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Item 1. Business

2022-03-11 compared with 2021-03-26 · 236 added, 166 removed, 337 unchanged (54% of the section changed)

Company Overview

We are a biotechnology company advancing new treatments for patients with diseases that are underserved by today’s therapies.

Marketed therapies often leave room for improvements in efficacy, safety, or dosing convenience and also for competitively priced alternatives.

We are a biotechnology company advancing new treatments for patients with serious diseases that are underserved by today’s therapies.

Marketed therapies often leave room for improvements in efficacy, safety, and/or dosing convenience.

We believe that first-generation drugs rarely represent optimal solutions and that the potential exists to develop alternatives that improve patient outcomes, moderate side effects, enhance quality of life, ease access, and augment market competition.

Our business model is to identify product opportunities in indications for which clinical trial data demonstrating compelling proof of concept for a targeted mechanism of action already exists, but the competitive evolution of product profiles and number of entrants appears incomplete.

We intend to prioritize indications in which marketed therapies have not had substantial time to become entrenched and for which fast-follower and biosuperior competition could create significant medical and economic benefit for patients and payors.

We intend to identify and evaluate product concepts that target clinically validated molecular targets using established therapeutic modalities and incorporating proven technologies.

We will prioritize product concepts that combine these approaches to generate clinical and commercial hypotheses that provide an attractive balance of risk and opportunity, thereby representing a compelling allocation of our resources.

To date, this approach has led us to initiate research and development programs for therapeutic monoclonal antibodies for rare diseases.

We have built relevant expertise in monoclonal antibody discovery and engineering, biologics manufacturing, and nonclinical and clinical development for our target indications.

We believe our approach enables rapid discovery and development because we can learn from predecessor programs that have established the clinical proof of concept for the targets and indications we are pursuing.

This pre-existing data informs how we design, select, and develop our product candidates, including in such critical areas as pharmacokinetics, pharmacodynamics, trial endpoints, and the selection and enrollment of patients.

We believe this approach reduces the many risks associated with discovering and developing novel therapeutics.

We have prioritized the development of therapies for thyroid eye disease (“TED”), a debilitating condition caused by an autoimmune reaction whereby the immune system attacks tissues in the orbital socket.

The resulting inflammation causes fluid accumulation and excessive proliferation of fibroblasts leading to proptosis, or displacement of the eye from the socket, and diplopia, or double vision.

Until recently, there were no approved targeted therapies for the treatment of TED.

Patients were instead treated with steroids to reduce inflammation or were treated with surgery or radiation, often with unsatisfactory outcomes.

In early 2020, teprotumumab, a monoclonal antibody that targets IGF-1R, was approved by the U.S.

Food and Drug Administration (“FDA”) for the treatment of TED and is marketed in the United States as Tepezza ® by Horizon Therapeutics.

In patients receiving teprotumumab, proptosis was decreased by greater than 2 mm with 24 weeks of treatment in over 70% of patients compared to similar reductions observed in less than 20% of placebo-treated patients.

We intend to prioritize indications where fast-follower and bio superior competition could create significant medical benefit for patients.

We are engineering medicines to advance patient care.

We intend to identify and evaluate product concepts leveraging clinically validated molecular targets using established therapeutic modalities.

We prioritize product concepts aligned with clinical and commercial hypotheses that we expect will provide an attractive balance of risk and opportunity, thereby representing a compelling allocation of our resources.

We focus on advancing therapeutic antibodies that we either in-license or discover internally, incorporating proprietary monoclonal antibody discovery and optimization platforms to advance clinical candidates with unique characteristics.

To date, this approach has led us to initiate research and development programs for therapeutic monoclonal antibodies for serious diseases.

We have built relevant expertise in monoclonal antibody discovery and engineering, biologics manufacturing, and nonclinical and clinical development for thyroid eye disease (“TED”) and other undisclosed target indications.

Our approach to rapidly discovering and developing novel therapeutics relies on our scientific expertise in evaluating pre-existing proof of concept data for the targets we are pursuing and opportunities to improve upon existing investigational and/or approved therapies.

This approach informs how we design, select, and develop our product candidates, including in such critical areas as pharmacokinetics, pharmacodynamics, trial endpoints, and the selection and enrollment of patients.

We believe this strategy reduces the risks associated with discovering and developing novel therapeutics.

We have prioritized the development of therapies for TED, a debilitating auto-immune disease that causes inflammation and fibrosis of the orbit and tissues surrounding the eye and which can lead to proptosis, or bulging of the eyes, redness and swelling, double vision, pain, and potential blindness.

TED significantly impacts quality of life, imposing a high physical and mental burden on patients.

The only therapy approved by the U.S.

Food and Drug Administration (“FDA”) for TED is Tepezza® (teprotumumab), which is an intravenously administered monoclonal antibody that targets insulin-like growth factor 1 receptor (“IGF-1R”).

Tepezza® is marketed in the United States by Horizon Therapeutics plc.

The reported results obtained with teprotumumab provide strong clinical validation linking the targeting of IGF-1R to clinical benefit in TED.

We believe that there are multiple opportunities to develop fast-follower therapeutics that improve on teprotumumab features including dosing schedule, route of administration, and cost.

We are pursuing multiple programs in parallel to quickly bring these product candidates into clinical trials.

Our first product candidate, VRDN-001, is a humanized monoclonal anti-IGF-1R antibody that we have licensed from ImmunoGen, Inc.

(“ImmunoGen”).

VRDN-001 is the same antibody sequence as AVE-1642, which was previously in development in oncology, where it was administered to over 100 patients with solid tumors.

Despite clear evidence of target engagement, development in oncology of this and other IGF-1R antibodies, including teprotumumab, was largely suspended due to lack of efficacy in late-stage clinical trials.

The successful repurposing of teprotumumab for treatment of TED suggests that VRDN-001 has the potential to demonstrate efficacy in this indication.

We expect to have clinical drug product on hand in the third quarter of 2021 and to file an investigational new drug (“IND”) application or equivalent in the fourth quarter of 2021, with initial proof of concept data in patients expected in the second quarter of 2022.

We are also developing VRDN-002, a next-generation IGF-1R monoclonal antibody, for TED.

VRDN-002 is designed to have a prolonged half-life in circulation, which we believe may reduce the total quantity of antibody that needs to be administered to achieve a therapeutic effect and may mitigate systemic side effects.

We anticipate that this reduction, in turn, may enable administration of VRDN-002 as a subcutaneous injection instead of as an intravenous injection, the route of administration used for both teprotumumab and VRDN-001.

Manufacturing of VRDN-002 is underway, and we expect to file an IND before the end of 2021.

We expect to initiate clinical development with a Phase 1 single ascending dose trial to explore safety, tolerability,

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pharmacokinetics, and target engagement of VRDN-002 in healthy volunteers.

Data from this trial is expected in mid-year 2022, and we expect to initiate the dosing of patients later in 2022.

In addition to developing therapies for TED, we have applied criteria similar to those used to select our TED research and development programs to identify other opportunities to develop fast-follower therapies in other rare disease indications.

However, clinical trials of teprotumumab in TED reported to date used a single dosing regimen, providing little guidance as to the optimal dosing required for clinical activity in TED.

We believe that there are multiple opportunities to develop fast-follower therapeutics that improve on teprotumumab’s features, including dosing schedule, and route of administration.

We are developing two product candidates, VRDN-001 and VRDN-002, to treat patients who suffer from TED.

Our most advanced program, VRDN-001, is a differentiated humanized monoclonal antibody targeting IGF-1R for the treatment for TED.

This antibody was previously studied in over 100 oncology patients as AVE-1642.

The pharmacokinetics, pharmacodynamics, safety, and tolerability data from that clinical program has informed our plans to evaluate VRDN-001 in TED.

In November 2021, we opened an investigational new drug (“IND”) application for VRDN-001 as a new molecular entity and in December 2021, we initiated a Phase 1/2 clinical trial of VRDN-001, which will evaluate proof of concept in TED patients.

Initial proof of concept data in patients are expected in the second quarter of 2022.

VRDN-002, a distinct IGF-1R antibody that incorporates half-life extension technology, is designed to support administration as a convenient, low volume, subcutaneous injection to treat patients who suffer from TED.

In January 2022, we announced FDA clearance of our IND application for VRDN-002.

During the first quarter of 2022, we expect to initiate a Phase 1 single ascending dose trial to explore safety, tolerability, pharmacokinetics, and pharmacodynamic properties of intravenously administered VRDN-002 in healthy volunteers.

Data from this Phase 1 trial will allow us to evaluate the feasibility of a low-volume dosing paradigm and are expected to be announced in mid-2022.

Pending results, we then plan to evaluate the potential efficacy of a low volume subcutaneous injection of VRDN-002 in TED patients.

In addition to developing therapies for TED, we are executing a similar strategic approach to identify opportunities to develop fast-follower therapies in other rare and/or serious disease indications.

We intend to identify and initiate additional programs over time and plan to disclose these when we are closer to initiating clinical trials in these programs.

Our goal is to develop a portfolio of biologic product candidates that improve upon both standard-of-care therapies and offer potential advantages over candidates in development.

Our initial focus for our biologic pipeline is to develop fast followers in indications in which the initially approved products, while efficacious, are incumbent in markets we believe can benefit from new entrants.

We intend to proceed under the assumption that first-in-class products are not necessarily best-in-class products, and that by developing product candidates in areas of well-characterized biology and for which the targets have been clinically de-risked by others, we can develop a pipeline of product candidates with an attractive balance of risk and reward.

Our strategy to achieve this goal is as follows:

• Rapidly advance VRDN-001 in clinical development .

VRDN-001 is based upon AVE-1642, which was administered to over 100 cancer patients.

It was well-tolerated even when co-administered with chemotherapy drugs.

Our goals are to establish proof of concept in patients and explore dose-dependency of VRDN-001 on the clinical manifestations of TED and, if positive, advance to registrational trials.

• Validate the improved half-life of VRDN-002 in the clinic.

VRDN-002 incorporates changes in the antibody Fc region that have been shown to increase the half-lives of other antibodies.

We anticipate initiating a Phase 1 trial of VRDN-002 in healthy volunteers to explore safety, tolerability, pharmacokinetics, and target engagement.

Pending positive results, we then plan to evaluate the potential benefits of VRDN-002 in TED patients.

We believe that an IGF-1R antibody with an improved half-life may lower the dose required for clinical efficacy into the range where low volume subcutaneous dosing may be feasible and expect such administration has the potential to mitigate systemic side effects reported with teprotumumab.

• Invest in the future of IGF-1R product candidates with VRDN-003.

Current IGF-1R antibodies were all generated with the intent of developing them for use in oncology.

We are pursuing multiple hypotheses to expand the treatment paradigm for TED leveraging validated mechanisms, technologies, and modalities.

• Expand our portfolio of targets by broadly searching for new opportunities aligned with our strategy.

We have dedicated resources to seek additional opportunities to develop fast-follower therapeutics for newly validated targets.

Our multidisciplinary search process evaluates scientific and clinical validation, market potential, and feasibility of quickly developing a competitive product.

We aim to build a portfolio of novel product candidates that can match or improve upon the product profile of precedent molecules and can rely on validated targets, proven technologies, and broadly accepted modalities to reduce research and development risk.

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Our mission is to create and advance new biologic treatments for patients suffering from serious diseases that are underserved by today’s therapies.

We are engineering antibodies to develop best-in-class therapies that improve patient care.

Key elements of our business strategy are to:

• Identify opportunities to engineer and develop monoclonal antibodies that optimize patient care.

Our pipeline of therapeutics programs represents a patient-centric model of innovation that leverages proven biology and antibody technology to reduce research and development risk, while striving to address strategic gaps related to access, delivery, quality of life, efficacy, and/or safety and tolerability in targeted therapeutic areas.

Our multidisciplinary search process evaluates scientific and clinical validation of therapeutic targets, market potential, and feasibility of efficiently developing a competitive product.

• Focus on Thyroid Eye Disease (TED) :

◦ Rapidly advance VRDN-001 clinical development to enter the TED market quickly.

Our ongoing clinical trial for VRDN-001 is a Phase 1/2 proof of concept trial that includes multiple randomized, placebo-controlled cohorts of TED patients designed to assess the potential for VRDN-001 to provide improvement of signs and symptoms of TED, including proptosis.

We expect to announce top-line data from the proof-of-concept portion of the trial in the second quarter of 2022.

◦ Offer patients suffering from TED improved convenience and broader settings of care.

Our next generation IGF-1R antibody, VRDN-002, is a humanized monoclonal antibody that incorporates half-life extension technology and is designed to support administration as a convenient, low-volume, subcutaneous injection for the treatment of TED.

We expect to initiate our first-in-human Phase 1 clinical trial of VRDN-002 in the first quarter of 2022, and to announce data from this trial in mid-2022.

The results from this Phase 1 clinical trial will inform the feasibility of a low-volume and/or low-frequency, subcutaneous dosing paradigm for the treatment of TED.

◦ Be a trusted partner in the care of TED patients.

We plan to cultivate a network across TED stakeholders to inform our patient centric approach, including with patients / patient advocacy groups, key opinion leaders, research institutions, healthcare professionals and payers.

◦ Prepare for commercialization of VRDN-001 and VRDN-002 for TED.

We hold worldwide commercialization rights, excluding the greater area of China, to both VRDN-001 and VRDN-002 as well as our other product candidates.

As a result, we have the flexibility to develop and potentially commercialize products ourselves, or alternatively to enter collaborations with industry partners.

• Expand our portfolio beyond TED with strategically aligned opportunities.

We believe there are significant opportunities to provide more convenient, better performing products compared to therapeutics approved or in development for several diseases.

To that end, we continue to invest in portfolio expansion and have dedicated resources to seek additional opportunities to develop best-in-class therapeutics for newly validated targets.

VRDN-004 and VRDN-005 are discovery-stage therapeutic antibody programs for undisclosed diseases.

In our VRDN-004 program, we are currently characterizing leads derived from hit molecules discovered internally.

In our VRDN-005 program, we are targeting opportunities to advance new best-in-class therapeutics.

As part of that effort, we have licensed certain antibody libraries from Xencor, Inc., pursuant to a license agreement we entered into with them in December 2021.

• Leverage our therapeutic antibody and multi-disciplinary search expertise to continue discovering and developing novel, best-in class product candidates.

We plan to continue to identify and advance novel product candidates and technologies to generate best in class antibody therapeutics, either internally or through in-licensing.

We are currently evaluating a number of disease targets and therapeutic candidates with the aim of advancing a steady pipeline of best-in-class product candidates from discovery and preclinical research into clinical trials.

Thyroid Eye Disease (TED)

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Commonly, gaze becomes limited as the eyes become tethered by fibrotic and thickened muscles.

As the process is not perfectly symmetric, one orbit to the other, the eyes will be limited in motility and no longer line up perfectly with each other, causing a misalignment of position that is perceived by the patient as double vision, or diplopia.

As the process is not perfectly symmetric, one orbit to the other, the eyes may have differing motility and no longer line up perfectly with each other, causing a misalignment of position that is perceived by the patient as double vision, or diplopia.

Diplopia in and of itself is a disabling condition that dramatically interferes with most activities of daily living.

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This compression causes loss of central vision, color vision, and visual field and can progress to loss of acuity and eventual blindness.

TED is a disease characterized by an increase in the volume of orbital fat and the extraocular muscles, the muscles around the eye.

Factors that drive the increase include inflammation, the abnormal proliferation of fibroblasts, and the accumulation of fluid which is driven, in turn, by the secretion by fibroblasts of extracellular complex carbohydrates.

From the patients’ perspective, TED causes significant functional changes in the visual system, cosmetic distortion of the facial anatomy and tissue surrounding the eye, inflammatory changes that scar ocular tissue, disabling diplopia that interferes with most activities of daily living, and potential blindness from compression of the optic nerve.

Pathologies Leading to the Development of TED

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IGF-1R, the receptor for IGF-1, is highly expressed in fibrocytes, cells that are derived from the bone marrow and that have the potential to differentiate into either myofibroblasts or fat cells.

IGF-1R and TSHR function in concert to regulate the proliferation and differentiation of these cells in the orbital socket.

IGF-1R and TSHR function in concert to regulate the proliferation and differentiation of fibrocytes in the orbital socket.

One potential cause of TED is autoimmune antibodies against IGF-1R that lead to the activation of IGF-1R, resulting in increased proliferation, secretion of extracellular complex carbohydrates, and differentiation into fat cells.

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Systemic steroids showed limited efficacy for most of the signs and symptoms of TED and are not a sustainable long-range intervention given the side effects.

If steroid treatment proved to be inadequate, or could not be tolerated, the only remaining options for patients were orbital radiation or

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surgery to reduce swelling, decompress orbital contents, and protect the vision.

If steroid treatment proved to be inadequate, or could not be tolerated, the only remaining options for patients were orbital radiation or surgery to reduce swelling, decompress orbital contents, and protect the vision.

Again, each of these therapies was incomplete and inadequate from the perspective of both patient and treating physician.

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Of these, it is estimated that between 20,000 and 25,000 patients in the United States have acute disease that requires intravenous treatment, either with teprotumumab or steroids.

At launch, Horizon Therapeutics announced a price of $14,900 per vial of Tepezza ® which translates to a list price of approximately $343,000 for a six-month course of therapy.

Horizon Therapeutics recently reported full-year 2020 net sales for Tepezza ® of $820 million.

We believe this demonstrates that TED is a large market that will accommodate multiple entrants, with multiple dimensions of potential competition including efficacy and outcomes, safety and tolerability, patient access, and price.

At launch, Horizon Therapeutics plc announced a price of $14,900 per vial of Tepezza ® which translates to a list price of approximately $343,000 for a six-month course of therapy.

Horizon Therapeutics plc reported full-year 2020 and 2021 net sales for Tepezza ® of $820 million and $1.66 billion, respectively, in the first two years of launch.

We believe this demonstrates that TED is a multi-billion dollar market that will accommodate multiple entrants.

Our Product Candidates

The clinical results from teprotumumab serve to validate the role of anti-IGF-1R antibodies in the treatment of TED.

The results reported for clinical trials of teprotumumab in TED highlight the opportunity for us to rapidly develop product candidates that work through a similar mechanism.

First, the majority of TED patients in a clinical trial of teprotumumab responded to treatment, which implies that, in clinically testing of a different IGF-1R antibody, it should be possible to detect clinical signs of improvement in a relatively small cohort of patients.

The clinical data for teprotumumab in TED highlights the opportunity to rapidly develop product candidates that work through a similar mechanism.

First, the majority of TED patients in a clinical trial of teprotumumab responded to treatment, which implies that, in clinical testing of a different IGF-1R antibody, it should be possible to detect clinical signs of improvement in a relatively small cohort of patients.

Second, significant improvements in proptosis were observed within six weeks of dosing, providing the potential to quickly determine if a product candidate is likely to be effective.

In addition, clinical trials for teprotumumab in TED did not explore the dose-dependency of the clinical response with the single teprotumumab dosing regimen selected based on data generated in oncology clinical trials, providing an opportunity to alter the dosing schedule, dosing duration, or route of administration while maintaining or improving efficacy, safety, and/or tolerability.

VRDN-001 is a monoclonal antibody that binds and blocks the IGF-1R signaling pathway with sub-nanomolar affinity.

This mechanism of action is clinically and commercially validated for the treatment of TED (see Figure 1 below).

We are aiming for VRDN-001 to be second to market in this class, with the opportunity to offer less burdensome intravenous (“IV”) dosing, as well as potential to achieve a subcutaneous product presentation that could simplify patient care by obviating the need for infusion center visits, thereby enabling administration in the prescriber’s office, or even potentially at home.

Teprotumumab led to significant reductions in proptosis in as early as six weeks of dosing.

Improvements continued beyond the completion of dosing at 24 weeks.

We exclusively license the worldwide rights to develop and commercialize VRDN-001 for all non-oncology indications that do not use radiopharmaceuticals, including the treatment of TED, from ImmunoGen.

This antibody had previously been developed

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in oncology as AVE-1642 and studied in over 100 patients.

We have an exclusive license to the worldwide rights to develop and commercialize VRDN-001 for all non-oncology indications that do not use radiopharmaceuticals, including the treatment of TED, from ImmunoGen.

This antibody had previously been developed in oncology as AVE-1642 and studied in over 100 patients.

However, development in oncology was stopped in 2009 due to its failure to meet the primary efficacy endpoints in multiple myeloma.

We are developing this antibody sequence as VRDN-001 in TED and anticipate filing an IND with the FDA in the fourth quarter of 2021.

We are developing this antibody sequence as VRDN-001 in TED.

As described below, we have sublicensed the right to develop, manufacture, and commercialize certain IGF-1R directed antibody products for non-oncology indications in the greater area of China to Zenas BioPharma (Cayman) Limited.

A clinical trial conducted by Aventis investigated the safety and efficacy of AVE-1642 in 27 patients with solid tumors when dosed in combination with docetaxel.

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Importantly, there was only a single report of Grade 1/2 hyperglycemia among this group of patients.

However, at least 50% of patients experienced hyperglycemia in subsequent cycles when patients received corticosteroids as premedication for docetaxel.

However, at least 50% of patients experienced hyperglycemia in subsequent cycles when patients received corticosteroids as pre-medication for docetaxel.

Adverse events due to hyperglycemia have been reported for other IGF-1R antibodies, including in 10% of patients treated with teprotumumab.

We intend to more fully assess the association of VRDN-001 monotherapy and hyperglycemia in upcoming clinical trials.

Evidence of target engagement was obtained by assessing the serum levels of biomarkers previously shown to be induced by IGF-1R inhibition.

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Our goal is to explore dose-dependency of VRDN-001 on proptosis in TED.

Dose selection will be informed by VRDN-001 pharmacokinetics and pharmacodynamics reported in previous oncology studies.

Dose selection was informed by VRDN-001 pharmacokinetics and pharmacodynamics reported in previous oncology studies.

We are focused on rapidly determining a minimum effective dose.

If this trial is successful, we plan to quickly move to pivotal studies.

VRDN-002, a Potential Biosuperior IGF-1R Antibody

VRDN-002 is an anti-IGF-1R monoclonal antibody engineered to improve half-life, the duration of exposure in circulation, compared to standard therapeutic antibodies.

Extending antibody half-life may deliver several benefits including subcutaneous administration, less frequent intravenous administration, lower doses, or increased efficacy due to the ability to provide sustained higher drug levels in the body.

VRDN-003, an IGF-1R Antibody Product Specifically Designed for TED

Current IGF-1R antibodies were all generated with the intent of developing them for use in oncology.

We are developing a proprietary antibody product candidate specifically designed for use in treating TED.

Multiple hypotheses are currently being investigated.

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If this trial is successful, we plan to quickly move to pivotal trials.

The first clinical trial for VRDN-001 is a Phase 1/2 proof of concept trial including multiple randomized, placebo-controlled cohorts of TED patients to assess the potential for VRDN-001 to provide rapid improvement of signs and symptoms of TED, including proptosis.

The protocol for this trial allows for additional patient cohorts to assess differing treatment paradigms that may offer advantages over currently available therapies and mitigate patient treatment burden.

We expect to announce top line data from the proof-of-concept portion of the trial in the second quarter of 2022.

VRDN-002, a Potential Best-In-Class IGF-1R Antibody

VRDN-002 is a next generation IGF-1R humanized monoclonal antibody targeting IGF-1R and incorporating half-life extension technology, designed to support administration as a convenient, low-volume, subcutaneous injection for the treatment of TED.

We believe this product profile could expand settings of care by reducing the complexity of administration.

Our first-in-human Phase 1 clinical trial of VRDN-002 is an intravenous, single ascending dose study to explore safety, tolerability, pharmacokinetics, and pharmacodynamics of intravenously administered VRDN-002 in healthy volunteers.

Data from this Phase 1 trial are expected to be announced in mid-2022 and will inform the feasibility of a low-volume subcutaneous dosing paradigm for TED patients.

We believe that VRDN-002 may offer a durable best-in-class profile for a therapeutic antibody targeting IGF-1R for the treatment of TED.

However, to ensure that Viridian is a leader in the development of novel therapies for TED, we are evaluating several hypotheses that may yield a product profile differentiated beyond what VRDN-002 may deliver.

We expect to disclose these hypotheses only if and when we have identified and advanced meaningfully differentiated molecules.

Intellectual Property

As of December 31, 2020, with regard to our VRDN-001 and VRDN-002 product candidates, we have one U.S.

provisional patent application directed to methods of using VRDN-001 and/or VRDN-002 for the treatment of TED.

A patent, if one were to issue, that claims priority to such provisional would be expected to expire no earlier than 2041, without taking potential patent term extensions or disclaimers into account.

As of December 31, 2021, with regard to our VRDN-001 and VRDN-002 product candidates, we have two U.S.

non- provisional patent applications, two PCT applications, two foreign applications, and seven provisional applications directed to compositions and directed to methods of using VRDN-001 and/or VRDN-002 for the treatment of TED.

Any patents that were

to issue from such non-provisional applications would be expected to expire no earlier than 2041, without taking potential patent term extensions or disclaimers into account.

The biotechnology and pharmaceutical industries are characterized by intense and rapidly changing competition to develop new technologies and proprietary products.

Our product candidates may address multiple markets.

Ultimately, the diseases our product candidates target for which we may receive marketing authorization will determine our competition.

Ultimately, the diseases our product candidates target, and for which product candidates we may receive marketing authorization, will determine our competition.

We believe that for most or all of our product development programs, there will be one or more competing programs under development by other companies.

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In many cases, the companies with competing programs will have access to greater resources and expertise than we do and may be more advanced in those programs.

In TED, Horizon Therapeutics’ Tepezza ® is the only FDA-approved medication.

In addition to Tepezza ® , other therapies, such as corticosteroids, have been used on an off-label basis to alleviate some of the symptoms of TED.

Immunovant, Inc.

is also conducting clinical trials of a therapeutic candidate for the treatment of TED.

We expect further entrants to increase competition in this field over time.

We believe that the key competitive factors that will affect the success of any of our product candidates, if commercialized, are likely to be their efficacy, safety, convenience, price, and the availability of reimbursement from government and other third-party payors relative to such competing products.

Our commercial opportunity could be reduced or eliminated if our competitors have products that are superior in one or more of these categories.

Horizon Therapeutics plc’s Tepezza ® is the only FDA-approved medication for TED.

Other therapies, such as corticosteroids, have been used on an off-label basis to alleviate some of the symptoms of TED.

Other companies that are developing TED therapies include Immunovant, Inc., Novartis International AG, Harbour BioMed and Valenza Bio Inc.

License Agreements

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On October 27, 2020, in connection with the closing of the Private Viridian acquisition, we became party to the license agreement with Zenas BioPharma.

In February 2021, we entered into a letter agreement with Zenas BioPharma in which we agreed to provide assistance to Zenas BioPharma with certain manufacturing activities.

The license agreement and letter agreement (collectively, the “Zenas Agreements”) were negotiated with a single commercial objective.

Since February 2021, we have entered into several letter agreements with Zenas BioPharma in which we agreed to provide assistance to Zenas BioPharma with certain development activities, including manufacturing.

The license agreement, as amended, and letter agreements (collectively, the “Zenas Agreements”) were negotiated with a single commercial objective and are treated as a combined contract for accounting purposes.

Under the terms of the Zenas Agreements, we granted Zenas BioPharma an exclusive license to develop, manufacture, and commercialize certain IGF-1R directed antibody products for non-oncology indications in the greater area of China.

As consideration for the Zenas Agreements, we received upfront non-cash consideration and we may receive in the future payment reimbursements for goods and services provided and milestone payments due upon the achievement of specified events.

As consideration for the Zenas Agreements, the transaction price included upfront non-cash consideration and variable consideration in the form of payment for our goods and services provided and milestone payments due upon the achievement of specified events.

Under the Zenas Agreements, we can receive non-refundable milestone payments upon achieving specific milestone events during the contract term.

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Zenas BioPharma is obligated to make royalty payments to us for the royalty term in the Zenas Agreements.

The Zenas Agreements may be considered related party transactions because Tellus BioVentures, a 5% or greater stockholder of our Company (on an as-converted basis, assuming that only the shares of convertible preferred stock held by Tellus BioVentures are converted into shares of our common stock), is also a 5% or greater stockholder of Zenas BioPharma and has a seat on Zenas BioPharma’s board of directors.

License Agreement with ImmunoGen, Inc.

On October 12, 2020, Private Viridian entered into a license agreement with ImmunoGen (the “ImmunoGen License Agreement”), under which we obtained rights to an exclusive, sublicensable, worldwide license to certain patents and other intellectual property rights to develop, manufacture, and commercialize certain products for non-oncology and non-

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radiopharmaceutical indications.

In consideration for rights granted by ImmunoGen, we are obligated to make certain development milestone payments of up to $48.0 million.

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We assumed the ImmunoGen License Agreement in the Merger.

License Agreement with Xencor, Inc.

On December 16, 2020, we entered into a license agreement with Xencor, Inc.

License Agreements with Xencor, Inc.

In December 2020, we entered into a license agreement with Xencor, Inc.

(“Xencor”) (the “Xencor License Agreement”), under which Xencor granted us rights to an exclusive, worldwide, sublicensable, non-transferable, royalty-bearing license to use specified Xencor technology for the research, development, manufacturing, and commercialization of therapeutic antibodies targeting IGF-1R.

In consideration for rights granted by Xencor, we issued 322,407 shares of our Common Stock in December 2020.

In consideration for rights granted by Xencor, we issued 322,407 shares of our common stock to Xencor in December 2020.

The shares were valued at $6.0 million and recorded as research and development expense in 2020.

Under the terms of the Xencor License Agreement, we are obligated to make future development milestone payments of up to $30.0 million.

Under the terms of the Xencor License Agreement, we are obligated to make future development milestone payments of up to

$30.0 million.

Additionally, if we successfully commercialize any product candidate subject to the Xencor License Agreement, we are responsible for royalty payments equal to a percentage in the mid-single digits of net sales and commercial milestone payments of up to $25.0 million.

In December 2021, we entered into a subsequent technology license agreement with Xencor (the “2021 Xencor License Agreement”) for a non-exclusive license to certain antibody libraries developed by Xencor.

Under the 2021 Xencor License Agreement, Xencor we received a one-year research license to review the antibodies and the right to select up to three antibodies for further development.

In consideration for rights granted by Xencor, we issued 394,737 shares of our common stock to Xencor in December 2021.

The shares were valued at $7.5 million and recorded as research and development expense during the year ended December 31, 2021.

Under the terms of the 2021 Xencor License Agreement, for each licensed product, we are obligated to make future milestone payments of up to $27.75 million, which includes development and regulatory milestone payments of up to $4.75 million, special milestone payments of up to $3.0 million, and commercial milestone payments of up to $20.0 million.

Additionally, for each licensed product that we successfully commercialize, we are responsible for royalty payments equal to a percentage in the mid-single digits of net sales.

Government Regulation and Product Approvals

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Satisfaction of FDA pre-market approval requirements typically takes many years, and the actual time required may vary substantially based upon the type, complexity, and novelty of the product or disease.

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Preclinical tests include laboratory evaluation of product chemistry, formulation, and toxicity, as well as animal trials to assess the characteristics and potential safety and efficacy of the product.

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

An IND sponsor must submit the results of preclinical testing to the FDA as part of an IND along with other information, including information about product chemistry, manufacturing and controls, and a proposed clinical trial protocol.

An IND sponsor must submit the results of preclinical testing to the FDA as part

of an IND along with other information, including information about product chemistry, manufacturing and controls, and a proposed clinical trial protocol.

Long-term preclinical tests, such as animal tests of reproductive toxicity and carcinogenicity, may continue after the IND is submitted.

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The FDA reviews an NDA to determine, among other things, whether the drug is safe and effective and whether the facility in which it is manufactured, processed, packaged, or held meets standards designed to assure the product’s continued safety, quality, and purity.

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The FDA may also refer applications for novel drug products, or drug products that present difficult questions of safety or efficacy, to an advisory committee, which is typically a panel that includes clinicians and other experts, for review, evaluation, and a recommendation as to whether the application should be approved.

The FDA is not bound by the recommendation of an advisory committee, but it generally follows such recommendations.

The FDA is not bound by the recommendation of an

advisory committee, but it generally follows such recommendations.

Before approving an NDA, the FDA will typically inspect one or more clinical sites to assure compliance with GCPs.

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A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan designation.

In addition, exclusive marketing rights in the United States may be lost if the FDA

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later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition.

In addition, exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of the product to meet the needs of patients with the rare disease or condition.

Expedited Development and Review Programs

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Once an NDA is approved, a product may be subject to certain post-approval requirements.

For instance, the FDA closely regulates the post-approval marketing and promotion of drugs, including standards and regulations for direct-to-consumer advertising, off-label promotion, industry-sponsored scientific and educational activities, and promotional activities involving

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the internet and social media.

Drugs may be marketed only for the approved indications and in accordance with the provisions of the approved labeling.

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Some countries outside of the United States have a similar process that requires the submission of a clinical trial application (“CTA”) much like the IND prior to the commencement of human clinical trials.

In Europe, for example, a CTA must be submitted to each country’s national health authority and an independent ethics committee, much like the FDA and IRB, respectively.

Once the CTA is approved in accordance with a country’s requirements, a clinical trial may proceed in that country.

To obtain regulatory approval to commercialize a new drug under European Union (“EU”) regulatory systems, we must submit a marketing authorization application (“MAA”).

The MAA is similar to the NDA, with the exception of, among other things, country-specific document requirements.

Regulation in the European Union

Drug and Biologic Development Process

The conduct of clinical trials is currently governed by the EU Clinical Trials Regulation (EU) No.

536/2014 (“CTR”), which entered into force on January 31, 2022.

The CTR introduced a complete overhaul of the previous regulation of clinical trials for medicinal products in the EU, the EU Clinical Trials Directive 2001/20/EC, or Clinical Trials Directive.

The Clinical Trials Directive will expire after a transition period of three years.

During the first year of the transition period, clinical trial sponsors may choose to apply to run a trial under the CTR or under the Clinical Trials Directive.

Under the Clinical Trials Directive, which will expire after a transition period of one or three years, respectively, as outlined below in more detail, before a clinical trial can be initiated it must be approved in each EU Member State where there is a site at which the trial is to be conducted.

The approval must be obtained from two separate entities:

the National Competent Authority (“NCA”) and one or more Ethics Committees.

The NCA of the EU Member States in which the clinical trial will be conducted must authorize the conduct of the trial, and the independent Ethics Committee must grant a positive opinion in relation to the conduct of the clinical trial in the relevant EU Member State before the commencement of the trial.

Any substantial changes to the trial protocol or other information submitted with the clinical trial applications must be submitted to or approved by the relevant NCA and Ethics Committees.

Under the Clinical Trials Directive all suspected unexpected serious adverse reactions to the investigated drug that occur during the clinical trial must be reported to the NCA and to the Ethics Committees of the EU Member State where they occur.

A more unified procedure will apply under the new CTR.

A sponsor will be able to submit a single application for approval of a clinical trial through a centralized EU clinical trials portal.

One national regulatory authority (the reporting EU Member State proposed by the applicant) will take the lead in validating and evaluating the application and will consult and coordinate with the other concerned Member States.

If an application is rejected, it may be amended and resubmitted through the EU clinical trials portal.

If an approval is issued, the sponsor may start the clinical trial in all concerned Member States.

However, a concerned EU Member State may in limited circumstances declare an “opt-out” from an approval and prevent the clinical trial from being conducted in such Member State.

The CTR also aims to streamline and simplify the rules on safety reporting, and introduces enhanced transparency requirements such as mandatory submission of a summary of the clinical trial results to the EU Database.

After several postponements of the coming into effect of the CTR due to technical difficulties with the underlying information technology systems , the “go live” of these systems and, accordingly, the coming into force of the regulation, occurred on January 31, 2022.

The CTR foresees a three-year transition period.

Member States will work in Clinical Trials Information System (“CTIS”) immediately after the system has gone live.

For one year, until 31 January 2023, clinical trial sponsors can still choose whether to submit an initial clinical trial application in line with the current system (Clinical Trials Directive) or via CTIS.

From 31 January 2023, submission of initial clinical trial applications via CTIS becomes mandatory, and by 31 January 2025, all ongoing trials approved under the current Clinical Trials Directive will be governed by the new Regulation and have to be transitioned to CTIS.

Under both the Clinical Trials Directive and the new CTR, national laws, regulations, and the applicable Good Clinical Practice and Good Laboratory Practice standards must also be respected during the conduct of the trials, including the International Council for Harmonization of Technical Requirements for Pharmaceuticals for Human Use (“ICH”) guidelines on Good Clinical Practice (“GCP)” and the ethical principles that have their origin in the Declaration of Helsinki.

During the development of a medicinal product, the European Medical Agency (“EMA”) and national regulators within the EU provide the opportunity for dialogue and guidance on the development program.

At the EMA level, this is usually done in the form of scientific advice, which is given by the Committee for Medicinal Products for Human Use (“CHMP”) on the recommendation of the Scientific Advice Working Party (“SAWP”).

A fee is incurred with each scientific advice procedure, but is significantly reduced for designated orphan medicines.

Advice from the EMA is typically provided based on questions concerning, for example, quality (chemistry, manufacturing and controls testing), nonclinical testing and clinical studies, and pharmacovigilance plans and risk-management programs.

Advice is not legally binding with regard to any future marketing authorization application of the product concerned.

Orphan Designation and Exclusivity

The criteria for designating an orphan medicinal product in the European Union are similar in principle to those in the United States.

The EMA grants orphan drug designation if the medicinal product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition affecting no more than five in 10,000 persons in the European Union (prevalence criterion).

In addition, Orphan Drug Designation can be granted if, for economic reasons, the medicinal product would be unlikely to be developed without incentives and if there is no other satisfactory method approved in the European Union of diagnosing, preventing, or treating the condition, or if such a method exists, the proposed medicinal product is a significant benefit to patients affected by the condition.

An application for orphan drug designation (which is not a marketing authorization, as not all orphan-designated medicines reach the authorization application stage) must be submitted first before an application for marketing authorization of the medicinal product is submitted.

The applicant will receive a fee reduction for the marketing authorization application if the orphan drug designation has been granted, but not if the designation is still pending at the time the marketing authorization is submitted, and sponsors must submit an annual report to EMA summarizing the status of development of the medicine.

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

Designated orphan medicines are eligible for conditional marketing authorization.

The EMA’s Committee for Orphan Medicinal Products reassesses the orphan drug designation of a product in parallel with the review for a marketing authorization;

for a product to benefit from market exclusivity it must maintain its orphan drug designation at the time of marketing authorization review by the EMA and approval by the EC.

Additionally, any marketing authorization granted for an orphan medicinal product must only cover the therapeutic indication(s) that are covered by the orphan drug designation.

Upon the grant of a marketing authorization, orphan drug designation provides up to ten years of market exclusivity in the orphan indication.

During the 10-year period of market exclusivity, with a limited number of exceptions, the regulatory authorities of the EU Member States and the EMA may not accept applications for marketing authorization, accept an application to extend an existing marketing authorization or grant marketing authorization for other similar medicinal products for the same therapeutic

A similar medicinal product is defined as a medicinal product containing a similar active substance or substances as contained in a currently authorized orphan medicinal product, and which is intended for the same therapeutic indication.

An orphan medicinal product can also obtain an additional two years of market exclusivity for an orphan-designated condition when the results of specific studies are reflected in the Summary of Product Characteristics (“SmPC”), addressing the pediatric population and completed in accordance with a fully compliant Pediatric Investigation Plan (“PIP”).

No extension to any supplementary protection certificate can be granted on the basis of pediatric studies for orphan indications.

The 10-year market exclusivity may be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for orphan designation, i.e.

the condition prevalence or financial returns criteria under Article 3 of Regulation (EC) No.

141/2000 on orphan medicinal products.

When the period of orphan market exclusivity for an indication ends, the orphan drug designation for that indication expires as well.

Orphan exclusivity runs in parallel with normal rules on data exclusivity and market protection.

Additionally, a marketing authorization may be granted to a similar medicinal product (orphan or not) for the same or overlapping indication subject to certain requirements.

PRIME Designation

In March 2016, the EMA launched an initiative to facilitate development of product candidates in indications, often rare, for which few or no therapies currently exist.

The Priority Medicines, or PRIME, scheme is intended to encourage drug development in areas of unmet medical need and provides accelerated assessment of products representing substantial innovation reviewed under the centralized procedure.

Products from small- and medium-sized enterprises may qualify for earlier entry into the PRIME scheme than larger companies on the basis of compelling non-clinical data and tolerability data from initial clinical trials.

Many benefits accrue to sponsors of product candidates with PRIME designation, including but not limited to, early and proactive regulatory dialogue with the EMA, frequent discussions on clinical trial designs and other development program elements, and potentially accelerated marketing authorization application assessment once a dossier has been submitted.

Importantly, once a candidate medicine has been selected for the PRIME scheme, a dedicated contact point and rapporteur from the CHMP or from CAT are appointed facilitating increased understanding of the product at EMA’s Committee level.

A kick-off meeting with the CHMP/CAT rapporteur initiates these relationships and includes a team of multidisciplinary experts to provide guidance on the overall development plan and regulatory strategy.

PRIME eligibility does not change the standards for product approval, and there is no assurance that any such designation or eligibility will result in expedited review or approval.

Other Regulations

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Some of our pre-commercial activities are subject to some of these laws.

The federal Anti-Kickback Statute makes it illegal for any person or entity, including a prescription drug manufacturer or a party acting on its behalf, to knowingly and willfully, directly or indirectly, solicit, receive, offer, or pay any remuneration that is intended to induce the referral of business, including the purchase, order, lease of any good, facility, item or service for which

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payment may be made under a federal healthcare program, such as Medicare or Medicaid.

The term “remuneration” has been broadly interpreted to include anything of value.

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In addition, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation.

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

Violations of this law are punishable by up to five years in prison, and can also result in criminal fines, civil money penalties, and exclusion from participation in federal

healthcare programs.

Moreover, a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal civil False Claims Act.

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Among other things, HITECH makes HIPAA’s security standards directly applicable to business associates, defined as independent contractors or agents of covered entities that create, receive, or obtain protected health information in connection with providing a service for or on behalf of a covered entity.

HITECH also increased the civil and criminal penalties that may be imposed against covered entities and business associates and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorney’s fees and costs

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associated with pursuing federal civil actions.

In addition, certain state laws govern the privacy and security of health information in certain circumstances, some of which are more stringent than HIPAA, and many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.

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Certain states also mandate implementation of compliance programs, impose restrictions on drug manufacturer marketing practices, and/or require the tracking and reporting of gifts, compensation, and other remuneration to physicians or drug pricing, and certain states and localities require the registration of pharmaceutical sales representatives.

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

Although the development and implementation of compliance programs designed to establish internal control and facilitate compliance can mitigate the risk of investigation, prosecution, and penalties assessed for violations of these laws, the risks cannot be entirely eliminated.

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

Although the development and implementation of compliance programs designed to establish internal controls and facilitate compliance can mitigate the risk of investigation, prosecution, and penalties assessed for violations of these laws, the risks cannot be entirely eliminated.

Certain states have also adopted comparable privacy and security laws and regulations, some of which may be more stringent than HIPAA.

Such laws and regulations will be subject to interpretation by various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our future customers and strategic partners.

In addition, California enacted the California Consumer Privacy Act (“CCPA”) on June 28, 2018, which went into effect on January 1, 2020.

The CCPA creates individual privacy rights for California consumers and increases the privacy and security obligations of entities handling certain personal data.

The CCPA provides for civil penalties for violations, as well as a private right of action for data breaches that is expected to increase data breach litigation.

The CCPA may increase our compliance costs and potential liability, and many similar laws have been proposed at the federal level and proposed or enacted in other states.

Any liability from failure to comply with the requirements of these laws could adversely affect our financial condition.

Foreign data protection laws, including, without limitation, the EU’s General Data Protection Regulation (“GDPR”) and EU member state data protection legislation, also apply to health-related and other personal data that we process, including, without limitation, personal data relating to clinical trial participants in the EU.

The United Kingdom and Switzerland have also adopted data protection laws and regulations.

The GDPR and implementing EU member state laws impose significant obligations on controllers and processors of personal data, including, among other things, standards relating to the privacy and security of personal data, which require the adoption of administrative, physical, and technical safeguards to protect such information.

These laws also include, without limitation, requirements for establishing an appropriate legal basis for processing personal data, transparency requirements related to communications with data subjects regarding the processing of their personal data, notification requirements to individuals about the processing of their personal data, an individual data rights regime, mandatory data breach notifications, limitations on the retention of personal data, increased requirements pertaining to health data, and strict rules and restrictions on the transfer of personal data outside of the EU, including to the United States.

These laws also impose obligations and required contractual provisions to be included in contracts between companies subject to the GDPR and their third-party processors that relate to the processing of personal data.

The GDPR allows EU member states to make additional laws and regulations further limiting the processing of genetic, biometric, or health data.

Failure to comply with these laws, where applicable, can result in the imposition of significant regulatory fines and penalties.

Additionally, other countries have passed or are considering passing laws requiring local data residency and imposing cross-border data transfer restrictions.

Further, since the United Kingdom’s vote in favor of exiting the EU (often referred to as “Brexit”), there has been uncertainty with regard to data protection regulation in the United Kingdom.

In particular, it is unclear whether the United Kingdom will enact data protection legislation equivalent to the GDPR and how data transfers to and from the United Kingdom will be regulated.

The collection and use of personal health data and other personal information in the European Union is governed by the provisions of the GDPR, which came into force in May 2018 and related implementing laws in individual EU Member States.

The GDPR imposes a number of strict obligations and restrictions on the ability to process (processing includes collection, analysis and transfer of) personal data of individuals within the European Union and in the EEA, including health data from clinical trials and adverse event reporting.

The GDPR also includes requirements relating to the consent of the individuals to whom the personal data relates, the information provided to the individuals prior to processing their personal data or personal health data, notification of data processing obligations to the national data protection authorities and the security and confidentiality of the personal data.

EU Member States may also impose additional requirements in relation to health, genetic and biometric data through their national implementing legislation.

Failure to comply with the requirements of the GDPR and the related national data protection laws of the EU Member States may result in significant monetary fines for noncompliance of up to €20 million or 4% of the annual global revenues of the noncompliant company, whichever is greater, other administrative penalties and a number of criminal offenses (punishable by uncapped fines) for organizations and in certain cases their directors and officers as well as civil liability claims from individuals whose personal data was processed.

Data protection authorities from the different EU Member States may still implement certain variations, enforce the GDPR and national data protection laws differently, and introduce additional national regulations and guidelines, which adds to the complexity of processing personal data in the European Union.

Guidance developed at both EU level and at the national level in individual EU Member States concerning implementation and compliance practices are often updated or otherwise revised.

There is, moreover, a growing trend towards required public disclosure of clinical trial data in the European Union which adds to the complexity of obligations relating to processing health data from clinical trials.

Such public disclosure obligations are provided in the new EU Clinical Trials Regulation, EMA disclosure initiatives and voluntary commitments by industry.

Failing to comply with these obligations could lead to government enforcement actions and significant penalties against us, harm to our reputation, and adversely impact our business and operating results.

The uncertainty regarding the interplay between different regulatory frameworks, such as the Clinical Trials Regulation and the GDPR, further adds to the complexity that we face with regard to data protection regulation.

With regard to the transfer of data from the European Union to the United Kingdom, the Trade and Cooperation Agreement (“TCA”) provided for a transition period of up to six months as of January 1, 2021 to enable the European Commission to complete its adequacy assessment of the UK’s data protection laws.

On June 28, 2021 the European Commission adopted two adequacy decisions for the United Kingdom – one under the GDPR and the other for the Law Enforcement Directive.

Personal data may now freely flow from the European Union to the United Kingdom since the United Kingdom is deemed to have an adequate data protection level.

Additionally, following the UK's withdrawal from the European Union and the EEA, companies also have to comply with the UK’s data protection laws (including the UK GDPR, which is based on the EU GDPR), the latter regime having the ability to separately fine up to the greater of £17.5 million or 4% of global turnover.

The adequacy decisions include a ‘sunset clause’ which entails that the decisions will automatically expire four years after their entry into force.

If our operations are found to be in violation of any of such laws or any other governmental regulations that apply to us, we may be subject to penalties, including, without limitation, significant administrative, regulatory, civil and criminal penalties, damages, fines, disgorgement, contractual damages, reputational harm, diminished profits and future earnings, imprisonment, additional reporting requirements and/or oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, the curtailment or restructuring of our operations, and exclusion from participation in federal and state healthcare programs, any of which could adversely affect our ability to operate our business and our financial results.

These laws or governmental regulations could require us or our collaborators to incur additional costs to achieve compliance, limit our competitiveness, necessitate the acceptance of more onerous obligations in our contracts, restrict our ability to use, store, transfer, and process data, impact our or our collaborators’ ability to process or use data in order to support the provision of our products or services, affect our or our collaborators’ ability to offer our products and services in certain locations, or cause regulators to reject, limit, or disrupt our clinical trial activities.

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Health Reform

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Court of Appeals for the 5th Circuit upheld the District Court ruling that the individual mandate was unconstitutional and remanded the case back to the District Court to determine whether the remaining provisions of the Affordable Care Act are invalid as well.

On November 10, 2020, the Supreme Court heard oral arguments on the case and a decision is expected by the spring 2021.

It is unclear how such litigation and other efforts to repeal, replace or otherwise modify the Affordable Care Act will impact reimbursement of pharmaceutical products.

It is unclear how this decision, future decisions, subsequent appeals, and other efforts to repeal and replace the Affordable Care Act will impact the Affordable Care Act.

In the coming years, additional legislative and regulatory changes could be made to governmental health programs that could significantly impact pharmaceutical companies and the success of their product candidates.

On November 10, 2020, the Supreme Court heard oral arguments on the case.

In June 2021, the Supreme Court held that the states and individuals that brought the lawsuit challenging the Affordable Care Act’s individual mandate did not have standing to challenge the law.

Although the Supreme Court did not reach the merits of the challenge, it vacated the judgment of the Texas U.S.

District Court and remanded the case with instructions to dismiss, effectively ending the case.

There are no changes to our business as a result of the decision, however, in the coming years, additional legislative and regulatory changes could be made to governmental health programs that could significantly impact pharmaceutical companies and the success of their product candidates.

In addition, other legislative changes have been proposed and adopted since the Affordable Care Act was enacted.

In August 2011, the President signed into law the Budget Control Act of 2011, which, among other things, created the Joint Select Committee on Deficit Reduction to recommend to Congress proposals in spending reductions.

In August 2011, President Obama signed into law the Budget Control Act of 2011, which, among other things, created the Joint Select Committee on Deficit Reduction to recommend to Congress proposals in spending reductions.

The Joint Select Committee did not achieve a targeted deficit reduction of at least $1.2 trillion for the years 2013 through 2021, triggering the legislation’s automatic reduction to several government programs.

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Further, manufacturers will have drug product investigation, quarantine, disposition, and notification responsibilities related to counterfeit, diverted, stolen, and intentionally adulterated products, as well as products that are the subject of fraudulent transactions or which are otherwise unfit for distribution such that they would be reasonably likely to result in serious health consequences or death.

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Further, there has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices.

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Congressional inquiries and proposed bills designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs.

In October 2020, the FDA issued guidance describing procedures for manufacturers to facilitate the importation of FDA-approved biologics manufactured abroad and originally intended for sale in a foreign country into the United States.

Previously, the Trump administration released a “Blueprint,” or plan, to lower drug prices and reduce out of pocket costs of drugs that contained proposals to increase drug manufacturer competition, increase the negotiating power of certain federal healthcare programs, incentivize manufacturers to lower the list price of their products, and reduce the out-of-pocket costs of drug products paid by consumers.

Additionally, on November 20, 2020, the Center for Medicare & Medicaid Services (“CMS”) issued an interim final rule implementing a Most Favored Nation (“MFN”) model that would cap the price Medicare can pay for a drug to the lowest price paid in an economically comparable country within the Organization for Economic Cooperation and Development.

The rule was slated to take effect on January 1, 2021, but federal courts have temporarily enjoined implementation of this rule, and the CMS has indicated that the MFN model will not be implemented without further rulemaking proceeding.

The MFN model regulations mandate participation by identified Part B providers and would have applied to all U.S.

states and territories for a seven-year period beginning January 1, 2021, and ending December 31, 2027.

However, on December 29, 2021, CMS rescinded the proposed MFN rule.

Additionally, on December 2, 2020, HHS published a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law.

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

Pursuant to court order, the removal and addition of the aforementioned safe harbors have been delayed until January 1, 2023, requiring manufacturers to ensure the full value of co-pay assistance is passed on to the patient or these dollars will count toward the Average Manufacturer Price and Best Price calculation of the drug.

On May 21, 2021, PhRMA sued the HHS in the U.S.

District Court for the District of Columbia, to stop the implementation of the rule claiming that the rule contradicts federal law surrounding Medicaid rebates.

It is unclear how the outcome of this litigation will affect the rule.

We cannot predict how the implementation of and any further changes to this rule will affect our business.

It is unclear whether or how the Biden administration will move forward with the rule.

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Further, in December 2019, the FDA issued draft guidance describing procedures for drug manufacturers to facilitate the importation of FDA-approved drugs and biologics manufactured abroad and originally intended for sale in a foreign country into the United States.

President Trump’s administration has also proposed to establish an international pricing index that would tie domestic prices for certain drugs and biologics to the prices in other countries.

Although the Biden administration has stayed the effective dates of some last-minute drug price regulations issued by the Trump administration.

Congress and the Biden administration have each indicated that it will continue to seek new legislative and/or administrative measures to control drug costs.

On November 2, 2021, President Biden’s administration announced a new framework for prescription drug pricing.

This plan allows Medicare to negotiate prices for a set number of small molecule drugs that have been on the market for more than nine years, and for biologics that have been on the market for more than 12 years.

The plan also imposes a tax penalty on drug companies that increase prices faster than inflation and lowers out-of-pocket costs for seniors.

Individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.

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The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our product candidates, if approved.

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

Although the Biden administration has stayed the effective dates of some last-minute drug price regulations issued by the Trump administration, Congress and the Biden administration have each indicated that they will continue to seek new legislative and/or administrative measures to control drug costs.

Coverage and Reimbursement

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In particular, in the United States, private health insurers and other third-party payors often provide reimbursement for products and services based on the level at which the government (through the Medicare or Medicaid programs) provides reimbursement for such treatments.

Patients who are prescribed treatments for their conditions and providers performing the prescribed

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services generally rely on third-party payors to reimburse all or part of the associated healthcare costs.

Patients who are prescribed treatments for their conditions and providers performing the prescribed services generally rely on third-party payors to reimburse all or part of the associated healthcare costs.

Patients are unlikely to use products unless coverage is provided and reimbursement is adequate to cover a significant portion of the cost of such products.

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We initially pursued three separate manufacturing paths to supply investigational product for our planned clinical trials in order to mitigate delays and uncertainties.

We currently rely on a single-source CDMO for such manufacturing, although other avenues remain if our current manufacturer were to be negatively impacted.

We currently rely on a single multi-site CDMO for such manufacturing, although other avenues remain if our current manufacturer were to be negatively impacted.

We maintain a long-term master services agreement with our CDMO pursuant to which the CDMO provides biologics development and manufacturing services on a per project basis and a related cell line license.

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We do not currently have arrangements in place for redundant supply.

While any reduction or halt in supply from the CDMO could limit our ability to develop our product candidates until a replacement CDMO is found and qualified, we believe that we have sufficient supply to support our current clinical trial programs.

While any reduction or halt in supply from the CDMO could limit our ability to

develop our product candidates until a replacement CDMO is found and qualified, we believe that we have sufficient supply to support our current clinical trial programs.

Any reduction or halt in supply from the CDMO could limit our ability to develop our product candidates until a replacement CDMO is found and qualified, although we believe that we have supply on hand that can partially support our current clinical trial programs until a replacement CDMO is secured.

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We have not yet defined our sales, marketing, or product distribution strategy for our product candidates because our product candidates are still in preclinical or early-stage clinical development.

Our commercial strategy may include the use of strategic

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partners, distributors, a contract sale force, or the establishment of our own commercial and specialty sales force.

We plan to further evaluate these alternatives as we approach approval for one of our product candidates.

As of December 31, 2020, we employed 27 employees, 26 of which were full-time employees.

Our commercial strategy may include the use of strategic partners, distributors, a contract sale force, or the establishment of our own commercial and specialty sales force.

We plan to further evaluate these alternatives as we continue to advance into later stages of development for each one of our product candidates.

As of December 31, 2021, we had 50 full-time employees located in the United States.

We have never had a work stoppage, and none of our employees is represented by a labor organization or under any collective bargaining arrangements.

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On January 20, 2021, pursuant to the Merger Agreement (as defined below) under which miRagen Therapeutics, Inc.

acquired Viridian Therapeutics, Inc., we changed our name to from Miragen Therapeutics, Inc.

acquired Viridian Therapeutics, Inc., we changed our name from Miragen Therapeutics, Inc.

to Viridian Therapeutics, Inc.

Our common stock currently trades on The Nasdaq Capital Market under the ticker symbol “VRDN.” Our principal executive office is located at 6200 Lookout Road, Boulder, CO 80301, and our telephone number is (720) 643-5200.

Our common stock currently trades on The Nasdaq Capital Market under the ticker symbol “VRDN.” Our principal executive office is located at 221 Crescent Street, Suite 401, Waltham, MA 02453, and our telephone number is (617) 272-4600.

Our website address is www.viridiantherapeutics.com.

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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 1. Business