What changed in this filing

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Item 1A. Risk Factors

2023-03-16 compared with 2022-03-31 · 330 added, 317 removed, 803 unchanged (45% of the section changed)

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Investment in biopharmaceutical product development is highly speculative because it entails substantial upfront capital expenditures and significant risk that a product candidate will fail to prove effective, gain regulatory approval or become commercially viable.

We do not have any products approved by regulatory authorities, have not generated any revenues to date, and have incurred significant research, development and other expenses related to our ongoing operations.

We do not have any products approved by regulatory authorities, have not generated any product revenues to date, and have incurred significant research, development and other expenses related to our ongoing operations.

As a result, we have not been profitable and have incurred significant operating losses in every reporting period since our inception.

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As of December 31, 2022 and 2021, we had an accumulated deficit of $179.9 million and $138.6 million, respectively.

We do not expect to generate revenues for many years, if at all.

We do not expect to generate product revenues for many years, if at all.

We expect to continue to incur significant expenses and operating losses for the foreseeable future.

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Our expenses will further increase as we:

• conduct additional clinical trials of our lead product, GPS, including the Phase 3 clinical trial evaluating GPS for AML;

• conduct additional clinical trials of our lead product, GPS, including the Phase 3 clinical trial evaluating GPS for AML, and our second clinical candidate, GFH009;

• hire additional personnel, including clinical, manufacturing, quality control, quality assurance and other scientific personnel, sales and marketing personnel and general and administrative personnel;

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• seek marketing approval for any product candidates that successfully complete clinical trials;

• develop our outsourced manufacturing and commercial activities and establish sales, marketing and distribution capabilities, if we receive, or expect to receive, marketing approval for any product candidates;

• seek marketing approval for any of our product candidates that successfully complete clinical trials;

• develop our outsourced manufacturing activities and establish sales, marketing and distribution capabilities, if we receive, or expect to receive, marketing approval for any product candidates;

• in-license or acquire the rights to, and pursue development of, other products, product candidates or technologies;

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• add operational, financial and management information systems and personnel.

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We currently have no source of revenues from product sales.

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• successfully complete development activities, including the necessary clinical trials;

• complete and submit BLAs to the FDA and obtain U.S.

• complete and submit BLAs and NDAs to the FDA and obtain U.S.

regulatory approval for indications for which there is a commercial market;

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Our revenues for any product candidate for which regulatory approval is obtained will be dependent, in part, upon the size of the markets in the territories for which it gains regulatory approval, the accepted price for the product, the ability to get reimbursement at any price, and whether we own the commercial rights for that territory.

If the number of our addressable disease patients is not as significant as our estimates, the indication approved by regulatory authorities is narrower than we expect, or the reasonably accepted population for treatment is narrowed by competition, physician choice or treatment guidelines, we may not generate significant revenues from sales of such products, even if approved.

If the number

of our addressable disease patients is not as significant as our estimates, the indication approved by regulatory authorities is narrower than we expect, or the reasonably accepted population for treatment is narrowed by competition, physician choice or treatment guidelines, we may not generate significant revenues from sales of such products, even if approved.

In addition, we anticipate incurring significant costs associated with commercializing any approved product candidate.

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If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and may be forced to reduce our operations.

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We will need additional financing to fund our operations and complete the development and, if approved, the commercialization of our product candidates.

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.

We expect to expend substantial resources for the foreseeable future to continue the clinical development and manufacturing of GPS, in particular the Phase 3 study of GPS in AML.

Our existing cash will not be sufficient to complete such development activities and obtain regulatory approval for GPS and, if we receive regulatory approval for GPS, commence commercialization activities, and we will need to raise significant additional capital to help us do so.

We expect to expend substantial resources for the foreseeable future to continue the clinical development and manufacturing of GPS, in particular the Phase 3 study of GPS in AML, and GFH009.

Our existing cash will not be sufficient to complete such development activities and obtain regulatory approval for our product candidates and, if we receive regulatory approval for our product candidates, commence commercialization activities, and we will need to raise significant additional capital to help us do so.

In addition, our operating plan may change as a result of factors currently unknown to us, and we may need additional funds sooner than planned.

If we are unable to obtain sufficient funding for our operations, we may be delayed in pursuing our development program for GPS.

If we are unable to obtain sufficient funding for our operations, we may be delayed in pursuing our development programs for GPS and GFH009.

Our future capital requirements depend on many factors, including:

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Additional funds may not be available when we need them on terms that are acceptable to us, or at all.

We have no committed source of additional capital.

Moreover, global events, such as the coronavirus pandemic and geopolitical unrest, have caused and will likely continue to cause uncertainty and volatility in the capital markets which could impact our ability to raise capital.

If adequate funds are not available to us on a timely basis, we may not be able to continue as a going concern or we may be required to delay, limit, reduce or terminate preclinical studies, clinical trials or other development activities for one or more of our product candidates or target indications, or delay, limit, reduce or terminate our establishment of sales and marketing capabilities or other activities that may be necessary to commercialize our product candidates.

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We have no committed source of additional capital other than our ATM facility.

Moreover, global and domestic events, such as public health crises, geopolitical unrest and domestic political events, have caused and could continue to cause uncertainty and volatility in the capital markets which could impact our ability to raise capital.

If adequate funds are not available to us on a timely basis, we may not be able to continue as a going concern or we may be required to

delay, limit, reduce or terminate preclinical studies, clinical trials or other development activities for one or more of our product candidates or target indications, or delay, limit, reduce or terminate our establishment of sales and marketing capabilities or other activities that may be necessary to commercialize our product candidates.

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

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Our consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

If we cannot continue as a viable entity, our securityholders may lose some or all of their investment in us.

If we cannot continue as a viable entity, our security holders may lose some or all of their investment in us.

Adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults or non-performance by financial institutions or transactional counterparties, could adversely affect our current and projected business operations and its financial condition and results of operations.

Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems.

For example, on March 10, 2023, Silicon Valley Bank, or SVB, was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation, or the FDIC, as receiver.

Similarly, on March 12, 2023,

Signature Bank and Silvergate Capital Corp.

were each swept into receivership.

Although a statement by the Department of the Treasury, the Federal Reserve and the FDIC stated that all depositors of SVB would have access to all of their money after only one business day of closure, including funds held in uninsured deposit accounts, borrowers under credit agreements, letters of credit and certain other financial instruments with SVB, Signature Bank or any other financial institution that is placed into receivership by the FDIC may be unable to access undrawn amounts thereunder.

If any of our counterparties to any such instruments that we may enter into in the future were to be placed into receivership, we may be unable to access such funds.

In addition, if any parties with whom we conduct business are unable to access funds pursuant to such instruments or lending arrangements with such a financial institution, such parties’ ability to pay their obligations to us or to enter into new commercial arrangements requiring additional payments to us could be adversely affected.

In this regard, counterparties to SVB credit agreements and arrangements, and third parties such as beneficiaries of letters of credit (among others), may experience direct impacts from the closure of SVB and uncertainty remains over liquidity concerns in the broader financial services industry.

Similar impacts have occurred in the past, such as during the 2008-2010 financial crisis.

Inflation and rapid increases in interest rates have led to a decline in the trading value of previously issued government securities with interest rates below current market interest rates.

Although the U.S.

Department of Treasury, FDIC and Federal Reserve Board have announced a program to provide up to $25 billion of loans to financial institutions secured by certain of such government securities held by financial institutions to mitigate the risk of potential losses on the sale of such instruments, widespread demands for customer withdrawals or other liquidity needs of financial institutions for immediately liquidity may exceed the capacity of such program.

There is no guarantee that the U.S.

Department of Treasury, FDIC and Federal Reserve Board will provide access to uninsured funds in the future in the event of the closure of other banks or financial institutions, or that they would do so in a timely fashion.

Although we assess our banking relationships as we believe necessary or appropriate, our access to funding sources and other credit arrangements in amounts adequate to finance or capitalize our current and projected future business operations could be significantly impaired by factors that affect us, the financial institutions with which we have arrangements directly, or the financial services industry or economy in general.

These factors could include, among others, events such as liquidity constraints or failures, the ability to perform obligations under various types of financial, credit or liquidity agreements or arrangements, disruptions or instability in the financial services industry or financial markets, or concerns or negative expectations about the prospects for companies in the financial services industry.

These factors could involve financial institutions or financial services industry companies with which we have financial or business relationships, but could also include factors involving financial markets or the financial services industry generally.

In addition, investor concerns regarding the U.S.

or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us to acquire financing on acceptable terms or at all.

Any decline in available funding or access to our cash and liquidity resources could, among other risks, adversely impact our ability to meet our operating expenses, financial obligations or fulfill our other obligations, result in breaches of our financial and/or contractual obligations or result in violations of federal or state wage and hour laws.

Any of these impacts, or any other impacts resulting from the factors described above or other related or similar factors not described above, could have material adverse impacts on our liquidity and our current and/or projected business operations and financial condition and results of operations.

In addition, any further deterioration in the macroeconomic economy or financial services industry could lead to losses or defaults by parties with whom we conduct business, which in turn, could have a material adverse effect on our current and/or projected business operations and results of operations and financial condition.

For example, a party with whom we conduct business may fail to make payments when due, default under their agreements with us, become insolvent or declare bankruptcy.

Any bankruptcy or insolvency, or the failure to make payments when due, of any counterparty of ours, or the loss of any significant relationships, could have material adverse impacts on our liquidity and our current and/or projected business operations and financial condition and results of operations.

Risks Related to the Development and Regulatory Approval of Our Product Candidates

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• receipt of regulatory approvals from applicable authorities;

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• obtaining and maintaining patent and trade secret protection and regulatory exclusivity for our product candidates;

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• obtaining regulatory approval from the FDA and other regulatory authorities, which have very limited experience with the development and commercialization of WT1 cancer immunotherapies;

• obtaining the components required for the administration of GPS (i.e., GPS, GM-CSF, and Montanide) from three separate sources, the subsequent separate storage requirements for each of these components and the delivery of these components to the administration location;

• obtaining the components required for the administration of GPS (i.e., GPS, GM-CSF, and Montanide) from three separate sources, the subsequent separate storage requirements for each of these components and the separate delivery of these components to the administration location;

• utilizing GPS in combination with other therapies, which may increase the risk of adverse side effects;

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• developing a manufacturing process used in connection with GPS that will yield a satisfactory product that is safe, effective, scalable and profitable;

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• establishing sales and marketing capabilities after obtaining any regulatory approval to gain market acceptance;

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Based on these and other factors, hospitals and payors may decide that the benefits of this new therapy do not or will not outweigh their costs.

The impact of Covid-19, as well as the limited number of patients who have the diseases for which our product candidates are being studied, has made it more difficult to enroll patients in our clinical trials, which could delay or prevent the start of clinical trials for our product candidates.

The limited number of patients who have the diseases for which our product candidates are being studied, has made it more difficult to enroll patients in our clinical trials, which could delay or prevent the start of clinical trials for our product candidates.

Identifying and qualifying patients to participate in clinical trials of our current and future product candidates is essential to our success.

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Many factors may affect our ability to identify, enroll and maintain qualified patients, including the following:

• disruptions caused by the global COVID-19 pandemic;

• shortages of personnel at our clinical sites;

• travel restrictions, lockdowns, and social distancing requirements as a result of COVID-19 which can adversely affect clinical site monitoring;

• eligibility criteria of our ongoing and planned clinical trials with specific characteristics appropriate for inclusion in our clinical trials;

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• issues with contract research organizations, or CROs, and/or with other vendors that handle our clinical trials.

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For example, we have observed that, at certain times and in certain instances, clinical site initiations and patient enrollment may have been delayed due to prioritization of hospital resources towards the COVID-19 pandemic and staff shortages at our clinical sites.

Clinicians and patients may not have been able to comply with clinical trial protocols if quarantines impeded patient movement or interrupted operations at sites.

Certain newly initiated sites have taken longer than expected to be fully operational.

Additionally, several countries in which we currently have or plan to have clinical sites continue to impose restrictions in response to the continued surge in coronavirus cases.

We believe that these factors have had and could continue to have an impact on the projected timelines for enrollment of patients in the REGAL study.

Moreover, the indication being studied in our Phase 3 clinical trial for GPS, i.e., patients with AML who have achieved CR2, is an orphan indication.

The indication being studied in our Phase 3 clinical trial for GPS, i.e., patients with AML who have achieved CR2, is an orphan indication.

In addition, only those CR2 patients who meet specific inclusion criteria are eligible to participate in the study.

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For example, with respect to GPS, a broadly similar anti-cancer peptide immunotherapeutic against melanoma-specific antigen being developed by GlaxoSmithKline for advanced unresectable melanoma initially produced positive efficacy data in a Phase 2 clinical study, but subsequently failed to prove more beneficial than placebo in a controlled, blinded and randomized Phase 3, registration-enabling clinical trial in the same indication in patients after tumor resection.

Despite the results reported in earlier preclinical studies or clinical trials for our product candidates, we do not know whether the clinical trials we may conduct will demonstrate adequate efficacy and safety to result in regulatory approval to market GPS or any of our product candidates for a particular indication, either as a monotherapy or in combination, in any particular jurisdiction.

Despite the results reported in earlier preclinical studies or clinical trials for our product candidates, we do not know whether the clinical trials we may conduct will demonstrate adequate efficacy and safety to result in regulatory approval to market any of our product candidates for a particular indication, either as a monotherapy or in combination, in any particular jurisdiction.

Efficacy data from prospectively designed trials may differ significantly from those obtained from retrospective subgroup analyses.

If later-stage clinical trials do not produce favorable results, our ability to achieve regulatory approval for GPS may be adversely impacted.

If later-stage clinical trials do not produce favorable

results, our ability to achieve regulatory approval for our product candidates may be adversely impacted.

Even if we believe that we have adequate data to support an application for regulatory approval to market any of our current or future product candidates, the FDA or other regulatory authorities may not agree and may require that we conduct additional clinical trials.

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Interim, topline 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 publicly disclose preliminary, interim or topline data from our clinical trials.

These interim updates are based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to a particular study or trial.

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 evaluate all data.

As a result, the topline results or preliminary data that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated.

Topline data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published.

As a result, topline data should be viewed with caution until the final data are available.

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

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

Adverse changes between interim data and final data could adversely affect our business and prospects and could result in volatility in the price of our common stock.

We may develop our programs in combination with other therapies, which exposes us to additional risks.

We may develop our clinical candidates in combination with one or more currently approved cancer therapies or therapies currently in clinical development.

Patients may not be able to tolerate our product candidates in combination with other therapies or dosing of our product candidates in combination with other therapies may have unexpected consequences.

Even if any of our product candidates were to receive marketing approval or be commercialized for use in combination with other existing therapies, we would continue to be subject to the risks that the FDA, EMA or other comparable foreign regulatory authorities could revoke approval of the therapy used in combination with any of our product candidates, or safely, efficacy, manufacturing or supply issues could arise with these existing therapies.

In addition, it is possible that existing therapies with which our product candidates are approved for use could themselves fall out of favor or be relegated to later lines of treatment.

This could result in the need to identify other combination therapies for our product candidates or our own products being less successful commercially.

We may also evaluate our product candidates in combination with one or more other cancer therapies that have not yet been approved for marketing by the FDA, EMA or comparable foreign regulatory authorities.

If the FDA, EMA or other comparable foreign regulatory authorities do not approve or revoke their approval of these other therapies, or if safety, efficacy, commercial adoption, manufacturing or supply issues arise with the therapies we choose to evaluate in combination with our product candidates, we may be unable to obtain approval of or successfully market our product candidates.

Additionally, if the third-party providers of therapies or therapies in development used in combination with our product candidates are unable to produce sufficient quantities for clinical trials or commercialization of our product candidates, or if the cost of combination therapies are prohibitive, our development and commercialization efforts would be impaired, which would have an adverse impact on our business, financial condition, results of operations and growth prospects.

Clinical drug development involves a lengthy and expensive process with an uncertain outcome.

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Failure can occur at any time during the clinical trial process.

Before obtaining approval from regulatory authorities for the sale of any product candidate, we must conduct extensive clinical trials to demonstrate the safety and efficacy of our product candidates in humans.

Before obtaining approval from regulatory authorities for the sale of any product candidate, we must conduct extensive clinical trials to demonstrate the safety and efficacy of

our product candidates in humans.

Prior to initiating clinical trials, a sponsor must complete extensive preclinical testing of a product candidate, including, in most cases, preclinical efficacy experiments as well IND-enabling toxicology studies.

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In particular, clinical trials of our product candidates may produce inconclusive or negative results.

We have limited data regarding the safety, tolerability and efficacy of GPS administered as monotherapy or in combination with PD-1 inhibitors.

We have limited data regarding the safety, tolerability and efficacy of GPS administered as monotherapy or in combination with PD-1 inhibitors or for GFH009 as monotherapy and no safety, tolerability or efficacy data for GFH009 administered in combination with other therapeutics, such as venetoclax.

For a further discussion of the safety risks in our trials, see the risk factor herein entitled "Our current and future product candidates, the methods used to deliver them or their dosage levels 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 any regulatory approval."

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• inability to identify and maintain a sufficient number of trial sites, many of which may already be engaged in other clinical trial programs, including some that may be for the same indication;

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• failure of our third-party clinical trial managers, CROs, clinical trial sites, contracted laboratories or other third-party vendors to satisfy their contractual duties, meet expected deadlines or return trustworthy data;

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Risks associated with operating in foreign countries could materially adversely affect our product development.

We are conducting future studies in countries outside of the United States.

For certain of our clinical trials, we have clinical sites in countries outside of the United States.

Consequently, we may be subject to risks related to operating in foreign countries.

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economic weakness, including inflation, or political instability in particular foreign economies and markets;

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

compliance with tax,

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

foreign taxes, including withholding of payroll taxes;

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• differing payor reimbursement regimes, governmental payors or patient self-pay systems and price controls;

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• continued uncertainties related to the withdrawal of the United Kingdom from the European Union (known as "Brexit") and its financial, trade, regulatory and legal implications, which could lead to legal uncertainty and potentially divergent national laws and regulations as the United Kingdom determines which EU laws to replace or replicate, and which may further create global economic uncertainty, which could materially adversely affect our business, business opportunities, results of operations, financial condition, and cash flows;

• the COVID-19 pandemic, which has resulted in global travel restrictions;

• production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad, including those that may result from the recent coronavirus outbreak;

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Global, market and economic conditions may negatively impact our business, financial condition and share price.

We face several risks associated with international business and are subject to global events beyond our control, including war, public health crises, such as pandemics and epidemics, trade disputes, economic sanctions, trade wars and their collateral impacts and other international events.

We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing armed military conflict between Russia and Ukraine.

Our business, financial condition and results of operations may be materially adversely affected by any negative impact on the global economy and capital markets resulting from the conflict in Ukraine or any other geopolitical tensions.

The U.S., United Kingdom and EU governments, among others, have instituted various sanctions and export-control measures in response to the invasion, including comprehensive financial sanctions, targeted at Russia or designated individuals and entities with business interests and/or government connections to Russia or those involved in Russian military activities.

Governments have also enhanced export controls and trade sanctions targeting Russia’s imports of goods.

The United States and other countries could impose wider sanctions and take other actions should the conflict further escalate.

It is not possible to predict the broader consequences of this conflict, which could include further sanctions, embargoes, regional instability, geopolitical shifts and adverse effects on macroeconomic conditions, currency exchange rates and financial markets, all of which could impact our business, financial condition and results of operations and our ability to raise capital.

The results of our operations could be adversely affected by general conditions in the global economy, the global financial markets and the global political conditions.

The United States and global economies are facing growing inflation, higher interest rates and a potential recession.

Furthermore, a severe or prolonged economic downturn, including a recession or depression resulting from the ongoing COVID-19 pandemic or political disruption such as the war between Ukraine and Russia could result in a variety of risks to our business, including weakened demand for our programs and development candidates, if approved, relationships with any vendors or business partners located in affected geographies and our ability to raise additional capital when needed on acceptable terms, if at all.

A weak or declining economy or political disruption, including any international trade disputes, could also strain our manufacturers or suppliers, possibly resulting in supply disruption, or cause our customers to delay making payments for our potential products.

Any of the foregoing could seriously harm our business, and we cannot anticipate all of the ways in which the political or economic climate and financial market conditions could seriously harm our business.

Although we do not currently have any clinical study sites in Russia or Ukraine, economic, political and social conditions resulting from Russia’s invasion of Ukraine could materially disrupt our clinical trials, increase our costs and may disrupt planned clinical development activities.

For example, we are currently in the process of activating clinical sites for our REGAL study in Poland, a country that borders Ukraine and is being impacted by an influx of Ukrainian refugees resulting from Russia’s invasion of Ukraine.

For example, we currently have clinical sites for our REGAL study in Poland, a country that borders Ukraine and has been impacted by an influx of Ukrainian refugees resulting from Russia’s invasion of Ukraine.

Furthermore, we rely on suppliers in the EU.

To the extent the conflict between Ukraine and Russia adversely impacts the ability of our suppliers to distribute the supplies we need for our clinical trials, or such distribution cannot be done on a timely basis, the timing for completing our clinical trials may be adversely impacted.

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Our current and future product candidates, the methods used to deliver them or their dosage levels 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 any regulatory approval.

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an independent DSMB that is governing our clinical trials;

or an IRB, that approves and, monitors biomedical research to protect the rights and welfare of human subjects.

or an IRB, that approves and,

monitors biomedical research to protect the rights and welfare of human subjects.

For example, although no high-grade delayed type hypersensitivity in the skin or systemic anaphylaxis events have been noted after GPS administration in patients treated in our clinical studies to date, it is theoretically possible that such toxicities, or other type of adverse events, may occur in future clinical studies.

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• we may be required to conduct post-marketing studies;

• we may be required to change or the healthcare setting in which the way the product is administered;

• we may be required to change or the health care setting in which the way the product is administered;

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

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Any of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved.

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Our product development program may not uncover all possible adverse events that patients who take our product candidates may experience.

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Similarly, we cannot commercialize product candidates outside of the United States without obtaining regulatory approval from comparable foreign regulatory authorities.

Before obtaining regulatory approvals for the commercial sale of any product candidate for a target indication, we must demonstrate with substantial evidence gathered in preclinical studies and clinical trials, generally including well-controlled Phase 3 trials, that the product candidate is safe and effective for use for that target indication and that the manufacturing facilities, processes and controls are adequate with respect to such product candidate.

Before obtaining

regulatory approvals for the commercial sale of any product candidate for a target indication, we must demonstrate with substantial evidence gathered in preclinical studies and clinical trials, generally including well-controlled Phase 3 trials, that the product candidate is safe and effective for use for that target indication and that the manufacturing facilities, processes and controls are adequate with respect to such product candidate.

The time required to obtain approval by the FDA and comparable foreign regulatory authorities is unpredictable but typically takes many years following the commencement of preclinical studies and clinical trials and depends upon numerous factors, including the substantial discretion and available resources of the regulatory authorities.

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Also, any regulatory approval of our current or future product candidates, once obtained, may be withdrawn.

Our current and future product candidates could fail to receive regulatory approval from the FDA.

Our current and future product candidates could fail to receive regulatory approval from the FDA or comparable foreign regulatory authorities.

We have not obtained regulatory approval for any product candidate and it is possible that our existing product candidates or any future product candidates will not obtain regulatory approval, for many reasons, including:

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• the insufficiency of data collected from clinical trials of our product candidates to support the submission and filing of a BLA, NDA or other submission or to obtain regulatory approval;

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• the insufficiency of a single Phase 3 clinical trial of GPS in AML for regulatory approval in that indication;

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If we are unable to obtain regulatory approval for one of our product candidates in one or more jurisdictions, or any approval contains significant limitations, we may not be able to obtain sufficient funding to continue the development of that product or generate revenues attributable to that product candidate.

We currently have Orphan Drug Product designation for certain product candidates, and may seek Orphan Drug Product designation for additional product candidates or indications, which might not be received or provide the intended benefit thereof.

We currently have Orphan Drug Product designation for GPS for certain indications, and may seek Orphan Drug Product designation for additional product candidates, including GFH009, or indications, which might not be received or provide the intended benefit thereof.

Regulatory authorities in some jurisdictions, including the United States and Europe, may designate drugs for relatively small patient populations as Orphan Drug Products.

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In addition, Orphan Drug Product exclusivity may be lost if the FDA or EMA determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the rare disease or condition.

We currently have Fast Track designation for certain product candidates and may seek Fast Track designation for additional product candidates or indications, which might not be received or provide the intended benefits thereof.

We currently have Fast Track designation for GPS and may seek Fast Track designation for additional product candidates, including GFH009, or indications, which might not be received or provide the intended benefits thereof.

If a product candidate is intended for the treatment of a serious condition and nonclinical or clinical data demonstrate the potential to address unmet medical need for this condition, a product sponsor may apply to the FDA for Fast Track designation, which may or may not be granted by the FDA.

The FDA has given us Fast Track designation for GPS in AML, MPM and MM and for NPS for the adjuvant treatment of patients with early stage breast cancer with low to intermediate HER2 expression following standard of care upfront therapy (surgery plus chemotherapy +/- radiotherapy).

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We have received Fast Track designation from the FDA for GPS in AML, MPM and MM.

However, Fast Track designation does not ensure that we will receive marketing approval or that approval will be granted within any particular timeframe.

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Clinical trials accepted in one country may not be accepted by regulatory authorities in other countries.

In addition, many countries outside the United States require that a product be approved for reimbursement before it can be approved for sale in that country.

In addition, many countries outside the United States

require that a product be approved for reimbursement before it can be approved for sale in that country.

A product candidate that has been approved for sale in a particular country may not receive reimbursement approval in that country, or may receive reimbursement at a level that is not commercially viable.

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

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In addition, manufacturers and manufacturers’ facilities are required to continuously comply with FDA and comparable foreign regulatory authority requirements, including ensuring quality control and manufacturing procedures conform to cGMP, regulations and corresponding foreign regulatory manufacturing requirements.

Accordingly, we and our contract manufacturers will be subject to continual review and inspections to assess compliance with cGMP and adherence to commitments made in any BLA submission to the FDA or any other type of domestic or foreign marketing authorization application.

Accordingly, we and our contract manufacturers will be subject to continual review and inspections to assess compliance with cGMP and adherence to commitments made in any BLA or NDA submission to the FDA or any other type of domestic or foreign marketing authorization application.

We or our third-party manufacturers may not be able to comply with cGMP regulations or similar regulatory requirements outside of the United States.

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• issue Form 483 notices of observations, warning letters or untitled letters;

• mandate modifications to promotional materials or require us to provide corrective information to healthcare practitioners;

• mandate modifications to promotional materials or require us to provide corrective information to health care practitioners;

• require us to enter into a consent decree, which can include imposition of various fines, reimbursements for inspection costs, required due dates for specific actions and penalties for noncompliance;

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Any actual or alleged failure to comply with labeling and promotion requirements may have a negative impact on our business.

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Risks Related to Our Manufacturing

We have limited to no manufacturing or distribution capability and must rely upon third parties for such.

We currently have agreements with various third-party manufacturing facilities for production of our product candidates for research and development and testing purposes.

We currently have direct or indirect agreements or arrangements with various third-party manufacturing facilities for production of our product candidates for research and development and testing purposes.

For example, for GFH009 we are party to a supply agreement with GenFleet who has agreements with third-party manufacturers for the manufacture of GFH009.

We depend on these manufacturers to meet our deadlines, quality standards and specifications.

Reliance on third-party providers may expose us to more risk than if we were to manufacture our product candidates ourselves.

We do not control the manufacturing processes of the CMOs we contract with and are dependent on those third parties for the production of our product candidates in accordance with relevant applicable regulations, such as cGMP, which includes, among other things, quality control, quality assurance and the maintenance of records and documentation.

We do not control the manufacturing processes of the CMOs we rely on and are dependent on those third parties for the production of our product candidates in accordance with relevant applicable regulations, such as cGMP, which includes, among other things, quality control, quality assurance and the maintenance of records and documentation.

Our reliance on third parties for the manufacture of our active pharmaceutical ingredient and drug product and, in the future, any approved products, creates a dependency that could severely disrupt our research and development, our clinical testing, and ultimately our sales and marketing efforts if the source of such supply proves to be unreliable or unavailable.

If the contracted manufacturing source is unreliable or unavailable, we may not be able to manufacture clinical drug supplies of our product candidates, and our preclinical and clinical testing programs may not be able to move forward and our entire business plan could fail.

Our third-party manufacturers are subject to inspection and approval by regulatory authorities before we can commence the manufacture and sale of any of our product candidates, and thereafter are subject to ongoing inspection from time to time.

The third-party manufacturers we rely on for manufacture of our product candidates are subject to inspection and approval by regulatory authorities before we can commence the manufacture and sale of any of our product candidates, and thereafter are subject to ongoing inspection from time to time.

Our third-party manufacturers may not be able to comply with cGMP regulations or similar regulatory requirements outside of the United States.

In complying with the manufacturing regulations of the FDA and other comparable foreign regulatory authorities, we and our third-party suppliers must spend significant time, money and effort in the areas of design and development, testing, production, record-keeping and quality control to assure that the products meet applicable specifications and other regulatory requirements.

If either we or our CMOs fail to comply with these requirements, our ability to develop and commercialize our product candidates could suffer significant interruptions, and we may be subject to regulatory enforcement action, including the seizure of products and shutting down of production.

If either we or the CMOs we rely on fail to comply with these requirements, our

ability to develop and commercialize our product candidates could suffer significant interruptions, and we may be subject to regulatory enforcement action, including the seizure of products and shutting down of production.

Both the active pharmaceutical ingredient and drug product for our product candidates are currently single sourced.

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We are subject to a multitude of manufacturing risks, any of which could substantially increase our costs and limit supply of our product candidates.

We and our CMOs will need to conduct significant development work for each product candidate for each target indication for studies, trials and commercial launch readiness.

We and the CMOs we rely on will need to conduct significant development work for each product candidate for each target indication for studies, trials and commercial launch readiness.

We intend to improve the existing processes for GPS in connection with more advanced clinical trials or commercialization efforts we may undertake in the future.

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Moreover, current clinical supplies may not be adequate for future clinical studies.

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Additionally, the process of manufacturing our product candidates is complex, highly regulated and subject to several risks, including but not limited to:

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We may also have to write off inventory, incur other charges and expenses for supply of drug product that fails to meet specifications, undertake costly remediation efforts, or seek more costly manufacturing alternatives.

Inability to meet the demand for our product candidates could damage our reputation and the reputation of our products among physicians, healthcare payors, patients or the medical community, and cancer treatment centers, which could adversely affect our ability to operate our business and our results of operations.

In the clinical trials using GPS and NPS, GM-CSF is also administered and its availability is dependent upon a third-party manufacturer, which may or may not reliably provide GM-CSF, thus jeopardizing the completion of the trials.

Both GPS and NPS are administered in combination with GM-CSF, which is available in both liquid and lyophilized forms exclusively from one manufacturer.

We will continue to be dependent on that manufacturer for our supply of GM-CSF in connection with the ongoing GPS and NPS trials and the potential commercial manufacture of these programs.

Inability to meet the demand for our product candidates could damage our reputation and the reputation of our products among physicians, health care payors, patients or the medical community, and cancer treatment centers, which could adversely affect our ability to operate our business and our results of operations.

In the clinical trials using GPS, GM-CSF, and Montanide are also administered and their availability is dependent upon third-party manufacturers, which may or may not reliably provide GM-CSF or Montanide, thus jeopardizing the completion of the trials.

GPS is administered in combination with GM-CSF, which is available in both liquid and lyophilized forms exclusively from one manufacturer.

We will continue to be dependent on that manufacturer for our supply of GM-CSF in connection with the ongoing GPS trials and the potential commercial manufacture of GPS.

We have not entered into a dedicated supply agreement with the manufacturer for GM-CSF, and instead rely on purchase orders to meet our supply needs.

Any temporary interruptions or discontinuation of the availability of GM-CSF, or any determination by us to change the GM-CSF used with GPS or NPS, could have a material adverse effect on our clinical trials and any commercialization of the assets.

Any temporary interruptions or discontinuation of the availability of GM-CSF, or any determination by us to change the GM-CSF used with GPS, could have a material adverse effect on our clinical trials and any commercialization of the assets.

Similarly, for GPS, Montanide is also administered in combination with GM-CSF and GPS.

Any temporary interruptions or discontinuation of the availability of Montanide could have a material adverse effect on our clinical trials for GPS and any commercialization of the asset.

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If any of our CMOs’ clinical manufacturing facilities are damaged or destroyed or production at such facilities is otherwise interrupted, our business and prospects would be negatively affected.

If our CMOs’ manufacturing facilities or the equipment in them is damaged or destroyed, we may not be able, quickly or inexpensively, to replace our manufacturing capacity or replace it at all.

In the event of a temporary or protracted loss of this facility or equipment, we might not be able to transfer manufacturing to another CMO.

If any of the clinical manufacturing facilities of CMOs we rely on for clinical supply are damaged or destroyed or production at such facilities is otherwise interrupted, our business and prospects would be negatively affected.

If the manufacturing facilities of the CMOs we rely on for clinical supply or the equipment in them is damaged or destroyed, we may not be able, quickly or inexpensively, to replace such manufacturing capacity or replace it at all.

In the event of a temporary or protracted loss of a facility or equipment, we might not be able to transfer manufacturing to another CMO.

Even if we could transfer manufacturing to another CMO, the shift would likely be expensive and time-consuming, particularly because the new facility would need to comply with the necessary regulatory requirements, and we would need FDA approval before selling any products manufactured at that facility.

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We currently rely on and plan to continue to rely on a CRO for our Phase 3 trial for GPS in AML and well as all of our ongoing and contemplated clinical studies, with services to be rendered by such CROs and vendors ranging from specific and need-tailored ( e.g.

, data management and biostatistics) only to, in the case of our Phase 3 trial for GPS in AML, all-encompassing.

, data management and biostatistics) only to, in the case of our Phase 3 trial for GPS in AML, all-

encompassing.

We rely on these parties for the execution of our preclinical studies and clinical trials, including the proper and timely conduct of our clinical trials, and we control only some aspects of their activities.

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Failure to comply also would violate federal requirements in the United States and could result in other penalties, which would delay the regulatory approval process and result in adverse publicity.

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Our CROs, third-party vendors and contractors are not our employees, and except for remedies available to us under our agreements with such CROs, third-party vendors and contractors, we cannot control whether or not they devote sufficient time and resources, including experienced staff, to our ongoing clinical, nonclinical and preclinical programs.

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In addition, there is a natural transition period when a new CRO, third-party vendor or contractor commences work and the new CRO, third-party vendor or contractor may not provide the same type or level of services as the original provider.

We are dependent on technologies we license, and if we lose the right to license such technologies or we fail to license new technologies in the future, our ability to develop new products would be harmed, and if we fail to meet our obligations under our license agreements, we may lose the ability to develop our product candidates.

We currently are dependent on licenses from third parties for technologies relating to our product candidates.

Our current licenses impose, and any future licenses we enter into are likely to impose, various development, funding, royalty, diligence, sublicensing, insurance and other obligations on us.

If our license with respect to any of these technologies is terminated for any reason, the development of the products contemplated by the licenses would be delayed, or suspended altogether, while we seek to license similar technology or develop new non-infringing technology.

The costs of obtaining new licenses are high.

For example, we are entirely dependent on our license from MSK to allow us to develop and commercialize our lead product candidate, GPS, and any loss of or challenge to our license agreement with MSK could have a material and adverse effect on our business and result of operations.

In addition, our business depends on our ability to license therapeutic compounds from third parties.

If we fail to meet our obligations under our license agreements, we may lose the ability to develop our product candidates, which would adversely affect our business.

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We have in-licensed a significant portion of our intellectual property from MSK.

If we breach our license agreement with MSK, we could lose the ability to continue the development and potential commercialization of GPS.

GPS is licensed-in from MSK and includes an exclusive license to United States and foreign patent applications.

GPS is in-licensed from MSK and includes an exclusive license to U.S.

and foreign patent applications.

Under the MSK license agreement, we are subject to various obligations, including diligence obligations with respect to funding, development and commercialization activities, payment obligations upon achievement of certain milestones and royalties on product sales, as well as other material obligations.

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The loss of our license agreement with MSK could materially adversely affect our ability to proceed to utilize the affected intellectual property in our development efforts, our ability to enter into future collaboration, licensing and/or marketing agreements for GPS and our ability to commercialize GPS.

We rely on a license agreement with GenFleet for the development of GFH009, and if this license is breached or otherwise terminated, we could lose the ability to continue the development and potential commercialization of GFH009.

We have entered into a license agreement with GenFleet under which we have an exclusive license to develop and commercialize GFH009 worldwide, other than in mainland China, Hong Kong, Macau and Taiwan.

Under the license agreement, we are subject to various obligations, including diligence obligations with respect to development and commercialization activities, payment obligations upon achievement of certain milestones, and royalties on annual net sales (if the product candidate is ultimately commercialized), as well as other material obligations.

If there is any conflict, dispute, disagreement, or issue of nonperformance between us and GenFleet regarding our rights or obligations under the license agreement, including any such conflict, dispute, or disagreement arising from our failure to satisfy diligence or payment obligations under the license agreement, we may be liable to pay damages and GenFleet may have a right to terminate the license.

The loss of the license agreement could prevent us from developing, commercializing, or entering into future strategic transactions relating to GFH009.

The risks described elsewhere pertaining to our patents and other intellectual property rights also apply to the intellectual property rights that we license, and any failure by us or our licensors to obtain, maintain and enforce these rights could have a material adverse effect on our business.

To date, we have not been able to identify any suitable acquiror, licensing or collaboration partner for NPS to enter into a transaction with such acquiror or partner on favorable terms, and we may not be able to find such a suitable acquiror or partner in the future, which will impair our ability to derive value from the NPS asset.

We have determined that we will not engage in further development of NPS.

As a result of such determination, the primary path available to derive value from the NPS asset is to find a suitable acquiror, licensing or collaboration partner for the asset.

We currently have no agreements or commitments to engage in any specific transactions, and our exploration of various strategic alternatives has not resulted in any specific action or transaction.

There can be no assurance that we will enter into any transaction as a result of this effort or that a transaction will be able to be consummated upon favorable terms, including up-front, milestone, royalty and/or license payments as a result of numerous factors, many of which are outside of our control.

Furthermore, if we enter into a transaction relating to NPS, our business objectives may change depending upon the nature of the transaction.

We cannot predict the impact that such transaction might have on our stock price.

We also cannot predict the impact on our stock price if we fail to enter into such a transaction.

If we do enter into a transaction to out-license NPS, there is no assurance that the licensee will be successful in the development and commercialization of the asset as any potential licensee would be subject to many of the same risks associated with clinical development set forth in this “Risk Factors” section.

In addition, our business depends on our ability to license additional therapeutic compounds from third parties.

If we fail to meet our obligations under our current license agreements, we may lose the ability to enter into licenses for the development of additional product candidates in the future, which would adversely affect our business.

We may not realize the benefits of our strategic alliances that we may form in the future.

We may form strategic alliances, create joint ventures or collaborations or enter into licensing arrangements with third parties that we believe will complement or augment our existing business, such as our License Agreement with 3D Medicines.

These relationships, or those like them, may require us to incur nonrecurring and other charges, increase our near- and long-term expenditures, issue securities that dilute our existing stockholders or disrupt our management and business.

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Any delays in entering into new strategic alliances or license agreements related to our product candidates could also delay the development and commercialization of our product candidates and reduce their competitiveness even if they reach the market.

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Our business involves the use of hazardous materials and we and our third-party manufacturers and suppliers must comply with environmental, health and safety laws and regulations, which can be expensive and restrict how we do business.

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We expect to depend on collaborators, partners, licensees, clinical research organizations and other third parties to support our discovery efforts, to formulate product candidates, to manufacture our product candidates, to conduct clinical trials for some or all of our product candidates and to commercialize our product candidates if approved.

For example, in December 2020 we entered into an Exclusive License Agreement with 3D Medicines pursuant to which we granted commercialization rights in the Greater China Territory to 3D Medicines.

For example, in December 2020 we entered into an Exclusive License Agreement with 3D Medicines pursuant to which we granted commercialization rights in Greater China to 3D Medicines.

We cannot guarantee that we will be able to successfully negotiate agreements for or maintain relationships with collaborators, partners, licensees, clinical investigators, vendors and other third parties on favorable terms, if at all.

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Any assertion by third parties that our activities or product candidates infringe upon the intellectual property rights of third parties may adversely affect our ability to secure strategic partners or licensees for our technology or product candidates or our ability to secure or maintain manufacturers for our compounds.

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Risks Related to Our Intellectual Property

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We seek to protect our proprietary position by filing in the United States and in certain foreign jurisdictions patent applications related to our novel technologies and product candidates that are important to our business.

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 or in a timely manner.

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 or in a timely manner.

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

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Moreover, changes in either the patent laws or interpretation of the patent laws in the United States or other countries may diminish the value of our or a collaboration or commercialization partner’s patents or narrow the scope of our or their patent protection.

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Changes in either the patent laws or in the interpretations of patent laws in the United States or abroad may diminish the value of our intellectual property.

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Litigation or other proceedings to enforce or defend intellectual property rights is very complex, expensive, and may divert our management’s attention from our core business and may result in unfavorable results that could adversely affect our ability to prevent third parties from competing with us.

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If another party has reason to assert a substantial new question of patentability against any of our claims in our own and in-licensed patents, the third party can request that the patent claims be reexamined, which may result in a loss of scope of some claims or a loss of the entire patent.

In addition to potential infringement suits, and interference and reexamination proceedings, we may become a party to patent opposition proceedings where either the patentability of the inventions subject of our patents are challenged, or we are challenging the patents of others.

In addition to potential infringement suits, and interference and reexamination proceedings, we may become a party to inter partes and post-grant review proceedings in the United States and patent opposition proceedings outside the United States, where either the patentability of our patents is challenged, or we are challenging the patents of others.

The costs of these proceedings could be substantial, and it is possible that such efforts would be unsuccessful.

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In addition, during litigation, the patent holder could obtain a preliminary injunction or other equitable relief, which could prohibit us from making, using or selling our commercial product and product candidates pending a trial on the merits, which could be years away.

Our product candidates may face biosimilar competition sooner than expected after the expiration of our composition of matter patent protection for such products.

Even if we are successful in achieving regulatory approval to commercialize a product candidate ahead of our competitors, our product candidates may face competition from biosimilar products.

GFH009 may face generic competition sooner than expected before the expiration of our composition of matter patent protection .

Even if we are successful in achieving regulatory approval to commercialize GFH009, our product candidate may face generic competition.

Because GFH009 has not been previously approved as an active ingredient, we expect the Hatch-Waxman Act to provide a five-year period of new chemical entity, or NCE, exclusivity following its approval during which time generic competitors cannot file an Abbreviated New Drug Application, or ANDA, for a generic version of GFH009, unless the submission contains a Paragraph IV Certification that one or more patents

listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (commonly known as the Orange Book) for GFH009 are invalid, unenforceable or will not be infringed by a proposed ANDA product, in which case the submission may be made four years following the original drug approval.

If a Paragraph IV Certification is made, the generic company is required to provide a Paragraph IV Notice Letter advising of the certification.

If that occurs, we will have the opportunity to bring a patent infringement action against the generic company.

If such a suit is filed within the 45-day period following receipt of the Paragraph IV Notice Letter, the Hatch-Waxman Act provides for a 30-month stay on FDA’s ability to grant final approval of the proposed generic product.

The 30-month stay generally runs from the date the Paragraph IV Notice Letter is received.

However, when a Paragraph IV certification is received during the five-year period of NCE exclusivity following the date of first NDA approval, the thirty-month stay extends from five years after the date that product was first approved.

The 30-month stay may be shortened or lengthened, including due to a settlement of a lawsuit, a court order (including a decision by the district court on the merits of the case), or patent expiration.

The party filing the ANDA may also counterclaim in the litigation that one or more of our patents are invalid, unenforceable, and/or not infringed.

If all of the asserted GFH009 patents were found invalid, enforceable, and/or not infringed, a competing generic product could be marketed prior to expiration of those patents, our business could be harmed.

If the FDA, EMA or other foreign regulatory authorities approve generic or biosimilar versions of any of our product candidates that receive marketing approval, or such authorities do not grant our products appropriate periods of exclusivity before approving generic or biosimilar versions of those products, the sales of our products, if approved, could be adversely affected.

Even if we are successful in achieving regulatory approval to commercialize a biologic product candidate ahead of our competitors, our product candidates may face competition from biosimilar and generic products.

Most biological products are licensed for marketing by FDA via a BLA, under authorities in the Public Health Service Act, or PHSA.

Assuming that we receive positive data from the REGAL trial, we will file a BLA in order to obtain marketing authorization for GPS.

To obtain licensure or marketing approval for a new biologic, the sponsor (generally, the manufacturer) must demonstrate in the BLA that the biological product, and that the facility in which it is manufactured, processed, packed, or held, meets standards to assure that the product is safe, pure, and potent.

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During the 12-year exclusivity period, approval of an abbreviated BLA for a biosimilar referencing the protected brand-name biologic may not be made effective, which means FDA may not approve the biosimilar application until 12 years after the date on which the reference product was first licensed.

In addition, the BPCIA provides for a process for disclosure and negotiation between the biosimilar applicant and reference product sponsor, sometimes referred to as the “patent dance”.

Although not mandatory on the party of the biosimilar applicant, the dance involves several rounds of informational exchanges concerning potential disputes over the biosimilar applicant’s infringement of the reference product sponsor’s patents.

In addition, the BPCIA provides for a process for disclosure and negotiation between the biosimilar applicant and reference product sponsor, sometimes referred to as the “patent dance.” Although not mandatory on the party of the biosimilar applicant, the dance involves several rounds of informational exchanges concerning potential disputes over the biosimilar applicant’s infringement of the reference product sponsor’s patents.

Also, biosimilar licensure under the BPCIA is not contingent upon resolution of patent disputes.

Therefore, the FDA may approve a biosimilar despite unresolved patent issues between the reference product sponsor and the biosimilar applicant.

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Some of our composition of matter patents for certain of our product candidates have expired or will expire prior to any product marketing approval.

We intend to seek data exclusivity and market exclusivity for GPS, which we expect to be regulated by the FDA as a biological product, provided under the PHSA, and similar laws in other countries.

We believe that GPS and NPS will qualify for four years of data exclusivity and 12 years of market exclusivity under the BPCIA.

We believe that GPS will qualify for four years of data exclusivity and 12 years of market exclusivity under the BPCIA.

The law is complex and continues to be interpreted and implemented by the FDA.

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There is also a risk that the U.S.

Congress could amend the BPCIA to shorten the 12-year market exclusivity period or that the FDA will not consider our product candidates to be reference biological products pursuant to its interpretation of the exclusivity provisions of the BPCIA for competing products, potentially creating the opportunity for biosimilar competition sooner than anticipated after the expiration of our patent protection.

could amend the BPCIA to shorten the 12-year market exclusivity period or that the FDA will not consider our product candidates to be reference biological products pursuant to its interpretation of the exclusivity provisions of the BPCIA for competing products, potentially creating the opportunity for biosimilar competition sooner than anticipated after the expiration of our patent protection.

Moreover, the extent to which a biosimilar, once approved, will be substituted for any reference product in a way that is similar to traditional generic substitution for non-biological products is not yet clear, and will depend on a number of marketplace and regulatory factors that are still developing.

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However, as with all prescribing decisions made in the context of a patient-provider relationship and a patient’s specific medical needs, health care providers are not restricted from prescribing biosimilar products in an off-label manner.

Even if, as we expect, GPS and NPS are considered to be reference products eligible for 12 years of exclusivity under the BPCIA, a competitor could decide to forego the abbreviated approval pathway available for biosimilar products and to submit a full BLA for product licensure after completing its own preclinical studies and clinical trials.

Even if, as we expect, GPS is considered to be reference products eligible for 12 years of exclusivity under the BPCIA, a competitor could decide to forego the abbreviated approval pathway available for biosimilar products and to submit a full BLA for product licensure after completing its own preclinical studies and clinical trials.

In such a situation, any exclusivity to which we may be eligible under the BPCIA would not prevent the competitor from marketing its biological product as soon as it is approved.

If we receive positive data from an adequate and well-controlled trial for GFH-009, we will file an NDA in order to receive marketing authorization for GFH009.

Once an NDA is approved, the product covered thereby becomes a “reference listed drug” in the FDA’s Orange Book.

In the United States, manufacturers may seek approval of generic versions of reference listed drugs through submission of an ANDA.

In support of an ANDA, a generic manufacturer need not conduct clinical trials to assess safety and efficacy.

Rather, the applicant generally must show that its product has the same active ingredient(s), dosage form, strength, route of administration and conditions of use or labelling as the reference listed drug and that the generic version is bioequivalent to the reference listed drug, meaning it is absorbed in the body at the same rate and to the same extent.

Generic products may be significantly less costly to bring to market than the reference listed drug and companies that produce generic products are generally able to offer them at lower prices.

Thus, following introduction of a generic drug, a significant percentage of the sales of any branded drug is typically lost to the generic product.

Competition that our products could face from generic versions of our products could materially and adversely affect our future revenue, profitability and cash flows and substantially limit our ability to obtain a return on the investments we have made in those products.

Generic drug manufacturers may seek to launch products following expiration of any applicable exclusivity period we obtain if our products are approved, even if we still have patent protection for such products, We would then enforce our patent rights through commencing an infringement litigation against the generic drug manufacturer.

Any such infringement litigation is inherently costly and uncertain.

In Europe, the European Commission has granted marketing authorizations for several biosimilar products pursuant to a set of general and product class-specific guidelines for biosimilar approvals issued over the past few years.

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For instance, Canada currently provides for an eight-year period of exclusivity for new biological products, and Mexico provides for a five-year period of exclusivity.

Furthermore, in some countries outside of the United States, peptide vaccines, such as GPS and NPS, are regulated as chemical drugs rather than as biologics and may or may not be eligible for non-patent exclusivity.

Furthermore, in some countries outside of the United States, peptide vaccines, such as GPS, are regulated as chemical drugs rather than as biologics and may or may not be eligible for non-patent exclusivity.

If competitors are able to obtain marketing approval for biosimilars referencing our therapeutic candidates, if approved, our future products may become subject to competition from such biosimilars, whether or not they are designated as interchangeable, with the attendant competitive pressure and potential adverse consequences.

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issued patents and pending patent applications owned by third parties exist in the fields in which we are developing and may develop our current and future product candidates.

As the biotechnology and pharmaceutical industries expand and more patents are issued, and as our product pipeline grows, the risk increases that our product candidates may be subject to claims of infringement of third parties’ patent rights as it may not always be clear to industry participants, including us, which patents cover various types of products or

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methods of use.

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

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Consequently, we and our licensors may not be able to prevent third parties from practicing our and our licensors’ inventions in countries outside the United States, or from selling or importing infringing products made using our and our licensors’ inventions in and into the United States or other jurisdictions.

Competitors may use our and our licensors’ technologies in jurisdictions where we have not obtained patent protection or where we do not have exclusive rights under the relevant patent(s) to develop their own products and, further, may export otherwise infringing products to territories where we and our licensors have patent protection but where enforcement is not as strong as that in the United States.

strong as that in the United States.

These infringing products may compete with our product candidates in jurisdictions where we or our licensors have no issued patents or where we do not have exclusive rights under the relevant patent(s), or our patent claims and other intellectual property rights may not be effective or sufficient to prevent them from so competing.

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Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions.

The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection, particularly those relating to biopharmaceuticals, which could make it difficult for us and our licensors to stop the infringement of our and our licensors’ patents or marketing of competing products in violation of our and our licensors’ proprietary rights generally.

The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection, particularly those relating to drugs and biologics, which could make it difficult for us and our licensors to stop the infringement of our and our licensors’ patents or marketing of competing products in violation of our and our licensors’ proprietary rights generally.

Certain governments outside the United States have indicated that compulsory licenses to patents may be sought to further their domestic policies or on the basis of national emergencies.

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patent authority may be necessary to determine the priority of inventions or matters of inventorship with respect to our or our licensors’ patents or patent applications.

We may also become involved in other proceedings, such as reexamination or opposition proceedings, inter partes review, post-grant review or other pre-issuance or post-grant proceedings in the USPTO or its foreign counterparts relating to our intellectual property or the intellectual property of others.

We may also become involved in other proceedings, such as reexamination, reissue, or opposition proceedings, inter partes review, post-grant review or other pre-issuance or post-grant proceedings in the USPTO or its foreign counterparts relating to our intellectual property or the intellectual property of others.

An unfavorable outcome in any such proceeding could require us or our licensors to cease using the related technology and commercializing the affected product candidate, or to attempt to license rights to it from the prevailing party.

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Our business could be harmed if the prevailing party does not offer us or our licensors a license on commercially reasonable terms if any license is offered at all.

Even if we or our licensors obtain a license, it may be non-exclusive, thereby giving our competitors access to the same technologies licensed to us or our licensors.

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

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

Even if we successfully defend such litigation or proceeding, we may incur substantial costs and it may distract our management and other employees.

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Although we have taken steps to protect our trade secrets and unpatented know-how, by entering into confidentiality agreements with third parties, and proprietary information and invention agreements with certain employees, consultants and advisors, third parties may still obtain this information or we may be unable to protect our rights.

Proprietary trade secrets and unpatented know-how are also very important to our business.

We also have limited control over the protection of trade secrets used by our licensors, collaborators and suppliers.

There can be no assurance that binding agreements will not be breached, that we would have adequate remedies for any breach, or that our trade secrets and unpatented know-how will not otherwise become known or be independently discovered by our competitors.

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Even if we are successful in defending against any such claims, any such litigation would likely be protracted, expensive, a distraction to our management team, not viewed favorably by investors and other third parties, and may potentially result in an unfavorable outcome.

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If we are unable to protect the confidentiality of our trade secrets and other proprietary information, the value of our technology could be materially adversely affected, and our business could be harmed.

Proprietary trade secrets and unpatented know-how are also very important to our business.

We also have limited control over the protection of trade secrets used by our licensors, collaborators and suppliers.

In addition to seeking the protection afforded by patents, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable or that we elect not to patent, processes for which patents are difficult to enforce, and other elements of our technology, discovery and development processes that involve proprietary know-how, information or technology that is not covered by patents.

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These agreements are designed to protect our proprietary information.

Although we use reasonable efforts to protect our trade secrets, our employees, consultants, contractors, or outside scientific advisors might intentionally or inadvertently disclose our trade secrets or confidential, proprietary information to competitors.

Although we use reasonable efforts to protect our trade secrets, our employees,

consultants, contractors, or outside scientific advisors might intentionally or inadvertently disclose our trade secrets or confidential, proprietary information to competitors.

In addition, competitors may otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques.

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government funding, the provisions of the Bayh-Dole Act may similarly apply.

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Risks Related to Commercialization of Our Current and Future Product Candidates

Our commercial success depends upon attaining significant market acceptance of our current and future product candidates, if approved, among physicians, patients, healthcare payors and cancer treatment centers.

Even if we obtain regulatory approval for any of our current or future product candidates, the products may not gain market acceptance among physicians, healthcare payors, patients or the medical community, including cancer treatment centers.

Market acceptance of any product candidates for which we receive approval depends on a number of factors, including:

• the efficacy and safety of such product candidates as demonstrated in clinical trials;

• the clinical indications and patient populations for which the product candidate is approved;

• acceptance by physicians, major cancer treatment centers and patients of the drug as a safe and effective treatment;

• the adoption of novel immunotherapies by physicians, hospitals and third-party payors;

• the potential and perceived advantages of product candidates over alternative treatments;

• the safety of product candidates seen in a broader patient group, including our use outside the approved indications;

• any restrictions on use together with other medications;

• the prevalence and severity of any side effects;

• product labeling or product insert requirements of the FDA or other regulatory authorities;

If we obtain marketing approval, our commercial success depends on establishing or implementing our own sales, marketing, and distribution capabilities or entering into licensing or collaboration agreements for these purposes, and the timing of these.

With the exception of very few employees, including our executive officers, we do not yet have a broader team with any significant sales, marketing or distribution experience.

If we progress toward regulatory approval, we will take an efficient and measured approach to building our commercial infrastructure to commercialize our current and any future product candidates on our own, through licensing or collaboration agreements.

We will have to invest significant amounts of financial and management resources, some of which will be committed prior to the receipt of positive data.

We may need to successfully recruit, retain and train effective sales and marketing personnel, some of whom may be sought by our competitors.

Any delays in hiring an adequate number of experienced sales personnel (including support staff), inability to obtain access to key markets, and unforeseen time, cost and expenses associated with creating a separate and high performing sales and marketing organization could adversely impact commercialization of any product for which we obtain marketing approval.

We may elect to utilize contract sales forces or strategic partners to support in the commercialization of our product candidates.

If we enter into arrangements with third parties to perform sales, marketing and distribution services for our products, the resulting revenues or the profitability from these revenues to us are likely to be lower than if we had sold, marketed and distributed our products ourselves.

In addition, we may not be successful in entering into arrangements with third parties to sell, market and distribute our product candidates, or do so in a timely manner, or may be unable to do so on terms that are favorable to us.

We may also need the infrastructure and resources to maintain the contractual relationships and external support.

If we are not able to timely and properly establish a commercial organization on our own or in collaboration with third parties, then we may not be profitable.

Our commercial success depends upon attaining significant market acceptance of our current and future product candidates, if approved, among health care providers, third-party payors and operators of major cancer clinics.

Even if we obtain regulatory approval for any of our current or future product candidates, the products may not gain market acceptance among physicians, third-party payors, patients or the medical community.

For example, current cancer treatment such as chemotherapy and radiation therapy are well-established in the medical community, and health care providers may continue to rely on these treatments.

The degree of market acceptance of any product candidates for which we receive approval depends on a number of factors, including:

• the efficacy and safety of such product candidates as demonstrated in clinical trials, and acceptance of such by physicians, major cancer treatment centers, and patients;

• the potential and perceived advantages and disadvantages of product candidates over alternative treatments, including the degree of clinically meaningful improvement in care, ease of administration and prevalence and severity of side effects;

• the clinical indications and patient populations for which the product candidate is approved and the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies;

• the ability to garner placement of our therapeutics in widely accepted clinical practice treatment guidelines;

• product labeling or product insert requirements of the FDA or other regulatory authorities and any restrictions on use with other medications;

• the timing of market introduction of our products as well as competitive products;

• the development of manufacturing and distribution processes for commercial scale manufacturing for our novel WT1 peptide cancer immunotherapy product candidate;

• the cost of treatment in relation to alternative treatments;

• the availability of coverage, formulary status and adequate reimbursement from third-party payors and government authorities;

• relative convenience and ease of administration;

• the effectiveness of our sales and marketing efforts and those of our collaborators.

If any of our current and future product candidates are approved but fail to achieve market acceptance among physicians, patients, healthcare payors or cancer treatment centers, we will not be able to generate significant revenues, which would compromise our ability to become profitable.

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Even if we are able to commercialize our current or future product candidates, the products may not receive coverage and adequate reimbursement from third-party payors in the United States and in other countries in which we seek to commercialize our products, which could harm our business.

Our ability to commercialize any product successfully will depend, in part, on the extent to which coverage and adequate reimbursement for these products and related treatments will be available from third-party payors, including government health administration authorities, private health insurers and other organizations.

Third-party payors determine which medications they will cover and establish reimbursement levels.

A primary trend in the healthcare industry is cost containment.

Third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications.

• the cost of treatment and coverage and reimbursement status;

• development and effectiveness of our sales and marketing, manufacturing and distribution efforts for commercial scale.

If any of our current and future product candidates are approved but fail to achieve market acceptance, we will not be able to generate significant revenues, which would compromise our ability to become profitable.

Even if we are able to commercialize our current or future product candidates, the products may become subject to unfavorable pricing regulations, third-party reimbursement practices or health care reform initiatives, which could harm our business.

Significant uncertainty exists as to the coverage and reimbursement status of any drug or biological candidates for which we obtain regulatory approval.

The regulations that govern marketing approvals, pricing and reimbursement for new drug products vary widely from country to country.

In the United States, recently passed legislation may significantly change the approval requirements in ways that could involve additional costs and cause delays in obtaining approvals.

Some countries require approval of the sale price of a drug before it can be marketed.

In many countries, the pricing review period begins after marketing or product licensing approval is granted.

In some foreign markets, prescription pharmaceutical pricing remains subject to continuing governmental control even after initial approval is granted.

As a result, we might obtain marketing approval for a product in a particular country, but then be subject to price regulations that delay our commercial launch of the product, possibly for lengthy time periods, and negatively impact the revenues we are able to generate from the sale of the product in that country.

Adverse pricing limitations may hinder our ability to recoup our investment in one or more product candidates, even if our product candidates obtain marketing approval.

Our ability to commercialize any product successfully will also depend, in part, on the extent to which reimbursement for these products and related treatments will be available from government health administration authorities, private health insurers and other organizations.

Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which medications they will cover and how much they will pay.

A primary trend in the U.S.

health care industry and elsewhere is cost containment.

Government authorities and third-party have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications.

Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products.

Third-party payors may also seek additional clinical evidence, beyond the data required to obtain regulatory approval, demonstrating clinical benefit and value in specific patient populations before covering our products for those patients.

We cannot be sure that coverage and adequate reimbursement will be available for any product that we commercialize and, if coverage is available, what the level of reimbursement will be.

Coverage and reimbursement may impact the demand for, or the price of, any product candidate for which we obtain regulatory approval.

If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize any product candidate for which we obtain regulatory approval.

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

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

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

We cannot be sure that reimbursement will be available for any product that we commercialize and, if reimbursement is available, the level of reimbursement.

Reimbursement may impact the demand for, or the price of, any product candidate for which we obtain marketing approval.

Obtaining reimbursement for our products may be particularly difficult because of the higher prices often associated with drugs administered under the supervision of a physician.

If reimbursement is not available or is available only to limited levels, we may not be able to successfully commercialize any product candidate for which we obtain marketing approval.

There may be significant delays in obtaining reimbursement for newly approved drugs, and coverage may be more limited than the purposes for which the drug is approved by the FDA or similar foreign regulatory authorities outside the United States.

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

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

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

Net prices for drugs may be reduced by mandatory discounts or rebates required by third-party payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the United States.

No uniform policy for coverage and reimbursement exists in the United States, and coverage and reimbursement can differ significantly from payor to payor.

Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies, but also have their own methods and approval process apart from Medicare determinations.

Our inability to promptly obtain coverage and profitable 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, ability to raise capital needed to commercialize products and overall financial condition.

Healthcare legislative measures aimed at reducing healthcare costs may have a material adverse effect on our business and results of operations.

The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system that could prevent or delay marketing approval of our current product candidates and any future product candidates, restrict or regulate post-approval activities and affect our ability to profitably sell a product for which we obtain marketing approval.

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

Third-party payors often follow CMS coverage policy and payment limitations in setting their own reimbursement policies.

Our inability to promptly obtain coverage and profitable payment 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.

Health care policy changes may have a material adverse effect on our business and results of operations.

Our business may be affected by the efforts of government and third-party payors to contain or reduce the cost of health care through various means.

For example, the Inflation Reduction Act of 2022 (IRA) requires drug manufacturers to pay a rebate to the federal government if prices for single-source drugs and biologicals covered under Medicare Part B and nearly all covered drugs under Part D increase faster than the rate of inflation (CPI-U).

The Patient Protection and Affordable Care Act, and the Health Care and Education Affordability Reconciliation Act of 2010 (collectively, the Affordable Care Act or ACA), enacted in March 2010, substantially changed the way health care is financed by both governmental and private insurers, and significantly impacted the pharmaceutical industry.

With regard to pharmaceutical products, among other things, the ACA is expected to expand and increase industry rebates for drugs covered under Medicaid programs and make changes to the coverage requirements under the Medicare Part D program.

The Supreme Court upheld the ACA in the main challenge to the constitutionality of the statute in 2012.

The Supreme Court also upheld federal subsidies for purchasers of insurance through federally facilitated exchanges in a decision released in June 2015.

While other challenges remain to portions of the ACA, these two cases were generally viewed as the only existential threats to the statute that have been raised so far.

Proposals such as expanding the Medicaid drug rebate program to the Medicare Part D program, providing authority for the government to negotiate drug prices under the Medicare Part D program and lowering reimbursement for drugs covered under the Medicare Part B program have been presented to Congress in 2016, including by the current Administration, but implementation likely will be challenging in light of strong opposition to these proposals as well as the current political climate.

The Administration can rely on its existing statutory authority to make policy changes that could have an impact on the drug industry.

For example, the Medicare program has proposed to test alternative payment methodologies for drugs covered under the Part B program.

In general, we cannot predict the impact that the ACA or any other legislative or regulatory proposals will have on our business.

Regardless of whether or not the ACA is changed or modified by Congress or the Supreme Court, we expect both government and private health plans to continue to require health care providers, including health care providers that may one day purchase our products, to contain costs and demonstrate the value of the therapies they provide.

The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the health care system that could prevent or delay marketing approval of our current product candidates and any future product candidates, restrict or regulate post-approval activities and affect our ability to profitably sell a product for which we obtain marketing approval.

Changes in regulations, statutes or the interpretation of existing regulations could impact our business in the future by requiring, for example, changes to our manufacturing arrangements, additions or modifications to product labeling, the recall or discontinuation of our products, or additional record-keeping or reporting requirements.

If any such changes were to be imposed, they could adversely affect the operation of our business.

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In the United States, there have been and continue to be a number of legislative initiatives to contain healthcare costs.

For example, the ACA substantially changed the way healthcare is financed by both governmental and private insurers, and significantly impacted the U.S.

pharmaceutical industry.

In the United States, there have been and continue to be a number of legislative initiatives to contain health care costs.

For example, the ACA substantially changed the way health care is financed by both governmental and private insurers, and significantly impacted the U.S.

biopharmaceutical industry.

The ACA, among other things, subjected biological products to potential competition by lower-cost biosimilars, addressed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs and biologics that are inhaled, infused, instilled, implanted or injected, increased the minimum Medicaid rebates owed by manufacturers under the Medicaid Drug Rebate Program and extended the rebate program to individuals enrolled in Medicaid managed care organizations, established annual fees and taxes on manufacturers of certain branded prescription drugs and biologics, and created a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 70% (increased from 50% pursuant to the Bipartisan Budget Act of 2018, effective as of 2019) point-of-sale discounts off negotiated prices of applicable brand drugs and biologics to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs or biologics to be covered under Medicare Part D.

Since its enactment, there have been judicial, executive and Congressional challenges to certain aspects of the ACA.

On June 17, 2021, the U.S.

Supreme Court dismissed the most recent judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA.

Prior to the Supreme Court’s decision, President Biden issued an executive order to initiate a special enrollment period from February 15, 2021 through August 15, 2021 for purposes of obtaining health insurance coverage through the ACA marketplace.

The executive order also instructed certain governmental agencies to review and reconsider their existing policies and rules that limit access to healthcare, including among others, re-examining Medicaid demonstration projects and waiver programs that include work requirements, and policies that create unnecessary barriers to obtaining access to health insurance coverage through Medicaid or the ACA.

It is unclear how other healthcare reform measures of the Biden administration or other efforts, if any, to challenge, repeal or replace the ACA will impact the ACA or our business.

In addition, other legislative changes have been proposed and adopted since the ACA was enacted.

On August 2, 2011, the Budget Control Act of 2011 was signed into law, which, among other things, resulted in reductions to Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013 and, due to subsequent legislative amendments to the statute, will remain in effect through 2030, with the exception of a temporary suspension from May 1, 2020 through June 30, 2022 (a 1% sequester will apply from April 1, 2022 through June 30, 2022) due to the COVID-19 pandemic, unless additional Congressional action is taken.

On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, reduced Medicare payments to several providers, including hospitals and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

As another example, the 2021 Consolidated Appropriations Act signed into law on December 27, 2020 incorporated extensive healthcare provisions and amendments to existing laws, including a requirement that all manufacturers of drugs and biological products covered under Medicare Part B report the product’s average sales price, or ASP, to Department of Health and Human Services (HHS) beginning on January 1, 2022, subject to enforcement via civil money penalties.

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Further, there has been heightened governmental scrutiny in the United States of pharmaceutical pricing practices in light of the rising cost of prescription drugs.

However, following several years of litigation in the federal courts, in June 2021, the U.S.

Supreme Court upheld the ACA when it dismissed a legal challenge to the ACA’s constitutionality.

Further legislative and regulatory changes under the ACA remain possible, but it is unknown what form any such changes or any law would take, and how or whether it may affect the biopharmaceutical industry as a whole or our business in the future.

We expect that changes or additions to the ACA, the Medicare and Medicaid programs and changes stemming from other health care reform measures, especially with regard to health care access, financing or other legislation in individual states, could have a material adverse effect on the health care industry in the United States.

In addition, other legislative changes have been proposed and adopted in the United States since the ACA that affect health care expenditures.

These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2022, which began in 2013 and was extended by the Consolidated Appropriations Act for 2023, and will remain in effect through 2023, unless additional Congressional action is taken.

Further, there has been heightened governmental scrutiny in the United States of drug and biological product pricing practices in light of the rising cost of prescription drugs.

Such scrutiny has resulted in several recent congressional inquiries and proposed and enacted federal and state legislation 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 products.

Although a number of these and other measures may require additional authorization to become effective, Congress and the current U.S.

administration have each indicated that it will continue to seek new legislative and/or administrative measures to control drug costs.

Any reduction in reimbursement from Medicare and other government programs may result in a similar reduction in payments from private payors.

Moreover, in July 2021, President Biden issued a sweeping executive order on promoting competition in the American economy that includes several mandates pertaining to the pharmaceutical and health care insurance industries.

Among other things, the executive order directs the FDA to work towards implementing a system for importing drugs from Canada (following on a Trump administration notice-and-comment rulemaking on Canadian drug importation that was finalized in October 2020).

The Biden order also called on HHS to release a comprehensive plan to combat high prescription drug prices, and it includes several directives regarding the Federal Trade Commission’s oversight of potentially anticompetitive practices within the pharmaceutical industry.

The drug pricing plan released by HHS in September 2021 in response to the executive order makes clear that the Biden Administration supports aggressive action to address rising drug prices, including allowing HHS to negotiate the cost of Medicare Part B and D drugs, but such significant changes will require either new legislation to be passed by Congress or time-consuming administrative actions.

Accordingly, there remains a large amount of uncertainty regarding the federal government’s approach to making pharmaceutical treatment costs more affordable for patients.

At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

or example, California requires pharmaceutical manufacturers to notify certain purchasers, including health insurers and government health plans at least 60 days before any scheduled increase in the wholesale acquisition cost (WAC), of their product if the increase exceeds 16%, and further requires pharmaceutical manufacturers to explain whether a change or improvement in the product necessitates such an increase.

Similarly, Vermont requires pharmaceutical manufacturers to disclose price information on certain prescription drugs, and to provide notification to the state if introducing a new drug with a WAC in excess of the Medicare Part D specialty drug threshold.

In May 2019, DHHS issued a final rule to allow Medicare Advantage plans the option to use step therapy for Part B drugs beginning January 1, 2020.

This rule codified a DHHS policy change that was effective January 1, 2019.

More recently, in August 2022, President Biden signed into the law the Inflation Reduction Act of 2022, or the IRA.

Among other things, the IRA has multiple provisions that may impact the prices of drug products that are both sold into the Medicare program and throughout the United States.

Starting in 2023, a manufacturer of a drug or biological product covered by Medicare Parts B or D must pay a rebate to the federal government if the drug product’s price increases faster than the rate of inflation.

This calculation is made on a drug product by drug product basis and the amount of the rebate owed to the federal government is directly dependent on the volume of a drug product that is paid for by Medicare Parts B or D.

Additionally, starting in payment year 2026, CMS will negotiate drug prices annually for a select number of single source Part D drugs without generic or biosimilar competition.

CMS will also negotiate drug prices for a select number of Part B drugs starting for payment year 2028.

If a drug product is selected by CMS for negotiation, it is expected that the revenue generated from such drug will decrease.

Individual states in the United States have also increasingly passed legislation and implemented regulations designed to control biopharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

In December 2020, the U.S.

Supreme Court also held unanimously that federal law does not preempt the states’ ability to regulate pharmaceutical benefit managers, or PBMs, and other members of the healthcare and pharmaceutical supply chain, an important decision that may lead to further and more aggressive efforts by states in this area.

Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, results of operations, financial condition and prospects.

In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs.

This could reduce the ultimate demand for our product candidates, if approved, or put pressure on our product pricing, which could negatively affect our business, results of operations, financial condition and prospects.

We expect that the ACA, the recent laws described above, and 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.

Further, it is possible that additional governmental action will be taken in response to the COVID-19 pandemic.

Supreme Court held unanimously that federal law does not preempt the states’ ability to regulate pharmacy benefit managers, or PBMs, and other members of the health care and pharmaceutical supply chain, an important decision that may lead to further and more aggressive efforts by states in this area.

In addition, the Federal Trade Commission in mid-2022 also launched sweeping investigations into the practices of the PBM industry that could lead to additional federal and state legislative or regulatory proposals targeting such entities’ operations, pharmacy networks, or financial arrangements.

Significant efforts to change the PBM industry as it currently exists in the United States may affect the entire pharmaceutical supply chain and the business of other stakeholders, including biopharmaceutical developers like us.

We expect that the ACA, the recent laws described above, and other health care reform measures that may be adopted in the future may result in additional reductions in Medicare and other health care funding, more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price that we receive for any approved product.

We cannot predict the initiatives that may be adopted in the future.

The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare and/or impose price controls may adversely affect:

The continuing efforts of the government, insurance companies, managed care organizations and other payors of health care services to contain or reduce costs of health care and/or impose price controls may adversely affect:

• the demand for our product candidates, if we obtain regulatory approval;

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• our ability to enjoy or maintain market exclusivity;

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• the level of taxes that we are required to pay;

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If reimbursement of our products is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, our business could be adversely affected.

Risks Related to Healthcare Compliance Regulations

Our relationships with 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, contractual damages, reputational harm and diminished profits and future earnings.

Risks Related to Health Care Compliance Regulations

Our relationships with customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other health care laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings.

If we or they are unable to comply with these provisions, we may become subject to civil and criminal investigations and proceedings that could have a material adverse effect on our business, financial condition and prospects.

Healthcare providers, physicians and third-party payors will play a primary role in the recommendation and prescription of any product candidates for which we obtain regulatory approval.

Our current and future arrangements with healthcare providers, healthcare entities, third-party payors and customers may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which we research, develop and will market, sell and distribute our products.

As a pharmaceutical company, even though we do not and will not control referrals of healthcare services or bill directly to Medicare, Medicaid or other third-party payors, federal and state healthcare laws and regulations pertaining to fraud and abuse and patients’ rights are applicable to our business.

Restrictions under applicable federal and state healthcare laws and regulations that may affect our ability to operate include the following:

• the federal healthcare Anti-Kickback Statute which prohibits, among other things, individuals and entities from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made, in whole or in part, under a federal healthcare program such as Medicare or Medicaid;

Health care providers, physicians and third-party payors will play a primary role in the recommendation and prescription of any product candidates for which we obtain regulatory approval.

Our current and future arrangements with health care providers, health care entities, third-party payors and customers may expose us to broadly applicable fraud and abuse and other health care laws and regulations that may constrain the business or financial arrangements and relationships through which we research, develop and will market, sell and distribute our products.

As a biopharmaceutical company, even though we do not and will not control referrals of health care services or bill directly to Medicare, Medicaid or other third-party payors, federal and state health care laws and regulations pertaining to fraud and abuse and patients’ rights are applicable to our business.

Restrictions under applicable federal and state health care laws and regulations that may affect our ability to operate include the following:

• the federal health care Anti-Kickback Statute which prohibits, among other things, individuals and entities from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made, in whole or in part, under a federal health care program such as Medicare or Medicaid;

• federal civil and criminal false claims laws, including the federal False Claims Act that can be enforced through civil whistleblower or qui tam actions, and civil monetary penalty laws, prohibit individuals or entities from knowingly presenting, or causing to be presented, to the federal government, including the Medicare and Medicaid programs, claims for payment or approval that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government;

• the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for executing a scheme to defraud any healthcare benefit program and also created federal criminal laws that prohibit knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statements in connection with the delivery of or payment for healthcare benefits, items or services, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, or HITECH, which imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually

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identifiable health information on entities subject to the law, such as certain healthcare providers, health plans, and healthcare clearinghouses, known as covered entities, and their respective business associates that perform services for them that involve the creation, use, maintenance or disclosure of, individually identifiable health information;

• the federal physician sunshine requirements under the ACA which requires certain manufacturers of drugs, devices, biologics and medical supplies, with certain exceptions, to report annually to HHS information related to payments and other transfers of value to physicians, other healthcare providers, and teaching hospitals, and ownership and investment interests held by physicians and other healthcare providers and their immediate family members and applicable group purchasing organizations;

• analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers;

some state laws which require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers, marketing expenditures or pricing information;

• the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for executing a scheme to defraud any health care benefit program and also created federal criminal laws that prohibit knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statements in connection with the delivery of or payment for health care benefits, items or services, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, or HITECH, which imposes obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information

on entities subject to the law, such as certain health care providers, health plans, and health care clearinghouses, known as covered entities, and their respective business associates that perform services for them that involve the creation, use, maintenance or disclosure of, individually identifiable health information;

• the federal physician sunshine requirements under the ACA which requires certain manufacturers of drugs, devices, biologics and medical supplies, with certain exceptions, to report annually to HHS information related to payments and other transfers of value to physicians, certain non-physician health care practitioners, and teaching hospitals, and ownership and investment interests held by physicians and other health care providers and their immediate family members and applicable group purchasing organizations;

• analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving health care items or services reimbursed by non-governmental third-party payors, including private insurers;

some state laws which require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require drug manufacturers to report information related to payments and other transfers of value to physicians and other health care providers, marketing expenditures or pricing information;

and certain state and local laws which require the registration of pharmaceutical sales representatives;

• state and foreign laws govern the privacy and security of health information in specified circumstances, including the GDPR, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.

Efforts to ensure that our business arrangements with third parties will comply with applicable healthcare laws and regulations will involve substantial costs.

It is possible that governmental authorities will conclude that our business practices may not comply with current or future statutes, regulations or case law involving applicable fraud and abuse or other healthcare laws and regulations.

If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, imprisonment, disgorgement, exclusion from government funded healthcare programs, such as Medicare and Medicaid, integrity oversight and reporting obligations, and the curtailment or restructuring of our operations.

If any physicians or other healthcare providers or entities with whom we expect to do business are found to not be in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs.

Many healthcare laws and regulations are rapidly changing and legislative bodies and regulatory agencies are regularly considering amendments and supplements to existing laws and regulations, and as a result interpretations of rules and confirmation of our compliance with such rules can be ambiguous.

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Efforts to ensure that our business arrangements with third parties will comply with applicable health care laws and regulations will involve substantial costs.

If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, imprisonment, disgorgement, exclusion from government funded health care programs, such as Medicare and Medicaid, integrity oversight and reporting obligations, and the curtailment or restructuring of our operations.

If any physicians or other health care providers or entities with whom we expect to do business are found to not be in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded health care programs.

Many health care laws and regulations are rapidly changing and legislative bodies and regulatory agencies are regularly considering amendments and supplements to existing laws and regulations, and as a result interpretations of rules and confirmation of our compliance with such rules can be ambiguous.

Our employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could cause significant liability for us and harm our reputation.

We are exposed to the risk of employee fraud or other misconduct, including intentional failures to comply with FDA regulations or similar regulations of comparable foreign regulatory authorities, provide accurate information to the FDA or comparable foreign regulatory authorities, comply with manufacturing standards we have established, comply with federal and state healthcare fraud and abuse laws and regulations and similar laws and regulations established and enforced by comparable foreign regulatory authorities, report financial information or data accurately or disclose unauthorized activities to us.

We are exposed to the risk of employee fraud or other misconduct, including intentional failures to comply with FDA regulations or similar regulations of comparable foreign regulatory authorities, provide accurate information to the FDA or comparable foreign regulatory authorities, comply with manufacturing standards we have established, comply with federal and state health care fraud and abuse laws and regulations and similar laws and regulations established and enforced by comparable foreign regulatory authorities, report financial information or data accurately or disclose unauthorized activities to us.

Employee misconduct could also involve the improper use of information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation.

It is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations.

If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business and results of operations, including the imposition of significant civil, criminal and administrative penalties, damages, fines, imprisonment, exclusion from government funded healthcare programs, such as Medicare and Medicaid, and integrity oversight and reporting obligations.

We have been involved in multiple legal and governmental proceedings, including securities class action litigation, and may in the future be involved in proceedings, relating to the commercial activities of our predecessor that could divert management’s attention and adversely affect our financial condition and our business.

fines, imprisonment, exclusion from government funded health care programs, such as Medicare and Medicaid, and integrity oversight and reporting obligations.

In the past, we have been involved in multiple legal and governmental proceedings, including securities class action litigation, and may in the future be involved in proceedings, relating to the commercial activities of our predecessor that could divert management’s attention and adversely affect our financial condition and our business.

In the past, our predecessor, Galena, was involved in multiple legal and governmental proceedings, including stockholder class actions, both state and federal, none of which are ongoing.

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Litigation often is expensive and diverts management’s attention and resources, which could adversely affect the continuing company’s business.

There continues to be significant litigation and governmental activity generally in the fentanyl and opioid area, and this activity is expected to continue and may increase in the future.

There has been significant litigation and governmental activity generally in the fentanyl and opioid area, and this activity may continue in the future.

We cannot assure you we will not become subject to additional legal or governmental proceedings relating to Galena’s former Abstral business in the future.

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We can make no assurances as to the time or resources that would need to be devoted to any new or future litigation matters or their outcome, or the impact, if any, that these matters may have on our business or financial condition.

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Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop.

We face an inherent risk of product liability exposure related to the testing of our current or future product candidates in human clinical trials and will face an even greater risk if we commercially sell any products that we may develop.

Product liability claims may be brought against us by subjects enrolled in our clinical trials, patients, healthcare providers or others using, administering or selling our products.

Product liability claims may be brought against us by subjects enrolled in our clinical trials, patients, health care providers or others using, administering or selling our products.

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

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Risks Related to our Business Operations

Our business has been and may continue to be adversely affected by COVID-19.

The ongoing global COVID-19 pandemic, including the surges of cases from the Delta and Omicron variants, continues to disrupt our business operations and those of our contractors, CROs, suppliers, clinical sites, CMOs, and other partners.

The COVID-19 pandemic could affect the health and availability of our workforce and that of the third-parties we rely on, such as our CROs, clinical sites, CMOs, and other contractors as well as the governmental agencies, such as the FDA and health authorities in other countries which could delay or otherwise adversely impact the ability of such parties to fulfill their obligations.

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In particular, our clinical trial operations, including the REGAL study, have been directly and indirectly adversely impacted globally, and could continue to be directly and indirectly adversely impacted, by the COVID-19 pandemic.

Restrictions on travel and/or transport of clinical materials as well as the diversion of hospital and clinical site staff and resources to COVID-19 infected patients has, and could continue, to disrupt clinical trial operations, including causing delays, potentially resulting in a slowdown in enrollment and/or deviations from or disruptions in key clinical trial activities, such as clinical site monitoring.

Further, if the spread of COVID-19 continues, the operations of our CMOs for our clinical supply of GPS could be significantly delayed as well and we risk a delay, default and/or nonperformance under our existing agreements.

While we believe that we currently have sufficient supply of our product candidates to continue our ongoing clinical trials, such delays, defaults or non-performance could materially adversely affect the timelines of our clinical trials.

The COVID-19 pandemic and mitigation measures also may have an adverse impact on global economic conditions, which could adversely impact our business, financial condition or results of operations.

Additionally, the COVID-19 pandemic has resulted in significant financial market volatility and uncertainty.

A continuation or worsening of the levels of market disruption or volatility seen in the recent past due to the COVID-19 pandemic could have an adverse impact on our ability to access capital and on the market price of our common stock.

It is currently not possible to predict how long the COVID-19 pandemic will last, including whether there will be additional surges from new variants, or the time that it will take for economic activity to return to pre-pandemic levels.

The extent to which COVID-19 impacts our business and operations, and our employees, suppliers, CROs and other partners will depend on future developments that are highly uncertain and cannot be predicted, including the duration of the outbreak, the continued availability and efficacy of vaccines, new information which may emerge concerning the severity of COVID-19, the emergence of new variants of COVID-19, and the actions to contain COVID-19 or treat its impact, among others.

A pandemic, epidemic, or outbreak of an infectious disease, such as the COVID-19 pandemic, could materially and adversely affect our business.

Public health crises such as pandemics or similar outbreaks could adversely impact our business.

Notably, the COVID-19 pandemic continues to evolve.

The extent to which COVID-19 impacts our operations or those of our collaborators, contractors, suppliers, CROs, clinical sites, CMOs and other material business relations and governmental agencies will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the outbreak, new information that will emerge concerning the severity of the virus and the actions to contain it or treat its impact, among others.

Previously, our clinical trial operations were directly and indirectly adversely impacted, and could continue to be directly and indirectly adversely impacted, by the COVID-19 pandemic.

The spread of COVID-19 could also have adverse economic impacts to us.

While the potential economic impact brought by, and the duration of, the COVID-19 pandemic, have been, and continue to be, difficult to assess or predict, the spread of COVID-19 has caused a broad impact globally.

The ongoing COVID-19 pandemic continues to evolve.

The extent to which the COVID-19 pandemic may impact our business continues to be highly uncertain and cannot be predicted with confidence.

If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud.

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Ineffective internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our common stock, and which could impact our ability to raise capital in the future.

In addition, any future testing by us conducted in connection with Section 404 of the Sarbanes-Oxley Act of 2002, as amended (“SOX”), or any required subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our consolidated financial statements or identify other areas for further attention or improvement.

In addition, any future testing by us conducted in connection with Section 404 of the Sarbanes-Oxley Act of 2002, as amended, or SOX, or any required subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our consolidated financial statements or identify other areas for further attention or improvement.

We are required, pursuant to Section 404 of SOX, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting as of December 31, 2022.

However, our independent registered public accounting firm is not required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404.

Under the supervision and with the participation of our Chief Executive Officer and Vice President Finance and Chief Accounting Officer, our management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the guidelines in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, our management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the guidelines in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on that evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2022.

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Undetected material weaknesses in our internal controls could lead to financial statement restatements and require us to incur the expense of remediation.

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We face substantial competition, which may result in others discovering, developing or commercializing products before or more successfully than we do.

We face competition from numerous pharmaceutical and biotechnology enterprises, as well as from academic institutions, government agencies and private and public research institutions for our current product candidates.

Our commercial opportunities will be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer side effects or are less expensive than any products that we may develop.

Competition could result in reduced sales and pricing pressure on our current or future product candidates, if approved, which in turn would reduce our ability to generate meaningful revenues and have a negative impact on our results of operations.

In addition, significant delays in the development of our product candidates could allow our competitors to bring products to market before we do and impair our ability to commercialize our product candidates.

The biotechnology industry, including the cancer immunotherapy market, is intensely competitive and involves a high degree of risk.

We compete with other companies that have far greater experience and financial, research and technical resources than us.

Potential competitors in the United States and worldwide are numerous and include pharmaceutical and biotechnology companies, educational institutions and research foundations, many of which have substantially greater capital resources, marketing experience, research and development staffs and facilities than ours.

Some of our competitors may develop and commercialize products that compete directly with those incorporating our technology or may introduce products to market earlier than our products or on a more cost-effective basis.

In addition, our technology may be subject to competition from other technology or methods developed using techniques other than those developed by traditional biotechnology methods.

Our competitors compete with us in recruiting and retaining qualified scientific and management personnel as well as in acquiring technologies complementary to our technology.

Our company and our collaborators may face competition with respect to product efficacy and safety, ease of use and adaptability to various modes of administration, acceptance by physicians, the timing and scope of regulatory approvals, availability of resources, reimbursement coverage, price and patent position, including the potentially dominant patent positions of others.

An inability to successfully complete our product development or commercializing those product candidates could result in our having limited prospects for establishing market share or generating revenue from our technology.

There are several agents in clinical development in potentially comparable settings to our Phase 3 AML clinical development program for GPS.

The most advanced of these products is Onureg (oral azacitidine) under development by Bristol-Myers Squibb, or BMS, which was approved by the FDA in September 2020 for maintenance therapy of AML patients after having achieved first complete remission.

There are several of other investigational immunotherapies advancing through Phase 2 and Phase 3 trials for target indications that we believe are also potential target indications for GPS.

If these or other therapies are successful in their development, it could negatively impact our ability to enroll our clinical trials and could negatively impact the commercial potential of GPS.

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Principal competitors for our AML indication include both companies with currently approved products in AML, such as AbbVie/Genentech (the holders of rights to VENCLEXTA), Servier (the holder of U.S.

rights to TIBSOVO), Novartis AG (the holder of rights to RYDAPT), Astellas Pharmaceuticals (the holder of rights to XOSPATA), BMS (the holder of rights to ONUREG/VIDAZA and IDHIFA), Otsuka Pharmaceutical Co., Ltd.

(the holder of rights to DACOGEN), among others, as well as those with front-line chemotherapy drugs and maintenance therapies such as Jazz Pharmaceuticals, Inc.

(the holder of rights to VYXEOS), as well as Pfizer Inc.

(the holder of rights to MYLOTARG and DAURISMO), among others, as well as companies with drugs currently in development in AML, such Daiichi Sankyo (the holder of rights to quizartinib/licensed in Japan under the trade name VANFLYTA), Karyopharm Therapeutics, Inc.

(the holder of rights to XPOVIO), Pfizer Inc./AROG Pharmaceuticals, LLC (the holders of rights to crenolanib), Novartis AG (the holder of rights to MBG453), Johnson & Johnson/Janssen Pharmaceuticals, Inc.

(the holder of rights to cusatuzumab, or ARGX-110/JNJ-4550), Gilead Sciences, Inc.

(the holder of rights to magrolimab, or Hu5F9 G4), and Actinium Pharmaceuticals, Inc.

(the holder of rights to [131]-iodine-apamistamab, or Iomab-B), among others.

Companies currently engaged in the clinical development of AML therapies with an immunological/immuno-modulatory mechanism of action include Pfizer Inc./EMD Serono (the holders of rights to BAVENCIO), BMS (the holder of rights to YERVOY), MacroGenics, Inc./Les Laboratoires Servier, SA (the holders of rights to flotetuzumab, or MGD006), Celyad Oncology SA (the holder of rights to CYAD-01), Fortress Biotech, Inc.

(the holder of rights to CNDO-109), Glycostem Therapeutics BV (the holder of rights to oNKord), iCell Gene Therapeutics, LLC (the holder of rights to CLL1-CD33 Compound CAR T-cell), among others.

Finally, companies currently engaged in the clinical development of WT1-targeting vaccines (not specifically for AML) include Otsuka Pharmaceutical Co., Ltd.

(the holder of rights to OCV-501) and Dainippon Sumitomo Pharma Co., Ltd./ Boston Biomedical, Inc.

(the holder of rights to DSP-7888/ade-gramotide/nelatimotide).

We are also conducting clinical development programs in combination with cancer checkpoint inhibitors.

This is a highly competitive field, with hundreds of such combination trials with various checkpoint inhibitors ongoing.

If one or more of these combinations produce positive results in indications that we believe are targets for GPS (either in combination or in stand-alone administration) this could increase the difficulty for us to conduct our trials and could negatively impact our path to regulatory approval and our ability to successfully commercialize our products.

Many of our competitors or potential competitors have significantly greater established presence in the market, financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do, and as a result may have a competitive advantage over us.

Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number of our competitors.

Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

These third parties compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies and technology licenses complementary to our programs or potentially advantageous to our business.

As a result of these factors, these competitors may obtain regulatory approval of their products before we are able to obtain patent protection or other intellectual property rights, which will limit our ability to develop or commercialize our current or future product candidates.

Our competitors may also develop drugs that are safer, more effective, more widely used and cheaper than ours, and may also be more successful than us in manufacturing and marketing their products.

These appreciable advantages could render our product candidates obsolete or noncompetitive before we can recover the expenses of development and commercialization.

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Our future success depends on our ability to demonstrate and maintain a competitive advantage with respect to the design, development, and commercialization of our product candidates.

Our competitors may succeed in developing competing products before we do for the same indications we are pursuing, obtaining regulatory approval for products, or gaining acceptance for the same markets that we are targeting.

If we are not “first to market” with a product candidate, thereby effecting our order of entry, our competitive position could be compromised via reduced market share and higher hurdles to regulatory approval.

We expect any product candidate which we commercialize will compete with products from other companies in the biotechnology and pharmaceutical industries.

For example, there are several biopharmaceutical companies who are currently marketing therapies to treat AML and are approved treatments in the United States.

There are also many companies in various clinical stages which are developing therapies to treat AML, including the following which are late-stage:

GlycoMimetics (uproleselan);

Actinium Pharmaceuticals (Iomab-B);

Delta-Fly Pharma (radgocitabine);

Gilead (magrolimab);

Daiichi Sankyo (VANFLYTA/quizartinib);

and AROG Pharmaceuticals (crenolanib).

With respect to our GPS program, we expect to compete with companies who are also developing WT1 targeting therapies to treat AML, such as Astellas (ASP7517), BMS (JTCR016), NexImmune (NEXI-001), Roche (RG63441/RO7283420), and Cue Biopharma (CUE-102).

With respect to our GHF009 program, we anticipate competition with companies who are investigating CDK9 targeting therapies to treat AML and our other potential indications, such as Vincerx (VIP152), AstraZeneca (AZD4573), Kronos Bio (KB-0742), Sumitomo Dainippon Pharma (TP-1287), MEI Pharma, Inc.

(Voruciclib) and Prelude Therapeutics (PRT2527).

Many of our competitors have substantially greater commercial infrastructures and financial, technical and personnel resources than we have.

In addition, some are farther along in their clinical development programs or in collaboration with larger, established pharmaceutical companies.

We may not be able to compete unless we successfully:

• design and develop products that are superior to other products in the market;

• conduct successful preclinical and clinical trials;

• attract qualified scientific, medical, sales and marketing and commercial personnel;

• obtain patent and/or other proprietary protection for our processes and product candidates;

• obtain required regulatory approvals;

• collaborate with others in the design, development, and commercialization of new products.

Established competitors may invest heavily to quickly discover and develop novel compounds that could make our product candidates obsolete.

In addition, any new product that competes with an approved product must demonstrate compelling advantages in efficacy, convenience, tolerability, and safety to overcome price competition and to be commercially successful.

If we are not able to compete effectively against our current and future competitors, our business will not grow, and our financial condition and operations will suffer.

We enter into various contracts in the normal course of our business in which we may be required to indemnify the other party to the contract under certain specific scenarios.

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Any interruption or breach in our systems could adversely affect our business operations and/or result in the loss of critical or sensitive confidential information or intellectual property, and could result in financial, legal, business and reputational harm to us or allow third parties to gain material, inside information that they use to trade in our securities.

For example, the loss of clinical trial data from completed or ongoing clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.

the loss of clinical trial data from completed or ongoing clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data.

To the extent that any disruption or security breach results in a loss of or damage to our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability, the further development of our current and future product candidates could be delayed and our business could be otherwise adversely affected.

In addition, we do not maintain separate cyber liability insurance.

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We will need to grow the size of our organization in the future, and we may experience difficulties in managing this growth.

As of December 31, 2021, we had 11 full-time employees.

We will need to grow the size of our organization in order to support our continued development and potential commercialization of our product candidates.

As of March 1, 2023, we had 17 full-time employees.

As our development and commercialization plans and strategies continue to develop, our need for additional managerial, operational, manufacturing, regulatory, sales, marketing, financial and other resources may increase.

Our management, personnel and systems currently in place may not be adequate to support this future growth.

We will need to grow the size of our organization in order to support our continued development and potential commercialization of our product candidates to complement our management and employees currently in place and to support our future growth.

Future growth would impose significant added responsibilities on members of management, including:

• managing our clinical trials effectively;

• identifying, recruiting, maintaining, motivating and integrating additional employees;

• identifying, recruiting, maintaining, motivating, integrating and retaining additional employees;

• managing our internal development efforts effectively while complying with our contractual obligations to licensors, licensees, contractors and other third parties;

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Further, if our compliance efforts differ from the activities intended by regulatory or governing bodies due to ambiguities related to practice, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

Being a public company that is subject to these rules and regulations also makes it more expensive for us to obtain and retain director and officer liability insurance, and we may in the future be required to accept reduced coverage or incur substantially higher costs to obtain or retain adequate coverage.

incur substantially higher costs to obtain or retain adequate coverage.

These factors could also make it more difficult for us to attract and retain qualified members of our board of directors and qualified executive officers.

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Our future success depends on our ability to retain our executive officers and to attract, retain and motivate qualified personnel.

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Many pharmaceutical and biotechnology companies with whom we compete for qualified personnel have greater financial and other resources, different risk profiles and longer histories in the industry than we do.

The Tax Cuts and Jobs Act could adversely affect our business and financial condition.

1, “An Act to provide for reconciliation pursuant to title II and V of the concurrent resolution on the budget for fiscal year 2018,” informally entitled the Tax Cuts and Jobs Act, or the Tax Act, enacted on December 22, 2017, among other things, contains significant changes to corporate taxation, including reduction of the corporate tax rate from a top marginal rate of 35% to a single rate of 21%, limitation of the tax deduction for interest expense to 30% of adjusted taxable income (except for certain small businesses), limitation of the deduction for net operating losses carried forward from taxable years beginning after December 31, 2017 to 80% of current year taxable income and elimination of net operating loss carrybacks, one time taxation of offshore earnings at reduced rates regardless of whether they are repatriated, elimination of U.S.

tax on foreign earnings (subject to certain important exceptions), providing immediate deductions for certain new investments instead of deductions for depreciation expense over time, and modifying or repealing many business deductions and credits (including reduction of tax credits under the Orphan Drug Act).

Notwithstanding the reduction in the corporate income tax rate, the overall impact of the Tax Act is uncertain and our business and financial condition could be adversely affected.

In addition, it is uncertain if and to what extent various states will conform to the Tax Act.

Notwithstanding the reduction in the corporate income tax rate, the overall impact of the Tax Act remains uncertain and our business and financial condition could be adversely affected.

In addition, as part of Congress’ response to the COVID-19 pandemic, the Families First Coronavirus Response Act, or the FFCR Act, was enacted on March 18, 2020, the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, was enacted on March 27, 2020, and COVID relief provisions were included in the Consolidated Appropriations Act, 2021 or CAA, which was enacted on December 27, 2020.

All contain numerous tax provisions.

Regulatory guidance under the Tax Act, the FFCR Act, the CARES Act, and the CAA is and continues to be forthcoming, and such guidance could ultimately increase or lessen their impact on our business and financial condition.

It is also likely that Congress will enact additional legislation in connection with the COVID-19 pandemic, and as a result of the changes in the U.S.

presidential administration and control of the U.S.

Senate, additional tax legislation may also be enacted;

any such additional legislation could have an impact on us.

In addition, it is uncertain if and to what extent various states will conform to the TCJA, the FFCR Act, the CARES Act, or the CAA.

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Legislation or other changes in U.S.

tax law could adversely affect our business and financial condition.

The rules dealing with U.S.

federal, state and local income taxation are constantly under review by persons involved in the legislative process and by the Internal Revenue Service and the U.S.

Treasury Department.

Changes to tax laws (which changes may have retroactive application) could adversely affect us or holders of our common stock.

In recent years, many changes have been made to applicable tax laws and changes are likely to continue to occur in the future.

For example, legislation enacted in 2017 informally titled, the Tax Cuts and Jobs Act, or the TCJA, made significant changes to corporate taxation, including the reduction of the corporate tax rate from a top marginal rate of 35% to a flat rate of 21%, the limitation of the tax deduction for net interest expense to 30% of adjusted taxable income (except for certain small businesses), the limitation of the deduction for net operating losses from taxable years beginning after December 31, 2017 to 80% of current year taxable income and the elimination of net operating loss carrybacks generated in taxable years ending after December 31, 2017 (though any such net operating losses may be carried forward indefinitely) and the modification or repeal of many business deductions and credits.

In addition, on March 27, 2020, former President Trump signed into law the “Coronavirus Aid, Relief, and Economic Security Act” or the CARES Act, which included certain changes in tax law intended to stimulate the U.S.

economy in light of the COVID-19 public health emergency, including providing temporary relief from certain aspects of the TCJA that had imposed limitations on the utilization of certain losses, interest expense deductions, and minimum tax credits and provided temporary deferral of certain payroll taxes.

It cannot be predicted whether, when, in what form or with what effective dates new tax laws may be enacted, or regulations and rulings may be enacted, promulgated or issued under existing or new tax laws, which could result in an increase in our or our shareholders’ tax liability or require changes in the manner in which we operate in order to minimize or mitigate any adverse effects of changes in tax law or in the interpretation thereof.

Our ability to use net operating losses to offset future taxable income may be subject to limitations.

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• announcements of dilutive financing;

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• announcements of additional potential reverse stock split;

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Future sales in the public market of shares of our common stock, including shares referred to in the foregoing risk factors or shares issued upon exercise of our outstanding stock options or warrants, or the perception by the market that these sales could occur, could lower the market price of our common stock or make it difficult for us to raise additional capital.

As of December 31, 2021, we had reserved for issuance 533,770 shares of our common stock issuable upon the exercise of outstanding stock options at a weighted-average exercise price of $10.09 per share, 200,280 shares of our common stock issuable upon the vesting of outstanding restricted stock units with a weighted average grant date fair value of $2.81 per share, and 518,858 shares of our common stock issuable upon the exercise of outstanding warrants at a weighted-average exercise price of $29.15 per share.

As of December 31, 2022, we had reserved for issuance 5,141,053 shares of our common stock issuable upon the exercise of outstanding warrants at a weighted-average exercise price of $5.37 per share, 1,039,483 shares of our common stock issuable upon the exercise of outstanding stock options at a weighted-average exercise price of $7.57 per share, and 255,136 shares of our common stock issuable upon the vesting of outstanding restricted stock units with a weighted average grant date fair value of $3.25 per share.

Upon exercise or conversion, the underlying shares, similar to those issued as the settlement payment, may be resold into the public market.

In the case of outstanding securities that have exercise or conversion prices that are below the market price of our common stock from time to time, our stockholders would experience dilution upon the exercise or conversion of these securities.

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In the case of

outstanding securities that have exercise or conversion prices that are below the market price of our common stock from time to time, our stockholders would experience dilution upon the exercise or conversion of these securities.

Certain of our securityholders have registration rights and they can require us, subject to certain limitations, to register their securities for resale and to maintain such registration.

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Section 203 could operate to delay or prevent a change of control of us.

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If our common stock becomes subject to the penny stock rules, it may be more difficult to sell our common stock.

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As a result, capital appreciation, if any, of our common stock will be our stockholders’ sole source of potential gain for the foreseeable future.

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UNRESOLVED STAFF COMMENTS

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

What changed 10-K

Item 1A. Risk Factors