What changed in this filing

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Item 1A. Risk Factors

2026-03-13 compared with 2025-03-27 · 91 added, 77 removed, 551 unchanged (23% of the section changed)

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If we are unable to successfully complete clinical development of, obtain regulatory approval for, and successfully commercialize MOLBREEVI, our business may be harmed.

The success of our business is dependent on our ability to advance the clinical development of our sole product candidate, MOLBREEVI, an investigational inhaled GM-CSF for the treatment of aPAP.

The success of our business is dependent on our ability to advance the clinical development of our sole product candidate, MOLBREEVI, an investigational inhaled GM-CSF for the treatment of autoimmune PAP.

To date, we have never obtained regulatory approvals for or commercialized a product candidate, and we may never be able to develop a marketable product.

We are devoting, and expect to continue to devote, substantially all our efforts and financial resources to the development of MOLBREEVI for aPAP, including clinical trials, regulatory approval, and, if approved, commercialization.

Our business depends heavily on the successful completion of clinical development and subsequent regulatory approval of MOLBREEVI for aPAP.

We are conducting IMPALA-2, a global Phase 3 pivotal trial designed to compare the efficacy and safety of MOLBREEVI 300 µg administered once daily by inhalation with matching placebo in patients with aPAP.

We are devoting, and expect to continue to devote, substantially all our efforts and financial resources to the development of MOLBREEVI for autoimmune PAP, including clinical trials, regulatory approval, and, if approved, commercialization.

Our business depends heavily on the successful completion of clinical development and subsequent regulatory approval of MOLBREEVI for autoimmune PAP.

Although we may believe the trial demonstrates promising results, regulatory authorities may analyze or weigh trial data differently, resulting in delay or failure to obtain marketing approval or a requirement to conduct confirmatory studies.

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Many of these clinical, regulatory, and commercial matters are beyond our control and are subject to other risks described elsewhere in this Item 1A, Risk Factors section.

Accordingly, we cannot assure that we will be able to advance our product candidate further through final clinical development, or obtain regulatory approval of, commercialize, or generate significant revenue.

Accordingly, we cannot assure that we will be able to advance our product candidate further through final clinical development, or obtain regulatory approval, commercialize, or generate significant revenue.

If we cannot do so, or are significantly delayed in doing so, our business will be materially harmed.

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• delays in identifying and reaching agreement on acceptable terms with prospective CROs, clinical trial sites, and investigators, which agreements can be subject to extensive negotiation and may vary significantly among trial sites;

• delays in obtaining regulatory approval in a prospective country;

• delays in obtaining ethics committee approval to conduct or extend a clinical trial at a prospective site;

• delays in reaching agreements on acceptable terms with prospective CMOs or other vendors for the production and supply of clinical trial material and, if necessary, drug administration devices, which agreements can be subject to extensive negotiation;

• delays in reaching agreements on acceptable terms with prospective CMOs or other vendors for the production and supply of clinical trial material and, if necessary, drug delivery devices, which agreements can be subject to extensive negotiation;

• delays in the production or delivery of sufficient quantities of clinical trial material or drug delivery devices from our CMOs and other vendors to initiate or continue a clinical trial;

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• delays due to product candidate recalls as the result of stability failure, excessive product complaints, or other failures of the product candidate during its use or testing;

• invalidation of clinical data caused by premature unblinding or integrity issues;

• invalidation of clinical data caused by mixing up of the active drug and placebo through randomization or manufacturing errors;

• delays on the part of our CROs, CMOs, and other third-party contractors in developing procedures and protocols or otherwise conducting activities in accordance with applicable policies and procedures and in accordance with agreed upon timelines;

• invalidation of clinical data caused by premature unblinding or integrity issues or by mixing up of the active drug and placebo through randomization or manufacturing errors;

• delays by CROs, CMOs, and other third-party contractors in conducting activities in accordance with applicable policies and procedures and in accordance with agreed upon timelines;

• delays in identifying and hiring or engaging, as applicable, additional employees or consultants to assist in managing clinical trial-related activities;

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A number of companies in the pharmaceutical industry have suffered significant setbacks in advanced clinical trials due to lack of efficacy or adverse safety profiles, notwithstanding promising results in earlier clinical trials, and we cannot be certain that we will not face similar setbacks.

For example, the top line results from our IMPALA trial were released by us on June 12, 2019 and did not meet all of the statistical goals and protocol end

On October 1, 2019, we received a written response from the FDA in connection with a Type C meeting regarding the MOLBREEVI development program for aPAP and results from IMPALA in which the FDA indicated that the data provided did not provide sufficient evidence of efficacy and safety for the treatment of aPAP.

For example, the top line results from our IMPALA trial were released by us on June 12, 2019 and did not meet all of the statistical goals and protocol end points.

On October 1, 2019, we received a written response from the FDA in connection with a Type C meeting regarding the MOLBREEVI development program for autoimmune PAP and results from IMPALA in which the FDA indicated that the data provided did not provide sufficient evidence of efficacy and safety for the treatment of autoimmune PAP.

Negative or inconclusive results could cause the FDA and other regulatory authorities to require us to repeat or conduct additional clinical trials, which could significantly increase the time and expense associated with development of that product candidate or cause us to elect to discontinue one or more clinical programs.

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For example, the FDA or foreign regulatory agencies will review the sponsor’s internal systems and processes, as well as those of its CROs, CMOs, and other vendors, related to development of its product candidates, including those pertaining to its clinical studies and manufacturing processes.

Before accepting a regulatory approval submission for review or before approving such submission, the FDA or foreign regulatory agencies may request that we provide additional information that may require significant resources and time to generate, and there is no guarantee that our product candidate will be approved for any indication for which we may apply.

For example, in May 2025 we received the RTF requesting the Company provide additional data related to Chemistry, Manufacturing, and Controls.

The FDA or foreign regulatory agencies may choose not to approve a BLA or its equivalent for a variety of reasons, including a decision related to the safety or efficacy data, manufacturing controls or systems, or for any other issues that the agency may identify related to the development of its product candidates.

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These may occur as a result of drug scandals, recalls, or a political environment unrelated to our products.

For example, the FDA has granted MOLBREEVI for aPAP Fast Track and BTD, which are each designed to expedite the development and review of certain drugs.

For example, the FDA has granted MOLBREEVI for autoimmune PAP Fast Track and BTD, which are each designed to expedite the development and review of certain drugs.

If there were a change in FDA policies and we were to lose those designations, it could cause delays in the regulatory review process.

Additionally, changes in FDA priorities due to a new administration, layoffs, or U.S.

federal government shut-downs or budget sequestrations, such as ones that occurred during January 2018 and December 2018 through January 2019, may result in significant reductions to the FDA’s budget, employees, and operations, which may lead to slower response times and longer review periods, potentially affecting our ability to progress development of our product candidate or obtain regulatory approval for our product candidate.

federal government shut-downs or budget sequestrations, such as the shut-down that occurred from October 1, 2025 until November 12, 2025, may result in significant reductions to the FDA’s budget, employees, and operations, which may lead to slower response times and longer review periods, potentially affecting our ability to progress development of our product candidate or obtain regulatory approval for our product candidate.

Even if the FDA or foreign regulatory agencies grant approvals for a product candidate, the conditions or scope of the approval(s) may limit successful commercialization of the product candidate and impair our ability to generate substantial sales revenue.

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The FDA or foreign regulatory agencies may also only grant marketing approval contingent on the performance of costly post-approval nonclinical or clinical studies, or subject to warnings or contraindications that limit commercialization.

Additionally, even after granting approval, the manufacturing processes, labeling, packaging,

distribution, adverse event reporting, storage, advertising, promotion, and recordkeeping for our products will be subject to extensive and ongoing regulatory requirements.

These requirements include submissions of safety and other post-marketing information and reports, registration, and continued compliance with cGMP, GCP, international conference on harmonization regulations, and good laboratories practice ("GLP"), which are regulations and guidelines that are enforced by the FDA or foreign regulatory agencies for all clinical development and for any clinical studies that we conduct post-approval.

Additionally, even after granting approval, the manufacturing processes, labeling, packaging, distribution, adverse event reporting, storage, advertising, promotion, and recordkeeping for our products will be subject to extensive and ongoing regulatory requirements.

These requirements include submissions of safety and other post-marketing information and reports, registration, and continued compliance with cGMP, GCP, international conference on

harmonization regulations, and good laboratories practice ("GLP"), which are regulations and guidelines that are enforced by the FDA or foreign regulatory agencies for all clinical development and for any clinical studies that we conduct post-approval.

The FDA or foreign regulatory agencies may decide to withdraw approval, add warnings, or narrow the approved indications in the product label, or establish risk management programs that could restrict distribution of our products.

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Any of these events could prevent us from achieving or maintaining market acceptance of the affected product or could substantially increase the costs and expenses of commercializing the product, which in turn could delay or prevent us from generating significant revenue from its sale.

Even if we receive regulatory approval for our product candidate, we may face regulatory difficulties that could materially and adversely affect our business, financial condition, and results of operations.

Even if we receive regulatory approval for MOLBREEVI, we may face regulatory requirements that could materially and adversely affect our business, financial condition, and results of operations.

Even if initial regulatory approval is obtained, as a condition to the initial approval, the FDA or a foreign regulatory agency may impose significant restrictions on a product’s indicated uses or marketing or impose ongoing requirements for potentially costly post-approval studies or marketing surveillance programs, any of which would limit the commercial potential of the product.

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• seize or detain products that are deemed to be adulterated.

If our product candidate receives regulatory approval but fails to achieve significant market acceptance among the medical community, patients, or third-party payers, the revenue we generate from its sales will be limited and our business may never achieve profitability.

If MOLBREEVI receives regulatory approval but fails to achieve significant market acceptance among the medical community, patients, or third-party payers, the revenue we generate from its sales will be limited and our business may never achieve profitability.

Our success will depend in substantial part on the extent to which our product candidate, if approved, is accepted by the medical community and patients and reimbursed by third-party payers, including government payers.

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• the indications for which our product is approved;

• claims or other information (including limitations or warnings) in a product’s approved labeling;

• claims or other information (including limitations or warnings) in the product’s approved labeling;

• reimbursement and coverage policies of government and other third-party payers;

• pricing and cost-effectiveness of our product relative to alternative treatments;

• availability of alternative treatments;

• pricing and cost-effectiveness of our product relative to alternative treatments;

• smaller-than-expected market size due to lack of disease awareness of a rare disease, or the patient population with a specific rare disease being smaller than anticipated;

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In addition, our efforts to educate the medical community and third-party payers regarding benefits of our product may require significant resources and may never be successful.

If we determine that a product candidate may not achieve adequate market acceptance or that the potential market size does not justify additional expenditures on the program, we may reduce our expenditures on the development and/or the process of seeking regulatory approval of the product candidate while we evaluate whether and on what timeline to move the program forward.

If we determine that our product candidate may not achieve adequate market acceptance or that the potential market size does not justify additional expenditures on the program, we may reduce our expenditures on the development and/or the process of seeking regulatory approval of the product candidate while we evaluate whether and on what timeline to move the program forward.

Even if we receive regulatory approval to market our product candidate in the U.S., we may never receive approval or commercialize our product outside of the U.S., which would limit our ability to realize the full commercial potential of our product candidate.

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Approval procedures vary among countries and can involve additional product testing and validation and additional administrative review periods.

The time required to obtain approval in other countries generally differs from that required to obtain FDA approval.

The time required to obtain approval

in other countries generally differs from that required to obtain FDA approval.

The regulatory approval process in other countries may include all of the risks detailed above regarding FDA approval in the U.S., as well as other risks.

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No revenue from operations will likely be available until, and unless, our current product candidate, MOLBREEVI, is approved by the FDA or another regulatory agency and successfully marketed, or we enter into an arrangement that provides for licensing revenue or other partnering-related funding, outcomes which we may not achieve.

We may require additional financing to obtain regulatory approval for MOLBREEVI and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce, or terminate our product development efforts or other operations.

We may require additional financing to support our operations and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce, or terminate our product development efforts or other operations.

Since our Aravas subsidiary was formed in 2007, most of our resources have been dedicated to the development and acquisition of our product candidates, primarily MOLBREEVI.

Our priority remains the continued development of MOLBREEVI for the treatment of aPAP.

Our priority remains the continued development of MOLBREEVI for the treatment of autoimmune PAP.

We cannot estimate with reasonable certainty the actual amounts necessary to successfully complete the development and commercialization of our product candidate, and there is no certainty that we will be able to raise the necessary capital on reasonable terms or at all.

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If we raise additional capital through debt financing, it may be subject to covenants limiting or restricting our ability to take specific actions, such as incurring additional debt or making capital expenditures, or subject to specified financial ratios, any of which could restrict our ability to develop and commercialize our product candidate or operate as a business.

Our loan agreement contains covenants which may adversely impact our business;

the failure to comply with such covenants could cause our outstanding debt to become immediately payable or accelerate principal payments.

We are a party to an Amended and Restated Loan and Security Agreement with Silicon Valley Bank, now a division of First Citizens Bank (the “Amended Loan Agreement”), pursuant to which we have pledged substantially all of our assets, other than our intellectual property (which is subject to a negative pledge).

The Amended Loan Agreement includes a number of restrictive covenants, including restrictions on incurring additional debt, making investments, granting liens, disposing of assets, paying dividends, and redeeming or repurchasing capital stock, subject to certain exceptions.

Collectively, these restrictive covenants could constrain our ability to grow our business through acquisitions or engage in other transactions.

The Amended Loan Agreement includes customary events of default, such as our failure to pay amounts due, our failure to comply with covenants, or the occurrence of an event that would reasonably be expected to have a material adverse event on our business.

Upon the occurrence and during the continuation of an event of default, Silicon Valley Bank could declare all outstanding loans under the Amended Loan Agreement immediately due and payable and exercise remedies against us and the collateral.

Such an event would have a material adverse effect on our

liquidity, financial condition, operating results, business, and prospects and cause the price of our common stock to decline.

The Hercules Loan Agreement contains covenants which may adversely impact our business and the failure to comply with such covenants could cause our outstanding debt to become immediately payable or accelerate principal payments.

We are a party to a Loan and Security Agreement, dated March 26, 2025, with the lenders party thereto (the “Lenders”) and Hercules Capital, Inc., as administrative agent and collateral agent, which was amended by the First Amendment dated January 26, 2026 (the “First Amendment”) (the loan agreement as amended, the “Hercules Loan Agreement”), pursuant to which we have borrowed $30 million of term loans and may borrow up to an additional $75 million of term loans if we are able to satisfy the conditions precedent described under Note 7.

Debt Facility of the consolidated financial statements in this annual report on Form 10-K.

As security for our borrowings under the Hercules Loan Agreement, we pledged substantially all of our assets.

The Hercules Loan Agreement includes a number of restrictive covenants, including restrictions on incurring additional debt, making investments, granting liens, disposing of assets, paying dividends, and redeeming or repurchasing capital stock, and a number of affirmative covenants, including the Cash Requirement and the Conditional Minimum Revenue Covenant (as such terms are defined in Note 7.

Debt Facility and Note 16.

Subsequent Events of the consolidated financial statements in this annual report on Form 10-K).

Collectively, these covenants could constrain our ability to grow our business through acquisitions or engage in other transactions.

The Hercules Loan Agreement includes customary events of default, such as our failure to pay amounts due, our failure to comply with covenants, or the occurrence of an event that would reasonably be expected to have a material adverse event on our business.

Upon the occurrence and during the continuation of an event of default, the Lenders could declare all outstanding loans under the Hercules Loan Agreement immediately due and payable and exercise remedies against us and the collateral.

Such an event would have a material adverse effect on our liquidity, financial condition, operating results, business, and prospects and cause the price of our common stock to decline.

Refer to Note 7.

Debt Facility of the consolidated financial statements in this annual report on Form 10-K for additional discussion.

Debt Facility and Note 16.

Subsequent Events of the consolidated financial statements in this annual report on Form 10-K for additional discussion.

Any future acquisitions that we make could disrupt our business and harm our financial condition.

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While we have secured long-term commercial supply agreements with many of the third party CMOs, we would need to negotiate agreements for commercial supply with several important CMOs, and we may not be able to reach agreement on acceptable terms.

In addition, we rely on these third parties to conduct or assist us in key manufacturing development activities, including qualification of equipment, developing and validating methods, defining critical process parameters, releasing component materials, demonstrating comparability of DS and DP, and conducting stability testing, among other things.

In addition, we rely on these third parties to conduct or assist us in key manufacturing development activities, including qualification of equipment, developing and validating methods, defining critical process parameters, releasing component materials, demonstrating comparability of drug substance and drug product, and conducting stability testing, among other things.

If these third parties are unable to perform their tasks successfully in a timely manner, whether for technical, financial, or other reasons, we may be unable to secure clinical trial material, or commercial supply material if approved, which likely would delay the initiation, conduct, or completion of our clinical trials or prevent us from having enough commercial supply material for sale, which would have a material and adverse effect on our business.

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The extent to which circumstances such as global health threats, global conflicts, and social unrest impact our ability to procure sufficient supplies for the development and commercialization of our product candidate going forward will depend on the severity and duration of such circumstances.

For example, our primary CMO for drug substance operates in Argentina, which is experiencing high inflation, a weakening currency, labor strikes and social and political unrest.

For example, one of our CMOs for drug substance operates in Argentina, which is experiencing high inflation, a weakening currency, labor strikes and social and political unrest.

Those conditions could result in supply chain disruptions or increased costs.

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In addition, the FDA or other regulatory authorities may impose additional requirements as we scale up initial production capabilities, which may delay our scale-up activities and/or add expense.

If our manufacturers encounter any of the aforementioned difficulties or otherwise fail to comply with their contractual obligations or there are delays entering commercial supply agreements due to capital constraints, we may have insufficient quantities of material to support ongoing and/or planned clinical trials or to meet commercial demand, if approved.

In addition, any delay or interruption in the supply of materials necessary or useful to manufacture our product candidate could delay the completion of our clinical trials, increase the costs associated with our development programs, and depending upon the period of delay, require us to commence new clinical trials at significant additional expense or

terminate the trials completely.

Delays or interruptions in the supply of commercial product could result in increased cost of goods sold and lost sales.

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Our employees, independent contractors and consultants, principal investigators, CROs, CMOs, other vendors, and any future commercial partners may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could cause significant liability for us and harm our reputation.

authorities, to provide accurate information to the FDA or comparable foreign regulatory authorities, to comply with manufacturing standards required by cGMP or our standards, to comply with federal and state healthcare fraud and abuse laws and regulations and similar laws and regulations established and enforced by comparable foreign regulatory authorities, and to report financial information or data accurately or disclose unauthorized activities to them.

We are exposed to the risk that our employees, independent contractors and consultants, principal investigators, CROs, CMOs, other vendors, and any future commercial partners may engage in fraudulent conduct or other misconduct, including intentional failures to comply with FDA regulations or similar regulations of comparable foreign regulatory authorities, to provide accurate information to the FDA or comparable foreign regulatory authorities, to comply with manufacturing standards required by cGMP or our standards, to comply with federal and state healthcare fraud and abuse laws and regulations and similar laws and regulations established and enforced by comparable foreign regulatory authorities, and to report financial information or data accurately or disclose unauthorized activities to them.

The misconduct of our employees and other service providers could involve the improper use of information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation.

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MOLBREEVI has received Orphan Drug Designation from the FDA and the EMA.

If a competitor obtains Orphan Drug exclusivity for a product with the same active ingredient and route of delivery as molgramostim for aPAP, we may be unable to market our product candidate until the exclusivity of the competing product expires.

If a competitor obtains Orphan Drug exclusivity for a product with the same active ingredient and route of delivery as molgramostim for autoimmune PAP, we may be unable to market our product candidate until the exclusivity of the competing product expires.

MOLBREEVI has received Orphan Drug Designation in the U.S.

by the FDA and in Europe by the EMA for the treatment of aPAP.

If approval is received to market MOLBREEVI, the FDA will not approve a similar product, with the same active ingredient, to MOLBREEVI for seven years and the EMA will not approve a similar product to MOLBREEVI for ten years, unless we are unable to produce enough supply to meet demand in the marketplace or another similar product, with the same active ingredient, is deemed clinically superior.

by the FDA and in Europe by the EMA for the treatment of autoimmune PAP.

If approval is received to market MOLBREEVI, the FDA will not approve a similar product, with the same active ingredient as MOLBREEVI, for seven years and the EMA will not approve a similar product to MOLBREEVI for ten years, unless we are unable to produce enough supply to meet demand in the marketplace or another similar product with the same active ingredient is deemed clinically superior.

Similar product candidates with the same active ingredient and route of delivery may be granted Orphan Drug Designation during the development, but the Orphan Drug exclusivity is granted only to the first of such products approved, which means there is risk that a competitor product candidate may receive approval and Orphan Drug exclusivity before us, thus preventing us from marketing our product candidate until the exclusivity of the competing product expires.

Also, the Orphan Drug status will not prevent a competitor with a different active ingredient from competing with our product candidate.

If we are prevented from marketing MOLBREEVI for aPAP due to a competitor’s Orphan Drug exclusivity, it would have a material adverse effect on our business.

If we are prevented from marketing MOLBREEVI for autoimmune PAP due to a competitor’s Orphan Drug exclusivity, it would have a material adverse effect on our business.

We expect competition in the marketplace for our MOLBREEVI product candidate should it receive regulatory approval.

The development and commercialization of new drug products is highly competitive and subject to rapid and significant change.

Developments by others may render potential application of our MOLBREEVI product candidate in aPAP obsolete or noncompetitive, even prior to completion of its development and approval.

Developments by others may render potential application of our MOLBREEVI product candidate in autoimmune PAP obsolete or noncompetitive, even prior to completion of its development and approval.

If successfully developed and approved, we expect our product candidate will face competition.

We may not be able to compete successfully against

organizations with competitive products, particularly large pharmaceutical companies.

We may not be able to compete successfully against organizations with competitive products, particularly large pharmaceutical companies.

Many of our potential competitors have significantly greater financial, technical, and human resources than us, and may be better equipped to develop, manufacture, market, and distribute products.

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Competitive products may be more effective, easier to dose, or more effectively marketed and sold than ours, which would have a material adverse effect on our ability to generate revenue.

Although we are not aware of any companies developing an inhaled form of GM-CSF for the treatment of aPAP, sargramostim (Leukine), a yeast-derived recombinant human granulocyte-macrophage colony stimulating factor, rhu-GM-CSF, which is a product of Partner Therapeutics, Inc., is being pharmacy-compounded and utilized by some patients in the U.S.

for the off-label treatment of aPAP.

We cannot assess the effectiveness of its off-label administration to patients with aPAP or the number of aPAP patients in the U.S.

Although we are not aware of any companies developing an inhaled form of GM-CSF for the treatment of autoimmune PAP, sargramostim (Leukine), a yeast-derived recombinant human granulocyte-macrophage colony stimulating factor, rhu-GM-CSF, which is a product of Partner Therapeutics, Inc., is being pharmacy-compounded and utilized by some patients in the U.S.

for the off-label treatment of autoimmune PAP.

We cannot assess the effectiveness of its off-label administration to patients with autoimmune PAP or the number of autoimmune PAP patients in the U.S.

using Leukine as a pharmacy-compounded off-label treatment.

Additionally, in April 2024, Partner Therapeutics’ partner, Nobelpharma Co.

Ltd., received regulatory approval from the PMDA to market sargramostim for the treatment of aPAP in Japan.

Ltd., received regulatory approval from the PMDA to market sargramostim for the treatment of autoimmune PAP in Japan.

Sargramostim has the potential to present a material competitive threat to the commercial success of MOLBREEVI in Japan which could have a material adverse effect on our business.

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through a focused, specialized sales force, which will be costly and time consuming.

incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel, and effectively manage a geographically dispersed sales and marketing team.

Institutionally, we have no prior experience in the marketing and sale of pharmaceutical products and there are significant risks involved in building and managing a sales organization, including our ability to hire, retain, and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel, and effectively manage a geographically dispersed sales and marketing team.

Outside of the U.S., we may consider collaboration arrangements.

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This includes critical systems such as email, other communication tools, electronic document repositories, and archives.

If any of these third-party IT providers are compromised due to computer viruses, unauthorized access, malware, natural disasters, fire, terrorism, war and telecommunication failures, electrical failures, cyber-attacks, or cyber-intrusions over the internet, then sensitive emails or documents could be exposed or deleted.

If any of these third-party IT providers are compromised due to computer viruses, unauthorized access, malware, natural disasters, fire, terrorism, war, telecommunication failures, electrical failures, cyber-attacks, or cyber-intrusions over the internet, then sensitive emails or documents could be exposed or deleted.

Similarly, we could incur business disruption if our access to the internet is compromised, and we are unable to connect with third-party IT providers.

The risk of a security breach or disruption, particularly through cyber-attacks or cyber-intrusion by computer hackers, foreign

governments, or cyber-terrorists, has generally increased as the number, intensity, and sophistication of attempted attacks and intrusions from around the world have increased.

The risk of a security breach or disruption, particularly through cyber-attacks or cyber-intrusion by computer hackers, foreign governments, or cyber-terrorists, has generally increased as the number, intensity, and sophistication of attempted attacks and intrusions from around the world have increased.

In addition, we rely on those third parties to safeguard important confidential personal data regarding our employees and patients enrolled in our clinical trials.

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If we or our vendors fail to comply with data protection laws and regulations, we could be subject to government enforcement actions (which could include civil or criminal penalties), private litigation, and/or adverse publicity, which could negatively affect our operating results and business.

We are subject to a number of state, national, and foreign laws and regulations related to the collection, use, retention, protection, disclosure, transfer, and other processing of personal data, including the EU’s General Data Protection Regulation (“GDPR”).

The scope of these laws can be broad, and the statutory penalties can be high.

In the ordinary course of business, we collect, receive, use, retain, transfer, and otherwise process, personal data and other sensitive and confidential information.

As a result of our data processing activities, we are subject to a number of state, national, and foreign laws and regulations related to the collection, use, retention, protection, disclosure, transfer, and other processing of personal data, including the General Data Protection Regulation (“GDPR”) in the EU, the UK GDPR and Data Protection Act 2018 in the UK, and numerous federal and state laws in the U.S.

The scope of these laws

can be broad, and the statutory penalties can be high.

For example, the GDPR imposes stringent requirements for the processing of personal data of individuals within the EU and provides for substantial penalties for non-compliance that can be up to the greater of €20 million or 4% of global annual revenues.

The legal landscape in this area is rapidly evolving as different jurisdictions adopt new laws governing data privacy, which can differ in scope and applicability, subject to different interpretations, and be inconsistent among jurisdictions.

In 2018, California enacted the California Consumer Privacy Act of 2018, which requires covered companies to provide new disclosures to California consumers and affords those consumers new rights related to their personal data, including the right to opt-out of certain sales of personal information and a private right of action for certain breaches.

Since then, a number of other states have adopted comprehensive data privacy laws, which are either currently effective or scheduled to become effective.

In Canada, both the federal government and certain provinces have also proposed new legislation imposing significant and unprecedented obligations, fines, and liabilities regarding data handling.

As the applicable laws change, we may be required to implement additional mechanisms to comply, which may be difficult to implement and may require us to incur additional costs.

If we or our vendors fail to comply with applicable data privacy laws, we could be

subject to government enforcement actions and significant penalties, and our business could be adversely impacted.

A data security breach or change in applicable privacy or security laws or regulations could require us to devote significant management resources to address the problems created by the breach or such change in laws or regulations, and, further, to expend significant additional resources to upgrade the security measures that we employ to guard against such breaches or comply with such change in laws or regulations, each of which could disrupt our business, operations, and financial condition.

In the U.S., California enacted the California Consumer Privacy Act in 2018, which requires covered companies to provide new disclosures to California consumers and affords those consumers new rights related to their personal data.

Since then, additional states have adopted their own comprehensive data privacy laws.

Outside the U.S., in addition to the GDPR and UK statutes referenced above, many jurisdictions either have data protection laws in place or continue to advance proposals for similar legislation and regulation.

The increasing number, complexity, and potential inconsistency of current and future laws and regulations relating to privacy, data protection, and data security in the U.S.

and other countries make our compliance obligations more difficult and costly.

Because many of these laws are new, there is little clarity as to their interpretation, as well as a lack of precedent for the scope of enforcement.

Although we plan to continue to work to prevent breaches and ensure compliance with applicable laws regarding the protection and unauthorized disclosure of personal information, our efforts may be unsuccessful and result in significant costs.

As the laws to which we are subject increase and the requirements change, we may be required to implement additional mechanisms to comply, which may be difficult and require us to incur additional costs.

If we or our vendors fail to comply with applicable data privacy laws or experience a breach of security that results in unauthorized disclosure of personal information, we could be subject to government investigations and enforcement actions, significant penalties, civil litigation, and reputational harm, and our business could be adversely impacted.

We must comply with the U.S.

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If we are unable to adequately protect our intellectual property rights related to our product candidate, it could have a material adverse effect on our business.

We have no issued patents for MOLBREEVI for the treatment of aPAP and primarily rely on the Orphan Drug exclusivity as our primary barrier to competition.

Our commercial success depends on our ability to adequately protect our intellectual property rights related to MOLBREEVI for the treatment of autoimmune PAP.

We intend to rely on regulatory exclusivity, such as through Orphan Drug exclusivity, as our primary barrier to competition.

Additionally, we have an exclusive supply agreement for the proprietary delivery device used for MOLBREEVI and a proprietary cell bank used in the production of the drug substance.

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For MOLBREEVI, which is administered via nebulization, we may rely on regulatory exclusivity for the combination of MOLBREEVI and its delivery system.

there is no assurance that our MOLBREEVI product and its delivery system, if approved, will benefit from this type of market protection.

We have filed patent applications related to our MOLBREEVI product candidate;

However, there is no assurance that our MOLBREEVI product and its delivery system, if approved, will benefit from this type of market protection.

In addition to regulatory exclusivity, we have sought to protect our intellectual property rights by filing patent applications related to our MOLBREEVI product candidate;

however, there is no guarantee that patents will issue from any pending or future applications or that claims allowed will be sufficient to protect the technology we develop or that is used by us, our CMOs, or our other service providers.

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Our ability to successfully commercialize our product will depend on the extent to which governmental authorities, private health insurers, and other organizations establish what we believe are appropriate coverage and reimbursement for our product.

The containment of healthcare costs has become a priority of federal and state governments worldwide and the prices of drug products have been a focus in this effort.

For example, there have been several recent U.S.

Congressional inquiries and proposed bills designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs, and then President Trump signed four executive orders on July 24, 2020 aimed at bringing down pharmaceutical prices.

The containment of healthcare costs has become a priority of governments worldwide, and the prices of drug products have been a focus in this effort.

For example, President Trump has signed multiple executive orders addressing prescription drug pricing and access, including one in May 2025 aiming to establish a “most favored nation” (“MFN”) drug pricing policy, which would tie U.S.

drug prices to the lowest prices paid for drugs in other countries.

Certain manufacturers have entered into voluntary agreements with the Trump Administration on MFN pricing, and the Centers for Medicare & Medicaid Services has announced initiatives that would take steps to implement MFN pricing for Medicaid and Medicare Parts B and D programs.

Adoption or expansion of MFN pricing policies could result in downward pressure on U.S.

pricing and may impact our decision about when or whether to launch MOLBREEVI in markets outside of the U.S., if approved.

We expect that federal, state, and local governments in the U.S., as well as in other countries, will continue to consider legislation directed at lowering the total cost of healthcare.

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It is uncertain whether and how future legislation, whether domestic or abroad, could affect prospects for our product candidate or what actions federal, state, or private payers for healthcare treatment and services may take in response to any such healthcare reform proposals or legislation.

Furthermore, we expect that healthcare reform measures that may be adopted in the future are unpredictable, and the potential impact on our operations and financial position is uncertain, but may result in more rigorous coverage criteria, lower reimbursement, and additional downward pressure on the price we may receive for approved products.

Furthermore, healthcare reform measures that may be adopted in the future are unpredictable, and the potential impact on our operations and financial position is uncertain, but may result in more rigorous coverage criteria, lower reimbursement, and additional downward pressure on the price we may receive for approved products.

Any reduction in reimbursement from Medicare or other government-funded programs may result in a similar reduction in payments from private payers.

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A successful product liability claim or series of claims brought against us, if judgments exceed our insurance coverage, could consume a significant portion of our cash and adversely affect our business.

If MOLBREEVI is approved, we will be subject to applicable fraud and abuse, anti-kickback, physician payment transparency, and other healthcare laws and regulations, which could expose us to reputational harm, criminal prosecution, civil penalties, and other damages if it is determined we have failed to comply.

Although we do not currently have any drug products on the market, if MOLBREEVI is approved and we begin commercialization, we will be subject to healthcare statutory and regulatory requirements designed to prevent fraud and abuse and increase transparency.

Healthcare providers, physicians, and third-party payers will play a primary role in the recommendation and prescription of MOLBREEVI, and our current and future arrangements with those parties may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which we market, sell, and distribute MOLBREEVI.

The applicable laws and regulations are described under the heading, “ Other Healthcare Laws and Compliance Requirements” in Part I, Item 1 – Business of this annual report on Form 10-K, and include, but are not limited to, the False Claims Act, Anti-Kickback Statute, and Physician Payments Sunshine Act.

Efforts to ensure that our future business arrangements with third parties comply with these laws and regulations could involve substantial costs and may require us to undertake or implement additional policies or measures.

Although we strive to structure our business arrangements to comply with the applicable requirements, we may face claims by private parties, and claims, investigations and other proceedings by governmental authorities, relating to allegations that our business practices violate applicable law.

Any such action against us, even if we successfully defend ourselves against it, could cause reputational harm, result in significant legal expenses, and divert our management’s attention from the

operation of our business.

If courts or governmental authorities conclude that we have violated the law, or we find it necessary or appropriate to settle any such claims, we may be subject to significant civil, criminal, and administrative penalties, damages, fines, exclusion from government funded healthcare programs, such as Medicare and Medicaid, and the curtailment or restructuring of our operations.

Risks Related to our Common Stock

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• announcements by commercial partners or competitors of new commercial products, clinical progress or the lack thereof, significant contracts, commercial relationships, or capital commitments;

• adverse publicity relating to the aPAP market generally, including with respect to other products and potential products in such market;

• adverse publicity relating to the autoimmune PAP market generally, including with respect to other products and potential products in such market;

• the introduction of technological innovations or new therapies that compete with or influence the demand for our product;

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In the past, following periods of volatility in the market price of a company’s securities, such as the decline in our stock price, stockholders have often instituted class action securities litigation against those companies.

For example, in September 2025, a putative class action complaint was filed against the Company and certain of our executive officers asserting violations of federal securities laws, as further described in Note 10.

Commitments in the notes to our consolidated financial statements in this annual report on Form 10-K.

Such litigation, if instituted, could result in substantial costs and diversion of management attention and resources, which could significantly harm our profitability and reputation.

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

What changed 10-K

Item 1A. Risk Factors