What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2022-03-10 compared with 2021-03-09 · 426 added, 434 removed, 543 unchanged (61% of the section changed)

We are pioneering a new way to treat the underlying causes of severe genetic diseases by precisely upregulating protein expression.

We are developing novel antisense oligonucleotide (“ASO”) medicines that target ribonucleic acid (“RNA”) and modulate precursor-messenger RNA splicing to upregulate protein expression where needed and with appropriate specificity to near normal levels.

We utilize our proprietary RNA therapeutics platform, Targeted Augmentation of Nuclear Gene Output (“TANGO”), to design ASOs to upregulate the expression of protein by individual genes in a patient.

Our approach is designed to allow us to deliver in a highly precise, durable and controlled manner disease-modifying therapies to a wide range of relevant tissues, including the central nervous system, eye, kidney and liver.

We were incorporated in June 2014.

In July 2015 and April 2016, we entered into worldwide license agreements with Cold Spring Harbor Laboratory (“CSHL”), and the University of Southampton, respectively, with respect to certain licensed patents and applications relating to TANGO.

TANGO exploits non-productive splicing events to effect targeted enhancement of protein expression.

Since our inception through June 21, 2019, our operations had been financed primarily from the sale of convertible notes payable and our convertible preferred stock.

On June 21, 2019, we completed an initial public offering (“IPO”), of our common stock and issued and sold 9,074,776 shares of common stock at a public offering price of $18.00 per share, which included 1,183,666 shares sold upon full exercise of the underwriters’ option to purchase additional shares of common stock resulting in net proceeds of $151.9 million after deducting underwriting discounts and commissions but before deducting offering costs of approximately $2.5 million.

On July 10, 2020, we entered into an “at-the-market” program and sales agreement with Cantor Fitzgerald & Co., or Cantor, and Stifel, Nicolaus & Company, Incorporated, or Stifel, under which we may, from time to time, offer and sell common stock having an aggregate offering value of up to $150.0 million, referred to as our “at-the-market” offering with Cantor and Stifel.

As of December 31, 2020, no such shares of our common stock had been offered or sold pursuant to this “at-the-market” program with Cantor and Stifel.

We may terminate this at-the-market program at any time, pursuant to its terms.

On November 24, 2020, we completed an underwritten public offering, of our common stock and issued and sold 2,875,000 shares of common stock at a public offering price of $39.00 per share, which included 375,000 shares sold upon full exercise of the underwriters’ option to purchase additional shares of common stock resulting in net proceeds of $104.9 million after deducting underwriting discounts and commissions and estimated offering expenses.

Our proprietary RNA therapeutics platform is based on the pioneering work conducted on pre-mRNA splicing and ASOs in the laboratory of one of our co-founders, Adrian R.

Krainer, Ph.D., of Cold Spring Harbor Laboratory in New York.

We are dedicated to addressing the underlying causes of severe diseases by upregulating protein expression with RNA-based medicines.

Using our proprietary TANGO (Targeted Augmentation of Nuclear Gene Output) approach, we are developing antisense oligonucleotides (“ASOs”) to selectively restore protein levels.

Our first compound, STK-001, is in clinical testing for the treatment of Dravet syndrome, a severe and progressive genetic epilepsy.

Dravet syndrome is characterized by frequent, prolonged and refractory seizures beginning within the first year of life.

The disease is classified as a developmental and epileptic encephalopathy due to the developmental delays and cognitive impairment associated with it.

Dravet syndrome is one of many diseases caused by a haploinsufficiency, in which a loss of approximately 50% of normal protein levels leads to disease.

We are also pursuing treatment for a second haploinsufficient disease, autosomal dominant optic atrophy (“ADOA”), the most common inherited optic nerve disorder.

Our initial focus is haploinsufficiencies and diseases of the central nervous system and the eye, although proof of concept has been demonstrated in other organs, tissues, and systems, supporting our belief in the broad potential for our proprietary approach.

TANGO is based on the pioneering work conducted on pre-mRNA splicing and ASOs in the laboratory of one of our co-founders, Adrian R.

Krainer, Ph.D., of Cold Spring Harbor Laboratory in New York (“CSHL”).

Inspired by the clinical success of SPINRAZA (nusinersen), an ASO medicine for the treatment of spinal muscular atrophy that was co-invented by Professor Krainer, our company was founded to develop a general antisense approach to upregulate protein expression.

TANGO exploits unique, patented mechanisms for antisense-mediated modulation of splicing to prevent the synthesis of naturally occurring non-productive messenger RNA, or mRNA, and to increase the synthesis of productive mRNA to increase production of functional protein.

Our technology is amenable to a large number of mutations and can thereby potentially provide a single-drug approach for diseases that are caused by many loss-of-function mutations in a single gene.

We have identified approximately 1,200 monogenic, or single gene, diseases which we believe may be amenable to TANGO.

We have an intellectual property estate that includes multi-national allowed and pending claims for the TANGO mechanisms, as well as multi-national pending claims relating to compositions of matter of oligonucleotides designed to target specific TANGO elements in genes for more than 140 genetic diseases that we believe are amenable to upregulation of target protein expression using TANGO.

We are initially focused on applying the transformative potential of our platform to develop precision medicines for autosomal dominant haploinsufficiency diseases.

There are more than 660 known monogenic diseases that are categorized as haploinsufficiencies.

These diseases are ones in which only one copy, or allele, of the gene needs to be mutated for the disease or trait to develop, and that mutated allele generates a protein that is severely deficient in amount or activity, resulting in approximately 50% of normal protein expression in the patient.

We believe TANGO is well-suited to treat haploinsufficiencies by increasing expression of the healthy, or wild-type, allele, thereby restoring the target protein to near normal levels.

We are developing TANGO as potentially the first precision medicine platform for a category of severe genetic diseases known as autosomal dominant haploinsufficiencies .

Existing precision medicine platforms, including gene therapy, gene editing, modified mRNA, protein-based drugs, small molecules and oligonucleotides, have fundamental limitations that make them poorly suited to address haploinsufficiencies .

Numerous technical challenges preclude effective application of these modalities to haploinsufficiencies , including:

( i ) the inability to control level and tissue distribution of target protein expression, (ii) potential irreversible on- and off-target effects, (iii) target gene size limitations, (iv) incompatibility with diseases caused by many mutations, (v) drug manufacturing and (vi) delivery hurdles.

There is a need for novel therapeutics that can restore protein expression and address the underlying genetic causes of haploinsufficiencies .

Within haploinsufficiency diseases, we continue to prioritize the development of ASOs for the treatment of genetic epilepsies.

According to a 2010 publication in Nature Reviews Neurology and a 2018 publication in JAMA Neurology , more than 50% of epilepsies are now recognized as having a genetic basis and more than 30% of patients are refractory to existing therapies, especially those with a genetic epilepsy.

Our most advanced program is the potentially first disease-modifying therapy for Dravet syndrome, a severe and progressive genetic epilepsy.

Dravet syndrome is caused by loss-of-function mutations in one allele of the SCN1A gene and is characterized by frequent, prolonged, and refractory seizures beginning within the first year of life.

Dravet syndrome is difficult to treat and has a poor long-term prognosis.

The effects of the disease go beyond seizures and often include severe intellectual and developmental disabilities and other serious health problems, including, notably, sudden premature death in approximately 20% of patients with Dravet syndrome.

Current treatments for Dravet syndrome only address the occurrence of seizures, not the underlying cause of disease.

According to a 2017 study as published in the Developmental Medicine & Child Neurology Journal , more than 90% of Dravet syndrome patients still report suffering from incomplete seizure control with existing antiepileptic regimens.

Our executive management team has extensive collective expertise in human genetics and modulation of RNA processes using ASOs, as well as a track record of success in rare disease drug development.

2 unchanged sentences

Their involvement in both academic research and clinical practice allows us to gain proprietary and early insight into emerging biology and clinical practice that informs our business strategy.

We are using our proprietary RNA therapeutics platform to create ASOs for the treatment of severe genetic diseases.

We are using our proprietary RNA therapeutics platform to create ASOs for the treatment of severe diseases.

The critical components of our strategy include:

Rapidly advance our lead program, STK-001, to clinical proof-of-concept, approval and commercialization.

Our MONARCH Phase 1/2a clinical trial in children and adolescents with Dravet syndrome is ongoing.

In August 2020, we dosed the first patient in the MONARCH Study.

We are leveraging previously-validated ASO chemistry, a modality that has been successfully utilized for other diseases, a well-defined patient population based on routine genetic testing and learnings from recently approved drugs for the treatment of Dravet syndrome to inform the clinical and regulatory pathways for STK-001 and minimize potential safety concerns and development risk.

Phase 1/2a trials of STK-001 are ongoing in the United States (MONARCH) evaluating children and adolescents ages 2 to 18 with Dravet syndrome and in the United Kingdom (ADMIRAL) evaluating children and adolescents ages 2 to up to 18 with Dravet syndrome.

We are leveraging previously-validated ASO chemistry, a modality that has been successfully utilized for other diseases, a well-defined patient population based on routine genetic testing and learnings from approved drugs for the treatment of Dravet syndrome to inform the clinical and regulatory pathways for STK-001 and minimize potential safety concerns and development risk.

We believe STK-001 has the potential to significantly reduce both the occurrence and frequency of seizures and also non-seizure comorbidities.

1 unchanged sentence

If approved, we intend to leverage a lean, targeted internal commercial organization to bring STK-001 to patients.

Prioritize genetic epilepsies for near-term development efforts.

We believe that no other haploinsufficiency disease area holds as much clear need or as much promise for near-term medical breakthrough as genetic epilepsies.

Leveraging our proprietary database, we have identified over 100 genes that are commonly mutated amongst epilepsy patients and that may be amenable to TANGO.

We believe that the learnings from our lead Dravet syndrome program will significantly reduce the developmental risk of subsequent programs in our pipeline, particularly those targeting the CNS.

Expand our pipeline into other disease areas to fully exploit the potential of our proprietary platform.

Advance STK-002 to the clinic, for the potential treatment of ADOA.

STK-002 is a proprietary ASO in preclinical development for the treatment of ADOA, the most common inherited optic nerve disorder.

ADOA represents a second haploinsufficiency disease addressed by TANGO and our first treatment for diseases of the eye.

STK-002 is designed to upregulate OPA1 protein expression by leveraging the non-mutant (wild-type) copy of the OPA1 gene.

Preclinical toxicology studies are currently ongoing to support future clinical trials for STK-002.

Expand our pipeline through internal discovery and collaboration to fully exploit the potential of our proprietary platform (TANGO).

We have built a target discovery process utilizing proprietary bioinformatics algorithms and extensive in-house expertise in whole transcriptome RNA sequencing to rapidly and systematically identify diseases that we believe can be addressed using our platform.

In November 2020, we announced the nomination of OPA1 as our next target for preclinical development to treat Autosomal Dominant Optic Atrophy (“ADOA”).

This is the second haploinsufficiency disease similar to Dravet syndrome and provides entry into genetic diseases of the eye.

We are also advancing additional early programs focused on multiple targets, including haploinsufficiency diseases

of the CNS, eye, kidney and liver.

We are also advancing additional early programs focused on multiple targets, including haploinsufficiency diseases of the central nervous system (the “CNS”) and eye.

In January 2022, we announced a collaboration with Acadia Pharmaceuticals to pursue RNA-based

treatments for severe and rare genetic neurodevelopmental diseases of the CNS.

The collaboration combines our TANGO research platform with Acadia’s expertise in neurology drug development and commercialization.

Longer-term, we believe that our ASOs may have the potential to upregulate non-mutated genes in biological pathways to treat diseases or conditions that are caused by multiple genes or are multifactorial, such as autoimmune diseases, aging and cancer.

Maintain broad commercial rights to our product candidates.

We own commercial rights to our technologies and clinical programs, including our lead product candidate, STK-001.

We intend to build a fully integrated biotechnology company and independently pursue the development and commercialization of our key product candidates.

Maintain broad commercial rights to our product candidates where we believe we can realize maximum value.

We intend to build a fully integrated biotechnology company and independently pursue the development and commercialization of our key product candidates, if approved.

We own commercial rights to our technologies and our lead product candidates, STK-001 and STK-002.

As we continue to advance our programs, we may pursue strategic collaborations to share risk and upside in programs with higher inherent biology risk, larger clinical trial sizes or longer or more complex clinical, regulatory or commercial paths.

We plan to opportunistically evaluate potential collaboration arrangements and may elect to enter into an arrangement with a pharmaceutical or biotechnology company as early as this year.

Our current collaboration with Acadia is an example of where we believe that the development of treatments for severe and rare genetic neurodevelopmental diseases of the CNS is well served by a strategic collaboration.

Continue to strengthen and expand our intellectual property portfolio.

We have an intellectual property estate that includes multi-national allowed and pending claims for the TANGO mechanisms, as well as multi-national pending claims relating to compositions of matter of oligonucleotides designed to target specific TANGO elements in genes for many genetic diseases that we believe are amenable to upregulation of target protein expression using TANGO.

Our proprietary position is reinforced by additional technical know-how and trade secrets.

We continually assess and refine our intellectual property strategy as we identify new targets amenable to TANGO, and we will file additional patent applications as appropriate.

Genetic diseases and precision medicines

Each person’s genetic material, or genome, consists of deoxyribonucleic acid, or DNA, in sequences of genetic code called genes.

There are two copies, or alleles, of each gene, which act as instructions to produce specific proteins.

When a cell needs to produce a protein, the instructions to make that protein are transcribed from DNA to mRNA for each allele.

The initial transcript is called pre-mRNA and contains both protein coding and non-coding elements.

During transcription, the non-protein coding elements, such as introns or non-coding exons, are removed in a process called pre-mRNA splicing.

Splicing serves to stitch together the coding elements, or exons, to generate mRNA.

The mRNA then serves as the instructions to produce protein.

Proteins are required for the structure, function, and regulation of the body’s tissues and organs.

The key steps for protein synthesis are exemplified in the schematic below.

The DNA in the human genome contains approximately three billion nucleotide base pairs, and small changes, or mutations, routinely occur in the base pairs.

A mutation in the gene can alter the amount or activity of the protein.

Currently, there are estimated to be over 10,000 diseases caused by a genetic abnormality in an individual gene.

These are also known as monogenic diseases.

Monogenic diseases can be categorized as either autosomal recessive or autosomal dominant diseases.

For diseases that are autosomal recessive, both alleles of a gene must be mutated for the disease or trait to develop.

The protein that is generated is severely deficient in amount or activity and typically results in less than 10-25% of normal protein expression in the patient.

Conversely, autosomal dominant diseases are those in which only one allele of the gene needs to be mutated for the disease or trait to develop.

Autosomal dominant diseases can be broken down into two categories:

autosomal dominant gain-of-function or dominant negative and autosomal dominant haploinsufficiency, or loss-of-function.

dominant gain-of-function (dominant negative) diseases, the mutant protein possesses a new deleterious or increased function and acts therefore as a toxic protein.

In our focus area of haploinsufficiency diseases, the mutated allele generates a protein that is severely deficient in amount or activity and results in approximately 50% of normal protein expression.

Haploinsufficiencies include both rare conditions as well as more common disorders.

Severe haploinsufficiencies typically arise from spontaneous mutation, and thus the incidence of these diseases is not reduced by pre-conception genetic screening.

Multiple therapeutic modalities, including gene therapy, gene editing, modified mRNA, protein-based drugs, small molecules and oligonucleotides are approved or are being developed to address all types of monogenic diseases.

However, most of these therapeutic approaches are focused on autosomal recessive or autosomal dominant gain-of-function (dominant negative) diseases.

The nature and fundamental limitations of these modalities make them poorly suited to address the underlying genetic cause of haploinsufficiency diseases.

Consequently, there has been little focus on drug development for these diseases despite a significant unmet medical need.

The table below summarizes the major categories of genetic diseases and the various precision medicine approaches that are actively being used or explored to address them.

Autosomal recessive

Autosomal dominant

gain-of-function /

dominant negative

Autosomal dominant

haploinsufficiency

Genetic mutation

Loss-of-function mutations in both gene alleles

Gain-of-function or dominant negative mutation in one gene allele (toxic protein)

Loss-of-function mutation in one gene allele

Less than 10-25% of

normal protein expression

Deleterious or increased protein expression

Approximately 50% of normal protein expression

Disease examples

• Phenylketonuria

• Lysosomal storage disorders

• Beta-thalassemia

• Cystic fibrosis

• Huntington’s disease

• Parkinson’s disease

• Spinocerebellar ataxia

• AD hypocalcemia

• Dravet syndrome

• Optic atrophy

• Tuberous sclerosis

• Polycystic kidney disease

Current and emerging precision medicines

• Gene therapy

• Gene editing

• Modified mRNA

• Protein-based drugs

• Small molecules

• Gene therapy

• Gene editing

• Protein-based drugs

• Small molecules

• Oligonucleotides

• Our TANGO technology ( 1)

Therapeutic goal

Upregulate protein expression to greater than 10-25% of normal

Downregulate protein expression / inhibit protein function

Upregulate protein expression to near normal

We have neither applied for, nor received, FDA approval for any of our product candidates to date.

Our precision medicine platform

Oligonucleotides

Oligonucleotides are short strands of modified RNA or DNA, usually 12-30 nucleotides in length, that are manufactured by chemical synthesis.

Single-stranded oligonucleotides that bind to mRNA are called ASOs, which have been developed primarily to downregulate protein expression by RNase H-mediated cleavage of target mRNA.

Over the past few years, there has been very limited success in developing clinical ASOs to upregulate protein expression due to a focus on indirect and weakly validated mechanisms of action such as targeting microRNAs or long non-coding RNAs that are associated with a gene transcript.

The only exceptions are SPINRAZA, which corrects a unique

splicing mutation in SMN2 , and Exondys-51, which generates an internally-truncated form of dystrophin after removing or ‘skipping’ out a mutated exon to restore the reading frame.

Neither drug represents a generalizable strategy to upregulate the expression of protein.

Similarly, double-stranded oligonucleotides have been developed primarily to downregulate protein expression by RNA interference mediated cleavage of target mRNA.

To date, there has been very limited success in developing clinical double-stranded oligonucleotides to upregulate protein expression.

Given these fundamental limitations of existing modalities, most genetic diseases, particularly autosomal dominant haploinsufficiencies, are dramatically underserved by current therapeutic options.

Within rare diseases, only 5% of conditions have an approved drug treatment, and most approved drugs only manage symptoms with little impact on outcomes and life expectancy.

We believe there is a clear need for our novel ASOs, which precisely upregulate target protein expression and have the potential to provide disease-modifying therapies to treat many diseases beyond the reach of current approaches.

Treatment of autosomal dominant haploinsufficiency diseases with TANGO

We are developing our proprietary RNA technology platform, TANGO, as potentially the first precision medicine platform for a category of severe genetic diseases known as autosomal dominant haploinsufficiencies.

We utilize TANGO to design ASOs to increase the expression of protein by individual genes in a patient.

Our proprietary RNA therapeutics platform (TANGO)

TANGO (Targeted Augmentation of Nuclear Gene Output) is our proprietary research platform.

Our initial applications for this technology are diseases in which one copy of a gene functions normally and the other is mutated, also called haploinsufficiencies.

In these cases, the mutated gene does not produce its share of protein, so the body does not function normally.

Using the TANGO approach and a deep understanding of RNA science, Stoke researchers design ASOs that bind to pre-mRNA and help the target genes produce more protein.

TANGO aims to restore missing proteins by increasing – or stoking – protein output from healthy genes, thus compensating for the non-functioning copy of the gene.

TANGO exploits unique mechanisms for modulation of splicing to prevent the synthesis of naturally occurring non-productive mRNA and increase the synthesis of productive mRNA, resulting in increased production of functional protein.

TANGO leverages non-productive mRNA, which is the result of non-productive splicing that leads to either transcript degradation due to non-coding exon inclusion or nuclear retention of transcripts due to intron retention.

In some cases, these non-productive splicing events are a part of normal gene regulation, and in all cases the non-productive splicing events are part of the wild-type or normal sequence of the gene.

Non-productive mRNA can be produced by both wild-type and mutant alleles and is not translated into protein.

We are initially focused on applying the transformative potential of our platform to developing precision medicines for haploinsufficiencies, or disorders in which only one allele of a gene is mutated, resulting in approximately 50% of normal protein expression.

We believe our TANGO technology is well-suited to provide a gene-specific increase in expression of the healthy, or wild-type, allele, thereby restoring the target protein to near normal levels.

The figures below illustrate the TANGO mechanism for increasing protein synthesis in a prospective patient with a haploinsufficiency.

To date, we have demonstrated this TANGO mechanism in preclinical models of haploinsufficiencies.

The left panel illustrates the prospective patient with a haploinsufficiency possessing one wild-type allele and one mutant allele.

Human cells naturally regulate protein production to maintain health.

Pre-mRNA splicing, including alternative splicing, is an important mechanism used to regulate how much protein and which protein variant is produced.

During splicing, introns are removed and exons are joined together to generate the mRNA template that carries the code to synthesize proteins.

More than one third of alternative splicing events in mammals do not produce functional proteins and lead to mRNA degradation through nonsense-mediated mRNA decay (“NMD”).

TANGO ASOs act at the pre-mRNA level and prevent non-productive alternative splicing so that the body produces more protein-coding mRNA and thus more protein.

This approach is particularly applicable to diseases that are caused by insufficient protein production.

In July 2020, we published data in the Journal Nature Communications that support our proprietary approach to precisely upregulate protein expression using TANGO ASOs.

To evaluate the approach broadly, Stoke researchers selected four gene targets that vary in type and abundance of non-productive splicing events, gene size and protein function:

PCCA (propionic acidemia);

SYNGAP1 (autosomal dominant mental retardation 5);

CD274 (autoimmune diseases, including uveitis);

and SCN1A (Dravet syndrome).

Stoke researchers designed TANGO ASOs to target the non-productive splicing events in these genes and their activity was evaluated.

Dose-dependent reductions of non-productive mRNA were observed to lead to increases in both productive mRNA and protein levels for each of the target genes.

Treatment of autosomal dominant haploinsufficiency diseases with TANGO ASOs

We are initially focused on applying the transformative potential of our platform to developing precision medicines for autosomal dominant haploinsufficiencies, or disorders in which only one allele of a gene is mutated, resulting in approximately 50% of normal protein expression.

Exhibits 1 and 2 shown below illustrate the TANGO mechanism for increasing protein synthesis in a prospective patient with a haploinsufficiency.

To date, we have demonstrated this TANGO mechanism in preclinical models of

haploinsufficiencies .

Exhibit 1 illustrates the prospective patient with a haploinsufficiency possessing one wild-type allele and one mutant allele.

The mutant allele is translated into non-functional protein and results in approximately 50% of normal protein expression.

In the right panel, treatment with our ASO would prevent the synthesis of naturally occurring non-productive mRNA and would increase the synthesis of productive mRNA, thereby restoring the target protein to near normal levels.

Exhibit 2 illustrates treatment with our ASO would prevent the synthesis of naturally occurring non-productive mRNA and would increase the synthesis of productive mRNA, thereby restoring the target protein to near normal levels.

Our preclinical studies show that any increase in mutant mRNA would have no effect on the net protein level.

Haploinsufficiency without TANGO-ASO Exhibit 2:

Haploinsufficiency with TANGO-ASO

TANGO mechanisms of action

2 unchanged sentences

TANGO operates in a mutation-independent manner, given it utilizes one wild-type allele, and does not alter protein coding splicing isoforms.

The net effect is increased

expression of functional protein from the wild-type allele.

The net effect is increased expression of functional protein from the wild-type allele.

The two categories of non-productive splicing events amenable to TANGO are retained introns and nonsense-mediated mRNA decay of the resulting mRNA.

6 unchanged sentences

This splice-switching decreases non-productive mRNA and increases productive mRNA, which is translated into increased protein expression from the wild-type allele.

This is shown in the figures below, with the left panel illustrating non-productive mRNA, which includes retained introns, and the right panel illustrating our ASOs binding to the pre-mRNA and redirecting the splicing machinery.

This is shown in the Exhibits 3 and 4 below, with the left panel illustrating non-productive mRNA, which includes retained introns, and the right panel illustrating our ASOs binding to the pre-mRNA and redirecting the splicing machinery.

Retained introns without TANGO-ASO Exhibit 4:

Retained introns with TANGO-ASO

The second category of non-productive splicing events amenable to TANGO is alternative splicing that leads to nonsense-mediated mRNA decay, or NMD, of the resulting mRNA.

6 unchanged sentences

In contrast to current exon skipping therapies, which remove a coding exon and result in a truncated protein, our TANGO mechanism skips out a non-coding NMD exon and yields a full-length functional protein.

Our lead product candidate, STK-001, targets an NMD exon and the general mechanism is shown in the figure below, with the left panel showing the non-productive mRNA failing to be translated into protein and the right panel showing our ASOs binding to the pre-mRNA and redirecting the splicing machinery.

Although STK-001 is currently our only current clinical product candidate, we would expect, based on our preclinical studies, for future product candidates targeting a NMD exon to operate in the same manner.

Our lead product candidates, STK-001 and STK-002, target an NMD exon and the general mechanism is shown in exhibits 5 and 6 below, with the left panel showing the non-productive mRNA failing to be translated into protein and the right panel showing our ASOs binding to the pre-mRNA and redirecting the splicing machinery.

NMD exon without TANGO-ASO Exhibit 6:

NMD exon with TANGO-ASO

Advantages of TANGO

1 unchanged sentence

Ability to address the underlying genetic cause of the disease.

We utilize TANGO to design ASOs to precisely upregulate protein expression, thereby addressing the underlying cause of the disease rather than the symptoms of the disease.

We utilize TANGO to design ASOs to precisely upregulate protein expression, thereby addressing the underlying cause of the disease in addition to the symptoms of the disease.

Applicability is mutation-independent.

12 unchanged sentences

Utility across wide array of diseases and tissue types.

We believe that ASO delivery to the CNS, eye, kidney and liver is well-established, providing us the potential to address a broad range of genetic diseases.

Additionally,

although FDA approval for any of our current or future product candidates is not assured, we believe that ASO delivery to the CNS is particularly well-precedented.

We believe that ASO delivery to the CNS, eye, kidney and liver is well-established, providing us the potential to address a broad range of severe diseases.

Fixed dose, rather than weight-based dosing .

1 unchanged sentence

As a result, for CNS and eye targets, the dose of our ASOs should not require adjustment between patients to be effective.

We believe that a fixed dose across all ages in these targets will lessen reimbursement hurdles associated with a weight-adjusted dose pricing model.

We believe that a fixed dose across all ages in these targets may lessen reimbursement hurdles associated with a weight-adjusted dose pricing model.

Favorable dosing regimen.

We believe our ASOs may require as few as two to three administrations per year for the CNS or the eye and will generally involve relatively low doses, which would translate to simplified use, an improved safety profile from reduced systemic exposure and lower cost of goods.

We believe our ASOs may require as few as two to three administrations per year for the CNS and as infrequent as once per year for the eye and will generally involve relatively low doses, which would translate to simplified use and an improved safety profile due to reduced systemic exposure.

Simple and scalable manufacturing .

8 unchanged sentences

RNAseq uses next-generation sequencing to determine the quantity and sequences of RNA in a sample.

We leverage large internal datasets of RNAseq from key tissues known to be addressable with antisense, such as the CNS, eye, liver and kidney, that are purpose-built to enhance the capture of non-productive events.

We leverage large internal datasets of

RNAseq from key tissues known to be addressable with antisense, such as the CNS, eye, liver and kidney, that are purpose-built to enhance the capture of non-productive events.

We employ machine learning to iteratively refine our search and scoring criteria for the most addressable non-productive mRNA elements based on internal target validation and Hit identification data.

3 unchanged sentences

Hit identification

Once a TANGO target is validated in cells and tissues that are relevant to the disease, we employ highly-efficient cell lines to rapidly screen for Hit ASOs that can increase the target protein expression by specifically preventing the occurrence of the non-productive event in the target mRNA.

Once a TANGO target is validated in cells and tissues that are relevant to the disease, we employ cell lines to rapidly screen for Hit ASOs that can increase the target protein expression by specifically preventing the occurrence of the non-productive event in the target mRNA.

ASO arrays utilize clinically translatable previously-validated ASO chemistries, such as 2’ methoxyethyl phosphorothioate and PMO.

Hit compounds are evaluated in wild-type animal models to identify Lead ASOs that possess suitable efficacy and safety to merit preclinical development.

Hit compounds are evaluated in vivo to identify Lead ASOs that possess suitable efficacy and safety to merit preclinical development.

Lead ASOs are subsequently evaluated in animal disease models or ex vivo disease model systems.

2 unchanged sentences

Program-specific criteria include, among other relevant factors, the severity of the unmet medical need, the likelihood of therapeutic utility, the feasibility of clinical development, the costs of development and the commercial opportunity.

Portfolio-wide considerations include the ability to demonstrate

technical success for our platform, thereby increasing the probability of success and learnings for subsequent programs.

Portfolio-wide considerations include the ability to demonstrate technical success for our platform, thereby increasing the probability of success and learnings for subsequent programs.

We believe that the learnings from our lead Dravet syndrome program will significantly reduce the uncertainty of development of subsequent programs in our pipeline, particularly those targeting the CNS.

Clinical trial and regulatory execution

We employ a multi-pronged approach to bring new treatments forward as rapidly as possible.

We employ a multi-pronged approach to bring new product candidates forward as rapidly as possible.

Our approach leverages previously-validated ASO chemistry and a modality that has been successfully utilized for other diseases, to minimize potential safety concerns and development risk.

In August 2020, we dosed the first patient in the MONARCH Study for our lead program in Dravet syndrome with a design and endpoints common to other recently approved antiepileptic drugs.

We have two ongoing Phase 1/2a open-label studies of STK-001 for Dravet syndrome, MONARCH in the United States and ADMIRAL in the United Kingdom, each with a design and endpoints common to the trials for approved anti-seizure medications (“ASMs”).

Commercialization

We intend to retain broad commercial rights and independently bring our therapies to patients through a lean, targeted internal commercial organization.

To do this, we are focused on ensuring that we can effectively identify and access those patients who will benefit from our therapies.

We intend to retain broad commercial rights and independently bring our therapies to patients through a lean, targeted internal commercial organization where we believe we can realize maximum value.

To do this, we are focused on ensuring that we can effectively identify and access those patients who may benefit from our product candidates.

We target diseases in which genetic testing is routinely performed, thereby shortening the diagnostic odyssey and enabling rapid identification of patients who harbor the relevant genetic mutations.

We have partnered with Invitae, a leading genetic information company, to provide genetic testing at no cost to the patient.

We have partnered with Invitae, a leading genetic information company, to provide genetic testing for pediatric epilepsy at no cost to patient.

Lastly, to maximize patient access, we aim to leverage an established network of academic and tertiary centers with extensive experience with analogous drug administration.

Therapeutic focus and product candidates

We believe our ASOs can be applied to treat a wide range of severe genetic diseases, and we have carefully designed and prioritized our pipeline strategy to maximize this opportunity.

We are focused on applying the transformative potential of our platform to developing medicines for patients with diseases where the genetic abnormality is known and is found in a single gene.

We believe our ASOs can be applied to treat a wide range of severe diseases, and we have carefully designed and prioritized our pipeline strategy to maximize this opportunity.

We are focused on applying the transformative potential of our TANGO platform to developing medicines for patients with diseases where the genetic abnormality is known and is found in a single gene.

We therefore know for a given disease precisely which gene will need to be upregulated, thus mitigating against the uncertainty of the disease biology.

We are currently focused on developing product candidates to treat autosomal dominant haploinsufficiency diseases, or disorders in which one copy of a gene is mutated and results in approximately 50% of normal protein expression.

Within haploinsufficiencies, we believe that no other disease area holds as clear a need or as much promise for near-term medical breakthrough as genetic epilepsies, including Dravet syndrome, and therefore we are prioritizing this disease area for our near-term development efforts.

Genetic epilepsies

Epilepsy is defined as recurrent, unprovoked seizures due to abnormal, asynchronized neuronal firing in the brain.

Epilepsy is the fourth most common neurologic disease and affects more than 50 million people worldwide, according to the World Health Organization as of 2019.

Epilepsy is the most frequent serious chronic neurologic condition in childhood, and approximately one out of 150 children are diagnosed with epilepsy during the first 10 years of life, with the highest incidence rate observed during infancy, according to a 2017 publication in Pediatrics .

More than 30% of patients with epilepsy are refractory to medical treatment, especially those with a genetic epilepsy, despite the availability of approximately 20 antiepileptic drugs.

This is largely because existing antiepileptic drugs primarily address the frequency of seizures and lack the capacity to rectify the underlying neuropathological processes or genetic defect.

Refractory epilepsy carries the risks of structural damage to the brain and nervous system and increased risk of premature death (e.g.

from sudden unexpected death in epilepsy, or SUDEP, suicide, accidents, pneumonia, or vascular disease), as well as psychological, educational, social and vocational consequences.

In addition, up to 50% of patients with epilepsy have significant cognitive delay, according to a 2015 review article in Cold Spring Harbor Perspectives .

Cognitive and behavioral comorbidities are especially common in children with refractory epilepsy.

Overall outcomes in patients with epilepsy have not improved significantly over the past two decades, and a novel therapeutic approach is desperately needed to modify the development or progression of the disease and improve long-term outcomes.

A 2010 publication in Nature Reviews Neurology estimates that more than 50% of epilepsies are now recognized as having a genetic basis, and many of these are haploinsufficiencies.

The genetic bases of both rare and common epilepsies are rapidly being elucidated, and neurologists now routinely include genetic testing for more than 180 disease-associated genes in the diagnostic work-up of epilepsy.

Beyond diagnostics, a major goal of genetic testing is to enable individualized treatment choices based on the genetic cause of disease.

Today, the application of genetic diagnosis for epilepsy patients is largely limited to medical contraindications, such as avoidance or removal of ion channel blockers for an ion channel deficiency, given that there are no genetically-targeted medicines available for genetic epilepsy patients.

Several hundred epilepsy-related genes have been identified to date, including genes encoding neuronal ion channels and receptors and genes involved in cellular signaling.

For example, the number of genes included on the epilepsy panel of Invitae Corporation, a leading genetic information company, has grown from 103 in 2015 to greater than 300 in 20 20 .

Globally, advances in molecular technology are expected to result in discoveries of additional genetic etiologies of epilepsy, implying a greater role than ever before for genetics in the epilepsy clinic.

The table below lists select genes that are commonly mutated amongst patients with epilepsy and we believe are amenable to TANGO, with current estimates of their prevalence.

We continu e to evaluate these CNS targets .

Estimated worldwide prevalence

Dravet Syndrome

5-5.5 in 100,000

Tuberous Sclerosis 2

7-8 in 100,000

Rett Syndrome

Tuberous Sclerosis 1

2-3 in 100,000

Epileptic Encephalopathy

1-2 in 100,000

CHD2-Myoclonic Epilepsy

1-2 in 100,000

Autosomal Dominant Mental Retardation 5

Epileptic Encephalopathy

Episodic Ataxia, Type 2

<1 in 100,000

For some genes, the phenotypic spectrum expands beyond the epilepsies to other neurodevelopmental disorders, including autism and intellectual disability.

For example, although most patients with mutations in STXBP1 , SYNGAP1 or CHD2 present with seizures, mutations in these genes have also been identified in individuals with intellectual disability or autism spectrum disorder, but without epilepsy.

These neurodevelopmental disorders are not addressed with existing antiepileptic drugs.

Dravet syndrome disease overview

Within haploinsufficiencies, we are prioritizing genetic diseases of the CNS and the eye for our near-term development efforts.

Our Development Programs

Our technology, development experience and scientific knowledge in the field of biologics, RNA splicing, and antisense oligonucleotide chemistry has enabled us to build a pipeline of programs targeting the underlying cause of severe diseases.

Exhibit 7 below represents a summary of our programs, which are focused on genetic diseases of the CNS and eye.

Stoke corporate presentation, March 2022

STK-001 for the treatment of Dravet syndrome

STK-001 is an investigational new medicine for the treatment of Dravet syndrome currently being evaluated in ongoing clinical trials.

We believe that STK-001 has the potential to be the first disease-modifying therapy to address the genetic cause of Dravet syndrome.

STK-001 is designed to upregulate Na v 1.1 protein expression by leveraging the non-mutant (wild-type) copy of the SCN1A gene to restore physiological Na v 1.1 protein levels, thereby reducing both occurrence of seizures and significant non-seizure comorbidities.

Disease Overview

Dravet syndrome is one of the most severe genetic epilepsies and affects approximately 6.4 in 100,000 people worldwide, including 5-5.5 in 100,000 people who possess a mutation in the SCN1A gene, according to a 2018 market research report commissioned by us and prepared by Health Advances, LLC, or the Health Advances Report.

13 unchanged sentences

The cognitive impairment in Dravet syndrome is not purely a consequence of seizures.

Patients with few seizures have been observed to possess severe encephalopathy, and conversely patients with frequent seizures have been observed to exhibit relatively minimal cognitive decline.

Patients with few seizures have been observed to possess severe encephalopathy, and conversely patients with frequent seizures have been observed to

exhibit relatively minimal cognitive decline.

In addition, there does not appear to be a correlation between cognitive outcome and SCN1A mutation type, whether a missense or truncating mutation.

Importantly, patients with Dravet syndrome have an increased risk of premature death, primarily due to SUDEP.

Importantly, patients with Dravet syndrome have an increased risk of premature death, primarily due to SUDEP, or Sudden Unexpected Death in Epilepsy.

Dravet syndrome patients have the highest SUDEP rate of any epilepsy.

An analysis of mortality in the Epilepsy Genetics Research Program demonstrated a Dravet syndrome-specific mortality rate of 15.84 per 1,000 patient years.

SUDEP was the

most common cause of premature death among Dravet syndrome patients (59%), equating to a Dravet syndrome-specific SUDEP rate of 9.32 per 1,000 patient-years.

SUDEP was the most common cause of premature death among Dravet syndrome patients (59%), equating to a Dravet syndrome-specific SUDEP rate of 9.32 per 1,000 patient-years.

This is nearly twice the rate for adults with refractory epilepsy.

5 unchanged sentences

Current treatments

Current treatments for Dravet syndrome only address the occurrence of seizures, not the underlying cause, and according to a 2017 study as published in the Developmental Medicine & Child Neurology Journal, more than 90% of Dravet syndrome patients still report suffering from incomplete seizure control with existing antiepileptic regimens.

As a result, the current treatment strategy involves the use of multiple antiepileptic drugs, including combinations of cannabidiol, stiripentol, clobazam, valproate, topiramate and others.

As a result, the current treatment strategy involves the use of multiple ASMs, including combinations of cannabidiol, stiripentol, clobazam, valproate, topiramate and others.

Patients are typically treated with two to four drugs administered concomitantly, and in most cases the relief provided by polytherapy is insufficient.

Cannabidiol (Epidiolex), fenfluramine (Fintepla) and stiripentol (Diacomit) are currently the only FDA-approved antiepileptic drugs for the treatment of Dravet syndrome.

Epidiolex was approved in 2018 for the adjunctive treatment of seizures associated with Lennox-Gastaut syndrome and Dravet syndrome in patients two years of age and older.

Diacomit was approved in 2018 for the treatment of seizures associated with Dravet syndrome in patients two years of age and older taking clobazam.

There are no clinical data to support the use of Diacomit as monotherapy in Dravet syndrome.

These therapies were approved based on a demonstrated reduction in seizure frequency;

however, very few patients had complete control of seizure activity.

For patients treated with Epidiolex, only 6.7% reported no convulsive seizures during the treatment period, according to clinical trial data in the drug’s prescribing information.

Tolerance, or a significant diminishment of efficacy over time, is also observed in approximately 25% of patients, thereby limiting the usefulness of this treatment in the long-term clinical management of patients with Dravet syndrome.

Additionally, cannabinoids as a drug class have been associated with adverse effects on cognitive development in children.

Fintepla is an antiepileptic drug approved in the U.S.

in 2020 for the treatment of seizures associated with Dravet syndrome in patients two years of age and older with Dravet syndrome;

however, as with Epidiolex and Diacomit, seizure-free rates remain in the low single digits.

None of these approved medicines address the significant non-seizure comorbidities.

Moreover, patients are still likely to be affected by non-seizure comorbidities and may develop tolerance to the drugs over time.

Many of the antiepileptic drugs that are used to treat Dravet syndrome can carry a substantial adverse event burden.

Some of the adverse events can cause deleterious effects on cognition and lead to sedation, somnolence, inattention and fatigue, and potentially lead to death.

These adverse effects may exacerbate the underlying cognitive deficits that are part of the natural course of Dravet syndrome.

Patients often require regular office visits and laboratory testing to monitor toxicity to vital organ systems, especially the liver, which may be further compounded by polytherapy and associated drug-drug interactions.

Despite these risks, the continued use of these medications demonstrates the importance of reducing the frequency of seizures to the patients, caregivers and the prescribing neurologists.

Cannabidiol (Epidiolex), fenfluramine (Fintepla) and stiripentol (Diacomit) are currently the only FDA-approved ASMs for the treatment of Dravet syndrome.

None of these approved ASMs address the significant non-seizure comorbidities.

Moreover, patients are still likely to be affected by non-seizure comorbidities and may develop tolerance to these ASMs over time.

Patients with Dravet syndrome need a novel therapeutic that addresses the genetic basis of the disease and treats the large number of seizures and multiple seizure types that persist despite treatment with existing therapy.

1 unchanged sentence

If STK-001 is approved by the FDA, we believe our precision medicine approach may have a profound impact on individuals and families.

Product candidate

We believe that STK-001 has the potential to be the first disease-modifying therapy to address the genetic cause of Dravet syndrome by restoring physiological Na v 1.1 levels and reducing both occurrence of seizures and significant non-seizure comorbidities.

Preclinical data

We have generated compelling preclinical data that demonstrates proof-of-mechanism for STK-001.

We have generated compelling preclinical data that demonstrate proof-of-mechanism for STK-001.

Our initial target engagement, pharmacology and efficacy studies were performed in mice, including both wild-type and a Dravet syndrome mouse model.

The Dravet syndrome mouse model replicates many of the symptoms of Dravet syndrome patients, and the targeted non-productive splicing event in SCN1A is highly conserved across multiple species, including mouse, non-human primates and humans.

The targeted non-productive splicing event in SCN1A is highly conserved across multiple species, including mouse, non-human primates and humans.

The target sequence for STK-001 is also identical across species.

In wild-type mice, we characterized target engagement and pharmacology of STK-001.

Five groups of neonate (postnatal day two) mice were administered a single injection dose of 0 (n=5), 0.3, (n=5) 1.0 (n=6) 3.0 (n=3) and 10.0 (n=5) µg of STK-001 by intracerebroventricular injection and returned to the home cage for five days.

Sections of the brain were processed for RNA and protein.

We observed that treatment with STK-001 resulted in a dose-dependent reduction of non-productive mRNA.

Furthermore, the reduction of non-productive mRNA was associated with an increase of productive mRNA and an increase in Na v 1.1 protein, as denoted in the figures below.

We also evaluated STK-001 pharmacology and efficacy in transgenic mice with a heterozygous deletion of Scn1a .

We evaluated STK-001 pharmacology and efficacy in transgenic mice with a heterozygous deletion of Scn1a .

This model was created by introducing a targeted deletion in the first coding exon of the Scn1a gene;

7 unchanged sentences

n=10 wild-type mice, n=10 Dravet syndrome mice).

Notably, a single injection of STK-001 restored Na v 1.1 protein in Dravet syndrome mice to levels that are near those of the wild-type mice at both 7 and 14 weeks.

Notably, a single injection of STK-001 restored Na v 1.1 protein in Dravet syndrome mice to levels that are near those of the wild-type mice at both 7 and 14 weeks as shown in exhibit 8 .

These data demonstrate that STK-001 has an impact on Na v 1.1 protein expression and we believe this may translate to a favorable dosing regimen in humans.

Han et al ., Science Trans Med, 2020

In addition to an increase in the Na v 1.1 protein, the administration of a single dose of 20 µg of STK-001 in neonate Dravet syndrome mice (postnatal day two) resulted in a significant reduction in premature mortality.

Treatment with STK-001 resulted in 97% survival of Dravet syndrome mice for the 90-day post-natal observation period (survival of 33 out of 34 mice was observed in the STK-001 Dravet syndrome mouse group) compared with 23% survival of placebo-treated mice (survival of 14 out of 62 mice).

This is illustrated in the figure below.

In additional studies, Dravet syndrome mice were treated closer to symptom onset (postnatal day 14).

An interim analysis through postnatal day 35 indicated a significant reduction in premature mortality.

Treatment with a single dose of 60 µg of STK-001 resulted in 98% survival of Dravet syndrome mice for the 35-day post-natal observation period (survival of 45 out of 46 mice was observed in the STK-001 Dravet syndrome mouse group) compared with 71% survival of placebo mice (survival of 32 out of 45 mice).

This is illustrated in the figure below.

This is illustrated in exhibit 9.

Han et al ., Science Trans Med, 2020

Further preclinical studies of STK-001 have shown significant reductions in seizure frequency in a mouse model of Dravet syndrome (DS).

9 unchanged sentences

Similar analysis was performed in wild-type and Dravet syndrome mice treated with 20 µg of STK-001 at 7 and 14 weeks after dosing.

STK-001 treated samples showed an increase in expression of the SCN1A gene, but not any of the other SCN family members.

As illustrated in exhibit 10, STK-001 treated samples showed an increase in expression of the SCN1A gene, but not any of the other SCN family members.

These biological studies demonstrate that STK-001 is highly specific for SCN1A among the highly homologous family of sodium channel genes, limiting the likelihood of off-target activities.

8 unchanged sentences

Additionally, all doses tested showed no drug-related toxicities, including no changes in platelet counts or hepatic function, no clinical signs or symptoms over the 28-day period after administration and no abnormal histopathology.

These data were presented at the American Epilepsy Society (AES) Annual Meeting in Baltimore in December 2019.

Single dose GLP toxicology studies in rats and cynomolgus monkeys, that characterized the pharmacology, exposure and tolerability of STK-001 were included in the IND that was submitted to the FDA in late 2019.

These studies provided data to support the initiation of the Phase 1/2a single ascending dose clinical study.

Dravet syndrome clinical program—STK-001

Single dose GLP toxicology studies in rats and cynomolgus monkeys, that characterized the pharmacology, exposure and tolerability of STK-001 were included in the investigational new drug application (the “IND”) that was submitted to the FDA in late 2019.

Additional multiple dose GLP toxicology data have subsequently been submitted to the FDA and the MHRA (UK regulatory agency) to support multiple dosing in the clinic.

Clinical program and data

We designed our lead product candidate, STK-001, to treat Dravet syndrome, a severe and progressive genetic epilepsy.

This program draws on a well-defined patient population based on routine genetic testing and learnings from drugs approved for the treatment of Dravet syndrome to inform the clinical and regulatory pathways for STK-001.

We submitted an investigational new drug application (“IND”) for STK-001 to the U.S.

Food and Drug Administration (the “FDA”) in late 2019.

In August 2020, we dosed the first patient with STK-001 in the single ascending dose portion of the MONARCH Phase 1/2a Study at the 10mg dose level.

The MONARCH Study is designed to evaluate single and multiple ascending dose levels of STK-001 in children and adolescents with Dravet syndrome.

We have two ongoing Phase 1/2a open-label studies of STK-001, MONARCH in the United States and ADMIRAL in the United Kingdom.

The MONARCH Study is designed to evaluate single and multiple ascending dose levels of STK-001 administered intrathecally in children and adolescents with Dravet syndrome.

Patients are eligible for the trial if they are between the ages of 2 to 18, have an established diagnosis of Dravet syndrome and have evidence of a pathogenic genetic mutation in the SCN1A gene.

Requiring an SCN1A mutation (of which more than 1,700 SCN1A mutations have been identified) for trial enrollment allows for a clear and definitive etiologic diagnosis, a more homogeneous patient population and tailored treatment based on a precision medicine approach.

Eligible patients will also have failed at least two epilepsy treatments in the past and currently be taking at least one antiepileptic drug.

All medications and interventions will remain unchanged throughout the trial, which will allow for assessment of STK-001 with a variety of antiepileptic therapies.

The primary objectives are the assess ment of the safety and tolerability of STK-001, as well as to characterize human pharmacokinetics.

A secondary objective is to assess the efficacy as an adjunctive antiepileptic treatment with respect to the percentage change from baseline in convulsive seizure frequency over a 12-week treatment period.

We are measur ing non-seizure aspects of the disease, such as quality of life as secondary endpoints.

Requiring an SCN1A mutation for trial enrollment allows for a clear and definitive etiologic diagnosis, a more homogeneous patient population and tailored treatment based on a precision medicine approach.

Eligible patients will also have failed at least two epilepsy treatments in the past and currently be taking at least one ASM.

All medications and interventions will remain unchanged throughout the trials, which will allow for assessment of STK-001 with a variety of ASMs.

The primary objectives are the assessment of the safety and tolerability of STK-001, as well as to characterize blood pharmacokinetics (“PK”) and cerebrospinal fluid (“CSF”) exposure levels.

A secondary objective is to assess the efficacy of STK-001 as an adjunctive ASM treatment with respect to the percent change from baseline in convulsive seizure frequency over a 12-week treatment period.

We are measuring non-seizure aspects of the disease, such as quality of life as secondary endpoints.

These endpoints as well as other exploratory endpoints will be informed based on our two-year observational study (BUTTERFLY).

2 unchanged sentences

Data from the study will support clinical development plans for STK-001.

Initial data from BUTTERFLY suggest that commonly used cognition assessments, BSID-III (Bayley Scales of Infant Development, Third Edition), and WPPSI-IV (Wechsler Preschool and Primary Scale of Intelligence, Fourth Edition) may be useful for clinical studies assessing neurodevelopment and adaptive behavior in patients with Dravet syndrome.

All three assessments showed relatively low intra-patient variability and no significant change from baseline three months after baseline assessments for all 36 patients enrolled.

In March 2020, we announced the FDA had placed a partial clinical hold on doses of STK-001 above 20mg in the MONARCH Study, pending additional preclinical testing to determine the safety profile of doses higher than the current no observed adverse effect level (“NOAEL”).

4 unchanged sentences

There is no apparent correlation of these acute adverse events with the mechanism of action of STK-001.

Following interactions with the FDA, in October 2020, we announced that the FDA agreed to allow us to add an additional higher dose level to the SAD portion of the study such that a total of three dose levels will be evaluated:

10 mg, 20 mg, and 30mg.

Since March 2020, the FDA has agreed to allow us to add additional higher dose levels to the MONARCH study.

The study is currently permitted to evaluate single doses (10mg, 20mg, 30mg or 45mg) and multiple doses administered monthly for three months (20mg, 30mg or 45mg).

Dosing above 45mg in this study remains on FDA partial clinical hold.

In addition, a multiple ascending dose (“MAD”) portion was added to the MONARCH Study based on preclinical repeat-dose toxicology data, which were reviewed by the FDA.

There were no adverse effects observed in the NHP repeat dose study.

Enrollment and dosing in the first two cohorts (10mg and 20mg) of the single ascending dose portion of the study are now complete.

Enrollment and dosing of patients in the 30mg single ascending dose cohort is now underway.

In February 2021, the first patient in the MAD portion of the study was dosed with STK-001 at the 20mg level.

We expect to announce initial safety and pharmacokinetic data from the SAD portion of the MONARCH Study in the second half of 2021.

The ADMIRAL study is a Phase 1/2a open-label study of children and adolescents ages 2 to <18 who have an established diagnosis of Dravet syndrome and have evidence of a genetic mutation in the SCN1A gene.

The primary objectives for the study are to assess the safety and tolerability of multiple doses of STK-001 up to 70mg, as well as to determine the pharmacokinetics in plasma and exposure in cerebrospinal fluid.

A secondary objective is to assess the effect of multiple doses of STK-001 as an adjunctive antiepileptic treatment with respect to the percentage change from baseline in convulsive seizure frequency over a 24-week treatment period.

We are measuring non-seizure aspects of the disease, such as overall clinical status and quality of life, as secondary endpoints.

In the second half of 2021, we announced positive interim safety, PK, CSF exposure, and efficacy data from the MONARCH study.

The interim analysis was based on data from 22 patients who were treated in the single 10mg (n=5), 20mg (n=4), or 30mg (n=7) dose cohorts of STK-001 and who were followed for at least three months after their last dose.

Also included in this analysis were six patients from the 20mg MAD dose cohort, most of whom had received three monthly doses of STK-001.

Key findings from the interim analysis include:

Single doses of STK-001 up to 30mg, and three 20mg doses of STK-001 given every four weeks were found to be well tolerated with no safety concerns related to the study drug.

The most common treatment-emergent adverse events (“TEAEs”) were headache, vomiting, seizure, irritability, and back pain.

18.2% (4/22) of patients experienced a TEAE that was related to study drug, none of which were severe.

22.7% (5/22) patients had a serious treatment-emergent adverse event (“SAE”), none of which were related to study drug.

70.6% (12/17) patients treated with single doses (10mg, 20mg, 30mg) or multiple doses (20mg) of STK-001 experienced a reduction from baseline in convulsive seizure frequency measured from Day 29 to Day 84 after receiving their first dose of STK-001.

All patients ages 2-12 (n=7) experienced a reduction from baseline in convulsive seizure frequency measured from Day 29 to Day 84.

Reductions in seizure frequency were also observed among patients ages 13-18 in the higher dose cohorts.

This is illustrated in exhibits 11 and 12 below

Interim Safety, PK, and CSF Exposure Data from the Phase 1/2a MONARCH Study of STK-001, an Antisense Oligonucleotide (AS0), in Children and Adolescents with Dravet Syndrome (DS) (AES 2021)

Across all cohorts median reductions of 17% to 37% from baseline in convulsive seizure frequency from Day 29 to Day 84 were observed.

This is illustrated in exhibit 13 shown below.

Interim Safety, PK, and CSF Exposure Data from the Phase 1/2a MONARCH Study of STK-001, an Antisense Oligonucleotide (AS0), in Children and Adolescents with Dravet Syndrome (DS) (AES 2021)

In 2021, a population PK model for intrathecal STK-001 was developed using non-human primate data and was scaled and adjusted using clinical data to predict STK-001 concentrations in plasma, CSF, and brain in pediatric patients with Dravet syndrome.

STK-001 levels in plasma and CSF in patients treated with STK-001 correlated very well with model predictions, indicating that plasma and CSF levels observed in patients are good predictors of STK-001 brain levels in

Modeling of clinical data also suggest that more than 95% of patients are predicted to have pharmacologically active STK-001 brain levels following three doses of 30mg administered one month apart and half of all patients are anticipated to maintain greater than minimum pharmacologically active levels of STK-001 for approximately three months after their last dose as shown in as shown in exhibit 14.

A Pharmacokinetic (PK) Model for STK-001, an Antisense Oligonucleotide (AS), Based on Data from Non-human Primates (NHP) Enables Dose Selection in Patients with Dravet Syndrome (DS) (AES 2021)

MONARCH and ADMIRAL continue to progress with enrollment and dosing of patients ongoing.

We expect to announce preliminary clinical data on 30mg MAD doses of STK-001 in the second half of 2022.

Enrollment and dosing of patients is ongoing in the 45mg SAD cohort of MONARCH.

The first patients have also been dosed with STK-001 at 45mg in the ADMIRAL study, which is a multiple ascending dose study.

In January 2021, we initiated enrollment and dosing in our SWALLOWTAIL Open Label Extension (OLE) study of STK-001 for children and adolescents with Dravet syndrome.

SWALLOWTAIL is designed to evaluate the long-term safety and tolerability of repeated doses of STK-001 in patients with Dravet syndrome who previously participated in studies of STK-001.

Patients who participated in the MONARCH study and meet study entry criteria are eligible to continue treatment in SWALLOWTAIL which is designed to evaluate the long-term safety and tolerability of repeated doses of STK-001.

SWALLOWTAIL will also provide valuable information on the preliminary effects of STK-001 on seizures along with non-seizure aspects of the disease, such as quality of life and cognition.

In this study, patients will initially be administered the same dose level they received in the previous study and will receive a maximum of three doses.

One dose will be administered every four months.

In December 2021 we presented initial data from the SWALLOWTAIL study that demonstrated that multiple doses up to 30mg of STK-001 intrathecally every four months appears to be well tolerated.

Enrollment and dosing in SWALLOWTAIL are underway.

While we continue working to minimize any potential delay to continued clinical testing of STK-001, we expect that the COVID-19 pandemic may directly or indirectly impact the timeline.

Our ability to continue the clinical trial or initiate the MAD portion of the clinical trial may be adversely affected, directly or indirectly, by the COVID-19 pandemic.

For example, although our Phase 1/2a study of STK-001 for the treatment of Dravet syndrome has not been delayed, we plan to have clinical trial sites in various parts of the United States, some of which have had high incident rates of COVID-19 patients.

Our ability to continue the clinical trials may be adversely affected, directly or indirectly, by the COVID-19 pandemic.

For example, although MONARCH and ADMIRAL have not been delayed, we plan to have clinical trial sites in various parts of the United States and the United Kingdom, some of which have had high incident rates of COVID-19 patients.

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

1 unchanged sentence

We have not yet discussed with regulatory authorities the evidence necessary for approval of STK-001.

However, in addition to requesting Fast Track Designation, if we see evidence of clinical efficacy, then we would plan to meet with regulatory authorities to discuss expedited regulatory pathways.

Program update

Autosomal Dominant Optic Atrophy program

In November 2020, we announced the nomination of OPA1 as our next target for preclinical development to treat Autosomal Dominant Optic Atrophy (“ADOA”).

ADOA is the most common inherited optic nerve disorder seen in clinical practice and causes progressive and irreversible vision loss in both eyes starting in the first decade of life.

However, if we see evidence of clinical efficacy as we dose escalate, then we would plan to meet with regulatory authorities to discuss expedited regulatory pathways.

STK-002 for the treatment of Autosomal Dominant Optic Atrophy (ADOA)

STK-002 is our lead clinical candidate for the treatment of ADOA.

STK-002 is designed to upregulate OPA1 protein expression by leveraging the non-mutant (wild-type) copy of the OPA1 gene to restore OPA1 protein expression with the aim to stop or slow vision loss in patients with ADOA.

To date, we have generated preclinical data demonstrating proof-of-mechanism and proof-of-concept for STK-002.

Based on preclinical data generated to date, we believe that STK-002 has the potential to be the first disease-modifying therapy for people living with ADOA.

Preclinical toxicology studies are underway to support future clinical trials for STK-002.

Disease Overview

ADOA is the most common inherited optic nerve disorder seen in clinical practice.

ADOA causes progressive and irreversible vision loss in both eyes starting in the first decade of life.

Many children progress to blindness.

1 unchanged sentence

The disease affects one in 30,000 people globally with a higher incidence of approximately one in 10,000 in Denmark due to a founder effect.

65% to 90% of ADOA is caused by mutations in one allele of the OPA1 gene, most of which lead to

haploinsufficiency and disease manifestation.

65% to 90% of ADOA is caused by mutations in one allele of the OPA1 gene, most of which lead to haploinsufficiency and disease manifestation.

More than 400 different OPA1 mutations have been reported in people diagnosed with ADOA.

2 unchanged sentences

OPA1 is a dynamin-related GTPase that plays a key role in maintaining mitochondria structure and dynamics.

The OPA1 protein is imported into the mitochondria and is the crucial molecule that mediates inner mitochondria membrane fusion and cristae morphogenesis and is critical for oxidative phosphorylation and ATP synthesis.

Insufficient OPA1 activity causes mitochondria dysfunction with consequent insufficient ATP production, excess reactive oxygen species production and eventual cell death.

17 unchanged sentences

The prognosis for many patients with ADOA is poor and the rate of visual loss can be difficult to predict given significant inter- and intra-familial variability.

Current Treatments

There are currently no available treatments for ADOA.

2 unchanged sentences

Our ASOs are designed to target the underlying cause of ADOA, which is OPA1 haploinsufficiency, by decreasing a non-productive mRNA splicing event in the OPA1 gene to increase productive OPA1 mRNA and OPA1 protein in the retinal ganglion cells.

OPA1 preclinical data for the potential treatment of ADOA

We previously identified a novel exon inclusion event (“Exon X”) in OPA1 that leads to non-productive mRNA due to introduction of a premature termination codon (“PTC”) (Figure 1 below).

In April 2020 and June 2020, we provided data in presentations at the American Society of Gene & Cell Therapy and the Association for Research in Vision and Ophthalmology meetings, respectively, showing that ASO-14 blocked the incorporation of Exon X with consequent dose-dependent increase in productive OPA1 mRNA and protein due to reduction of Exon X-directed non-sense mediated decay (“NMD”) of OPA1 mRNA (Figure 2 below).

We have now demonstrated that a single injection of ASO-14 surrogate in the rabbit eye leads to a dose-dependent increase in ASO accumulation in the retina that correlated with an increase in target engagement (removal of Exon X) and an increase in OPA1 protein (Figure 3 below).

The study was conducted using female NZW rabbits that were injected with a single dose of vehicle alone or vehicle containing ASO (n=3/group).

Preclinical data

We previously identified a novel exon inclusion event (“Exon X”) in OPA1 that leads to non-productive mRNA due to introduction of a premature termination codon (“PTC”) (exhibit 15 below).

Our preclinical studies showed that our ASOs blocked the incorporation of Exon X with consequent dose-dependent increase in productive OPA1 mRNA and protein due to reduction of Exon X-directed non-sense mediated decay (“NMD”) of OPA1 mRNA (exhibit 16 below).

The study was conducted using female New Zealand white rabbits that were injected with a single dose of vehicle alone or vehicle containing ASO (n=3/group).

On Days 15 and 29, the retinal tissue was collected and analyzed.

Specifically, we learned that retinal exposure of ASO-14 surrogate (ST-1102) was elevated with increased dosing, dose-dependent target engagement was seen at all three time-points examined, and protein increase of OPA1 protein was observed at both Day 15 and Day 29 of the study.

We further showed that in OPA1 haploinsufficient human cells, ASO-14-mediated increase in OPA1 protein translates to improved mitochondrial function as measured by the substantial restoration of Adenosine triphosphate (“ATP”) levels in the treated cells (Figure 4 below).

Retinal exposure of ASO-14 surrogate (ST-1102) was elevated with increased dosing, dose-dependent target engagement was seen at all three time-points examined, and protein increase of OPA1 protein was observed at both Day 15 and Day 29 of the study.

We further showed that in OPA1 haploinsufficient human cells, ASO-14-mediated increase in OPA1 protein

translates to improved mitochondrial function as measured by the substantial restoration of ATP levels in the treated cells (exhibit 18 below).

ATP is produced by the mitochondria and is the key energy carrying molecule in cells.

4 unchanged sentences

Rabbit ASO demonstrates dose-dependent OPA1 protein increase in rabbit retina

Venkatesh A, et al.

Antisense oligonucleotide mediated increase of OPA1 expression using TANGO technology for treatment of autosomal dominant optic atrophy.

Presented at The Association for Research in Vision and Ophthalmology;

May 3-7, 2020;

Baltimore, MD.

Human ASO demonstrates ATP upregulation in OPA1 haploinsufficient HEK293 cells

** = P value 0.0006

*** = P value <0.0001

### = P value 0.0006

We believe our preclinical data to date support the use of our TANGO technology to treat ADOA due to OPA1 haploinsufficiency.

We have observed that ASO-mediated specific reduction in non-productive OPA1 mRNA provides an increase in productive OPA1 mRNA and an increase in OPA1 protein in a dose-dependent manner in vitro .

We have also observed dose-dependent ASO exposure and consequent reduction in non-productive mRNA and increase in OPA1 protein in vivo in the rabbit retina.

Test compounds were well-tolerated in wild-type rabbit for up to 29 days after intravitreal injection (maximum days evaluated).

ASO-mediated increase in OPA1 protein levels in OPA1 haploinsufficient cells correlated with a substantial restoration of mitochondrial function as measured by an increase in ATP synthesis capability.

The TANGO approach utilizes the wild-type OPA1 allele and can potentially be used to treat ADOA due to loss of OPA1 activity in a mutation-independent manner.

As with STK-001 for Dravet syndrome, our study and development of the use of our TANGO technology to treat ADOA is subject to the risks and uncertainties stemming from the COVID-19 pandemic, which may directly or indirectly impact our ability to pursue this new target, and the timing in which we do so.

In May 2021, we presented new preclinical efficacy data at The Association for Research in Vision and Ophthalmology (ARVO) Annual Meeting demonstrating that our TANGO ASOs can increase OPA1 protein levels and improve mitochondrial function in human cells derived from ADOA patients with different OPA1 mutations.

Exhibit 19 below demonstrates that our TANGO ASO increases OPA1 protein and ATP linked mitochondrial respiration in ADOA patient cells.

TANGO ASO increases OPA1 protein and ATP linked mitochondrial respiration in ADOA patient cells

Source (left graph):

Stoke data Source (right graph):

Venkatesh A, et al.

Antisense oligonucleotide mediated increase in OPA1 improves mitochondrial function in fibroblasts derived from patients with autosomal dominant optic atrophy (ADOA).

Presented at The Association for Research in Vision and Ophthalmology;

May 1-7, 2021.

As with STK-001 for Dravet syndrome, our study and development of STK-002 and the use of our TANGO technology to treat ADOA is subject to the risks and uncertainties stemming from the COVID-19 pandemic, which may directly or indirectly impact our ability to pursue this new target, and the timing in which we do so.

Additional product opportunities

We are also advancing additional programs focused on multiple targets, including haploinsufficiency diseases of the CNS, eye, kidney and liver, given the ability of our ASOs to target cells in these organs.

We are also advancing additional programs focused on multiple targets, including haploinsufficiency diseases of the CNS and eye.

These tissues are affected in many severe genetic diseases.

Longer-term, we believe that ASOs designed using TANGO may have the potential to upregulate non-mutated genes in biological pathways to treat diseases or conditions caused by multiple genes or are multifactorial, such as autoimmune diseases, aging and cancer.

For these diseases, we intend to opportunistically secure partnerships with pharma partners whose scientific, development or commercial capabilities complement our own.

For these diseases, we intend to opportunistically secure partnerships with biopharmaceutical partners whose scientific, development or commercial capabilities complement our own.

Acadia License and Collaboration Agreement

In January 2022, we entered into a license and collaboration agreement with Acadia Pharmaceuticals Inc.

(“Acadia”) for the discovery, development and commercialization of novel RNA-based medicines for the treatment of severe and rare genetic neurodevelopmental diseases of the CNS.

The agreement focuses on the targets SYNGAP1, MECP2 (Rett syndrome), and an undisclosed neurodevelopmental target of mutual interest.

In connection with each target, we will collaborate with Acadia to identify potential treatments for further development and commercialization as licensed products.

With respect to SYNGAP1, we have agreed with Acadia to co-develop and co-commercialize licensed products for such target globally, and in connection therewith we granted to Acadia worldwide, co-exclusive (with us) licenses for such licensed products.

With respect to MECP2 and the neurodevelopmental target, we granted to Acadia worldwide, exclusive licenses to develop and commercialize licensed products for such targets.

Pursuant to the terms of the agreement, we received an upfront payment of $60 million from Acadia.

Acadia agreed to fund the research to identify potential licensed products for MECP2 and the neurodevelopmental target, and we will equally fund with Acadia the research to identify potential licensed products for SYNGAP1.

We are e ligible to receive up to $907,500,000 in potential total milestone payments based upon the achievement of certain development, regulatory, first commercial sales and sales milestone events across the programs for the three targets, assuming each milestone were achieved at least once.

With respect to licensed products for MECP2 and the neurodevelopmental target, we are also eligible to receive tiered royalties at percentages ranging from the mid-single digits to the mid-teens on future net sales by Acadia of licensed products worldwide.

Royalties payable under the agreement are subject to standard royalty reductions.

For SYNGAP1 licensed products that we are co-developing and co-commercializing, we will be responsible for 50% of the development and commercialization costs and will receive 50% of the profits from global commercialization.

With respect to each SYNGAP1 licensed product being co-developed or co-commercialized, the agreement will remain in effect, unless earlier terminated, until the parties have agreed to permanently abandon the further development and commercialization of such licensed product.

With respect to licensed products for MECP2 and the neurodevelopmental target, the agreement will remain in effect, unless earlier terminated, until the expiration, on a country-by-country and licensed product-by-licensed product basis, of the applicable royalty term, at which point the license for such licensed product shall become fully paid-up, royalty-free, perpetual and irrevocable in such country.

The agreement also contains customary provisions for termination by Acadia for convenience and by either party for cause, including for material breach (subject to cure).

We have standard reversion rights in connection with certain early termination events.

SYNGAP1 syndrome is a rare neurological disorder characterized by moderate to severe intellectual disability that is evident in early childhood.

Mutations in the SYNGAP1 gene (which produces the SynGAP protein) were first identified in 2009 and since then, an increasing number of children with SYNGAP1 syndrome have been identified.

Normal levels of SynGAP protein are essential for proper brain function and development.

Mutations in the SYNGAP1 gene also play an important role in the development of epileptic encephalopathies (DEEs).

The severity and onset of symptoms can vary from patient to patient.

SYNGAP1 syndrome is characterized by developmental delay or intellectual disability, generalized epilepsy, and autism spectrum disorder (ASD) and other behavioral abnormalities.

More than 80% of cases of SYNGAP1 syndrome are caused by a haploinsufficiency of the SYNGAP1 gene.

SYNGAP1 syndrome is estimated to account for 1% to 2% of all intellectual disability cases.

There are currently no approved treatments for SYNGAP1 syndrome.

Rett syndrome is a rare, debilitating neurological disorder that occurs primarily in females following apparently normal development for the first six months of life.

Rett syndrome is often misdiagnosed as autism, cerebral palsy, or non-specific developmental delay.

Rett syndrome is caused by mutations on the X chromosome on a gene called MECP2.

There are more than 200 different mutations found on the MECP2 gene that interfere with its ability to generate a normal gene product.

Rett syndrome occurs worldwide in approximately one of every 10,000 to 15,000 female births and in the United States impacts 6,000 to 9,000 patients.

Rett syndrome causes problems in brain function that are responsible for cognitive, sensory, emotional, motor and autonomic function.

Typically, with symptoms presenting between 6 to 18 months of age, patients experience a period of rapid decline with loss of purposeful hand use (fine motor skills), development of hand stereotypies, absent or impaired mobility (gross motor skills), loss of communication skills (including eye contact) and inability to independently conduct activities of daily living.

Symptoms also include seizures, disorganized breathing patterns, an abnormal side-to-side curvature of the spine (scoliosis), and sleep disturbances.

Currently, there are no FDA-approved medicines for the treatment of Rett syndrome.

Business Update Regarding COVID-19

The current COVID-19 pandemic has presented a substantial public health and economic challenge around the world and is affecting our employees, patients, communities and business operations, as well as the U.S.

The current COVID-19 pandemic continues to present a substantial public health and economic challenge around the world and is affecting our employees, patients, communities and business operations, as well as the U.S.

economy and financial markets.

The full extent to which the COVID-19 pandemic will directly or indirectly impact our business, results of operations, liquidity and financial condition will depend on future developments that are highly uncertain and cannot be accurately predicted, including new information that may emerge concerning COVID-19, the actions taken to contain it or treat its impact and the economic impact on local, regional, national and international markets.

The full extent to which the COVID-19 pandemic will directly or indirectly impact our business, results of operations, liquidity and financial condition will depend on future developments that are highly uncertain and cannot be accurately predicted, including the timing and effectiveness of global efforts to roll out vaccines, new information that may emerge concerning COVID-19 and COVID-19 variants, the actions taken to contain it or treat its impact and the economic impact on local, regional, national and international markets.

To date, our third party contract research organizations (“CROs”), contract manufacturing organizations (“CMOs”), and other third-party vendors have been able to continue to provide services and supply reagents, materials, and products and currently do not anticipate any significant disruption in services or interruptions in supply.

1 unchanged sentence

Our third-party CMOs continue to operate their manufacturing facilities at or near normal levels.

While we currently do not anticipate any significant interruptions in our manufacturing processes, it is possible that the COVID-19 pandemic and response efforts may have an impact in the future on our third-party suppliers and CMOs ability to manufacture reagents, materials, or products that we need to use in our research and clinical trial.

However, we are continuing to assess the potential impact of the COVID-19 pandemic on our business and operations, including our expenses, our observational study, our clinical trial, and our ability to hire and retain employees.

Our ability to continue our observational study may be adversely affected, directly or indirectly, by the COVID-19 pandemic.

Currently we are monitoring patients in our observational study, including the duration and degree to which we may see delays in conducting in-person follow-ups, and disruptions in our ability to monitor patients due to hospitals closing sites or diverting the resources that are necessary to conduct our observational study.

While we continue to enroll and dose patients in our Phase 1/2a clinical trial at sites across the United States, we expect that COVID-19 precautions may directly or indirectly impact the timeline for some of our clinical trial activities due to hospitals closing sites and/or diverting the resources that are necessary to conduct clinical trials.

We are pursuing approaches to help mitigate the impact to our clinical trial.

Currently we have not experienced any delay in initiating our clinical trial.

The COVID-19 pandemic has caused us to modify our business practices (including but not limited to curtailing or modifying employee travel, moving to partial remote work, and cancelling physical participation in meetings, events and conferences) and we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, patients and business partners.

Our office-based employees have been working from home since early March 2020, while ensuring essential staffing levels in our operations remain in place, including maintaining key personnel in our laboratories.

While we currently do not anticipate any significant interruptions in our manufacturing processes, it is possible that the COVID-19 pandemic and response efforts may have an impact in the future on our third-party suppliers and CMO’s ability to manufacture reagents, materials, or products that we need to use in our research and clinical trial.

Our ability to continue our clinical trials and our observational study may be adversely affected, directly or indirectly, by the COVID-19 pandemic.

Currently we are monitoring patient enrollment and participation in our clinical trials and our observational study, including the duration and degree to which we may see declines in enrollment, delays in conducting in-person follow-ups, and disruptions in our ability to monitor patients due to hospitals closing sites or diverting the resources that are necessary to conduct our clinical trials and our observational study.

While we continue to enroll and

dose patients in our clinical trials at sites across the United States and the United Kingdom, we take into consideration that COVID-19 precautions may directly or indirectly impact the timeline for some of our clinical trial activities due to hospitals closing sites and/or diverting the resources that are necessary to conduct clinical trials.

We are pursuing approaches to help mitigate the impact to our clinical trials.

Currently we have not experienced any significant delays in our clinical trials due to COVID-19.

The COVID-19 pandemic has caused us to modify our business practices including but not limited to curtailing or modifying employee travel, moving to partial remote work, and minimizing some physical participation in meetings, events and conferences.

We continue to monitor our operations and applicable governmental recommendations, and we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, patients and business partners.

Our office-based employees had been primarily working from home from early March 2020 through early September 2021.

Since then, our office-based staff have been working in a hybrid-model fluctuating between work from home and work from the office.

Throughout the pandemic, we continue to ensure that essential staffing levels in our operations remain in place, including maintaining key personnel in our laboratories

For additional information on the various risks posed by the COVID-19 pandemic, please read Item 1A.

Risk Factors included in this annual report.

Manufacturing

26 unchanged sentences

If our current product candidate, STK-001, is approved for the treatment of Dravet syndrome, it may compete with other products currently marketed or in development.

Currently marketed antiepileptic drugs range from cannabidiols, such as GW Pharmaceuticals, plc’s Epidiolex, Fintepla® (fenfluramine) from Zogenix, to GABA receptor agonists, such as clobazam, to glutamate blockers, such as topiramate.

Companies such as Ovid Therapeutics/Takeda, Xenon Pharmaceuticals, and Encoded Therapeutics are also developing treatments for Dravet syndrome.

Many of the currently marketed antiepileptic drugs are available as generics.

Currently marketed anti-seizure medicines (ASMs) range from cannabidiols, such as Jazz Pharmaceuticals’ Epidiolex, Fintepla® (fenfluramine) from Zogenix, to GABA receptor agonists, such as clobazam and stiripentol, to glutamate blockers, such as topiramate.

Companies such as Ovid Therapeutics/Takeda, Xenon Pharmaceuticals, Eisai Pharmaceuticals, Longboard Pharmaceuticals and Encoded Therapeutics are also developing treatments for Dravet syndrome.

Many of the currently marketed ASMs are available as generics.

In addition, numerous compounds are in clinical development for treatment of epilepsy.

1 unchanged sentence

Importantly, we believe none of the drugs in clinical development address the underlying genetic cause of Dravet syndrome.

Our second product candidate, STK-002, is in development for treatment of Autosomal Dominant Optic Atrophy (ADOA).

There are no products currently marketed or in clinical development for treatment of ADOA.

To our knowledge, there are also very limited preclinical development efforts beyond our product candidate.

PYC Therapeutics is developing a cell penetrating peptide PMO conjugated to ASO for treatment of ADOA.

Many of our competitors, either alone or with strategic partners, have substantially greater financial, technical, and human resources than we do.

4 unchanged sentences

Our commercial opportunity could be substantially limited if our competitors develop and commercialize products that are more effective, safer, less toxic, more convenient or less expensive than our comparable products.

In geographies that are critical to our commercial success, competitors may also obtain regulatory approvals before us, resulting in our competitors building a

strong market position in advance of the entry of our products.

In geographies that are critical to our commercial success, competitors may also obtain regulatory approvals before us, resulting in our competitors building a strong market position in advance of the entry of our products.

In addition, our ability to compete may be affected in many cases by insurers or other third-party payors seeking to encourage the use of other drugs.

The key competitive factors affecting the succes s of all of our programs are likely to be their efficacy, safety, convenience and availability of reimbursement.

The key competitive factors affecting the success of all of our programs are likely to be their efficacy, safety, convenience and availability of reimbursement.

Reimbursement

2 unchanged sentences

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

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

In some foreign markets, prescription biopharmaceutical pricing remains subject

to continuing governmental control even after initial approval is granted.

As a result, a drug company can obtain regulatory approval for a product in a country, but then be subject to price regulations that delay commercial launch of that product.

22 unchanged sentences

With respect to our TANGO platform, we have exclusively licensed intellectual property for our TANGO technology from the University of Southampton and Cold Spring Harbor Laboratory, which includes issued U.S.

patents and pending

and foreign patents and pending U.S.

and foreign patent applications that cover the TANGO mechanisms.

As of December 31, 2021, the issued U.S.

patents, pending U.S.

patents, issued foreign patents, pending U.S.

patent applications and pending foreign patent applications that we have licensed from the University of Southampton are anticipated to expire between 2035 and 2036, absent any patent term adjustments or extensions.

As of December 31, 2021, the issued U.S.

patent s , pending U.S.

patent application s and pending foreign patent applications that we have licensed from Cold Spring Harbor Laboratory are anticipated to expire in 2035, absent any patent term adjustments or extensions.

Separately, we have filed patent applications with claims that are intended to cover compositions of matter of oligonucleotides designed to target specific elements in genes for more than 140 genetic diseases that we believe are amenable to upregulation of target protein expression using our TANGO platform.

As of December 31, 2020, any patents that may issue from these currently pending patent applications, including PCT international applications, U.S.

patents, pending U.S.

patent applications and pending foreign patent applications that we have licensed from Cold Spring Harbor Laboratory are anticipated to expire in 2035, absent any patent term adjustments or extensions.

Separately, we have filed patent applications with claims that are intended to cover compositions of matter of oligonucleotides designed to target specific elements in genes for many genetic diseases that we believe are amenable to upregulation of target protein expression using our TANGO platform.

As of December 31, 2021, any patents that may issue

from these currently pending patent applications, including PCT international applications, U.S.

patent applications, and foreign patent applications, are expected to expire between 2036 and 2042, absent any patent term adjustments or extensions.

With respect to STK-001, as of December 31, 2020, we have exclusively licensed a U.S.

patent and a pending U.S.

patent application that cover the mechanism of action of STK-001, as well as pending foreign patent applications.

The issued patent and any patents that may issue from these pending patent applications are expected to expire between 2035 and 2036, absent any patent term adjustments or extensions.

As of December 31, 2020, we also own a U.S.

patent, pending U.S.

patent applications, PCT international applications and pending foreign patent applications relating to STK-001, and the U.S.

With respect to STK-001, as of December 31, 2021, we have exclusively licensed U.S.

patents that cover the mechanism of action of STK-001, as well as foreign patents and pending foreign patent applications.

The issued patents and any patents that may issue from these pending patent applications are expected to expire between 2035 and 2036, absent any patent term adjustments or extensions.

As of December 31, 2021, we also own U.S.

patents, a pending U.S.

patent application, a PCT international application, foreign patents and pending foreign patent applications relating to STK-001, and the U.S.

patent any patents that may issue from these pending patent applications are expected to expire between 2038 and 2040, absent any patent term adjustments or extensions.

With respect to STK-002, as of December 31, 2021, we have exclusively licensed U.S.

patents that cover the mechanism of action of STK-002, as well as foreign patents and pending foreign patent applications.

The issued patents and any patents that may issue from these pending patent applications are expected to expire between 2035 and 2036, absent any patent term adjustments or extensions.

As of December 31, 2021, we also own a pending U.S.

patent application, a PCT international application, and pending foreign patent applications relating to STK-002, and any patents that may issue from these pending patent applications are expected to expire between 2038 and 2041, absent any patent term adjustments or extensions.

The term of individual patents depends upon the laws of the countries in which they are obtained.

19 unchanged sentences

Our issued patents and those that may issue in the future may be challenged, narrowed, circumvented or invalidated, which could limit our ability to stop competitors from marketing related platforms or product candidates or limit the length of the term of patent protection that we may have for our TANGO platform and product candidates.

In addition, the rights granted under any

issued patents may not provide us with protection or competitive advantages against competitors with similar technology.

In addition, the rights granted under any issued patents may not provide us with protection or competitive advantages against competitors with similar technology.

Furthermore, our competitors may independently develop similar technologies.

For these reasons, we may have competition for our TANGO platform and product candidates.

Moreover, because of the extensive time required for development, testing and regulatory review of a potential product, it is possible that before any product candidate can be commercialized, any related patent may expire or remain in force for only a short period following commercialization, thereby reducing any advantage of the patent.

Moreover, because of the extensive time required for development, testing and regulatory review of a potential product, it is possible that before any product candidate can be commercialized, any

related patent may expire or remain in force for only a short period following commercialization, thereby reducing any advantage of the patent.

For this and other risks related to our proprietary technology, inventions, improvements, platforms and product candidates, please see the section entitled “Risk factors—Risks related to our intellectual property.”

26 unchanged sentences

In April 2016, we entered into an exclusive, worldwide license agreement with the University of Southampton, (the “Southampton Agreement”), whereby we acquired rights to foundational technologies related to our TANGO technology.

Under the Southampton Agreement, we receive d an exclusive, worldwide license under certain licensed patents and applications relating to TANGO.

Under the Southampton Agreement, we received an exclusive, worldwide license under certain licensed patents and applications relating to TANGO.

As part of the Southampton Agreement, we paid 0.06 million pounds sterling (approximately $0.07 million as of the date thereof) as an up-front license fee.

Under the Southampton Agreement, we may be obligated to make additional payments that are contingent upon certain milestones being achieved, as well as royalties on future product sales.

Under the Southampton Agreement, we may

be obligated to make additional payments that are contingent upon certain milestones being achieved, as well as royalties on future product sales.

These royalty obligations survive until the latest of ( i ) the expiration of the last valid claim of a licensed patent covering a subject product or (ii) the expiration of any regulatory exclusivity for the subject product in a country.

2 unchanged sentences

As of December 3 1 , 202 1 , and December 31, 2020 , we had recorded no liabilities under the Southampton Agreement.

Additionally, certain licenses under the Southampton Agreement require the Company to reimburse the University of Southampton for certain past and ongoing patent related expenses.

For the three months ended December 3 1 , 2021 these expenses were $0.03 million compared to $0.0 5 million for three months ended December 31 , 2020 and for the year ended December 3 1 , 2021 these expenses were $0.

12 million compared to $0.0 9 million for the year ended December 3 1 , 2020.

Government regulation

1 unchanged sentence

In the United States, pharmaceutical products are subject to extensive regulation by FDA.

The Federal Food, Drug, and Cosmetic Act and other federal and state statutes and regulations govern, among other things, the research, development, testing, manufacture, storage, recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling and import and export of pharmaceutical products.

The Federal Food, Drug, and Cosmetic Act (the “FDCA”) and other federal and state statutes and regulations govern, among other things, the research, development, testing, manufacture, storage, recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling and import and export of pharmaceutical products.

Failure to comply with applicable U.S.

regulations may subject a company to a variety of administrative or judicial sanctions, such as FDA refusal to approve pending new drug applications, or NDAs, warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, civil penalties and criminal prosecution.

regulations may subject a company to a variety of administrative or judicial sanctions, such as a clinical hold, FDA refusal to approve pending new drug applications, or NDAs, warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, civil penalties and criminal prosecution.

Pharmaceutical product development for a new product or certain changes to an approved product in the U.S.

3 unchanged sentences

Preclinical requirements include laboratory evaluation of product chemistry, formulation, pharmacology and toxicity studies in animal trials to assess the characteristics and potential safety and efficacy of the product.

The conduct of the preclinical tests must comply with federal regulations and requirements, including good laboratory practices.

The conduct of the preclinical tests must comply with federal regulations and requirements, including GLP.

The results of preclinical testing are submitted to FDA as part of an IND along with other information, including information about product chemistry, manufacturing and controls, and a proposed clinical trial protocol.

5 unchanged sentences

(i) in compliance with federal regulations;

(ii) in compliance with good clinical practice, or GCP, an international standard designed to protect the rights and health of patients and to define the roles, qualifications and responsibilities of clinical trial sponsors, administrators and monitors;

as well as (iii) under protocols detailing the objectives of the trial, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated.

(ii) in compliance with good clinical practice (“GCP”), an international standard designed to protect the rights and health of patients and to define the roles, qualifications and responsibilities of clinical trial sponsors, administrators and monitors;

as well as (iii) under protocols detailing, among other things, the objectives of the trial, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated.

Each protocol involving testing on U.S.

patients and subsequent protocol amendments must be submitted to the FDA as part of the IND.

The FDA may order the temporary, or permanent, discontinuation of a clinical trial at any time, or impose other sanctions, if it believes that the clinical trial either is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical trial patients.

The study protocol and informed consent information for patients in clinical trials must also be submitted to an institutional review board, or IRB, for approval.

The FDA may order a clinical hold, which is the temporary, or permanent, discontinuation of a clinical trial at any time, or impose other sanctions, if it believes that the clinical trial either is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical trial patients.

If FDA imposes a clinical hold, clinical trials cannot commence or recommence without FDA authorization and then only under terms authorized by the FDA.

The study protocol and informed consent information for patients in clinical trials must also be submitted to an institutional review board (“IRB”), for approval.

An IRB may also require the clinical trial at the site to be halted, either temporarily or permanently, for failure to comply with the IRB’s requirements, or may impose other conditions.

10 unchanged sentences

The cost of preparing and submitting an NDA is substantial.

The submission of most NDAs is additionally subject to a substantial application user fee, currently exceeding $2,875,842 for fiscal year 2021, and the manufacturer and sponsor under an approved NDA are also subject to annual program fees, currently exceeding $336,000 for each prescription product.

The submission of most NDAs is additionally subject to a substantial application user fee, currently $3,117,218 for fiscal year 2022, and the applicant under an approved NDA is also subject to an annual program fee, currently $369,413 for each prescription drug product.

These fees are typically increased annually.

1 unchanged sentence

FDA has 60 days from its receipt of an NDA to determine whether the application will be accepted for filing based on the agency’s threshold determination that it is sufficiently complete to permit substantive review.

FDA may request additional information rather than file an NDA.

In this event, the NDA must be resubmitted with the additional information.

The resubmitted application also is subject to review before FDA files it.

Once the submission is accepted for filing, FDA begins an in-depth review.

8 unchanged sentences

Additionally, FDA will inspect the facility or the facilities at which the drug substance and drug product are manufactured.

FDA will not approve the product unless compliance with current good manufacturing practices, or cGMPs, is satisfactory and the NDA contains data that provide substantial evidence that the drug is safe and effective in the indication studied.

FDA will not approve the product unless compliance with current good manufacturing practices (“cGMPs”) is satisfactory and the NDA contains data that provide substantial evidence that the drug is safe and effective in the indication studied.

After FDA evaluates the NDA and the manufacturing facilities, it issues either an approval letter or a complete response letter.

A complete response letter generally outlines the deficiencies in the submission and may require substantial additional testing, or information, in order for FDA to reconsider the application.

Even after an applicant submits additional information, FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval.

If, or when, those deficiencies have been addressed to FDA’s satisfaction in a resubmission of the NDA, FDA will issue an approval letter.

1 unchanged sentence

An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications.

As a condition of NDA approval, FDA may require a risk evaluation and mitigation strategy, or REMS, to help ensure that the benefits of the drug outweigh the potential risks.

REMS can include medication guides, communication plans for healthcare professionals, and elements to assure safe use, or ETASU.

As a condition of NDA approval, FDA may require a risk evaluation and mitigation strategy (“REMS”) to help ensure that the benefits of the drug outweigh the potential risks.

REMS can include medication guides, communication plans for healthcare professionals, and elements to assure safe use (“ETASU”).

ETASU can include, but are not limited to, special training or certification for prescribing or dispensing, dispensing only under certain circumstances, special monitoring and the use of patient registries.

The requirement for a REMS can materially affect the potential market and profitability of the drug.

Moreover, product approval may require substantial post-approval testing and surveillance to monitor the drug’s safety or efficacy.

Once granted, product approvals may be withdrawn if compliance with regulatory standards is not maintained or problems are identified following initial marketing.

The requirement for a REMS can materially affect the potential market and profitability of the

FDA may also require a REMS for a drug that is already on the market if it determines, based on new safety information, that a REMS plan is necessary to ensure that the products benefits outweigh its risks.

Changes to some of the conditions established in an approved application, including changes in indications, labeling, or manufacturing processes or facilities, require submission and FDA approval of a new NDA or NDA supplement before the change can be implemented.

An NDA supplement for a new indication typically requires clinical data similar to that in the original application, and FDA uses the same procedures and actions in reviewing NDA supplements as it does in reviewing NDAs.

Fast Track Designation, Breakthrough Designation, Priority Review and Accelerated Approval Pathway

Fast Track Designation, Breakthrough Designation, Accelerated Approval, and Priority Review

The following four FDA programs are intended to facilitate and expedite development and review of new drugs to address unmet medical need in the treatment of a serious or life-threatening condition:

fast track designation, breakthrough therapy designation, accelerated approval, and priority review designation.

The programs are intended to help ensure that therapies for serious conditions are approved and available to patients as soon as it can be concluded that the therapies “benefits justify their risks”.

fast track designation, breakthrough therapy designation, accelerated approval, and priority review.

Under the Fast Track program, the sponsor of a new drug candidate may request that FDA designate the drug candidate for a specific indication as a Fast Track drug concurrent with, or after, the filing of the IND for the drug candidate.

9 unchanged sentences

For purposes of Breakthrough Therapy Designation, preliminary clinical evidence refers to evidence that is sufficient to indicate that the drug may demonstrate substantial improvement in effectiveness or safety over available therapies.

however, FDA recognizes that the data cannot be expected to be definitive at the time of designation.

Breakthrough therapy designation facilitates Intensive Guidance from the FDA on an “Efficient Drug Development Program, Beginning as Early as Phase 1”.

Under the FDA’s Accelerated Approval regulations, FDA may approve a drug for a serious or life-threatening illness that provides meaningful therapeutic benefit to patients over existing treatments based upon a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments.

A Breakthrough Therapy Designation conveys more intensive FDA guidance on an efficient drug development program.

FDA also has an organizational commitment to involve senior management in such guidance.

Such guidance may include holding meetings with the sponsor and review team throughout the development of the drug, providing timely advice to, and interactive communication with, the sponsor regarding the development of the drug to ensure that the development program to gather the non-clinical and clinical data necessary for approval is as efficient as possible, and taking steps to ensure that the design of the clinical trials is as efficient as practicable, when scientifically appropriate, such as by minimizing the number of patients exposed to a potentially less efficacious treatment.

The FDA’s accelerated approval pathway is available under FDA’s accelerated approval regulations and under the FDCA for drugs that have been granted Fast Track designation.

FDA may approve a drug for a serious or life-threatening illness that provides meaningful therapeutic benefit to patients over existing treatments based upon a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments.

In clinical trials, a surrogate endpoint is a measurement of laboratory or clinical signs of a disease or condition that substitutes for a direct measurement of how a patient feels, functions, or survives.

3 unchanged sentences

All promotional materials for drug candidates approved under accelerated regulations are subject to priority review by FDA.

A drug candidate is eligible for priority review, or review within a six-month time frame from the time an NDA is filed by FDA, if the drug candidate is intended for the treatment, diagnosis or prevention of a serious or life-threatening condition, demonstrates the potential to address an unmet medical need, or provides a significant improvement compared to marketed drugs.

Under the Orphan Drug Act, FDA may grant Orphan Drug Designation to drugs intended to treat a rare disease or condition—generally a disease or condition that affects fewer than 200,000 individuals in the U.S.

4 unchanged sentences

for that product, for that indication.

During the seven-year exclusivity period, FDA may not approve any other applications to market the same drug for the same disease, except in limited circumstances, such

as a showing of clinical superiority to the product with orphan drug exclusivity.

During the seven-year exclusivity period, FDA may not approve any other applications to market the same drug for the same disease, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity.

Orphan drug exclusivity does not prevent FDA from approving a different drug for the same disease or condition, or the same drug for a different disease or condition.

17 unchanged sentences

The sponsor submitting the priority review voucher must notify FDA of is intent to submit the voucher with the NDA or BLA at least 90 days prior to submission of the NDA or BLA and must pay a priority review user fee in addition to any other required user fee ($1,226,651 in fiscal year 2022).

FDA must take action on an NDA or BLA under priority review within six months of receipt of the NDA or BLA.

The Rare Pediatric Disease Priority Review Voucher program was reauthorized in the 21st Century Cures Act, allowing a product that is designated as a product for a rare pediatric disease prior to October 1, 2020 to be eligible to receive a rare pediatric disease priority review voucher upon approval of a qualifying application prior to October 1, 2022.

FDA must take action on an NDA or BLA under priority review within six months of filing the NDA or BLA by FDA.

On December 27, 2020, the Rare Pediatric Disease Priority Review Voucher Program was extended.

Under the current statutory sunset provisions, after September 30, 2024, FDA may only award a voucher for an approved rare pediatric disease product application if the sponsor has rare pediatric disease designation for the drug, and that designation was granted by September 30, 2024.

Without further statutory amendments, after September 30, 2026, the FDA may not award any rare pediatric disease priority review vouchers.

Post-approval requirements

22 unchanged sentences

Competitors may use this publicly available information to gain knowledge regarding the progress of development programs.

The government recently released a regulation and policy to expand and enhance the requirements related to registering and reporting the results of clinical trials, which may result in greater enforcement of these requirements in the future.

The Hatch-Waxman Act

18 unchanged sentences

The ANDA application also will not be approved until any applicable non-patent exclusivity listed in the Orange Book for the referenced product has expired.

Upon NDA approval of a new chemical entity, or NCE, which is a drug that contains no active moiety that has been approved by FDA in any other NDA, that drug receives five years of marketing exclusivity during which FDA cannot receive

any ANDA seeking approval of a generic version of that drug.

An ANDA may be submitted one year before NCE exclusivity expires if a Paragraph IV certification is filed.

1 unchanged sentence

Certain changes to a drug, such as the addition of a new indication to the package insert, can be the subject of a three-year period if the application contains reports of new clinical investigations (other than bioavailability studies) conducted or sponsored by the sponsor that were essential to the approval of the application.

FDA cannot approv e an ANDA for a generic drug that includes the change during the exclusivity period.

FDA cannot approve an ANDA for a generic drug that includes the change during the exclusivity period.

Patent term extension

9 unchanged sentences

Interim patent extensions are not available for a drug for which an NDA has not been submitted.

Foreign regulation

In addition to regulations in the United States, we will be subject to a variety of foreign regulations governing clinical trials and commercial sales and distribution of our product candidates to the extent we choose to sell any products outside of the United States.

Whether or not we obtain FDA approval for a product, we must obtain approval of a product by regulatory authorities of foreign countries before we can commence clinical trials or marketing of the product in those countries.

The approval process varies from country to country and the time may be longer or shorter than that required for FDA approval.

The requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary greatly from country to country.

As in the United States, post-approval regulatory requirements, such as those regarding product manufacture, marketing, or distribution would apply to any product that is approved outside the United States.

Other healthcare laws

4 unchanged sentences

This statute has been interpreted to apply to arrangements between pharmaceutical manufacturers on the one hand and prescribers, purchasers and formulary managers on the other.

Although there are a number of statutory exceptions and regulatory safe harbors protecting certain common activities from prosecution or other regulatory sanctions, the exceptions and safe harbors are drawn narrowly, and practices that involve remuneration intended to induce prescribing, purchases or recommendations may be subject to scrutiny if they do not qualify for an exception or safe harbor.

Although there are a number of statutory exceptions and regulatory safe harbors protecting certain

common activities from prosecution or other regulatory sanctions, the exceptions and safe harbors are drawn narrowly, and practices that involve remuneration intended to induce prescribing, purchases or recommendations may be subject to scrutiny if they do not qualify for an exception or safe harbor.

Federal civil and criminal false claims laws, including the federal civil False Claims Act, prohibit any person or entity from knowingly presenting, or causing to be presented, a false claim for payment to the federal government, or knowingly making, or causing to be made, a false statement to have a false claim paid.

This includes claims made to programs where the federal government reimburses, such as Medicaid, as well as programs where the federal government is a direct purchaser, such as when it purchases off the Federal Supply Schedule.

Recently, several pharmaceutical and other healthcare companies have been prosecuted under these laws for allegedly inflating drug prices they report to pricing services, which in turn were

used by the government to set Medicare and Medicaid reimbursement rates, and for allegedly providing free product to customers with the expectation that the customers would bill federal programs for the product.

Recently, several pharmaceutical and other healthcare companies have been prosecuted under these laws for allegedly inflating drug prices they report to pricing services, which in turn were used by the government to set Medicare and Medicaid reimbursement rates, and for allegedly providing free product to customers with the expectation that the customers would bill federal programs for the product.

In addition, certain marketing practices, including off-label promotion, may also violate false claims laws.

5 unchanged sentences

In addition, many state laws govern the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect.

Further, pursuant to the ACA, the Centers for Medicare & Medicaid Services, or CMS, has issued a final rule that requires manufacturers of prescription drugs to collect and report information on certain payments or transfers of value to physicians and teaching hospitals, as well as investment interests held by physicians and their immediate family members.

The first reports were due in 2014 and must be submitted on an annual basis.

Further, pursuant to the ACA, the Centers for Medicare & Medicaid Services (the “CMS”) has issued a final rule that requires manufacturers of prescription drugs to collect and report annually information on certain payments or transfers of value to physicians, physician assistants, certain types of advance practice nurses and teaching hospitals, or to entities or individuals at the request of, or designated on behalf of, such providers, and to report annually certain ownership and investment interests held by physicians and their immediate family members.

The reported data is made available in searchable form on a public website on an annual basis.

Failure to submit required information may result in civil monetary penalties.

Effective January 1, 2022, reporting on transfers of value to physician assistants, nurse practitioners or clinical nurse specialists, certified registered nurse anesthetists, and certified nurse-midwives will also be required.

In addition, several states now require prescription drug companies to report certain expenses relating to the marketing and promotion of drug products and to report gifts and payments to individual healthcare practitioners in these states.

6 unchanged sentences

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

If a drug company’s operations are found to be in violation of any such requirements, it may be subject to significant penalties, including civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, the curtailment or restructuring of its operations, loss of eligibility to obtain approvals from the FDA, exclusion from participation in government contracting, healthcare reimbursement or other federal or state government healthcare programs, including Medicare and Medicaid, integrity oversight and reporting obligations, imprisonment, and reputational harm.

imprisonment, the curtailment or restructuring of its operations, loss of eligibility to obtain approvals from the FDA, exclusion from participation in government contracting, healthcare reimbursement or other federal or state government healthcare programs, including Medicare and Medicaid, integrity oversight and reporting obligations, imprisonment, and reputational harm.

Although effective compliance programs can mitigate the risk of investigation and prosecution for violations of these laws, these risks cannot be entirely eliminated.

Any action for an alleged or suspected violation can cause a drug company to incur significant legal expenses and divert management’s attention from the operation of the business, even if such action is successfully defended.

healthcare reform

In the United States there have been, and continue to be, proposals by the federal government, state governments, regulators and third-party payors to control or manage the increased costs of health care and, more generally, to reform the U.S.

healthcare system.

The pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative initiatives For example, in March 2010, the ACA was enacted, which intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add new transparency requirements for the healthcare and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy reforms, substantially changed the way healthcare is financed by both governmental and private insurers, and significantly impacts the U.S.

pharmaceutical industry.

The ACA, among other things, (i) subjected therapeutic biologics to potential competition by lower-cost biosimilars by creating a licensure framework for follow-on biologic products, (ii) proscribed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs and therapeutic biologics that are inhaled, infused, instilled, implanted or injected, (iii) increased the minimum Medicaid rebates owed by manufacturers under the Medicaid Drug Rebate Program and extended the rebate program to individuals enrolled in Medicaid managed care organizations, (iv) established annual nondeductible fees and taxes on manufacturers of certain branded prescription drugs and therapeutic biologics, apportioned among these entities according to their market share in certain government healthcare programs (v) established a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer what are now 70% point of-sale discounts off negotiated prices of applicable brand drugs and therapeutic biologics to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs and therapeutic biologics to be covered under Medicare Part D, (vi) expanded eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to additional individuals and by adding new mandatory eligibility categories for individuals with income at or below 133% of the federal poverty level, thereby potentially increasing manufacturers’ Medicaid rebate liability, (vii) expanded the entities eligible for discounts under the Public Health program (viii) created a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research, and (ix) established a Center for Medicare Innovation at CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending.

There have been legislative and judicial efforts to modify, repeal, or otherwise invalidate all, or certain provisions of, the ACA, including measures taken during the Trump administration.

The Tax Cuts and Jobs Act of 2017, or the TCJA, among other things, included a provision repealing, effective January 1, 2019, the tax-based shared responsibility payment imposed by the ACA on certain individuals who fail to maintain qualifying health coverage for all or part of a year that is commonly referred to as the “individual mandate”.

In November 2020, the United States Supreme Court held oral arguments on the Fifth Circuit U.S.

Court of Appeals decision that held that the individual mandate is unconstitutional.

It is uncertain how the United States Supreme Court will rule on this case or how healthcare measures of the Biden administration will impact the ACA and our business.

Additionally, the 2020 federal spending package permanently eliminated, effective January 1, 2020, the ACA-mandated “Cadillac” tax on certain high cost employer-sponsored insurance plans and the medical device excise tax on non-exempt medical devices, and effective January 1, 2021, also eliminates the health insurer tax.

Further, the Bipartisan Budget Act of 2018, or the BBA, among other things, amended the ACA, effective January 1, 2019, to increase from 50% to 70% the point-of-sale discount that is owed by pharmaceutical manufacturers who participate in Medicare Part D and to close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole”.

In addition, CMS published a final rule that would give states greater flexibility, effective January 1, 2020, in setting benchmarks for insurers in the individual and small group marketplaces, which may have the effect of relaxing the essential health benefits required under the ACA for plans sold through such marketplaces

In addition, other legislative changes have been proposed and adopted in the United States since the ACA was enacted to reduce healthcare expenditures.

On August 2, 2011, the Budget Control Act of 2011 among other things, created measures for spending reductions by Congress.

A Joint Select Committee on Deficit Reduction, tasked with recommending a targeted deficit reduction of at least $1.2 trillion for the years 2013 through 2021, was unable to reach required goals, thereby triggering the legislation’s automatic reduction to several government programs.

This includes aggregate reductions of Medicare payments to providers of 2% per fiscal year, which went into effect on April 1, 2013 and will remain in effect through 2030 unless additional Congressional action is taken.

The Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, which was signed into law in March 2020 and is designed to provide financial support and resources to individuals and businesses affected by the COVID-19 pandemic, suspended the 2% Medicare sequester from May 1, 2020 through December 31, 2020, and extended the sequester by one year, through 2030.

The Consolidated Appropriations Act, 2021 extended the suspension of the 2% Medicare sequester through March 31, 2021.

Moreover, the American Taxpayer Relief Act of 2012, among other things, further reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover

overpayments to providers from three to five years.

If federal spending is further reduced, anticipated budgetary shortfalls may also impact the ability of relevant agencies, such as the FDA or the National Institutes of Health to continue to function at current levels.

Amounts allocated to federal grants and contracts may be reduced or eliminated.

These reductions may also impact the ability of relevant agencies to timely review and approve research and development, manufacturing, and marketing activities, which may delay our ability to develop, market and sell any products we may develop.

Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives.

For example, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, or MMA, changed the way Medicare covers and pays for pharmaceutical products.

The legislation expanded Medicare coverage for drug purchases by the elderly and introduced a new reimbursement methodology based on average sales prices for physician-administered drugs.

In addition, this legislation provided authority for limiting the number of drugs that will be covered in any therapeutic class.

While the MMA only applies to drug benefits for Medicare beneficiaries, private payors often follow Medicare coverage policy and payment limitations in setting their own reimbursement rates.

Therefore, any reduction in reimbursement that results from the MMA may result in a similar reduction in payments from private payors.

Recently there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, reduce the costs of drugs under Medicare, and reform government program reimbursement methodologies for drug products.

At the federal level, the Trump administration’s budget proposal for fiscal year 2021 included at $135 billion allowance to support legislative proposals seeking to reduce drug process, increase competition, lower out-of-pocket drug costs for patients, and increase patient access to lower cost generic and biosimilar drugs.

In particular, on July 24, 2020 and September 13, 2020, the Trump administration announced several executive orders related to prescription drug pricing that seek to implement several of the administration’s proposals.

FDA also released a final rule in September 2020 providing guidance for states to build and submit importation plans for drugs from Canada.

Further, in November 2020, HHS finalized a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law.

The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers.

The CMS also issued an interim final rule implementing President Trump’s Most Favored Nation executive order, which would tie Medicare Part B payments for certain physician-administered drugs to the lowest price paid in other economically advanced countries, effective January 1, 2021.

On December 28, 2020, the United States District Court in Northern California issued a nationwide preliminary injunction against implementation of the interim final rule.

In December 2020, CMS issued a final rule implementing significant manufacturer price reporting changes under the Medicaid Drug Rebate Program, including regulations that affect manufacturer-sponsored patient assistance programs subject to pharmacy benefit manager accumulator programs and Best Price reporting related to certain value-based purchasing arrangements.

It is unclear to what extent these new regulations will be implemented and to what extent these regulations or any future legislation or regulations by the Biden administration will have on our business, including our ability to generate revenue and achieve profitability.

At the state level, legislatures are increasingly 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.

Additionally, on May 30, 2018, the Trickett Wendler, Frank Mongiello, Jordan McLinn, and Matthew Bellina Right to Try Act of 2017 was signed into law.

The law, among other things, provides a federal framework for certain patients to access certain investigational new drug products that have completed a Phase I clinical trial and that are undergoing investigation for FDA approval.

Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA authorization under an FDA expanded access program;

however, manufacturers are not obligated to provide investigational new drug products under the current federal right to try law.

Possible Change in Law or Policy

Healthcare reforms that have been adopted, and that may be adopted in the future, could result in further reductions in coverage and levels of reimbursement for pharmaceutical products, increases in rebates payable under U.S.

government rebate programs and additional downward pressure on pharmaceutical product prices.

On September 9, 2021, the Biden administration published a wide-ranging list of policy proposals, most of which would need to be carried out by Congress, to reduce drug prices and drug payment.

The HHS plan includes, among other reform measures, proposals to lower prescription drug prices, including by allowing Medicare to negotiate prices and disincentivizing price increases, and to support market changes that strengthen supply chains, promote biosimilars and generic drugs, and increase price transparency.

Many similar proposals, including the plans to give Medicare Part D authority to negotiate drug prices, require drug manufacturers to pay rebates on drugs whose prices increase greater than the rate of inflation, and cap out-of-pocket costs, have already been included in policy statements and legislation currently being considered by Congress.

It is unclear to what extent these and other statutory, regulatory, and administrative initiatives will be enacted and implemented.

Foreign regulation

Clinical Trials

For clinical trials, many countries outside of the United States have a similar process that requires the submission of a clinical study application similar to the process in the United States.

However, the specific requirements governing the conduct of clinical trials vary greatly from country to country.

In the European Union, for example, clinical trials are governed by the new EU Regulation on Clinical Trials (Reg.

536/2014) (the “CTR”) that has become applicable on January 31, 2022.

The CTR stipulates the process of obtaining competent authority approval for clinical trials.

Under the CTR, trial sponsors submit their application for approval via an EU Portal.

While the procedure for approval is conducted in a coordinated manner among the concerned EU Member States as provided under the CTR, the approvals will still have to be granted by the competent authorities of the EU Member States where a trial takes place.

The CTR has streamlined the process for the application and granting of the approvals in comparison with the predecessor legislation, Directive 2001/20/EC on clinical trials (the “CTD”).

However, the process of obtaining clinical trial approval in the EU is still complex and can significantly delay the start of a multinational clinical trial.

Following the United Kingdom’s exit from the European Union on December 31, 2020, different rules apply in the United Kingdom from the European Union.

Approval and Reimbursement

Whether or not we obtain FDA approval for a product, we must obtain approval or licensing of a product by regulatory authorities of foreign countries before we can commence marketing of the product in those countries.

The approval processes for both approval and marketing of commercial drugs vary from country to country and the time may be longer or shorter than that required for FDA approval.

The requirements governing the product licensing, pricing and reimbursement vary greatly from country to country.

To obtain regulatory approval of a medicinal product under EU regulatory systems, a sponsor must submit a marketing authorization application.

The grant of marketing authorization in the EU is governed by Directive 2001/83/EC of the European Parliament and of the Council, commonly known as the Community Code and Regulation (EC) No 726/2004 of the European Parliament and of the Council of 31 March 2004 laying down Community procedures for the authorization and supervision of medicinal products for human and veterinary use and establishing the European Medicines Agency (the “EMA”), commonly referred to as the EMA Regulation.

In addition, Regulation 1394/2007/EC on advanced therapy

medicinal products (“ATMP”) lays down specific rules concerning the authorization, supervision and pharmacovigilance of gene therapy medicinal products, somatic cell therapy medicinal products and tissue engineered products.

The EMA’s Committee for Advanced Therapies (“CAT”) is responsible for assessing the quality, safety and efficacy of ATMP.

The role of CAT is to prepare a draft opinion on an application for marketing authorization for an ATMP candidate.

EMA then provides a final opinion regarding the application for marketing authorization.

The European Commission grants or refuses marketing authorization after the EMA has delivered its opinion.

Innovative medicinal products are authorized in the EU on the basis of a full marketing authorization application (as opposed to an application for marketing authorization that relies, in whole or in part, on data in the marketing authorization dossier for another, previously approved medicinal product).

Applications for marketing authorization for innovative medicinal products must contain the results of pharmaceutical tests, preclinical tests and clinical trials conducted with the medicinal product for which marketing authorization is sought.

EU legislation provides for a system of regulatory data and market exclusivity.

According to Article 14(11) of the EMA Regulation, and Article 10(1) of the Community Code, upon receiving marketing authorization, new chemical entities approved on the basis of complete independent data package benefit from eight years of data exclusivity and an additional two years of market exclusivity.

Data exclusivity prevents regulatory authorities in the European Union from referencing the innovator’s data to assess a generic (abbreviated) application.

During the additional two-year period of market exclusivity, a generic marketing authorization can be submitted, and the innovator’s data may be referenced, but no generic medicinal product can be marketed until the expiration of the market exclusivity.

The overall ten-year period will be extended to a maximum of eleven years if, during the first eight years of those ten years, the marketing authorization holder, or MAH, obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies.

Even if a compound is considered to be a new chemical entity and the innovator is able to gain the period of data exclusivity, another company nevertheless could also market another version of the drug if such company obtained marketing authorization based on an application with a complete independent data package of pharmaceutical tests, preclinical tests and clinical trials.

Depending upon the timing and duration of the EU marketing authorization process, products may be eligible for up to five years’ supplementary protection certificates, or SPC, pursuant to Regulation (EC) No 469/2009.

Such SPC extend the rights under the basic patent for the drug.

Products authorized as “orphan medicinal products” in the EU are entitled to benefits additional to those granted in relation to innovative medicinal products.

In accordance with Article 3 of Regulation (EC) No.

141/2000 of the European Parliament and of the Council of 16 December 1999 on orphan medicinal products, a medicinal product may be designated as an orphan medicinal product if (1) it is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition;

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

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

Further guidance on such criteria is provided in European Commission Regulation (EC) No.

847/2000 of 27 April 2000 laying down the provisions for implementation of the criteria for designation of a medicinal product as an orphan medicinal product and definitions of the concepts “similar medicinal product” and “clinical superiority”.

Orphan medicinal products are eligible for financial incentives such as reduction of fees or fee waivers and following grant of a marketing authorization, EMA and the EU Member States’ competent authorities are not permitted to accept another application for a marketing authorization, or grant a marketing authorization or accept an application to extend an existing marketing authorization, for the same therapeutic indication of a similar medicinal product for ten years following grant or authorization.

The application for orphan drug designation must be submitted before the application for marketing authorization.

The applicant may receive a fee reduction for the marketing authorization application if the orphan drug designation has been granted, but not if the designation is still pending at the time the marketing authorization is submitted.

Orphan drug designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.

The 10-year market exclusivity that an orphan drug enjoys may be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for orphan designation, for example, if the product is sufficiently profitable not to justify maintenance of market exclusivity.

Additionally, marketing authorization may be granted to a similar product during the 10-year period of market exclusivity for the same therapeutic indication at any time if:

The second applicant can establish in its application that its product, although similar to the orphan medicinal product already authorized, is safer, more effective or otherwise clinically superior;

The holder of the marketing authorization for the original orphan medicinal product consents to a second orphan medicinal product application;

The holder of the marketing authorization for the original orphan medicinal product cannot supply enough orphan medicinal product.

Similar to obligations imposed in the United States, medicinal products authorized in the EU may be subject to post-authorization obligations, including the obligation to conduct Post Marketing Safety Studies (“PASS”) or Post Marketing Efficacy Studies (“PAES”).

Reimbursement for medicinal products is still an area that is not harmonized in the EU, but largely governed by EU Member States’ laws.

At EU level, Council Directive 89/105/EEC (the “Price Transparency Directive”) aims to ensure that pricing and reimbursement mechanisms established in EU Member States are transparent and objective, do not hinder the free movement and trade of medicinal products in the EU and do not hinder, prevent or distort competition on the market.

The Price Transparency Directive does not, however, provide any guidance concerning the specific criteria based on which pricing and reimbursement decisions are to be made in individual EU Member States.

Neither does it have any direct consequence for pricing or levels of reimbursement in individual EU Member States.

The national authorities of the individual EU Member States are free to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices and/or reimbursement of medicinal products for human use.

Individual EU Member States adopt policies according to which a specific price or level of reimbursement is approved for the medicinal product.

Other EU Member States adopt a system of reference pricing, basing the price or reimbursement level in their territory either, on the pricing and reimbursement levels in other countries, or on the pricing and reimbursement levels of medicinal products intended for the same therapeutic indication.

Furthermore, some EU Member States impose direct or indirect controls on the profitability of the company placing the medicinal product on the market.

Health Technology Assessment (“HTA”) of medicinal products is becoming an increasingly common part of the pricing and reimbursement procedures in EU Member States.

HTA is the procedure according to which the assessment of the public health impact, therapeutic impact and the economic and societal impact of the use of a given medicinal product in the national healthcare systems of the individual country is conducted.

HTA generally focuses on the clinical efficacy and effectiveness, safety, cost, and cost-effectiveness of individual medicinal products as well as their potential implications for the national healthcare system.

Those elements of medicinal products are compared with other treatment options available on the market.

The outcome of HTA may influence the pricing and reimbursement status for specific medicinal products within individual EU member states.

The extent to which pricing and imbursement decisions are influenced by the HTA of a specific medicinal product vary between the EU Member States.

A new EU Regulation on HTA was adopted on December 13, 2021, Regulation (EU) 2021/2282 of the European Parliament and of the Council of 15 December 2021 on health technology assessment and amending Directive 2011/24/EU (“HTA Regulation”).

It will become applicable on January12, 2025.

The HTA Regulation covers new medicines and certain new medical devices, “providing the basis for permanent and sustainable cooperation at the EU level for joint clinical assessments in these areas.” Member states will be able to use common HTA tools, methodologies and procedures across the EU, working together in four main areas:

1) joint clinical assessments focusing on the most innovative health technologies with the most potential impact for patients;

2) joint scientific consultations whereby developers can seek advice from HTA authorities;

3) identification of emerging health technologies to identify promising technologies early;

and 4) continuing voluntary cooperation in other areas.

Individual member states will continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technology, and making decisions on pricing and reimbursement.

In the United Kingdom and following the United Kingdom’s exit from the European Union, EU medicines regulation has been adopted as standalone United Kingdom legislation with some amendments to reflect procedural and other requirements with respect to marketing authorizations and other regulatory provisions.

In order to market a medicinal product in the United Kingdom, a license or marketing authorization must be obtained from the United Kingdom Medicines and Healthcare Products Regulatory Agency (the “MHRA”).

The United Kingdom legislation includes multiple assessment routes for applications for medicinal products, including a 150-day national assessment or a rolling review application.

Further, and for a transitional period until December 31, 2022, the MHRA may rely on a decision taken by the European Commission on the approval of a new marketing authorization in the centralized procedure.

In addition, the MHRA has the power to have regard to marketing authorizations approved in EU member states.

The MHRA reviews applications for orphan designation at the time of a marketing authorization application or as part of a subsequent variation to that authorization.

To qualify for orphan designation, a medicine must meet certain criteria in the United Kingdom including that the medicine for the treatment, prevention or diagnosis of a disease that is life-threatening or

chronically debilitating, the prevalence of the condition must not be more than 5 in 10,000 or it must be unlikely that the marketing would generate sufficient returns to justify investment and no satisfactory method of diagnosis, prevention or treatment must exist in Great Britain or, if such a method exists the medicine must be of significant benefit to those affected by the condition.

On grant of a marketing authorization with orphan status, the medicinal product will benefit from up to 10 years of market exclusivity from similar products in the approved orphan indication starting from the date of first approval of the product in Great Britain.

The United Kingdom has adopted new legislation, the Medicines and Medical Devices Act 2021 and may make changes to the licensing or authorization of medicines in the future.

The separate UK authorization system, albeit with transitional recognition procedures in the UK, may lead to additional regulatory costs.

In addition, further regulatory costs will be incurred with respect to the lack of mutual recognition of batch testing and related regulatory measures between the European Union and the United Kingdom.

Reimbursement in the United Kingdom for use by public payors (National Health Service) organizations may depend on a positive technology assessment by the National Institute for Health and Care Excellence (“NICE”).

A positive recommendation by NICE would lead to an obligation to fund, subject to terms of that approval, by NHS organizations.

In assessing any new medicinal product, NICE will take into account clinical as well as the economic value of the product.

Failure to obtain positive reimbursement recommendations or failure to obtain government and third-party payor reimbursement coverage in foreign countries may affect the marketability and commercial sales of any product candidates for which regulatory approval is received.

Employees and Human Capital Resources

1 unchanged sentence

We have not experienced any work stoppages.

We consider our relationship with our employees to be good.

None of our employees is represented by a labor union or covered by collective bargaining agreements, and we consider our relationship with our employees to be good.

We seek to attract, hire and retain individuals of diverse backgrounds and of all ages, genders, ethnicities, religions, home countries and sexual orientation.

As of December 31, 2021, approximately 57% of our employees are female, and approximately 38% of our management team (which we define as at the vice president level and above) are female.

More than one-third of our employees self-identify as racially or ethnically diverse as of December 31, 2021.

Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and additional employees.

12 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.

What changed 10-K

Item 1. Business