What changed in this filing

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Item 1A. Risk Factors

2024-08-01 compared with 2024-05-03 · 37 added, 27 removed, 1017 unchanged (6% of the section changed)

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We have and may continue to commit substantial financial resources with respect to clinical trials that may not be successful, and we may not be able to recoup those investments.

• Although the FDA has granted Fast Track designation for the combination of tobevibart and elebsiran for the treatment of chronic hepatitis delta infection, and might in the future grant Fast Track, Breakthrough Therapy, Priority Review or similar designations to our other product candidates, there can be no assurance that any of our product candidates that receive such designations in the U.S.

or similar designations in any other regulatory jurisdictions will maintain such designations or receive regulatory approval any sooner than other product candidates that do not have such designations, or at all.

• Enrollment and retention of patients in clinical trials is an expensive and time-consuming process and could be delayed, made more difficult or rendered impossible by multiple factors outside our control.

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• We are highly dependent on our key personnel, and if we are not able to retain these members of our management team or recruit and retain additional management, clinical and scientific personnel, our business will be harmed.

• We have experienced significant growth in our organization in recent years and expect to continue to expand, and we may experience difficulties in managing this growth, which could disrupt our operations.

• We have experienced significant growth in our organization in recent years, and we may experience difficulties in managing this growth, which could disrupt our operations.

• If our information systems, or those maintained on our behalf, fail or suffer security breaches, such events could result in, without limitation, the following:

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Although we recorded net income for the years ended December 31, 2022, and 2021, we have otherwise incurred net losses since inception in April 2016.

We had net loss of $65.3 million and net loss of $141.0 million for the three months ended March 31, 2024 and 2023, respectively.

As of March 31, 2024, we had an accumulated deficit of $303.1 million.

We had net loss of $203.7 million and $335.7 million for the six months ended June 30, 2024 and 2023, respectively.

As of June 30, 2024, we had an accumulated deficit of $441.5 million.

We expect to continue to incur significant expenses and will continue to incur net losses in the foreseeable future.

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Furthermore, if we or our collaborators experience inventory revaluation adjustments, lower of cost or market inventory adjustments, and excess inventory, it may be necessary to write down or write-off inventory or incur an impairment charge with respect to the facility where such product is manufactured, which could adversely affect our operating results.

For example, during the year ended December 31, 2023, we released approximately $35.7 million of constraint related to sotrovimab due to changes in estimated allowable manufacturing expenses as agreed to with GSK.

Due to the evolving COVID-19 landscape and based on discussions with the FDA, we and GSK do not plan to file a BLA for sotrovimab at this time.

Furthermore, foreign regulatory authorities may impose similar limitations to the FDA on the use of sotrovimab in jurisdictions where sotrovimab has been granted EUA, temporary authorization or marketing approval.

Although certain countries outside the U.S.

continue to maintain access to 500 mg IV while noting that the clinical efficacy is unknown or uncertain against existing and emerging Omicron variants, we cannot predict whether other countries will limit the use of sotrovimab.

Even if we were to file a BLA or marketing applications in other jurisdictions, it is possible that the FDA and other regulatory authorities may not grant sotrovimab full marketing approval for the treatment of COVID-19, or that any such marketing approvals, if granted, may have similar or other significant limitations on its use.

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If we are unable to raise capital when needed, we could be forced to delay, reduce or terminate certain of our development programs or other operations.

As of March 31, 2024, we had cash, cash equivalents and investments of $1.51 billion.

Based upon our current operating plan, we believe that the $1.51 billion as of March 31, 2024 will fund our current operating plans for at least the next 12 months.

As of June 30, 2024, we had cash, cash equivalents and investments of $1.43 billion.

Based upon our current operating plan, we believe that the $1.43 billion as of June 30, 2024 will fund our current operating plans for at least the next 12 months.

However, our operating plan may change as a result of many factors currently unknown to us, and we may need to seek additional financing to fund our long-term operations sooner than planned.

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We are also evaluating additional combinations with other immunotherapy agents and direct acting antiviral agents.

We also have a Phase 2 clinical trial evaluating elebsiran and tobevibart as a monotherapy or in combination for the treatment of chronic HDV.

We also have a Phase 2 clinical trial evaluating tobevibart as a monotherapy or in combination with elebsiran for the treatment of chronic HDV.

Even if any product candidate we develop were to receive marketing approval or be commercialized for use in combination with other existing therapies, we would continue to be subject to the risks that the FDA or comparable foreign regulatory authorities could revoke approval of the therapy used in combination with our product candidate.

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Differences between preliminary or interim data and final data could significantly harm our business prospects and may cause the trading price of our common stock to fluctuate significantly.

Although the FDA has granted Fast Track designation for the combination of tobevibart and elebsiran for the treatment of chronic hepatitis delta infection, and might in the future grant Fast Track, Breakthrough Therapy, Priority Review or similar designations to our product candidates, there can be no assurance that any of our product candidates that receive such designations in the U.S.

Fast Track designation is intended to facilitate the development and expedite the review of new therapies to treat serious conditions with unmet medical needs by providing sponsors with the opportunity for frequent interactions with the FDA.

Breakthrough Therapy designation is designed to expedite the development and review of drugs that are intended to treat serious conditions and for which preliminary clinical evidence indicates substantial improvement over available therapies on clinically significant endpoint(s).

Priority Review designation is for drugs that, if approved, would be significant improvements in the safety or effectiveness of the treatment or prevention of serious conditions.

Product candidates that receive Fast Track or Breakthrough Therapy designation may receive more frequent interactions with the FDA regarding the product candidate’s development plan and clinical trials and may be eligible for the FDA’s Rolling Review and Priority Review.

Priority Review designation is intended to direct overall attention and resources of the FDA to the evaluation of such applications and means that the FDA’s goal is to take action on such applications within 6 months, compared to 10 months under standard review.

On June 26, 2024, we announced that the FDA granted Fast Track designation for the combination of tobevibart and elebsiran for the treatment of chronic hepatitis delta infection.

We can provide no assurances that this product candidate or any of our other product candidates that receive Fast Track, Breakthrough Therapy, Priority Review or similar designations in the U.S.

or in any other regulatory jurisdictions will receive regulatory approval any sooner than other product candidates that do not have such designations, or at all.

The FDA or any foreign regulatory authorities may also withdraw or revoke any such designation, or elect to treat designated candidates in a manner different from what was originally indicated, if determined that any such product candidates that receive such designations no longer meet the relevant criteria.

Failure to realize the potential benefits of any of these designations could materially and adversely affect our business, financial condition, cash flows and results of operations.

Clinical product development involves a lengthy and expensive process.

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We also use CRISPR gene-editing technology as a research tool to systematically identify human genes that control infection.

Public perception may be influenced by claims that CMV technology is unsafe and products incorporating this technology may not gain the acceptance of the public or the medical community, or that CRISPR gene-editing technology is unethical or immoral.

Public perception may be influenced by claims that T cell-based viral vector platform technology is unsafe and products incorporating this technology may not gain the acceptance of the public or the medical community, or that CRISPR gene-editing technology is unethical or immoral.

Adverse public attitudes may adversely impact our ability to enroll clinical trials.

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Risks Related to Regulatory Compliance

Any biologic product candidates for which we intend to seek approval may face competition sooner than anticipated.

If we are successful in achieving regulatory approval to commercialize any biologic product candidate faster than our competitors, such product candidates may face competition from biosimilar products.

In the United States, biologic product candidates are subject to approval and licensure under the BLA pathway.

Any product candidates for which we intend to seek approval may face competition sooner than anticipated.

Even if we are successful in achieving regulatory approval to commercialize any product candidate faster than our competitors, such product candidates may face competition from biosimilar or generic products.

In the United States, biologic product candidates are subject to approval and licensure under the BLA pathway and small molecules, such as our siRNA product VIR-2218, under the NDA pathway.

The Biologics Price Competition and Innovation Act of 2009, or BPCIA, creates an abbreviated pathway for the approval of biosimilar and interchangeable biologic products following the approval of an original BLA.

The Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Act, creates a similar pathway for seeking approval of a generic version of an approved, small molecule innovator drug product .

For additional information regarding biosimilars and exclusivity, see the section titled “Business—Government Regulation and Product Approval—Biosimilars and Regulatory Exclusivity” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 26, 2024.

If competitors are able to obtain marketing approval for biosimilars referencing our licensed biologic products after the expiration of applicable periods of regulatory exclusivity, our products may become subject to competition from such biosimilars, with the attendant competitive pressure and potential adverse consequences.

If competitors are able to obtain marketing approval for generics or biosimilars referencing our licensed small molecule or biologic products after the expiration of applicable periods of regulatory exclusivity, our products may become subject to competition from such generics or biosimilars, with the attendant competitive pressure and potential adverse consequences.

Such competitive products may be able to immediately compete with us in each indication for which our product candidates may have received approval.

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We are currently conducting process development and manufacturing material for product candidates of three different therapeutic modalities:

mAbs, HCMV-based vaccines and siRNAs.

mAbs, T cell-based viral vector platform vaccines and siRNAs.

Except for limited early-clinical phase process, analytical and formulation development, cell line development, small-scale non-GMP manufacturing for preclinical studies, and quality control testing capabilities in certain of our facilities that is either established or is currently being built, we do not own or operate facilities for full process development or product manufacturing, storage and distribution, or testing.

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Further, alternative suppliers would require filing and regulatory approvals.

In addition, third party manufacturers may have little or no experience with viral vector products and therefore may require a significant amount of support from us in order to implement and maintain the infrastructure and processes required to manufacture our HCMV vector-based product candidates.

The challenges to HCMV-based vaccine manufacturing include the large size of the virus, which precludes terminal sterile filtration, and that some vectors have a restricted growth phenotype in cells that reduces yields during manufacturing.

The challenges to T cell-based viral vector platform vaccine manufacturing include the large size of the virus, which precludes terminal sterile filtration, and that some vectors have a restricted growth phenotype in cells that reduces yields during manufacturing.

To address these challenges, we have made significant investments in process development and scale-up, largely funded by grants from the Bill & Melinda Gates Foundation.

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However, the existing process will require additional process development and scale-up for later stages of clinical development and commercial supply.

To fulfill our HCMV supply requirements, we may need to secure alternative suppliers and manufacturers viral vector products and/or key raw materials and components, and such alternative suppliers and manufacturers may not have the manufacturing experience or capacity required for HCMV-based vaccine manufacturing, or we may be unable to enter into agreements with them on reasonable terms and in a timely manner.

To fulfill our T cell-based viral vector platform supply requirements, we may need to secure alternative suppliers and manufacturers viral vector products and/or key raw materials and components, and such alternative suppliers and manufacturers may not have the manufacturing experience or capacity required for T cell-based viral vector platform vaccine manufacturing, or we may be unable to enter into agreements with them on reasonable terms and in a timely manner.

Any of these events could lead to clinical trial delays or failure to obtain regulatory approval or impact our ability to successfully commercialize, manufacture or supply our current or any future product candidates once approved.

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We are highly dependent on our key personnel, and if we are not able to retain these members of our management team or recruit and retain additional management, clinical and scientific personnel, our business will be harmed.

We are highly dependent on our management, scientific and medical personnel.

We are highly dependent on our management, clinical and scientific personnel.

Our key personnel may currently terminate their employment with us at any time.

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Additionally, we do not currently maintain “key person” life insurance on the lives of our executives or any of our employees.

We have announced several leadership changes over the past year, including a Chief Executive Officer transition in January 2023 that became effective April 3, 2023.

We have recently announced several leadership changes, including a Chief Executive Officer transition in January 2023 that became effective April 3, 2023.

Management transitions may create uncertainty and involve a diversion of resources and management attention, be disruptive to our daily operations or impact public or market perception, any of which could negatively impact our ability to operate effectively or execute our strategies.

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The failure to successfully integrate these businesses could have a material adverse effect on our business, financial condition, results of operations and prospects.

We have experienced significant growth in our organization in recent years and expect to continue to expand, and we may experience difficulties in managing this growth, which could disrupt our operations.

We have experienced significant growth in the number of our employees and the scope of our operations in recent years at both our sites and remote locations, particularly in the areas of research, development and regulatory affairs, and we expect to continue to experience growth as the clinical development of our product candidates progresses.

We have experienced significant growth in our organization in recent years, and we may experience difficulties in managing this growth, which could disrupt our operations.

In addition, if any of our product candidates receives marketing approval, we will need to build out our sales and marketing capabilities, either on our own or with others.

To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, improve our facilities, and continue to recruit and train additional qualified personnel.

To manage any future growth, we must continue to implement and improve our managerial, operational and financial systems, improve our facilities, and continue to recruit and train additional qualified personnel.

As a result of the global pandemic resulting from COVID-19, the majority of our workforce began working from home in March 2020.

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The expansion of our operations may lead to significant costs and may divert our management and business development resources.

We may not be able to effectively manage the expansion of our operations, recruit and train additional qualified personnel, or succeed at effectively integrating employees that joined during the global pandemic or otherwise joined us as remote workers.

We may not be able to effectively manage any further expansion of our operations, recruit and train additional qualified personnel, or succeed at effectively integrating employees that joined during the global pandemic or otherwise joined us as remote workers.

Any inability to manage growth could delay the execution of our business plans or disrupt our operations.

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Our stock price has been, and in the future, may be, subject to substantial volatility.

From October 11, 2019, our first day of trading on The Nasdaq Global Select Market, or Nasdaq, through April 26, 2024, the closing price of our stock ranged from $7.63 per share to $83.07 per share.

From October 11, 2019, our first day of trading on The Nasdaq Global Select Market, or Nasdaq, through July 26, 2024, the closing price of our stock ranged from $7.63 per share to $83.07 per share.

As a result of the volatility in our stock price, our stockholders could incur substantial losses.

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

What changed 10-Q

Item 1A. Risk Factors