Legal Proceedings.
−Removed: Securities Class Action Lawsuits and Derivative Actions
−Removed: Two putative class action lawsuits were filed against the Company and certain of its current and former officers in the United States District Court for the Eastern District of New York, one captioned Richard S.
−Removed: Spero Therapeutics, Inc., Ankit Mahadevia, and Satyavrat Shukla, Case No.
−Removed: 1:22-cv-03125, filed on May 26, 2022, and the other captioned Kashif Memon v.
−Removed: Spero Therapeutics, Inc., Ankit Mahadevia, and Satyavrat Shukla Case No.
−Removed: 1:22-cv-04154, filed on July 15, 2022.
−Removed: The parties moved to consolidate the two complaints on July 22, 2022, which were ordered consolidated on August 5, 2022 (“Consolidated Putative Class Action”).
−Removed: The parties filed an Amended Complaint on December 5, 2022, purported to be brought on behalf of stockholders who purchased our common stock from September 8, 2020 through May 2, 2022.
−Removed: The Amended Complaint generally alleges that the Company and certain of its current and former officers violated Sections 10(b) and/or 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder by making allegedly false and/or misleading statements concerning the NDA for tebipenem HBr in an effort to lead investors to believe that the drug would receive approval from the FDA.
−Removed: Plaintiffs seek unspecified damages, interest, attorneys’ fees, and other costs.
−Removed: The Company filed a fully-briefed Motion to Dismiss on June 21, 2023.
−Removed: By Order entered on September 30, 2024, the Motion to Dismiss was granted, dismissing the Amended Complaint in its entirety.
−Removed: The Court ordered the case to be closed by Memorandum and Order entered on October 28, 2024.
−Removed: A stockholder derivative action was filed against the Company, as nominal defendant, and certain of the Company's current and former officers in the United States District Court for the District of Delaware, captioned Marti v.
−Removed: Mahadevia, et al., Case.
−Removed: 1:23-cv-01133-RGA (the “First Derivative Complaint”), on October 11, 2023.
−Removed: The plaintiffs both purport to be current stockholders, and the allegations are primarily the same as those made in the Consolidated Putative Class Action.
−Removed: The First Derivative Complaint was transferred to the Eastern District of New York on November 13, 2023.
−Removed: A second stockholder derivative action was filed against the Company, as nominal defendant, and certain of its current and former officers in the Supreme Court of the State of New York, Kings County, captioned Heil v.
−Removed: Mahadevia, et al., Case.
−Removed: 505153/2024 (the “Second Derivative Complaint”), on February 21, 2024.
−Removed: The Second Derivative Complaint makes primarily the same allegations as the First Derivative Complaint, and the Consolidated Putative Class Action.
−Removed: The plaintiffs in both derivative suits agreed to a stay pending decision on the class action, subject to court approval.
−Removed: By Order entered on September 30, 2024, the motion to stay the First Derivative Complaint was denied as moot due to the dismissal of the Consolidated Putative Class Action.
−Removed: On March 20, 2025, the Second Derivative Complaint was voluntarily dismissed by the plaintiff.
−Removed: On March 31, 2025, the First Derivative Complaint was voluntarily dismissed by the plaintiff.
−Removed: Additional lawsuits against the Company and certain of its officers or directors may be filed in the future.
−Removed: If additional similar complaints are filed, absent new or different allegations that are material, the Company will not necessarily announce such additional filings.
SEC Investigation and Wells Notice
−Removed: On January 9, 2025, the Company responded to a “Wells Notice” from the Staff of the SEC regarding its preliminary determination to recommend a civil enforcement action or administrative proceeding against the Company, its former Chief Executive Officer and Chairman of the Board of Directors, Ankit Mahadevia, M.D., and its former Chief Financial Officer and President and Chief Executive Officer, Satyavrat “Sath” Shukla, relating to certain public disclosures by the Company from March 31, 2022 leading up to the Company’s announcement on May 3, 2022 that it had determined to cease commercialization of tebipenem HBr based on feedback from the FDA, and whether the Company’s disclosures may have violated the federal securities laws.
−Removed: Specifically, the contemplated civil enforcement action, if approved by the SEC Commissioners, could include allegations that the Company violated Section 17(a) of the Securities Act and Sections 10(b) and 13(a) of the Exchange Act and Rules 10b-5, 12b-20, and 13a-1 thereunder;
−Removed: and could allege against Dr.
−Removed: Mahadevia and Mr.
−Removed: Shukla violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rules 10b-5 and 13a-14 thereunder.
−Removed: The Company continues to cooperate with the SEC, has engaged in further dialogue with the Staff and maintains that the Company’s disclosures were appropriate.
+Added: On January 9, 2025, the Company responded to a “Wells Notice” from the Staff of the SEC regarding its preliminary determination to recommend a civil enforcement action or administrative proceeding against the Company, its former Chief Executive Officer and a former member of its Board of Directors, Ankit Mahadevia, M.D.
+Added: Mahadevia”), and its former Chief Financial Officer and President and Chief Executive Officer, Satyavrat “Sath” Shukla (“Mr.
+Added: Shukla”), relating to certain public disclosures by the Company from March 31, 2022 leading up to the Company’s announcement on May 3, 2022 that it had determined to cease commercialization of tebipenem HBr based on feedback from the FDA, and whether the Company’s disclosures may have violated the federal securities laws.
A Wells Notice is neither a formal charge of wrongdoing nor a final determination that the recipient has violated any law, but is a preliminary determination by the Staff to recommend to the SEC Commissioners that a civil enforcement action or administrative proceeding be brought against the recipients.
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If the SEC were to authorize an action against the Company and/or any of the identified individuals, it may seek an injunction or cease-and-desist order against future violations of provisions of the federal securities laws, the imposition of civil monetary penalties, disgorgement or other equitable relief.
+Added: On January 16, 2026, acting pursuant to an offer of settlement submitted by each of Dr.
+Added: Mahadevia and Mr.
+Added: Shukla, the SEC issued an order instituting cease-and-desist proceedings, making findings, and imposing a cease-and-desist order pursuant to Section 8A of the Securities Act, directing Dr.
+Added: Mahadevia and Mr.
+Added: Shukla to cease and desist from committing or causing any violations of Section 17(a)(2) of the Securities Act, 15 U.S.C.
+Added: § 77q(a)(2) (the “SEC Order”).
+Added: In the SEC Order, the SEC made findings that, from March 31, 2022 to May 3, 2022, Dr.
+Added: Mahadevia and Mr.
+Added: Shukla, violated Section 17(a)(2) of Securities Act, which provides that it is unlawful for any person, in the offer or sale of a security, to “obtain money or property by means of any untrue statement of material fact” or a material omission necessary to make statements made not misleading.
+Added: A violation of this provision does not require scienter and may rest on a finding of negligence.
+Added: Mahadevia and Mr.
+Added: Shukla consented to entry of the SEC Order without admitting or denying the findings contained therein, except as to jurisdiction.
+Added: On January 20, 2026, the Company received a letter (the “Letter”) from the SEC advising the Company that the SEC has concluded its investigation into the Company and that, based on the information as of the date of the Letter, the SEC does not intend to recommend an enforcement action against the Company at this time.
+Added: The Letter was provided under the guidelines set out in the final paragraph of Securities Act Release No.
+Added: The Company and Mr.
+Added: Shukla mutually decided to separate, and Mr.
+Added: Shukla resigned from the Board of Directors, in each case effective as of May 2, 2025.
+Added: On January 30, 2026, Dr.
+Added: Mahadevia resigned from the Board of Directors, including from his service on the Development Committee of the Board and from all officer and director positions he then held with any and all subsidiaries of the Company, effective as of January 30, 2026.
Ris k Factors.
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Risks Related to Product Development and Commercialization
−Removed: As of November 2025, we have ceased development of our SPR720 oral program and have shifted our focus and resources to advancing the clinical development of our tebipenem HBr program, as well as other corporate activities.
+Added: As of March 2025, we have ceased development of our SPR206 program, and as of November 2025, we have ceased development of our SPR720 oral program, and have shifted our focus and resources to advancing the development of the tebipenem HBr program, as well as other corporate activities.
Consequently, our business and prospects are substantially dependent on our tebipenem program and our collaboration with GSK.
−Removed: If we fail to execute successfully on this re-prioritized strategic focus, or our collaboration with GSK fails to advance the clinical development of the tebipenem HBr program, our business and prospects may be materially adversely affected.
−Removed: As of November 2025, we have ceased development of our SPR720 oral program and have shifted our focus and resources to advancing the clinical development of our tebipenem HBr program, as well as other corporate activities.
−Removed: Additionally, in March 2025, we announced that we ceased development of SPR206.
−Removed: We believe this re-prioritized strategic focus is the best way to optimize our financial and other resources to advance our goal of identifying and developing novel treatments for rare diseases and diseases caused by MDR bacterial infections with high unmet need.
+Added: If we fail to execute successfully on this re-prioritized strategic focus, or our collaboration with GSK fails to advance the development of the tebipenem HBr program, our business and prospects may be materially adversely affected.
+Added: As of March 2025, we have ceased development of SPR206.
+Added: Additionally, as of November 2025, we have ceased development of our SPR720 oral program and have shifted our focus and resources to advancing the clinical development of our tebipenem HBr program, as well as other corporate activities.
+Added: We believe this re-prioritized strategic focus is the best way to optimize our financial and other resources to advance our goal of identifying and developing novel treatments for rare diseases and diseases with high unmet need.
However, there is no assurance that we will successfully execute this strategy.
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As a result, we are currently substantially dependent on our tebipenem program and our collaboration with GSK.
−Removed: As described under Note 11 to our consolidated financial statements, GSK has the right to terminate the GSK License Agreement (1) at any time upon a specified number of days’ notice, (2) upon a material breach by us or (3) upon a bankruptcy of Spero.
+Added: As described under Note 9 to our condensed consolidated financial statements, GSK has the right to terminate the GSK License Agreement (1) at any time upon a specified number of days’ notice, (2) upon a material breach by us or (3) upon a bankruptcy of Spero.
Alternatively, in the case of a material breach by Spero, GSK may, in lieu of terminating the GSK License Agreement, elect to reduce any commercial milestone payments to Spero by 50%.
−Removed: In addition, in such circumstance, GSK may assume the responsibility and expense of development of tebipenem HBr in the United States, in which case no development milestone payments would be payable to Spero (including unpaid installments of any earned milestone payments).
+Added: In addition, in such circumstance, GSK may assume the responsibility and expense of development of tebipenem HBr in the United States, in which case no development milestone payments would be payable to Spero.
In the case of a Change of Control (as defined in the GSK License Agreement) of Spero, GSK similarly may, in lieu of terminating the GSK License Agreement, assume responsibility and expense of development of tebipenem HBr in the United States and no development milestones would be payable to Spero, as described above.
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Our ability to realize the value of tebipenem HBr depends on obtaining FDA approval.
−Removed: Even if such approval is obtained, the timeline of, and any requirements imposed as part of, such approval may impact the attractiveness of eventual commercialization of tebipenem HBr through our partnership with GSK.
+Added: Even if such approval is obtained, the timeline of, and any requirements imposed as part of, such approval may impact the attractiveness of commercialization of tebipenem HBr through our partnership with GSK.
We currently have no products approved for sale and have invested a significant portion of our efforts and financial resources in the development of tebipenem HBr as a product candidate for the treatment of bacterial infections causing cUTI.
−Removed: Our ability to realize the value of tebipenem HBr depends on the potential FDA approval, and the expected timeline and other requirements that would affect the attractiveness of eventual commercialization of tebipenem HBr through our partnership with GSK.
+Added: Our ability to realize the value of tebipenem HBr, currently our only product candidate, depends on the potential FDA approval, and the expected timeline and other requirements that would affect the attractiveness of commercialization of tebipenem HBr through our partnership with GSK.
Further, as part of any approval, the FDA could impose labeling requirements restricting the use of tebipenem HBr, which could reduce its commercial prospects, unless such requirements are subsequently modified to reduce such restrictions.
If any of these outcomes occur, our business could be materially harmed.
−Removed: If our clinical trials fail to produce favorable results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of any of our product candidates.
+Added: If our clinical trials fail to produce favorable results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of any existing and future product candidates.
We may not commercialize, market, promote or sell any product candidate in the United States without obtaining marketing approval from the FDA or in other countries without obtaining approvals from comparable foreign regulatory authorities, such as the European Medicines Agency (“EMA”), and we may never receive such approvals.
−Removed: We must complete extensive preclinical development and clinical trials to demonstrate the safety and efficacy of our product candidates in humans before we will be able to obtain these approvals.
+Added: We must complete extensive preclinical development and clinical trials to demonstrate the safety and efficacy of any product candidates in humans before we will be able to obtain these approvals.
Clinical testing is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome.
−Removed: The clinical development of any of our product candidates is susceptible to the risk of failure inherent at any stage of drug development, including failure to demonstrate efficacy in a trial or across a broad population of patients, the occurrence of severe adverse events, failure to comply with protocols or applicable regulatory requirements, and determination by the FDA or any comparable foreign regulatory authority that a drug product is not approvable.
+Added: The clinical development of any existing or future product candidates is susceptible to the risk of failure inherent at any stage of drug development, including failure to demonstrate efficacy in a trial or across a broad population of patients, the occurrence of severe adverse events, failure to comply with protocols or applicable regulatory requirements, and determination by the FDA or any comparable foreign regulatory authority that a drug product is not approvable.
A number of companies in the pharmaceutical industry, including biotechnology companies, have suffered significant setbacks in clinical trials, even after promising results in earlier nonclinical studies or clinical trials.
−Removed: The results of preclinical and other nonclinical studies and/or early clinical trials of our product candidates may not be predictive of the results of later-stage clinical trials.
+Added: The results of preclinical and other nonclinical studies and/or early clinical trials of any product candidates may not be predictive of the results of later-stage clinical trials.
Notwithstanding any promising results in early nonclinical studies or clinical trials, we cannot be certain that we will not face similar setbacks.
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Many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain marketing approval for the product candidates.
−Removed: Even if we believe that the results of our clinical trials warrant marketing approval, the FDA or comparable foreign regulatory authorities may disagree and may not grant marketing approval of our product candidates.
+Added: Even if we believe that the results of our clinical trials warrant marketing approval, the FDA or comparable foreign regulatory authorities may disagree and may not grant marketing approval of our existing or future product candidates.
In some instances, there can be significant variability in safety and/or efficacy results between different trials of the same product candidate due to numerous factors, including changes in trial procedures set forth in protocols, differences in the size and type of the patient populations, adherence to the dosing regimen and other trial protocols and the rate of dropout among clinical trial participants, among others.
−Removed: It is possible that even if one or more of our product candidates has a beneficial effect, that effect will not be detected during clinical evaluation as a result of one of the factors listed or otherwise.
+Added: It is possible that even if one or more of our existing or future product candidates has a beneficial effect, that effect will not be detected during clinical evaluation as a result of one of the factors listed or otherwise.
Conversely, as a result of the same factors, our clinical trials may indicate an apparent positive effect of a product candidate that is greater than the actual positive effect, if any.
−Removed: Similarly, in our clinical trials, we may fail to detect toxicity of or intolerability of our product candidates or may determine that our product candidates are toxic or not well tolerated when that is not in fact the case.
+Added: Similarly, in our clinical trials, we may fail to detect toxicity or intolerability of our existing or future product candidates or may determine that one of our existing or future product candidates are toxic or not well tolerated when that is not in fact the case.
In the case of our clinical trials, results may differ on the basis of the type of bacteria with which patients are infected.
−Removed: We cannot make assurances that any clinical trials that we may conduct will demonstrate consistent or adequate efficacy and safety to obtain regulatory approval to market our product candidates.
−Removed: We may encounter unforeseen events prior to, during, or as a result of, clinical trials that could delay or prevent us from obtaining regulatory approval for any of our product candidates, including:
+Added: We cannot make assurances that any clinical trials that we may conduct will demonstrate consistent or adequate efficacy and safety to obtain regulatory approval to market any product candidates.
+Added: We may encounter unforeseen events prior to, during, or as a result of, clinical trials that could delay or prevent us from obtaining regulatory approval for any product candidates, including:
• the FDA or other comparable foreign regulatory authorities may disagree as to the design or implementation of our clinical trials;
• we may be delayed in or fail to reach agreement on acceptable terms with prospective CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;
−Removed: • clinical trials of our product candidates may produce unfavorable or inconclusive results;
+Added: • clinical trials of any product candidates may produce unfavorable or inconclusive results;
• we may decide, or regulators may cause us, to conduct additional clinical trials or abandon product development programs;
−Removed: • the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate, participants may drop out of these clinical trials at a higher rate than we anticipate or we may fail to recruit suitable patients to participate in clinical trials;
−Removed: • our third-party contractors, including those manufacturing our product candidates or conducting clinical trials on our behalf, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all;
+Added: • the number of patients required for clinical trials of any product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate, participants may drop out of these clinical trials at a higher rate than we anticipate or we may fail to recruit suitable patients to participate in clinical trials;
+Added: • our third-party contractors, including those manufacturing any product candidates or conducting clinical trials on our behalf, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all;
• the FDA or institutional review boards may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site;
−Removed: • regulators or institutional review boards may require that we or our investigators suspend or terminate clinical trials of our product candidates for various reasons, including noncompliance with regulatory requirements or a finding that the participants are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics of the product candidate;
+Added: • regulators or institutional review boards may require that we or our investigators suspend or terminate clinical trials of any product candidates for various reasons, including noncompliance with regulatory requirements or a finding that the participants are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics of the product candidate;
• the FDA or comparable foreign regulatory authorities may fail to approve the manufacturing processes or facilities of third-party manufacturers with which we enter into agreements for clinical and commercial supplies;
−Removed: • the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient or inadequate;
+Added: • the supply or quality of any product candidates or other materials necessary to conduct clinical trials of any product candidates may be insufficient or inadequate;
• the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval.
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Such authorities may suspend or terminate a clinical trial due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or other regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a drug or changes in governmental regulations or administrative actions.
−Removed: If we are required to conduct additional clinical trials or other testing of any of our product candidates beyond the trials and testing that we contemplate, if we are unable to successfully complete clinical trials or other testing of our product candidates, if the results of these trials or tests are unfavorable or are only modestly favorable or if there are safety concerns associated with any of our product candidates, we may:
+Added: If we are required to conduct additional clinical trials or other testing of any existing or future product candidates beyond the trials and testing that we contemplate, if we are unable to successfully complete clinical trials or other testing of any existing or future product candidates, if the results of these trials or tests are unfavorable or are only modestly favorable or if there are safety concerns associated with any existing or future product candidates, we may:
• incur additional unplanned costs;
−Removed: • be delayed in obtaining marketing approval for our product candidates;
+Added: • be delayed in obtaining marketing approval for any product candidates;
• not obtain marketing approval at all;
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• be required to remove the product from the market after obtaining marketing approval.
−Removed: Our failure to successfully initiate and complete clinical trials of our product candidates and to demonstrate the efficacy and safety necessary to obtain regulatory approval to market any of our product candidates would significantly harm our business.
+Added: Our failure to successfully initiate and complete clinical trials of any product candidates and to demonstrate the efficacy and safety necessary to obtain regulatory approval to market any existing or future product candidates would significantly harm our business.
Our product candidate development costs will also increase if we experience delays in testing or marketing approvals and we may be required to obtain additional funds to complete clinical trials.
We cannot make assurances that our clinical trials will begin as planned or be completed on schedule, if at all, or that we will not need to restructure our trials after they have begun.
−Removed: Significant clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize our product candidates, which may harm our business and results of operations.
−Removed: In addition, many of the factors that cause, or lead to, delays of clinical trials may ultimately lead to the denial of regulatory approval of any of our product candidates.
+Added: Significant clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize any product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize any product candidates, which may harm our business and results of operations.
+Added: In addition, many of the factors that cause, or lead to, delays of clinical trials may ultimately lead to the denial of regulatory approval of any product candidates.
If we experience delays or difficulties in the enrollment of patients in clinical trials, clinical development activities could be delayed or otherwise adversely affected.
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Our inability to enroll a sufficient number of patients for our clinical trials would result in significant delays or might require us to abandon one or more clinical trials altogether.
−Removed: Enrollment delays in our clinical trials may result in increased development costs for any of our product candidates, slow down or halt our product candidate development and approval process and jeopardize our ability to seek and obtain the marketing approval required to commence product sales and generate revenue, which would cause the value of our company to decline and limit our ability to obtain additional financing if needed.
+Added: Enrollment delays in our clinical trials may result in increased development costs for any existing or future product candidates, slow down or halt our product candidate development and approval process and jeopardize our ability to seek and obtain the marketing approval required to commence product sales and generate revenue, which would cause the value of our company to decline and limit our ability to obtain additional financing if needed.
Congress also amended the Federal Food, Drug, and Cosmetic Act (“FDCA”) to require sponsors of a Phase 3 clinical trial, or other “pivotal study” of a new drug to support marketing authorization, to design and submit a diversity action plan (“DAP”) for such clinical trial.
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In the future, we will be required to submit a DAP to the FDA by the time we submit a Phase 3 clinical trial, or pivotal study, protocol to the agency for review, unless we are able to obtain a waiver for some or all of the requirements for a DAP.
−Removed: It is unknown at this time how the DAP may affect the planning and timing of any future Phase 3 clinical trial for our product candidates.
−Removed: However, initiation of such trials may be delayed if the FDA objects to our proposed DAPs for any future Phase 3 clinical trial for our product candidates, and we may experience difficulties recruiting a diverse population of patients in attempting to fulfill the requirements of any approved DAP.
+Added: It is unknown at this time how the DAP may affect the planning and timing of any future Phase 3 clinical trial for any product candidates.
+Added: However, initiation of such trials may be delayed if the FDA objects to our proposed DAPs for any future Phase 3 clinical trial for any product candidates, and we may experience difficulties recruiting a diverse population of patients in attempting to fulfill the requirements of any approved DAP.
In June 2024, as mandated by the FDCA, the FDA issued draft guidance outlining the general requirements for DAPs.
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Clinical trials may produce negative or inconclusive results, and we or any future collaborators may decide, or regulators may require us, to conduct additional clinical trials or preclinical studies.
−Removed: We will be required to demonstrate through well-controlled clinical trials that our product candidates are safe and effective for use in a diverse population before we can seek marketing approvals for their commercial sale.
+Added: We will be required to demonstrate through well-controlled clinical trials that our existing or future product candidates are safe and effective for use in a diverse population before we can seek marketing approvals for their commercial sale.
Success in preclinical studies and early-stage clinical trials does not mean that future larger registration clinical trials will be successful.
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As a result, analyses of interim and preliminary data should be viewed with caution until the analyses of final data are available.
−Removed: Adverse differences between preliminary or interim data and final data could affect our planned clinical path for any of our product candidates we advance into clinical trials, including potentially increasing cost and/or causing delay in such development.
+Added: Adverse differences between preliminary or interim data and final data could affect our planned clinical path for any product candidates we advance into clinical trials, including potentially increasing cost and/or causing delay in such development.
In some instances, there can be significant variability in safety and efficacy results between different clinical trials of the same product candidate due to numerous factors, including changes in trial protocols, differences in size and type of the patient populations, differences in and adherence to the dosing regimen and other trial protocols and the rate of dropout among clinical trial participants.
−Removed: We therefore do not know whether any clinical trials we may conduct will demonstrate consistent or adequate efficacy and safety sufficient to obtain marketing approval to market our product candidates.
−Removed: Serious adverse events or undesirable side effects or other unexpected properties of any of our product candidates may be identified during development or after approval that could delay, prevent or cause the withdrawal of regulatory approval, limit the commercial potential, or result in significant negative consequences following marketing approval.
−Removed: Serious adverse events or undesirable side effects caused by, or other unexpected properties of, our product candidates could cause us, an IRB, or regulatory authorities to interrupt, delay or halt our clinical trials and could result in a more restrictive label, the imposition of distribution or use restrictions or the delay or denial of regulatory approval by the FDA or comparable foreign regulatory authorities.
−Removed: If any of our other product candidates are associated with serious or unexpected adverse events or undesirable side effects, the FDA, the IRBs responsible for overseeing our studies, or a DSMB, could suspend or terminate our clinical trials or the FDA or comparable foreign regulatory authorities could order us to cease clinical trials or deny approval of our product candidates for any or all targeted indications.
+Added: We therefore do not know whether any clinical trials we may conduct will demonstrate consistent or adequate efficacy and safety sufficient to obtain marketing approval to market our existing or future product candidates.
+Added: Serious adverse events or undesirable side effects or other unexpected properties of any product candidates may be identified during development or after approval that could delay, prevent or cause the withdrawal of regulatory approval, limit the commercial potential, or result in significant negative consequences following marketing approval.
+Added: Serious adverse events or undesirable side effects caused by, or other unexpected properties of, our existing or future product candidates could cause us, an IRB, or regulatory authorities to interrupt, delay or halt our clinical trials and could result in a more restrictive label, the imposition of distribution or use restrictions or the delay or denial of regulatory approval by the FDA or comparable foreign regulatory authorities.
+Added: If any of our other product candidates are associated with serious or unexpected adverse events or undesirable side effects, the FDA, the IRBs responsible for overseeing our studies, or a DSMB, could suspend or terminate our clinical trials or the FDA or comparable foreign regulatory authorities could order us to cease clinical trials or deny approval of our existing or future product candidates for any or all targeted indications.
Treatment-related side effects could also affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims.
Any of these occurrences may harm our business, financial condition and prospects significantly.
−Removed: If unexpected adverse events occur in any of our ongoing or planned clinical trials, we may need to abandon development of our product candidates, or limit development to lower doses or to certain uses or subpopulations in which the undesirable side effects or other unfavorable characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective.
+Added: If unexpected adverse events occur in any of our ongoing or planned clinical trials, we may need to abandon development of any product candidates, or limit development to lower doses or to certain uses or subpopulations in which the undesirable side effects or other unfavorable characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective.
Many compounds that initially showed promise in clinical or earlier stage testing are later found to cause undesirable or unexpected side effects that prevented further development of the compound.
Undesirable side effects or other unexpected adverse events or properties of any of our other product candidates could arise or become known either during clinical development or, if approved, after the approved product has been marketed.
−Removed: If such an event occurs during development, our trials could be suspended or terminated and the FDA or comparable foreign regulatory authorities could order us to cease further development of, or could deny approval of our product candidates.
+Added: If such an event occurs during development, our trials could be suspended or terminated and the FDA or comparable foreign regulatory authorities could order us to cease further development of, or could deny approval of any product candidates.
If such an event occurs after such product candidates are approved, a number of potentially significant negative consequences may result, including:
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• we may be required to implement a risk evaluation and mitigation strategy (“REMS”), which may include the creation of a medication guide outlining the risks of such side effects for distribution to patients or restrictions on distribution or other elements;
−Removed: • we could be sued and held liable for harm caused to patients exposed to or taking our product candidates;
+Added: • we could be sued and held liable for harm caused to patients exposed to or taking our existing or future product candidates;
• our product may become less competitive;
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Even if a product candidate does obtain regulatory approval, it may never achieve the market acceptance by physicians, patients, hospitals, third-party payors and others in the medical community that is necessary for commercial success and the market opportunity may be smaller than we estimate.
−Removed: Even if we obtain FDA or other regulatory approvals and are able to launch any of our product candidates commercially, the approved product candidate may nonetheless fail to gain sufficient market acceptance among physicians, patients, hospitals (including pharmacy directors) and third-party payors and, ultimately, may not be commercially successful.
+Added: Even if we obtain FDA or other regulatory approvals and are able to launch any product candidates commercially, the approved product candidate may nonetheless fail to gain sufficient market acceptance among physicians, patients, hospitals (including pharmacy directors) and third-party payors and, ultimately, may not be commercially successful.
For example, physicians are often reluctant to switch their patients from existing therapies even when new and potentially more effective or convenient treatments enter the market.
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• the rate at which resistance to other drugs in the target infections grows.
−Removed: Any failure of any of our product candidates that obtains regulatory approval to achieve market acceptance or commercial success would adversely affect our business prospects.
+Added: Any failure of any product candidates that obtains regulatory approval to achieve market acceptance or commercial success would adversely affect our business prospects.
We may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success.
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If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to the product candidate.
−Removed: If we or our collaborators are unable to establish sales, marketing and distribution capabilities or enter into sales, marketing and distribution agreements with third parties, we may not be successful in commercializing any of our product candidates if such product candidates are approved.
+Added: If we or our collaborators are unable to establish sales, marketing and distribution capabilities or enter into sales, marketing and distribution agreements with third parties, we may not be successful in commercializing any product candidates if such product candidates are approved.
To achieve commercial success for any approved product, we must either develop a sales and marketing organization or outsource those functions to third parties.
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This may be costly, and our investment would be lost if we cannot retain or reposition our sales and marketing personnel.
−Removed: In addition, we may not be able to hire a sales force in the United States
−Removed: that is sufficient in size or has adequate expertise in the medical markets that we intend to target.
+Added: In addition, we may not be able to hire a sales force in the United States that is sufficient in size or has adequate expertise in the medical markets that we intend to target.
If we or our collaborators are unable to establish a sales force and marketing and distribution capabilities, our operating results may be adversely affected.
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In addition, we likely would have little control over such third parties, and any of them might fail to devote the necessary resources and attention to sell and market our products effectively.
−Removed: If we or our collaborators do not establish sales and marketing capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates.
+Added: If we or our collaborators do not establish sales and marketing capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing any product candidates.
+Added: If we engage in future acquisitions or strategic collaborations, this may increase our capital requirements, dilute our stockholders, cause us to incur debt or assume contingent liabilities and subject us to other risks.
+Added: We may evaluate various acquisitions and strategic collaborations, including licensing or acquiring complementary products, intellectual property rights, technologies or businesses.
+Added: Any potential acquisition or strategic collaboration may entail numerous risks, including:
+Added: • increased operating expenses and cash requirements;
+Added: • the assumption of additional indebtedness or contingent liabilities;
+Added: • assimilation of operations, intellectual property and products of an acquired company, including difficulties associated with integrating new personnel;
+Added: • the diversion of our management’s attention from any existing or future product candidates and initiatives in pursuing such acquisition or strategic collaboration;
+Added: • retention of key employees, the loss of key personnel and uncertainties in our ability to maintain key business relationships;
+Added: • risks and uncertainties associated with the other party to such a transaction, including the prospects of that party and their existing products or product candidates and regulatory approvals;
+Added: • our inability to generate revenue from acquired technology and/or products sufficient to meet our objectives in undertaking the acquisition or collaboration or even to offset transaction costs.
+Added: In addition, if we undertake acquisitions, we may issue dilutive securities, assume or incur debt obligations, incur large one-time expenses and acquire intangible assets that could result in significant future amortization expense.
+Added: Moreover, we may not be able to locate suitable acquisition or collaboration opportunities and this inability could impair our ability to grow or obtain access to technology or products that may be important to the development of our business.
We face substantial competition from other pharmaceutical and biotechnology companies and our operating results may suffer if we fail to compete effectively.
The development and commercialization of new drug products is highly competitive.
−Removed: We face competition from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide with respect to our product candidates that we may seek to develop and commercialize in the future.
+Added: We face competition from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide with respect to any product candidates that we may seek to develop and commercialize in the future.
There are a number of large pharmaceutical and biotechnology companies that currently market and sell products or are pursuing the development of product candidates for the treatment of resistant infections.
Potential competitors also include academic institutions, government agencies and other public and private research organizations.
−Removed: Our competitors may succeed in developing, acquiring or licensing technologies and drug products that are more effective or less costly than the product candidates that we are currently developing or that we may develop, which could render our product candidates obsolete and noncompetitive.
+Added: Our competitors may succeed in developing, acquiring or licensing technologies and drug products that are more effective or less costly than the product candidates that we are currently developing or that we may develop, which could render our existing or future product candidates obsolete and noncompetitive.
There are a variety of available oral therapies marketed for the treatment of cUTIs that we would expect would compete with tebipenem HBr, if approved, such as Levaquin, Cipro and Bactrim.
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This may make it difficult for tebipenem HBr to compete with these products.
−Removed: There are several IV-administered products marketed for the treatment of infections resistant to first-line therapy for Gram-negative infections, including Avycaz (ceftazidime-avibactam) from Allergan plc and Pfizer, Zerbaxa (ceftolozane-tazobactam) from Merck & Co., imipenem/cilastatin and Recarbrio (relebactam) from Merck & Co., Zemdri (plazomicin) from Cipla Therapeutics, Inc., Fetroja (cefiderocol) from Shionogi & Co.
−Removed: Ltd., and Vabomere (meropenem-vaborbactam) from CorMedix Inc., and Exblifep (cefepime/enmetazobactam) from Allecra Therapeutics.
+Added: There are several IV-administered products marketed for the treatment of infections resistant to first-line therapy for Gram-negative infections, including Emblaveo (Aztreonam-avibactam) from Allergan, Avycaz (ceftazidime-avibactam) from Allergan and Pfizer, Zerbaxa (ceftolozane-tazobactam) from Merck & Co., imipenem/cilastatin and Recarbrio (relebactam) from Merck & Co., Zemdri (plazomicin) from Cipla Therapeutics, Inc., Fetroja (cefiderocol) from Shionogi & Co.
+Added: Ltd., Vabomere (meropenem-vaborbactam) from CorMedix Inc., Exblifep (cefepime/enmetazobactam) from Allecra Therapeutics, and Contepo (fosfomycin) from Meitheal Pharmaceuticals.
Many of our competitors have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do.
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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 complementary to, or necessary for, our programs.
−Removed: Even if we or our partners are able to commercialize any of our product candidates, the product may become subject to unfavorable pricing regulations, or third-party payor coverage and reimbursement policies that could harm our business.
+Added: Even if we or our partners are able to commercialize our existing or future product candidates, the product may become subject to unfavorable pricing regulations, or third-party payor coverage and reimbursement policies that could harm our business.
Marketing approvals, pricing, coverage and reimbursement for new drug products vary widely from country to country.
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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, which may negatively affect the revenues that we are able to generate from the sale of the product in that country.
−Removed: 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.
−Removed: We currently expect that some of our product candidates, if approved, will be administered in a hospital inpatient setting.
+Added: Adverse pricing limitations may hinder our ability to recoup our investment in one or more product candidates, even if our existing or future product candidates obtain marketing approval.
+Added: We currently expect that our product candidate, if approved, will be administered in a hospital inpatient setting.
In the United States, governmental and other third-party payors generally reimburse hospitals a single bundled payment established on a prospective basis intended to cover all items and services provided to the patient during a single hospitalization.
Hospitals bill third-party payors for all or a portion of the fees associated with the patient’s hospitalization and bill patients for any deductibles or co-payments.
−Removed: Because there is typically no separate reimbursement for drugs administered in a hospital inpatient setting, some of our target customers may be unwilling to adopt our product candidates in light of the additional associated cost.
−Removed: If we are forced to lower the price we charge for our product candidates, if approved, our gross margins may decrease, which would adversely affect our ability to invest in and grow our business.
−Removed: To the extent any of our product candidates we develop are used in an outpatient setting, the commercial success of our product candidates will depend substantially, both domestically and abroad, on the extent to which coverage and reimbursement for these products and related treatments are available from government health programs and third-party payors.
−Removed: If coverage is not available, or reimbursement is limited, we may not be able to successfully commercialize our product candidates.
+Added: Because there is typically no separate reimbursement for drugs administered in a hospital inpatient setting, some of our target customers may be unwilling to adopt our product candidate in light of the additional associated cost.
+Added: If we are forced to lower the price we charge for our product candidate, if approved, our gross margins may decrease, which would adversely affect our ability to invest in and grow our business.
+Added: To the extent any product candidates we develop are used in an outpatient setting, the commercial success of our existing or future product candidates will depend substantially, both domestically and abroad, on the extent to which coverage and reimbursement for these products and related treatments are available from government health programs and third-party payors.
+Added: If coverage is not available, or reimbursement is limited, we may not be able to successfully commercialize our existing or future product candidates.
Even if coverage is provided, the approved reimbursement amount may not be high enough to allow us to establish or maintain pricing sufficient to realize a sufficient return on our investments.
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The healthcare industry is focused on cost containment, both in the United States and elsewhere.
−Removed: Government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications, which could affect our ability to sell our product candidates profitably.
+Added: Government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications, which could affect our ability to sell our existing or future product candidates profitably.
Increasingly, third-party payors are requiring higher levels of evidence of the benefits and clinical outcomes of new technologies and are challenging the prices charged.
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An inability to promptly obtain coverage and adequate payment rates from both government-funded and private payors for any approved products used on an outpatient basis 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.
−Removed: We cannot predict whether bacteria may develop resistance to our product candidates, if approved, which could affect their revenue potential.
−Removed: Certain of our product candidates are designed to treat bacterial infections, including drug-resistant infections.
+Added: We cannot predict whether bacteria may develop resistance to our product candidate, if approved, which could affect its revenue potential.
+Added: Tebipenem HBr is designed to treat bacterial infections, including drug-resistant infections.
The bacteria responsible for these infections evolve quickly and readily transfer their resistance mechanisms within and between species.
−Removed: We cannot predict whether or when bacterial resistance to any of such product candidates may develop.
+Added: We cannot predict whether or when bacterial resistance to tebipenem HBr may develop.
For example, as a carbapenem, tebipenem HBr is not active against organisms expressing a resistance mechanism mediated by enzymes known as carbapenemases.
Although occurrence of this resistance mechanism is currently rare, we cannot predict whether carbapenemase-mediated resistance will become widespread in regions where tebipenem HBr may be marketed if it is approved.
−Removed: The growth of drug-resistant infections in community settings or in countries with poor public health infrastructures, or the potential use of any of our product candidates outside of controlled hospital settings, could contribute to the rise of resistance.
−Removed: If resistance to any of our product candidates becomes prevalent, our ability to generate revenue from such product candidates could suffer.
+Added: The growth of drug resistant infections in community settings or in countries with poor public health infrastructures, or the potential use of our product candidate outside of controlled hospital settings, could contribute to the rise of resistance.
+Added: If resistance to our product candidate becomes prevalent, our ability to generate revenue could suffer.
If we are not successful in developing and commercializing additional product candidates, our ability to expand our business and achieve our strategic objectives would be impaired.
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• we may be unable to successfully modify candidate compounds to be active in Gram-negative bacteria or defeat bacterial resistance mechanisms or identify viable product candidates in our screening campaigns;
−Removed: • competitors may develop alternatives that render our product candidates obsolete;
+Added: • competitors may develop alternatives that render our existing or future product candidates obsolete;
• product candidates that we develop may nevertheless be covered by third parties’ patents or other exclusive rights;
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Product liability lawsuits against us could divert our resources, cause us to incur substantial liabilities and limit commercialization of any products that we may develop.
−Removed: We face an inherent risk of product liability claims as a result of the clinical testing of our product candidates despite obtaining appropriate informed consents from our clinical trial participants.
−Removed: We will face an even greater risk if we obtain marketing approval for and commercially sell any of our product candidates.
+Added: We face an inherent risk of product liability claims as a result of the clinical testing of any product candidates despite obtaining appropriate informed consents from our clinical trial participants.
+Added: We will face an even greater risk if we obtain marketing approval for and commercially sell any product candidates.
For example, we may be sued if any product that we develop allegedly causes injury or is found to be otherwise unsuitable during clinical testing, manufacturing, marketing or sale.
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Claims could also be asserted under state consumer protection acts.
−Removed: If we cannot successfully defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization of our product candidates.
+Added: If we cannot successfully defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization of any product candidates.
Regardless of the merits or eventual outcome, liability claims may result in:
• reduced resources for our management to pursue our business strategy;
−Removed: • decreased demand for our product candidates or products that we may develop;
+Added: • decreased demand for any product candidates or products that we may develop;
• injury to our reputation and significant negative media attention;
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The cost of any product liability litigation or other proceeding, even if resolved in our favor, could be substantial.
−Removed: We will need to increase our insurance coverage if and when we receive marketing approval for and begin selling any of our product candidates.
+Added: We will need to increase our insurance coverage if and when we receive marketing approval for and begin selling any product candidates.
In addition, insurance coverage is becoming increasingly expensive.
−Removed: If we are unable to obtain or maintain sufficient insurance coverage at an acceptable cost or to otherwise protect against potential product liability claims, it could prevent or inhibit the development and commercial production and sale of our product candidates, which could adversely affect our business, financial condition, results of operations and prospects.
+Added: If we are unable to obtain or maintain sufficient insurance coverage at an acceptable cost or to otherwise protect against potential product liability claims, it could prevent or inhibit the development and commercial production and sale of any product candidates, which could adversely affect our business, financial condition, results of operations and prospects.
If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse effect on our business.
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Such a loss could also expose us to regulatory enforcement, civil liability and reputational damage.
−Removed: To the extent that any disruption or cybersecurity incident results in a loss of or damage to our data or applications, or inappropriate disclosure or theft of confidential or proprietary information, in addition to incurring liability, the further development of our product candidates could be delayed or our competitive position could be compromised.
+Added: To the extent that any disruption or cybersecurity incident results in a loss of or damage to our data or applications, or inappropriate disclosure or theft of confidential or proprietary information, in addition to incurring liability, the further development of any product candidates could be delayed or our competitive position could be compromised.
Additionally, such disruptions or cybersecurity incidents could result in enforcement actions by U.S.
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In addition, other federal and state laws establish additional requirements for protecting the privacy and security of health information that is not protected by HIPAA.
−Removed: For instance, Washington state recently passed the “My Health My Data” Act, which came into force in 2024 and regulates “consumer health data,” which is defined as “personal information that is linked or reasonably linkable to a consumer and that identifies a consumer’s past, present, or future physical or mental health.” The “My Health My Data” Act provides exemptions for personal data used or shared in connection with certain research activities, including data subject to 45 C.F.R.
+Added: For instance, Washington state passed the “My Health My Data” Act in 2024 to regulate “consumer health data,” which is defined as “personal information that is linked or reasonably linkable to a consumer and that identifies a consumer’s past, present, or future physical or mental health.” The “My Health My Data” Act provides exemptions for personal data used or shared in connection with certain research activities, including data subject to 45 C.F.R.
Parts 46, 50 and 56.
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Despite our efforts, we may not have fully complied in the past and may not in the future.
−Removed: That could require us to incur significant expenses, which could significantly
−Removed: affect our business.
+Added: That could require us to incur significant expenses, which could significantly affect our business.
Failure to comply with data protection laws may expose us to risk of enforcement actions taken by data protection authorities or other regulatory agencies, private rights of action in some jurisdictions, and potential significant penalties if we are found to be non-compliant.
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Risks Related to Our Financial Position and Need for Additional Capital
−Removed: We have not generated any revenue from the sale of our products, have a history of losses and expect to incur substantial future losses.
+Added: We have not generated any revenue from the sale of our products, have a history of losses and expect to incur future losses.
If we are unable to obtain additional capital, we may not be able to continue our operations on the scope or scale as currently conducted, and that could have a material adverse effect on our business, results of operations and financial condition.
We have not generated any revenue from the sale of our products and have incurred losses in most years since our inception in 2013.
−Removed: Our net loss was $7.4 million and $22.9 million during the three and nine months ended September 30, 2025, respectively.
+Added: Our net loss was $7.2 million and $13.9 million for the three months ended March 31, 2026 and 2025, respectively.
We have yet to have a product candidate approved for sale and we may never have a product candidate approved for commercialization.
In accordance with ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), we have evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that these consolidated financial statements are issued.
−Removed: Based on our cash and cash equivalents as of September 30, 2025 and the decrease in clinical expense as a result of the completion of the PIVOT-PO Phase 3 trial for tebipenem HBr and the decision to cease development of SPR720, we believe that our cash runway will be sufficient to fund our operating expenses and required capital expenditures into 2028.
−Removed: During this period, we plan to prioritize finalizing the Phase 3 clinical trial activities for tebipenem HBr under our GSK License Agreement.
−Removed: Beyond this point, or in the event we change our current operating plan, we will need additional funding, which we expect will primarily consist of raising additional capital through some combination of equity or debt financings, potential new collaborations or additional grant funding.
+Added: Based on our current operating plan, we believe that our cash and cash equivalents as of March 31, 2026 will be sufficient to fund our operating expenses and capital expenditure requirements at least into 2028.
+Added: During this period, we remain focused on supporting GSK in the FDA approval process pursuant to our obligations under our GSK License Agreement and advancing other corporate activities, including exploring opportunities to grow our portfolio of clinical-stage product candidates.
+Added: Beyond this point, or in the event we change our current operating plan, we will need additional funding, which we expect will primarily consist of raising additional capital through some combination of equity or debt financings, potential new collaborations or grant funding.
If we are not able to secure adequate additional funding, we plan to make further reductions in spending.
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If we are unable to achieve commercialization, revenue from product sales, and, ultimately, profitability, the market value of our common stock will likely decline.
−Removed: We expect to continue to incur significant expenses and operating losses for the foreseeable future as we continue to advance our product candidates through preclinical and clinical development and marketing approval for such candidates whose clinical trials are successful.
+Added: We expect to continue to incur significant expenses and operating losses for the foreseeable future as we continue to advance our existing and future product candidates through preclinical and clinical development and marketing approval for such candidates whose clinical trials are successful.
Our expenses will also increase substantially if and as we:
−Removed: • conduct additional clinical trials and studies of our product candidates;
+Added: • conduct additional clinical trials and studies of our existing or future product candidates;
• continue to discover and develop additional product candidates;
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• acquire or in-license other product candidates and technologies.
−Removed: We currently have no products approved for sale and have historically invested a significant portion of our efforts and financial resources in the development of our product candidates, including tebipenem HBr, SPR206, and SPR720.
+Added: We currently have no products approved for sale and have historically invested a significant portion of our efforts and financial resources in the development of any of our product candidates, including tebipenem HBr, SPR206, and SPR720.
Although we decided to cease further development of SPR206 and SPR720, our business remains heavily dependent on the successful development, regulatory approval, and, if approved, commercialization of tebipenem HBr and any future product candidates.
We cannot be certain that any product candidate will receive regulatory approval or will be successfully commercialized even if it receives regulatory approval.
−Removed: If our product candidates fail to demonstrate safety and efficacy in clinical trials, do not gain regulatory approval, or do not achieve market acceptance following regulatory approval and commercialization, we may never become profitable.
+Added: If any of our product candidates fail to demonstrate safety and efficacy in clinical trials, do not gain regulatory approval, or do not achieve market acceptance following regulatory approval and commercialization, we may never become profitable.
Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods.
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Our expenses would increase if we are required by the FDA, or any comparable foreign regulatory authority to perform studies in addition to those currently expected, or if there are any delays in completing our clinical trials or the development of any of our product candidates.
−Removed: If we are unable to raise capital when needed, or do not receive payments under our government awards or from our commercial partnership agreements, it could limit our ability to support our operations and explore our growth strategy.
+Added: If we are unable to raise capital when needed, or do not receive payments from our collaboration partnership agreements, it could limit our ability to support our operations.
Developing pharmaceutical products, including conducting preclinical studies and clinical trials, is a time-consuming, expensive and uncertain process that takes years to complete.
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Our failure to raise capital as and when needed would have a negative effect on our financial condition and our ability to pursue our business strategy.
−Removed: Based on our cash and cash equivalents as of September 30, 2025, and the decrease in clinical expense as a result of the completion of the PIVOT-PO Phase 3 trial for tebipenem HBr and the decision to cease development of SPR720, we believe that our cash runway will be sufficient to fund our operating expenses and capital expenditures into 2028.
−Removed: During this period, we plan to prioritize finalizing the Phase 3 clinical trial activities for tebipenem HBr under our GSK License Agreement.
−Removed: Beyond this point, or in the event we change our current operating plan, we will need additional funding to support our continuing operations and explore our growth strategy.
+Added: Based on our current operating plan, we believe that our cash and cash equivalents as of March 31, 2026 will be sufficient to fund our operating expenses and capital expenditure requirements at least into 2028.
+Added: During this period, we remain focused on supporting GSK in the FDA approval process pursuant to our obligations under our GSK License Agreement and advancing other corporate activities, including exploring opportunities to grow our portfolio of clinical-stage product candidates.
+Added: Beyond this point, or in the event we change our current operating plan, we will need additional funding to support our continuing operations.
Until such time as we can generate significant revenue from product sales, if ever, we expect to finance our operations through a combination of equity offerings, debt financings, government funding arrangements, collaborations, strategic alliances and marketing, distribution or licensing arrangements.
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• the timing and terms of the potential FDA approval of tebipenem HBr;
−Removed: • the timing, costs and results of our ongoing, planned and potential clinical trials for our product candidates;
+Added: • the timing, costs and results potential clinical trials for any of our existing and future product candidates;
• the amount of funding that we receive under our government awards;
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• the outcome, timing and costs of seeking regulatory approvals;
−Removed: • the costs of commercialization activities for our product candidates if we receive marketing approval, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities;
+Added: • the costs of commercialization activities for our existing and future product candidates if we receive marketing approval, including the costs and timing of establishing product sales, marketing, distribution and manufacturing capabilities;
• the terms and timing of any future collaborations, licensing or other arrangements that we may establish;
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• the extent to which we in-license or acquire other products and technologies.
−Removed: Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates.
−Removed: Unless and until we can generate a substantial amount of revenue from our product candidates, we expect to finance our future cash needs through public or private equity offerings, debt financings, collaborations, licensing arrangements and government funding arrangements.
+Added: Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to any of our technologies or product candidates.
+Added: Unless and until we can generate a substantial amount of revenue from our existing and future product candidates, we expect to finance our future cash needs through public or private equity offerings, debt financings, collaborations, licensing arrangements and government funding arrangements.
In addition, we may seek additional capital due to favorable market conditions or strategic considerations, even if we believe that we have sufficient funds for our current or future operating plans.
−Removed: We filed the 2024 Form S-3 on March 15, 2024, which became effective on March 22, 2024 and pursuant to which we registered for sale up to $300.0 million of any combination of our common stock, preferred stock, debt securities, warrants, rights and/or units from time to time and at prices and on terms that we may determine, including up to $75.0 million of our common stock available for issuance pursuant to the Sales Agreement with Cantor.
+Added: We filed a universal shelf registration statement on Form S-3 (Registration No.
+Added: 333-277998) with the SEC on March 15, 2024, which became effective on March 22, 2024 and pursuant to which we registered for sale up to $300.0 million of any combination of our common stock, preferred stock, debt securities, warrants, rights and/or units from time to time and at prices and on terms that we may determine, including up to $75.0 million of our common stock available for issuance pursuant to the Controlled Equity Offering Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co.
Under the Sales Agreement, Cantor may sell shares of our common stock by any method permitted by law deemed to be an “at-the-market” offering as defined in Rule 415 of the Securities Act, subject to the terms of the Sales Agreement.
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In addition, debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include restrictive covenants that limit our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends, which could adversely affect our ability to conduct our business.
−Removed: In addition, securing additional financing would require a substantial amount of time and attention from our management and may divert a disproportionate amount of their attention away from day-to-day activities, which may adversely affect our management’s ability to oversee the development of our product candidates.
+Added: In addition, securing additional financing would require a substantial amount of time and attention from our management and may divert a disproportionate amount of their attention away from day-to-day activities, which may adversely affect our management’s ability to oversee the development of our existing or future product candidates.
If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams or product candidates or grant licenses on terms that may not be favorable to us.
We have a limited operating history and no history of commercializing pharmaceutical products, which may make it difficult to evaluate the prospects for our future viability.
−Removed: Our operations to date have been limited to financing and staffing our company, and performing research and development activities to advance our product candidates.
+Added: Our operations to date have been limited to financing and staffing our company, and performing research and development activities to advance our existing or future product candidates.
We have not yet demonstrated an ability to successfully obtain marketing approval, manufacture a commercial scale product, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization.
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The foreign NOLs do not expire.
+Added: As of December 31, 2025, we also had federal and state research and development tax credit carryforwards of $6.7 million and $1.7 million, respectively, and federal orphan drug tax credit carryforwards of $3.1 million, which may be available to offset future income tax liabilities.
+Added: The federal and state research and development tax credits begin to expire in 2035 and the federal orphan drug credits begin to expire in 2044.
Utilization of these NOLs depends on many factors, including our future income, which cannot be assured.
−Removed: Our NOLs, other than the NOLs that can be carried forward indefinitely, could expire unused and be unavailable to offset our future income tax liabilities.
−Removed: Any carryforwards that will expire prior to utilization were removed from deferred tax assets, with a corresponding reduction of the valuation allowance.
−Removed: In addition, under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (the "Code") and corresponding provisions of state law, if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50% change, by value, in its equity ownership by 5% stockholders over a three-year period, the corporation’s ability to use its pre-change NOLs and other pre-change tax attributes to offset its post-change income may be limited.
+Added: Other than the NOLs that can be carried forward indefinitely, our NOLs could expire unused and be unavailable to offset our future income tax liabilities.
+Added: In addition, under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code") and corresponding provisions of state law, if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50% change, by value, in its equity ownership by 5% stockholders over a three-year period, the corporation’s ability to use its pre-change NOLs to offset its post-change income may be limited.
We recently completed a Section 382 study and concluded that we underwent several ownership changes as defined by the Code, the last of which occurred during the year ended December 31, 2018.
+Added: Any NOL carryforwards that will expire prior to utilization have been removed from deferred tax assets, with a corresponding reduction of the valuation allowance.
Future ownership changes, some of which may be beyond our control, may limit our ability to utilize our tax attributes.
Under current U.S.
−Removed: federal tax legislation, NOLs arising in tax years beginning after December 31, 2017 may be used to offset only 80% of taxable income (although such NOLs may be carried forward indefinitely).
+Added: federal tax law, NOLs arising in tax years beginning after December 31, 2017 may be used to offset only 80% of taxable income (although such NOLs may be carried forward indefinitely).
Risks Related to Our Dependence on Third Parties
We may not achieve the milestones triggering payments to us in our existing, or any future, license and collaboration agreements with third parties.
−Removed: We have and may continue to seek third-party collaborators for development and commercialization of certain of our product candidates.
−Removed: Currently we are party to license and collaboration agreements with third parties as described in Note 11 to our consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q.
+Added: We have and may continue to seek third-party collaborators for development and commercialization of certain of our existing or future product candidates.
+Added: Currently we are party to license and collaboration agreements with third parties as described in Note 9 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q.
Our likely collaborators for any other marketing, distribution, development, licensing or broader collaboration arrangements we may pursue include large and mid-size pharmaceutical companies, regional and national pharmaceutical companies and biotechnology companies.
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We face significant competition in seeking and obtaining appropriate collaborators.
−Removed: Collaborations involving our product candidates may pose a number of risks, including the following:
+Added: Collaborations involving any of our existing or future product candidates may pose a number of risks, including the following:
• collaborators have significant discretion in determining the efforts and resources that they will apply to these collaborations;
• collaborators may not perform their obligations as expected;
−Removed: • collaborators may not pursue development and commercialization of our product candidates or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborators’ strategic focus or available funding or external factors, such as an acquisition, that divert resources or create competing priorities;
−Removed: • collaborators may not be able to develop, manufacture, market and sell our product candidates and use our intellectual property without infringing or misappropriating the intellectual property and other proprietary rights of third parties;
+Added: • collaborators may not pursue development and commercialization of any of our product candidates or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborators’ strategic focus or available funding or external factors, such as an acquisition, that divert resources or create competing priorities;
+Added: • collaborators may not be able to develop, manufacture, market and sell any of our product candidates and use our intellectual property without infringing or misappropriating the intellectual property and other proprietary rights of third parties;
• collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;
−Removed: • product candidates discovered in collaboration with us may be viewed by our collaborators as competitive with their own product candidates or products, which may cause collaborators to cease to devote resources to the commercialization of our product candidates;
+Added: • product candidates discovered in collaboration with us may be viewed by our collaborators as competitive with their own product candidates or products, which may cause collaborators to cease to devote resources to the commercialization of any of our product candidates;
• a collaborator with marketing and distribution rights to one or more products may not commit sufficient resources to the marketing and distribution of such product or products;
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We may have to alter our development and commercialization plans if we are not able to establish collaborations.
−Removed: We will require additional funds to complete the development and potential commercialization of our product candidates.
−Removed: For some of our product candidates, we may decide to collaborate with pharmaceutical and biotechnology companies for the development and potential commercialization of those product candidates.
−Removed: Moreover, we intend to utilize a variety of types of collaboration arrangements for the potential commercialization of our product candidates outside the United States.
+Added: We will require additional funds to complete the development and potential commercialization of our existing and future product candidates.
+Added: For any of our product candidates, we may decide to collaborate with pharmaceutical and biotechnology companies for the development and potential commercialization of those product candidates.
+Added: Moreover, we intend to utilize a variety of types of collaboration arrangements for the potential commercialization of our existing or future product candidates outside the United States.
Whether we reach a definitive agreement for a collaboration will depend, among other things, upon our assessment of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration and the proposed collaborator’s evaluation of a number of factors.
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If we elect to fund and undertake development or commercialization activities on our own, we may need to obtain additional expertise and additional capital, which may not be available to us on acceptable terms or at all.
−Removed: If we fail to enter into collaborations and do not have sufficient funds or expertise to undertake the necessary development and commercialization activities, we may not be able to further develop our product candidates or bring them to market and our business may be materially and adversely affected.
+Added: If we fail to enter into collaborations and do not have sufficient funds or expertise to undertake the necessary development and commercialization activities, we may not be able to further develop our existing and future product candidates or bring them to market and our business may be materially and adversely affected.
We rely on third parties to conduct all of our nonclinical studies and all of our clinical trials.
−Removed: If these third parties do not successfully carry out their contractual duties or meet expected deadlines, we may be unable to obtain regulatory approval for or commercialize any of our product candidates.
+Added: If these third parties do not successfully carry out their contractual duties or meet expected deadlines, we may be unable to obtain regulatory approval for or commercialize any product candidates.
If they do not perform satisfactorily, our business may be materially harmed.
We do not independently conduct nonclinical studies that comply with good laboratory practice (“GLP”) requirements.
−Removed: We also do not have the ability to independently conduct clinical trials of any of our product candidates.
−Removed: We rely on third parties, such as contract research organizations, clinical data management organizations, medical institutions and clinical investigators, to conduct our clinical trials of our product candidates and potential product candidates.
+Added: We also do not have the ability to independently conduct clinical trials of any product candidates.
+Added: We rely on third parties, such as contract research organizations, clinical data management organizations, medical institutions and clinical investigators, to conduct clinical trials of our existing and future product candidates and potential product candidates.
Any of these third parties may terminate their engagements with us at any time.
1 unchanged sentence
Our reliance on these third parties for clinical development activities limits our control over these activities but we remain responsible for ensuring that each of our studies is conducted in accordance with the applicable protocol, legal, regulatory and scientific standards.
−Removed: For example, notwithstanding the obligations of a contract research organization for a trial of one of our product candidates, we remain responsible for ensuring that each of our clinical trials is conducted in accordance with the general investigational plan and protocols for the trial and applicable regulatory requirements.
+Added: For example, notwithstanding the obligations of a contract research organization for a trial of any product candidates, we remain responsible for ensuring that each of our clinical trials is conducted in accordance with the general investigational plan and protocols for the trial and applicable regulatory requirements.
While we will have agreements governing their activities, we control only certain aspects of their activities and have limited influence over their actual performance.
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Although we rely on these third parties to conduct our GLP-compliant nonclinical studies and clinical trials, we remain responsible for ensuring that each of our nonclinical studies and clinical trials are conducted in accordance with applicable laws and regulations, and our reliance on the CROs does not relieve us of our regulatory responsibilities.
−Removed: The FDA and regulatory authorities in other jurisdictions also require us to comply with standards, commonly
−Removed: referred to as good clinical practices (“GCPs”) for conducting, monitoring, recording and reporting the results of clinical trials to assure that data and reported results are accurate and that the trial subjects are adequately informed of the potential risks of participating in clinical trials.
+Added: The FDA and regulatory authorities in other jurisdictions also require us to comply with standards, commonly referred to as good clinical practices (“GCPs”) for conducting, monitoring, recording and reporting the results of clinical trials to assure that data and reported results are accurate and that the trial subjects are adequately informed of the potential risks of participating in clinical trials.
The FDA enforces these GCPs through periodic inspections of trial sponsors, principal investigators, clinical trial sites and institutional review boards.
−Removed: If we or our third-party contractors fail to comply with applicable GCP standards, the clinical data generated in our clinical trials may be deemed unreliable and the FDA may require us to perform additional clinical trials before approving our product candidates, which would delay the regulatory approval process.
+Added: If we or our third-party contractors fail to comply with applicable GCP standards, the clinical data generated in our clinical trials may be deemed unreliable and the FDA may require us to perform additional clinical trials before approving any of our product candidates, which would delay the regulatory approval process.
We cannot make assurances that, upon inspection, the FDA will determine that any of our clinical trials comply with GCP.
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These contractors may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials or other drug development activities, which could impede their ability to devote appropriate time to our clinical programs.
−Removed: If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we may not be able to obtain, or may be delayed in obtaining, marketing approvals for our product candidates.
−Removed: If that occurs, we may not be able to, or may be delayed in our efforts to, successfully commercialize our product candidates.
−Removed: In such an event, our financial results and the commercial prospects for our product candidates could be harmed, our costs could increase and our ability to generate revenue could be delayed, impaired or foreclosed.
+Added: If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we may not be able to obtain, or may be delayed in obtaining, marketing approvals for any of our product candidates.
+Added: If that occurs, we may not be able to, or may be delayed in our efforts to, successfully commercialize any of our product candidates.
+Added: In such an event, our financial results and the commercial prospects for any of our product candidates could be harmed, our costs could increase and our ability to generate revenue could be delayed, impaired or foreclosed.
We also rely on other third parties to store and distribute drug supplies for our clinical trials.
−Removed: Any performance failure on the part of our distributors could delay clinical development or marketing approval of our product candidates or commercialization of any resulting products, producing additional losses and depriving us of potential product revenue.
−Removed: We contract with third parties for the manufacture of clinical supplies of tebipenem HBr and expect to continue to do so in connection with any future commercialization and for any future clinical trials and commercialization of any potential product candidates.
−Removed: This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.
−Removed: We do not currently have nor do we plan to build the internal infrastructure or capability to manufacture our product candidates for use in the conduct of our preclinical research, our clinical trials or for commercial supply.
−Removed: We currently rely on and expect to continue to rely on third-party contract manufacturers to manufacture supplies of our product candidates, and we expect to rely on third-party contract manufacturers to manufacture commercial quantities of any product candidate that we commercialize following approval for marketing by applicable regulatory authorities, if any.
+Added: Any performance failure on the part of our distributors could delay clinical development or marketing approval of any of our product candidates or commercialization of any resulting products, producing additional losses and depriving us of potential product revenue.
+Added: We contracted with third parties for the manufacture of clinical supplies of tebipenem HBr and expect to continue to do so in connection with any future clinical trials and commercialization of any potential product candidates.
+Added: This reliance on third parties increases the risk that we will not have sufficient quantities of our existing and future product candidates or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.
+Added: We do not currently have nor do we plan to build the internal infrastructure or capability to manufacture our existing or future product candidates for use in the conduct of our preclinical research, our clinical trials or for commercial supply.
+Added: We currently rely on and expect to continue to rely on third-party contract manufacturers to manufacture supplies of our existing or future product candidates, and we expect to rely on third-party contract manufacturers to manufacture commercial quantities of any product candidate that we commercialize following approval for marketing by applicable regulatory authorities, if any.
Reliance on third-party manufacturers entails risks, including:
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We do not have long-term agreements with any of these third parties.
−Removed: We also do not have any current contractual relationships for the manufacture of commercial supplies of any of our product candidates.
+Added: We also do not have any current contractual relationships for the manufacture of commercial supplies of any existing or future product candidates.
If any of our existing manufacturers should become unavailable to us for any reason, we may incur delays in identifying or qualifying replacements.
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Our manufacturer's facilities in Japan are located in seismically-active areas.
−Removed: If any of our product candidates are approved by any regulatory agency, we intend to enter into agreements with third-party contract manufacturers for the commercial production of those products.
−Removed: This process is difficult and time consuming and we may face competition for access to manufacturing facilities as there are a limited number of contract manufacturers operating under current good manufacturing practices (“cGMPs”) that are capable of manufacturing our product candidates.
+Added: If any existing or future product candidates are approved by any regulatory agency, we intend to enter into agreements with third-party contract manufacturers for the commercial production of those products.
+Added: This process is difficult and time consuming and we may face competition for access to manufacturing facilities as there are a limited number of contract manufacturers operating under current good manufacturing practices (“cGMPs”) that are capable of manufacturing our existing or future product candidates.
Consequently, we may not be able to reach agreement with third-party manufacturers on satisfactory terms, which could delay our commercialization.
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Facilities used by our third-party manufacturers must be approved by the FDA after we submit an NDA and before potential approval of the product candidate.
−Removed: Similar regulations apply to manufacturers of our product candidates for use or sale in foreign countries.
−Removed: We do not control the manufacturing process and are completely dependent on our third-party manufacturers for compliance with the applicable regulatory requirements for the manufacture of our product candidates.
+Added: Similar regulations apply to manufacturers of our existing or future product candidates for use or sale in foreign countries.
+Added: We do not control the manufacturing process and are completely dependent on our third-party manufacturers for compliance with the applicable regulatory requirements for the manufacture of our existing or future product candidates.
The inability or failure of our manufacturers to successfully manufacture material that conforms to the strict regulatory requirements of the FDA and any applicable foreign regulatory authority, may require us to find alternative manufacturing facilities, which could result in delays in obtaining approval for the applicable product candidate.
In addition, our manufacturers are subject to ongoing periodic unannounced inspections by the FDA and corresponding state and foreign agencies for compliance with cGMPs and similar regulatory requirements.
−Removed: Failure by any of our manufacturers to comply with applicable cGMPs or other regulatory requirements could result in sanctions being imposed on us, including fines, injunctions, civil penalties, delays, suspensions or withdrawals of approvals, operating restrictions, interruptions in supply and criminal prosecutions, any of which could significantly and adversely affect supplies of our product candidates and have a material adverse effect on our business, financial condition and results of operations.
−Removed: Our current and anticipated future dependence upon others for the manufacture of our product candidates and potential product candidates may adversely affect our future profit margins and our ability to commercialize any products for which we receive marketing approval on a timely and competitive basis.
−Removed: If we fail to comply with our obligations in the agreements under which we in-license or acquire development or commercialization rights to products, technology or data from or to third parties, we could lose rights that are important to our business.
−Removed: We are a party to agreements with Meiji and GSK for tebipenem HBr, and have legacy agreements with Vertex Pharmaceuticals for SPR720 and Pfizer, Everest and PBB Distributions Limited for SPR206, and we may enter into additional agreements, including license agreements, with other parties in the future that impose diligence, development and commercialization timelines, milestone payments, royalties, insurance and other obligations on us.
−Removed: For example, we have the Meiji License that gives us rights outside of the Meiji Territory to develop, manufacture, and commercialize tebipenem HBr as well as the right to use, cross-reference, file or incorporate by reference any information and relevant Meiji regulatory documentation to support any regulatory filings outside of the Meiji Territory.
+Added: Failure by any of our manufacturers to comply with applicable cGMPs or other regulatory requirements could result in sanctions being imposed on us, including fines, injunctions, civil penalties, delays, suspensions or withdrawals of approvals, operating restrictions, interruptions in supply and criminal prosecutions, any of which could significantly and adversely affect supplies of our existing or future product candidates and have a material adverse effect on our business, financial condition and results of operations.
+Added: Our current and anticipated future dependence upon others for the manufacture of our existing or future product candidates and potential product candidates may adversely affect our future profit margins and our ability to commercialize any products for which we receive marketing approval on a timely and competitive basis.
+Added: If we fail to comply with our obligations in the agreements under which we in-license or acquire development or commercialization rights to products, technology or data from or to third parties, we could lose such rights that are important to our business.
+Added: We are a party to agreements with Meiji and GSK for tebipenem HBr and we may enter into additional agreements, including license agreements, with other parties in the future that impose diligence, development and commercialization timelines, milestone payments, royalties, insurance and other obligations on us.
+Added: For example, the Meiji License gives us rights outside of the Meiji Territory to develop, manufacture, and commercialize tebipenem HBr as well as the right to use, cross-reference, file or incorporate by reference any information and relevant Meiji regulatory documentation to support any regulatory filings outside of the Meiji Territory.
In addition, we have the right to develop, manufacture and have manufactured tebipenem HBr in the Meiji Territory solely for the purpose of furthering development, manufacturing and commercialization of tebipenem HBr outside of the Meiji Territory.
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In addition, pursuant to our GSK License Agreement, we granted GSK an exclusive royalty-bearing license, with the right to grant sublicenses, under our intellectual property and regulatory documents and a sublicense under certain intellectual property of Meiji and Meiji’s regulatory documents to develop, manufacture and commercialize the GSK Licensed Products in the GSK Territory.
−Removed: Under the terms of the GSK License Agreement, we received an upfront payment of $66.0 million for GSK to secure rights to tebipenem pivoxil and tebipenem HBr, a $30.0 million milestone payment upon achievement of a development milestone in the third quarter of 2023, and are entitled to receive a $95.0 million development milestone payment that is payable in four equal semi-annual
−Removed: installments, of which we received $23.8 million in the first quarter of 2024, the third quarter of 2024, the first quarter of 2025 and the third quarter of 2025.
−Removed: Remaining potential payments under the GSK License Agreement are milestone based and are (i) $25.0 million for GSK’s submission of a NDA with the FDA for tebipenem HBr, (ii) up to $101.0 million in commercial milestone payments, and (iii) up to $225.0 million in sales milestone payments.
+Added: Under the terms of the GSK License Agreement, we received an upfront payment of $66.0 million for GSK to secure rights to tebipenem pivoxil and tebipenem HBr, a $30.0 million milestone payment upon achievement of a development milestone in the third quarter of 2023, and were entitled to receive a $95.0 million development milestone payment payable in four equal semi-annual installments, of which we received $23.8 million in each of the first quarter of 2024, the third quarter of 2024, the first quarter of 2025 and the third quarter of 2025 and a $25.0 million milestone for GSK’s submission of an NDA with the FDA for tebipenem HBr, which was received in February 2026.
+Added: Remaining potential payments under the GSK License Agreement are milestone based and are (i) up to $101.0 million in commercial milestone payments, and (ii) up to $225.0 million in sales milestone payments.
In addition to the milestones described above, GSK is obligated to pay royalties to us on annual net sales of GSK Licensed Products in the GSK Territory.
Such royalties are 1% for annual sales up to $750.0 million each year and range from high single-digit percentages on annual net sales above $750.0 million each year to low double-digit percentages on annual net sales above $1,000.0 million each year.
−Removed: We are responsible for the execution and costs of the follow-up Phase 3 clinical trial of tebipenem HBr.
−Removed: GSK is responsible for the execution and costs of additional further development, including Phase 3 regulatory filing and commercialization activities for tebipenem HBr in the balance of the GSK Territory outside of the United States.
−Removed: We will also be responsible for providing and paying for the clinical supply of tebipenem HBr while GSK will be responsible for the costs of the commercial supply of tebipenem HBr.
+Added: We were responsible for the execution and costs of the follow-up Phase 3 clinical trial of tebipenem HBr.
+Added: GSK is responsible for the execution and costs of additional further development, including commercialization activities for tebipenem HBr in the balance of the GSK Territory outside of the United States.
+Added: Additionally, we were responsible for providing and paying for the clinical supply of tebipenem HBr while GSK will be responsible for the costs of the commercial supply of tebipenem HBr.
If we fail to comply with our obligations to Meiji, GSK, or any of our other partners, our counterparties may have the right to terminate these agreements, in which event we might not be able to develop, manufacture or market any product candidate that is covered by these agreements, which could materially adversely affect the value of the product candidate being developed under any such agreement.
Termination of these agreements or reduction or elimination of our rights under these agreements may result in our having to negotiate new or reinstated agreements with less favorable terms or cause us to lose our rights under these agreements, including our rights to important intellectual property or technology.
−Removed: Risks Related to Our U.S.
−Removed: Government Contracts and to Certain Grant Agreements
−Removed: Our use of government funding for certain of our programs adds complexity to our research and commercialization efforts with respect to those programs and may impose requirements that increase the costs of commercialization and production of product candidates developed under those government-funded programs.
−Removed: We have received significant non-dilutive financing from various government agencies for the further development of our product candidates.
−Removed: Such funding sources may pose risks to us not encountered in other commercial contracts, including significant regulatory compliance risks.
−Removed: Contracts funded by the U.S.
−Removed: government and its agencies include provisions that reflect the government’s substantial public policy and compliance requirements, and substantial rights and remedies, many of which are not typically found in commercial contracts, including powers of the government to:
−Removed: • terminate agreements, in whole or in part, for any reason or no reason;
−Removed: • reduce or modify the government’s obligations under such agreements without the consent of the contractor;
−Removed: • claim rights, including intellectual property rights, in products and data developed under such agreements;
−Removed: • audit contract-related costs and fees, including allocated indirect costs;
−Removed: • suspend the contractor from receiving new contracts pending resolution of alleged violations of procurement laws or regulations;
−Removed: • impose U.S.
−Removed: manufacturing requirements for products that embody inventions conceived or first reduced to practice under such agreements;
−Removed: • suspend or debar the contractor or grantee from doing future business with the government;
−Removed: • control and potentially prohibit the export of products;
−Removed: • pursue criminal or civil remedies under the False Claims Act (the “FCA”), the False Statements Act and similar remedy provisions specific to government agreements.
−Removed: We may not have the right to prohibit the U.S.
−Removed: government from using certain technologies developed by us, and we may not be able to prohibit third-party companies, including our competitors, from using those technologies in providing products and services to the U.S.
−Removed: government generally takes the position that it has the right to royalty-free use of technologies that are developed under U.S.
−Removed: government contracts.
−Removed: In addition, government contracts and grants, and subcontracts and subawards awarded in the performance of those contracts and grants, normally contain additional requirements that may increase our costs of doing business, reduce our profits, and expose us to liability for failure to comply with these terms and conditions.
−Removed: These requirements include, for example:
−Removed: • specialized accounting systems unique to government awards;
−Removed: • mandatory financial audits and potential liability for price adjustments or recoupment of government funds after such funds have been spent;
−Removed: • public disclosures of certain award information, which may enable competitors to gain insights into our research program;
−Removed: • mandatory socioeconomic compliance requirements, including labor standards, anti-human-trafficking, non-discrimination and affirmative action programs, energy efficiency and environmental compliance requirements.
−Removed: If we fail to maintain compliance with these requirements, we may be subject to potential contract or FCA liability and to termination of our contracts.
−Removed: government agencies have special contracting requirements that give them the ability to unilaterally control our contracts.
−Removed: government contracts typically contain unfavorable termination provisions and are subject to audit and modification by the government at its sole discretion, which will subject us to additional risks.
−Removed: These risks include the ability of the U.S.
−Removed: government to unilaterally:
−Removed: • audit and object to our government contract-related costs and fees, and require us to reimburse all such costs and fees;
−Removed: • suspend or prevent us for a set period of time from receiving new contracts or extending our existing contracts based on violations or suspected violations of laws or regulations;
−Removed: • cancel, terminate or suspend our contracts based on violations or suspected violations of laws or regulations;
−Removed: • terminate our contracts if in the government’s interest, including if funds become unavailable to the applicable governmental agency;
−Removed: • reduce the scope and value of our contract;
−Removed: • change certain terms and conditions in our contract.
−Removed: government will be able to terminate any of its contracts with us, either for convenience or if we default by failing to perform in accordance with or to achieve the milestones set forth in the contract schedules and terms.
−Removed: Termination-for-convenience provisions generally enable us to recover only our costs incurred or committed and settlement expenses on the work completed prior to termination.
−Removed: Except for the amount of services received by the government, termination-for-default provisions do not permit these recoveries and would make us liable for excess costs incurred by the U.S.
−Removed: government in procuring undelivered items from another source.
−Removed: Our business is subject to audit by the U.S.
−Removed: government and other potential sources for grant funding, including under our contracts with BARDA and NIAID and a negative outcome in an audit could adversely affect our business.
−Removed: government agencies such as the Department of Health and Human Services (“DHHS”) and the Defense Contract Audit Agency (the “DCAA”) routinely audit and investigate government contractors.
−Removed: These agencies review a contractor’s performance under its contracts, cost structure and compliance with applicable laws, regulations and standards.
−Removed: The DHHS and the DCAA also review the adequacy of, and a contractor’s compliance with, its internal control systems and policies, including the contractor’s purchasing, property, estimating, compensation and management information systems.
−Removed: Any costs found to be improperly allocated to a specific contract will not be paid, while such costs already paid must be refunded.
−Removed: If an audit uncovers improper or illegal activities, we may be subject to civil and criminal penalties and administrative sanctions, including:
−Removed: • termination of contracts;
−Removed: • forfeiture of profits;
−Removed: • suspension of payments;
−Removed: • suspension or prohibition from conducting business with the U.S.
−Removed: In addition, we could suffer serious reputational harm if allegations of impropriety were made against us, which could cause our stock price to decrease.
−Removed: Laws and regulations affecting government contracts make it more expensive and difficult for us to successfully conduct our business.
−Removed: We must comply with numerous laws and regulations relating to the formation, administration and performance of government contracts, which can make it more difficult for us to retain our rights under our government contracts.
−Removed: These laws and regulations affect how we conduct business with government agencies.
−Removed: Among the most significant government contracting regulations that affect our business are:
−Removed: • the Federal Acquisition Regulations (the “FAR”) and agency-specific regulations supplemental to the FAR, which comprehensively regulate the procurement, formation, administration and performance of government contracts;
−Removed: • business ethics and public integrity obligations, which govern conflicts of interest and the hiring of former government employees, restrict the granting of gratuities and funding of lobbying activities and include other requirements such as the Anti-Kickback Statute and the Foreign Corrupt Practices Act;
−Removed: • export and import control laws and regulations;
−Removed: • laws, regulations and executive orders restricting the use and dissemination of information classified for national security purposes and the exportation of certain products and technical data.
−Removed: These requirements change frequently, such as through appropriations bills or executive orders.
−Removed: Any changes in applicable laws and regulations could restrict our ability to maintain our existing BARDA and other government contracts and obtain new contracts, which could limit our ability to conduct our business and materially adversely affect our results of operations.
−Removed: Provisions in our U.S.
−Removed: government contracts, including our contracts with BARDA, may affect our intellectual property rights.
−Removed: Certain of our activities have been funded, and may in the future be funded, by the U.S.
−Removed: government, including through our contracts with BARDA.
−Removed: When new technologies are developed with U.S.
−Removed: government funding, the government obtains certain rights in any resulting patents, including the right to a nonexclusive license authorizing the government to use the invention and rights that may permit the government to disclose our confidential information to third parties and to exercise “march-in” rights.
−Removed: The government can exercise its march-in rights if it determines that action is necessary because we fail to achieve practical application of the U.S.
−Removed: government-funded technology, because action is necessary to alleviate health or safety needs, to meet requirements of federal regulations or to give preference to U.S.
−Removed: In addition, U.S.
−Removed: government-funded inventions must be reported to the government, U.S.
−Removed: government funding must be disclosed in any resulting patent applications, and our rights in such inventions may be subject to certain requirements to manufacture products in the United States.
Risks Related to Our Intellectual Property
−Removed: If we are unable to obtain and maintain sufficient patent protection for our technology or our product candidates, or if the scope of the patent protection is not sufficiently broad, our competitors could develop and commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and product candidates may be adversely affected.
+Added: If we are unable to obtain and maintain sufficient patent protection for our technology or our existing or future product candidates, or if the scope of the patent protection is not sufficiently broad, our competitors could develop and commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and product candidates may be adversely affected.
Our success depends in large part on our ability to obtain and maintain patent protection in the United States and other countries with respect to our proprietary chemistry technology and product candidates.
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Even if we ultimately prevail in such claims, the monetary cost of such litigation and the diversion of the attention of our management and scientific personnel could outweigh any benefit we receive as a result of the proceedings.
−Removed: If we are sued for infringing intellectual property rights of third parties, or otherwise become involved in disputes regarding our intellectual property rights, such litigation could be costly and time consuming and could prevent or delay us from developing or commercializing our product candidates.
−Removed: Our commercial success depends, in part, on our ability to develop, manufacture, market and sell our product candidates and use our proprietary chemistry technology without infringing the intellectual property and other proprietary rights of third parties.
+Added: If we are sued for infringing intellectual property rights of third parties, or otherwise become involved in disputes regarding our intellectual property rights, such litigation could be costly and time consuming and could prevent or delay us from developing or commercializing our existing or future product candidates.
+Added: Our commercial success depends, in part, on our ability to develop, manufacture, market and sell our existing or future product candidates and use our proprietary chemistry technology without infringing the intellectual property and other proprietary rights of third parties.
Numerous third-party U.S.
issued patents and pending applications exist in the area of antibacterial treatment, including compounds, formulations, treatment methods and synthetic processes that may be applied towards the synthesis of antibiotics.
−Removed: If any of their patents or patent applications cover our product candidates or technologies, we may not be free to manufacture or market our product candidates as planned.
+Added: If any of their patents or patent applications cover our existing or future product candidates or technologies, we may not be free to manufacture or market our existing or future product candidates as planned.
There is a substantial amount of intellectual property litigation in the biotechnology and pharmaceutical industries, and we may become party to, or threatened with, litigation or other adversarial proceedings regarding intellectual property rights with respect to our technology or product candidates, including interference proceedings before the USPTO.
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In addition, we could be found liable for monetary damages, including treble damages and attorneys’ fees if we are found to have willfully infringed a patent.
−Removed: A finding of infringement could prevent us from commercializing our product candidates or force us to cease some of our business operations, which could materially harm our business.
+Added: A finding of infringement could prevent us from commercializing our existing or future product candidates or force us to cease some of our business operations, which could materially harm our business.
Claims that we or our third-party collaborators have misappropriated the intellectual property, confidential information or trade secrets of third parties could have a similar negative effect on our business.
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We have registered our trademarks for our name and logo in the United States and other countries and have a number of pending trademark applications in the United States and other countries.
−Removed: As of September 30, 2025, we have two registered U.S.
+Added: As of March 31, 2026, we have two registered U.S.
trademarks, 23 registered foreign trademarks, and no pending foreign trademark applications.
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We have also applied to register additional product candidate names as trademarks in the United States.
−Removed: When we file trademark applications for our product candidates, those applications may not be allowed for registration, and registered trademarks may not be obtained, maintained, or enforced.
+Added: When we file trademark applications for our existing or future product candidates, those applications may not be allowed for registration, and registered trademarks may not be obtained, maintained, or enforced.
During trademark registration proceedings in the United States and foreign jurisdictions, we may receive rejections.
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Risks Related to Regulatory Approval and Other Legal Compliance Matters
−Removed: If we are not able to obtain, or if there are delays in obtaining, required regulatory approvals, we will not be able to commercialize our product candidates, and our ability to generate revenue will be materially impaired.
−Removed: Our product candidates and the activities associated with their development and commercialization, including their design, testing, manufacture, safety, efficacy, recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution, are subject to comprehensive regulation by the FDA and other regulatory agencies in the United States and by comparable foreign regulatory authorities, with regulations differing from country to country.
+Added: If we or our collaboration partners are not able to obtain, or if there are delays in obtaining, required regulatory approvals, we will not be able to commercialize our existing and future product candidates, and our ability to generate revenue will be materially impaired.
+Added: Our existing or future product candidates and the activities associated with their development and commercialization, including their design, testing, manufacture, safety, efficacy, recordkeeping, labeling, storage, approval, advertising, promotion, sale and distribution, are subject to comprehensive regulation by the FDA and other regulatory agencies in the United States and by comparable foreign regulatory authorities, with regulations differing from country to country.
Failure to obtain marketing approval for a product candidate will prevent us from commercializing the product candidate.
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In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate’s clinical development and may vary among jurisdictions.
−Removed: obtained regulatory approval for any product candidate and it is possible that none of our product candidates we seek to develop in the future will ever obtain regulatory approval.
−Removed: Neither we nor any future collaborators are permitted to market any of our product candidates in the United States until we or they receive regulatory approval of an NDA from the FDA.
+Added: We have not obtained regulatory approval for any product candidate and it is possible that none of our existing or future product candidates we seek to develop in the future will ever obtain regulatory approval.
+Added: Neither we nor any future collaborators are permitted to market any existing or future product candidates in the United States until we or they receive regulatory approval of an NDA from the FDA.
In order to obtain approval to commercialize a product candidate in the United States or abroad, we or our collaborators must demonstrate to the satisfaction of the FDA or foreign regulatory agencies, that such product candidates are safe and effective for their intended uses.
Results from nonclinical studies and clinical trials can be interpreted in different ways.
−Removed: Even if we believe that the nonclinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities.
−Removed: The FDA may also require us to conduct additional nonclinical studies or clinical trials for our product candidates either prior to or post-approval, and it may otherwise object to elements of our clinical development program.
+Added: Even if we believe that the nonclinical or clinical data for any of our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities.
+Added: The FDA may also require us to conduct additional nonclinical studies or clinical trials for any of our product candidates either prior to or post-approval, and it may otherwise object to elements of our clinical development program.
An NDA must include extensive preclinical and clinical data and supporting information to establish the product candidate’s safety and efficacy for each desired indication.
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Obtaining marketing approval for marketing of a product candidate in one country does not ensure that we will be able to obtain marketing approval in other countries, but the failure to obtain marketing approval in one jurisdiction could negatively affect our ability to obtain marketing approval in other jurisdictions.
−Removed: The FDA or any foreign regulatory bodies can delay, limit or deny approval of our product candidates or require us to conduct additional nonclinical or clinical testing or abandon a program for many reasons, including:
+Added: The FDA or any foreign regulatory bodies can delay, limit or deny approval of any of our product candidates or require us to conduct additional nonclinical or clinical testing or abandon a program for many reasons, including:
• the FDA or the applicable foreign regulatory agency’s disagreement with the design or implementation of our clinical trials;
• negative or ambiguous results from our clinical trials or results that may not meet the level of statistical significance required by the FDA or comparable foreign regulatory agencies for approval;
−Removed: • serious and unexpected drug-related side effects experienced by participants in our clinical trials or by individuals using drugs similar to our product candidates;
−Removed: • our inability to demonstrate to the satisfaction of the FDA or the applicable foreign regulatory body that our product candidates are safe and effective for the proposed indication;
+Added: • serious and unexpected drug-related side effects experienced by participants in our clinical trials or by individuals using drugs similar to any of our product candidates;
+Added: • our inability to demonstrate to the satisfaction of the FDA or the applicable foreign regulatory body that any of our product candidates are safe and effective for the proposed indication;
• the FDA’s or the applicable foreign regulatory agency’s disagreement with the interpretation of data from nonclinical studies or clinical trials;
−Removed: • our inability to demonstrate the clinical and other benefits of our product candidates outweigh any safety or other perceived risks;
+Added: • our inability to demonstrate the clinical and other benefits of any of our product candidates outweigh any safety or other perceived risks;
• the FDA’s or the applicable foreign regulatory agency’s requirement for additional nonclinical studies or clinical trials;
−Removed: • the FDA’s or the applicable foreign regulatory agency’s disagreement regarding the formulation, labeling and/or the specifications for our product candidates;
+Added: • the FDA’s or the applicable foreign regulatory agency’s disagreement regarding the formulation, labeling and/or the specifications for any of our product candidates;
• the potential for approval policies or regulations of the FDA or the applicable foreign regulatory agencies to significantly change in a manner rendering our clinical data insufficient for approval.
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The lengthy review process as well as the unpredictability of future clinical trial results may result in our failing to obtain regulatory approval, which would significantly harm our business, financial condition, results of operations and prospects.
−Removed: Even if we eventually receive approval of an NDA or foreign marketing application for our product candidates, the FDA or the applicable foreign regulatory agency may grant approval contingent on the performance of costly additional clinical trials, often referred to as Phase 4 clinical trials, and the FDA may require the implementation of a REMS which may be required to ensure safe use of the drug after approval.
+Added: Even if we eventually receive approval of an NDA or foreign marketing application for any of our product candidates, the FDA or the applicable foreign regulatory agency may grant approval contingent on the performance of costly additional clinical trials, often referred to as Phase 4 clinical trials, and the FDA may require the implementation of a REMS which may be required to ensure safe use of the drug after approval.
The FDA or the applicable foreign regulatory agency also may approve a product candidate for a more limited indication or patient population than we originally requested, and the FDA or applicable foreign regulatory agency may not approve the labeling that we believe is necessary or desirable for the successful commercialization of a product candidate.
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A fast track designation may not actually lead to a faster development or regulatory review or approval process.
−Removed: We have received fast track designation for tebipenem HBr for the treatment of cUTI, including pyelonephritis, as well as fast track designation for SPR720 for treatment of adult patients with NTM-PD, and we may seek fast track designation for one or more of our other product candidates in the future.
+Added: We received fast track designation for tebipenem HBr for the treatment of cUTI, including pyelonephritis, and we may seek fast track designation for one or more of our future product candidates.
If a drug 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 drug sponsor may apply for fast track designation by the FDA for the particular indication under study.
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Fast track designation alone does not guarantee qualification for the FDA’s priority review procedures.
−Removed: Additionally, the FDA has designated tebipenem HBr as a Qualified Infectious Disease Product (“QIDP”) for the treatment of cUTI, community-acquired pneumonia (“CABP”) and diabetic foot infections (“DFI”) under the Generating Antibiotic Incentives Now (“GAIN”) Act.
+Added: Additionally, the FDA has designated tebipenem HBr as a Qualified Infectious Disease Product (“QIDP”) for the treatment of cUTI,
+Added: community-acquired pneumonia (“CABP”) and diabetic foot infections (“DFI”) under the Generating Antibiotic Incentives Now (“GAIN”) Act.
Among other benefits of a QIDP designation, the first marketing application for the QIDP-designated indication qualifies for priority review by the FDA.
−Removed: Further, if tebipenem HBr is approved for the treatment of cUTI, CABP or DFI, the FDA’s QIDP designation previously granted to tebipenem HBr for those indications will entitle the drug product to receive a one-time five-year extension to any non-patent exclusivity period awarded to tebipenem HBr in the United States, such as a five-year New Chemical Entity exclusivity granted under the Hatch-Waxman Act, among other possible periods of regulatory exclusivity that would qualify for a GAIN exclusivity extension.
+Added: Further, if tebipenem HBr is approved for the treatment of cUTI, the FDA’s QIDP designation previously granted to tebipenem HBr for this indication will entitle the drug product to receive a one-time five-year extension to any non-patent exclusivity period awarded to tebipenem HBr in the United States, such as a five-year New Chemical Entity exclusivity granted under the Hatch-Waxman Act, among other possible periods of regulatory exclusivity that would qualify for a GAIN exclusivity extension.
The QIDP designation for tebipenem HBr, however, does not guarantee a faster development process or ensure FDA approval.
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As with the FDA’s other programs for expediting review and approval of new drug products, even if we were to avail ourselves of this new program, there is no guarantee it would result in approval of our marketing applications or that such approval, if granted, would be on an expedited basis.
−Removed: While we have negotiated an SPA agreement with the FDA relating to our pivotal Phase 3 clinical trial of tebipenem HBr in patients with cUTI, including acute pyelonephritis, this agreement does not guarantee approval of tebipenem HBr or any other particular outcome from regulatory review of the clinical trial or the product candidate.
+Added: While we negotiated a SPA agreement with the FDA relating to our pivotal Phase 3 clinical trial of tebipenem HBr in patients with cUTI, including acute pyelonephritis, this agreement does not guarantee approval of tebipenem HBr or any other particular outcome from regulatory review of the clinical trial or the product candidate.
On July 31, 2023, the Company announced that it received written agreement from the FDA, under an SPA, on the design and size of PIVOT-PO, a pivotal Phase 3 clinical trial of tebipenem HBr in patients with cUTI, including acute pyelonephritis.
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If the FDA revokes or alters its agreement under the SPA, or interprets the data collected from the clinical trial differently than we do, the FDA may not deem the data sufficient to support an application for regulatory approval, which could materially adversely affect our business, financial condition and results of operations.
−Removed: We may seek orphan drug designation for one or more of our product candidates.
−Removed: We may not be able to obtain or maintain orphan drug designations for any of our product candidates, and we may be unable to take advantage of the benefits associated with orphan drug designation, including the potential for market exclusivity.
+Added: We may seek orphan drug designation for one or more of our future product candidates.
+Added: We may not be able to obtain or maintain orphan drug designations for any product candidates, and we may be unable to take advantage of the benefits associated with orphan drug designation, including the potential for market exclusivity.
Regulatory authorities in some jurisdictions, including the United States, may designate drugs for relatively small patient populations as orphan drugs.
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Orphan drug designation neither shortens the development time or regulatory review time of a drug, nor gives the drug any advantage in the regulatory review or approval process.
−Removed: The FDA and Congress may further reevaluate the Orphan Drug Act and its regulations and policies.
−Removed: This may be particularly true in light of a decision from the Court of Appeals for the 11th Circuit in September 2021.
−Removed: In Catalyst Pharms, Inc.
−Removed: Becerra (“Catalyst”), it was held that, for the purpose of determining the scope of orphan drug exclusivity, the term “same disease or condition” in the statute means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” Thus, the court concluded, orphan drug exclusivity applies to the entire designated disease or condition rather than the approved “indication or use.” Although there have been legislative proposals to overrule this decision, they have not been enacted into law.
−Removed: On January 23, 2023, the FDA announced that, in matters beyond the scope of the Catalyst court order, the FDA will continue to apply its existing regulations tying orphan-drug exclusivity to the uses or indications for which the orphan drug is approved.
−Removed: More recently however, on February 14, 2025, a federal district court in Washington, D.C.
−Removed: fully embraced the reasoning of the Catalyst decision in another decision challenging the scope of orphan drug exclusivity.
−Removed: On April 17, 2025, the FDA appealed this decision to the U.S.
+Added: The FDA and the U.S.
+Added: Congress may further reevaluate and revise the Orphan Drug Act and its regulations and policies.
+Added: For example, in September 2021, the Court of Appeals for the Eleventh Circuit held that, for the purpose of determining the scope of orphan drug exclusivity, the term “same disease or condition” means the designated “rare disease or condition” and not the “indication or use” for which the product is approved.
+Added: Subsequently, in another case, a federal district court in Washington, D.C.
+Added: followed the reasoning of the Eleventh Circuit decision and that decision was appealed to the U.S.
Court of Appeals for the D.C.
−Removed: The implications of this decision, and its impact on the FDA’s implementation of the Orphan Drug Act, are unclear at this point.
−Removed: If approved for commercial marketing in the United States, our product candidates may face generic competition sooner than anticipated.
+Added: On February 3, 2026, the Consolidated Appropriations Act of 2026 was enacted into law.
+Added: It overruled these court decisions and codified the FDA’s longstanding interpretation of the scope of orphan drug exclusivity to apply to “the same drug for the same approved use or indication within such [designated] rare disease or condition.” This change, which applies retroactively, expressly authorizes the FDA to approve multiple versions of the same orphan drug for different sub-indications and subpopulations, such as adult and pediatric patients or multiple variations of the same disease that are caused by different genetic variants.
+Added: If approved for commercial marketing in the United States, our existing or future product candidates may face generic competition sooner than anticipated.
Even if we are successful in achieving regulatory approval to commercialize a product candidate, it may face competition from generic products earlier or more aggressively than anticipated, depending upon how well our future products perform in the U.S.
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Future product candidates may also receive marketing exclusivity under the FDCA after approval that may similarly be subject to challenge or uncertainty.
−Removed: If we or our partners are unable to obtain marketing approval in international jurisdictions, we will not be able to market our product candidates abroad.
−Removed: In order to market and sell our product candidates in the European Union and many other jurisdictions, we or our partners must obtain separate marketing approvals and comply with numerous and varying regulatory requirements.
+Added: If we or our partners are unable to obtain marketing approval in international jurisdictions, we will not be able to market our existing or future product candidates abroad.
+Added: In order to market and sell our existing or future product candidates in the European Union and many other jurisdictions, we or our partners must obtain separate marketing approvals and comply with numerous and varying regulatory requirements.
Approval by the FDA does not ensure approval by regulatory authorities in other countries or jurisdictions, and approval by one regulatory authority outside the United States does not ensure approval by regulatory authorities in other countries or jurisdictions or by the FDA.
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In addition, clinical trials conducted in one country may not be accepted by regulatory authorities in other countries.
−Removed: Further, in April 2023, the European Commission issued a proposal to revise and replace the existing general pharmaceutical legislation.
−Removed: On June 4, 2025, after almost two years of negotiations among the EU Member States, the Council of the European Union adopted its position on the proposed overhaul of the EU general pharmaceutical legislative framework, which is known as the new Pharma Package.
−Removed: If adopted and implemented as currently proposed, these revisions will significantly change several aspects of drug development and approval in the European Union.
−Removed: The time required to obtain approval from regulatory authorities in other countries may differ substantially from that required to obtain FDA approval.
+Added: Moreover, the time required to obtain approval from regulatory authorities in other countries may differ substantially from that required to obtain FDA approval.
The regulatory approval process outside the United States generally includes all of the risks associated with obtaining FDA approval.
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We or our partners may not obtain approvals from regulatory authorities outside the United States on a timely basis or at all.
−Removed: Further, we could face heightened risks with respect to obtaining marketing authorization in the United Kingdom as a result of the withdrawal of the United Kingdom from the European Union, commonly referred to as Brexit.
+Added: In addition, the EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020.
+Added: The European Commission’s proposal for revision of several legislative instruments related to medicinal products, which may reduce the duration of regulatory data protection and exclusivity periods for orphan drugs, and revise the eligibility for expedited pathways in addition to other changes, was published on April 26, 2023.
+Added: On June 4, 2025, after almost two years of negotiations among the EU Member States, the Council of the EU adopted its position on the proposed overhaul of the EU general pharmaceutical legislative framework, which is known as the new Pharma Package.
+Added: On December 11, 2025, the European Parliament and European Council reached a provisional political agreement on the legislation.
+Added: The revisions may have a significant impact on the pharmaceutical industry and our business.
+Added: The new Pharma Package would, among other things, set a baseline period of eight years of data exclusivity and one year of market exclusivity with possible extensions for new indications up to a maximum of 11 years total.
+Added: The new framework is expected to be adopted by mid-2026 and there will likely be a transition period of 24 months, with the changes taking effect in mid-2028.
+Added: Additionally, we could face heightened risks with respect to obtaining marketing authorization in the United Kingdom as a result of the withdrawal of the United Kingdom from the EU, commonly referred to as Brexit.
The United Kingdom is no longer part of the European Single Market and EU Customs Union.
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requirements are based upon the now-repealed EU Clinical Trials Directive (2001/20/EC), which has been replaced by the European Clinical Trials Regulation (Regulation EU No 536/2014).
+Added: In anticipation of these new requirements, on October 1, 2025, the MHRA updated its guidance for clinical trials to address, among other things, research transparency requirements for clinical trials, the approvals process, the Research Ethics Committee review of clinical trials, simplified arrangements for consent in clinical trials and pharmacovigilance.
Since the United Kingdom left the EU prior to the date on which the EU CTR took effect, the U.K.
legal framework did not benefit from the same revisions as occurred at EU level.
−Removed: If we receive regulatory approval for any of our product candidates, we will be subject to ongoing obligations and continuing regulatory review, which may result in significant additional expense.
−Removed: Our product candidates, if approved, could be subject to restrictions or withdrawal from the market, and we may be subject to penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our product candidates, when and if approved.
−Removed: Any product candidate for which we obtain marketing approval will also be subject to ongoing regulatory requirements for labeling, packaging, storage, distribution, advertising, promotion, record keeping and submission of safety and other post-market
+Added: At the same time, a new international recognition procedure (“IRP”) will apply, which is intended to facilitate approval of pharmaceutical products in the United Kingdom.
+Added: The IRP is open to applicants that have already received an authorization for the same product from one of the MHRA’s specified Reference Regulators (“RRs”).
+Added: The RRs notably include the EMA and regulators in the EU/European Economic Area (“EEA”) member states for approvals in the EU centralized procedure and mutual recognition procedure as well as the FDA (for product approvals granted in the United States).
+Added: However, the concrete functioning of the IRP is currently unclear.
+Added: Any delay in obtaining, or an inability to obtain, any marketing approvals may force us or any of our future collaborators to restrict or delay efforts to seek regulatory approval in the United Kingdom for any product candidates, which could significantly and materially harm our business.
+Added: If we receive regulatory approval for any product candidates, we will be subject to ongoing obligations and continuing regulatory review, which may result in significant additional expense.
+Added: Our existing or future product candidates, if approved, could be subject to restrictions or withdrawal from the market, and we may be subject to penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our existing or future product candidates, when and if approved.
+Added: Any product candidate for which we obtain marketing approval will also be subject to ongoing regulatory requirements for labeling, packaging, storage, distribution, advertising, promotion, record keeping and submission of safety and other post-market information.
For example, approved products, manufacturers and manufacturers’ facilities are required to comply with extensive FDA requirements, including ensuring that quality control and manufacturing procedures conform to cGMPs.
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In addition, even if marketing approval of a product candidate is granted, the approval may be subject to limitations on the indicated uses for which the product may be marketed, may be subject to significant conditions of approval or may impose requirements for costly post-marketing testing and surveillance to monitor the safety or efficacy of the product.
−Removed: The FDA may also require a REMS as a condition of approval of our product candidates, which could include requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
+Added: The FDA may also require a REMS as a condition of approval of any of our product candidates, which could include requirements for a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
The FDA closely regulates the post-approval marketing and promotion of drugs to ensure that drugs are marketed only for the approved indications and in accordance with the provisions of the approved labeling and regulatory requirements.
The FDA also imposes stringent restrictions on manufacturers’ communications regarding off-label use and if we do not restrict the marketing of our products only to their approved indications, we may be subject to enforcement action for off-label marketing.
+Added: For example, on September 9, 2025, the President issued a Memorandum directing HHS to “ensure transparency and accuracy in direct-to-consumer (“DTC”) prescription drug advertising, including by increasing the amount of information regarding any risks associated with the use of any such prescription drug required to be provided in prescription drug advertisements.” To that end, the FDA announced that it is initiating a rulemaking process “to eliminate the ‘adequate provision’ loophole that allows pharmaceutical advertisements to hide safety information by placing it in another format or location.” In this context, the FDA declared that it will no longer tolerate what it characterized as “deceptive practices” in prescription drug advertising and that the agency would “aggressively deploy” its available enforcement tools, with “heightened scrutiny” of fair balance and disclosures in social media promotions.
+Added: The FDA also issued a generic “notice letter” directing companies to “remove any noncompliant advertising and bring all promotional communications into compliance.”
If a regulatory agency discovers previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility where the product is manufactured, or disagrees with the promotion, marketing or labeling of a product, it may impose restrictions on that product or us.
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• issue injunctions or impose civil or criminal penalties.
−Removed: The FDA’s policies may change and additional government regulations may be enacted that could prevent, limit or delay marketing approval of our product candidates.
+Added: The FDA’s policies may change and additional government regulations may be enacted that could prevent, limit or delay marketing approval of any of our product candidates.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.
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These laws and regulations include, for example, the false claims and anti-kickback statutes and regulations.
−Removed: time as we market, sell and distribute any products for which we obtain marketing approval and reimbursement, it is possible that our business activities could be subject to challenge under one or more of these laws and regulations.
+Added: At such time as we market, sell and distribute any products for which we obtain marketing approval and reimbursement, it is possible that our business activities could be subject to challenge under one or more of these laws and regulations.
Restrictions under applicable federal and state healthcare laws and regulations include the following:
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• the federal False Statements statute prohibits knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement in connection with the delivery of or payment for healthcare benefits, items or services;
−Removed: • the federal Physician Payments Sunshine Act requires manufacturers of drugs, devices, biologics and medical supplies covered by Medicare or Medicaid to report, on an annual basis, to the DHHS, information related to payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists, chiropractors and certain advanced non-physician health care practitioners), teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members;
+Added: • the federal Physician Payments Sunshine Act requires manufacturers of drugs, devices, biologics and medical supplies covered by Medicare or Medicaid to report, on an annual basis, to the HHS, information related to payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists, chiropractors and certain advanced non-physician health care practitioners), teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members;
• state and federal consumer protection laws, including the Federal Trade Commission Act, govern the collection, use, disclosure and protection of health and other personal information and could apply to our operations and the operations of our collaborators;
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The extent to which future legislation or regulations, if any, relating to healthcare fraud and abuse laws or enforcement, may be enacted or what effect such legislation or regulation would have on our business remains uncertain.
−Removed: Recently enacted and future policies and legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and may affect the reimbursement made for any product candidate for which we receive marketing approval.
+Added: Recently enacted and future policies and legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize any of our product candidates and may affect the reimbursement made for any product candidate for which we receive marketing approval.
The pricing and reimbursement environment may become more challenging due to, among other reasons, policies advanced by the presidential administration, federal agencies, new healthcare legislation passed by the U.S.
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The BCA caps the cuts to Medicare payments for items and services and payments to Part D plans at 2%.
−Removed: As long as these cuts remain in effect, they could adversely affect payment for our product candidates, if approved for commercial marketing.
−Removed: We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.
+Added: As long as these cuts remain in effect, they could adversely affect payment for any of our product candidates, if approved for commercial marketing.
+Added: We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for any of our product candidates or additional pricing pressures.
Moreover, there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products.
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they include diverse legislative proposals such as eliminating rebates;
−Removed: divorcing service fees from the price of a drug, discount, or rebate;
+Added: divorcing service fees from the price of a drug,
+Added: discount, or rebate;
prohibiting spread pricing;
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The controversy regarding the appropriateness of listing such patents has led to numerous lawsuits alleging anticompetitive conduct by biopharmaceutical companies.
−Removed: It remains to be seen whether the FTC under the Trump Administration will continue to prioritize the policy issue of “improper” patent listings or whether Congress may take any legislative actions related to this issue.
+Added: Currently, the FTC under the Trump Administration appears to be sticking to the prior administration’s policy of issuing warning letters for “improper” patent listings with a goal of enhancing competition between brand-name and generic pharmaceuticals in an effort to lower healthcare costs.
+Added: It remains to be seen whether Congress will take any legislative actions related to this issue.
Accordingly, regulatory and government interest in biopharmaceutical industry business practices continues to expand and pose a risk of uncertainty.
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With passage of the One Big Beautiful Bill Act on July 3, 2025, which was signed into law on July 4, 2025, Congress extended this exemption to drugs and biologics with multiple orphan drug designations.
−Removed: The first cycle of negotiations for the Medicare Drug Price Negotiation Program commenced in the summer of 2023.
−Removed: On August 15, 2024, DHHS published the results of the first Medicare drug price negotiations for ten selected drugs that treat a range of conditions, including diabetes, chronic kidney disease, and rheumatoid arthritis.
−Removed: The prices of these ten drugs will become effective January 1, 2026.
−Removed: On January 17, 2025, CMS announced its selection of 15 additional drugs covered by Part D for the second cycle of negotiations by February 1, 2025.
−Removed: While there had been some questions about the Trump administration’s position on this program, CMS issued a public statement on January 29, 2025, declaring that lowering the cost of prescription drugs is a top priority of the new administration and CMS is committed to considering opportunities to bring greater transparency in the negotiation program.
−Removed: The second cycle of negotiations with participating drug companies will occur during 2025, and any negotiated prices for this second set of drugs will be effective starting January 1, 2027.
+Added: The first cycle of negotiations for the Medicare Drug Price Negotiation Program commenced in the summer of 2023 with the negotiated prices for ten selected drug products becoming effective on January 1, 2026.
+Added: The second cycle of negotiations with participating drug companies occurred during 2025, and the negotiated prices for this second set of 15 drugs will become effective on January 1, 2027.
+Added: On January 27, 2026, CMS published the list of 15 drugs selected for the third cycle of negotiations.
+Added: These negotiated prices will become effective on January 1, 2028.
On June 6, 2023, Merck & Co.
−Removed: filed a lawsuit against DHHS and CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution.
−Removed: Subsequently, a number of other parties, including the U.S.
−Removed: Chamber of Commerce, Bristol Myers Squibb Company, the PhRMA, Astellas, Novo Nordisk, Janssen Pharmaceuticals, Novartis, AstraZeneca, Boehringer Ingelheim, and Teva also filed lawsuits in various courts with constitutional and Administrative Procedure Act claims against the DHHS and CMS.
−Removed: There have been various decisions by the courts considering these cases since they were filed.
−Removed: The DHHS has generally won the substantive disputes in these cases or succeeded in getting claims dismissed for lack of standing.
−Removed: Most of these cases are now on appeal.
−Removed: On October 30, 2024, the U.S.
−Removed: Court of Appeals for the Third Circuit heard oral argument in three of these cases.
−Removed: In April 2025, the U.S.
−Removed: Court of Appeals for the Second Circuit and the U.S.
−Removed: Court of Appeals for the Third Circuit heard argument in an additional three cases.
−Removed: On May 8, 2025, the Third Circuit rejected AstraZeneca’s challenge to the Medicare price negotiation program, finding that the program did not violate the company’s due process rights under the constitution since there is no protected property interest in selling goods to Medicare beneficiaries at a price higher than what the government is willing to pay in reimbursement.
−Removed: We expect that litigation involving these and other provisions of the IRA will continue, with unpredictable and uncertain results.
+Added: filed a lawsuit against HHS and CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution.
+Added: Subsequently, a number of other parties also filed lawsuits in various courts with similar constitutional claims.
+Added: HHS has generally won the substantive disputes in these cases or succeeded in getting claims dismissed for lack of standing or on the merits.
+Added: For example, on May 8, 2025, the U.S.
+Added: Court of Appeals for the Third Circuit rejected AstraZeneca L.P.’s challenge to the Medicare price negotiation program, finding that the program did not violate the company’s due process rights under the Constitution.
+Added: Litigation involving these and other provisions of the IRA will continue with unpredictable and uncertain results.
Accordingly, while it is currently unclear how the IRA will be effectuated, we cannot predict with certainty what impact any federal or state health reforms will have on us, but such changes could impose new or more stringent regulatory requirements on our activities or result in reduced reimbursement for our products, any of which could adversely affect our business, results of operations and financial condition.
−Removed: More recently, on April 15, 2025, President Trump issued an executive order which directs DHHS to take steps to reduce the prices of pharmaceutical products.
+Added: On April 15, 2025, President Trump issued an executive order which directs HHS to take steps to reduce the prices of pharmaceutical products.
The order repeats many of the proposals advanced during the first Trump Administration, including directing the FDA to streamline and improve its existing drug importation program so as to make it easier for states to obtain approval without sacrificing the safety or quality of drug products.
Other provisions of the order relate to the 340B program.
−Removed: Specifically, one provision calls on the Secretary of DHHS to determine the hospital acquisition cost for covered outpatient drugs at hospital outpatient departments and to consider and propose any appropriate adjustments for Medicare payment.
−Removed: The other provision directs DHHS to condition grant funding to certain health centers on those centers passing through the 340B discounts they receive on insulin and injectable epinephrine products to patients who meet certain requirements.
+Added: Specifically, one provision calls on the Secretary of HHS to determine the hospital acquisition cost for covered outpatient drugs at hospital outpatient departments and to consider and propose any appropriate adjustments for Medicare payment.
+Added: The other provision directs HHS to condition grant funding to certain health centers on those centers passing through the 340B discounts they receive on insulin and injectable epinephrine products to patients who meet certain requirements.
With respect to the IRA’s Medicare drug pricing program, the order, among other things, calls for alignment in “the treatment of small molecule prescription drugs with that of biological products, ending the distortion that undermines relative investment in small molecule prescription drugs, coupled with other reforms to prevent any increase in overall costs to Medicare and its beneficiaries.”
Further, on May 12, 2025, President Trump issued an additional executive order calling on pharmaceutical manufacturers to voluntarily reduce the prices of medicines in the United States.
−Removed: The Order directs the Secretary of DHHS to communicate most-favored-nation (“MFN”) price targets to pharmaceutical manufacturers to bring prices in line with comparably developed nations.
−Removed: The executive order further provides that if such actions do not lower the costs of pharmaceuticals, the Secretary of DHHS would pursue other actions, including proposing a rulemaking that imposes MFN pricing in the United States.
+Added: The Order directs the Secretary of HHS to communicate most-favored-nation (“MFN”) price targets to pharmaceutical manufacturers to bring prices in line with comparably developed nations.
+Added: The executive order further provides that if such actions do not lower the costs of pharmaceuticals, the Secretary of HHS would pursue other actions, including proposing a rulemaking that imposes MFN pricing in the United States.
Subsequently, on May 20, 2025, HHS indicated that the proposed MFN pricing will apply only to brand products without generic or biosimilar competition and the reference foreign countries will include only those in which the branded product similarly does not have generic or biosimilar competition.
−Removed: Second, DHHS indicated that the MFN target price will be the lowest price in a country that is a member of the Organisation for Economic Co-operation and Development (“OECD”) with a gross domestic product (“GDP”), per capita of at least 60% of the U.S.
+Added: Second, HHS indicated that the MFN target price will be the lowest price in a country that is a member of the Organisation for Economic Co-operation and Development (“OECD”) with a gross domestic product (“GDP”), per capita of at least 60% of the U.S.
GDP per capita.
1 unchanged sentence
The implications of these actions remain unclear and are likely to result in litigation if the administration pursues an MFN regulatory pricing requirement.
+Added: Thereafter, on July 31, 2025, President Trump issued letters to 17 pharmaceutical companies reiterating the requirements of the May 12, 2025, Executive Order and demanding that such companies extend MFN pricing to Medicaid patients, guarantee MFN pricing for newly-launched drug products, return increased revenues abroad to American patients and provide for direct purchasing at MFN pricing.
+Added: Since that time, virtually all of these pharmaceutical companies have entered into agreements with the administration to provide for lower prices on certain pharmaceuticals.
+Added: On February 5, 2026, President Trump launched TrumpRx.gov, a website that directs individuals to pharmaceutical manufacturer websites that are offering price discounts based on the administration’s pricing agreements with pharmaceutical manufacturers.
+Added: On December 23, 2025, CMS, through its Center for Medicare and Medicaid Innovation, proposed two five-year pilot programs to implement a “reference pricing” regime for drugs paid for under Medicare for 25% of covered beneficiaries.
+Added: The programs are referred to as the Global Benchmark for Efficient Drug Pricing Model for Medicare Part B drugs, referred to as GLOBE, and the Guarding U.S.
+Added: Medicare Against Rising Drug Costs for Medicare Part D drugs, referred to as GUARD.
+Added: Under the proposed pilot programs, a manufacturer would owe rebates to Medicare if prices for their drugs exceeded the prices paid by other economically comparable reference countries, defined in the proposed regulations as OECD countries with a GDP of $400 billion and a per capita GDP that is at least 60% of the U.S.
+Added: per capita GDP (an initial list of 19 reference countries is included in the proposed rule).
+Added: Comments are due on the proposed pilot program rules on or before February 23, 2026, and the pilot programs are proposed to go into effect beginning October 1, 2026.
At the state level, individual states are increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
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If we become subject to these reporting requirements, we will be liable for errors associated with our submission of pricing data, for failure to report pricing data in a timely manner, and for overcharging government payers, which can result in civil monetary penalties under the Medicaid statute, the federal civil False Claims Act, and other laws and regulations.
−Removed: Additionally, the 2021 Consolidated Appropriations Act signed into law on December 27, 2020 incorporated extensive healthcare provisions and amendments to existing laws, which includes a requirement that all manufacturers of drug products covered under Medicare Part B report the product’s average sales price to DHHS beginning on January 1, 2022, subject to enforcement via civil money penalties.
+Added: Additionally, the 2021 Consolidated Appropriations Act signed into law on December 27, 2020 incorporated extensive healthcare provisions and amendments to existing laws, which includes a requirement that all manufacturers of drug products covered under Medicare Part B report the product’s average sales price to HHS beginning on January 1, 2022, subject to enforcement via civil money penalties.
Increasingly there are state laws and regulations that require prescription drug price reporting or impose other restrictions designed to control pharmaceutical product pricing, such as price or patient reimbursement constraints and discounts.
8 unchanged sentences
These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements.
−Removed: Activities subject to these laws also involve the improper use or misrepresentation of information obtained in the course of clinical trials or creating fraudulent data in our preclinical studies or clinical trials, which could result in regulatory sanctions and
−Removed: serious harm to our reputation.
+Added: Activities subject to these laws also involve the improper use or misrepresentation of information obtained in the course of clinical trials or creating fraudulent data in our preclinical studies or clinical trials, which could result in regulatory sanctions and serious harm to our reputation.
It is not always possible to identify and deter misconduct by our employees and other third parties, 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.
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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, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished potential profits and future earnings, and curtailment of our operations, any of which could adversely affect our business, financial condition, results of operations or prospects.
−Removed: Disruptions at the FDA and other government agencies from funding cuts, personnel losses, regulatory reform, government shutdowns and other developments could hinder our ability to obtain guidance from the FDA regarding our clinical development program and develop and secure approval of our product candidates in a timely manner, which would negatively impact our business.
−Removed: The FDA and comparable regulatory agencies in foreign jurisdictions, such as the EMA and Committee for Medicinal Products for Human Use, play an important role in the development of our product candidates by providing guidance on our clinical development programs and reviewing our regulatory submissions, including INDs, requests for special designations and marketing applications.
−Removed: If these oversight and review activities are disrupted, then correspondingly our ability to develop and secure timely approval of our product candidates could be impacted in a negative manner.
−Removed: For example, the loss of FDA leadership and personnel could lead to disruptions and delays in FDA guidance, review and approval of our product candidates.
−Removed: Pursuant to President Trump’s Executive Order 14210, “Implementing the President’s ‘Department of Government Efficiency’ Workforce Optimization Initiative,” the Secretary of DHHS announced on March 27, 2025, a reorganization and Reduction in Force (“RIF”) across the Department of approximately 20,000 employees (82,000 to 62,000), with FDA’s workforce of approximately 20,000 to decrease by 3,500 full-time employees.
+Added: Disruptions at the FDA and other government agencies from funding cuts, personnel losses, regulatory reform, government shutdowns and other developments could hinder our ability to obtain guidance from the FDA regarding our clinical development program and develop and secure approval of any of our product candidates in a timely manner, which would negatively impact our business.
+Added: The FDA and comparable regulatory agencies in foreign jurisdictions, such as the EMA and Committee for Medicinal Products for Human Use, play an important role in the development of any of our product candidates by providing guidance on our clinical development programs and reviewing our regulatory submissions, including INDs, requests for special designations and marketing applications.
+Added: If these oversight and review activities are disrupted, then correspondingly our ability to develop and secure timely approval of any of our product candidates could be impacted in a negative manner.
+Added: For example, the loss of FDA leadership and personnel could lead to disruptions and delays in FDA guidance, review and approval of any of our product candidates.
+Added: Pursuant to President Trump’s Executive Order 14210, “Implementing the President’s ‘Department of Government Efficiency’ Workforce Optimization Initiative,” the Secretary of HHS announced on March 27, 2025, a reorganization and Reduction in Force (“RIF”) across the Department of approximately 20,000 employees (82,000 to 62,000), with FDA’s workforce of approximately 20,000 to decrease by 3,500 full-time employees.
Subsequently, the FDA indicated that roughly a quarter of those employees who received RIF notices had been reinstated.
On July 14, 2025, following litigation reaching the U.S.
−Removed: Supreme Court, the administration began to carry out these layoffs across DHHS, including the FDA.
−Removed: There are also ongoing deliberations within the administration and Congress over potentially substantial proposed cuts to the overall budget for DHHS and funding of the FDA for the 2026 federal fiscal year.
−Removed: While the FDA’s review of marketing applications and other activities for new drugs and biologics is largely funded through the user fee program established under the Prescription Drug User Fee Act (“PDUFA”), it remains unclear how the administration’s RIF and budget cuts will impact this program and the ability of the FDA to provide guidance and review our product candidates in a timely manner.
+Added: Supreme Court, the administration began to carry out these layoffs across HHS, including the FDA.
+Added: In November 2025, a Congressional Continuing Resolution ended the government shutdown, providing full-year funding for the FDA for Fiscal Year 2026 through September 30, 2026 at approximately $7 billion with a slight increase in user fees for drug and device companies.
+Added: While the FDA’s review of marketing applications and other activities for new drugs and biologics is largely funded through the user fee program established under the Prescription Drug User Fee Act (“PDUFA”), it remains unclear how the administration’s RIF and budget cuts will impact this program and the ability of the FDA to provide guidance and review any of our product candidates in a timely manner.
For example, while the FDA RIF did not reportedly specifically target FDA reviewers, many operations, administrative and policy staff that help support such reviews were affected and those losses could lead to delays in PDUFA reviews and related activities.
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eliminating agency information and resources for facilitating research activity;
−Removed: terminating federal agency procedures for authorizing international transactions;
+Added: delaying or terminating federal agency procedures for authorizing international transactions;
initiating aggressive enforcement actions that may disrupt the operations of major research universities that are significant contributors to life sciences research in the U.S., and threatening access to federal agency contracts and other funding awards based on companies’ otherwise lawful corporate policies and choice of counsel.
government actions could, directly or indirectly, significantly disrupt, delay, prevent, or increase the costs of our research and product commercialization programs, including our ability to develop new product candidates, conduct clinical trials, implement research collaborations with other companies or institutions, and obtain approvals to market and sell new products.
−Removed: In addition, government funding of the SEC and other government agencies on which our operations may rely, including those that fund research and development activities, is subject to the political process, which is inherently fluid and unpredictable.
−Removed: For example, over the last several years, the U.S.
−Removed: government has shut down several times and certain regulatory agencies, such as the FDA and the SEC, have had to furlough critical FDA, SEC and other government employees and stop critical activities.
−Removed: If a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions and could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.
+Added: In addition, government funding of the government agencies on which our operations may rely, including those that fund research and development activities, is subject to the political process, which is inherently fluid and unpredictable.
+Added: For example, the federal government shut down on October 1, 2025, and did not reopen for 43 days.
+Added: With the shutdown, the FDA issued a public notice stating that agency operations would continue to the extent permitted by law, such as activities necessary to address imminent threats to the safety of human life and activities funded by carryover user fee funds.
+Added: The FDA declared that, during the shutdown period, it did not have legal authority to accept user fees assessed for Fiscal Year 2026 until a Fiscal Year 2026 appropriation or Continuing Resolution for the FDA was enacted.
+Added: As a result, the FDA was not able to accept any regulatory submissions for Fiscal Year 2026 that required a fee payment and that was submitted during the lapse period.
+Added: In addition, the FDA indicated that some of its regulatory science research, crucial for advancing product innovation, safety, and quality, would be curtailed during the lapse period.
At the same time, disruptions at the FDA and other government agencies may result from public health events similar to the COVID-19 pandemic.
13 unchanged sentences
Changes in and uncertainty surrounding U.S.
−Removed: and international trade policies, particularly with respect to China, may adversely impact our business and operating results.
−Removed: This past spring, the U.S.
+Added: and international trade policies may adversely impact our business and operating results.
+Added: In the spring of 2025, the U.S.
government initiated a series of tariff-related actions against U.S.
trading partners.
−Removed: On April 2, 2025, President Trump issued an executive order announcing a “baseline” reciprocal tariff of 10% on all U.S.
+Added: On April 2, 2025, an executive order announced a “baseline” reciprocal tariff of 10% on all U.S.
trading partners effective April 5, 2025, and higher individualized reciprocal tariffs on 57 countries (with certain product exemptions for pharmaceutical-related products, among others).
−Removed: Previously, the Trump administration had imposed a 25% tariff on Canada and Mexico for goods not covered by the United States-Mexico-Canada Agreement (“USMCA”) and tariffs equaling 20% on China.
+Added: Previously, the U.S.
+Added: government had imposed a 25% tariff on Canada and Mexico for goods not covered by the United States-Mexico-Canada Agreement (“USMCA”) and tariffs due to drug trafficking equaling 20% on imports from China.
In response, several countries threatened retaliatory measures, including Canada and China, which then imposed retaliatory tariffs.
−Removed: Prior to when the country-specific reciprocal tariffs were scheduled to take effect, the Trump administration delayed the effective date of such tariffs for all countries except China to August 1, 2025.
+Added: Prior to when the country-specific reciprocal tariffs were scheduled to take effect, the U.S.
+Added: delayed the effective date of such tariffs for all countries except China to August 1, 2025.
Later, the United States and China reached a framework agreement that ultimately resulted in the suspension of the higher reciprocal tariffs on China until November 10, 2025.
−Removed: Since the April announcement, several countries including the European Union, Japan, South Korea and the United Kingdom, among others, have reached deals with the U.S.
+Added: Shortly before that expiration date, the United States and China reached a one-year agreement with an expiration of November 10, 2026, that includes the continued suspension of the heightened reciprocal tariffs on China and delayed enforcement of new U.S.
+Added: export rules targeting affiliates of blacklisted firms.
+Added: Since the April reciprocal tariffs announcement, the European Union, Japan, South Korea, Switzerland and the United Kingdom, among others, have reached deals with the U.S.
that include reduced tariff rates to varying levels and other measures.
−Removed: On July 31, 2025, President Trump issued an Executive Order detailing new reciprocal tariff rates for individual countries that took effect on August 7, 2025.
−Removed: The new reciprocal rates, which are consistent with the rates reflected in the trade deals already announced, range from 10% to 41%.
−Removed: The new rates do not apply to Canada, China, Mexico and a few other countries.
−Removed: For China, the 10% baseline reciprocal tariff announced in April remains in effect, in addition to a minimum of an additional 20%.
−Removed: Regarding Canada and Mexico, the rate remains 25% for goods that are not covered by the USMCA for Mexico and, effective August 1, 2025, was increased to 35% on imports from Canada that are not covered by the USMCA.
−Removed: Sustained uncertainty about, or the further escalation of, trade and political tensions between the United States and China could result in a disadvantageous research and manufacturing environment in China, particularly for U.S.
−Removed: based companies, including retaliatory restrictions that hinder or potentially inhibit our ability to rely on CMOs and other service providers that operate in China.
−Removed: Certain countries have reached agreements with the U.S.
−Removed: that cap pharmaceutical tariffs at 15%.
−Removed: These include the European Union, Japan, South Korea and the United Kingdom.
−Removed: Separately, in April 2025, the U.S.
−Removed: Department of Commerce initiated an investigation under Section 232 of the Trade Expansion Act of 1962 into the impact on U.S.
+Added: On July 31, 2025, the U.S.
+Added: administration issued an executive order detailing new reciprocal tariff rates for individual countries that took effect on August 7, 2025.
+Added: The deals with the European Union, Japan, South Korea, Switzerland (and Liechtenstein), the United Kingdom and others cap pharmaceutical tariffs at 15%.
+Added: In addition, an agreement with Malaysia provides a zero percent tariff exemption for pharmaceutical products that are not patented in the U.S.
+Added: and are used in pharmaceutical applications and an agreement with Switzerland and Lichenstein caps tariffs on pharmaceuticals imported from those two countries at 15%.
+Added: Finally, an agreement with Taiwan concluded on January 15, 2026 eliminates tariffs on generic pharmaceuticals and their active ingredients imported from Taiwan.
+Added: The reciprocal tariffs and the fentanyl tariffs were imposed pursuant to the International Emergency Economic Powers Act (the “IEEPA”).
+Added: These tariffs were found to be unconstitutional by multiple federal courts in the spring and summer of 2025.
+Added: On February 20, 2026, the Supreme Court held that IEEPA does not authorize the President to impose tariffs, invalidating both the reciprocal tariffs and the drug trafficking tariffs.
+Added: Shortly thereafter, the President issued a new Executive Order revoking the IEEPA tariffs and Customs and Border Protection ceased collecting the tariffs as of 12:01 am on February 24, 2026.
+Added: At the same time, however, the Trump Administration imposed a new 10% global tariff under Section 122 of the Trade Act of 1974, effective February 24, 2026.
+Added: Pursuant to the statute, absent an extension by Congress, these tariffs will expire in 150 days on July 24, 2026.
+Added: For those countries that have concluded trade deals with the United States, the tariff rates agreed to – including with regard to pharmaceuticals and pharmaceutical ingredients – have now reverted to 10% until July 24, 2026.
+Added: Like the IEEPA tariffs, pharmaceuticals and pharmaceutical ingredients are exempt from the Section 122 tariffs along with a list of other products.
+Added: The Administration has announced that it also plans to initiate new investigations on “most major trading partners” under Section 301 of the same act, which will likely lead to additional tariffs.
+Added: Neither the Supreme Court’s decision nor the Executive Order revoking the IEEPA tariffs addressed refunds, leaving the issue to renewed proceedings before the U.S.
+Added: Court of International Trade, where importers may need to pursue administrative remedies and/or litigation amid continued uncertainty.
+Added: Sustained uncertainty about, or the further escalation of, trade and political tensions between the United States and China could result in a disadvantageous research and manufacturing environment in China, particularly for U.S.-based companies, including retaliatory restrictions that hinder or potentially inhibit our ability to rely on CMOs and other service providers that operate in China.
+Added: Separately, in April 2025, the Department of Commerce initiated an investigation under Section 232 of the Trade Expansion Act of 1962 into the impact on U.S.
national security of the imports of pharmaceuticals and pharmaceutical ingredients, including finished drug products, medical countermeasures, critical inputs such as active pharmaceutical ingredients, and key starting materials, and derivative products of those items.
−Removed: On September 25, 2025, via a post on Truth Social, President Trump announced that, beginning October 1, 2025, all branded or patented drugs imported in the U.S.
+Added: On September 25, 2025, the U.S.
+Added: administration announced that, beginning October 1, 2025, all branded or patented drugs imported in the U.S.
would face a 100% tariff.
−Removed: At the same time, Trump indicated that these tariffs could be avoided by building pharmaceutical manufacturing facilities in the U.S.
−Removed: Thereafter, Trump delayed the October 1st effective date of the tariffs on branded or patented pharmaceutical products announcing that the Administration had now “begun preparing” tariffs on manufacturers that don’t build in the U.S.
−Removed: or enter into an MFN drug pricing agreement with the Trump administration.
+Added: At the same time, the administration indicated that these tariffs could be avoided by building pharmaceutical manufacturing facilities in the U.S.
+Added: Thereafter, the administration delayed the October 1, 2025 effective date of the tariffs on branded or patented pharmaceutical products announcing that the administration had now “begun preparing” tariffs on manufacturers that do not build in the U.S.
+Added: or enter into a most-favored-nation drug pricing agreement with the administration.
+Added: On April 2, 2026, President Trump issued a Proclamation invoking Section 232 of the Trade Expansion Act of 1962 to impose tariffs on imports of patented pharmaceuticals, biologics, and associated ingredients into the United States.
+Added: The action affects pharmaceutical manufacturers, importers, and supply chain participants.
+Added: Specifically, beginning July 31, 2026, a 100% tariff will apply to pharmaceutical articles that are subject to a valid, unexpired U.S.
+Added: patent and are listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations or are listed in the FDA’s Lists of Licensed Biological Products.
+Added: The 100% tariff also applies to active pharmaceutical ingredients and key starting materials for such articles.
+Added: Certain categories of products are exempt from these tariffs, including generic pharmaceuticals and biosimilars;
+Added: U.S.-origin pharmaceutical products, active pharmaceutical ingredients and key starting materials;
+Added: products classified in certain 10-digit tariff codes, listed in Annex IV of the Proclamation;
+Added: drugs and associated ingredients for all approved indications that are designated as orphan pursuant to the Orphan Drug Act;
+Added: drugs for certain specific uses, including nuclear medicines;
+Added: plasma-derived therapies;
+Added: fertility treatments;
+Added: cell and gene therapies;
+Added: antibody drug conjugates;
+Added: medical countermeasures related to chemical, biological, radiological, and nuclear threats;
+Added: animal health;
+Added: and other specialty pharmaceutical products to be later identified by the Secretary of Commerce;
+Added: and goods that qualify as “prototypes to be used exclusively for development, testing, product evaluation, or quality control purposes,” may be excluded from the additional tariffs.
As a result of changes in tariffs that have been announced and/or implemented, and the underlying uncertainty currently surrounding international trade, we could experience a negative impact to our costs of materials and production processes, and supply chain disruptions and delays as a result of any new tariff policies or trade restrictions.
−Removed: If we are unable to obtain necessary raw materials or product components in sufficient quantity and in a timely manner due to disruptions in the global supply chain caused by macroeconomic events and conditions, the development, testing and clinical trials of our product candidates may be delayed or infeasible, and regulatory approval or commercial launch of any resulting product may be delayed or not obtained, which could significantly harm our business.
−Removed: We cannot yet predict the effect of the recently imposed U.S.
+Added: If we are unable to obtain necessary raw materials or product components in sufficient quantity and in a timely manner due to disruptions in the global supply chain caused by macroeconomic events and conditions, the research, development, testing and clinical trials of any product candidates may be delayed or infeasible, and regulatory approval or commercial launch of any resulting product may be delayed or not obtained, which could significantly harm our business.
+Added: We cannot yet predict the effect of the U.S.
tariffs on imports, or the extent to which other countries will impose quotas, duties, tariffs, taxes or other similar restrictions upon imports or exports in the future, nor can we predict future trade policy or the terms of any renegotiated trade agreements and their impact on our business.
4 unchanged sentences
Although we have formal employment agreements with our executive officers, these agreements do not prevent them from terminating their employment with us at any time.
−Removed: In October 2024, we implemented a restructuring plan that reduced our workforce by approximately 39%.
−Removed: While we have confidence in our remaining employees, and our leadership team, including our current President, Chief Executive Officer and Chief Financial Officer, Ms.
−Removed: Rajavelu, who was appointed President and Chief Executive Officer effective as of May 2, 2025 following our separation with Mr.
−Removed: Shukla, the inherent uncertainty following this restructuring may cause concerns from third parties with whom we do business, and may increase the likelihood of turnover of other key officers and employees.
−Removed: Continued disruption caused by the transition or by the loss of ongoing services of any qualified scientific and management personnel could delay or prevent the successful development of our product candidates.
If we lose one or more of our named executive officers or key employees, our ability to implement our business strategy successfully could be seriously harmed.
28 unchanged sentences
• the success of existing or new competitive products or technologies;
−Removed: • the timing of clinical trials of our product candidates;
−Removed: • results of clinical trials of any of our product candidates;
+Added: • the timing of clinical trials of any of our product candidates;
+Added: • results of clinical trials of any existing or future product candidates;
• failure or discontinuation of any of our development programs;
4 unchanged sentences
• the recruitment or departure of key personnel;
−Removed: • the level of expenses related to any of our product candidates or clinical development programs;
+Added: • the level of expenses related to any existing or future product candidates or clinical development programs;
• the results of our efforts to develop, in-license or acquire additional product candidates or products;
12 unchanged sentences
This type of litigation could result, and has in the past resulted, in substantial costs and divert our management’s attention and resources, and could also require us to make substantial payments to satisfy judgments or to settle litigation.
−Removed: We have received a “Wells Notice” from the SEC contemplating a civil enforcement action, which could have a material adverse effect on our business, financial condition and results of operations, prospects, and/or our stock price.
−Removed: On January 9, 2025, we responded to the “Wells Notice” from the Staff of the SEC, as further described in Part II, Item 1 “Legal Proceedings” of this Quarterly Report on Form 10-Q.
−Removed: A Wells Notice is neither a formal charge of wrongdoing nor a final determination that the recipient has violated any law, but is a preliminary determination by the Staff to recommend to the SEC Commissioners that a civil enforcement action or administrative proceeding be brought against the recipients.
−Removed: If the SEC were to authorize an action against us and/or any of the identified individuals, it may seek an injunction or cease-and-desist order against future violations of provisions of the federal securities laws, the imposition of civil monetary penalties, disgorgement or other equitable relief within the SEC’s authority, or any combination of the foregoing.
−Removed: The SEC could also seek an order barring each identified individual from serving as an officer or director of a public company for a specified period of time.
−Removed: We are cooperating with the SEC and have made a submission in response to the Wells Notice explaining why an enforcement action would not be appropriate.
−Removed: We cannot predict the results of the Investigation and the Wells Notice process and any corresponding enforcement action against us and/or any of the identified individuals, and the costs, timing and other potential consequences of responding and complying therewith with any certainty.
−Removed: The Investigation, and the Wells Notice process continues to be expensive and disruptive, and we are subject to indemnifying each of the individuals for their costs associated with the Wells Notice s .
−Removed: Our insurance, to the extent maintained, may not cover all claims that may be asserted against us or the specified individuals, and we are unable to predict how long the Investigation will continue.
−Removed: An unfavorable outcome may have an adverse impact on our business, financial condition and results of operations, prospects, or our stock price.
−Removed: Any proceeding could also negatively impact our reputation among our stakeholders.
An active trading market for our common stock may not be sustained.
1 unchanged sentence
As a result, it may be difficult for our stockholders to sell their shares without depressing the market price for the shares, or at all.
−Removed: In the past, we have failed to maintain certain continued listing requirements of the Nasdaq GS and could fail to maintain those requirements again in the future, which could negatively affect the market price of our common stock, our liquidity and our ability to raise capital.
−Removed: Our potential failure to meet the continued listing requirements of Nasdaq GS in the future could result in the delisting of our common stock.
−Removed: Our common stock is listed on the Nasdaq GS, which imposes, among other requirements, a minimum $1.00 per share bid price requirement for continued inclusion on the Nasdaq GS pursuant to Nasdaq Listing Rule 5450(a)(1) (the “Bid Price Requirement”).
−Removed: The closing bid price for our common stock must remain at or above $1.00 per share to comply with the Bid Price Requirement for continued listing.
−Removed: On February 25, 2025, we received a deficiency letter (the “Notice”) from the Listing Qualifications Department of the Nasdaq Stock Market, LLC (“Nasdaq”) notifying us that, for the preceding 30 consecutive trading days, the closing bid price of our common stock was below the Bid Price Requirement.
−Removed: In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we had until August 25, 2025, to regain compliance with the Bid Price Requirement.
−Removed: On June 12, 2025, we received a letter from Nasdaq notifying us that the closing bid price of our common stock was at least $1.00 per share for a minimum of 10 consecutive trading days and that we had regained compliance with the Bid Price Requirement.
−Removed: Our common stock continues to be eligible for listing on the Nasdaq GS.
−Removed: There can be no assurance that we will be able to keep the closing bid price above $1.00 per share.
−Removed: If we fail to satisfy the continued listing requirements of Nasdaq GS, including the Bid Price Requirement, Nasdaq will provide us with another deficiency letter regarding the continued listing requirement.
−Removed: If we are unable to regain compliance with the Nasdaq Listing Rules in the future, Nasdaq will take steps to delist our common stock.
−Removed: Such a delisting from the Nasdaq GS could make trading our common stock more difficult for investors, potentially leading to declines in our share price and liquidity.
−Removed: If our common stock is delisted by the Nasdaq GS, our common stock may be eligible to trade on the Nasdaq Capital Market or an over-the-counter quotation system, where an investor may find it more difficult to sell our stock or obtain accurate quotations as to the market value of our common stock.
−Removed: We cannot assure you that our common stock, if delisted from the Nasdaq GS, will be listed on another national securities exchange or quoted on an over-the counter quotation system.
If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline.
11 unchanged sentences
In addition, political developments impacting government spending and international trade, including changes in trade agreements, trade disputes, tariffs and investment restrictions, such as the ongoing trade dispute between the United States and China, may negatively impact markets and cause weaker macroeconomic conditions.
−Removed: These global economic and political factors could also strain certain of our suppliers and manufacturers, possibly resulting in supply disruptions or increased raw material or manufacturing costs, or adversely impacting their ability to manufacture clinical trial materials for our product candidates.
+Added: These global economic and political factors could also strain certain of our suppliers and manufacturers, possibly resulting in supply disruptions or increased raw material or manufacturing costs, or adversely impacting their ability to manufacture clinical trial materials for any of our product candidates.
Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic and geopolitical climate and financial market conditions could adversely impact our business.
1 unchanged sentence
Our management has broad discretion in the application of our cash reserves and could spend these funds in ways that do not improve our results of operations or enhance the value of our common stock.
−Removed: The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our common stock to decline and delay the development of our product candidates.
+Added: The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our common stock to decline and delay the development of any of our product candidates.
Pending their use, we may invest our cash reserves in a manner that does not produce income or that loses value.
1 unchanged sentence
We are subject to Section 404 of The Sarbanes-Oxley Act of 2002 (“Section 404”) and the related rules of the SEC, which generally require our management and independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting.
−Removed: However, for so long as we remain a “smaller reporting company” (“SRC”) and non-accelerated filer, we intend to take advantage of certain exemptions from various reporting requirements, including, but not limited to, not being
−Removed: required to comply with the auditor attestation requirements of Section 404.
+Added: However, for so long as we remain a “smaller reporting company” (“SRC”) and non-accelerated filer, we intend to take advantage of certain exemptions from various reporting requirements, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404.
Once we do not meet the definition of a SRC and non-accelerated filer or, if prior to such date, we opt to no longer take advantage of the applicable exemption, we will be required to include an attestation report from our independent registered public accounting firm on the effectiveness of our internal controls over financial reporting.
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Provisions in our Amended and Restated Certificate of Incorporation, as amended, and Amended and Restated Bylaws may discourage, delay or prevent a merger, acquisition or other change in control of us that our stockholders may consider favorable, including transactions in which our stockholders might otherwise receive a premium for their shares.
−Removed: These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of
−Removed: our common stock.
+Added: These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of our common stock.
In addition, because our Board of Directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our Board of Directors.
32 unchanged sentences
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.