What changed in this filing

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Item 1A. Risk Factors

2021-08-04 compared with 2021-05-05 · 100 added, 91 removed, 961 unchanged (17% of the section changed)

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Inadequate reimbursement for such services may lead to physician resistance and limit our ability to market or sell our products.

Healthcare reform and other governmental and private payor initiatives may have an adverse effect upon, and could prevent commercial success of our products and product candidates.

government and individual states have aggressively pursued healthcare reform, as evidenced by the passing of the Healthcare Reform Act and the ongoing efforts to modify or repeal that legislation.

The Healthcare Reform Act substantially changed the way healthcare is financed by both governmental and private insurers and contains a number of provisions that affect coverage and reimbursement of drug products and/or that could potentially reduce the demand for pharmaceutical products such as increasing drug rebates under state Medicaid programs for brand name prescription drugs and extending those rebates to Medicaid managed care and assessing a fee on manufacturers and importers of brand name prescription drugs reimbursed under certain government programs, including Medicare and Medicaid.

Healthcare policy reform and other governmental and private payor initiatives may have an adverse effect upon, and could prevent commercial success of our products and product candidates.

government and individual states continue to aggressively pursue healthcare reform, as evidenced by efforts in recent years to modify or repeal the Affordable Care Act and ongoing attempts to control and/or lower the cost of prescription drugs and biologics.

The Affordable Care Act substantially changed the way healthcare is financed by both governmental and private insurers and contains a number of provisions that affect coverage and reimbursement of drug products and/or that could potentially reduce the demand for pharmaceutical products such as increasing drug rebates under state Medicaid programs for brand name prescription drugs and extending those rebates to Medicaid managed care and assessing a fee on manufacturers and importers of brand name prescription drugs reimbursed under certain government programs, including Medicare and Medicaid.

Other aspects of healthcare reform, such as expanded government enforcement authority and heightened standards that could increase compliance-related costs, could also affect our business.

Under the Trump Administration, a number of actions were taken to modify or repeal prior health reform and to implement additional health reform.

The Affordable Care Act has been subject to modification and additional modifications may occur.

There are, and may continue to be, judicial challenges to those efforts.

In addition, although President Biden supported reforms to lower drug prices during his campaign for presidency, the nature and scope of health reform action that may be taken under his administration remains uncertain.

We cannot predict the ultimate content, timing or effect of any changes to the Healthcare Reform Act or other federal and state reform efforts.

There is no assurance that federal or state health care reform will not adversely affect our future business and financial results, and we cannot predict how future federal or state legislative, judicial or administrative changes relating to healthcare reform will affect our business.

Legislative, Administrative, and private payor efforts to control drug costs span a range of proposals, including drug price negotiation, Medicare Part D redesign, drug price inflation rebates, international mechanisms, generic drug promotion and anticompetitive behavior, manufacturer reporting, and reforms that could impact therapies utilizing the accelerated approval pathway.

We cannot predict the ultimate content, timing or effect of any changes to the Affordable Care Act or other federal and state healthcare policy reform efforts including those aimed at drug pricing.

government, state legislatures and foreign governments have shown significant interest in implementing cost-containment programs to limit the growth of government-paid healthcare costs, including price controls, waiver from Medicaid drug rebate law requirements, restrictions on reimbursement and requirements for substitution of generic products for branded prescription drugs and the introduction of international reference pricing in the U.S.

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Our products may not be widely adopted by patients, payors or healthcare providers, which would adversely impact our potential profitability and future business prospects.

The commercial success of our products, particularly in the near term in the U.S., depends upon the level of market adoption by patients, payors and healthcare providers.

The commercial success of our products, particularly in the U.S., depends upon the level of market adoption by patients, payors and healthcare providers.

If our products do not achieve an adequate level of market adoption for any reason, or if market adoption does not persist, our potential profitability and our future business prospects will be severely adversely impacted.

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the actual and perceived efficacy and safety profile of our products, particularly if unanticipated adverse events related to our products’ treatment arise and create safety concerns among potential patients or prescribers or if new data and analyses we obtain for our products do not support, or are interpreted by some parties to not support, the efficacy of our products;

the efficacy and safety of our other exon-skipping product candidates and third parties’ competitive therapies.

the efficacy and safety of our other exon-skipping and gene therapy product candidates and third parties’ competitive therapies.

We may not be able to expand the global footprint of our products outside of the U.S.

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If this option is exercised, Roche will have sole control over and decision-making authority with respect to the commercialization of such products outside the U.S.

We cannot predict whether historical revenues from eteplirsen and golodirsen through our EAP outside the U.S.

will continue or whether we will be able to continue to distribute eteplirsen and golodirsen through our EAP.

We established a global EAP for eteplirsen, golodirsen and casimersen in countries where these products currently have not been approved.

We cannot predict whether historical revenues from eteplirsen, golodirsen and casimersen through our EAP outside the U.S.

will continue or whether we will be able to continue to distribute eteplirsen, golodirsen and casimersen through our EAP.

We established a global EAP for eteplirsen, golodirsen and casimersen in some countries where these products currently have not been approved.

While we generate revenue from the distribution of these products through our EAP, we cannot predict whether historical revenues from this program will continue, whether we will be able to continue to distribute our products through our EAP, or whether revenues will exceed revenues historically generated from sales through our EAP.

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Even if a healthcare provider is interested in obtaining access to our products for its patient through the EAP, the patient will not be able to obtain access to our products if funding for the drug is not secured.

Any failure to maintain revenues from sales of eteplirsen, golodirsen and casimersen through our EAP and/or to generate revenues from commercial sales of these products exceeding historical sales through our EAP could have a material adverse effect on our business, financial condition, results of operations and growth prospects.

Any failure to maintain revenues from sales of eteplirsen, golodirsen or casimersen through our EAP and/or to generate revenues from commercial sales of these products exceeding historical sales through our EAP could have a material adverse effect on our business, financial condition, results of operations and growth prospects.

If we are unable to successfully maintain and further develop internal commercialization capabilities, sales of our products may be negatively impacted.

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While orphan status for any of our products, if granted or maintained, would provide market exclusivity for the time periods specified above upon approval, we would not be able to exclude other companies from obtaining regulatory approval of products using the same or similar active ingredient for the same indication during or beyond the exclusivity period applicable to our product on the basis of orphan drug status (e.g., seven years in the U.S.).

For example, the exclusivity period for EXONDYS 51 will end in September 2023.

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

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, product profitability exceeds the criteria for orphan drug designation), problems with the production or supply of the orphan drug, or a competitor drug, although similar, is safer, more effective or otherwise clinically superior than the initial orphan drug.

Thus, other companies may have received, or could receive, approval to market a product candidate that is granted orphan drug exclusivity for the same drug or similar drug and same orphan indication as any of our product candida tes for which we plan to file an NDA , BLA or MAA .

If that were to happen, our prior approved orphan product s may face competition and any pending NDA , BLA or MAA for our product candidate for that indication may not be approved until the competing company’s period of exclusivity has expired in the U.S.

If that were to happen, our prior approved orphan products may face competition and any pending NDA, BLA or MAA for our product candidate for that indication may not be approved until the competing company’s period of exclusivity has expired in the U.S.

or the EU, as applicable.

For example, in January 2020, the FDA issued a draft guidance to clarify its position on when gene therapy products would be considered the “same” or “different” for purposes of orphan drug exclusivity.

The draft guidance notes that if two gene therapy products differ in the genes expressed by the products (“transgenes”) and the vectors used to deliver the transgenes are different, then the two gene therapy products are different and could both be approved for the same indication.

and could both be approved for the same indication.

However, there is considerable uncertainty as to the interpretation of these guidelines, if adopted to become final.

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(i) exon skipping product candidates, such as Wave Life Sciences (notably for exons 51 and 53), Nippon Shinyaku (notably for exon 44 and exon 53, for which it has received FDA approval for its product Viltepso (viltolarsen)), Daiichi Sankyo (notably for exon 45), Dyne Therapeutics pursuing antibody-oligonucleotide conjugates for exons 44, 45, 51, and 53, Avidity Biosciences pursuing antibody-oligonucleotide conjugates for exons 44, 45 and 51, Audentes Therapeutics, Inc.

(acquired by Astellas Pharma) pursuing AAV vector delivery of oligonucleotides (for exons 2, 51 and 53), PepGen (notably for exon 51) and BioMarin (BMN-351);

(ii) gene therapies that express micro-dystrophin or mini-dystrophin, such as Pfizer and Solid Biosciences (in partnership with Ultragenyx);

(acquired by Astellas Pharma) pursuing AAV vector delivery of oligonucleotides (for exons 2, 51 and 53), PepGen (notably for exon 51) and BioMarin (BMN-351 for exon 51);

(ii) gene therapies that express micro-dystrophin or mini-dystrophin, such as Pfizer and Solid Biosciences (in partnership with Ultragenyx), and Regenxbio;

(iii) gene editing, including CRISPR/Cas 9 approaches, such as Exonics Therapeutics (acquired by Vertex Pharmaceuticals), CRISPR Therapeutics, Editas Medicine and Precision Biosciences (in partnership with Eli Lilly);

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Indeed, BioMarin recently announced it is pursuing IND enabling studies for BMN-351, an oligonucleotide therapy.

In addition, while Wave announced its intention to discontinue development of suvodirsen and suspend development of WVE-N531, it recently announced that it intends to file a CTA for its exon 53 oligonucleotide, WVE-N531.

In addition, while Wave announced its intention to discontinue development of suvodirsen and suspend development of WVE-N531, it recently announced that it commenced clinical development for its exon 53 oligonucleotide, WVE-N531.

In addition, we are aware of many pharmaceutical and biotechnology companies that are actively engaged in research and development using platform technologies that may be viewed as competing with ours beyond and including those companies mentioned immediately above, such as Alnylam Pharmaceuticals, Inc., Tekmira Pharmaceuticals Corp., Deciphera Pharmaceuticals, Ionis Pharmaceuticals, Inc., Roche Innovation Center Copenhagen (formerly Santaris Pharma A/S), Shire plc (now Takeda), Biogen, Moderna Therapeutics, Avidity, Dyne Therapeutics, Stoke Therapeutics, Fulcrum Therapeutics, Ultragenyx, Sanofi and PepGen.

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If any of our competitors are successful in obtaining regulatory approval for any of their product candidates, it may limit our ability to enter into the market, gain market share or maintain market share in the DMD space or other diseases targeted by our platform technologies, products and product candidate pipeline.

It is possible that our competitors will succeed in developing technologies that limit the market size for our products or product candidates, impact the regulatory approval and post-marketing process for our products and product candidates, are more effective than our products or product candidates or would render our technologies obsolete or noncompetitive.

It is possible that our competitors will succeed in developing technologies that limit the market size for our products or product candidates, impact the regulatory approval and post-marketing process for our products and product candidates , are more effective than our product s or product candidates or would render our technologies obsolete or noncompetitive.

Our competitors may, among other things:

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In addition, to the extent we rely on Roche to commercialize any products for which we obtain regulatory approval, we may receive less revenues than if we commercialized these products ourselves, which could materially harm our prospects.

E ven if we achieve the long-term benefits associated with strategic transactions, our expenses and short-term costs may increase materially and adversely affect our liquidity and short-term net income (loss).

Even if we achieve the long-term benefits associated with strategic transactions, our expenses and short-term costs may increase materially and adversely affect our liquidity and short-term net income (loss).

Future licenses or acquisitions could result in potentially dilutive issuances of equity securities, the incurrence of debt, the creation of contingent liabilities, impairment or expenses related to goodwill, and impairment or amortization expenses related to other intangible assets, which could harm our financial condition.

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The recent responses to COVID-19 by healthcare providers and regulatory agencies could delay the commencement of clinical trials, site initiation, protocol compliance, the completion of clinical trials, including the completion of post-marketing requirements and commitments, slow down enrollment, and make the ongoing collection of data for patients enrolled in studies more difficult or intermittent.

In addition, the pandemic may impact patient ability and willingness to travel to clinical trial sites as a result of fear, physician recommendation, quarantines and other restrictions, which may negatively impact the execution of clinical trials.

Any inability to complete successfully pre - clinical and clinical development could result in additional costs to us or impair our ability to generate revenues from product sales, regulatory and commercialization milestones and royalties.

In addition, manufacturing or formulation changes to our product candidates often require additional studies to demonstrate comparability of the modified product candidates to earlier versions.

Clinical study delays also 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, which impairs our ability to successfully commercialize our product candidates and harms our business and results of operations.

Clinical study delays also 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, which impair s our ability to successfully commercialize our product candidates and harm s our business and results of operations.

Results from pre-clinical and early‑stage clinical trials may not be indicative of safety or efficacy in late‑stage clinical trials, and pre-clinical and clinical trials may fail to demonstrate acceptable levels of safety, efficacy, and quality of our product candidates, which could prevent or significantly delay their regulatory approval.

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In January 2021, we released top-line results for Part 1 of Study 102 and interim expression results from Part 2 of Study 102.

In May 2021, we announced 12-week expression and safety results from the first 11 participants enrolled in Study 103.

For SRP-5051, in December 2020, we announced an interim analysis on clinical results from the 10 mg/kg and 20 mg/kg dose cohorts of Part A of Study 5051-201.

In May 2021, we announced results from the 30 mg/kg cohort of Part A of Study 5051-201.

In addition, in February 2019, we announced expression and biomarker data from the first three-patient low-dose cohort dosed in the SRP-9003 gene therapy trial to treat LGMD type 2E, or beta-sarcoglycanopathy and, in October 2019, we announced nine-month functional data from these three patients.

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Our gene therapy product candidates may be perceived as unsafe or may result in unforeseen adverse events.

Failure of other gene therapy programs, negative public opinion and increased regulatory scrutiny of gene therapy may damage public perception of the safety of our gene therapy product candidates and harm our ability to conduct our business or obtain regulatory approvals for our gene therapy product candidates.

Failure of other gene therapy programs, n egative public opinion and increased regulatory scrutiny of gene therapy may damage public perception of the safety of our gene therapy product candidates and harm our ability to conduct our business or obtain regulatory approvals for our gene therapy product candidates.

Gene therapy remains a newly applied technology, with only a few gene therapy products approved to date in the U.S., the EU or elsewhere.

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Even if we meet FDA requirements and an advisory committee votes to recommend approval of an NDA or BLA submission, the FDA could still disagree with the advisory committee’s recommendation and deny approval of a product candidate based on their review.

The regulatory approval process for product candidates targeting orphan diseases, such as DMD, that use new technologies and processes, such as antisense oligonucleotide therapies, gene therapy and other alternative approaches or endpoints for the determination of efficacy is uncertain due to, among other factors, evolving interpretations of a new therapeutic class, the broad discretion of regulatory authorities, lack of precedent, small safety databases, varying levels of applicable expertise of regulators or their advisory committees, scientific developments, changes in the competitor landscape, shifting political priorities and changes in applicable laws, rules or regulations and interpretations of the same.

interpretations of the same.

As a result of uncertainty in the approval process for products intended to treat serious rare diseases, we may not be able to anticipate, prepare for or satisfy requests or requirements from regulatory authorities, including completing and submitting planned NDAs, BLAs and MAAs for our product candidates, in a timely manner, or at all.

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Currently, only a few gene therapy products have been approved in the Western world.

Given the few precedents of approved gene therapy products, it is difficult to determine how long it will take or how much it will cost to obtain regulatory approvals for our gene therapy product candidates in the U.S., the EU or other jurisdictions.

, the E U or other jurisdictions.

Approvals by the EMA and the European Commission may not be indicative of what the FDA may require for approval.

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In addition, regarding fast track products and breakthrough therapies, the FDA may later decide that the products no longer meet the conditions for qualification as either a fast track product, RMAT, or a breakthrough therapy or, for priority review products, decide that period for FDA review or approval will not be shortened.

We may not be able to advance all of our programs, and w e may use our financial and human resources to pursue particular program s and fail to capitalize on programs that may be more profitable or for which there is a greater likelihood of success.

We may not be able to advance all of our programs, and we may use our financial and human resources to pursue particular programs and fail to capitalize on programs that may be more profitable or for which there is a greater likelihood of success.

Our pipeline includes more than 40 programs in various stages of development for a broad range of diseases and disorders.

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We rely on these parties for execution of our pre-clinical and clinical trials, and we control only certain aspects of their activities.

Nevertheless, we are responsible for ensuring that each of our studies is conducted in accordance with the applicable protocol and legal, regulatory and scientific standards, and our reliance on collaborators and CROs does not relieve us of our regulatory responsibilities.

Nevertheless, we are responsible for ensuring that each of our studies is conducted in

accordance with the applicable protocol and legal, regulatory and scientific standards, and our reliance on collaborators and CROs does not relieve us of our regulatory responsibilities.

The individuals at our third-party collaborators and CROs who conduct work on our behalf, including their sub-contractors, are not always our employees, and although we participate in the planning of our early stage research and pre-clinical and clinical programs, we cannot control whether or not they devote sufficient time and resources or exercise appropriate oversight of these programs, except for remedies available to us under our agreements with such third parties.

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The limited number of third parties with facilities and capabilities suited for the manufacturing process of our products and product candidates creates a heightened risk that we may not be able to obtain materials and APIs in the quantity and purity that we require.

In addition, the process for adding new manufacturing capacity is lengthy and often cause s delays in development efforts.

Any interruption of the development or operation of those facilities due to, among other reasons, events such as the ongoing COVID-19 pandemic , order delays for equipment or materials, equipment malfunction s , quality control and quality assurance issues, regulatory delays and possible negative effects of such delays on supply chains and expected timelines for product availability, production yield issues, shortages of qualified personnel, discontinuation of a facility or business or failure or damage to a facility by natural disasters , such as earthquake s or fire s , could result in the cancellation of shipments, loss of product in the manufacturing process or a shortfall in supply of our products , product candidates or materials.

In addition, the process for adding new manufacturing capacity is lengthy and often causes delays in development efforts.

Any interruption of the development or operation of those facilities due to, among other reasons, events such as the ongoing COVID-19 pandemic, order delays for equipment or materials, equipment malfunctions, quality control and quality assurance issues, regulatory delays and possible negative effects of such delays on supply chains and expected timelines for product availability, production yield issues, shortages of qualified personnel, discontinuation of a facility or business or failure or damage to a facility by natural disasters, such as earthquakes or fires, could result in the cancellation of shipments, loss of product in the manufacturing process or a shortfall in supply of our products, product candidates or materials.

If these third parties cease providing quality manufacturing and related services to us, and we are not able to engage appropriate replacements in a timely manner, our ability to manufacture our products or product candidates in sufficient quality and quantity required for our planned commercial, pre-clinical and clinical or EAPs, our various product research, development and commercialization efforts would be adversely affected.

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Problems in third-party manufacturing processes or facilities also restrict our ability to meet market demand.

We, through our third-party manufacturers, seek to produce or produce supply of our products and product candidates.

We, throu gh our third- party manufacturers, seek to produce or produce supply of our products and product candidates.

In light of the limited number of third parties with the expertise to produce our products and product candidates, the lead time needed to manufacture them, and the availability of underlying materials, we may not be able to, in a timely manner or at all, establish or maintain sufficient commercial and other manufacturing arrangements on the commercially reasonable terms necessary to provide adequate supply of our products and product candidates.

Furthermore, we may not be able to obtain the significant financial capital that may be required in connection with such arrangements.

Even after successfully engaging third parties to execute the manufacturing process for our products and product candidates, such parties may not comply with the terms and timelines they have agreed to for various reasons, some of which may be out of their or our control, which impacts our ability to execute our business plans on expected or required timelines in connection with the commercialization of our products and the continued development of our product candidates.

When we enter into long-term manufacturing agreements that contain exclusivity provisions and /or substantial termination penalties, we constrain our operational flexibility.

Even after successfully engaging third parties to execute the manufacturing process for our products and product candidates, such parties may not comply with the terms and timelines they have agreed to for various reasons, some of which may be out of their or our control, which impact s our ability to execute our business plans on expected or required timelines in connection with the commercialization of our products and the continued development of our product candidates.

W hen w e enter into long-term manufacturing agreements that contain exclusivity provisions and /or substantial termination penalties, we constrain our operational flexibility .

A significant outbreak of COVID-19 at one of our partner sites could lead to delays in the manufacturing of our products and product candidates.

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Failure to achieve and maintain compliance with cGMP and other applicable government regulations, including failure to detect or control anticipated or unanticipated manufacturing errors, results in product recalls, clinical holds, delayed or withheld approvals, patient injury or death.

This risk is particularly heightened as we optimize manufacturing for our product candidates.

For example, we were notified by the Research Institute at Nationwide that they received a letter from the FDA on July 24, 2018, stating that their Phase 1/2a DMD micro-dystrophin gene therapy trial had been placed on clinical hold due to the presence of a trace amount of DNA fragment in research-grade third-party supplied plasmid (the “Clinical Hold”).

The Research Institute, working with us, developed an action plan with immediate plans to submit for review by the FDA, which included the use of cGMP plasmid for the program.

On September 24, 2018, we announced that the FDA had lifted the Clinical Hold.

Failure by our contract manufacturers to adhere to applicable cGMP and other applicable government regulations , or our contract manufacturers experienc ing manufacturing problems, may result in significant negative consequences, including product seizures or recalls, postponement or cancellation of clinical trials, loss or delay of product approval, fines and sanctions, loss of revenue, termination of the development of a product candidate, reputational damage, shipment delays, inventory shortages, inventory write-offs and other product-related charges and increased manufacturing costs.

Failure by our contract manufacturers to adhere to applicable cGMP and other applicable government regulations, or our contract manufacturers experiencing manufacturing problems, may result in significant negative consequences, including product seizures or recalls, postponement or cancellation of clinical trials, loss or delay of product approval, fines and sanctions, loss of revenue, termination of the development of a product candidate, reputational damage, shipment delays, inventory shortages, inventory write-offs and other product-related charges and increased manufacturing costs.

If we experience any of these consequences, the success of our commercialization of our products and/or our development efforts for our product candidates could be significantly delayed, fail or otherwise be negatively impacted.

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Challenges complying with cGMP requirements and other quality issues arise during efforts to increase manufacturing capacity and scale up production.

We experience such issues in connection with manufacturing, packaging and storage of our products and product candidates, and during shipping and storage of the APIs or finished drug product.

We experience such issues in connection with manufacturing, packaging and storage of our products and product candidate s , and during shipping and storage of the APIs or finished drug product.

In addition, in order to release our products for commercial use and demonstrate stability of product candidates for use in clinical trials (and any subsequent drug products for commercial use), our manufacturing processes and analytical methods must be validated in accordance with regulatory guidelines.

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We also may encounter problems hiring and retaining the experienced scientific, quality control and manufacturing personnel needed to operate our manufacturing process which could result in delays in our production or difficulties in maintaining compliance with applicable regulatory requirements.

Furthermore, no manufacturer currently has the capacity and scalability to produce our vectors or gene therapy product candidates at commercial levels.

Furthermore, n o manufacturer currently has the capacity and s calability to produce our vectors or gene therapy product candidates at commercial levels.

Even if we timely develop a manufacturing process and successfully transfer it to the third-party vector and product manufacturers or successfully and timely develop our internal capacity, if we or such third-party manufacturers are unable to produce the necessary quantities of viral vectors and our product candidates, or in compliance with GMP or other pertinent regulatory requirements, and within our planned time frame and cost parameters, it may result in delays in our development plans or increased capital expenditures , and the development and sales of our products, if approved, may be materially harmed.

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Upon the expiration or loss of patent protection or the expiration or loss of regulatory exclusivity for a product, the major portion of revenues for that product may be dramatically reduced in a very short period of time.

If we are not successful in defending our patents and regulatory exclusivities, we will not derive the expected benefit from them.

If we are not

successful in defending our patents and regulatory exclusivities, we will not derive the expected benefit from them.

As such, a third party could be positioned to market an ANDA or Section 505(b)(2) product that competes with one of our products prior to the expiry of our patents if the third party successfully challenged the validity of our patents protecting the product.

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In order to maintain or obtain freedom to operate for our products and product candidates, we may incur significant expenses, including those associated with entering into agreements with third parties that require milestone and royalty payments.

Additionally, if we were to challenge the patent rights of our competitors or otherwise defend against allegations of infringement, misappropriation or related claims, we could incur substantial costs and ultimately might not be successful.

Additionally, if we were to challenge the patent rights of our competitors or otherwise defend against allegations of infringement, misappropriation, breach of contract or related claims, we could incur substantial costs and ultimately might not be successful.

If our products, product candidates , or platform technologies are alleged to infringe or are determined to infringe enforceable proprietary rights of others, we could incur substantial costs and may have to:

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Risks Related to our Business Operations

The outbreak of COVID-19 has resulted, and may continue to result in disruptions to our commercialization, clinical trials, manufacturing and other business operations, which could have a material adverse effect on our business, financial condition, operating results, cash flows and prospects.

The COVID-19 pandemic has presented a substantial public health and economic challenge around the world.

The rapid spread of COVID-19 has led to the implementation of various responses, including government-imposed quarantines, shelter-in-place mandates, sweeping restrictions on travel, mandatory shutdowns for non-essential businesses, requirements regarding social distancing, and other public health safety measures, as well as reported adverse impacts on healthcare resources, facilities and providers across the United States and in other countries.

In response to the pandemic, healthcare providers have, and may need to further, reallocate resources, such as physicians, staff, hospital beds, and intensive care unit facilities, as they prioritize limited resources and personnel capacity to focus on the treatment of patients with COVID-19 and implement limitations on access to hospitals and other medical institutions due to concerns about the potential spread of COVID-19 in such settings.

These actions have and may continue to negatively impact commercialization, clinical trials, manufacturing and other business operations, including:

The response to COVID-19 by healthcare providers has made it difficult for some patients, especially those dependent on a hospital setting, to receive infusions or initiate treatment with our commercial products.

In addition, as a result of the pandemic, some patients may choose to delay or stop treatment to avoid a visit to a hospital or a visit of a third party in their homes to minimize the risk of infection.

The impact of COVID-19 may also result in delays in processing reauthorizations and modifications to program benefits by insurers, making it difficult for patients to obtain or maintain favorable coverage decisions for our products.

In addition, the increase in unemployment due to the pandemic has resulted in decreased insurance coverage for many individuals.

These challenges may continue for the duration of the COVID-19 pandemic, which is uncertain, and are expected to reduce our revenue and cash flows.

Clinical trials:

The impact of COVID-19 has caused disruptions and may cause delays in some of our clinical trials.

Missing data could undermine data integrity and probability of success.

The recent responses to COVID-19 by healthcare providers and regulatory agencies could delay the commencement of trials, site initiation, compliance in the trials, the completion of trials, including the completion of post-marketing requirements and commitments, slow down enrollment, and make the ongoing collection of data for patients enrolled in studies more difficult or intermittent.

We are implementing certain strategy and technology in an attempt to mitigate this risk in the event of subsequent outbreaks.

In addition, as COVID-19 continues to spread, some participants and clinical investigators may be unable or unwilling to comply with clinical trial protocols.

For example, quarantines or other travel limitations (whether voluntary or required) have been implemented in many countries, and may impede participant movement, affect sponsor access to study sites, or interrupt healthcare services, which may negatively impact the execution of clinical trials.

Significant delays or disruptions to our clinical trials could adversely affect our ability to timely initiate studies, conduct successful studies, obtain or maintain regulatory approvals, or commercialize our product candidates.

Manufacturing:

A significant outbreak at one of our partner sites could lead to delays in the manufacturing of our products and product candidates.

In addition, the need to prioritize rated orders issued by the Federal Emergency Management Agency pursuant to the U.S.

Defense Production Act could impact the manufacturing, supply chain and distribution of our products and product candidates.

On March 13, 2020, to protect the health of our employees and their families, and our communities, and in accordance with direction from state and local government authorities, we instituted mandatory work-from-home for all employees and contingent workers other than those who are facility-dependent.

Our increased reliance on personnel working from home may negatively impact productivity or disrupt, delay or otherwise adversely impact our business.

In addition, remote working could increase our cyber security risk.

General protective measures put into place at various governmental levels, including quarantines, travel restrictions and business shutdowns, may also negatively affect our operations.

Further, if the spread of the COVID-19 pandemic continues and our operations are adversely impacted, including due to an outbreak in a facility, we risk a delay, default and/or nonperformance under existing agreements.

The extent and duration of the impact of the COVID-19 pandemic on our stock price is uncertain.

The COVID-19 pandemic may cause our stock price to be more volatile, and our ability to raise capital could be impaired.

Any of the foregoing factors could have a material adverse impact on our business, financial condition, operating results, cash flows and prospects.

The extent to which COVID-19 impacts our operations and those of our third-party partners will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the pandemic, additional or modified government actions, new information which emerges concerning the severity of COVID-19 and the actions taken to contain the virus or treat its impact, among others.

In particular, the speed of the continued spread of COVID-19 globally, and the magnitude of interventions to contain the spread of the virus, will determine the impact of the pandemic on our operations.

If we fail to comply with healthcare and other regulations, we could face substantial penalties and our business, operations and financial condition could be adversely affected.

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If our operations are found to be in violation of any of the laws described above or any other laws, rules or regulations that apply to us, we will be subject to penalties, including civil and criminal penalties, damages, fines and the curtailment or restructuring of our operations.

Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results.

Any penalties, damages, fines,

curtailment or restructuring of our operations could adversely affect our ability to operate our business and our financial results.

Responding to government investigations, defending any claims raised, and any resulting fines, restitution, damages and penalties, settlement payments or administrative actions, as well as any related actions brought by stockholders or other third parties, could have a material impact on our reputation, business and financial condition and divert the attention of our management from operating our business.

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economy in light of the COVID-19 outbreak, including temporary beneficial changes to the treatment of net operating losses, interest deductibility limitations and payroll tax matters.

We continue to monitor for legislative developments, issuance of regulations and technical memorandum to provide further clarification and/or interpretations of the TCJA, as modified by the CARES Act.

We continue to monitor changes in tax laws in the U.S.

and the impact of proposed and enacted legislation in the international jurisdictions in which the company operates.

President Biden has provided informal guidance on tax law changes he may support.

Among other things, his proposals would raise the rate on both domestic and foreign income.

If these proposals are ultimately enacted into legislation, they could materially impact our tax provision, cash tax liability and effective tax rate.

If any of these proposals are ultimately enacted into legislation, they could materially impact our tax provision, cash tax liability and effective tax rate.

The COVID-19 pandemic has resulted, and may continue to result in disruptions to our commercialization, clinical trials, manufacturing and other business operations, which could have a material adverse effect on our business, financial condition, operating results, cash flows and prospects.

The COVID-19 pandemic has presented a substantial public health and economic challenge around the world.

These responses may be extended by the duration of the outbreak, periodic spikes in infection rates due to new strains of the virus including Delta or otherwise, local outbreaks of the virus, the broad availability of effective vaccines, new information that will emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact.

These actions have and may continue to negatively impact commercialization, clinical trials, manufacturing and other business operations, including:

In addition, the increase in unemployment due to the pandemic has resulted in decreased insurance coverage for many individuals.

These challenges may continue for the duration of the COVID-19 pandemic, which is uncertain, and are expected to reduce our revenue and cash flows.

Clinical trials:

The impact of COVID-19 has caused disruptions and may cause delays in some of our clinical trials.

Missing data could undermine data integrity and probability of success.

We have implemented certain strategies and technologies in an attempt to mitigate this risk in the event of subsequent outbreaks.

In addition, as COVID-19 continues to spread, some participants and clinical investigators may be unable or unwilling to comply with clinical trial protocols.

For example, quarantines or other travel limitations (whether voluntary or required) were implemented in many countries during the past year, and may impede participant movement, affect sponsor access to study sites, or interrupt healthcare services, which may negatively impact the execution of clinical trials.

Manufacturing:

A significant outbreak at one of our partner sites could lead to delays in the manufacturing of our products and product candidates.

In addition, the need to prioritize rated orders issued by the Federal Emergency Management Agency pursuant to the U.S.

Defense Production Act could impact the manufacturing, supply chain and distribution of our products and product candidates.

With increased availability of vaccines and public health guidelines evolving to reflect their availability, we have begun to re-open our offices to employees who are not facility-dependent and we are working toward the goal of fully re-opening our offices when permitted by applicable local, state and federal public health guidance.

We will continue, however, to monitor and make adjustments in response to the public health environment, together with local, state and federal guidance regarding workplace protective measures, including travel restrictions, quarantines, and business shutdowns.

If there is an increase in COVID-19 infection rates or new outbreaks, our operations may be adversely impacted.

Remote working could increase our cyber security risk.

The extent and duration of the impact of the COVID-19 pandemic on our stock price is uncertain.

The COVID-19 pandemic may cause our stock price to be more volatile, and our ability to raise capital could be impaired.

Any of the foregoing factors could have a material adverse impact on our business, financial condition, operating results, cash flows and prospects.

Our ability to use net operating loss carryforwards and other tax attributes to offset future taxable income may be limited as a result of future transactions involving our common stock.

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The loss of the services of any one of the principal members of our managerial team or staff may prevent us from achieving our business objectives.

The competition for qualified personnel in the biotechnology field is intense, and our future success depends upon our ability to attract, retain and motivate such personnel.

The competition for qualified personnel in the biotechnology field is intense, and our future success depends upon our ability to attract, retain, motivate and support such personnel.

In order to develop and commercialize our products successfully, we will be required to retain key management and scientific employees.

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In addition, we rely on certain consultants and advisors, including scientific and clinical advisors, to assist us in the formulation and advancement of our research and development programs.

Our consultants and advisors may be employed by other entities or have commitments under consulting or advisory contracts with third parties that limit their availability to us, or both.

Our consultants and advisors may be employed by other entities or have commitments under consulting or advisory contracts with third parties that limit their

availability to us, or both.

If we are unable to attract, assimilate or retain such key personnel, our ability to advance our programs would be adversely affected.

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We have incurred operating losses since our inception and we may not achieve or sustain profitability.

We incurred an operating loss of $ 151.9 million for the period ended March 31, 2021.

Our accumulated deficit was $3.0 billion as of March 31, 2021.

Although we currently have two commercially approved products in the U.S., we believe that it will take us some time to attain profitability and positive cash flow from operations.

We incurred an operating loss of $319.4 million for the six months ended June 30, 2021.

Our accumulated deficit was $3.0 billion as of June 30, 2021.

Although we currently have three commercially approved products in the U.S., we believe that it will take us some time to attain profitability and positive cash flow from operations.

Since our products and product candidates target small patient populations, the per-patient drug pricing must be high in order to recover our development and manufacturing costs, fund adequate patient support programs, fund additional research and achieve profitability.

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add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts.

As a result, we expect to continue to incur significant operat ing losses at least through 2021 .

Because of the numerous risks and uncertainties associated with developing bio pharmaceutical products, we are unable to predict the extent of any future losses or when, or if, we will become profitable.

As a result, we expect to continue to incur significant operating losses at least through 2021.

Because of the numerous risks and uncertainties associated with developing biopharmaceutical products, we are unable to predict the extent of any future losses or when, or if, we will become profitable.

We will need to raise additional funding, which may not be available on acceptable terms, or at all.

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Our consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S.

The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported

amounts of our assets, liabilities, revenues and expenses, the amounts of charges accrued by us and related disclosure of contingent assets and liabilities.

The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of our assets, liabilities, revenues and expenses, the amounts of charges accrued by us and related disclosure of contingent assets and liabilities.

Such estimates and judgments include revenue recognition, inventory, valuation of stock-based awards, research and development expenses and income tax.

We base our estimates on historical experience, facts and circumstances known to us and on various other assumptions that we believe to be reasonable under the circumstances.

We cannot provide assurances, however, that our estimates, or the assumptions underlying them, will not change over time or otherwise prove inaccurate.

We cannot provide assurances, however, that

our estimates, or the assumptions underlying them, will not change over time or otherwise prove inaccurate.

If this is the case, we may be required to restate our consolidated financial statements, which could, in turn, subject us to securities class action litigation.

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Currently, our Amended and Restated Certificate of Incorporation authorizes the issuance of up to 198.0 million shares of common stock.

As of March 31, 2021, there were approximately 79.7 million shares of common stock outstanding and outstanding awards to purchase 10.3 million shares of common stock under various incentive stock plans.

Additionally, as of March 31, 2021, there were approximately 3.8 million shares of common stock available for future issuance under our 2018 Equity Incentive Plan, approximately 0.5 million shares of common stock available for issuance under our Amended and Restated 2013 Employee Stock Purchase Plan, and approximately 1.5 million shares of common stock available for issuance under our 2014 Employment Commencement Incentive Plan.

As of June 30, 2021, there were approximately 79.8 million shares of common stock outstanding and outstanding awards to purchase 9.8 million shares of common stock under various incentive stock plans.

Additionally, as of June 30, 2021, there were approximately 4.1 million shares of common stock available for future issuance under our 2018 Equity Incentive Plan, approximately 0.5 million shares of common stock available for issuance under our Amended and Restated 2013 Employee Stock Purchase Plan, and approximately 1.6 million shares of common stock available for issuance under our 2014 Employment Commencement Incentive Plan.

We may issue additional shares to grant equity awards to our employees, officers, directors and consultants under our 2018 Equity Incentive Plan, our 2013 Employee Stock Purchase Plan or our 2014 Employment Commencement Incentive Plan.

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The Capped Call Transactions are expected to generally reduce the potential dilution upon conversion of the Notes into shares of our common stock.

In connection with establishing their initial hedges of the Capped Call Transactions, these financial institutions or their respective affiliates entered into various derivative transactions with respect to our common stock and/or to purchase our common stock.

In connection with establishing their initial hedges of the Capped Call Transactions, these financial institutions or their respective affiliates may have entered into various derivative transactions with respect to our common stock and/or purchased our common stock.

The financial institutions, or their respective affiliates, may modify their hedge positions by entering into or unwinding various derivatives with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions prior to the maturity of the Notes.

This activity could also cause or avoid an increase or a decrease in the market price of our common stock or the Notes, which could affect the value of our common stock.

This activity may have an impact on the value of our common stock.

General Risks

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

What changed 10-Q

Item 1A. Risk Factors