specifications or schedules or continue to supply products to us;
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Our current and expected future dependence upon others for the manufacture of our product candidates or products could delay, prevent or impair our development and commercialization efforts.
−Removed: The novel coronavirus outbreak could adversely impact our business, financial condition and results of operations.
−Removed: In December 2019, a strain of novel coronavirus surfaced in Wuhan, China.
−Removed: In January 2020, the World Health Organization declared the novel coronavirus outbreak a “Public Health Emergency of International Concern” and the U.S.
−Removed: Department of State instructed travelers to avoid all nonessential travel to China.
−Removed: The coronavirus has impacted the global economy and may
−Removed: impact our operations, including the potential interruption of our clinical trial activities and our supply chain.
−Removed: As a result of the outbreak, certain of our suppliers and CMOs in China may be affected, which could disrupt their activities.
−Removed: We could therefore face difficulty sourcing key components necessary to produce supply of SEL-212, which may negatively affect our clinical development activities.
−Removed: While we have a back-up supplier for SEL-037 in the United States, they may not have capacity in a timely manner for our projects and they may cost more, which could affect our results of operations and financial position.
−Removed: If the coronavirus further impacts US business operations, including our CMOs and suppliers, we could face additional disruption to our supply chain that could affect the supply of drug product for the clinical trials.
−Removed: In addition, the coronavirus outbreak could delay enrollment in our clinical trials due to prioritization of hospital resources toward the outbreak, and some patients may not be able to comply with clinical trial protocols if quarantines impede patient movement or interrupt healthcare services.
−Removed: At this point in time, there is significant uncertainty relating to the potential effect of the novel coronavirus on our business.
−Removed: Infections may become more widespread, including in countries where we are conducting clinical trials, and manufacturing closures and travel restrictions may remain or worsen, all of which would have a negative impact on our business, financial condition and results of operations.
−Removed: Our existing collaborations are important to our business, and future licenses may also be important to us.
−Removed: If we are unable to maintain any of these collaborations, or if these arrangements are not successful, or we are unable to enter into future licenses, our business could be adversely affected.
+Added: If we are unable to maintain any of our existing collaborations, or if these arrangements are not successful, or we are unable to enter into future licenses, our business could be adversely affected.
We have entered into collaborations with other parties, including pharmaceutical companies and universities, to develop products based on our ImmTOR platform, and such collaborations and licensing arrangements currently represent a significant portion of our product pipeline and are expected to represent a larger portion of our pipeline in the future.
−Removed: Certain of our collaborations have provided us with important funding for some of our development programs and we expect to receive additional funding under collaborations in the future although not all of our collaborations may result in funding to the Company, and certain collaborations, licenses and agreements may result in increased expenditures by the Company.
−Removed: Our existing collaborations, and any future collaborations we enter into, may pose a number of risks, including the following:
+Added: Certain of our collaborations have provided us with important funding for some of our development programs and we expect to receive additional funding under collaborations in the future although not all of our collaborations may result in funding to us, and certain collaborations, licenses and agreements may result in increased expenditures by us.
+Added: Our existing collaborations, and any future collaborations, may pose a number of risks, including the following:
• collaborators have significant discretion in determining the efforts and resources that they will apply to these collaborations;
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• collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;
−Removed: collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidates if the collaborators believe that competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours, which may cause collaborators to cease to devote resources to the commercialization of our product candidates;
+Added: • collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidates, which may cause collaborators to cease to devote resources to the commercialization of our product candidates;
• a collaborator with marketing and distribution rights to one or more of our product candidates that achieve regulatory approval may not commit sufficient resources to the marketing and distribution of such product or products;
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• collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability;
−Removed: collaborations may be terminated for the convenience of the collaborator or for our failure to comply with our obligations under existing or future collaborations and, if terminated, we would potentially lose the right to pursue further development or commercialization of the applicable product candidates;
+Added: • collaborations may be terminated and we would potentially lose the right to pursue further development or commercialization of the applicable product candidates as well as have difficulty entering into a similar collaboration where the potential collaborator is aware of the prior termination;
• collaborators may learn about our technology and use this knowledge to compete with us in the future;
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• the number and type of our collaborations could adversely affect our attractiveness to future collaborators or acquirers.
−Removed: If our collaborations do not result in the successful development and commercialization of products or if one of our collaborators terminates its agreement with us, we may not receive any future research and development funding or milestone or royalty payments under such collaborations.
−Removed: If we do not receive the funding we expect under these agreements, our continued development of our ImmTOR platform and product candidates could be delayed and we may need additional resources to develop additional product candidates.
−Removed: All of the risks relating to product development, regulatory approval and commercialization described in this Annual Report on Form 10-K also apply to the activities of our therapeutic program collaborators and there can be no assurance that our collaborations will produce positive results or successful products on a timely basis or at all.
−Removed: Additionally, subject to its contractual obligations to us, if one of our collaborators is involved in a business combination or otherwise changes its business priorities, the collaborator might deemphasize or terminate the development or commercialization of any product candidate licensed to it by us.
−Removed: If one of our collaborators terminates its agreement with us, we may find it more difficult to attract new collaborators and the perception of our business in the business and financial communities, and our stock price, could be adversely affected.
−Removed: In addition, we have a limited number of collaborations and if our relationship with any one or more of such collaborators were to cease, our business would be harmed as a result.
−Removed: For example, MIT may terminate the MIT License if we fail to meet a diligence obligation, including the initiation of a Phase 3 clinical trial by a specified date in the fourth quarter of 2019.
−Removed: In December 2019, we entered into the MIT Amendment.
−Removed: Pursuant to the MIT Amendment, the provision of the MIT License under which we were obligated to initiate a Phase 3 clinical trial for a licensed product by a specified date in the fourth quarter of 2019 is tolled until the earlier of (i) a specified date in the second quarter of 2020 or (ii) the effective date of a written amendment to the MIT Agreement.
−Removed: The parties agreed to negotiate in good faith to enter into a future amendment to the MIT License after we provide MIT with an amended diligence plan.
−Removed: However, if we are unable to reach an agreement with MIT regarding an acceptable amendment of the MIT License and if we are unable to cure the breach, there could be a material adverse effect on our business.
−Removed: See “Business - Licenses and Collaborations - Massachusetts Institute of Technology.”
We are actively exploring licenses and other strategic collaborations with additional pharmaceutical and biotechnology companies for development and potential commercialization of therapeutic products.
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We rely, and expect to continue to rely, on third parties to conduct our clinical trials, and those third parties may not perform satisfactorily, including by failing to meet deadlines for the completion of such trials.
−Removed: We expect to continue to rely on third parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators, to conduct and manage our clinical trials, including our Phase 2 and Phase 3 clinical trials of SEL‑212 and for our other product candidates.
+Added: We rely, and expect to continue to rely, on third parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators, to conduct and manage our clinical trials, including our ongoing Phase 3 DISSOLVE clinical program for SEL-212, consisting of the DISSOLVE I and DISSOLVE II trials, which we have agreed to continue to run on behalf of Sobi, and for our other product candidates.
We also expect to rely on other third parties to store and distribute drug supplies for our clinical trials.
Our reliance on these third parties for research and development activities will reduce our control over these activities but does not relieve us of our responsibilities.
−Removed: For example, we remain responsible for ensuring that each of our clinical trials is conducted in accordance with the general investigational plan and protocols for the trial.
+Added: We remain responsible for ensuring that each of our clinical trials is conducted in accordance with the general investigational plan and protocols for the trial.
Moreover, the FDA requires us to comply with GCP regulations, for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, safety and welfare of trial participants are protected.
Other countries’ regulatory agencies also have requirements for clinical trials.
−Removed: Regulatory authorities enforce these GCPs through periodic inspections of trial sponsors, principal investigators and trial sites.
If we or any of our CROs or third-party contractors fail to comply with applicable GCPs, the data generated in our clinical trials may be deemed unreliable and the FDA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving our marketing applications.
We cannot assure you that upon inspection by a given regulatory authority, such regulatory authority will determine that any of our clinical trials complies with GCP regulations.
−Removed: In addition, our clinical trials must be conducted with
−Removed: product produced under cGMP regulations.
+Added: In addition, our clinical trials must be conducted with product produced under cGMP regulations.
Our failure to comply with these regulations may require us to repeat clinical trials, which would delay the regulatory approval process.
−Removed: We also are required to register ongoing clinical trials and post the results of completed clinical trials on a government‑sponsored database, ClinicalTrials.gov , within specified timeframes.
+Added: We also are required to register ongoing clinical trials and post the results of completed clinical trials on a government-sponsored database, www.ClinicalTrials.gov , within specified timeframes.
Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.
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If any of the foregoing occur, we may not be able to obtain, or may be delayed in obtaining, marketing approvals for our product candidates or in commercializing our product candidates.
−Removed: We have no experience manufacturing our product candidates at commercial scale, and if we decide to establish our own manufacturing facility, we cannot assure you that we can manufacture our product candidates in compliance with regulations at a cost or in quantities necessary to make them commercially viable.
+Added: We have no experience manufacturing our product candidates at commercial scale, and if we decide to establish our own commercial manufacturing facility, we cannot assure you that we can manufacture our product candidates in compliance with regulations at a cost or in quantities necessary to make them commercially viable.
We have a pilot manufacturing facility at our Watertown, Massachusetts location where we conduct process development, scale-up activities and the manufacture of ImmTOR product candidates for preclinical use.
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We may choose to establish a manufacturing facility for our product candidates for production at a commercial scale.
−Removed: However, we have no experience in commercial‑scale manufacturing of our product candidates and this activity will require substantial additional funds and additional qualified employees.
+Added: However, we have no experience in commercial-scale manufacturing of our product candidates and this activity will require substantial additional funds and qualified employees.
We may not be able to develop commercial-scale manufacturing facilities that are adequate to produce materials for additional later-stage clinical trials or commercial use.
−Removed: The equipment and facilities employed in the manufacture of pharmaceuticals are subject to stringent qualification requirements by regulatory agencies, including validation of such facilities, equipment, systems, processes and analytics.
−Removed: We may be subject to lengthy delays and expense in conducting validation studies, if we can meet the requirements at all.
−Removed: RISKS RELATED TO COMMERCIALIZATION OF OUR PRODUCT CANDIDATES AND OTHER LEGAL COMPLIANCE MATTERS
+Added: Risks Related to Commercialization of our Product Candidates and Legal Compliance Matters
Even if any of our product candidates receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success.
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If our product candidates do not achieve an adequate level of acceptance, we may not generate significant product revenues and we may not become profitable.
−Removed: For example, even if the statistical results from our Phase 2 head-to-head (COMPARE) trial vs.
−Removed: KRYSTEXXA favor SEL-212 and SEL-212 receives marketing approval, the drug may fail to gain market acceptance from physicians, patients, third-party payors and others in the medical community who may continue to favor KRYSTEXXA.
−Removed: The degree of market acceptance of our product candidates, if any, will depend on a number of factors, including:
−Removed: their efficacy, safety and other potential advantages compared to alternative treatments;
−Removed: the clinical indications for which our product candidates are approved;
−Removed: our ability to offer them for sale at competitive prices;
−Removed: their convenience and ease of administration compared to alternative treatments;
−Removed: the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies;
+Added: The degree of market acceptance of our product candidates, if approved for commercial sale, will depend on a number of factors, including:
+Added: • the efficacy, safety and potential advantages compared to alternative treatments;
+Added: • our ability to offer our products for sale at competitive prices;
+Added: • the convenience and ease of administration compared to alternative treatments;
+Added: • product labeling or product insert requirements of the FDA or foreign regulatory authorities, including any limitations or warnings contained in a product’s approved labeling, including any black box warning or REMS;
+Added: • the willingness of the target patient population to try new treatments and of physicians to prescribe these treatments;
+Added: • our ability to hire and retain a sales force in the United States;
• the strength of marketing and distribution support;
−Removed: the availability of third‑party coverage and adequate reimbursement for our product candidates;
−Removed: the prevalence and severity of their side effects and their overall safety profiles;
−Removed: any restrictions on the use of our product candidates together with other medications;
−Removed: interactions of our product candidates with other medicines patients are taking;
−Removed: our ability to create awareness with patients and physicians about the harmful effects of uric acid deposits;
−Removed: the timing of market introduction of any approved product candidates as well as competitive products and other therapies;
−Removed: inability of certain types of patients, particularly with respect to certain rare diseases or conditions, to take our product candidates;
−Removed: their ability to remain attractive in the event of changing treatment guidelines;
−Removed: adverse publicity about the product or favorable publicity about competitive products;
−Removed: potential product liability claims.
+Added: • the availability of third-party coverage and adequate reimbursement for our product candidates, once approved;
+Added: • the prevalence and severity of any side effects;
+Added: • any restrictions on the use of our products together with other medications.
We currently have no sales organization.
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To achieve commercial success for any product candidate for which we obtain marketing approval, we will need to establish a sales and marketing organization or make arrangements with third parties to perform sales and marketing functions and we may not be successful in doing so.
−Removed: In the future, we expect to build a focused sales and marketing infrastructure to market or co‑promote our product candidates in the United States and potentially elsewhere, if and when they are approved.
+Added: We expect to build a focused sales and marketing infrastructure to market or co-promote our product candidates in the United States and potentially elsewhere, if and when they are approved.
There are risks involved with establishing our own sales, marketing and distribution capabilities.
For example, recruiting and training a sales force is expensive and time-consuming and could delay any product launch.
−Removed: If the commercial launch of a product candidate for which we recruit a sales force and establish marketing capabilities is delayed or does not occur for any reason, we would have prematurely or unnecessarily incurred these commercialization expenses.
This may be costly, and our investment would be lost if we cannot retain or reposition our sales and marketing personnel.
−Removed: Outside the United States, we may rely on third parties to sell, market and distribute our product candidates.
−Removed: We may not be successful in entering into arrangements with such third parties or may be unable to do so on terms that are favorable to us.
−Removed: In addition, our product revenue and our profitability, if any, may be lower if we rely on third parties for these functions than if we were to market, sell and distribute any products that we develop ourselves.
−Removed: We likely will have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market our products effectively.
−Removed: If we do not establish sales, marketing and distribution capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates.
We face substantial competition, including from biosimilars, which may result in others discovering, developing or commercializing competing products before or more successfully than we do.
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We expect the product candidates we develop will be regulated as biological products, or biologics, and therefore they may be subject to competition sooner than anticipated.
−Removed: The Biologics Price Competition and Innovation Act of 2009 (BPCIA) was enacted as part of the Affordable Care Act to establish an abbreviated pathway for the approval of biosimilar and interchangeable biological products.
+Added: The BPCIA was enacted as part of the Affordable Care Act to establish an abbreviated pathway for the approval of biosimilar and interchangeable biological products.
The regulatory pathway establishes legal authority for the FDA to review and approve biosimilar biologics, including the possible designation of a biosimilar as “interchangeable” based on its similarity to an approved biologic.
Under the BPCIA, an application for a biosimilar product cannot be approved by the FDA until 12 years after the reference product was approved under a BLA.
−Removed: The law is complex and is still being interpreted and implemented by the FDA.
−Removed: As a result, its ultimate impact, implementation, and meaning are subject to uncertainty.
−Removed: While it is uncertain when such processes intended to implement the BPCIA may be fully adopted by the FDA, any such processes could have a material adverse effect on the future commercial prospects for our biological products.
+Added: The law is still being interpreted and implemented by the FDA, and as a result, its ultimate impact, implementation, and meaning are subject to uncertainty.
+Added: However, any such processes could have a material adverse effect on the future commercial prospects for our biological products.
We believe that any product candidate approved in the United States as a biological product under a BLA should qualify for the 12-year period of exclusivity.
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Obtaining and maintaining adequate reimbursement for our products may be difficult.
−Removed: We cannot be certain if and when we will obtain an adequate level of reimbursement for our products by third‑party payors.
−Removed: Even if we do obtain adequate levels of reimbursement, third‑party payors, such as government or private healthcare insurers, carefully review and increasingly question the coverage of, and challenge the prices charged for, products.
−Removed: Government authorities and third‑party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications.
−Removed: Increasingly, third‑party payors are requiring that pharmaceutical companies provide them with predetermined discounts from list prices and are challenging the prices charged for products.
+Added: We cannot be certain if we will obtain an adequate level of reimbursement for our products by third-party payors.
+Added: Even if we do obtain adequate levels of reimbursement, third-party payors, such as government or private healthcare insurers, carefully review and question the coverage of, and challenge the prices charged for, products.
+Added: Government authorities and third-party payors have attempted to
+Added: control costs by limiting coverage and the amount of reimbursement for particular medications.
+Added: Third-party payors often require that pharmaceutical companies provide them with predetermined discounts from list prices and are challenging the prices charged for products.
We may also be required to conduct expensive pharmacoeconomic studies to justify coverage and reimbursement or the level of reimbursement relative to other therapies.
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Reimbursement rates may vary according to the use of the product and the clinical setting in which it is used, may be based on reimbursement levels already set for lower cost products and may be incorporated into existing payments for other services.
−Removed: Net prices for products may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of products from countries where they may be sold at lower prices than in the
−Removed: United States.
+Added: Net prices for products may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of products from countries where they may be sold at lower prices than in the United States.
Our inability to promptly obtain coverage and adequate reimbursement rates from both government-funded and private payors for any approved products that we develop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize products and our overall financial condition.
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There can be no assurance that our product candidates, if they are approved for sale in the United States or in other countries, will be considered medically necessary for a specific indication or cost-effective, or that coverage or an adequate level of reimbursement will be available.
−Removed: Moreover, there has recently been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and proposed bills designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drug products.
−Removed: There can be no assurance that our product candidates, if approved for sale in the United States or in other countries, will not be subject to heightened governmental scrutiny, unfavorable regulatory inquiry or action, or congressional inquiry.
+Added: Moreover, there is heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and proposed bills designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drug products.
+Added: There can be no assurance that our product candidates, will not be subject to heightened governmental scrutiny, unfavorable regulatory inquiry or action, or Congressional inquiry.
Product liability lawsuits against us could cause us to incur substantial liabilities and limit commercialization of any products that we may develop.
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We may not be able to maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise.
−Removed: A successful product liability claim or series of claims brought against us could cause our share price to decline and, if judgments exceed our insurance coverage, could adversely affect our results of operations and business, including preventing or limiting the commercialization of any product candidates we develop.
−Removed: Failure to obtain marketing approval in international jurisdictions would prevent our product candidates from being marketed abroad.
−Removed: Although we do not have any current plans to market and sell our products in other jurisdictions outside of the United States, we may decide to do so in the future and either we or our collaborators would need to obtain separate marketing approvals and comply with numerous and varying regulatory requirements.
−Removed: The approval procedure varies among countries and can involve
−Removed: additional testing.
−Removed: The time required to obtain approval in foreign countries may differ substantially from that required to obtain FDA approval.
−Removed: Clinical trials conducted in one country may not be accepted by regulatory authorities in other countries.
−Removed: The regulatory approval process outside the United States generally includes all of the risks associated with obtaining FDA approval.
−Removed: In addition, in many countries outside the United States, it is required that the product candidate be approved for reimbursement before the product candidate can be approved for sale in that country.
−Removed: We or our collaborators may not obtain approvals for our product candidates from regulatory authorities outside the United States on a timely basis, if at all.
−Removed: Approval by the FDA does not ensure approval by regulatory authorities in other countries or jurisdictions, and approval by one regulatory authority outside the United States does not ensure approval by regulatory authorities in other countries or jurisdictions, or by the FDA.
−Removed: However, a failure or delay in obtaining regulatory approval in one country may have a negative effect on the regulatory process in others.
−Removed: We may not be able to file for marketing approvals and may not receive necessary approvals to commercialize our product candidates in any market.
+Added: A product liability claim or series of claims brought against us could cause our share price to decline and, if judgments exceed our insurance coverage, could adversely affect our results of operations and business, including preventing or limiting the commercialization of any product candidates we develop.
Our relationships with healthcare providers, customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, exclusion from government healthcare programs, contractual damages, reputational harm and diminished profits and future earnings.
6 unchanged sentences
in addition, the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act;
−Removed: the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for, among other things, executing or attempting to execute a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters.
+Added: • HIPAA which imposes criminal and civil liability for, among other things, executing or attempting to execute a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters.
A person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation;
−Removed: HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, or HITECH, and its implementing regulations, which also imposes obligations, including mandatory contractual terms, on certain types of people and entities with respect to safeguarding the privacy, security and transmission of individually identifiable health information;
+Added: • HIPAA, as amended by HITECH and its implementing regulations, which also imposes obligations, including mandatory contractual terms, on certain types of people and entities with respect to safeguarding the privacy, security and transmission of individually identifiable health information;
• the federal Physician Payments Sunshine Act, which requires applicable manufacturers of certain products for which payment is available under a federal healthcare program to report annually to the government information related to certain payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other health care professionals beginning in 2022, and teaching hospitals, as well as ownership and investment interests held by the physicians and their immediate family members;
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Although the law includes limited exceptions, including for “protected health information” maintained by a covered entity or business associate, it may regulate or impact our processing of personal information depending on the context;
−Removed: similar healthcare laws and regulations in the European Union and other jurisdictions, including reporting requirements detailing interactions with and payments to healthcare providers and laws governing the privacy and security of certain protected information, such as the General Data Protection Regulation, or GDPR, which imposes obligations and restrictions on the collection and use of personal data relating to individuals located in the European Union (including health data);
+Added: • similar healthcare laws and regulations in the European Union and other jurisdictions, including reporting requirements detailing interactions with and payments to healthcare providers and laws governing the privacy and
+Added: security of certain protected information, such as the General Data Protection Regulation, or GDPR, which imposes obligations and restrictions on the collection and use of personal data relating to individuals located in the European Union (including health data);
in addition, the United Kingdom leaving the E.U.
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It remains unclear how the United Kingdom data protection laws or regulations will develop in the medium to longer term and how data transfer to the United Kingdom from the E.U.
−Removed: will be regulated, especially following the United Kingdom's departure from the E.U.
−Removed: on January 31, 2020 without a deal.
+Added: will be regulated.
However, the United Kingdom has transposed the GDPR into domestic law with the Data Protection Act 2018, which remains in force following the United Kingdom's departure from the E.U.
6 unchanged sentences
In the United States and some foreign jurisdictions, there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval of our product candidates, restrict or regulate post-approval activities and affect our ability to profitably sell any product candidates for which we obtain marketing approval.
−Removed: For example, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively the ACA, a sweeping law intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add new transparency requirements for the healthcare and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy reforms.
−Removed: Among the provisions of the ACA of importance to our potential product candidates are the following:
−Removed: an annual, nondeductible fee payable by any entity that manufactures or imports specified branded prescription drugs and biologic agents;
−Removed: an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program;
−Removed: a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected;
−Removed: extension of manufacturers’ Medicaid rebate liability to individuals enrolled in Medicaid managed care organizations;
−Removed: expansion of the entities eligible for discounts under the Public Health Service pharmaceutical pricing program;
−Removed: a new requirement to annually report drug samples that manufacturers and distributors provide to physicians;
−Removed: a new Patient‑Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.
+Added: For example, the ACA, a sweeping law intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add new transparency requirements for the healthcare and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy reforms.
Since its enactment, there have been judicial and Congressional challenges to certain aspects of the ACA.
−Removed: By way of example, the Tax Cuts and Jobs Acts, or the Tax Act, was enacted, which, among other things, removes penalties for not complying with the individual mandate to carry health insurance.
−Removed: On December 14, 2018, a U.S.
−Removed: District Court Judge in the Northern District of Texas, ruled that the individual mandate is a critical and inseverable feature of the ACA, and therefore, because it was repealed as part of the Tax Act, the remaining provisions of the ACA are invalid as well.
−Removed: On December 18, 2019, the U.S.
−Removed: Court of Appeals for the 5th Circuit ruled that the individual mandate was unconstitutional and remanded the case back to the District Court to determine whether the remaining provisions of the ACA are invalid as well.
+Added: By way of example, the TCJA was enacted, which, among other things, removes penalties for not complying with the individual mandate to carry health insurance.
+Added: In 2018, a U.S.
+Added: District Court Judge in the Northern District of Texas, ruled that the individual mandate is a critical and inseverable feature of the ACA, and therefore, because it was repealed as part of the TCJA, the remaining provisions of the ACA are invalid as well.
+Added: In December 2019, the U.S.
+Added: Court of Appeals for the Fifth Circuit ruled that the individual mandate was unconstitutional and remanded the case back to the District Court to determine whether the remaining provisions of the ACA are invalid as well.
It is unclear how these decisions, subsequent appeals, if any, and other efforts to challenge, repeal or replace the ACA will impact the ACA or our business.
−Removed: cannot predict the ultimate content, timing or effect of any healthcare reform legislation or the impact of potential legislation on us.
+Added: We cannot predict the ultimate content, timing or effect of any healthcare reform legislation or the impact of potential legislation on us.
We expect that the ACA, as well as other healthcare reform measures that may be adopted in the future, may result in additional reductions in Medicare and other healthcare funding, more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price that we receive for any approved product.
1 unchanged sentence
The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability or commercialize our products.
−Removed: Even if we receive regulatory approval for any of our product candidates, we will be subject to ongoing obligations and continued regulatory review, which may result in significant additional expense.
−Removed: Additionally, any of our product candidates, if approved, could be subject to post ‑ marketing restrictions or withdrawal from the market, and we may be subject to penalties if we fail to comply with regulatory requirements or if we experience unexpected problems with our products.
−Removed: Any product candidate for which we obtain marketing approval, along with the manufacturing processes, post‑approval clinical data, labeling, advertising and promotional activities for such product, will be subject to the continual requirements of and review by the FDA and other regulatory authorities.
−Removed: These requirements include submissions of safety and other post‑marketing information and reports, registration and listing requirements, cGMP requirements relating to manufacturing, quality control, quality assurance and corresponding maintenance of records and documents, requirements regarding the distribution of samples to physicians and recordkeeping.
−Removed: We and our contract manufacturers will also be subject to continual review and periodic inspections to assess compliance with cGMP.
−Removed: Accordingly, we and others with whom we work must continue to expend time, money and effort in all areas of regulatory compliance, including manufacturing, production and quality control.
−Removed: Even if marketing approval of a product candidate is granted, the approval may be subject to limitations on the indicated uses for which the product may be marketed or to the conditions of approval, including the requirement to implement a risk evaluation and mitigation strategy, or REMS, which could include requirements for a medication guide, physician communication plans or additional elements to assure safe use, such as restricted distribution methods, patient registries and other risk mitigation tools.
−Removed: If any of our product candidates receives marketing approval, the accompanying label may limit the approved use of our product, which could limit sales of the product.
−Removed: The FDA may also impose requirements for costly post‑marketing studies or clinical trials and surveillance to monitor the safety or efficacy of our approved products.
−Removed: The FDA closely regulates the post‑approval marketing and promotion of drugs and biologics to ensure they are marketed only for the approved indications and in accordance with the provisions of the approved labeling.
−Removed: The FDA imposes stringent restrictions on manufacturers’ communications regarding off‑label use, and if we market our products outside of their approved indications, we may be subject to enforcement action for off‑label marketing.
−Removed: Violations of the FDA’s restrictions relating to the promotion of prescription products may also lead to investigations alleging violations of federal and state health care fraud and abuse laws, as well as state consumer protection laws.
−Removed: In addition, if a regulatory agency or we later discover previously unknown problems with our products, such as adverse events of unexpected severity or frequency or problems with manufacturers or manufacturing processes, the regulatory agency may impose restrictions on the products or us, including requiring withdrawal of the product from the market.
−Removed: Any failure to comply with applicable regulatory requirements may yield various results, including:
−Removed: litigation involving patients taking our products;
−Removed: restrictions on such products, manufacturers or manufacturing processes;
−Removed: restrictions on the labeling or marketing of a product;
−Removed: restrictions on product distribution or use;
−Removed: requirements to conduct post‑marketing studies or clinical trials;
−Removed: warning letters;
−Removed: withdrawal of products from the market;
−Removed: suspension or termination of ongoing clinical trials;
−Removed: refusal to approve pending applications or supplements to approved applications that we submit;
−Removed: recall of products;
−Removed: fines, restitution or disgorgement of profits or revenues;
−Removed: suspension or withdrawal of marketing approvals;
−Removed: damage to relationships with existing and potential collaborators;
−Removed: unfavorable press coverage and damage to our reputation;
−Removed: refusal to permit the import or export of our products;
−Removed: product seizure or detention;
−Removed: imposition of civil or criminal penalties.
−Removed: Noncompliance with other requirements in foreign jurisdictions regarding safety monitoring or pharmacovigilance can also result in significant financial penalties.
−Removed: Similarly, failure to comply with U.S.
−Removed: and foreign regulatory requirements regarding the development of products for pediatric populations and the protection of personal health information can also lead to significant penalties and sanctions.
−Removed: Any government investigation of alleged violations of law could require us to expend significant time and resources in response, and could generate negative publicity.
−Removed: Any failure to comply with ongoing regulatory requirements may significantly and adversely affect our ability to commercialize and generate revenues.
−Removed: If regulatory sanctions are applied or if regulatory approval is withheld or withdrawn, the value of our company and our operating results will be adversely affected.
−Removed: The FDA’s and other regulatory authorities’ policies may change, and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
−Removed: If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition and results of operations.
−Removed: We also cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action, either in the United States or abroad.
−Removed: For example, certain policies of the current administration may impact our business and industry.
−Removed: Namely, the Trump administration has taken several executive actions, including the issuance of a number of Executive Orders, that could impose significant burdens on, or otherwise materially delay, FDA’s ability to engage in routine regulatory and oversight activities such as implementing statutes through rulemaking, issuance of guidance, and review and approval of marketing applications.
−Removed: It is difficult to predict how these Executive Orders will be implemented, and the extent to which they will impact the FDA’s ability to exercise its regulatory authority.
−Removed: If these executive actions impose constraints on FDA’s ability to engage in oversight and implementation activities in the normal course, our business may be negatively impacted.
−Removed: Changes in funding for the FDA and other government agencies could hinder their ability to hire and retain key leadership and other personnel, or otherwise prevent new products and services from being approved, developed or commercialized in a timely manner, which could negatively impact our business.
−Removed: The ability of the FDA to review and approve new products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes.
+Added: Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved or commercialized in a timely manner or at all, which could negatively impact our business.
+Added: The ability of the FDA to review and or approve new products can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory, and policy changes, the FDA’s ability to hire and retain key personnel and accept the payment of user fees, and other events that may otherwise affect the FDA’s ability to perform routine functions.
Average review times at the agency have fluctuated in recent years as a result.
In addition, government funding of other government agencies that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable.
−Removed: Disruptions at the FDA and other agencies may also slow the time necessary for new drugs to be reviewed and/or approved by necessary government agencies, which would adversely affect our business.
−Removed: For example, over the last several years, including for 35 days beginning on December 22, 2018, the U.S.
−Removed: government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical FDA employees and stop critical activities.
−Removed: If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business
+Added: Disruptions at the FDA and other agencies may also slow the time necessary for new drugs and biologics to be reviewed and/or approved by necessary government agencies, which would adversely affect our business.
+Added: Separately, in response to the COVID-19 pandemic, the FDA has periodically modified its regular practices with respect to inspection of manufacturing facilities.
+Added: The FDA intends to use this risk-based assessment system to identify the categories of
+Added: regulatory activity that can occur within a given geographic area, ranging from mission critical inspections to resumption of all regulatory activities.
+Added: Regulatory authorities outside the United States may adopt similar restrictions or other policy measures in response to the COVID-19 pandemic.
+Added: If a prolonged government shutdown occurs, or if global health concerns continue to prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.
We are subject to U.S.
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§ 201, the U.S.
−Removed: Travel Act, the USA PATRIOT Act, and other state and national anti‑bribery and anti‑money laundering laws in the countries in which
−Removed: we conduct activities.
+Added: Travel Act, the USA PATRIOT Act, and other state and national anti-bribery and anti-money laundering laws in the countries in which we conduct activities.
sanctions laws and regulations may govern or restrict our business and activities in certain countries and with certain persons.
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Our violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm and other consequences.
−Removed: Governments outside the United States tend to impose strict price controls, which may adversely affect our revenues, if any.
−Removed: In some countries, the pricing of prescription pharmaceuticals is subject to governmental control.
−Removed: In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product candidate.
−Removed: In addition, there can be considerable pressure by governments and other stakeholders on prices and reimbursement levels, including as part of cost containment measures.
−Removed: Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after coverage and reimbursement have been obtained.
−Removed: Reference pricing used by various countries and parallel distribution or arbitrage between low‑priced and high‑priced countries, can further reduce prices.
−Removed: To obtain reimbursement or pricing approval in some countries, we may be required to conduct a clinical trial that compares the cost‑effectiveness of our product candidate to other available therapies, which is time‑consuming and costly.
−Removed: If coverage and reimbursement of our product candidates are unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could be materially adversely affected.
If we or our contract manufacturers or other third parties fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse effect on our business.
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The patent prosecution process is expensive and time-consuming, and we may not be able to file and prosecute all necessary or desirable patent applications at a reasonable cost, in a timely manner or in all jurisdictions.
−Removed: As we reach the statutory deadlines for deciding whether and where to initiate prosecution in specific foreign jurisdictions by filing national stage applications based on our Patent Cooperation Treaty, or PCT, applications, we will have to decide whether and where to pursue patent
−Removed: protection for the various inventions claimed in our patent portfolio, and we will only have the opportunity to obtain patents in those jurisdictions where we pursue protection.
+Added: As we reach the statutory deadlines for deciding whether and where to initiate prosecution in specific foreign jurisdictions by filing national stage applications based on our Patent Cooperation Treaty, or PCT, applications, we will have to decide whether and where to pursue patent protection for the various inventions claimed in our patent portfolio, and we will only have the opportunity to obtain patents in those jurisdictions where we pursue protection.
It is also possible that we will fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection.
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Even if issued, a patent’s validity, inventorship, ownership or enforceability is not conclusive.
−Removed: Accordingly, rights under any existing patent or any patents we might obtain or license may not cover our product candidates, or may not provide us with sufficient protection for our product candidates to afford a commercial advantage against competitive products or processes, including those from branded and generic pharmaceutical companies.
+Added: Accordingly, rights under any existing patent or any
+Added: patents we might obtain or license may not cover our product candidates, or may not provide us with sufficient protection for our product candidates to afford a commercial advantage against competitive products or processes, including those from branded and generic pharmaceutical companies.
In addition to the protection afforded by patents, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how, information, or technology that is not covered by our patents.
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In addition, recent patent reform legislation could further increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents.
−Removed: On September 16, 2011, the Leahy‑Smith America Invents Act, or the Leahy‑Smith Act, was signed into law.
−Removed: The Leahy‑Smith Act includes a number of significant changes to U.S.
+Added: The Leahy-Smith Act America Invents Act, or the Leahy-Smith Act, included a number of significant changes to U.S.
These include provisions that affect the way patent applications are prosecuted and may also affect patent litigation.
−Removed: The USPTO recently developed new regulations and procedures to govern administration of the Leahy‑Smith Act, and many of the substantive changes to patent law associated with the Leahy‑Smith Act, in particular the first to file provisions, became effective on March 16, 2013.
−Removed: A third party that files a patent application in the USPTO after that date but before us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by the third party.
+Added: The USPTO recently developed new regulations and procedures to govern administration of the Leahy-Smith Act, including its first-to-file provisions.
+Added: A third party that files a patent application in the USPTO before us could therefore be awarded a patent covering an invention of ours even if we had made the invention before it was made by the third party.
This requires us to be cognizant of the time from invention to filing of a patent application.
Thus, for our U.S.
−Removed: patent applications containing a priority claim after March 16, 2013, there is a greater level of uncertainty in the patent law.
−Removed: Moreover, some of the patent applications in our portfolio will be subject to examination under the pre‑Leahy‑Smith Act law and regulations, while other patents applications in our portfolio will
−Removed: be subject to examination under the law and regulations, as amended by the Leahy‑Smith Act.
+Added: patent applications containing a priority claim after March 16, 2013, the date such provisions became effective, there is a greater level of uncertainty in the patent law.
+Added: Moreover, some of the patent applications in our portfolio will be subject to examination under the pre-Leahy-Smith Act law
+Added: and regulations, while other patents applications in our portfolio will be subject to examination under the law and regulations, as amended by the Leahy-Smith Act.
This introduces additional complexities into the prosecution and management of our portfolio.
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While an inadvertent lapse can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which noncompliance can result in abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction.
−Removed: Noncompliance events that could result in abandonment or lapse of a patent or patent application include, but are not limited to, failure to respond to official actions within prescribed time limits, non‑payment of fees and failure to properly
−Removed: legalize and submit formal documents.
+Added: Noncompliance events that could result in abandonment or lapse of a patent or patent application include, but are not limited to, failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents.
In such an event, our competitors might be able to enter the market, which would have an adverse effect on our business.
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We may also be unable to maintain third-party intellectual property rights.
−Removed: For example, MIT may terminate the MIT License if we fail to meet a diligence obligation, including the initiation of a Phase 3 clinical trial by a specified date in the fourth quarter of 2019.
−Removed: In December 2019, we entered into the MIT Amendment.
−Removed: Pursuant to the MIT Amendment, the provision of the MIT License under which we were obligated to initiate a Phase 3 clinical trial for a licensed product by a specified date in the fourth quarter of 2019 is tolled until the earlier of (i) a specified date in the second quarter of 2020 or (ii) the effective date of a written amendment to the MIT License.
−Removed: The parties agreed to negotiate in good faith to enter into a future amendment to the MIT License after we provide MIT with an amended diligence plan.
−Removed: However, if we are unable to reach an agreement with MIT regarding an acceptable amendment of the MIT License and if we are unable to cure the breach, there could be a material adverse effect on our business.
−Removed: See “Business - Licenses and Collaborations - Massachusetts Institute of Technology.”
+Added: For example, MIT may terminate the MIT License if we fail to meet our diligence obligations under the agreement.
If we are unable to successfully obtain rights to required third-party intellectual property rights or maintain the existing intellectual property rights we have, we may have to abandon development of that program and our business and financial condition could suffer.
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Even if we are successful in prosecuting or defending against such claims, litigation could result in substantial costs and be a distraction to management.
−Removed: If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected.
−Removed: Our registered or unregistered trademarks or trade names may be challenged, infringed, circumvented or declared generic or determined to be infringing on other marks.
−Removed: We may not be able to protect our rights to these trademarks and trade names, which we need to build name recognition among potential collaborators or customers in our markets of interest.
−Removed: At times, competitors may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion.
−Removed: In addition, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names.
−Removed: Over the long term, if we are unable to establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively and our business may be adversely affected.
−Removed: Our efforts to enforce or protect our proprietary rights related to trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources and could adversely impact our financial condition or results of operations.
We will not seek to protect our intellectual property rights in all jurisdictions throughout the world and we may not be able to adequately enforce our intellectual property rights even in the jurisdictions where we seek protection.
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Risks Related to our Operations
−Removed: Our new corporate strategy may not be successful.
−Removed: On January 3, 2019, following a strategic business review, we announced our new strategy to focus on the development of SEL-212 for the treatment of chronic refractory gout and advancement of our ImmTOR platform in the area of gene therapy, specifically ImmTOR in combination with AAV gene therapy for the treatment of CN and MMA, as well as the deprioritization of our oncology development program.
−Removed: The success of this strategic shift will depend on our ability to successfully develop our product candidates, hire and retain senior management or other highly qualified personnel, prioritize competing projects and efforts and obtain sufficient resources, including additional capital, as well as our ability to enter into collaborations with third parties.
+Added: Our corporate strategy may not be successful.
+Added: On January 3, 2019, following a strategic business review, we announced a strategy to focus on the development of SEL-212 for the treatment of chronic refractory gout and advancement of our ImmTOR platform in the area of gene therapy, specifically ImmTOR in combination with AAV gene therapy for the treatment of CN and MMA, as well as the deprioritization of our oncology development program.
+Added: The success of this strategic shift depends on our ability to successfully develop our product candidates, hire and retain senior management or other highly qualified personnel, prioritize competing projects and efforts and obtain sufficient resources, including additional capital, as well as our ability to enter into collaborations with third parties.
The early stage development of novel product candidates is highly unpredictable due to the lengthy and expensive process of clinical drug development, potential for safety, efficacy or tolerability problems with such product candidates, unexpected expenses or inaccurate financial assumptions or forecasts, potential delays or unfavorable decisions of regulatory agencies and competition for targeted indications or within targeted markets.
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If we are unable to continue to attract and retain high quality personnel, our ability to pursue our growth strategy will be limited.
−Removed: 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.
−Removed: We expect to experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of lead discovery and product development, regulatory affairs, clinical affairs and manufacturing and, if any of our product candidates receives marketing approval, sales, marketing and distribution.
−Removed: To manage our expected 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.
−Removed: Due to our limited financial resources and the limited experience of our management team in managing a company with such expected growth, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel in a timely manner, if at all.
−Removed: The expansion of our operations may lead to significant costs and may divert our management and business development resources.
−Removed: Any inability to manage or financially support growth could delay the execution of our business plans or disrupt our operations.
We have incurred increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance initiatives and corporate governance practices.
−Removed: As a public company, and particularly after we are no longer an emerging growth company, we have incurred and expect to continue to incur significant legal, accounting and other expenses that we did not incur as a private company.
−Removed: The Sarbanes‑Oxley Act of 2002, the Dodd‑Frank Wall Street Reform and Consumer Protection Act, the listing requirements of The Nasdaq Global Market and other applicable securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices.
+Added: As a public company, we have incurred and expect to continue to incur significant legal, accounting and other expenses.
+Added: The Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of The Nasdaq Stock Market LLC and other applicable securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective disclosure and financial controls and corporate governance practices.
Our management and other personnel need to devote a substantial amount of time to these compliance initiatives.
−Removed: Moreover, these rules and regulations have increased our legal and financial compliance costs and made some activities more time‑consuming and costly.
+Added: Moreover, these rules and regulations bring with them significant legal and financial compliance costs and made some activities more time-consuming and costly.
Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, we are required to furnish a report by our management on our internal control over financial reporting.
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• financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our product candidates and exposure to foreign currency exchange rate fluctuations, which could result in increased operating expenses and reduced revenues;
−Removed: natural disasters, political and economic instability, including wars, events of terrorism and political unrest, outbreak of disease, including the novel coronavirus boycotts, curtailment of trade and other business restrictions and economic weakness, including inflation;
+Added: • natural disasters, political and economic instability, including wars, events of terrorism and political unrest, outbreak of disease, including the COVID-19 coronavirus, boycotts, curtailment of trade and other business restrictions and economic weakness, including inflation;
• changes in diplomatic and trade relationships;
• challenges in enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States;
−Removed: restriction on cross-border investment, including enhanced oversight by the Committee on Foreign Investment in the United States (CFIUS) and substantial restrictions on investment from China;
+Added: • restriction on cross-border investment, including enhanced oversight by the Committee on Foreign Investment in the United States and substantial restrictions on investment from China;
• certain expenses including, among others, expenses for travel, translation and insurance;
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While we are not aware of any such material system failure, accident or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our development programs and our business operations.
−Removed: For example, the loss of clinical trial data from completed or future clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.
Likewise, we rely on third parties to manufacture our product candidates and conduct clinical trials, and similar events relating to their computer systems could also have a material adverse effect on our business.
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Also, the expected benefit of any acquisition may not materialize.
−Removed: Future acquisitions or dispositions could result in potentially dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities or amortization expenses or write‑offs of goodwill, any of which could harm our financial condition.
+Added: Future acquisitions or dispositions could result in potentially dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities or amortization expenses or
+Added: write-offs of goodwill, any of which could harm our financial condition.
We cannot predict the number, timing or size of future joint ventures or acquisitions, or the effect that any such transactions might have on our operating results.
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• changes in physician, hospital or healthcare provider practices that may make our product candidates less useful;
−Removed: announcements by us, our partners or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments;
+Added: • announcements by us, our collaborators or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments;
• announcement or market expectation of additional financing efforts;
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For example, these persons, if they choose to act together, would control or significantly influence the election of directors, the composition of our management and approval of any merger, consolidation or sale of all or substantially all of our assets.
−Removed: A significant portion of our total outstanding shares are eligible to be sold into the market, which could cause the market price of our common stock to drop significantly, even if our business is doing well.
Sales of a substantial number of shares of our common stock in the public market, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock.
−Removed: Holders of an aggregate of approximately 0.34 million shares of our common stock as of December 31, 2019 have rights, subject to specified conditions, to require us to file registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or other stockholders, until such shares can otherwise be sold without restriction under Rule 144 or until the rights terminate pursuant to the terms of the investors’ rights agreement between us and such holders.
−Removed: We have also registered and intend to continue to register all shares of common stock that we may issue under our equity compensation plans.
−Removed: Once we register these shares, they can be freely sold in the public market upon issuance, subject to volume limitations applicable to affiliates.
−Removed: In addition, on June 27, 2017, we issued and sold in a private placement 3,088,791 shares of our common stock (of which 338,791 shares have continuing registration rights) and a warrant to purchase 79,130 shares of our common stock, including to certain of our affiliates.
−Removed: Pursuant to a registration rights agreement entered into with the investors in the private placement, on July 13, 2017, we filed a Registration Statement on Form S-3 to register the shares of common stock sold in the private
−Removed: placement and the shares of common stock issuable upon exercise of the warrant.
−Removed: Similarly, on December 23, 2019, we issued and sold in a private placement 37,634,883 shares of our common stock and warrants to purchase 31,330,629 shares of our common stock, including to certain of our affiliates.
−Removed: Pursuant to a registration rights agreement entered into with the investors in the private placement, on January 29, 2019, we filed a Registration Statement on Form S-3 to register the shares of common stock sold in the private placement and the shares of common stock issuable upon exercise of the warrant.
−Removed: As a result, these shares can be freely sold in the public market.
+Added: Sales of a substantial number of shares of our common stock in the public market could occur at any time.
+Added: These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock reduce.
+Added: As of December 31, 2020, we had 108,071,249 shares of common stock outstanding.
+Added: In addition, as of December 31, 2020, 7,775,249 and 87,500 shares of common stock that are subject to outstanding options or restricted stock unit awards, respectively, under our outstanding equity plans are eligible for sale in the public market to the extent permitted by the provisions of various vesting schedules, and Rule 144 under the Securities Act.
+Added: If these additional shares of common stock are sold, or it is perceived that they will be sold, in the public market, the trading price of our common stock could decline.
We may not have the funds necessary to fulfill our obligation to repurchase certain warrants.
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We are an “emerging growth company,” and the reduced disclosure requirements applicable to emerging growth companies may make our common stock less attractive to investors .
−Removed: We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and may remain an emerging growth company until the last day of the fiscal year following the fifth anniversary of the closing of the initial public offering of our common stock.
+Added: We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and may remain an emerging growth company until December 31, 2021, the last day of the fiscal year following the fifth anniversary of the closing of the initial public offering of our common stock.
However, if certain events occur prior to the end of such five-year period, including if we become a “large accelerated filer,” our annual gross revenues exceed $1.07 billion or we issue more than $1.07 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company prior to the end of such five-year period.
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• exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
−Removed: We cannot predict whether investors will find our common stock less attractive if we rely on these exemptions.
We have, historically, relied on these exemptions, and we may continue to do so until they are no longer available to us.
−Removed: If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be reduced or more volatile.
In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards.
1 unchanged sentence
We have irrevocably elected not to avail ourselves of this exemption and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.
−Removed: If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our stock, our stock price and trading volume could decline.
−Removed: The trading market for our common stock will be influenced by the research and reports that industry or securities analysts publish about us or our business.
−Removed: If any of the analysts who cover us issue an adverse or misleading opinion regarding us, our business model, our intellectual property or our stock performance, or if our preclinical studies, clinical trial programs and operating results fail to meet the expectations of analysts, our stock price would likely decline.
−Removed: If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.
Provisions in our restated certificate of incorporation and restated bylaws and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.
−Removed: Provisions in our restated certificate of incorporation and our restated bylaws, which became effective upon the closing of the initial public offering of our common stock may discourage, delay or prevent a merger, acquisition or other change in control of
−Removed: our company that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares.
+Added: Provisions in our restated certificate of incorporation and our restated bylaws, which became effective upon the closing of the initial public offering of our common stock may discourage, delay or prevent a merger, acquisition or other change in control of our company that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares.
These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of our common stock.
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However, the provision may have the effect of discouraging lawsuits against our directors, officers, employees and agents as it may limit any stockholder’s ability to bring a claim in a judicial forum that such stockholder finds favorable for disputes with us or our directors, officers, employees or agents.
−Removed: The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that, in connection with any applicable action brought against us, a court could find the choice of forum provisions contained in our restated certificate of incorporation to be applicable or unenforceable in such action.
−Removed: We could be subject to securities class action litigation.
+Added: We are involved in two securities class action lawsuits.
In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities.
This risk is especially relevant for us because biopharmaceutical companies have experienced significant stock price volatility in recent years.
−Removed: If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business.
+Added: Involvement in such litigation, could result in substantial costs and a diversion of management’s attention and resources, which could harm our business.
+Added: On August 4, 2020, a putative stockholder of Selecta filed a stockholder derivative action purportedly on behalf of Selecta and against certain current and former members of our board of directors, as well as one affiliated company owned by a current board member, in the Court of Chancery of the State of Delaware, namely Franchi v.
+Added: Barabe, et al.
+Added: The complaint alleges that the individual defendants breached their fiduciary duties and committed corporate waste when they authorized the private placement transaction, announced on December 19, 2019, at a price allegedly below fair value.
+Added: On September 25, 2020, the defendants filed a motion to dismiss.
+Added: On November 6, 2020, the plaintiff filed an amended complaint, and the defendants filed a second motion to dismiss on January 8, 2021.
+Added: On December 31, 2020, we received a stockholder litigation demand from other shareholders, relating to the same private placement transaction.
+Added: While we intend to vigorously defend against this demand, which we believe to be without merit, there can be no assurance as to the outcome of any stockholder litigation.
+Added: Unfavorable outcomes in securities class action litigation could require us to pay extensive damages, which could delay or prevent our ability to develop our product candidates and harm our operations.
Unresolved Staff Comments
Not applicable.
+Added: Our corporate headquarters are currently located at 65 Grove Street, Watertown, Massachusetts and consist of 25,078 total square feet of leased office and laboratory space under a lease that expires in May 2028.
+Added: We also lease approximately 2,500 square feet of office and laboratory space in Moscow, Russia on a month-to-month basis.
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.