What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2021-02-17 compared with 2020-02-26 · 87 added, 104 removed, 605 unchanged (24% of the section changed)

6 unchanged sentences

Secondary objectives include evaluation of histologic changes assessed by hepatic biopsy after 52 weeks of dosing.

VK2809 has been evaluated in six completed clinical studies, which enrolled more than 260 subjects.

To date, no serious adverse events, or SAEs, have been observed in subjects receiving VK2809, and overall tolerability remains encouraging.

VK2809 has been evaluated in seven completed clinical studies, which enrolled more than 300 subjects.

No serious adverse events, or SAEs, have been observed in subjects receiving VK2809 in these completed studies, and overall tolerability remains encouraging.

In addition, the compound has been evaluated in chronic toxicity studies of up to 12 months in duration.

5 unchanged sentences

Preliminary data suggest that VK0214 stimulates ABCD2 expression in an in vitro model and reduces VLCFA levels in an in vivo model of X-ALD.

Pending completion of certain ongoing toxicology studies, we expect to file an investigational new drug application, or IND, to initiate a proof-of-concept study in patients with X-ALD in 2020.

Our second clinical program’s lead drug candidate, VK5 211, is an orally available, non-steroidal selective androgen receptor modulator, or SARM.

In November 2017, we announced positive top-line results from a Phase 2 proof-of-concept clinical trial in 108 patients recovering from non-elective hip fracture sur gery.

In September of 2020, we initiated a randomized, double-blind, placebo controlled Phase 1 single ascending dose, or SAD, and multiple ascending dose, or MAD, clinical trial of VK0214 in healthy subjects.

The primary objectives of the study include evaluation of the safety and tolerability of single and multiple oral doses of VK0214, as well as identification of VK0214 doses for further clinical development in the setting of X-ALD.

Other clinical programs include VK5211, an orally available, non-steroidal selective androgen receptor modulator, or SARM.

In November 2017, we announced positive top-line results from a Phase 2 proof-of-concept clinical trial in 108 patients recovering from non-elective hip fracture surgery.

Top-line data showed that the trial achieved its primary endpoint, demonstrating statistically significant, dose dependent increases in lean body mass, less head, following treatment with VK5211 as compared to placebo.

The study also achieved certain secondary endpoints, demonstrating statistically significant increases in appendicular lean body mass and total lean body mass for all doses of VK5211, compared to placebo.

VK5211 demonstrated encouraging safety and tolerability in this study, with no dru g-related SAEs reported.

VK5211 demonstrated encouraging safety and tolerability in this study, with no drug-related SAEs reported.

Our intent is to continue to pursue partnering or licensing opportunities prior to conducting additional clinical studies.

2 unchanged sentences

Business” of this Annual Report on Form 10-K.

Our Product Pipeline

The following table highlights our product pipeline:

Our Development Pipeline

The following table highlights our current development pipeline:

TRß, thyroid receptor beta;

NASH, nonalcoholic steatohepatitis;

SARM, selective androgen receptor modulator;

X-ALD, X-linked adrenoleukodystrophy.

43 unchanged sentences

VK2809 Summary Characteristics

VK2809 has been evaluated in one Phase 2 clinical trial and five Phase 1 clinical trials.

VK2809 has been evaluated in one Phase 2 clinical trial and six Phase 1 clinical trials.

Based on these clinical and additional preclinical data, we believe VK2809 has the following important characteristics that may benefit patients with metabolic or lipid disorders:

1 unchanged sentence

Current Phase 2 and Phase 1 data suggest VK2809 could reduce liver fat, plasma LDL-C, triglyceride and atherogenic protein levels by greater amounts than existing oral therapies.

Such broad and potent lipid lowering-

activity may be particularly desirable for NASH patients with hypercholesterolemia or dyslipidemia, or among patients with risk factors such as chronic kidn ey disease.

Such broad and potent lipid lowering-activity may be particularly desirable for NASH patients with hypercholesterolemia or dyslipidemia, or among patients with risk factors such as chronic kidney disease.

Encouraging safety profile:

VK2809 has demonstrated encouraging safety to date in over 260 subjects.

VK2809 has demonstrated encouraging safety to date in over 290 subjects from completed studies.

No drug related serious adverse events were observed.

7 unchanged sentences

VK2809’s novel mechanism of action is expected to allow combinability with many existing therapies, leading to enhanced efficacy and potentially delaying transition to subsequent therapies.

Once-daily convenience:

Once-daily oral dosing:

Clinical data suggest that VK2809 has the potential to lower plasma lipid levels in NASH or hypercholesterolemia patients as a once-daily oral therapy.

Phase 1 Clinical Data for VK2809

VK2809 has also been evaluated in five Phase 1 clinical trials.

VK2809 has also been evaluated in seven Phase 1 clinical trials.

The initial Phase 1 safety, tolerability and pharmacokinetic study of VK2809 was conducted in 2006.

6 unchanged sentences

In addition, statistically significant reductions of lipoprotein a, or Lp(a), and apolipoprotein, or Apo(B), which are believed to be positively associated with a patient’s risk of developing cardiovascular disease, were observed in certain cohorts.

In addition, during 2019, VK2809 was evaluated in three additional Phase 1 studies, evaluating the pharmacokinetics, pharmacodynamics, and potential drug-drug interaction of VK2809 when co-administered with a statin, respectively.

In addition, VK2809 was evaluated in five additional Phase 1 studies, evaluating the pharmacokinetics, pharmacodynamics, potential drug-drug interaction of VK2809 when co-administered with a statin, alternative dosing regimens and hepatic impairment, respectively.

VK0214 in X-linked Adrenoleukodystrophy

5 unchanged sentences

Preliminary data suggest that VK0214 stimulates ABCD2 expression in an in vitro model and reduces VLCFA levels in an in vivo model of X-ALD.

Pending completion of certain toxicology studies, we expect to file an IND to conduct a proof-of-concept study in patients with X-ALD in 2020.

In September of 2020, we initiated a randomized, double-blind, placebo controlled Phase 1 SAD and MAD clinical trial of VK0214 in healthy subjects.

X-ALD is a rare, often fatal condition believed to occur with an incidence of approximately one in 17,000 births.

11 unchanged sentences

However, up to 20% of male X-ALD patients develop cerebral involvement later in life, between the ages of 20 and 35 years.

In male children affected by CALD, learning and behavioral problems are often the first

clinical manifestations of disease.

In male children affected by CALD, learning and behavioral problems are often the first clinical manifestations of disease.

In the absence of intervention, patients affected by CALD typically experience rapid degeneration into vegetative state within 3 to 5 years, often resulting in death within 10 years of diagnosis.

20 unchanged sentences

A Selective Androgen Receptor Modulator (SARM) for Hip Fracture

Our second clinical program’s lead drug candidate, VK5211, is an orally available, non-steroidal SARM in development for the treatment of patients recovering from non-elective hip fracture surgery.

VK5211 is an orally available, non-steroidal SARM in development for the treatment of patients recovering from non-elective hip fracture surgery.

VK5211 is designed to selectively produce the therapeutic benefits of testosterone in muscle and bone tissue with improved safety and tolerability.

Tissue selectivity is critical in treating patients recovering from hip fracture.

These patients experience elevated rates of metabolic breakdown of muscle tissue and loss of BMD.

These patients experience elevated rates of metabolic breakdown of muscle tissue and loss of bone mineral density, or BMD.

This results in a loss of muscle strength, an increased risk of additional fractures and increased mortality.

44 unchanged sentences

The primary objective of this clinical trial was to evaluate the safety and tolerability of escalating single doses of VK5211 in healthy male subjects.

Secondary objectives of the first Phase 1 clinical trial included a determination of the pharmacokinetics, or PK, and

pharmacodynamics, or PD, of single escalating doses of VK5211 in healthy male subjects.

The results showed that single doses at the levels administered were well-tolerated and no serious or severe adverse e vents were observed among subjects receiving VK5211.

Secondary objectives of the first Phase 1 clinical trial included a determination of the pharmacokinetics, or PK, and pharmacodynamics, or PD, of single escalating doses of VK5211 in healthy male subjects.

The results showed that single doses at the levels administered were well-tolerated and no serious or severe adverse events were observed among subjects receiving VK5211.

The PD results showed dose-related decreases in total testosterone and sex-hormone binding protein, consistent with the mechanism of action of selective androgen receptor modulation.

A dose-related decre ase in fasting serum high-density lipoprotein, or HDL, was also observed.

A dose-related decrease in fasting serum high-density lipoprotein, or HDL, was also observed.

VK5211 was well-tolerated and demonstrated predictable dose-proportional increases in systemic exposure.

17 unchanged sentences

Improvement in lean body mass:

Clinical data to date suggests VK5211 rapidly stimulates the formation of LBM, an important property for the hip fracture recovery setting, where patients can lose up to 6% of lean body mass in the two months following injury.

Clinical data to date suggests VK5211 rapidly stimulates the formation of lean body mass, or LBM, an important property for the hip fracture recovery setting, where patients can lose up to 6% of lean body mass in the two months following injury.

Improvement in bone growth and density:

19 unchanged sentences

One year mortality in this group is estimated to range from 20% to 30% and an estimated 50% of patients lose the ability to walk independently.

As a result of the loss of

mobility, and additional morbidities caused by the hip fracture, 20% of patients wi ll require stays at long-term care facilities.

As a result of the loss of mobility, and additional morbidities caused by the hip fracture, 20% of patients will require stays at long-term care facilities.

Studies show that following hip fracture, patients experience a severe and rapid decline in LBM and BMD.

These reported rates of decline are 12 to 75 times the rates observed in persons of similar age and demo graphics who have not sustained a hip fracture.

These reported rates of decline are 12 to 75 times the rates observed in persons of similar age and demographics who have not sustained a hip fracture.

Loss of LBM is believed to contribute to morbidity, disability and risk of re-fracture in hip fracture patients.

21 unchanged sentences

We have developed a series of novel compounds with tissue- targeting properties intended to mitigate potential side effects by selectively targeting the enterocyte, or intestinal absorptive cells, in the intestine, to inhibit dietary triglyceride uptake, or the liver, to inhibit de novo triglyceride synthesis.

We plan to conduct further preclinical studies and file an IND with the FDA at a future date.

EPOR Agonist Program

We are developing small molecule agonists of the EPOR for the potential treatment of anemia.

Anemia results from a decrease in red blood cells and is typically experienced by patients with renal complications, cancer patients and HIV/AIDS patients.

These patients currently receive recombinant human EPO and other erythropoiesis-stimulating agents, or ESAs.

Total worldwide sales of these agents are expected to reach approximately $17 billion by 2025.

However, these agents have a number of limitations, including cost of drug manufacturing, cost of treatment, a non-oral route of administration, and potential for immunogenicity, or possibility of inducing an immune response.

Furthermore, ESA treatment is associated with an increased risk of adverse cardiovascular complications in patients with kidney disease when used to increase hemoglobin levels above 13.0 g/dL, and may be related to an increase in mortality in cancer patients.

We believe that our drug candidates have the potential to treat anemia with improved safety, tolerability and route of administration.

We plan to conduct further preclinical studies and file an IND with the FDA at a future date.

We plan to conduct further preclinical studies and file an investigation new drug application, or IND, with the U.S.

Food and Drug Administration, or FDA, at a future date.

The biopharmaceutical industry is characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products.

While we believe that our technology, knowledge, experience and scientific resources provide us with competitive advantages, we face potential competition from many different sources, including commercial biopharmaceutical enterprises, academic institutions, government agencies and private and public research institutions.

Any drug candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

Any drug candidates that we

successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

Many of our competitors have significantly greater financial resources and expertise in research and development, manufacturing, preclinical studies, clinical trials, regulatory approvals and marketing approved products than we do.

Smaller or early-stage companies

may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

Our competitors may succeed in developing technologies and therapies that are more effective, better tolerated or less costly than any that we are developing, or that would render our drug candidates obso lete and noncompetitive.

Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

Even if we obtain regulatory approval of any of our drug candidates, our competitors may succeed in obtaining regulatory approvals for their products earlier than we do.

We will also face competition from these third parties in rec ruiting and retaining qualified scientific and management personnel, in establishing clinical trial sites and patient registration for clinical trials, and in acquiring and in-licensing technologies and products complementary to our programs or advantageou s to our business.

We will also face competition from these third parties in recruiting and retaining qualified scientific and management personnel, in establishing clinical trial sites and patient registration for clinical trials, and in acquiring and in-licensing technologies and products complementary to our programs or advantageous to our business.

The key competitive factors affecting the success of each of our drug candidates, if approved, are likely to be its efficacy, safety, tolerability, frequency and route of administration, convenience and price, the level of branded and generic competition and the availability of coverage and reimbursement from government and other third-party payors.

While no therapies are currently approved for the treatment of non-alcoholic steatohepatitis, we are aware of numerous development-stage programs targeting this disease, including obeticholic acid from Intercept Pharmaceuticals, Inc., elafibranor from Genfit SA, cenicriviroc from Allergan plc (via acquisition of Tobira Therapeutics, Inc.), aramchol from Galmed Pharmaceuticals Ltd., belapectin (GR-MD-02) from Galectin Therapeutics Inc., resmetirom (MGL-3196) from Madrigal Pharmaceuticals, Inc., MSDC-0602K from Cirius Therapeutics, Inc.

(formerly Octeta Therapeutics, LLC), firsocostat (GS-0976) and cilofexor (GS-9674) from Gilead Sciences, Inc., semaglutide from Novo Nordisk A/S, tropifexor from Novartis Pharmaceuticals Corporation, pegbelfermin (BMS-986036) from Bristol-Myers Squibb, NGM282 (aldafermin) and NGM313 (MK-3655) from NGM Biopharmaceuticals, Inc., lanifibranor from Inventiva S.A., and tirzepatide from Eli Lilly and Company.

In addition, we are aware of active programs at 89bio, Inc., Akero Therapeutics, Inc., Albireo Pharma, Inc., Ascletis Biopharmaceutical, AstraZeneca PLC, Boehringer Ingelheim International GmbH, Can-Fite BioPharma Ltd., CytoDyn Inc., Durect Corporation, Enanta Pharmaceuticals, Inc., Enyo Pharma SA, F.

Hoffmann-La Roche AG, Forma Therapeutics, Inc., Gemphire Therapeutics Inc., Hanmi Pharmaceutical Co., Ltd., Hepion Pharmaceuticals, Inc., HighTide Therapeutics Inc ., Immuron Ltd., Ionis Pharmaceuticals, Inc., LifeMax Laboratories, Inc., Lipocine, MediciNova Inc., Merck & Co., Inc., Metacrine, Inc., Nitto Denko Corporation, NorthSea Therapeutics BV, NuSirt Biopharma, Inc., Pfizer Inc., Poxel SA, Sagimet Biosciences, Yuhan Corporation, and Zydus Cadila.

While no therapies are currently approved for the treatment of non-alcoholic steatohepatitis, we are aware of numerous development-stage programs targeting this disease, including obeticholic acid from Intercept Pharmaceuticals, Inc., cenicriviroc from Allergan plc (now part of AbbVie Inc.), resmetirom (MGL-3196) from Madrigal Pharmaceuticals, Inc., arachidyl amido cholanoic acid from Galmed Pharmaceuticals Ltd., belapectin (GR-MD-02) from Galectin Therapeutics Inc., MSDC-0602K from Cirius Therapeutics, Inc.

(formerly Octeta Therapeutics, LLC), tesamorelin from Theratechnologies Inc., firsocostat (GS-0976) and cilofexor (GS-9674) from Gilead Sciences, Inc., semaglutide from Novo Nordisk A/S, NGM282 (aldafermin) and NGM313 (MK-3655) from NGM Biopharmaceuticals, Inc., tropifexor and licogliflozin from Novartis Pharmaceuticals Corporation, pegbelfermin (BMS-986036) and CC-90001 from Bristol-Myers Squibb, lanifibranor from Inventiva S.A., tirzepatide from Eli Lilly and Company, RG7992 from F.

Hoffmann-La Roche AG, and EDP-305 from Enanta Pharmaceuticals, Inc.

In addition, we are aware of active programs at 89bio, Inc., Akero Therapeutics, Inc., Arrowhead Pharmaceuticals, Inc., Ascletis Biopharmaceutical, AstraZeneca PLC, Boehringer Ingelheim International GmbH, Can-Fite BioPharma Ltd., CytoDyn Inc., Durect Corporation, Enyo Pharma SA, Forma Therapeutics, Inc., Hanmi Pharmaceutical Co., Ltd., Hepion Pharmaceuticals, Inc., HighTide Therapeutics Inc., Ionis Pharmaceuticals, Inc., Kowa Company, Ltd., Lipocine, MediciNova Inc., Merck & Co., Inc., Metacrine, Inc., Mitsubishi Tanabe Pharma Corporation, Nitto Denko Corporation, NorthSea Therapeutics BV, NuSirt Biopharma, Inc., Pfizer Inc., Poxel SA, Sagimet Biosciences, Terns Pharmaceuticals, Inc., Yuhan Corporation and Zydus Cadila.

In the U.S., there are currently no marketed therapies for the maintenance or improvement of lean body mass, bone mineral density or physical function in patients recovering from non-elective hip fracture surgery.

However, VK5211, if approved, will face competition from experimental therapies that are in various stages of clinical development for conditions characterized by muscle wasting by companies including GlaxoSmithKline plc and Helsinn Group.

In addition, nutritional and growth hormone-based therapies are sometimes used in patients experiencing muscle wasting.

In the U.S., there are currently no marketed therapies for the treatment of X-ALD.

Hematopoietic stem cell therapy has been used to treat the most severe form of X-ALD, CALD.

In the U.S., there are currently no marketed therapies for the treatment of X-linked X-ALD.

Hematopoietic stem cell therapy has been used to treat CALD, the most severe form of X-ALD.

More recently, gene therapy has been shown to be effective in CALD as well.

However, both treatments are invasive, requiring surgical intervention, and these do not appear to have an effect on the most pervasive form of X-ALD, AMN.

High-dose biotin is under investigation for the treatment of AMN.

There are several experimental therapies that are in various stages of clinical development for X-ALD by companies, including Applied Genetic Technologies Corporation, Biogen Inc., bluebird bio, Inc., Magenta Therapeutics, Inc., MedDay Pharmaceuticals SAS, Minoryx Therapeutics S.L., Neuralgene, Orpheris, Inc., Poxel SA, ReceptoPharm, Inc., SOM Biotech S.L., and Vertex Pharmaceuticals, Inc., which may be competitive with VK0214, if approved.

However, both treatments are invasive, requiring surgical intervention, and these do not appear to have an effect on AMN, the most pervasive form of X-ALD.

There are several experimental therapies that are in various stages of clinical development for X-ALD by companies, including Autobahn Therapeutics, bluebird bio, Inc., Minoryx Therapeutics S.L., Neuralgene, Orpheris, Inc., Poxel SA, ReceptoPharm, Inc.

and SwanBio Therapeutics, Inc., which may be competitive with VK0214, if approved.

Manufacturing and Supply

3 unchanged sentences

We believe that a majority of the existing API will be suitable for formulation into clinical trial material.

We also have identified multiple contract manufacturers to provide commercial supplies of the formulated drug candidates if they are approved for marketing.

We also have identified multiple

contract manufacturers to provide commercial supplies of the formulated drug candidates if they are approved for marketing.

We intend to secure contract manufacturers with established track records of quality product supply and significant experience with the regulatory requirements of the FDA and the European Medicines Agency, or EMA.

14 unchanged sentences

As partial consideration for the grant of the rights and licenses to us under the Master License Agreement, we issued to Ligand at the closing of our initial public offering of our common stock, or the IPO, 3,655,964 shares of our common stock having an estimated aggregate value of $29.2 million.

Furthermore, as partial consideration for the grant of the rights and licenses to us under the Master License Agreement, we entered into the Loan and Security Agreement with Ligand (as discussed below).

As further partial consideration for the grant of the rights and licenses to us by Ligand under the Master License Agreement, we have agreed to pay to Ligand certain one-time, non-refundable milestone payments in connection with Licensed Products containing (1) VK2809, VK0214 or any other TRß Compound, in an aggregate amount of up to $75.0 million per indication (for up to a total of three indications) upon the achievement of certain development and regulatory milestones and up to $150.0 million upon the achievement of certain sales milestones;

4 unchanged sentences

Additionally, we will pay to Ligand a one-time, non-refundable milestone payment of $2.5 million upon the occurrence of the first commercial sale of VK0612 or any other FBPase Compound by one of our sublicensees.

We will also pay to Ligand royalties on aggregate annual worldwide net sales of Licensed Products by us, our affiliates and our sublicensees at tiered percentage rates in the following ranges based upon net sales:

(a) low-to-middle single digit royalties upon sales of VK2809, VK0214 or any other TRß Compound, (b) upper single digit royalties upon sales of VK5211 or any other SARM Compound, (c) upper single digit royalties upon sales of VK0612 or any other FBPase Compound, (d) low-to-middle single digit royalties upon sales of any DGAT-1

Compound, and (e) middle-to-upper single digit royalties upon sales of any EPOR Compound;

We will also pay to Ligand royalties on aggregate annual worldwide net sales of Licensed Products by us, our affiliates and our sublicensees at tiered percentage rates in the

following ranges based upon net sales:

in each case subject to reduction in certain circumstances.

16 unchanged sentences

Each party’s indemnification obligations will not apply to the extent the claims result from the negligence or willful misconduct of the indemnified party or any of its employees, agents, officers or directors or from the indemnified party’s breach of its representations or warranties set forth in the Master License Agreement.

Loan and Security Agreement

In connection with entering into the Master License Agreement, we entered into a Loan and Security Agreement with Ligand, dated May 21, 2014, as amended on April 8, 2015, January 22, 2016 and May 8, 2017, or the Loan and Security Agreement, pursuant to which, among other things, Ligand agreed to provide us with loans in the aggregate amount of up to $2.5 million.

Pursuant to the Loan and Security Agreement, Ligand loaned us $2.5 million through December 31, 2014.

Each of the loans was evidenced by a Secured Convertible Promissory Note, or the Ligand Note.

On May 21, 2018, the Ligand Note was repaid in full.

Management Rights Letter

As a condition to entering into the Master License Agreement, the Loan and Security Agreement and the Ligand Note, we entered into a Management Rights Letter with Ligand, dated as of May 21, 2014, or the Management Rights Letter.

As a condition to entering into the Master License Agreement, we entered into a Management Rights Letter with Ligand, dated as of May 21, 2014, or the Management Rights Letter.

Pursuant to the Management Rights Letter, we agreed to:

3 unchanged sentences

Furthermore, we agreed to provide Ligand with advance written notice of the date of the annual meeting of our stockholders for each year in which the Ligand Director is up for election so as to permit Ligand to designate the Ligand Director for election at such annual meeting, and to nominate the Ligand Director to our board of directors at each such annual meeting of our stockholders.

In addition, under the Management Rights Letter, we granted Ligand certain contractual management rights in the event Ligand is not represented on our board of directors, including

the right to consult with us and offer advice to our management on significant business issues and the right to receive copi es of all notices, minutes, consents and other material that we provide to our directors, subject to certain exceptions.

We also agreed that, upon the consummation of the IPO, we would appoint a Chairperson of our board of directors who is “independent” un der applicable Securities and Exchange Commission, or SEC, rules and the rules and listings standards of The Nasdaq Stock Market LLC.

In addition, under the Management Rights Letter, we granted Ligand certain contractual management rights in the event Ligand is not represented on our board of directors, including the right to consult with us and offer advice to our management on significant business issues and the right to receive copies of all notices, minutes, consents and other material that we provide to our directors, subject to certain exceptions.

We also agreed that, upon the consummation of the IPO, we would appoint a Chairperson of our board of directors who is “independent” under applicable Securities and Exchange Commission, or SEC, rules and the rules and listings standards of The Nasdaq Stock Market LLC.

In accordance with the terms of the Management Rights Letter, Matthew W.

Foehr was appointed to our board of directors as the Ligand Director and Lawson Macartney, DVM, Ph.D.

was appointed Chairperson of our board of directors.

appointed Chairperson of our board of directors.

The Management Rights Letter will terminate upon the earliest to occur of:

(a) the liquidation, dissolution or indefinite cessation of our business op erations;

(a) the liquidation, dissolution or indefinite cessation of our business operations;

(b) the execution by us of a general assignment for the benefit of creditors or the appointment of a receiver or trustee to take possession of our property and assets;

(c) an acquisition of us by means of any transaction or series of related tran sactions (including, without limitation, any reorganization, merger or consolidation) if our stockholders of record as constituted immediately prior to such transaction hold less than 50% of the voting power of the surviving or acquiring entity;

(d) the da te that Ligand and its affiliates collectively cease to beneficially own at least 7.5% of our outstanding voting stock;

(c) an acquisition of us by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger or consolidation) if our stockholders of record as constituted immediately prior to such transaction hold less than 50% of the voting power of the surviving or acquiring entity;

(d) the date that Ligand and its affiliates collectively cease to beneficially own at least 7.5% of our outstanding voting stock;

or (e) May 21, 2024.

4 unchanged sentences

Registration Rights Agreement

As a condition to the parties entering into the Master License Agreement and the Loan and Security Agreement, we entered into a Registration Rights Agreement, dated May 21, 2014, as amended on January 22, 2016, with Ligand, or the Registration Rights Agreement, pursuant to which we granted certain registration rights to Ligand with respect to (1) the securities issued by us to Ligand pursuant to the Master License Agreement and the securities issuable by us to Ligand pursuant to the Ligand Note, or, collectively, the Viking Securities, (2) the shares of our common stock issued or issuable upon conversion of the Viking Securities, if applicable, and (3) the shares of our common stock issued as a dividend or other distribution with respect to, in exchange for or in replacement of the Viking Securities, or, collectively, the Registrable Securities.

As a condition to the parties entering into the Master License Agreement, we entered into a Registration Rights Agreement, dated May 21, 2014, as amended on January 22, 2016, with Ligand, or the Registration Rights Agreement, pursuant to which we granted certain registration rights to Ligand with respect to (1) the securities issued by us to Ligand pursuant to the Master License Agreement and the securities issuable by us to Ligand pursuant to a Secured Convertible Promissory Note previously issued by us to Ligand, or, collectively, the Viking Securities, (2) the shares of our common stock issued or issuable upon conversion of the Viking Securities, if applicable, and (3) the shares of our common stock issued as a dividend or other distribution with respect to, in exchange for or in replacement of the Viking Securities, or, collectively, the Registrable Securities.

Mandatory Resale Registration Rights

12 unchanged sentences

These sanctions could include the imposition by the FDA or an Institutional Review Board, or IRB, of a clinical hold on clinical trials, the FDA’s refusal to approve pending applications or related supplements, withdrawal of an approval, untitled or warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, restitution, disgorgement, civil penalties or criminal prosecution.

Such actions by government agencies could also require us to expend a large amount of resources to respond to the actions.

actions by government agencies could also require us to expend a large amount of resources to respond to the actions.

Any agency or judicial enforcement action could have a material adverse effect on us.

27 unchanged sentences

They are performed after preliminary evidence suggesting effectiveness of the drug has been obtained, and are intended to further evaluate dosage, effectiveness and safety, to establish the overall benefit-risk relationship of the investigational drug and to provide an adequate basis for product labeling and approval by the FDA.

In most cases, the FDA requires tw o adequate and well-controlled Phase 3 clinical trials to demonstrate the efficacy of the drug in an expanded patient population at multiple clinical trial sites.

In most cases, the FDA requires two adequate and well-controlled Phase 3 clinical trials to demonstrate the efficacy of the drug in an expanded patient population at multiple clinical trial sites.

All clinical trials must be conducted in accordance with FDA regulations, GCP requirements and their protocols in order for the data to be considered reliable for regulatory purposes.

28 unchanged sentences

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

If the NDA submission is accepted for filing, the FDA reviews the NDA to determine, among

other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with cGMP to assure and preserve the product’s identity, strength, quality and purity.

If the NDA submission is accepted for filing, the FDA reviews the NDA to determine, among other things, whether the proposed product is safe and effective for its intended use, and whether the product is being manufactured in accordance with cGMP to assure and preserve the product’s identity, strength, quality and purity.

The FDA has agreed to specific performance goals on the review of NDAs and seeks to review standard NDAs within 12 months from submission of the NDA.

The review process may be extended by the FDA for three additional months to consider certain late submitted i nformation or information intended to clarify information already provided in the submission.

After the FDA completes its initial review of an NDA, it will communicate to the sponsor that the drug will either be approved, or it will issue a complete respon se letter to communicate that the NDA will not be approved in its current form and inform the sponsor of changes that must be made or additional clinical, non-clinical or manufacturing data that must be received before the application can be approved, with no implication regarding the ultimate approvability of the application or the timing of any such approval, if ever.

The review process may be extended by the FDA for three additional months to consider certain late submitted information or information intended to clarify information already provided in the submission.

After the FDA completes its initial review of an NDA, it will communicate to the sponsor that the drug will either be approved, or it will issue a complete response letter to communicate that the NDA will not be approved in its current form and inform the sponsor of changes that must be made or additional clinical, non-clinical or manufacturing data that must be received before the application can be approved, with no implication regarding the ultimate approvability of the application or the timing of any such approval, if ever.

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

The FDA has committed to reviewing such resubmissions in two to six months depending on the type of information included.

The FDA may refer applications for novel drug products or drug products that present difficult questions of safety or effectiv eness to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved and, if so, under what conditions.

The FDA is not bound by the recomm endations of an advisory committee, but it considers such recommendations carefully when making decisions.

The FDA may refer applications for novel drug

products or drug products that present difficult questions of safety or effectiveness to an advisory committee, typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the application should be approved and, if so, under what conditions.

The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.

Before approving an NDA, the FDA typically will inspect the facilities at which the product is manufactured.

26 unchanged sentences

Orphan Designation and Exclusivity

expectation that the cost of developing and making the drug for this type of disease or condition will be recovered from sales in the United States.

The FDA may grant orphan drug designation to drugs intended to treat a rare disease or condition that affects fewer than 200,000 individuals in the United States, or if it affects more than 200,000 individuals in the United States and there is no reasonable expectation that the cost of developing and making the drug for this type of disease or condition will be recovered from sales in the United States.

Orphan drug designation entitles a party to financial incentives such as opportunities for grant funding towards clinical study costs, tax advantages, and user-fee waivers.

31 unchanged sentences

The filing of a patent infringement lawsuit within 45 days of the receipt of a Paragraph IV certification automatically prevents the FDA from approving the ANDA until the earlier of 30 months, expiration of the patent, settlement of the lawsuit or a decision in the infringement case that is favorable to the ANDA applicant.

An applicant submitting an NDA under Section 505(b)(2) of the FDCA, which permits the filing of an NDA where at lea st some of the information required for approval comes from studies not conducted by, or for, the applicant and for which the applicant has not obtained a right of reference, is required to certify to the FDA regarding any patents listed in the Orange Book for the approved product it references to the same extent that an ANDA applicant would.

An applicant submitting an NDA under Section 505(b)(2) of the FDCA, which permits the filing of an NDA where at least some of the information required for approval comes from studies not conducted by, or for, the applicant and for which the applicant has not obtained a right of reference, is required to certify to the FDA regarding any patents listed in the Orange Book for the approved product it references to the same extent that an ANDA applicant would.

Market Exclusivity

3 unchanged sentences

A drug is a new chemical entity if the FDA has not previously approved any other new drug containing the same active moiety, which is the molecule or ion responsible for the action of the drug substance.

During the exclusivity period, the FDA may not accept for review an ANDA or a 505(b)(2) NDA submitted by another company for another version of such drug where the applicant does not own or have a legal right of reference to all the data required for approval.

During the exclusivity period, the FDA may not accept for review an ANDA or a 505(b)(2) NDA submitted by another company for another version of such drug where the

applicant does not own or have a legal right of reference to all the data required for approval.

However, an application may be submitted after four years if it contains a Paragraph IV certification.

22 unchanged sentences

The FDA also may require post-marketing testing, also known as Phase 4 testing, REMS to monitor the effects of an approved product or place conditions on an approval that could restrict the distribution or use of the product.

Discovery of previously unknown problems with a product or the failure to comply with applicable FDA requirements can have negative consequences, including adverse publicity, judicial or administrative enforcement, untitled or warning letters from the FDA, mandated corrective advertising or

communications with doctors, withdrawal of approval, and civil or cri minal penalties, among others.

Newly-discovered or developed safety or effectiveness data may require changes to a product’s approved labeling, including the addition of new warnings and contraindications, and also may require the implementation of other r isk management measures.

Also, new government requirements, including those resulting from new legislation, may be established, or the FDA’s policies may change, which could delay or prevent regulatory approval of our products in development.

2 unchanged sentences

Department of Health and Human Services ( e.g.

, the Office of Inspector General), the Drug Enforcement Administration, the Consumer Product Safety Commission, the Federal Trade Commission, the Occupational Safety & Health Administration, the Environmental Protection Agency, state Attorneys General and other state and local government agencies.

, the Office of Inspector General), the Drug Enforcement Administration, the Consumer Product Safety Commission, the Federal Trade Commission, the Occupational

Safety & Health Administration, the Environmental Protection Agency, state Attorneys General and other state and local government agencies.

For example, sales, marketing and scientific/educational grant programs must comply with the federal Anti-Kickback Statute, the federal False Claims Act of 1986, as amended, or the federal False Claims Act, the privacy regulations promulgated under the Health Insurance Portability and Accountability Act of 1996, as amended, or HIPAA, and similar state laws.

29 unchanged sentences

and generally tend to be priced significantly lower than in the U.S.

As noted above, in the U.S., we are subject to complex laws and regulations pertaining to healthcare “fraud and abuse,” including, but not limited to, the federal Anti-Kick back Statute, the federal False Claims Act, and other state and federal laws and regulations.

The federal Anti-Kickback Statute makes it illegal for any person, including a prescription drug manufacturer, or a party acting on its behalf, to knowingly and w illfully solicit, receive, offer or pay any remuneration that is intended to induce the referral of business, including the purchase, order or prescription of a particular drug, or other good or service for which payment in whole or in part may be made und er a federal healthcare program, such as Medicare or Medicaid.

As noted above, in the U.S., we are subject to complex laws and regulations pertaining to healthcare “fraud and abuse,” including, but not limited to, the federal Anti-Kickback Statute, the federal False Claims Act, and other state and federal laws and regulations.

The federal Anti-Kickback Statute makes it illegal for any person, including a prescription drug manufacturer, or a party acting on its behalf, to knowingly and willfully solicit, receive, offer or pay any remuneration that is intended to induce the referral of business, including the purchase, order or prescription of a particular drug, or other good or service for which payment in whole or in part may be made under a federal healthcare program, such as Medicare or Medicaid.

Violations of this law are punishable by up to five years in prison, criminal fines, administrative civil money penalties and exclusion from participation in federal healthcare programs.

In add ition, many states have adopted laws similar to the federal Anti-Kickback Statute.

Some of these state prohibitions apply to the referral of patients for healthcare services reimbursed by any insurer, not just federal healthcare programs such as Medicare a nd Medicaid.

Due to the breadth of these federal and state anti-kickback laws, the absence of guidance in the form of regulations or court decisions and the potential for additional legal or regulatory change in this area, it is possible that our future sa les and marketing practices or our future relationships with medical professionals might be challenged under anti-kickback laws, which could harm us.

Because we intend to commercialize products that could be reimbursed under a federal healthcare program an d other governmental healthcare programs, we plan to develop a comprehensive compliance program that establishes internal controls to facilitate adherence to the rules and program requirements to which we will or may become subject.

In addition, many states have adopted laws similar to the federal Anti-Kickback Statute.

Some of these state prohibitions apply to the referral of patients for healthcare services reimbursed by any insurer, not just federal healthcare programs such as Medicare and Medicaid.

Due to the breadth of these federal and state anti-kickback laws, the absence of guidance in the form of regulations or court decisions and the potential for additional legal or regulatory change in this area, it is possible that our future sales and marketing practices or our future relationships with medical professionals might be challenged under anti-kickback laws, which could harm us.

Because we intend to commercialize products that could be reimbursed under a federal healthcare program and other governmental healthcare programs, we plan to develop a comprehensive compliance program that establishes internal controls to facilitate adherence to the rules and program requirements to which we will or may become subject.

The federal False Claims Act prohibits anyone from knowingly presenting, or causing to be presented, for payment to federal programs (including Medicare and Medicaid) claims for items or services, including drugs, that are false or fraudulent, claims for items or services not provided as claimed or claims for medically unnecessary items or services.

44 unchanged sentences

The PPACA established the Center for Medicare and Medicaid Innovation within CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending.

Funding has been allocated to support the mission of the Center for Medicare and Medicaid Innovation from 2011 to 2019.

There have been continued public announcements by members of the U.S.

Congress, President Trump and his administration regarding their plans to repeal and replace the PPACA.

For example, on December 22, 2017, President Trump signed into law the Tax

Cuts and Jobs Act of 2017, which, among other things, eliminated the individual mandate requiring most Americans (other than those who quali fy for a hardship exemption) to carry a minimum level of health coverage, effective January 1, 2019.

We cannot predict the ultimate form or timing of any repeal or replacement of the PPACA or the effect such a repeal or replacement would have on our busin ess.

Congress regarding plans to repeal and replace the PPACA.

For example, on December 22, 2017, the Tax Cuts and Jobs Act of 2017 was signed into law, which, among other things, eliminated the individual mandate requiring most Americans (other than those who qualify for a hardship exemption) to carry a minimum level of health coverage, effective January 1, 2019.

President Biden and his administration has announced plans to amend the PPACA to, among other things, expand the scope of the law.

We cannot predict the ultimate form or timing of any repeal, replacement, amendment, expansion or other modification of the PPACA or the effect such a repeal, replacement, amendment, expansion or other modification would have on our business.

Pediatric Exclusivity and Pediatric Use

6 unchanged sentences

A Written Request may include studies for indications that are not currently in the labeling if the FDA determines that such information will benefit the public health.

The FDA will accept the reports upon its determination that the studies were conducted in accordance with, and are responsive to, the original Written Request or commonly accepted scientific principles, as appropriate, and that the reports comply with the FDA’s filing requirements.

The FDA will accept the reports upon its determination that the studies were conducted in accordance with, and are responsive to, the

original Written Request or commonly accepted scientific principles, as appropriate, and that the reports comply with the FDA’s filing requirements.

Under the Pediatric Research Equity Act of 2003, or the PREA, an NDA or supplement thereto must contain data that is adequate to assess the safety and effectiveness of the drug product for the claimed indications in all relevant pediatric subpopulations, and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective.

16 unchanged sentences

VK5211 (SARM)

U.S., Europe, Chile, Argentina, Brazil, Canada, China, India, Japan, Korea, Mexico, Taiwan, and Venezuela

U.S., Europe, Chile, Argentina, Brazil, Canada, China, India, Japan, Korea, Mexico, Taiwan, Venezuela and PCT

U.S., Canada, India, Japan, Korea, Mexico, Australia, China, New Zealand, Argentina, Brazil, Europe, and Israel

VK0612 (FBPase inhibitor)

U.S., China, Hong Kong, Japan, Korea, Australia, Canada, Mexico, India, New Zealand, and Europe

U.S., Korea, Australia, Canada, Mexico, India and New Zealand

DGAT-1 Inhibitors

8 unchanged sentences

We have included our website address in this Annual Report on Form 10-K solely as an inactive textual reference.

As of December 31, 2019, we had sixteen full-time employees and three part-time employees, seven of whom hold a Ph.D.

As of December 31, 2020, we had eighteen full-time employees and two part-time employees, eight of whom hold a Ph.D.

All employees are engaged in research and development, business development and finance.

3 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