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Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” and should be carefully considered, together with other information in this Annual Report on Form 10-K and our other filings with the SEC, before making an investment decision regarding shares of our common stock.
−Removed: • We have a limited number of product candidates, all of which are still in preclinical or clinical development.
−Removed: If we do not obtain regulatory approval of one or more of our product candidates, or experience significant delays in doing so, our business will be materially adversely affected.
+Added: • We have a limited number of product candidates, which are still in preclinical or clinical development.
+Added: If we do not obtain regulatory approval of our product candidates, or experience significant delays in doing so, our business will be materially adversely affected.
• Clinical trials are expensive, time consuming, difficult to design and implement, and involve uncertain outcomes.
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• Our product candidates may have undesirable side effects that may delay or prevent marketing approval or, if approval is received, require them to be taken off the market, require them to include safety warnings or otherwise limit their sales.
−Removed: no regulatory agency has made any determination that any of our product candidates are safe or effective for use by the general public for any indication.
−Removed: • We face significant competition, and if our competitors develop and market products that are more effective, safer or less expensive than our product candidates, our commercial opportunities will be negatively impacted.
−Removed: • If any of our product candidates receive regulatory approval, the approved products may not achieve broad market acceptance among physicians, patients, the medical community and third-party payors, in which case revenue generated from their sales would be limited.
+Added: • We face significant competition, and if our competitors develop and market products that are more effective, safer and/or less expensive than our product candidates, our commercial opportunities will be negatively impacted.
+Added: • If zanidatamab or any of our product candidates that receives regulatory approval in the future does not achieve broad market acceptance among physicians, patients, the medical community and third-party payors, revenue generated from royalties or sales would be limited.
• We may not be successful in our efforts to use our therapeutic platforms to build a pipeline of product candidates.
−Removed: • If any product liability lawsuits are successfully brought against us or any of our strategic partners, we may incur substantial liabilities and may be required to limit commercialization of our product candidates.
+Added: • If any product liability lawsuits are successfully brought against us or any of our strategic partners, we may incur substantial liabilities and commercialization efforts of zanidatamab or our product candidates may need to be limited.
• Security breaches and incidents, loss of data and other disruptions could compromise sensitive information related to our business or protected health information or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.
−Removed: • Current and future legislation may increase the difficulty and cost for us to commercialize any products that we or our strategic partners develop and affect the prices we may obtain.
+Added: • Current and future legislation may increase the difficulty and cost for us or our strategic partners to commercialize any approved products that we or our strategic partners develop and affect the prices that may be obtained.
• We have incurred significant losses since inception and anticipate that we will continue to incur losses for the foreseeable future.
−Removed: We have no products approved for commercial sale, and, as of December 31, 2023, we have not generated any revenue or profit from product sales.
+Added: We have only one product approved for commercial sale, and, as of December 31, 2024, we have not received any revenue or profit from product sales.
We may never achieve or sustain profitability.
• We will require substantial additional funding, which may not be available to us on acceptable terms, or at all, and, if not available, may require us to delay, scale back, or cease our product development programs or operations.
+Added: • Our effective tax rate may change in the future.
• We depend on our collaborative relationship with Jazz to further develop and commercialize zanidatamab, and if our relationship is not successful or is terminated, we may be delayed in or unable to effectively develop and/or commercialize zanidatamab, which could have a material adverse effect on our business.
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• We rely on third-party manufacturers to produce our product candidates and on other third parties to provide supplies and store, monitor and transport bulk drug substance and drug product.
−Removed: We and our third-party partners may encounter difficulties with respect to these activities that could delay or impair our ability to initiate or complete our clinical trials or commercialize approved products.
+Added: We and our third-party partners may encounter difficulties with respect to these activities that could delay or impair our ability to initiate or complete our clinical trials or commercialize products.
• We rely on third parties to monitor, support, conduct and oversee clinical trials of the product candidates that we are developing and, in some cases, to maintain regulatory files for those product candidates.
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• If we are unable to protect the confidentiality of our proprietary information, the value of our technology and products could be adversely affected.
−Removed: • Our effective tax rate may change in the future.
• Our stock price is likely to be volatile and the market price of our common stock may drop below the price paid by stockholders.
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Risks Related to Our Business and the Development and Commercialization of Our Product Candidates
−Removed: We have a limited number of product candidates, all of which are still in preclinical or clinical development.
−Removed: If we do not obtain regulatory approval of one or more of our product candidates, or experience significant delays in doing so, our business will be materially adversely affected.
−Removed: We currently have no products approved for sale or marketing in any country, and may never be able to obtain regulatory approval for any of our product candidates.
−Removed: As a result, we are not currently permitted to market any of our product candidates in the United States or in any other country until we obtain regulatory approval from the FDA or comparable regulatory authorities outside the United States.
−Removed: Our product candidates are in preclinical or clinical development and we have not submitted an application, or received marketing approval, for any of our product candidates.
−Removed: Obtaining regulatory approval of our product candidates will depend on many factors, including:
−Removed: • completing clinical trials that demonstrate the efficacy and safety of our product candidates;
+Added: We have a limited number of product candidates, which are still in preclinical or clinical development.
+Added: If we do not obtain regulatory approval of our product candidates, or experience significant delays in doing so, our business will be materially adversely affected.
+Added: Our strategic partner Jazz has received accelerated approval from the FDA for Ziihera® (zanidatamab-hrii) for the treatment of adults with previously-treated, unresectable or metastatic HER2+ BTC.
+Added: Ziihera® is the first product candidate from one of our therapeutic platforms to receive regulatory approval.
+Added: Our other product candidates are in preclinical or clinical development and we have not submitted an application, or received marketing approval, for any other product candidates, and we may never be able to achieve such regulatory approval.
+Added: In addition, although Jazz is developing zanidatamab for regulatory approval in additional indications, such regulatory approval may never be achieved.
+Added: Obtaining regulatory approval and commercializing any approved product candidates depends on many factors, including:
+Added: • successfully completing clinical trials that demonstrate the pre-specified efficacy endpoints and acceptable safety profile of the product candidate in the indication for which approval is sought;
• preparation and submission to the appropriate regulatory authorities of an application for marketing approval that includes substantial evidence of safety, purity and potency from results of nonclinical testing and clinical trials;
−Removed: • establishing and maintaining adequate commercial manufacturing arrangements or establishing our own commercial manufacturing capabilities or reliable arrangements with third-party contract manufacturers;
+Added: • establishing adequate commercial manufacturing arrangements and maintaining a consistent, quality supply of product or establishing our own commercial manufacturing capabilities or reliable arrangements with third-party contract manufacturers;
• potential pre-approval audits of nonclinical sites, clinical trial sites, and third-party manufacturing sites that generated the data and product in support of the marketing application;
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Furthermore, the results of previous preclinical studies and clinical trials may not be predictive of future results, and the results of our current and planned clinical trials may not satisfy the requirements of the FDA or comparable regulatory authorities outside the United States.
−Removed: We have not previously submitted a BLA to the FDA or similar marketing applications to foreign health authorities.
+Added: Although our strategic partner Jazz has submitted a BLA with respect to zanidatamab, we have not submitted a BLA to the FDA or similar marketing applications to foreign health authorities with respect to any of our other product candidates.
A BLA must include extensive preclinical and clinical data and supporting information to establish the product candidate’s safety, purity and efficacy for each desired indication.
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There is typically an extremely high rate of attrition from the failure of product candidates proceeding through preclinical studies and clinical trials.
−Removed: Positive or timely results from preclinical or early-stage trials do not ensure positive or timely results in late-stage clinical trials or product approval by the FDA or comparable regulatory authorities outside the United States.
We will be required to demonstrate with substantial evidence through well-controlled clinical trials that our product candidates are safe and effective for use in a diverse population before we can seek regulatory approvals for their commercial sale.
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In some instances, there can be significant variability in safety or efficacy results between different preclinical studies and clinical trials of the same product candidate due to numerous factors, including changes in clinical trial procedures set forth in protocols, differences in the size and type of the patient populations, changes in and adherence to the clinical trial protocols and the rate of dropout among clinical trial participants.
+Added: Patients treated with our product candidates also may experience side effects or adverse events that are unrelated to our product candidates but may still impact the success of our clinical trials.
+Added: The inclusion of patients with significant co-morbidities in our clinical trials may result in deaths or other adverse medical events due to an underlying condition or other therapies or medications that such patients may be using.
+Added: Any of these events could prevent us from obtaining regulatory approval or achieving or maintaining market acceptance and impair our ability to commercialize our product candidates.
Moreover, success in preclinical studies or early-stage clinical trials does not mean that future clinical trials or registrational clinical trials will be successful because product candidates in later-stage clinical trials may fail to demonstrate sufficient safety and efficacy to the satisfaction of the FDA and comparable regulatory authorities outside the United States, despite having progressed through preclinical studies and initial clinical trials.
Product candidates that have shown promising results in early clinical trials may suffer significant setbacks in subsequent clinical trials or registrational clinical trials.
−Removed: For example, a number of companies in the pharmaceutical industry have suffered significant setbacks in late-stage clinical trials, even after obtaining promising results in earlier-stage clinical trials.
Similarly, interim results of a clinical trial do not necessarily predict final results.
−Removed: There is a high failure rate for biopharmaceutical products proceeding through clinical trials.
−Removed: A number of companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in later stage clinical trials even after achieving promising results in earlier stage clinical trials.
Data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval.
−Removed: In addition, regulatory delays or rejections may be encountered as a result of many factors, including changes in regulatory policy during the period of product development.
−Removed: For example, the FDA’s Oncology Center of Excellence initiated Project Optimus to reform the dose optimization and dose selection paradigm in oncology drug development and Project FrontRunner to help develop and implement strategies to support approvals in the early clinical setting, among other goals.
−Removed: How the FDA plans to implement those goals and their impact on specific clinical programs and the industry are unclear.
−Removed: Applications for our product candidates could fail to receive regulatory approval for many reasons, including but not limited to the following:
−Removed: • the FDA or foreign health authorities may disagree with the design, implementation or data analyses of our clinical trials;
−Removed: • the FDA or foreign health authorities may determine that our product candidate(s) do not have adequate risk-benefit ratio or have undesirable or unintended side effects, toxicities or other characteristics that preclude our obtaining marketing approval or prevent or limit commercial use;
−Removed: • the population studied in the clinical program may not be sufficiently broad or representative to assure efficacy and safety in the full population for which we seek approval;
−Removed: • the FDA or foreign health authorities may disagree with our interpretation of data from preclinical studies or clinical trials;
−Removed: • the data collected from clinical trials of our product candidates may not be sufficient to support the submission of a BLA or other submission or to obtain regulatory approval in the United States or elsewhere;
−Removed: • the FDA or foreign health authorities may fail to approve the manufacturing processes, test procedures and specifications or facilities of third-party manufacturers with which we contract for clinical and commercial supplies;
−Removed: • the approval policies or regulations of the FDA or foreign health authorities may significantly change in a manner rendering our clinical data insufficient for approval.
−Removed: Additionally, we have conducted, and may in the future conduct, clinical trials outside the United States.
−Removed: Although the FDA may accept data from clinical trials conducted outside the United States, acceptance of these data is subject to certain conditions imposed by the FDA and its determination that the trials also complied with all applicable U.S.
+Added: In addition, regulatory delays or rejections may be encountered as a result of many factors, including changes in regulatory policy.
+Added: Applications for our product candidates could fail to receive regulatory approval for many reasons, including:
+Added: • the FDA or foreign health authorities may disagree with the design, implementation or data analyses of clinical trials;
+Added: • the FDA or foreign health authorities may determine that the product candidate(s) do not have adequate risk-benefit ratio or have undesirable or unintended side effects, toxicities or other characteristics that preclude obtaining marketing approval or prevent or limit commercial use;
+Added: • the population studied in the clinical program may not be sufficiently broad or representative to assure efficacy and safety in the full population for which approval is sought;
+Added: • the FDA or foreign regulators may disagree with our interpretation of data from preclinical studies or clinical trials;
+Added: • the data collected from clinical trials of the product candidates may not be sufficient to support the submission of a BLA or other submission or to obtain regulatory approval in the United States or elsewhere;
+Added: • the FDA or foreign health authorities may fail to approve the manufacturing processes, test procedures and specifications or facilities of third-party manufacturers providing our clinical and commercial supplies;
+Added: • the approval policies or regulations of the FDA or foreign health authorities may significantly change in a manner rendering clinical data insufficient for approval.
+Added: We have conducted, and may in the future conduct, clinical trials outside the United States.
+Added: Although the FDA may accept data from clinical trials conducted outside the United States, acceptance of these data is subject to certain conditions imposed by the FDA and its determination that the trials complied with all applicable U.S.
laws and regulations.
−Removed: If the FDA does not accept the data from any clinical trials we conduct outside the United States, it would likely result in the need for additional trials, which would be costly and time-consuming and delay or halt our development of any future product candidates.
−Removed: If clinical trials for our product candidates are prolonged, delayed or stopped, we may be unable to obtain regulatory approval and commercialize our product candidates on a timely basis, or at all, which would require us to incur additional costs and delay our receipt of any product revenue.
−Removed: We currently have two clinical-stage lead product candidates, zanidatamab and zanidatamab zovodotin.
−Removed: Our partner Jazz has been responsible for the conduct of ongoing and future zanidatamab trials since May 2023, and is currently evaluating this product candidate in Phase 1, Phase 2, and Phase 3 clinical trials, including certain ongoing pivotal clinical trials.
−Removed: Following the transfer of certain of our personnel to Jazz in May 2023, we have been focused on the clinical development of zanidatamab zovodotin and our preclinical product candidates and general discovery efforts.
−Removed: We are currently evaluating zanidatamab zovodotin in a Phase 1 clinical trial in patients with recurrent or metastatic HER2-expressing solid tumors.
−Removed: We may experience delays in our ongoing or future preclinical studies or clinical trials, and we do not know whether future preclinical studies or clinical trials will begin on time, need to be redesigned, enroll an adequate number of patients on time or be completed on schedule, if at all.
−Removed: Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain.
−Removed: Failure can occur at any time during clinical development, and, because our product candidates are in an early stage of development, there is a high risk of failure and we may never succeed in developing marketable products.
−Removed: The results of preclinical studies and early clinical trials of our product candidates may not be predictive of the results of later-stage clinical trials, particularly because early trials have smaller numbers of subjects tested.
−Removed: In addition, it is not uncommon for product candidates to exhibit unforeseen safety or efficacy issues, such as immunogenicity, when tested in humans despite promising results in preclinical animal models.
−Removed: Any clinical trials that we may conduct may not demonstrate the safety and efficacy profiles necessary to obtain regulatory approval to market our product candidates.
−Removed: As we continue developing our product candidates, serious adverse events, undesirable side effects, or unexpected characteristics may emerge, causing us to abandon these product candidates or limit their development to more narrow uses or subpopulations in which the risk-benefit ratio is more acceptable.
−Removed: Patients treated with our product candidates may experience side effects or adverse events that are unrelated to our product candidates but may still impact the success of our clinical trials.
−Removed: The inclusion of patients with significant co-morbidities in our clinical trials may result in deaths or other adverse medical events due to an underlying condition or other therapies or medications that such patients may be using.
−Removed: Any of these events could prevent us from obtaining regulatory approval or achieving or maintaining market acceptance and impair our ability to commercialize our product candidates.
−Removed: In some instances, there can be significant variability in safety and efficacy results between different clinical trials of the same product candidate due to a variety of factors, including, but not limited to, changes in trial procedures set forth in protocols, differences in the size and type of the patient populations, changes in and adherence to the clinical trial protocols and the rate of dropout among clinical trial participants.
−Removed: The commencement or completion of these planned clinical trials could be substantially delayed or prevented by many factors, including:
+Added: If the FDA does not accept the data from any clinical trials conducted outside the United States, it would likely result in the need for additional trials, which would be costly and time-consuming and delay or halt development of any future product candidates.
+Added: Even if regulatory approval is obtained for a particular indication, there is no guarantee that additional indications will be approved, which could materially limit the commercial potential of any approved product.
+Added: For example, while Jazz intends to seek approval of zanidatamab in additional indications, we cannot be certain that such approvals will be obtained.
+Added: If additional indications are not approved, our ability to achieve additional milestone payments and royalties on sales of zanidatamab will be materially and negatively impacted.
+Added: If clinical trials for product candidates are prolonged, delayed or stopped, we may be unable to obtain regulatory approval and commercialize product candidates on a timely basis, or at all, which could require us to incur additional costs and delay our receipt of any product revenue.
+Added: We currently have two clinical-stage product candidates, ZW171 and ZW191.
+Added: We have licensed zanidatamab to our strategic partner Jazz, which has been responsible for completing its clinical development in the United States and other jurisdictions not covered by our license to BeiGene.
+Added: In November 2024, Jazz announced the FDA granted accelerated approval for Ziihera ® for injection for intravenous use for the treatment of adults with previously treated, unresectable or metastatic HER2+ (IHC 3+) BTC.
+Added: Jazz is conducting the confirmatory trial for Ziihera ® related to the accelerated approval.
+Added: If the confirmatory trial fails to demonstrate a clinical benefit, the FDA may remove Ziihera ® from the market, which would negatively impact our ability to earn milestone payments and royalties under our arrangement with Jazz.
+Added: Following the transfer of the zanidatamab development program to Jazz and the discontinuation of our zanidatamab zovodotin clinical development program following a strategic business review, we have been focused on the development of our early-stage product candidates and general discovery efforts.
+Added: Following the clearance of our IND applications for both ZW171 and ZW191, we are actively progressing with additional submissions in selected non-U.S.
+Added: countries in relation to our Phase 1 study sites in North America, Europe, and the Asia-Pacific region.
+Added: The commencement or completion of ongoing or planned clinical trials could be substantially delayed or prevented by many factors, including:
• further discussions with the FDA or other regulatory agencies regarding the scope or design of our clinical trials;
−Removed: • the limited number of, and competition for, suitable sites to conduct our clinical trials, many of which may already be engaged in other clinical trial programs, including some that may be for the same indication as our product candidates;
+Added: • the limited number of, and competition for, suitable sites and patients required to conduct our clinical trials, many of which may already be engaged in other clinical trial programs, including some that may be for the same indication as our product candidates;
• any delay or failure to obtain approval or agreement to commence a clinical trial in any of the countries where enrollment is planned;
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• slower than expected rates of patient recruitment and enrollment;
−Removed: • failure of patients to complete the clinical trial;
+Added: • failure of patients to complete the clinical trial or to be lost to follow up;
• the inability to enroll a sufficient number of patients in studies to ensure adequate statistical power to detect statistically significant treatment effects;
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• third-party contractors becoming debarred or suspended or otherwise penalized by the FDA or foreign health authorities for violations of applicable regulatory requirements;
−Removed: • delays in the testing, validation, manufacturing and delivery of our product candidates to the clinical trial sites, including due to a facility manufacturing any of our product candidates or any of their components being ordered by the FDA or foreign health authorities to temporarily or permanently shut down due to violations of current good manufacturing practices (“ cGMP ”) regulations or other applicable requirements, or cross-contaminations of product candidates in the manufacturing process;
+Added: • delays in the testing, validation, manufacturing and delivery of our product candidates to the clinical trial sites, including due to a facility manufacturing any of our product candidates or any of their components being ordered by the FDA or foreign health authorities to temporarily or permanently shut down due to violations of cGMP regulations or other applicable requirements, or cross-contaminations of product candidates in the manufacturing process;
• the need to repeat or terminate clinical trials as a result of inconclusive or negative results or unforeseen complications in testing;
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• receiving untimely or unfavorable feedback from applicable regulatory authorities regarding the trial or requests from regulatory authorities to modify the design of a trial.
−Removed: We could also experience delays in physicians enrolling patients in clinical trials of our product candidates in lieu of prescribing existing treatments or other clinical trials.
−Removed: Furthermore, a clinical trial may be suspended or terminated by us, the IRBs for the institutions in which such trials are being conducted, the Data Monitoring Committee for such trial, or by the FDA or foreign health authorities due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory
−Removed: requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or foreign health authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a product candidate, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial.
+Added: Furthermore, a clinical trial may be suspended or terminated by us, the IRBs for the institutions in which such trials are being conducted, the Data Monitoring Committee for such trial, or by the FDA or foreign health authorities due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or foreign health authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a product candidate, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial.
If we experience termination of, or delays in the completion of, any clinical trial of our product candidates, the commercial prospects for our product candidates will be harmed, and our ability to generate product revenue will be delayed.
In addition, any delays in completing our clinical trials will increase our costs, slow down our product development and approval process and jeopardize our ability to commence product sales and generate revenue.
−Removed: Securing regulatory approval also requires the submission of information about the manufacturing processes and inspection of manufacturing facilities by the relevant regulatory authority.
−Removed: The FDA or foreign health authorities may fail to approve our manufacturing processes or facilities, whether run by us or our contract manufacturing organizations.
−Removed: In addition, if we make manufacturing changes to our product candidates in the future, we may need to conduct additional preclinical and/or clinical studies to bridge our modified product candidates to earlier versions.
Changes in regulatory requirements, policies and guidelines may also occur and we may need to significantly amend clinical trial protocols to reflect these changes with appropriate regulatory authorities.
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Our clinical trials may be suspended or terminated at any time by the FDA, other regulatory authorities, the IRB overseeing the clinical trial at issue, any of our clinical trial sites with respect to that site, or us.
−Removed: Any failure or significant delay in commencing or completing clinical trials for our product candidates would adversely affect our ability to obtain regulatory approval, and our commercial prospects and ability to generate product revenue will be diminished.
−Removed: In addition, even if the trials are successfully completed, clinical data are often susceptible to varying interpretations and analyses, and we cannot guarantee that the FDA or foreign health authorities will interpret the results as we do, and more trials could be required before we submit our product candidates for approval.
+Added: Any failure or significant delay in commencing or completing clinical trials would adversely affect our ability to obtain regulatory approval, and our commercial prospects and ability to generate product revenue will be diminished.
+Added: In addition, even if trials are successfully completed, clinical data are often susceptible to varying interpretations and analyses, and we cannot guarantee that the FDA or foreign health authorities will interpret the results as we do, and more trials could be required before we submit our product candidates for approval.
We cannot guarantee that the FDA or foreign health authorities will view any of our product candidates as having adequate safety and efficacy profiles even if favorable results are observed in these clinical trials, and we may receive unexpected or unfavorable feedback from the FDA or foreign health authorities regarding satisfaction of safety, purity and potency (including clinical efficacy), amongst other factors.
−Removed: To the extent that the results of the trials are not satisfactory to the FDA or foreign health authorities for support of a marketing application, approval of our product candidates may be significantly delayed, or we may be required to expend significant additional resources, which may not be available to us, to conduct additional trials in support of potential approval of our product candidates.
+Added: To the extent the results of the trials are not satisfactory to the FDA or foreign health authorities for support of a marketing application, approval of our
+Added: product candidates may be significantly delayed, or we may be required to expend significant additional resources, which may not be available to us, to conduct additional trials in support of potential approval of our product candidates.
Our long-term prospects depend in part upon discovering, developing and commercializing additional product candidates, which may fail in development or suffer delays that adversely affect their commercial viability.
−Removed: Our future operating results are dependent in part on our ability to successfully discover, develop, obtain regulatory approval for and commercialize product candidates beyond those we currently have in clinical development.
+Added: Our future operating results are dependent in part on our ability to successfully discover, develop, obtain regulatory approval for and commercialize product candidates beyond zanidatamab and the product candidates we currently have in clinical and preclinical development.
A product candidate can unexpectedly fail at any stage of preclinical and clinical development.
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The results from preclinical testing or early clinical trials of a product candidate may not be predictive of the results that will be obtained in later stage clinical trials of the product candidate.
−Removed: The success of other product candidates we may develop will depend on many factors, including the following:
−Removed: • generating sufficient data to support the initiation or continuation of clinical trials;
−Removed: • obtaining regulatory permission to initiate clinical trials;
−Removed: • contracting with the necessary parties to conduct clinical trials;
−Removed: • successful enrollment of patients in, and the completion of, clinical trials on a timely basis;
−Removed: • the timely manufacture of sufficient quantities of the product candidate for use in clinical trials;
−Removed: • adverse events in the clinical trials.
+Added: The success of other product candidates we may develop will depend on many factors, including generating sufficient data to support the initiation or continuation of clinical trials and obtaining regulatory permission to initiate clinical trials.
Even if we successfully advance any other product candidates into clinical development, their success will be subject to all of the clinical, regulatory and commercial risks described elsewhere in this “Risk Factors” section.
−Removed: Accordingly, we cannot assure you that we will ever be able to discover, develop, obtain regulatory approval of, commercialize or generate significant revenue from our other product candidates.
−Removed: If we, or any of our partners, are unable to enroll patients in clinical trials, we will be unable to complete these trials on a timely basis or at all.
+Added: We cannot assure you that we will ever be able to discover, develop, obtain regulatory approval of, commercialize or generate significant revenue from our other product candidates.
+Added: If we, or any of our strategic partners, are unable to enroll patients in clinical trials, we will be unable to complete these trials on a timely basis or at all.
Patient enrollment, a significant factor in the timing of clinical trials, is affected by many factors including the size and nature of the patient population, the proximity of subjects to clinical sites, the eligibility criteria for the trial, the design of the clinical trial, ability to obtain and maintain patient consents, risk that enrolled subjects will drop out before completion, competing clinical trials and clinicians’ and patients’ perceptions as to the potential advantages of the drug being studied in relation to other available therapies, including any new drugs that may be approved for the indications we are investigating.
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If we, or any of our strategic partners that perform clinical tests for our product candidates, are unable to enroll a sufficient number of patients to complete clinical testing, we will be unable to gain marketing approval for such product candidates and our business will be harmed.
+Added: Additionally, projections of addressable patient populations that have the potential to benefit from treatment with our or our strategic partners’ product candidates are based on estimates, and, if such estimates are inaccurate, could have an adverse material impact on our business.
In addition, the U.S.
−Removed: federal Right to Try Act, among other things, provides a federal framework for patients to access certain investigational new drug products that have completed a Phase 1 clinical trial.
+Added: federal Right to Try Act, among other things, provides a framework for patients to access certain investigational new drug products that have completed a Phase 1 clinical trial.
Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA approval under the FDA expanded access program.
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The FDA or other non-U.S.
−Removed: regulatory authorities may disagree with our trial design and our interpretation of data from preclinical studies and clinical trials.
+Added: regulatory authorities may disagree with our trial design and our interpretation of data from preclinical studies
+Added: and clinical trials.
In addition, any of these regulatory authorities may change requirements for the approval of a product candidate even after reviewing and providing comments or advice on a protocol for a pivotal Phase 3 clinical trial that has the potential to result in FDA or other agencies’ approval.
−Removed: In addition, any of these regulatory authorities may also approve a product candidate for fewer or more limited indications than we request or may grant approval contingent on the performance of costly post-marketing clinical trials.
+Added: In addition, any of these regulatory authorities may approve a product candidate for fewer or more limited indications than we request or may grant approval contingent on the performance of costly post-marketing clinical trials.
The FDA or other non-U.S.
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Adverse differences between interim, preliminary or top-line data and final data could significantly harm our reputation and business prospects.
−Removed: Moreover, preliminary, interim and top-line data are subject to the risk that one or more of the clinical outcomes may materially change as more patient data become available when patients mature on study, patient enrollment continues or as
−Removed: other ongoing or future clinical trials with a product candidate further develop.
+Added: Moreover, preliminary, interim and top-line data are subject to the risk that one or more of the clinical outcomes may materially change as more patient data become available when patients mature on study, patient enrollment continues or as other ongoing or future clinical trials with a product candidate further develop.
Past results of clinical trials may not be predictive of future results.
−Removed: In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically more extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure.
+Added: The information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically more extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure.
Any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities or otherwise regarding a particular product candidate or our business.
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Moreover, preclinical, nonclinical and clinical data are often susceptible to varying interpretations and analyses and many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials nonetheless failed to obtain FDA or other regulatory approval.
−Removed: The Fast Track and Breakthrough Therapy designations we have received for zanidatamab may not result in faster development, regulatory review or approval process.
+Added: The Fast Track and Breakthrough Therapy designations received for zanidatamab may not result in faster development, regulatory review or approval process.
The FDA has granted Fast Track designations to zanidatamab for the first-line treatment of patients with HER2-overexpressing GEA in combination with standard of care chemotherapy and for previously treated or recurrent gene-amplified BTC.
−Removed: These Fast Track designations do not ensure that zanidatamab will experience a faster development, regulatory review or approval process compared to conventional FDA procedures or that zanidatamab will ultimately obtain regulatory approval.
−Removed: Additionally, the FDA may withdraw Fast Track designation if it believes that the designation is no longer supported by data from the zanidatamab clinical development program.
−Removed: The FDA also granted Breakthrough Therapy designation for zanidatamab for treatment of patients with previously treated HER2 g ene-amplified locally advanced/unresectable or metastatic BTC.
−Removed: Although Jazz and we have met with the FDA to discuss the data readout from the HERIZON-BTC-01 study in support of submitting a BLA for zanidatamab in patients with previously treated HER2 gene-amplified BTC, the receipt of a Breakthrough Therapy designation for a product candidate may not ultimately result in a faster development process or review, and it does not in any way assure approval of a product candidate by the FDA.
−Removed: In addition, designation as a Breakthrough Therapy is within the discretion of the FDA and the FDA may decide to rescind a Breakthrough Therapy designation if it believes that a designated product candidate no longer meets the conditions for qualification of this program.
−Removed: If the zanidatamab clinical development program is suspended, terminated, or put on clinical hold due to unexpected adverse events or other issues, including clinical supply issues, the benefits associated with the Fast Track designation may not be realized by us or our strategic partners.
+Added: While the FDA granted accelerated approval in November 2024 for Ziihera ® for injection for intravenous use for the treatment of adults with previously treated, unresectable or metastatic HER2+ BTC (IHC 3+), these Fast Track designations do not ensure that zanidatamab will experience a faster development, regulatory review or approval process compared to conventional FDA procedures or that zanidatamab will ultimately obtain regulatory approval for additional indications.
+Added: The FDA may withdraw Fast Track designation if it believes that the designation is no longer supported by data from the zanidatamab clinical development program.
+Added: The FDA also granted Breakthrough Therapy designation for zanidatamab for treatment of patients with previously treated HER2 gene-amplified locally advanced/unresectable or metastatic BTC.
+Added: Designation as a Breakthrough Therapy is within the discretion of the FDA and the FDA may decide to rescind a Breakthrough Therapy designation if it believes that a designated product candidate no longer meets the conditions for qualification of this program.
+Added: If a clinical development program is suspended, terminated, or put on clinical hold due to unexpected adverse events or other issues, including clinical supply issues, the benefits associated with the Fast Track or Breakthrough Therapy designations may not be realized by us or our strategic partners.
Furthermore, Fast Track designation does not change the standards for approval, and the designation alone does not guarantee qualification for the FDA’s priority review procedures.
−Removed: Zanidatamab has also been granted Breakthrough Therapy designation from the Center for Drug Evaluation in China for treating patients with BTC who have failed prior systemic therapies.
+Added: Zanidatamab has also been granted Breakthrough Therapy designation from the CDE in China for treating patients with BTC who have failed prior systemic therapies.
This designation alone does not guarantee faster approval of zanidatamab in China.
Development of product candidates in combination with other therapies could expose us to additional risks.
−Removed: Even if any of our product candidates were to receive marketing approval or be commercialized for use in combination with other existing therapies, we would continue to be subject to the risks that the FDA, the European Medicines Agency (“ EMA ”) or other comparable foreign regulatory authorities could revoke approval of the therapy used in combination with any of our product candidates, or safety, efficacy, manufacturing or supply issues could arise with these existing therapies.
−Removed: In addition, it is possible that existing therapies with which our product candidates are approved for use could themselves fall out of favor or be relegated to later lines of treatment.
−Removed: This could result in the need to identify other combination therapies for our product candidates or our own products being removed from the market or being less successful commercially.
−Removed: We may also evaluate our product candidates in combination with one or more other cancer therapies that have not yet been approved for marketing by the FDA, EMA or comparable foreign regulatory authorities.
−Removed: We will not be able to market and sell any product candidate in combination with any such unapproved cancer therapies that do not ultimately obtain marketing approval.
−Removed: If the FDA, EMA or other comparable foreign regulatory authorities do not approve or revoke their approval of these other therapies, or if safety, efficacy, commercial adoption, manufacturing or supply issues arise with the therapies we choose to evaluate in combination
−Removed: with any other product candidate, we may be unable to obtain approval of or successfully market any one or all of the product candidates we develop.
−Removed: Additionally, if the third-party providers of therapies or therapies in development used in combination with our product candidates are unable to produce sufficient quantities for clinical trials or for commercialization of our product candidates, or if the cost of combination therapies are prohibitive, our development and commercialization efforts would be impaired, which would have an adverse effect on our business, financial condition, results of operations and growth prospects.
−Removed: Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified product candidates from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business.
+Added: We are subject to risks that the FDA, the EMA or other comparable foreign regulatory authorities could revoke approval of any therapies used in combination with zanidatamab or any other product candidate that receives marketing approval.
+Added: We are also subject to the risk that safety, efficacy, manufacturing or supply issues could arise with such therapies.
+Added: In addition, it is possible that existing therapies with which zanidatamab or our product candidates are approved for use could themselves fall out of favor or be relegated to later lines of treatment, which could result in such products being removed from the market or being less successful commercially.
+Added: We may also evaluate our product candidates in combination with one or more other therapies that have not yet been approved for marketing by the FDA, EMA or comparable foreign regulatory authorities.
+Added: We will not be able to market and sell any product candidate in combination with any such unapproved therapies that do not ultimately obtain marketing approval.
+Added: If the FDA, EMA or other comparable foreign regulatory authorities do not approve or revoke their approval of these other therapies, or if safety, efficacy, commercial adoption, manufacturing or supply issues arise with the therapies we choose to evaluate in combination with any other product candidate, we may be unable to obtain approval of or successfully market any one or all of the product candidates we develop.
+Added: Additionally, if the third-party providers of therapies or therapies in development used in combination with zanidatamab or our product candidates are unable to produce sufficient quantities for clinical trials or for commercialization of our product candidates, or if the cost of combination therapies is prohibitive, our development and commercialization efforts would be impaired, which would have an adverse effect on our business, financial condition, results of operations and growth prospects.
+Added: If we are unable to successfully develop any required companion diagnostic tests for our product candidates, or experience significant delays in doing so, or rely on third parties in the development of such companion diagnostic tests, we may not realize the full commercial potential of our product candidates.
+Added: If we develop a product candidate for which there are no commercially available diagnostic tests for identifying the appropriate patient population to ensure safe and effective use of such candidate, the FDA may require us to develop a companion diagnostic plan in conjunction with clinical development and regulatory approval for our product candidate.
+Added: Lack of a reliable commercially available companion diagnostic can introduce uncertainties in the regulatory process for our product candidate.
+Added: Developing a companion diagnostic or working with a third party to develop such companion diagnostic for our product candidate will require more resources and could expose us to additional liabilities related to government regulation of companion diagnostics.
+Added: If the FDA expects to review and approve simultaneously marketing submissions for a therapeutic candidate and its companion diagnostic, any delay in diagnostic marketing clearance or approval could delay the drug approval.
+Added: In particular, in April 2020, the FDA issued guidance on developing and labeling companion diagnostics for a specific group of oncology therapeutic products, including recommendations to support a broader labeling claim rather than individual therapeutic products.
+Added: In June 2023, the FDA announced a voluntary pilot program through which drug manufacturers can provide to the FDA the diagnostic test performance information used to enroll patients into clinical trials for drug approval.
+Added: Based on assessment of the performance information, the FDA will publish the minimum performance characteristics recommended for similar tests that may be used to select patients for treatment with the approved drug to help laboratories identify specific biomarkers for their development of laboratory-developed tests (“LDTs”), and to ensure more consistent performance of these tests for drug selection and improved cancer patient care.
+Added: In May 2024, the FDA issued a final rule that phases out its enforcement discretion for most LDTs and amends the FDA’s regulations to make explicit that in vitro diagnostics are medical devices under the Federal Food, Drug, and Cosmetic Act, including when the manufacturer of the diagnostic product is a laboratory.
+Added: This final rule is subject to ongoing judicial challenges.
+Added: Changes in the leadership of the FDA and other federal agencies under the new Trump administration can result in changes in policies and new regulations that impact the regulation of LDTs and our companion diagnostic development plans.
+Added: We will continue to evaluate the impact of this rule on our companion diagnostic development and strategy.
+Added: Any future issuances from the FDA and other regulatory authorities, including changes in the FDA’s regulation of diagnostic tests and LDTs, may impact our development of a companion diagnostic for our product candidates and result in delays in regulatory approval.
+Added: We may be required to conduct additional studies to support a broader claim.
+Added: Also, to the extent other approved diagnostics are able to broaden their labeling claims to include our approved drug products, we may be forced to abandon any of our companion diagnostic development plans, or we may not be able to compete effectively upon approval, which could adversely impact our ability to generate revenue from the sale of approved products and our business operations.
+Added: We may rely on third parties for the design, development and manufacture of companion diagnostic tests for our product candidates that require such tests.
+Added: To be successful, we or our collaborators will need to address a number of scientific, technical, regulatory and logistical challenges.
+Added: If we or such third parties are unable to successfully develop companion diagnostics, or experience delays in doing so, we may be unable to enroll enough patients for our current and planned clinical
+Added: trials, the development of our product candidates may be adversely affected or we may not obtain marketing approval, and we may not realize the full commercial potential of our product candidates.
+Added: Disruptions at the FDA and other government agencies caused by funding shortages, reductions in staff or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified product candidates from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business.
The ability of the FDA to review and clear or approve new product candidates can be affected by a variety of factors, including government budget and funding levels, statutory, regulatory, and policy changes, the FDA’s ability to hire and retain key personnel and accept the payment of user fees, and other events that may otherwise affect the FDA’s ability to perform routine functions.
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Disruptions at the FDA and other agencies, including delays or disruptions due to pandemics or other health crises, travel restrictions, staffing shortages, government shutdowns and furloughs, may also slow the time necessary for new product candidates to be reviewed and/or approved by necessary government agencies, which would adversely affect our business.
+Added: Additionally, the current Presidential administration is pursuing significant reductions in the number of federal employees across numerous agencies.
+Added: A significant reduction in the number of FDA personnel as a result of this initiative could materially impact review timelines and negatively and adversely impact our business.
Successful development of our current and future product candidates is uncertain and we may discontinue or reprioritize the development of any of our product candidates at any time, at our discretion.
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Alternatively, management may elect to discontinue development of certain product candidates to accommodate a shift in corporate strategy, despite positive clinical results.
−Removed: Based on our operating results and business strategy, among other factors, we may discontinue the development of any of our product candidates under development or reprioritize our focus on other product candidates at any time and at our discretion.
−Removed: Additionally, because we have limited financial and managerial resources, we focus on research programs, therapeutic platforms and product candidates that we identify for specific indications.
+Added: Based on our operating results and business strategy, among other factors, we may discontinue the development of any of our other product candidates under development or reprioritize our focus on other product candidates at any time and at our discretion.
+Added: Because we have limited financial and managerial resources, we focus on research programs, therapeutic platforms and product candidates that we identify for specific indications.
As a result, we may forgo or delay pursuit of opportunities with other therapeutic platforms or product candidates or for other indications that later prove to have greater commercial potential.
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Our product candidates may have undesirable side effects that may delay or prevent marketing approval or, if approval is received, require them to be taken off the market, require them to include safety warnings or otherwise limit their sales.
−Removed: no regulatory agency has made any determination that any of our product candidates are safe or effective for use by the general public for any indication.
−Removed: All of our product candidates are still in preclinical or clinical development.
−Removed: Consequently, all of our product candidates are required to undergo ongoing safety testing in humans as part of clinical trials.
Unforeseen side effects from any of our product candidates could arise either during clinical development or, if approved by regulatory authorities, after the approved product has been marketed.
−Removed: Zanidatamab and zanidatamab zovodotin continue to be evaluated in clinical trials, and the results of these and future clinical trials may show that zanidatamab, zanidatamab zovodotin or our other product candidates cause undesirable or unacceptable side effects, which could interrupt, delay or halt clinical trials, and result in delay of, or failure to obtain, marketing approval from the FDA and other regulatory authorities, or result in marketing approval from the FDA and other regulatory authorities with restrictive label warnings, limited patient populations or potential product liability claims.
−Removed: we believe that our clinical trials and preclinical studies demonstrate the safety and efficacy of our product candidates, only the FDA and other comparable regulatory agencies may ultimately make such determination.
−Removed: No regulatory agency has made any such determination that any of our product candidates are safe or effective for use by the general public for any indication.
−Removed: If any of our product candidates receive marketing approval and we or others later identify undesirable or unacceptable side effects caused by such products:
−Removed: • regulatory authorities may require us to take our approved product off the market;
+Added: As our product candidates are evaluated in clinical trials, the results of such clinical trials may show that our product candidates cause undesirable or unacceptable side effects, which could interrupt, delay or halt clinical trials, and result in delay of, or failure to obtain, marketing approval from the FDA and other regulatory authorities, or result in marketing approval from the FDA and other regulatory authorities with restrictive label warnings, limited patient populations or potential product liability claims.
+Added: Even if we believe that our clinical trials and preclinical studies demonstrate the safety and efficacy of our product candidates, only the FDA and other comparable regulatory agencies may ultimately make such determination.
+Added: If we or others later identify undesirable or unacceptable side effects caused by zanidatamab or other product candidates that receive marketing approval:
+Added: • regulatory authorities may require the approved product to be taken off the market;
• regulatory authorities may require the addition of labeling statements, specific warnings, a contraindication or field alerts to physicians and pharmacies, or impose a risk evaluation and mitigation strategy that includes restrictions and conditions on product distribution, prescribing and/or dispensing;
−Removed: • we may be required to change the way the product is administered, conduct additional clinical trials or change the labeling of the product;
−Removed: • we may be subject to limitations on how we may promote the product;
+Added: • we or our partners may be required to change the way the product is administered, conduct additional clinical trials or change the labeling of the product;
+Added: • we or our partners may be subject to limitations on how we may promote the product;
• sales of the product may decrease significantly;
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Any of these events could prevent us or our current or future strategic partners from achieving or maintaining market acceptance of the affected product or could substantially increase commercialization costs and expenses, which in turn could delay or prevent us from generating revenue from the sale of any future products.
−Removed: We face significant competition, and if our competitors develop and market products that are more effective, safer or less expensive than our product candidates, our commercial opportunities will be negatively impacted.
+Added: We face significant competition, and if our competitors develop and market products that are more effective, safer and/or less expensive than our product candidates, our commercial opportunities will be negatively impacted.
The life sciences industry is highly competitive and subject to rapid and significant technological change.
−Removed: We are currently developing biotherapeutics that will compete with other drugs and therapies that currently exist or are being developed.
+Added: We are developing biotherapeutics that will compete with other drugs and therapies that currently exist or are being developed.
Products we may develop in the future are also likely to face competition from other drugs and therapies, some of which we may not currently be aware.
−Removed: We have competitors both in the United States and internationally, including major multinational pharmaceutical companies, established biotechnology companies, specialty pharmaceutical companies, universities and other research institutions.
+Added: We have competitors in the United States and internationally, including major multinational pharmaceutical companies, established biotechnology companies, specialty pharmaceutical companies, universities and other research institutions.
Many of our competitors have significantly greater financial, manufacturing, marketing, drug development, technical and human resources than we do.
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As a result of all of these factors, our competitors may succeed in obtaining patent protection or FDA approval or discovering, developing and commercializing products in our field before we do.
−Removed: Specifically, there are a large number of companies developing or marketing treatments for cancer, including many major pharmaceutical and biotechnology companies.
−Removed: These treatments consist both of small-molecule drug products, as well as biologics that work by using various antibody therapeutic platforms to address specific cancer targets.
+Added: Specifically, there are a large number of companies developing or marketing treatments for cancer and AIID, including many major pharmaceutical and biotechnology companies.
+Added: These treatments consist both of small-molecule drug products, as well as biologics that work by using various antibody therapeutic platforms to address specific targets.
Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, more convenient or less expensive than any products that we may develop.
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Technological advances or products developed by our competitors may render our technologies or product candidates obsolete, less competitive or not economical.
−Removed: In addition, we expect to compete with biosimilar versions of already approved products, and even if our product candidates achieve marketing approval, they may be challenged to achieve a price premium over competitive biosimilar products and will compete for market share with them.
+Added: We expect to compete with biosimilar versions of already approved products, and even if additional product candidates achieve marketing approval, they may be challenged to achieve a price premium over competitive biosimilar products and will compete for market share with them.
The Biologics Price Competition and Innovation Act of 2009, which is included in the 2010 Patient Protection and Affordable Care Act (“ PPACA ”) , authorized the FDA to approve similar versions of innovative biologics, commonly known as biosimilars.
−Removed: Under the PPACA, a manufacturer may submit an application for licensure of a biologic product that is “biosimilar to” or “interchangeable with” a previously approved biologic product or “reference product.” Manufacturers may not submit an application for a biosimilar to the FDA until four years following approval of the reference product, and the FDA may not approve a biosimilar product until 12 years from the date on which the reference product was approved.
+Added: Under the PPACA, a manufacturer may submit an application for licensure of a biologic product that is “biosimilar to” or “interchangeable with” a previously approved biologic product or “reference product.” Manufacturers may not submit an
+Added: application for a biosimilar to the FDA until four years following approval of the reference product, and the FDA may not approve a biosimilar product until 12 years from the date on which the reference product was approved.
Even if our product candidates, if approved, are deemed to be reference products eligible for exclusivity, another company could market a competing version of that product if the FDA approves a full BLA for such product containing the sponsor’s own preclinical data and data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of their product.
Additionally, from time to time, there are proposals to repeal or modify the PPACA, including proposals that could significantly shorten the exclusivity period for biologics.
−Removed: If any of our product candidates receive regulatory approval, the approved products may not achieve broad market acceptance among physicians, patients, the medical community and third-party payors, in which case revenue generated from their sales would be limited.
−Removed: The commercial success of our product candidates will depend upon their acceptance among physicians, patients and the medical community.
−Removed: The degree of market acceptance of our product candidates will depend on a number of factors, including:
−Removed: • limitations or warnings contained in the approved labeling for a product candidate;
−Removed: • changes in the standard of care for the targeted indications for any of our product candidates;
−Removed: • limitations in the approved clinical indications for our product candidates;
+Added: If zanidatamab or any of our product candidates that receives regulatory approval in the future does not achieve broad market acceptance among physicians, patients, the medical community and third-party payors, revenue generated from royalties or sales would be limited.
+Added: The commercial success of zanidatamab or our product candidates will depend upon their acceptance among physicians, patients and the medical community.
+Added: The degree of market acceptance of zanidatamab or our product candidates will depend on a number of factors, including:
+Added: • limitations or warnings contained in the approved labeling;
+Added: • changes in the standard of care for the targeted indications;
+Added: • limitations in the approved clinical indications;
• demonstrated clinical safety and efficacy compared to other products;
• sales, marketing and distribution support;
−Removed: • availability of coverage and extent of reimbursement from managed care plans and other third-party payors;
+Added: • availability of coverage and the extent of access and reimbursement from managed care plans and other third-party payors;
• timing of market introduction and perceived effectiveness of competitive products;
−Removed: • availability of alternative therapies at similar or lower cost, including generic, biosimilar and over-the-counter products;
−Removed: • the extent to which the product candidate is approved for inclusion on formularies of hospitals and managed care organizations;
+Added: • availability of alternative therapies at similar or lower cost;
+Added: • the extent to which the product is approved for inclusion on formularies of hospitals and managed care organizations;
• whether the product is designated under physician treatment guidelines as a first-line therapy or as a second- or third-line therapy for particular diseases;
• whether the product can be used effectively with other therapies to achieve higher response rates;
−Removed: • adverse publicity about our product candidates or favorable publicity about competitive products;
−Removed: • convenience and ease of administration of our products;
+Added: • adverse publicity about the product or favorable publicity about competitive products;
+Added: • convenience and ease of administration of the product;
• potential product liability claims.
−Removed: If any of our product candidates are approved, but do not achieve an adequate level of acceptance by physicians, patients and the medical community, we may not generate sufficient revenue from these products, and we may not become or remain profitable.
−Removed: In addition, efforts to educate the medical community and third-party payors on the benefits of our product candidates may require significant resources and may never be successful.
+Added: If zanidatamab or any of our product candidates that are approved in the future do not achieve an adequate level of acceptance by physicians, patients and the medical community, we may not generate sufficient revenue from these products, and we may not become or remain profitable.
+Added: In addition, efforts to educate the medical community and third-party payors on the benefits of zanidatamab or our product candidates may require significant resources and may never be successful.
We or our strategic partners may be unable to obtain orphan drug exclusivity in specific indications for zanidatamab or in future product candidates that we may develop.
If our competitors are able to obtain orphan product exclusivity for their products in specific indications, we may not be able to have competing products approved in those indications by the applicable regulatory authority for a significant period of time.
−Removed: The FDA has granted Orphan Drug Designation to zanidatamab for the treatment of BTC and gastric cancer, including cancer of the gastroesophageal junction, the EMA has granted Orphan Drug Designation to zanidatamab for the treatment of gastric
−Removed: cancer and BTC, and we or our strategic partners may seek Orphan Drug Designation for zanidatamab or other product candidates for additional indications in the future.
+Added: The FDA has granted Orphan Drug Designation to zanidatamab for the treatment of BTC and gastric cancer, including cancer of the gastroesophageal junction, the EMA has granted Orphan Drug Designation to zanidatamab for the treatment of gastric cancer and BTC, and we or our strategic partners may seek Orphan Drug Designation for zanidatamab or other product candidates for additional indications in the future.
Orphan Drug Designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.
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2021), the court disagreed with the FDA’s longstanding position that the orphan drug exclusivity only applies to the approved use or indication within an eligible disease, and not to all uses or indications within the entire disease or condition.
−Removed: On January 24, 2023, the FDA published a notice in the Federal Register to clarify that while the agency complies with the court’s order in Catalyst, the FDA intends to continue to apply its longstanding interpretation of the regulations to matters outside of the scope of the Catalyst order – that is, the agency will continue tying the scope of orphan drug exclusivity to the uses or indications for which a drug is approved, which permits other sponsors to obtain approval of a drug for new uses or indications within the same orphan designated disease or condition that have not yet been approved.
+Added: In January 2023, the FDA published a notice in the Federal Register to clarify that while the agency complies with the court’s order in Catalyst, the FDA intends to continue to apply its longstanding interpretation of the regulations to matters outside of the scope of the Catalyst order – that is, the agency will continue tying the scope of orphan drug exclusivity to the uses or indications for which a drug is approved, which permits other sponsors to obtain approval of a drug for new uses or indications within the same orphan designated disease or condition that have not yet been approved.
+Added: The U.S Supreme Court’s recent Chevron decision may invite lawsuits against the FDA to challenge longstanding decisions and policies of the FDA, including the FDA’s statutory interpretations of market exclusivities, which could undermine the FDA’s authority, lead to uncertainty in the industry, and disrupt the FDA’s normal operations.
+Added: Further, the Trump administration, along with new leadership at the FDA, may issue new policies and regulations.
+Added: Executive actions under the Trump administration, such as layoffs, a hiring freeze and budget cuts, may also disrupt the normal operations of federal agencies.
It is unclear how future litigation, legislation, agency decisions, and administrative actions will impact the scope of the orphan drug exclusivity.
−Removed: Even if we obtain FDA approval of any of our product candidates, we may never obtain approval or commercialize such products outside of the United States, which would limit our ability to realize their full market potential.
+Added: Even if we obtain FDA approval of any of our product candidates, we may never obtain approval or commercialize such product candidates outside of the United States, which would limit our ability to realize their full market potential.
In order to market any products outside of the United States, we must establish and comply with numerous and varying regulatory requirements of other countries regarding safety and efficacy.
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Approval procedures vary among countries and can involve additional product testing and validation and additional administrative review periods.
−Removed: Seeking foreign regulatory approvals could result in significant delays, difficulties and costs for us and may require additional preclinical studies or clinical trials, which would be costly and time consuming.
+Added: Seeking foreign regulatory approvals could result in significant delays, difficulties and costs and may require additional preclinical studies or clinical trials, which would be costly and time consuming.
Regulatory requirements can vary widely from country to country and region to region and could delay or prevent the introduction of our products in those countries.
Satisfying these and other regulatory requirements is costly, time consuming, uncertain and subject to unanticipated delays.
−Removed: In addition, our failure to obtain regulatory approval in any country may delay or have negative effects on the process for regulatory approval in other countries.
−Removed: We do not have any product candidates approved for sale in any jurisdiction, including international markets, and we do not have experience in obtaining regulatory approval in international markets.
+Added: Our failure to obtain regulatory approval in any country may delay or have negative effects on the process for regulatory approval in other countries.
+Added: Zanidatamab is the only product developed using our therapeutic platforms to have received FDA approval, and as of the date of this report, no approvals in international markets have been obtained.
+Added: Such approval was received by our strategic partner Jazz, and we do not have experience in obtaining regulatory approval in the United States or international markets.
If we fail to comply with regulatory requirements in international markets or to obtain and maintain required approvals, our target market will be reduced and our ability to realize the full market potential of our products will be harmed.
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• successful completion of preclinical studies;
−Removed: • submission of IND or foreign equivalent applications, or other regulatory applications, for our planned clinical trials or future clinical trials and authorizations from regulators to initiate clinical studies;
+Added: • submission of IND and non-U.S.
+Added: applications, or other regulatory applications, for our planned clinical trials or future clinical trials and authorizations from regulators to initiate clinical studies;
• successful enrollment in, and completion of, clinical trials;
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• receipt of marketing approvals from applicable regulatory authorities;
−Removed: • establishing and maintaining sufficient manufacturing capabilities, whether internally or with third parties, for clinical and commercial supply;
+Added: • establishing and maintaining sufficient manufacturing capabilities, for clinical and commercial supply;
• obtaining pricing, reimbursement, and hospital formulary access;
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If we do not achieve one or more of these requirements in a timely manner, we could experience significant delays or an inability to successfully commercialize our product candidates, which would materially harm our business.
−Removed: We cannot be certain that our clinical trials will be initiated and completed on time, if at all, or whether our planned clinical strategy will be acceptable to the FDA or foreign health authorities.
To become and remain profitable, we must develop, obtain approval for and eventually commercialize products, if approved, that generate significant revenue.
−Removed: In addition, it is not uncommon for product candidates to exhibit unforeseen safety issues or inadequate efficacy when tested in humans despite promising results in preclinical animal models or earlier trials, and we may ultimately be unable to demonstrate adequate safety and efficacy of our product candidates to obtain marketing approval.
Even if we obtain approval and begin commercializing one or more of our product candidates, we may never generate revenue that is significant or large enough to achieve profitability.
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As a result, we might obtain regulatory approval for a product in a particular country, but then be subject to price regulations that delay our commercial launch of the product and negatively impact the revenues we are able to generate from the sale of the product in that country.
+Added: In many countries, particularly those in the EU, prescription drug pricing and reimbursement is subject to governmental control.
+Added: In those countries that impose price controls, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product.
+Added: To obtain reimbursement or pricing approval in some countries, we or our strategic partners may be required to conduct a clinical trial that compares the cost-effectiveness of our product candidates to other available therapies.
Our ability to commercialize any products successfully also will depend in part on the extent to which coverage and adequate reimbursement for these products and related treatments will be available from government health administration authorities, private health insurers and other third-party payors.
−Removed: In many jurisdictions, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction.
Obtaining coverage and reimbursement approval of a product from a government or other third-party payor is a time-consuming and costly process that could require us to provide to the payor supporting scientific, clinical and cost-effectiveness data for the use of our products.
If we are not currently capturing the scientific and clinical data that will be required for reimbursement approval, we may be required to conduct additional trials, which may delay or suspend reimbursement approval.
−Removed: Additionally, in the United States, no uniform policy of coverage and reimbursement for products exists among third-party payors.
+Added: In the United States, no uniform policy of coverage and reimbursement for products exists among third-party payors.
Therefore, coverage and reimbursement for products can differ significantly from payor to payor.
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Even if our product candidates are approved for sale by the appropriate regulatory authorities, market acceptance and sales of these products will depend on reimbursement policies and may be affected by future healthcare reform measures.
−Removed: Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which drugs they will reimburse and establish payment levels.
+Added: Government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which drugs
+Added: they will reimburse and establish payment levels.
We cannot be certain that reimbursement will be available for any products that we develop.
−Removed: If reimbursement is not available or is available on a limited basis, we may not be able to successfully commercialize any of our approved products.
−Removed: In the United States, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, also called the Medicare Modernization Act (“MMA”), changed the way Medicare covers and pays for pharmaceutical products.
−Removed: The legislation established Medicare Part D, which expanded Medicare coverage for outpatient prescription drug purchases by the elderly but provided authority for limiting the number of drugs that will be covered in any therapeutic class.
−Removed: The MMA also introduced a new reimbursement methodology based on average sales prices for physician-administered drugs.
+Added: If reimbursement is not available or is available on a limited basis, we may not be able to successfully commercialize any approved products.
We expect to experience pricing pressures in connection with the sale of any products that we develop, due to the trend toward managed healthcare, the increasing influence of health maintenance organizations and additional legislative proposals.
In August 2022, Congress passed the Inflation Reduction Act of 2022, which includes prescription drug provisions that have significant implications for the pharmaceutical industry and Medicare beneficiaries, including allowing the federal government to negotiate a maximum fair price for certain high-priced single-source Medicare drugs, imposing penalties and excise tax for manufacturers that fail to comply with the drug price negotiation requirements, requiring inflation rebates for all Medicare Part B and Part D drugs, with limited exceptions, if their drug prices increase faster than inflation, and redesigning Medicare Part D to reduce out-of-pocket prescription drug costs for beneficiaries, among other changes.
−Removed: Various industry stakeholders, including pharmaceutical companies, the U.S.
−Removed: Chamber of Commerce, the National Infusion Center Association, the Global Colon Cancer Association, and the Pharmaceutical Research and Manufacturers of America, have initiated lawsuits against the federal government asserting that the price negotiation provisions of the Inflation Reduction Act are unconstitutional.
−Removed: The impact of these judicial challenges, legislative, executive, and administrative actions and any future healthcare measures and agency rules implemented by the government on us and the pharmaceutical industry as a whole is unclear.
+Added: Only high-expenditure single-source drugs that have been approved for at least seven years (11 years for single-source biologics) can qualify for negotiation, with the negotiated price taking effect two years after the selection year.
+Added: Various industry stakeholders have initiated lawsuits against the federal government asserting that the price negotiation provisions of the Inflation Reduction Act are unconstitutional.
+Added: The impact of these judicial challenges, future challenges in view of the U.S.
+Added: Supreme Court’s overruling of the Chevron doctrine, changes in the leadership of the federal agencies, legislative, executive, and administrative actions and any future healthcare measures and agency rules implemented by the government on us and the pharmaceutical industry as a whole is unclear.
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.
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Our or any collaborator’s inability to promptly obtain coverage and profitable payment rates from both government-funded and private payors for any approved products that we or our strategic partners develop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize product candidates and our overall financial condition.
−Removed: If the market opportunities for any product that we or our strategic partners develop are smaller than we believe they are, our revenue may be adversely affected and our business may suffer.
−Removed: We intend to initially focus our independent product candidate development on treatments for oncology.
−Removed: Our projections of addressable patient populations that have the potential to benefit from treatment with our product candidates are based on estimates.
−Removed: If our projections are inaccurate, the market opportunities for any of our product candidates could be significantly diminished and have an adverse material impact on our business.
We may not be successful in our efforts to use our therapeutic platforms to build a pipeline of product candidates.
We intend to use our therapeutic platforms to build a pipeline of product candidates and progress these product candidates through clinical development for the treatment of a variety of diseases.
−Removed: Although our research and development efforts as of the date of this report have resulted in a pipeline of product candidates directed at various cancers, we may not be able to develop product candidates that are safe and effective.
−Removed: In addition, although we expect that our therapeutic platforms will allow us to develop further product candidates, they may not prove to be successful at doing so.
+Added: Although our research and development efforts as of the date of this report have resulted in a pipeline of product candidates directed at various cancers and AIID, we may not be able to develop product candidates that are safe and effective.
+Added: Although we expect that our therapeutic platforms will allow us to develop further product candidates, they may not prove to be successful at doing so.
Even if we are successful in continuing to build our pipeline, the potential product candidates that we identify may not be suitable for clinical development, including as a result of being shown to have harmful side effects or other characteristics that indicate that they are unlikely to be products that will receive marketing approval and achieve market acceptance.
−Removed: If we do not continue to successfully develop and begin to
−Removed: commercialize product candidates, we will face difficulty in obtaining product revenue in future periods, which could result in significant harm to our financial position and adversely affect our stock price.
+Added: If we do not continue to successfully develop and begin to commercialize product candidates, we will face difficulty in obtaining product revenue in future periods, which could result in significant harm to our financial position and adversely affect our stock price.
Even if we receive regulatory approval to commercialize any of the product candidates that we develop, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense.
Any regulatory approvals that we receive for our product candidates may be subject to limitations on the approved indicated uses for which the product may be marketed or subject to certain conditions of approval, and may contain requirements for potentially costly post-approval trials, including Phase 4 clinical trials, and surveillance to monitor the safety and efficacy of the marketed product.
+Added: For example, in November 2024 the FDA granted accelerated approval for Ziihera® for the treatment of adults with previously treated, unresectable or metastatic HER2+ (IHC 3+) BTC.
+Added: However, continued approval for this indication may be contingent upon verification and description of clinical benefit in a confirmatory trial.
For any approved product, we will be subject to ongoing regulatory obligations and extensive oversight by regulatory authorities, including with respect to manufacturing processes, labeling, packaging, distribution, adverse event reporting, storage, advertising, promotion and recordkeeping for the product.
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Occurrence of any of the foregoing could have a material and adverse effect on our business and results of operations.
+Added: Our business also may be impacted by new policies and leadership at the FDA and other federal agencies under the new Presidential administration.
+Added: Such changes and transition to the Trump administration may delay our interactions and submissions with the FDA, our clinical development timeline, or result in increased compliance costs.
Further, the FDA’s or other ex-U.S.
regulators’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
−Removed: For example, i f the Supreme Court reverses or curtails the Chevron doctrine, which gives deference to regulatory agencies in litigation against FDA and other agencies, more companies may bring lawsuits against the FDA to challenge longstanding decisions and policies of the FDA, which could undermine the FDA’s authority, lead to uncertainties in the industry, and disrupt the FDA’s normal operations, which could delay the FDA’s review of our marketing applications.
+Added: We also cannot predict the full impact of the U.S.
+Added: Supreme Court's recent decision overruling the Chevron doctrine, future judicial challenges brought against the FDA, or the nature or extent of government regulation that may arise from future legislation or administrative action.
If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.
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In particular, a drug product may not be promoted by manufacturers for uses that are not approved by the FDA, as reflected in the FDA-approved labeling, although healthcare professionals are permitted to use drug products for off-label uses.
−Removed: The FDA, the Department of Justice, the Inspector General of the Department of Health and Human Services, among other government agencies, actively enforce the laws and regulations prohibiting manufacturers’ promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability, including large civil and criminal fines, penalties, and enforcement actions.
+Added: The FDA, among other government agencies, actively enforce the laws and regulations prohibiting manufacturers’ promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability, including large civil and criminal fines, penalties, and enforcement actions.
The FDA has also imposed consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed for companies that engaged in such prohibited activities.
−Removed: If we cannot successfully manage the promotion of our approved product candidates, we could become subject to significant liability, which would materially adversely affect our business and financial condition.
−Removed: If any product liability lawsuits are successfully brought against us or any of our strategic partners, we may incur substantial liabilities and may be required to limit commercialization of our product candidates.
−Removed: We face an inherent risk of product liability lawsuits related to the testing of our product candidates in seriously ill patients, and will face an even greater risk if product candidates are approved by regulatory authorities and introduced commercially.
−Removed: Product liability claims may be brought against us or our strategic partners by participants enrolled in our clinical trials, patients, health care providers or others using, administering or selling any of our future approved products.
−Removed: If we cannot successfully defend
−Removed: ourselves against any such claims, we may incur substantial liabilities.
+Added: If we cannot successfully manage the promotion of any approved product candidates, we could become subject to significant liability, which would materially adversely affect our business and financial condition.
+Added: If any product liability lawsuits are successfully brought against us or any of our strategic partners, we may incur substantial liabilities and commercialization efforts of zanidatamab or our product candidates may need to be limited.
+Added: We face an inherent risk of product liability lawsuits related to the testing of our product candidates in seriously ill patients, and face an even greater risk as a result of commercialization of any approved product candidates.
+Added: Product liability claims may be brought against us or our strategic partners by participants enrolled in our clinical trials, patients, health care providers or others using, administering or selling any of our current or future approved products.
+Added: If we cannot successfully defend ourselves against any such claims, we may incur substantial liabilities.
Regardless of their merit or eventual outcome, liability claims may result in:
−Removed: • decreased demand for any future approved products;
+Added: • decreased demand for any current or future approved products;
• injury to our reputation;
+Added: • limitations placed on our promotional activities;
• withdrawal of clinical trial participants;
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• diversion of management and scientific resources from our business operations;
−Removed: • the inability to commercialize our product candidates.
−Removed: We may need to have in place increased product liability coverage when we begin the commercialization of our product candidates.
−Removed: Insurance coverage is becoming increasingly expensive.
−Removed: As a result, we may be unable to maintain or obtain sufficient insurance at a reasonable cost to protect us against losses that could have a material adverse effect on our business.
+Added: • the inability to commercialize approved products.
+Added: We may need to have in place increased product liability coverage when we begin the commercialization of any product candidates.
+Added: Insurance coverage is becoming increasingly expensive and we may be unable to maintain or obtain sufficient insurance at a reasonable cost to protect us against losses that could have a material adverse effect on our business.
A successful product liability claim or series of claims brought against us, particularly if judgments exceed any insurance coverage we may have, could decrease our cash resources and adversely affect our business, financial condition and results of operation.
−Removed: Patients with cancer and other diseases targeted by our product candidates are often already in severe and advanced stages of disease and have both known and unknown significant pre-existing and potentially life-threatening health risks.
−Removed: During the course of treatment, patients may suffer adverse events, including death, for reasons that may be related to our product candidates.
−Removed: Such events could subject us to costly litigation, require us to pay substantial amounts of money to injured patients, delay, negatively impact or end our opportunity to receive or maintain regulatory approval to market our product candidates, or require us to suspend or abandon our commercialization efforts.
−Removed: Even in a circumstance in which we do not believe that an adverse event is related to our product candidates, the investigation into the circumstance may be time-consuming or inconclusive.
−Removed: These investigations may interrupt our sales efforts, delay our regulatory approval process in other countries, or impact and limit the type of regulatory approvals our product candidates receive or maintain.
+Added: Patients with cancer and other diseases targeted by zanidatamab and our product candidates are often already in severe and advanced stages of disease and have both known and unknown significant pre-existing and potentially life-threatening health risks.
+Added: During the course of treatment, patients may suffer adverse events, including death, for reasons that may be related to zanidatamab or our product candidates.
+Added: Such events could subject us to costly litigation, require us to pay substantial amounts of money to injured patients, delay, negatively impact or end the opportunity to receive or maintain regulatory approval to market zanidatamab or our product candidates, or require us or our strategic partners to suspend or abandon commercialization efforts.
+Added: Even in circumstances in which we do not believe that an adverse event is related to zanidatamab or our product candidates, the investigation into the circumstance may be time-consuming or inconclusive.
+Added: These investigations may interrupt our sales efforts, delay our regulatory approval process in other countries, or impact and limit the type of regulatory approvals zanidatamab or our product candidates receive or maintain.
As a result of these factors, a product liability claim, even if successfully defended, could have a material adverse effect on our business, financial condition or results of operations.
−Removed: If we or any of our third-party manufacturers encounter manufacturing difficulties, our ability to provide supply of our product candidates for clinical trials or our products for patients, if approved, could be delayed or prevented.
+Added: If we, our strategic partners or any of our third-party manufacturers encounter manufacturing difficulties, our ability to provide supply of our product candidates for clinical trials or any approved products for patients could be delayed or prevented.
The manufacture of biological drug products is complex and requires significant expertise and capital investment, including the development of advanced manufacturing techniques, process and quality controls.
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These problems include logistics and shipping, difficulties with production costs and yields, quality control, including consistency, stability, purity and efficacy of the product, product testing, operator error and availability of qualified personnel, as well as compliance with applicable federal, state and foreign regulations.
−Removed: If contaminants are discovered in our supply of our product candidates or in the manufacturing facilities, such manufacturing facilities may need to be closed for an extended period of time to investigate and remedy the contamination.
−Removed: We cannot assure you that any stability, purity, and efficacy failures, deficiencies, or other issues relating to the manufacture of our product candidates will not occur in the future.
+Added: If contaminants are discovered in the supply of our products or product candidates or in the manufacturing facilities, such manufacturing facilities may need to be closed for an extended period of time to investigate and remedy the contamination.
+Added: We cannot assure you that any stability, purity, and efficacy failures, deficiencies, or other issues relating to the manufacture of our products or product candidates will not occur in the future.
+Added: Even if any of our product candidates is approved, these manufacturing difficulties and supply chain risks will persist and an inability to source sufficient commercial supply would materially and negatively impact our commercialization efforts and financial results.
Our research and development activities also involve the controlled use of potentially hazardous substances, including chemical and biological materials, by our third-party manufacturers.
While we currently outsource all manufacturing to third parties, we and our manufacturers are subject to federal, state and local laws and regulations governing the use, manufacture, storage, handling and disposal of medical and hazardous materials.
−Removed: Although we believe that our manufacturers’ procedures for using, handling, storing and disposing of these materials comply with legally prescribed standards, we cannot completely eliminate the risk of contamination or injury, and any related liability, resulting from medical or hazardous materials.
−Removed: Material modifications in methods of product candidate manufacturing or formulation may result in additional costs or delay.
−Removed: As product candidates are developed through preclinical to late-stage clinical trials towards approval and commercialization, it is common that various aspects of the development program, such as manufacturing methods and formulation, are altered along the way in an effort to optimize processes and results.
−Removed: Such changes carry the risk that they will not achieve these intended objectives.
−Removed: Any of these changes could cause our product candidates to perform differently and affect the results of planned clinical trials or other future clinical trials conducted with the altered materials.
−Removed: This could delay completion of clinical trials, require the conduct of bridging clinical trials or the repetition of one or more clinical trials, increase clinical trial costs, delay approval of our product candidates and jeopardize our ability, or our strategic partners’ ability, to commence product sales and generate revenue.
+Added: Although we believe that our manufacturers’ procedures relating to these laws comply with legally prescribed standards, we cannot completely eliminate the risk of contamination or injury, and any related liability, resulting from medical or hazardous materials.
+Added: In addition, manufacturing methods and formulation changes for product candidates advancing towards commercialization carry the risk that such product candidates may perform differently and affect the results of planned clinical trials or other future clinical trials conducted with the altered materials.
+Added: While such changes are common and intended to help optimize processes and results during the development process, any of these changes could increase costs, cause delays and impact our ability, or our strategic partners’ ability, to commence product sales and generate revenue.
Strategic transactions could disrupt our business, cause dilution to our stockholders and otherwise harm our business.
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Also, the anticipated benefit of any strategic transaction may not materialize or such strategic transaction may be prohibited.
−Removed: Additionally, future acquisitions or dispositions could result in potentially dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities or amortization expenses or write-offs of goodwill, any of which could harm our financial condition.
+Added: Any future acquisitions or dispositions could result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities or amortization expenses or write-offs of goodwill, any of which could harm our financial condition.
We cannot predict the number, timing or size of any future strategic alliances, joint ventures, investments, acquisitions, divestitures or other strategic transactions, or the effect that any such transactions might have on our operating results.
−Removed: Many governments impose strict price controls, which may adversely affect our future profitability.
−Removed: In many countries, particularly those in the European Union (“EU”), prescription drug pricing and reimbursement is subject to governmental control.
−Removed: In those countries that impose price controls, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product.
−Removed: To obtain reimbursement or pricing approval in some countries, we or our strategic partners may be required to conduct a clinical trial that compares the cost-effectiveness of our product candidates to other available therapies.
−Removed: Some countries require approval of the sale price of a drug before it can be marketed.
−Removed: In many countries, the pricing review period begins after marketing or product licensing approval is granted.
−Removed: In some markets, prescription pharmaceutical pricing remains subject to continuing governmental control even after initial approval is granted.
−Removed: As a result, we or our strategic partners might obtain marketing approval for a product candidate in a particular country, but then be subject to price regulations that delay commercial launch of the product candidate, possibly for lengthy time periods, and negatively impact the revenue that is generated from the sale of the product in that country.
−Removed: If reimbursement of such product candidates is unavailable or limited in scope or amount, if pricing is set at unsatisfactory levels, or if there is competition from lower priced cross-border sales, our profitability will be negatively affected.
Security breaches and incidents, loss of data and other disruptions could compromise sensitive information related to our business or protected health information or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.
In the ordinary course of our business, we and our CROs and other service providers collect, store and otherwise process petabytes of sensitive data, including legally protected health information, personal information, intellectual property and proprietary business information owned or controlled by ourselves or our strategic partners.
−Removed: We manage and maintain our applications and data by utilizing a combination of on-site systems, managed data center systems and cloud-based data center systems.
+Added: We manage and maintain our applications and data by using a combination of on-site systems, managed data center systems and cloud-based data center systems.
These applications and data encompass a wide variety of business-critical information, including research and development information, commercial information and business and financial information.
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loss of access risk, inappropriate disclosure risk, inappropriate modification risk and the risk of being unable to adequately monitor our controls over the first three risks.
−Removed: Although we take measures designed to protect sensitive information from unauthorized access or disclosure, our information technology and infrastructure and those that our CROs and our other third-party service providers may utilize in the past have been subject to, and may be vulnerable to, attacks by hackers or other third parties, viruses, ransomware or other malicious code, or other breaches, incidents, outages, interruptions, compromises or vulnerabilities due to inadvertent or intentional actions by our employees, contractors, business partners, and/or other third parties, or from cyber-attacks by malicious third parties (including supply chain cyber-attacks or the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of systems or information).
−Removed: The risks of these types of incidents and other matters occurring may be heightened in connection with geopolitical events such as the conflict between Russia and Ukraine.
−Removed: Any such breach, incident, outage, interruption, compromise or vulnerability could compromise systems and networks used in our business and lead to system and other operational outages, interruptions and disruptions and the loss, destruction, alteration, prevention of access to, disclosure, or dissemination of, or damage or unauthorized access to, our data (including trade secrets or other confidential information, intellectual property, proprietary business information, and personal information) or data that is processed or maintained on our behalf, or other assets, which could result in financial, legal, business and reputational harm to us.
+Added: Although we take measures designed to protect sensitive information from unauthorized access or disclosure, our information technology and infrastructure and those that our CROs and our other third-party service providers may use in the past have been subject to, and may be vulnerable to, attacks by hackers or other third parties, viruses, ransomware or other malicious code, or other breaches, incidents, outages, interruptions, compromises or vulnerabilities due to inadvertent or intentional actions by our employees, contractors, business partners, and/or other third parties, or from cyber-attacks by malicious third parties (including supply chain cyber-attacks or the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability and threaten the confidentiality, integrity and availability of systems or information).
+Added: The risks of these types of incidents and other matters occurring may be heightened in connection with geopolitical events.
+Added: Any such breach, incident, outage, interruption, compromise or vulnerability could compromise systems and networks used in our business and lead to system and other operational outages, interruptions and disruptions and the loss, destruction, alteration, prevention of access to, disclosure, or dissemination of, or damage or unauthorized access to, our data (including trade secrets or other confidential information, intellectual property, proprietary business information, and personal information) or data that is maintained or otherwise processed on our behalf, or other assets, which could result in financial, legal, business and reputational harm to us.
Any such event could result in legal claims, demands and litigation or governmental investigations or other proceedings, liability under laws that protect the privacy of personal information, such as the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), and regulatory penalties and other liabilities.
−Removed: Although we have implemented security measures and a formal enterprise security program designed to prevent unauthorized access to sensitive data, and make use of third-party service providers to perform certain operational and security functions on our behalf, there is no guarantee that we or our third-party service providers ca n, or have been able to, protect our systems or networks or other systems or networks used in our business from security breaches, incidents, outages, interruptions, compromises, or vulnerabilities, or that we or they have been or will be able to identify, identify the cause of or otherwise respond to any actual or potential security breach, incident, outages, interruptions, compromise or vulnerabilities.
+Added: Although we have implemented security measures and a formal enterprise security program designed to prevent unauthorized access to sensitive data, and make use of third-party service providers to perform certain operational and security functions on our behalf,
+Added: there is no guarantee that we or our third-party service providers ca n, or have been able to, protect our systems or networks or other systems or networks used in our business from security breaches, incidents, outages, interruptions, compromises, or vulnerabilities, or that we or they have been or will be able to identify, identify the cause of or otherwise respond to any actual or potential security breach, incident, outage, interruption, compromise or vulnerability.
We have engaged in efforts to improve our security measures, and we expect to continue to incur additional expenses in further efforts to do so, whether in response to actual or perceived security breaches or incidents, compromises, outages, interruptions, vulnerabilities or otherwise.
Any loss, destruction, alteration, prevention of access to, disclosure, or dissemination of, or damage or unauthorized access to, our data or other data that is processed or maintained on our behalf could also disrupt our operations (including our ability to conduct our analyses, pay providers, conduct research and development activities, collect, process and prepare company financial information, provide information about any future products, and manage the administrative aspects of our business) and damage our reputation, any of which could adversely affect our business.
−Removed: HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (“HITECH”), and its implementing regulations, impose certain requirements relating to the privacy, security, transmission and breach reporting of individually identifiable health information upon entities subject to the law, such as health plans, healthcare clearinghouses and healthcare providers and their respective business associates and subcontractors that perform services for them that involve individually identifiable health information.
−Removed: Mandatory penalties for HIPAA violations can be significant, and criminal and monetary penalties, as well as injunctive relief, may be imposed for HIPAA violations.
−Removed: Although most drug manufacturers are not directly subject to HIPAA, prosecutors are increasingly using HIPAA-related theories of liability against drug manufacturers and their agents and we also could be subject to criminal penalties if we knowingly obtain individually identifiable health information from a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.
−Removed: Furthermore, in the event of a breach as defined by HIPAA, HIPAA regulations impose specific reporting requirements to regulators, individuals impacted by the breach and, in some cases, the media.
+Added: HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (“HITECH”), and its implementing regulations, impose certain requirements relating to the privacy, security, transmission and breach reporting of individually identifiable health information.
+Added: Penalties for HIPAA violations can be significant, and criminal and monetary penalties, as well as injunctive relief, may be imposed for HIPAA violations.
+Added: Most drug manufacturers are not directly subject to HIPAA, but prosecutors increasingly are using HIPAA-related theories of liability against drug manufacturers and their agents and we also could be subject to criminal penalties if we knowingly obtain individually identifiable health information from a HIPAA-covered entity in a manner that is not authorized or permitted by HIPAA.
+Added: Furthermore, HIPAA regulations impose specific reporting requirements to regulators, individuals impacted by the breach, as defined by HIPAA, and, in some cases, the media.
Issuing such notifications can be costly, time and resource intensive, and can generate significant negative publicity.
−Removed: Breaches of HIPAA may also constitute contractual violations that could lead to contractual damages or terminations.
−Removed: In addition to HIPAA, other applicable data privacy and security obligations, including U.S.
−Removed: state data breach notification laws, may require us to notify relevant stakeholders of any security breaches or incidents that result in the unauthorized disclosure, or dissemination of, personal information.
+Added: In addition to HIPAA, other applicable data privacy and security obligations may require us to notify relevant stakeholders of any security breaches or incidents that result in the unauthorized disclosure, or dissemination of, personal information.
Such disclosures are costly, and the disclosures or the failure to comply with such requirements, could lead to adverse impacts.
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Likewise, we rely on other third parties for the manufacture of our product candidates and to conduct clinical trials, and similar events relating to their computer systems or otherwise relating to their collection, storage, or processing of data could also have a material adverse effect on our business.
−Removed: In addition, we may face increased cybersecurity risks due to our reliance on internet technology given that we have employees at five office locations (Vancouver, British Columbia;
−Removed: Bellevue, Washington;
−Removed: Dublin, Ireland;
−Removed: and Redwood City, California) and a significant number of employees who work remotely, which may create additional opportunities for cybercriminals to exploit vulnerabilities.
We are subject to stringent and changing obligations related to privacy and security.
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states have enacted and are considering enacting laws relating to the protection of personal information (including health and other data of patients, research subjects, and other individuals), which may be more rigorous than, or impose additional requirements beyond those required by, HIPAA.
−Removed: For example, the California Consumer Privacy Act (“CCPA”), which became effective on January 1, 2020, gives California consumers expanded rights to access and delete their personal information, opt out of certain personal information sharing and receive detailed information about how their personal information is used.
−Removed: The CCPA allows for statutory fines for noncompliance (up to $7,500 per violation) as well as a limited private right of action for data breaches, which may increase the volume of data breach litigation.
−Removed: In addition, the California Privacy Rights Act of 2020, which went into effect on January 1, 2023, expanded the CCPA by, among other things, giving California residents the ability to limit use of certain sensitive personal information, establishing restrictions on personal information retention, expanding the types of data breaches subject to the CCPA’s private right of action, and establishing a new California Privacy Protection Agency to implement and enforce the new law.
−Removed: Many other privacy and security laws have been proposed at the federal level and in other states, certain of which impose obligations similar to the CCPA, including such laws in Colorado, Connecticut, Delaware, Florida, Indiana, Iowa, Montana, New Jersey, Oregon, Tennessee, Texas, Utah, and Virginia.
−Removed: Further, Washington also has enacted the My Health, My Data Act, which, among other things, provides for a private right of action.
−Removed: While limited exemptions to some of these laws may apply to portions of our business, the recency of these laws’ enactment and evolving interpretations of these laws may increase our compliance costs and potential liability.
+Added: For example, the California Consumer Privacy Act (“CCPA”), which became effective in January 2020, gives California consumers expanded rights to access and delete their personal information, opt out of certain personal information sharing and receive detailed information about how their personal information is used.
+Added: The CCPA allows for statutory fines for noncompliance (up to $7,500 per violation) as well as a limited private right of action for data breaches.
+Added: The California Privacy Rights Act of 2020, which went into effect in January 2023, expanded the CCPA in numerous ways and established a new California Privacy Protection Agency to implement and enforce the new law.
+Added: Many other privacy and security laws have been proposed at the federal level and in other states, certain of which impose obligations similar to the CCPA.
+Added: Other privacy and security laws address specific subject matter, such as Washington’s My Health, My Data Act, which, among other things, provides for a private right of action.
+Added: While limited exemptions to some of these laws may apply to portions of our business, these laws’ recent enactment and evolving interpretations may increase our compliance costs and potential liability.
These or other proposed or enacted laws relating to privacy and security could similarly increase our compliance obligations and costs in the future.
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countries covering privacy and security and the protection of health-related and other personal information.
−Removed: In particular, the European Economic Area (“EEA”) has adopted privacy and security protection laws and regulations that impose significant compliance obligations.
−Removed: Laws and regulations in these jurisdictions apply broadly to the collection, use, storage, disclosure, processing and security of information that identifies or may be used to identify an individual, such as names, contact information, and sensitive personal information such as health data.
+Added: In particular, the European Economic Area (“EEA”), the UK, and Switzerland have adopted laws and regulations addressing privacy, data protection and security that impose significant compliance obligations.
These laws and regulations are subject to frequent revisions and differing interpretations, and have generally become more stringent over time.
−Removed: The General Data Protection Regulation 2016/679 (“GDPR”) applies to the processing of personal information and imposes many requirements for controllers and processors of personal information, including, for example, higher standards for obtaining consent from individuals to process their personal information, more robust disclosures to individuals and a strengthened individual data rights regime, shortened timelines for data breach notifications, limitations on retention and secondary use of information, increased requirements pertaining to health data and pseudonymized (i.e., key-coded) data and additional obligations when contracting third-party processors in connection with the processing of the personal information.
+Added: The General Data Protection Regulation 2016/679 (“GDPR”) applies to the processing of personal information and imposes numerous requirements, including, for example, high standards for obtaining consent, requirements for more robust disclosures to individuals and strengthened individual data rights, required data breach notifications, limitations on retention and secondary use of information, increased requirements pertaining to health data and pseudonymized (i.e., key-coded) data and additional obligations when contracting third-party data processors.
The GDPR allows EEA countries to make additional laws and regulations further limiting the processing of genetic, biometric or health data.
−Removed: Failure to comply with the requirements of the GDPR and the applicable national privacy and security laws of EEA countries may result in fines of up to €20,000,000 or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, and other administrative penalties;
−Removed: we may also be liable should any individual who has suffered financial or non-financial damage arising from our infringement of the GDPR exercise their right to receive compensation against us.
−Removed: Furthermore, adverse publicity relating to our failure to comply with the GDPR could cause a loss of goodwill, which could have an adverse effect on our reputation, brand, business and financial condition.
−Removed: Additionally, the United Kingdom (“UK”) has implemented legislation similar to the GDPR, referred to as the UK GDPR, which provides for fines of up to the greater of £17.5 million or 4% of global turnover.
−Removed: Certain jurisdictions, including the EEA, have enacted data localization laws and cross-border personal information transfer laws.
−Removed: For example, absent appropriate safeguards or other circumstances, the GDPR generally restricts the transfer of personal information to countries outside the EEA, such as the United States, which the European Commission does not consider to provide an adequate level of personal information protection.
−Removed: On July 16, 2020, the Court of Justice of the European Union
−Removed: (“CJEU”) invalidated the European Union-U.S.
−Removed: Privacy Shield (“Privacy Shield”) as a data transfer mechanism for transferring personal information from the EEA to the United States.
−Removed: While the EU standard contractual clauses (“EU SCCs”) remain a valid mechanism to transfer personal information to third countries outside the EEA, the CJEU’s ruling has also imposed enhanced due diligence obligations on data exporters and importers to ensure that the laws of the country to which the personal information is transferred offer a level of data protection that is essentially equivalent to the EEA.
−Removed: Also, the EU has issued updated EU SCCs, and the UK has issued its own standard contractual clauses (the “UK SCCs”), which each are required to be implemented.
−Removed: To the extent we transfer personal information from other jurisdictions to the United States, we may not be able to implement or maintain an appropriate data transfer mechanism to continue such international transfers of data.
−Removed: Additionally, the CJEU’s invalidation of the Privacy Shield, the revised EU SCCs and new UK SCCs, regulatory guidance and opinions, and other developments relating to cross-border data transfer may require us to implement additional contractual and technical safeguards for any personal information transferred out of the EEA, UK, or other regions, which may increase compliance costs, lead to increased regulatory scrutiny or liability, and may require additional contractual negotiations, which may adversely impact our business, financial condition, and operating results.
−Removed: Separate from, and in addition to, requirements under the GDPR and UK GDPR, certification requirements for the hosting of health data will vary by jurisdiction.
−Removed: To the extent we operate in various EEA countries or the UK, there might be other national healthcare regulations or regulatory requirements with which we will be required to comply.
+Added: The GDPR provides for fines of up to €20.0 million or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, and other administrative penalties;
+Added: further, the GDPR permits other forms of relief and recovery, and other national and local data protection laws provide for additional penalties and relief.
+Added: Furthermore, adverse publicity relating to actual or alleged GDPR noncompliance could cause a loss of goodwill, which could have an adverse effect on our reputation, brand, business and financial condition.
+Added: The UK has implemented legislation similar to the GDPR, referred to as the UK GDPR, which provides for fines of up to the greater of £17.5 million or 4% of global turnover.
+Added: Certain jurisdictions, including the EEA, have enacted laws and regulations governing cross-border personal information transfer and providing for data localization in certain cases.
+Added: For example, absent appropriate safeguards or other circumstances, the GDPR and laws in Switzerland and the UK generally restrict the transfer of personal information to countries outside the EEA, Switzerland and the UK, such as the United States.
+Added: In July 2023, the European Commission adopted its adequacy decision for the EU-U.S.
+Added: Data Privacy Framework, and generally permits personal information to flow from the EU to the United States by companies participating in the EU-U.S.
+Added: Data Privacy Framework.
+Added: We are not certified under the EU-U.S.
+Added: Data Privacy Framework, and instead rely on other data transfer tools such as the EU standard contractual clauses (“EU SCCs”) and the UK addendum to the EU SCCs to transfer personal information to third countries outside the EEA and the UK, taking into consideration related obligations.
+Added: To the extent we transfer personal information from other jurisdictions to the United States, we may not be able to implement or maintain an appropriate data transfer mechanism to continue such transfers.
+Added: Department of Justice also has issued rules regarding certain bulk sensitive personal data transfers.
+Added: The interpretation of data transfer requirements, regulatory guidance and opinions, and other developments relating to cross-border data transfer may require us to implement additional contractual and technical safeguards for any personal information transferred out of the EEA, Switzerland, the UK, the United States, or other regions, which may increase compliance costs, lead to increased regulatory scrutiny or liability, and may require additional contractual negotiations, which may adversely impact our business, financial condition, and operating results.
+Added: We expect an increase in regulatory requirements relating to privacy, data protection and cybersecurity that may apply to our business.
+Added: For instance, the EU has enacted numerous laws and regulations addressing cybersecurity, including substantial revisions to its Network and Information Security directive that EU member states are required to reflect in national law.
+Added: Requirements for hosting health data will vary by jurisdiction within EEA countries and the UK, and we may be or become subject to other national healthcare regulations or regulatory requirements.
For example, France requires hosts of health data to obtain a prior certification with the competent certification body.
−Removed: The interpretation and application of consumer, health-related and privacy and security laws in the United States, the EEA, and elsewhere are often uncertain, contradictory and in flux.
+Added: The interpretation and application of consumer, health-related and privacy, data protection and security laws in the United States, the EEA, Switzerland, the UK and elsewhere are often uncertain, contradictory and in flux.
Any failure or perceived failure to comply with federal, state or foreign laws or regulations, contractual or other legal obligations related to privacy or security may result in claims, warnings, communications, requests or investigations from individuals, supervisory authorities or other legal or regulatory authorities in relation to our processing of personal information, and regulatory investigations or other proceedings.
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If so, this could result in government-imposed fines or orders requiring that we change our practices, which could adversely affect our business.
−Removed: In addition, these privacy regulations vary between states, may differ from country to country, and may vary based on whether testing is performed in the United States or in the local country.
+Added: These privacy regulations vary between states, may differ from country to country, and may vary based on whether testing is performed in the United States or in the local country.
Complying with these various laws could cause us to incur substantial costs or require us to change our business practices and compliance procedures in a manner adverse to our business.
−Removed: Current and future legislation may increase the difficulty and cost for us to commercialize any products that we or our strategic partners develop and affect the prices we may obtain.
−Removed: The United States and some foreign jurisdictions are considering or have enacted a number of legislative and regulatory proposals to change healthcare systems in ways that could affect our ability to sell any of our product candidates profitably, if such product candidates are approved for sale.
+Added: Current and future legislation may increase the difficulty and cost for us or our strategic partners to commercialize any approved products that we or our strategic partners develop and affect the prices that may be obtained.
+Added: The United States and some foreign jurisdictions are considering or have enacted a number of legislative and regulatory proposals to change healthcare systems in ways that could affect our or our strategic partners’ ability to sell any of our product candidates profitably, if such product candidates are approved for sale.
Among policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and expanding access.
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Since the enactment of PPACA, there have been executive, judicial and Congressional challenges to certain aspects of the PPACA, including judicial challenges in the Fifth Circuit Court and the United States Supreme Court.
−Removed: In June 2021, the United States Supreme Court held that Texas and other challengers had no legal standing to challenge the PPACA, dismissing the case without specifically ruling on the constitutionality of the PPACA.
+Added: In June 2021, the U.S.
+Added: Supreme Court held that Texas and other challengers had no legal standing to challenge the PPACA, dismissing the case without specifically ruling on the constitutionality of the PPACA.
Accordingly, the PPACA remains in effect in its current form.
−Removed: It is unclear how future litigation or healthcare measures promulgated by the Biden administration will impact our business, financial condition and results of operations.
+Added: It is unclear how future litigation or healthcare measures promulgated by the Trump administration will impact our business, financial condition and results of operations.
Complying with any new legislation or changes in healthcare regulation could be time-intensive and expensive, resulting in a material adverse effect on our business.
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For example, the Bipartisan Budget Act of 2018, among other things, amended the PPACA, effective January 2019, to close the coverage gap in most Medicare drug plans.
−Removed: The Budget Control Act of 2011, which calls for aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, began in 2013 and, due to subsequent legislative amendments, will remain in effect through 2032, with the exception of a temporary suspension implemented under various COVID-19 relief legislation.
+Added: The Budget Control Act of 2011, which calls for aggregate reductions to Medicare payments to providers of up to 2% per fiscal year, began in 2013 and, due to subsequent legislative amendments, will remain in effect through 2032 unless Congress takes further action.
The American Taxpayer Relief Act of 2012, among other things, further reduced Medicare payments to several providers, including hospitals and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.
−Removed: These laws may result in additional reductions in Medicare and other healthcare funding, which could have a material adverse effect on potential customers for our product candidates, if approved, and, accordingly, our future financial
+Added: These laws may result in additional reductions in Medicare and other healthcare funding, which could have a material adverse effect on potential customers for zanidatamab or our product candidates, if approved, and, accordingly, our future financial operations.
We are unable to predict the future course of federal or state health care legislation or foreign regulations relating to the marketing, pricing and reimbursement of pharmaceutical products.
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Congressional inquiries, presidential executive orders, and proposed federal and state legislation 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.
−Removed: For example, under the American Rescue Plan Act of 2021, effective January 1, 2024, Medicaid statutory rebates will no longer be capped at 100% of AMP (average manufacturer price).
+Added: For example, under the American Rescue Plan Act of 2021, effective January 1, 2024, Medicaid statutory rebates are no longer be capped at 100% of AMP (average manufacturer price).
Elimination of this cap may require pharmaceutical manufacturers to pay more in rebates than it receives on the sale of products, which could have a material impact on our business.
−Removed: Additionally, in July 2021, the Biden administration released an executive order, “Promoting Competition in the American Economy,” with multiple provisions aimed at prescription drugs.
−Removed: In response to Biden’s executive order, on September 9, 2021, the Department of Health and Human Services (“HHS”) released a Comprehensive Plan for Addressing High Drug Prices that outlines principles for drug pricing reform and sets out a variety of potential legislative policies that Congress could pursue as well as potential administrative actions HHS can take to advance these principles.
−Removed: As discussed above, Congress passed the Inflation Reduction Act of 2022, which includes prescription drug provisions that have significant implications for the pharmaceutical industry and Medicare beneficiaries, including allowing the federal government to negotiate a maximum fair price for certain high-priced single-source Medicare drugs, imposing penalties and excise tax for manufacturers that fail to comply with the drug price negotiation requirements, requiring inflation rebates for all Medicare Part B and Part D drugs, with limited exceptions, if their drug prices increase faster than inflation, and redesigning Medicare Part D to reduce out-of-pocket prescription drug costs for beneficiaries, among other changes.
−Removed: Various industry stakeholders have initiated lawsuits against the federal government asserting that the price negotiation provisions of the Inflation Reduction Act are unconstitutional.
−Removed: The impact of these judicial challenges as well as future actions and agency rules implemented by the government on us and the pharmaceutical industry as a whole is unclear.
+Added: As discussed above, Congress passed the Inflation Reduction Act of 2022, which includes prescription drug provisions that have significant implications for the pharmaceutical industry and Medicare beneficiaries, including allowing the federal government to negotiate a maximum fair price for certain high-priced single-source Medicare drugs.
The implementation of cost containment measures, including the prescription drug provisions under the Inflation Reduction Act, as well as other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our product candidates if approved.
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Further, many states have proposed or enacted legislation and administrative actions that seek to indirectly or directly regulate pharmaceutical drug pricing, such as by requiring biopharmaceutical manufacturers to publicly report proprietary pricing information or to place a maximum price ceiling on pharmaceutical products purchased by state agencies.
−Removed: For example, the FDA recently authorized the state of Florida to import certain prescription drugs from Canada for a period of two years to help reduce drug costs, provided that Florida’s Agency for Health Care Administration meets the requirements set forth by the FDA.
+Added: For example, the FDA has authorized the state of Florida to develop a drug importation program to import certain prescription drugs from Canada for a limited period to help reduce drug costs, provided that Florida’s Agency for Health Care Administration meets the requirements set forth by the FDA.
Other states may follow Florida.
−Removed: Additionally, a number of states are considering or have enacted state drug price transparency and reporting laws that could substantially increase our compliance burdens and expose us to greater liability under such state laws once we begin commercialization after obtaining regulatory approval for any of our products candidates.
+Added: Additionally, a number of states are considering or have enacted state drug price transparency and reporting laws that could substantially increase compliance burdens and expose us to greater liability under such state laws once we begin commercialization after obtaining regulatory approval for any of our products candidates.
We cannot be sure to what extent these and future legislative and regulatory efforts, whether FDA regulations, guidance or interpretations will be changed, or what the impact of such changes on the marketing approvals of our product candidates, if any, may be.
−Removed: In addition, increased scrutiny by Congress of the FDA’s approval process may significantly delay or prevent marketing approval, as well as subject us to more stringent product labeling and post-marketing testing and other requirements.
+Added: Increased scrutiny by Congress of the FDA’s approval process may significantly delay or prevent marketing approval, as well as subject us to more stringent product labeling and post-marketing testing and other requirements.
These measures could reduce the ultimate demand for our products, once approved, or put pressure on our product pricing.
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In addition to continuing pressure on prices and cost containment measures, legislative developments at the EU or member state level may result in significant additional requirements or obstacles that may increase our operating costs.
−Removed: In international markets, reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies.
+Added: international markets, reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies.
Our future products, if any, might not be considered medically reasonable and necessary for a specific indication or cost-effective by third-party payors, an adequate level of reimbursement might not be available for such products, and third-party payors’ reimbursement policies might adversely affect our or our strategic partners’ ability to sell any future products profitably.
−Removed: Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical products.
−Removed: We cannot be sure whether additional legislative changes will be enacted, or whether the FDA regulations, guidance or interpretations will be changed, or what the impact of such changes on the marketing approvals of our product candidates, if any, may be.
−Removed: In addition, increased scrutiny by the U.S.
−Removed: Congress of the FDA’s approval process may significantly delay or prevent marketing approval, as well as subject us to more stringent product labeling and post-approval testing and other requirements.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or elsewhere.
−Removed: If we or our strategic partners are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we or our strategic partners are not able to maintain regulatory compliance, our product candidates may lose any marketing approval that may have been obtained and we may not achieve or sustain profitability, which would adversely affect our business.
−Removed: Unstable or unfavorable global market and economic conditions may have adverse consequences on our business, financial condition and stock price.
−Removed: Global credit and financial markets have experienced extreme volatility and disruptions in the past several years, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in the rate of inflation and uncertainty about economic stability.
−Removed: We cannot assure you that further deterioration in credit and financial markets and confidence in economic conditions will not occur.
−Removed: Our business, financial condition, and stock price may be adversely affected by any such economic downturn, volatile business environment, or large-scale unpredictable or unstable market conditions, including a prolonged government shutdown, geopolitical events such as the conflict between Russia and Ukraine and the conflict in Israel and the Gaza Strip, or a global pandemic such as the COVID-19 pandemic.
−Removed: If the current equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult, more costly and more dilutive.
−Removed: Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon development plans.
−Removed: In addition, there is a risk that one or more of our current service providers, manufacturers and other partners may not survive difficult economic times, which could directly affect our ability to attain our operating goals on schedule and on budget.
+Added: If we or our strategic partners are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we or our strategic partners are not able to maintain regulatory compliance, any approved products may lose any marketing approval that may have been obtained and we may not achieve or sustain profitability, which would adversely affect our business.
Our business may become subject to economic, political, regulatory and other risks associated with international operations.
+Added: Our business, financial condition, and stock price may be adversely affected by economic downturns, a volatile business environment, or large-scale unpredictable or unstable or unfavorable market conditions, including a prolonged government shutdown, geopolitical events, or a global pandemic.
+Added: If events like these occur, our business may be materially and adversely impacted, including making any necessary debt or equity financing more difficult, more costly and more dilutive.
Our business is subject to risks associated with conducting business internationally.
−Removed: We have physical operations and personnel in Canada, the United States, Ireland and Singapore, and maintain offices in these four countries.
+Added: We have physical operations and personnel in North America, Europe and Asia.
In addition, some of our suppliers and collaborative and clinical trial relationships are located outside the United States.
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• economic instability or weakness, including inflation, reduced growth, diminished credit availability, weakened consumer confidence or increased unemployment;
−Removed: • instability in the international geopolitical environment, including as a result of the Russian invasion of Ukraine and the conflict in Israel and the Gaza Strip;
+Added: • insta bility in the international geopolitical environment, including as a result of the Russian invasion of Ukraine and the conflicts in Israel and the broader Middle East;
• sociopolitical instability in particular foreign economies and markets;
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laws and regulations;
−Removed: • changes in non-U.S.
+Added: • c hanges in non-U.S.
regulations and customs, tariffs and trade barriers, including any changes that China may impose as a result of political tensions between Canada and China or the United States and China;
−Removed: • regulatory changes and economic conditions following the UK’s withdrawal from the EU and uncertainty related to the terms of the withdrawal;
• changes in non-U.S.
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• trade protection measures, import or export licensing requirements or other restrictive actions by U.S.
+Added: • restrictions on cross-border data exchanges;
• differing reimbursement regimes, including price controls;
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• business interruptions resulting from geopolitical actions, including war and terrorism, or natural disasters including earthquakes, typhoons, floods and fires;
−Removed: • supply and other disruptions resulting from the impact of public health epidemics, including the COVID-19 pandemic, on our strategic partners, third-party manufacturers, suppliers and other third parties upon which we rely.
−Removed: • In particular, there is currently significant uncertainty about the future relationship between the United States and various other countries, most significantly China, with respect to trade policies, treaties, tariffs, taxes, and other limitations on cross-border operations.
+Added: • supply and other disruptions resulting from the impact of public health epidemics on our strategic partners, third-party manufacturers, suppliers and other third parties upon which we rely.
+Added: In particular, there is currently significant uncertainty about the future relationship between the United States and various other countries, most significantly China, with respect to trade policies, treaties, tariffs, treatment of intellectual property, taxes, and other limitations on cross-border operations, including but not limited to the provision of services and the exchange of data.
government has made and continues to make significant additional changes in U.S.
−Removed: trade policy and may continue to take future actions that could negatively impact U.S.
−Removed: For example, legislation has been introduced in Congress to limit certain U.S.
−Removed: biotechnology companies from using equipment or services produced or provided by select Chinese biotechnology companies, and others in Congress have advocated for the use of existing executive branch authorities to limit those Chinese service providers’ ability to engage in business in the U.S.
−Removed: We cannot predict what actions may ultimately be taken with respect to trade relations between the United States and China or other countries, including countries which the U.S.
−Removed: government has identified as a foreign adversary that poses national security risks to the United States, and what products and services may be subject to such actions or what actions may be taken by the other countries in retaliation.
−Removed: If we are unable to obtain or use services from existing service providers or become unable to export or sell our products to any of our customers or service providers, our business, liquidity, financial condition, and/or results of operations would be materially and adversely affected.
−Removed: Our business has been and may continue to be adversely affected by public health outbreaks and pandemics.
−Removed: Our business has been and may continue to be adversely affected by public health outbreaks and pandemics, including the COVID-19 pandemic.
−Removed: The COVID-19 pandemic has had a broad adverse impact on the global economy across many industries and has resulted in significant governmental measures being implemented to control the spread of the virus, including quarantines, travel restrictions and business shutdowns, as well as significant volatility in global financial markets.
−Removed: On May 11, 2023, the federal government ended the COVID-19 public health emergency, which ended a number of temporary changes made to federally funded programs while some continue to be in effect.
−Removed: The full impact of this termination of the public health emergencies on the FDA and other regulatory policies and operations are unclear.
−Removed: If a public health outbreak, pandemic, or a resurgence of COVID-19 cases and related disruptions were to occur, particularly in regions where we or our strategic partners and suppliers do business, we could experience disruptions that could significantly impact our current and planned clinical trials, preclinical research and other business activities, including:
+Added: trade policy and may continue to take
+Added: future actions that could negatively impact U.S.
+Added: For example, there have been legislative proposals that would limit the extension of certain specific types of government contracts or renewals, loans, or grants, to companies that may do business with select Chinese biotechnology equipment or service providers.
+Added: If enacted, such legislation will preclude certain U.S.
+Added: biotechnology companies from using equipment or services produced or provided by those Chinese biotechnology companies when performing on specified types of agreements with the U.S.
+Added: Others in Congress have advocated for the use of existing executive branch authorities to limit certain Chinese service providers’ ability to engage in business in the United States.
+Added: We cannot predict whether any proposed legislation will be enacted, what executive actions may implicate these kinds of service relationships, or what other actions may ultimately be taken with respect to trade relations between the United States and China or other countries, including countries which the U.S.
+Added: government has identified as a foreign adversary that poses national security risks to the United States.
+Added: Relatedly, the United States has recently enacted and proposed to enact significant new tariffs.
+Added: President Trump has directed various federal agencies to further evaluate key aspects of U.S.
+Added: trade policy and there has been ongoing discussion and commentary regarding potential significant changes to U.S.
+Added: trade policies, treaties and tariffs.
+Added: There continues to exist significant uncertainty about the future relationship between the United States and other countries with respect to such trade policies, treaties and tariffs.
+Added: These developments, or the perception that any of them could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between the impacted nations and the United States.
+Added: Any of these factors could depress economic activity and restrict our access to third party services as well as disrupt the supply chain for the sourcing of our product candidates.
+Added: If we or our partners are unable to obtain or use services from existing service providers, unable to source supplies of product candidates or approved drugs, or unable to export or sell approved products our business, liquidity, financial condition, and/or results of operations would be materially and adversely affected.
+Added: Our business has been in the past and may in the future be adversely affected by public health outbreaks and pandemics.
+Added: Our business has been in the past and may in the future be adversely affected by public health outbreaks and pandemics.
+Added: If a public health outbreak or pandemic, including a resurgence of COVID-19 cases, leads to disruptions in our industry or to our service providers, particularly in regions where we or our strategic partners and suppliers do business, we could experience disruptions that could significantly impact our current and planned clinical trials, preclinical research and other business activities, including:
• disruption to and delays in preclinical research activities due to extended closure or reduced capacity of lab facilities;
−Removed: • further delays or difficulties in enrolling patients in our ongoing and planned clinical trials;
+Added: • delays or difficulties in enrolling patients in our ongoing and planned clinical trials;
• patients discontinuing their treatment or follow-up visits;
−Removed: • further delays or difficulties in clinical site initiation, including limitations on access to sites, limitations to site initiation activities that can be carried out remotely, and limitations on the number of clinical site staff on site from time to time;
+Added: • delays or difficulties in clinical site initiation, including limitations on access to sites, limitations to site initiation activities that can be carried out remotely, and limitations on the number of clinical site staff on site from time to time;
• interruption of key clinical trial activities, such as clinical trial site monitoring, due to limitations on travel imposed or recommended by federal or state governments, employers and others;
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The impact of such disruptions would be highly uncertain and would depend on factors such as the location, duration and severity, travel restrictions and social distancing, business closures or disruptions, and the effectiveness of actions taken to contain and treat the disease and to address its impact, including on financial markets.
−Removed: In addition, public health outbreaks, pandemics, or a resurgence of COVID-19 cases and related disruptions could disrupt the global financial markets, reducing our ability to access capital, which could negatively affect our liquidity and could heighten the volatility of the financial markets, which could adversely impact the value of our common stock.
+Added: Public health outbreaks, pandemics, and related disruptions could disrupt the global financial markets, reducing our ability to access capital, which could negatively affect our liquidity and could heighten the volatility of the financial markets, which could adversely impact the value of our common stock.
Our business and current and future relationships with customers and third-party payors in the United States and elsewhere will be subject, directly or indirectly, to applicable federal and state anti-kickback, fraud and abuse, false claims, transparency, health information privacy and security, and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm, administrative burdens, and diminished profits and future earnings.
−Removed: Healthcare providers, physicians and third-party payors in the United States and elsewhere play a primary role in the recommendation and prescription of any product candidates for which we obtain marketing approval.
−Removed: Our current and future arrangements with healthcare professionals, principal investigators, consultants, customers, and third-party payors and other entities may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations, including the federal Anti-Kickback Statute and the federal False Claims Act, that may constrain the business or financial arrangements and relationships through which we conduct clinical research on product candidates and market, sell and distribute any products for which we obtain marketing approval.
+Added: Healthcare providers, physicians and third-party payors in the United States and elsewhere play a primary role in the recommendation and prescription of zanidatamab and any product candidates for which we obtain marketing approval.
+Added: Our current and future arrangements with healthcare professionals, principal investigators, consultants, customers, and third-party payors and other entities may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations, including the federal Anti-Kickback Statute and the federal False Claims Act, that may constrain the business or financial arrangements and relationships through which we conduct clinical research on product candidates and market, sell and distribute any approved products.
In addition, we may be subject to transparency laws and patient privacy regulation by the federal government and by the U.S.
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public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of or payment for healthcare benefits, items or services relating to healthcare matters;
−Removed: • HIPAA, as amended by HITECH, and its implementing regulations, which imposes certain obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information without the appropriate authorization by entities subject to the law, such as health plans,
−Removed: healthcare clearinghouses and healthcare providers and their respective business associates and their covered subcontractors;
−Removed: • the federal Open Payments program under the Physician Payments Sunshine Act, created under Section 6002 of the PPACA and its implementing regulations, requires applicable group purchasing organizations and manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to HHS information related to “payments or other transfers of value” made in the previous year to covered recipients, including physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors, other health care professionals (such as nurse practitioners and physician assistants) and teaching hospitals, and information regarding ownership and investment interests held by physicians (as defined above) or their immediate family members;
+Added: • HIPAA, as amended by HITECH, and its implementing regulations, which imposes certain obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information without the appropriate authorization by entities subject to the law, such as health plans, healthcare clearinghouses and healthcare providers and their respective business associates and their covered subcontractors;
+Added: • the federal Open Payments program under the Physician Payments Sunshine Act, created under Section 6002 of the PPACA and its implementing regulations, requires applicable group purchasing organizations and manufacturers of
+Added: drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually to HHS information related to “payments or other transfers of value” made in the previous year to covered recipients, including physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors, other health care professionals (such as nurse practitioners and physician assistants) and teaching hospitals, and information regarding ownership and investment interests held by physicians (as defined above) or their immediate family members;
• analogous and similar state and foreign laws and regulations, including:
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Any failure or perceived failure by us to comply with such laws, regulations, or case law may result in governmental investigations or enforcement actions, litigation, claims and other proceedings, harm our reputation, and could result in significant liability.
−Removed: Additionally, if our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, including damages, fines, imprisonment, exclusion from participation in government healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of noncompliance with these laws and the curtailment or restructuring of our operations, which could have a material adverse effect on our business.
+Added: If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, including damages, fines, imprisonment, exclusion from participation in government healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of noncompliance with these laws and the curtailment or restructuring of our operations, which could have a material adverse effect on our business.
If any of the physicians or other providers or entities with whom we expect to do business, including our strategic partners, is found not to be in compliance with applicable laws, it may be subject to criminal, civil or administrative sanctions, including exclusions from participation in government healthcare programs, which could also materially affect our business.
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§ 201, the U.S.
−Removed: Travel Act, the USA PATRIOT Act, the United Kingdom Bribery Act 2010, the Proceeds of Crime Act 2002, and other state and national anti-bribery and anti-money laundering laws in the countries in which we conduct activities.
+Added: Travel Act, the USA PATRIOT Act, the UK Bribery Act 2010, the Proceeds of Crime Act 2002, and other state and national anti-bribery and anti-money laundering laws in the countries in which we conduct activities.
Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, contractors, and other partners from authorizing, promising, offering, or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector.
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We can be held liable for the corrupt or other illegal activities of our employees, agents, contractors, and other partners, even if we do not explicitly authorize or have actual knowledge of such activities.
−Removed: Any violation of the laws and regulations described
−Removed: above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.
+Added: Any violation of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.
Third-party manufacturers may not be able to comply with U.S.
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We have incurred significant losses since inception and anticipate that we will continue to incur losses for the foreseeable future.
−Removed: We have no products approved for commercial sale, and, as of December 31, 2023, we have not generated any revenue or profit from product sales.
+Added: We have only one product approved for commercial sale, and, as of December 31, 2024, we have not received any revenue or profit from product sales.
We may never achieve or sustain profitability.
−Removed: We are a clinical-stage biopharmaceutical company.
We have incurred significant losses since our inception.
−Removed: Our net loss for the years ended December 31, 2023 and 2021 was $118.7 million and $211.8 million, respectively, while net income for the year ended December 31, 2022 was $124.3 million, which was driven in large part by our entry into the Original Jazz Collaboration Agreement (as defined below) and the receipt of certain payments thereunder, and we do not anticipate being net income positive on a regular basis for the foreseeable future.
+Added: Our net losses for the years ended December 31, 2024 and 2023 were $122.7 million and $118.7 million, respectively, while our net income for the year ended December 31, 2022 was $124.3 million, which was driven in large part by our entry into the Original Jazz Collaboration Agreement (as defined below) and the receipt of certain payments thereunder, and we do not anticipate being net income positive on a regular basis for the foreseeable future.
As of December 31, 2024, our accumulated deficit was $830.3 million.
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The net losses and negative cash flows incurred as of December 31, 2024, together with expected future losses, have had, and likely will continue to have, an adverse effect on our stockholders’ deficit and working capital.
−Removed: The amount of future net losses will depend, in part, on the rate of future growth of our expenses and our ability to generate revenue.
+Added: The amount of future net losses will depend, in part, on the rate of future growth of our expenses and our ability to generate revenue, including through the receipt of royalties from our strategic partners.
Because of the numerous risks and uncertainties associated with pharmaceutical product development, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to achieve profitability.
−Removed: To become and remain profitable, we must succeed in developing and commercializing product candidates with significant market potential.
+Added: To become and remain profitable, we or our strategic partners must succeed in developing and commercializing product candidates with significant market potential.
This will require us to be successful in a range of challenging activities for which we are only in the preliminary stages, including developing product candidates, obtaining regulatory approval for such product candidates, and manufacturing, marketing and selling those product candidates for which we may obtain regulatory approval.
−Removed: We may never succeed in these activities and may never generate revenue from product sales that is significant enough to achieve profitability.
+Added: We may never succeed in these activities and may never generate revenue from product sales or royalties that is significant enough to achieve profitability.
Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods.
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A decline in the value of our company could also cause our stockholders to lose all or part of their investment.
−Removed: Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of uncertainty.
−Removed: We have never generated any revenue from product sales and may never be profitable.
+Added: Biopharmaceutical prod uct development is a highly speculative undertaking and involves a substantial degree of uncertainty.
+Added: We have never received any revenue from product sales and may never be profitable.
We have devoted substantially all of our financial resources and efforts to developing our proprietary therapeutic platforms, identifying potential product candidates and conducting preclinical studies and clinical trials.
−Removed: We and our partners are still developing our product candidates, and we have not completed development of any products.
+Added: Zanidatamab is the only product candidate developed with our therapeutic platforms that has received regulatory approval, and we and our strategic partners are still developing other product candidates.
Our revenue as of December 31, 2024 has been primarily revenue from the license of our proprietary therapeutic platforms for the development of product candidates by others or revenue from our strategic partners.
Our ability to generate revenue and achieve profitability depends in large part on our ability, alone or with our strategic partners, to achieve milestones and to successfully complete the development of, obtain the necessary regulatory approvals for, and commercialize, product candidates.
−Removed: We do not anticipate generating revenue from sales of products in the near term.
+Added: While we anticipate receiving royalties from sales of zanidatamab, we do not anticipate generating revenue from sales of our wholly-owned product candidates in the near term.
We will require substantial additional funding, which may not be available to us on acceptable terms, or at all, and, if not available, may require us to delay, scale back, or cease our product development programs or operations.
−Removed: We currently have two clinical-stage lead product candidates, zanidatamab and zanidatamab zovodotin.
−Removed: Our partner Jazz has been responsible for the conduct of ongoing and future zanidatamab trials since May 2023, and is currently evaluating this product candidate in Phase 1, Phase 2, and Phase 3 clinical trials, including certain ongoing pivotal clinical trials.
−Removed: Following the transfer of certain of our personnel to Jazz in May 2023, we have been focused on the clinical development of zanidatamab zovodotin and our preclinical product candidates and general discovery efforts.
−Removed: We are currently evaluating zanidatamab zovodotin in a Phase 1 clinical trial in patients with recurrent or metastatic HER2-expressing solid tumors.
−Removed: Developing pharmaceutical products, including conducting preclinical studies and clinical trials, is expensive.
+Added: We currently have two clinical-stage product candidates, ZW171 and ZW191.
+Added: We have licensed zanidatamab to our strategic partner Jazz, which has been responsible for completing its clinical development in the United States and other jurisdictions not covered by our license to BeiGene.
+Added: In November 2024, Jazz announced the FDA granted accelerated approval for Ziihera ® for injection for intravenous use for the treatment of adults with previously treated, unresectable or metastatic HER2+ (IHC 3+) BTC.
+Added: Jazz is conducting the confirmatory trial for Ziihera ® related to the accelerated approval.
+Added: If the confirmatory trial fails to
+Added: demonstrate a clinical benefit, FDA may remove Ziihera ® from the market, which would negatively impact our ability to earn milestone payments and royalties under our arrangement with Jazz.
+Added: We are focused on the development of our early-stage product candidates and general discovery efforts.
+Added: Following the clearance of our IND applications for both ZW171 and ZW191, we are actively progressing with additional submissions in selected non-U.S.
+Added: countries in relation to our Phase 1 study sites in North America, Europe, and the Asia-Pacific region.
+Added: D eveloping pharmaceutical products, including conducting preclinical studies and clinical trials, is expensive.
In order to obtain regulatory approval, we will be required to conduct clinical trials for each indication for each of our product candidates.
−Removed: Although our collaboration agreements with Jazz and BeiGene provide for additional future funding for zanidatamab, we will continue to require additional funding to complete the development and commercialization of zanidatamab zovodotin, and to continue to advance the development of our other product candidates, and such funding may not be available on acceptable terms or at all.
+Added: Although our collaboration agreements with Jazz and BeiGene provide for additional future funding for zanidatamab, we will continue to require additional funding to advan ce and complete the development of our other product candidates, and such funding may not be available on acceptable terms or at all.
If sufficient funds on acceptable terms are not available when needed, or at all, we could be forced to significantly reduce operating expenses and delay, scale back or eliminate one or more of our development programs or our business operations.
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To the extent that we raise additional capital through the sale of equity or convertible debt securities, our stockholders’ ownership interest will be diluted, and the terms of these new securities may include liquidation or other preferences that adversely affect our stockholders’ rights as common stockholders.
−Removed: On November 9, 2022, we entered into the Sales Agreement with Cantor to sell shares of our common stock having an aggregate offering price of up to $150.0 million, from time to time, through an “at-the-market” equity offering program under which Cantor is acting as our sales agent.
−Removed: On June 16, 2023, we sold an aggregate of 3,350,000 shares of common stock under the Sales Agreement for net proceeds of $26.2 million, after underwriting commissions and offering expenses.
−Removed: In addition, on December 23, 2023, we entered in a securities purchase agreement for a private placement with certain institutional accredited investors affiliated with EcoR1 Capital, LLC of 5,086,521 pre-funded warrants to purchase 5,086,521 shares of our common stock for an aggregate purchase price of approximately $50.0 million.
+Added: For example, from time to time, we have entered into “at-the-market” equity offering programs to sell shares of our common stock including in August 2024, our entry into the Cowen Sales Agreement with TD Cowen as sales agent to sell shares of our common stock, subject to a maximum aggregate dollar amount registered pursuant to an applicable prospectus supplement.
+Added: As part of the ongoing management of our operations and related funding needs, we evaluate various financing vehicles, including “at-the-market” equity offering programs, and may enter into similar “at-the-market” equity offering programs in the future, as well as other financing transactions.
Debt financing, if available at all, may involve agreements that include covenants limiting or restricting our ability to take specific actions such as incurring additional debt, making capital expenditures, or declaring dividends.
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We cannot assure that we will be able to obtain additional funding if and when necessary.
−Removed: If we are unable to obtain adequate financing on a timely basis, we could be required to delay, scale back or
−Removed: eliminate one or more of our development programs or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.
+Added: If we are unable to obtain adequate financing on a timely basis, we could be required to delay, scale back or eliminate one or more of our development programs or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.
Our effective tax rate may change in the future.
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subsidiaries in a manner that may adversely impact our effective tax rate.
−Removed: For example, we may have to include additional amounts in income under the so-called “global intangible low-taxed income” regime or as a result of the application of “controlled foreign corporation” rules.
−Removed: In addition, the United States has enacted the Inflation Reduction Act, which, among other changes, imposes a 1% excise tax on certain stock buybacks and an alternative minimum tax on adjusted financial statement income.
+Added: For example, we have had to include additional amounts in income (such as interest income) under the so-called “global intangible low-taxed income” regime and may be required to do so in the future under the “global intangible low-taxed income” regime or as a result of the application of “controlled foreign corporation” rules.
+Added: The United States has enacted the Inflation Reduction Act, which, among other changes, imposes a 1% excise tax on certain stock buybacks and an alternative minimum tax on adjusted financial statement income.
In addition, our Canadian tax attributes (including net operating loss and tax credit carryforwards and deductible Scientific Research and Experimental Development Expenditure carryforwards) will generally not be available to offset U.S.
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Taxation of international business operations and intercompany transactions, including transactions between us and non-U.S.
−Removed: subsidiaries, is complicated.
+Added: subsidiaries, is complicated and our expenses may increase as a result of any steps we take to enhance our compliance efforts.
Any changes in the U.S.
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In October 2022, Zymeworks BC entered into a License and Collaboration Agreement (the “Original Jazz Collaboration Agreement”) with Jazz, under which Jazz obtained development and commercialization rights of zanidatamab throughout the world, but excluding certain territories already covered by Zymeworks BC’s agreement with BeiGene.
−Removed: Pursuant to the terms of the agreement, we received a $50 million upfront payment following receipt of HSR Clearance and delivery of licenses and technology transfer to Jazz and a further payment of $325 million following Jazz ’ s decision to continue the collaboration after readout of the top-line clinical data from HERIZON-BTC-01.
−Removed: We were also eligible to receive additional milestone payments upon achievement of certain regulatory and commercial milestones, as well as tiered royalties on Jazz’s net sales of licensed products.
−Removed: In April 2023, certain of our subsidiaries entered into the Transfer Agreement with Jazz Inc., an affiliate of Jazz.
−Removed: Pursuant to the terms of the Transfer Agreement, we took a series of steps designed to simplify, focus, and potentially expedite the clinical development and commercialization of zanidatamab in partnership with Jazz by transferring certain assets, contracts and employees associated with our zanidatamab development program to Jazz and its affiliates.
−Removed: As part of the transactions contemplated by the Transfer Agreement, at the Closing in May 2023, Zymeworks BC and Jazz amended and restated the Original Jazz Collaboration Agreement to reflect the transfer of responsibility for the Program (as amended, the “Amended Jazz Collaboration Agreement”).
−Removed: Under the Amended Jazz Collaboration Agreement, the financial terms of the Original Jazz Collaboration Agreement, as previously disclosed, are unchanged, except that the costs of the Program (including ongoing costs related to the service providers transferred to Jazz Inc.
−Removed: purs uant to the Transfer Agreement) incurred following the Closing are directly borne by Jazz instead of being incurred by us and charged back to Jazz for reimbursement, though Zymeworks BC will remain eligible for reimbursement of certain costs for activities where Zymeworks BC maintains responsibility under the Amended Jazz Collaboration Agreement.
+Added: In April 2023, certain of our subsidiaries entered into a stock and asset purchase agreement with Jazz Inc.
+Added: (as amended, the “Transfer Agreement”).
+Added: Pursuant to the terms of the Transfer Agreement, we took a series of steps designed to simplify, focus, and potentially expedite the clinical development and commercialization of zanidatamab in partnership with Jazz by transferring certain assets, contracts and employees associated with our zanidatamab development program to Jazz and its affiliates (the “Program”).
+Added: As part of the transactions contemplated by the Transfer Agreement, at the closing of the Transfer Agreement in May 2023, Zymeworks BC and Jazz amended and restated the Original Jazz Collaboration Agreement to reflect the transfer of responsibility for the Program (as amended, the “Amended Jazz Collaboration Agreement”).
+Added: Under the Amended Jazz Collaboration Agreement, the financial terms of the Original Jazz Collaboration Agreement, as previously disclosed, were unchanged, except that the costs of the Program (including ongoing costs related to the service providers transferred to Jazz purs uant to the Transfer Agreement) incurred following the closing of the Transfer Agreement are directly borne by Jazz instead of being incurred by us and charged back to Jazz for reimbursement, though Zymeworks BC remains eligible for reimbursement of certain costs for activities where Zymeworks BC maintains responsibility under the Amended Jazz Collaboration Agreement.
Other material terms in the Amended Jazz Collaboration Agreement also remain substantially similar to the terms of the Original Jazz Collaboration Agreement, including commercialization, term and termination, and certain other customary terms and conditions, including mutual representations and warranties, indemnification, and confidentiality provisions.
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• adverse decisions by Jazz regarding the development and commercialization of zanidatamab;
+Added: • Jazz’s ability to manufacture, directly or through third parties, commercially required quantities of zanidatamab in a timely manner or at all;
+Added: • Jazz’s compliance with ongoing post-marketing obligations, including completion of the confirmatory trial for zanidatamab;
• possible disagreements as to the timing, nature and extent of development plans, including clinical trials or regulatory approval strategy;
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• possible disagreements with Jazz regarding the agreement, for example, with regard to ownership of intellectual property rights or program costs and reimbursement matters;
+Added: • Jazz may not perform its obligations as expected.
+Added: In November 2024, Jazz announced the FDA granted accelerated approval for Ziihera ® for injection for intravenous use for the treatment of adults with previously treated, unresectable or metastatic HER2+ (IHC 3+) BTC.
+Added: Jazz is conducting the confirmatory trial for Ziihera ® related to the accelerated approval.
+Added: If the confirmatory trial fails to demonstrate a clinical benefit, the FDA may remove Ziihera ® from the market, which would negatively impact our ability to earn milestone payments and royalties under our arrangement with Jazz.
+Added: In addition, although Jazz is developing zanidatamab for regulatory approval in additional indications, such regulatory approval may never be achieved.
+Added: If additional indications are not approved, our ability to achieve additional milestone payments and royalties on sales of zanidatamab will be materially and negatively impacted.
+Added: Jazz is also subject to the risks relating to development and commercialization of product candidates or approved products discussed elsewhere in this “Risk Factors” section, which could restrict Jazz’s ability to further develop and commercialize zanidatamab and negatively impact our ability to achieve milestone payments and royalties.
If either we or Jazz fail to perform our respective obligations, any clinical trial, regulatory approval or development progress could be significantly delayed or halted, could result in costly or time-consuming litigation or arbitration and could have a material adverse effect on our business.
+Added: In addition, we depend on Jazz to provide certain information to us regarding the Program, and any delay by Jazz in fulfilling its information-sharing obligations under the Amended Collaboration Agreement could impact our understanding of the status of the Program, as well as result in potential delays or inaccuracies in our disclosures relating to the Program.
Decisions by Jazz to emphasize other drug candidates currently in its portfolio ahead of zanidatamab, or to add competitive agents to its portfolio could result in a decision to terminate the agreement, in which event, among other things, we may be responsible for paying any remaining costs of ongoing or future clinical trials.
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We have limited capabilities for drug development and commercialization of our product candidates, if approved.
−Removed: Accordingly, we have entered into strategic partnerships with other companies that we believe can provide such capabilities, including our collaboration and license agreements with Jazz, BeiGene, BMS, GSK, Daiichi Sankyo, Janssen, Iconic and Merck.
+Added: Accordingly, we have entered into strategic partnerships with other companies that we believe can provide such capabilities, including our collaboration and license agreements with Jazz, BeiGene, BMS, GSK, Daiichi Sankyo, Janssen and Merck.
These relationships also have provided us with non-dilutive funding for our wholly-owned pipeline and therapeutic platforms and we expect to receive additional funding under these strategic partnerships in the future.
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• disagreements with strategic partners, including disagreements over proprietary rights, contract interpretation or the preferred course of development, might cause delays or termination of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive;
+Added: • we may be dependent on strategic partners to provide certain information to us regarding the development of product candidates, and any delay by our strategic partners to full information-sharing obligations could impact our understanding of such development, as well as result in potential delays or inaccuracies in our disclosures;
• strategic partners may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;
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• strategic partnerships may be terminated for the convenience of the partner and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates.
−Removed: For example, each of our collaboration and license agreements with Jazz, BeiGene, BMS, GSK, Daiichi Sankyo, Janssen, Iconic and Merck may be terminated for convenience upon the completion of a specified notice period;
+Added: For example, each of our collaboration and license agreements with Jazz, BeiGene, BMS, GSK, Daiichi Sankyo, Janssen and Merck may be terminated for convenience upon the completion of a specified notice period;
• we may elect to enter into additional licensing or collaboration agreements to partner our product candidates in territories we currently retain, and in the event we grant exclusive rights to such partners, we would be precluded from potential commercialization of our product candidates within the territories in which we have a partner;
• strategic partners may not have the ability or the development capabilities to perform their obligations as expected, including as a result of the impact of a pandemic or epidemic on our strategic partners’ operations or business.
+Added: In addition, our strategic partners are subject to the risks relating to development and commercialization of product candidates discussed elsewhere in this “Risk Factors” section, which could limit their ability to develop and commercialize product candidates and negatively impact our ability to achieve milestone, royalty or other contractual payments.
If our strategic partnerships do not result in the successful development and commercialization of product candidates or if one of our partners terminates its agreement with us, we may not receive any future research funding or milestone or royalty payments under the collaboration.
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We rely on our strategic partners to manufacture product candidates licensed to them or work with multiple third-party contract manufacturers to produce sufficient quantities of materials required for the manufacture of our product candidates for preclinical testing and clinical trials, in compliance with applicable regulatory and quality standards, and intend to do so for the commercial manufacture of our products.
−Removed: unable to arrange for such third-party manufacturing sources, or fail to do so on commercially reasonable terms, we may not be able to successfully produce sufficient supply of product candidate or we may be delayed in doing so.
+Added: If we are unable to arrange for such third-party manufacturing sources, or fail to do so on commercially reasonable terms, we may not be able to successfully produce sufficient supply of product candidate or we may be delayed in doing so.
Such failure or substantial delay could materially harm our business.
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All of our engineered antibodies are manufactured in accordance with cGMP by utilizing cells that are stored in a cell bank.
−Removed: We have one master cell bank and one working cell bank for zanidatamab (also used for zanidatamab zovodotin) and one master cell bank for each of ZW191 and ZW171.
−Removed: Should any cell bank be lost in a catastrophic event, it is possible that we could lose part of a cell bank and have our manufacturing potentially impacted by the need to replace the cell bank.
+Added: We have one master cell bank and one working cell bank for zanidatama b and one master cell bank for each of ZW191 and ZW171.
+Added: S hould any cell bank be lost in a catastrophic event, it is possible that we could lose part of a cell bank and have our manufacturing potentially impacted by the need to replace the cell bank.
Any adverse developments affecting manufacturing operations for our product candidates, if any are approved, may result in shipment delays, inventory shortages, lot failures, product withdrawals or recalls, or other interruptions in the supply of our products.
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In addition, disruptions to ports and other shipping infrastructure, as were experienced during the COVID-19 pandemic, may result in shortages or delays impacting the availability of materials and other supplies, which could negatively impact our manufacturers, suppliers and other third parties on whom we rely.
−Removed: While we have not yet suffered any direct, material negative impacts from these ongoing supply chain disruptions, we cannot be certain that we will not be impacted, which could increase our costs or negatively impact our development timelines.
+Added: While we did not suffer any direct, material negative impacts from these supply chain disruptions, we cannot be certain that we will not be impacted by similar disruptions in the future, which could increase our costs or negatively impact our development timelines.
We rely on third parties to monitor, support, conduct and oversee clinical trials of the product candidates that we are developing and, in some cases, to maintain regulatory files for those product candidates.
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We rely on entities outside of our control, which may include academic institutions, CROs, hospitals, clinics and other third-party strategic partners, to monitor, support, conduct and oversee preclinical studies and clinical trials of our current and future product candidates.
−Removed: We also rely on third parties to perform clinical trials on our current and future product candidates when
−Removed: they reach that stage.
+Added: We also rely on third parties to perform clinical trials on our current and future product candidates when they reach that stage.
As a result, we have less control over the timing and cost of these studies and the ability to recruit trial subjects than if we conducted these trials with our own personnel.
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In addition, if such third-party service providers were to cease operations, temporarily or permanently, face financial distress or other business disruption, or increase their fees, or if our relationships with these providers deteriorate, we could suffer increased costs until an equivalent provider could be found, if at all, or we could develop internal capabilities, if ever.
−Removed: In addition, if we are unsuccessful in choosing or finding high-quality partners, if we fail to negotiate cost-effective relationships with them, or if we ineffectively manage these relationships, it could have an adverse impact on our business and financial performance.
+Added: If we are unsuccessful in choosing or finding high-quality partners, if we fail to negotiate cost-effective relationships with them, or if we ineffectively manage these relationships, it could have an adverse impact on our business and financial performance.
Further, our operations depend on the continuing and efficient operation of our information technology and communications systems and infrastructure, and specifically on “cloud-based” platforms.
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If our products or our strategic partners’ products incorporate any Fab or Fc region mutations covered by any claims of these patents or patents that may issue from these applications, and if licenses for them are not available on commercially reasonable terms or at all, and we are unable to invalidate or render unenforceable those patents, our business could be materially harmed.
−Removed: We are also aware of third-party patents and patent applications containing claims directed to compositions and methods for treating various forms of cancer with antibodies targeting HER2, alone or in combination with other anti-cancer agents, which patents and applications could potentially be construed to cover our product candidates and the use thereof to treat cancer.
−Removed: If our products or our strategic partners’ products were found to infringe any such patents, and if licenses for them are not available on commercially reasonable terms, or at all, and we were unable to invalidate or render unenforceable those patents, our business could be materially harmed.
−Removed: These patents may not expire before we receive marketing authorization for our product candidates, and could delay the commercial launch of one or more future products.
−Removed: There is also no assurance that there are not third-party patents or patent applications of which we are aware, but which we do not believe are relevant to our business, which may, nonetheless, ultimately be found to limit our ability to make, use, sell, offer for sale or import our future approved products or impair our competitive position.
+Added: There is no assurance that there are not third-party patents or patent applications of which we are aware, but which we do not believe are relevant to our business, which may, nonetheless, ultimately be found to limit our ability to make, use, sell, offer for sale or import our future approved products or impair our competitive position.
Patents that we may ultimately be found to infringe could be issued to third parties.
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Some of our competitors may be able to sustain the cost of such litigation and proceedings more effectively than we can because of their substantially greater resources.
−Removed: There is a risk that a court would decide that we or our strategic partners are infringing a third party’s patents and would order us or our strategic partners to stop the activities or stop the manufacture, use, or sale of any product covered by the patents.
+Added: There is a risk that a court would decide that we or our strategic partners are infringing a third party’s patents and would order us or our strategic partners to stop the activities or stop the manufacture, use, or sale of any product covered by the
In that event, we or our strategic partners may not have a viable alternative to the technology protected by the patent and may need to halt work on the affected product candidate or cease commercialization of an approved product.
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Any of our intellectual property rights could be challenged or invalidated despite measures we take to obtain patent and other intellectual property protection with respect to our product candidates and proprietary technology.
−Removed: For example, if we were to initiate legal proceedings against a third party to enforce a patent covering one of our product candidates, the defendant could counterclaim that our patent is invalid and/or unenforceable.
+Added: These challenges could be
+Added: initiated in the courts or administratively in various patent offices.
+Added: For example, if we were to initiate legal proceedings against a third party to enforce a patent covering one of our product candidates, the defendant could counterclaim that our patent is invalid and/or unenforceable or file an administrative action to invalidate our patent.
In patent litigation in the United States and in some other jurisdictions, defendant counterclaims alleging invalidity and/or unenforceability are commonplace.
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• we may obtain patents for certain compounds many years before we obtain marketing approval for products containing such compounds, and because patents have a limited life, which may begin to run prior to the commercial sale of the related product, the commercial value of our patents may be limited;
−Removed: • our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets;
+Added: • our competitors might conduct research and development activities in countries where we do not have patent rights and use the information learned from such activities to develop competitive products for sale in our major commercial markets;
• we may fail to develop additional proprietary technologies that are patentable;
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If our patents are invalidated or otherwise limited or will expire prior to the commercialization of our product candidates, other companies may be better able to develop products that compete with ours, which could adversely affect our competitive business position, business prospects and financial condition.
−Removed: In addition, if the breadth or strength of protection
−Removed: provided by our patents and patent applications is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates.
+Added: In addition, if the breadth or strength of protection provided by our patents and patent applications is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates.
The following are examples of litigation and other adversarial proceedings or disputes that we could become a party to involving our patents or patents licensed to us:
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As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.
−Removed: Further, recent judicial decisions in the U.S.
−Removed: raised questions regarding the award of patent term adjustment (PTA) for patents in families where related patents have issued without PTA.
+Added: Further, judicial decisions in the United States raised questions regarding the award of patent term adjustment (“PTA”) for patents in families where related patents have issued without PTA.
Thus, it cannot be said with certainty how PTA will be viewed in the future and whether patent expiration dates may be impacted.
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However, we may not obtain these agreements in all circumstances, and individuals with whom we have these agreements may not comply with their terms.
−Removed: We cannot guarantee that we have entered into such agreements with each party that has or may have had access to, or houses or hosts, our trade secrets or proprietary information or that has been involved in the development of intellectual property.
+Added: We cannot guarantee that we have entered into such agreements with each party that has or may have had access to, or houses or hosts, our trade secrets or proprietary information or that has
+Added: been involved in the development of intellectual property.
Further, despite such agreements, such inventions or confidential information may become disclosed or assigned to third parties.
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Such assignment or license may not be available on commercially reasonable terms or at all.
−Removed: We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems and cloud storage sources, but such
−Removed: security measures may be breached, including through cyber-hacking or cyberattacks, and we may not have adequate remedies for any breach.
+Added: We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems and cloud storage sources, but such security measures may be breached, including through cyber-hacking or cyberattacks, and we may not have adequate remedies for any breach.
Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming and the outcome is unpredictable.
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Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to maintain trade secret protection could adversely affect our competitive business position.
−Removed: In addition, if any of our trade secrets were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent such third party, or those to whom they communicate such technology or information, from using that technology or information to compete with us.
+Added: If any of our trade secrets were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent such third party, or those to whom they communicate such technology or information, from using that technology or information to compete with us.
If any of our trade secrets were to be disclosed to or independently developed by a competitor, or if we otherwise lose protection for our trade secrets or proprietary know-how, the value of this information may be greatly reduced and our business and competitive position could be harmed.
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Although we are not currently experiencing any claims challenging the inventorship or ownership of our patents, we may in the future be subject to claims that former employees, strategic partners or other third parties have an interest in our patents or other intellectual property as an inventor or co-inventor.
−Removed: While it is our policy to require our employees and contractors who may be involved in the conception or development of intellectual property to execute agreements assigning such intellectual property to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own.
+Added: While it is our policy to require our employees and contractors who may be
+Added: involved in the conception or development of intellectual property to execute agreements assigning such intellectual property to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own.
For example, the assignment of intellectual property rights may not be self-executing or the assignment agreements may be breached, or we may have inventorship disputes arise from conflicting obligations of consultants or others who are involved in developing our product candidates.
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In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this has created uncertainty with respect to the validity, scope and value of patents, once obtained.
−Removed: patent applications containing a priority claim after March 16, 2013, there is a greater level of uncertainty in the patent law.
In September 2011, the Leahy-Smith America Invents Act, also known as the America Invents Act (“AIA”), was signed into law.
−Removed: The AIA includes a number of significant changes to U.S.
−Removed: patent law, including provisions that affect the way patent applications will be prosecuted and may also affect patent litigation.
−Removed: The AIA and its implementation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents, all of which could have an adverse effect on our business.
An important change introduced by the AIA is that, as of March 16, 2013, the United States transitioned to a “first-to-file” system for deciding which party should be granted a patent when two or more patent applications are filed by different parties disclosing or claiming the same invention.
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This requires us to be cognizant of the time from invention to filing of a patent application.
−Removed: Among some of the other changes introduced by the AIA are changes that limit where a patentee may file a patent infringement suit and providing opportunities for third parties to challenge any issued patent in the USPTO.
−Removed: This applies to all of our U.S.
−Removed: patents, even those issued before March 16, 2013.
−Removed: Because of a lower evidentiary standard in USPTO proceedings compared to the evidentiary standard in U.S.
−Removed: federal court necessary to invalidate a patent claim, a third party could potentially provide evidence in a USPTO proceeding sufficient for the USPTO to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented in a district court action.
−Removed: Accordingly, a third party may attempt to use the USPTO procedures to invalidate our patent claims that would not have been invalidated if first challenged by the third party as a defendant in a district court action.
Depending on decisions by the U.S.
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In addition, the laws of some countries do not protect intellectual property rights to the same extent as laws in the United States.
−Removed: Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
+Added: Consequently, we may not be able to prevent third parties from practicing our inventions in all countries
+Added: outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions.
Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and further, may export otherwise infringing products to territories where we have patent protection, but enforcement is not as strong as that in the United States.
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Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license.
−Removed: Additionally, the requirements for patentability may differ in certain countries.
−Removed: For example, China has a heightened requirement for patentability, and specifically requires a detailed description of medical uses of a claimed drug.
−Removed: In India, unlike the United States, there is no link between regulatory approval of a drug and its patent status.
−Removed: In addition to India, certain countries in Europe and developing countries, including China, have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties.
+Added: The requirements for patentability may differ in certain countries, which may make it more difficult for us to obtain sufficient claim scope to protect our products in those jurisdictions.
+Added: India, certain countries in Europe and developing countries, including China, have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties.
In those countries, we and our licensors may have limited remedies if patents are infringed or if we or our licensors are compelled to grant a license to a third party, which could materially diminish the value of those patents.
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Geo-political actions in the United States and in foreign countries could increase the uncertainties and costs surrounding the prosecution or maintenance of our patent applications or those of any current or future licensors or licensees and the maintenance, enforcement or defense of our issued patents or those of any current or future licensors or licensees.
−Removed: For example, the United States, Canadian, and foreign government actions related to Russia’s invasion of Ukraine may limit or prevent filing, prosecution and maintenance of patent applications in Russia.
−Removed: Government actions may also prevent maintenance of issued patents in Russia.
−Removed: These actions could result in abandonment or lapse of our patents or patent applications, resulting in partial or complete loss of patent rights in Russia.
−Removed: If such an event were to occur, it could have a material adverse effect on our business.
−Removed: In addition, a decree was adopted by the Russian government in March 2022, allowing Russian companies and individuals to exploit inventions owned by patentees that have citizenship or nationality in, are registered in, or have a predominately primary place of business or profit-making activities in the United States and other countries that Russia has deemed unfriendly without consent or compensation.
−Removed: Consequently, we would not be able to prevent third parties from practicing our inventions in Russia or from selling or importing products made using our inventions in and into Russia.
Accordingly, our competitive position may be impaired, and our business, financial condition, results of operations and prospects may be adversely affected.
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In Europe, a new unitary patent system was introduced on June 1, 2023, which will significantly impact European patents, including those granted before the introduction of this system.
−Removed: Under the unitary patent system, European applications have the option, upon grant of a patent, of becoming a Unitary Patent which is subject to the jurisdiction of the Unitary Patent Court (UPC).
+Added: Under the unitary patent system, European applications have the option, upon grant of a patent, of becoming a Unitary Patent which is subject to the jurisdiction of the Unitary Patent Court (the “ UPC ” ).
As the UPC is a new court system, there is no precedent for the court, increasing the uncertainty of any litigation.
Patents granted before the implementation of the UPC have the option of opting out of the jurisdiction of the UPC and remaining as national patents in the UPC countries.
−Removed: Patents that remain under the jurisdiction of the UPC are potentially vulnerable to a single UPC-
−Removed: based revocation challenge that, if successful, could invalidate the patent in all countries who are signatories to the UPC.
+Added: Patents that remain under the jurisdiction of the UPC are potentially vulnerable to a single UPC-based revocation challenge that, if successful, could invalidate the patent in all countries who are signatories to the UPC.
We cannot predict with certainty the long-term effects of any potential changes.
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The terms of many open source licenses have not been interpreted by U.S.
−Removed: courts or courts outside of the U.S., and there is a risk that these licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to use this software.
+Added: courts or courts outside of the United States, and there is a risk that these licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to use this software.
As a result, we could be subject to lawsuits by parties claiming ownership of what we believe to be open source software, or claiming that software we developed using such open source software is a derivative work of open source software and demanding the release of portions of our source code, or otherwise seeking to enforce the terms of the applicable open source license.
Litigation could be costly for us to defend, have a negative effect on our financial condition and results of operations or require us to devote additional research and development resources to change our platform and offerings.
−Removed: If we were to combine our proprietary software with open source software in a certain manner, we could, under certain open source licenses, be required to release the source code of our proprietary software to the public.
−Removed: While we monitor our use of open source software and try to ensure that none is used in a manner that would require us to disclose our proprietary source code or that would otherwise breach the terms of an open source agreement, such use could inadvertently occur, or could be claimed to have occurred, in part because open source license terms are often ambiguous.
−Removed: If we inappropriately use open source software, or if the license terms for open source software that we use change, we may be required to re-engineer our platform, incur additional costs, discontinue the use of some or all of our platform or take other remedial actions.
+Added: If we were to combine our proprietary software with open source software in a certain manner, we could, under certain open source licenses, be required to relea se the source code of our proprietary software to the public.
+Added: If we inappropriately use open
+Added: source software, or if the license terms for open source software that we use change, we may be required to re-engineer our platform, incur additional costs, discontinue the use of some or all of our platform or take other remedial actions.
In addition to risks related to license requirements, usage of open source software can lead to greater risks than use of third-party commercial software, because open source licensors generally do not provide warranties or assurance of title or controls on origin of the software.
−Removed: In addition, many of the risks associated with usage of open source software, such as the lack of warranties or assurances of title, cannot be eliminated, and could, if not properly addressed, negatively affect our business.
−Removed: We have established processes to help alleviate these risks, including a review process for the use of open source software, but we cannot be sure that all of our use of open source software is in a manner that is consistent with our current policies and procedures, or will not subject us to liability.
+Added: Many of the risks associated with usage of open source software, such as the lack of warranties or assurances of title, cannot be eliminated, and could, if not properly addressed, negatively affect our business.
Any of these risks could be difficult to eliminate or manage and, if not addressed, could have an adverse effect on our business, financial condition and results of operations.
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These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements.
−Removed: Employee misconduct could also involve the improper use of information obtained
−Removed: in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation.
+Added: Employee misconduct could also involve the improper use of information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation.
We have adopted a Code of Conduct and Business Ethics, but it is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations.
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In addition to FDA restrictions on the marketing of pharmaceutical products, federal and state healthcare laws restrict certain business practices in the biopharmaceutical industry.
−Removed: Although we currently do not have any products on the market, we may be subject, and if our product candidates are approved and we begin commercialization will be subject, to additional healthcare laws and regulations enforced by the federal government and by authorities in the states and foreign jurisdictions in which we conduct our business.
+Added: If our product candidates are approved and we begin commercialization, we will be subject to additional healthcare laws and regulations enforced by the federal government and by authorities in the states and foreign jurisdictions in which we conduct our business.
These state and federal healthcare laws, commonly referred to as “fraud and abuse” laws, have been applied to restrict certain marketing practices in the pharmaceutical industry, and include anti-kickback, false claims, data privacy and security and transparency statutes and regulations.
−Removed: Federal false claims laws prohibit, among other things, any person from knowingly presenting, or causing to be presented, a false claim for payment to the federal government or knowingly making, or causing to be made, a false statement to get a false claim paid.
+Added: Federal false claims laws prohibit, among other things, any person from knowingly presenting, or causing to be presented, a false claim for payment to the federal government or knowingly making, or causing to be made, a false statement to get a false
The federal healthcare program anti-kickback statute prohibits, among other things, knowingly and willfully offering, paying, soliciting or receiving remuneration to induce, or in return for, purchasing, leasing, ordering or arranging for the purchase, lease or order of any healthcare item or service reimbursable under Medicare, Medicaid or other federally financed healthcare programs.
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HIPAA created new federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, including private third-party payors, and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of, or payment for, healthcare benefits, items or services.
−Removed: In addition, we may be subject to data privacy and security regulation by both the federal government and the states in which we conduct our business.
−Removed: HIPAA, as amended by HITECH, and its implementing regulations, imposes certain requirements relating to the privacy, security and transmission of individually identifiable health information.
−Removed: Among other things, HITECH makes HIPAA’s security standards directly applicable to business associates-independent contractors or agents of covered entities that receive or obtain protected health information in connection with providing a service on behalf of a covered entity.
−Removed: HITECH also created four new tiers of civil monetary penalties, and newly empowered state attorneys general with the authority to enforce HIPAA.
−Removed: In January 2013, the Office for Civil Rights of the U.S.
−Removed: Department of Health and Human Services issued the Final Omnibus Rule under HIPAA pursuant to HITECH that makes significant changes to the privacy, security and breach notification requirements and penalties.
−Removed: The Final Omnibus Rule generally took effect in September 2013 and enhances certain privacy and security protections, and strengthens the government’s ability to enforce HIPAA.
−Removed: The Final Omnibus Rule also enhanced requirements for both covered entities and business associates regarding notification of breaches of unsecured protected health information.
+Added: We may be subject to data privacy and security regulation by both the federal government and the states in which we conduct our business, including HIPAA, as amended by HITECH, and its implementing regulations, which imposes certain requirements relating to the privacy, security and transmission of individually identifiable information.
In addition, state laws govern the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways.
These state laws may not have the same effect and often are not preempted by HIPAA, thus complicating compliance efforts.
−Removed: Additionally, the PPACA also included the federal Physician Payments Sunshine Act, which requires applicable group purchasing organizations and manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually information
−Removed: related to certain payments or other transfers of value made in the previous year to covered recipients, including physicians, as defined by law, and teaching hospitals and, effective for data reported in 2022, expanded to include nurse practitioners, physician assistants, clinical nurse specialists, certified registered nurse anesthetists and anesthesiologist assistants, and certified nurse-midwives, including certain ownership and investment interests held by physicians or their immediate family members.
+Added: The PPACA also included the federal Physician Payments Sunshine Act, which requires applicable manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program (with certain exceptions) to report annually information related to certain payments or other transfers of value made in the previous year to covered recipients, including physicians and teaching hospitals, including certain ownership and investment interests held by physicians or their immediate family members.
Failure to comply with the required reporting requirements could subject applicable reporting entities such as manufacturers to substantial civil monetary penalties.
−Removed: Also, many states have similar healthcare statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, or, in several states, apply regardless of the payor.
+Added: Many states have similar healthcare statutes or regulations that apply to items and services reimbursed under Medicaid and other state programs, or, in several states, apply regardless of the payor.
Certain states require pharmaceutical companies to implement a comprehensive compliance program that includes a limit or outright ban on expenditures for, or payments to, individual medical or health professionals and/or require pharmaceutical companies to track and report gifts and other payments made to physicians and other healthcare providers.
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We are also subject to numerous environmental, health and workplace safety laws and regulations and fire and building codes, including those governing laboratory procedures, exposure to blood-borne pathogens, use and storage of flammable agents and the handling of biohazardous materials.
−Removed: Although we maintain workers’ compensation insurance as prescribed by certain jurisdictions in which we operate to cover us for costs and expenses we may incur due to injuries to our employees resulting from the use of these materials, this insurance may not provide adequate coverage against potential liabilities.
+Added: Although we maintain workers’ compensation insurance as prescribed by certain jurisdictions in which we operate to cover us for costs and expenses we may
+Added: incur due to injuries to our employees resulting from the use of these materials, this insurance may not provide adequate coverage against potential liabilities.
We do not maintain insurance for environmental liability or toxic tort claims that may be asserted against us.
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We may be subject to certain costs and inefficiencies as a result of our 2022 Redomicile Transactions.
−Removed: As a result of the Redomicile Transactions, we became a Delaware corporation on October 13, 2022 following the completion of an arrangement under the Business Corporations Act (British Columbia).
+Added: We became a Delaware corporation in October 2022 as a result of the Redomicile Transactions.
Pursuant to the agreements governing the Redomicile Transactions, we agreed to use reasonable efforts to take certain corporate steps and actions, as may be necessary or desirable, to effect and implement certain post-arrangement transactions, including the internal reorganization of certain subsidiaries (the “Post-Arrangement Transactions”).
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As a result, we do not currently intend to complete the Post-Arrangement Transactions.
−Removed: While we expect to manage any tax and operational inefficiencies that may result under our current organizational structure, and we may pursue additional internal reorganizations in the future, certain tax and operational inefficiencies may persist notwithstanding our management and/or additional reorganization that could adversely affect our business, financial condition and results of operations.
−Removed: In addition, we incurred a number of non-recurring costs associated with the Redomicile Transactions, including legal fees, accountants’ fees, proxy solicitor fees, filing fees, mailing expenses and financial printing expenses.
−Removed: The completion of the Redomicile Transactions and the associated reorganization of our corporate structure may result in additional and unforeseen expenses in the future.
−Removed: While it is expected that benefits of the Redomicile Transactions will offset these transaction costs over
−Removed: time, this net benefit may not be achieved in the short-term or at all.
+Added: While we expect to manage any tax and operational inefficiencies that may result under our current organizational structure, and we may pursue additional internal reorganizations in the future, certain tax and operational inefficiencies may persist notwithstanding our management and/or additional reorganization that could adversely affect our business, financial condition and results of operations (including, for example, the requirement to recognize certain income (such as interest income) under the “global intangible low-taxed income” regime).
+Added: We incurred a number of non-recurring costs associated with the Redomicile Transactions, and the associated reorganization of our corporate structure may result in additional and unforeseen expenses in the future.
+Added: While it is expected that benefits of the Redomicile Transactions will offset these transaction costs over time, this net benefit may not be achieved in the short-term or at all.
These combined factors could adversely affect our business and overall financial condition.
−Removed: The success of the Redomicile Transactions will depend, in part, on our ability to realize the anticipated benefits associated with the Redomicile Transactions and associated reorganization of our corporate structure, and we may not be able to realize such benefits on a timely basis or at all.
Risks Related to Employee Matters and Managing Growth
Our future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel.
−Removed: We are highly dependent on key members of our senior management team, including Kenneth Galbraith, the Chair of our board of directors, President and Chief Executive Officer, Christopher Astle, our Chief Financial Officer, Paul Moore, our Chief Scientific Officer, Jeffrey Smith, our Chief Medical Officer, and other key members of our senior management, scientific and clinical teams.
+Added: We are highly dependent on key members of our senior management team, including Kenneth Galbraith, the Chair of our board of directors, President, and Chief Executive Officer, Leone Patterson, our Chief Business Officer and Chief Financial Officer, Paul Moore, our Chief Scientific Officer, Jeffrey Smith, our Chief Medical Officer, and other key members of our senior management, scientific and clinical teams.
Although we have entered into employment agreements with our executive officers, each of them may terminate their employment with us at any time.
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Retention and any future recruitment of qualified scientific, technical, clinical, manufacturing and sales and marketing personnel will also be critical to our success.
−Removed: In connection with the transactions contemplated by the Transfer Agreement in May 2023, certain of our clinical operations personnel and other personnel with later-stage development experience were transferred to Jazz.
−Removed: If we are successful in advancing the development of zanidatamab zovodotin and our preclinical candidates, we will need to evaluate any organizational hiring needs.
+Added: If we are successful in advancing the development of our early-stage candidates, we will need to evaluate any organizational hiring needs.
In addition, we will need to effectively manage our managerial, operational, financial, development and other resources in order to successfully pursue our research, development and commercialization efforts for our existing and future product candidates.
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Intense competition for attracting key skill-sets and the impact of inflationary pressure on wages may limit our ability to attract, retain and motivate key personnel on acceptable terms.
−Removed: We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions.
In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and development and commercialization strategy.
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As we advance our development and commercialization plans and strategies, we may need to grow or modify our organization, and we may experience difficulty in managing such change, which could disrupt our operations.
−Removed: As of December 31, 2023, w e had 272 full-time employees, which reflects the reduction in the number of our employees as a result of the transfer to Jazz Inc.
−Removed: or a Jazz affiliate of certain employees in connection with the Closing of the Transfer Agreement transactions.
+Added: As of December 31, 2024, we had 280 full-time employees.
As we advance our development and commercialization plans and strategies in the future, we anticipate that we may need to expand or modify our employee base.
−Removed: Additionally, as our product candidates enter and advance through preclinical studies and any clinical trials, we may need to expand our development, manufacturing, regulatory sales and marketing capabilities or contract with other organizations to provide these capabilities for us.
−Removed: We believe the need for future expansion in these areas will increase a s our product candidates reach later stages of preclinical and clinical development.
+Added: As our product candidates enter and advance through preclinical studies and any clinical trials, we may need to expand or modify our development, manufacturing, regulatory sales and marketing capabilities or contract with other organizations to provide these capabilities for
+Added: We believe the need for future expansion or modification in these areas will increase a s our product candidates reach later stages of preclinical and clinical development.
Future growth would impose significant added responsibilities on members of management, including the need to identify, recruit, maintain, motivate and integrate additional employees.
Also, our management may need to divert a disproportionate amount of their attention away from our day-to-day activities and devote a substantial amount of time to managing any necessary growth activities.
−Removed: We may not be able to effectively manage an expansion of our operations, which may result in weaknesses in our infrastructure, give rise to operational errors, loss of business opportunities, loss of employees and reduced productivity amongst remaining employees.
−Removed: Any growth could require significant capital expenditures and may divert financial resources from other projects, such as the development of existing and additional product candidates.
−Removed: If our management is unable to effectively manage any needed growth, our expenses may increase more than expected, our ability to generate or grow revenue could be reduced and we may not be able to implement our business strategy.
−Removed: Our future financial performance and our ability to commercialize our product candidates and compete effectively with others in our industry will depend on our ability to effectively manage any future growth.
+Added: We may not be able to effectively manage an expansion or modification of our operations, which may result in weaknesses in our infrastructure, give rise to operational errors, loss of business opportunities, loss of employees and reduced productivity amongst remaining employees.
+Added: Any growth or organizational modification could require significant capital expenditures and may divert financial resources from other projects, such as the development of existing and additional product candidates.
+Added: If our management is unable to effectively manage any needed growth or organizational modifications, our expenses may increase more than expected, our ability to generate or grow revenue could be reduced and we may not be able to implement our business strategy.
+Added: Our future financial performance and our ability to commercialize our product candidates and compete effectively with others in our industry will depend on our ability to effectively manage any future growth or organizational modification.
Risks Related to Our Common Stock
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Investors may be unable to sell their common stock at or above the price they paid for such stock due to fluctuations in the market price of our common stock arising from changes in our operating performance or prospects.
−Removed: Some of the factors that may cause the market price of our common stock to fluctuate or decrease include:
+Added: Factors that may cause the market price of our common stock to fluctuate include:
• results and timing of our clinical trials and clinical trials of our competitors’ products;
• failure or discontinuation of any of our development programs;
−Removed: • the success of our partnerships, including our and Jazz’s ability and efforts to collaborate to develop and commercialize zanidatamab in the territories covered by the Amended Jazz Collaboration Agreement;
−Removed: • our ability to achieve milestones and receive associated milestone payments pursuant to the terms of our collaboration agreements;
+Added: • the success of our partnerships;
+Added: • our ability to achieve milestones and receive associated milestone payments pursuant to the terms of our partnerships;
• issues in manufacturing our product candidates or future approved products;
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• announcements by us, our strategic partners or our competitors of significant acquisitions, strategic partnerships, joint ventures, or capital commitments;
−Removed: • changes in estimates or recommendations by securities analysts that cover our common stock;
+Added: • actions taken by industry or securities analysts that cover our company or common stock, including changes in estimates or recommendations, inaccurate or unfavorable research or a decision to drop coverage;
• fluctuations in the valuation of companies in the biotechnology industry or otherwise perceived by investors to be comparable to us;
• additional instances of stockholder activism, including unsolicited takeover proposals or proxy contests;
−Removed: • claims or litigation related to our stockholder rights plan;
• public concern over our product candidates or any future approved products;
• litigation;
−Removed: • future sales of our common stock;
+Added: • future sales of our common stock or the perception that such sales could occur;
• stock price and volume fluctuations attributable to inconsistent trading volume levels of our common stock;
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• changes in the structure of health care payment systems in the United States or other countries;
−Removed: • failure of any of our product candidates, if approved, to achieve commercial success;
+Added: • failure of zanidatamab or our product candidates, if approved, to achieve commercial success;
• economic and other external factors or other disasters or crises, including pandemics;
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• potential disagreements or disputes with certain of our stockholders;
+Added: • our ability to effectively address environmental, social, and governance matters affecting our business that are a focus of certain investors, environmental activists, the media, and governmental and nongovernmental organizations;
• overall fluctuations in U.S.
equity markets;
+Added: • purchases under our Repurchase Program;
• other factors that may be unanticipated or out of our control.
−Removed: In addition, the stock market in general, and the stock of biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the relevant companies, which has resulted in increased volatility and decreased stock prices for many companies notwithstanding the lack of a fundamental change in their underlying business models or prospects.
+Added: The stock market in general, and the stock of biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the relevant companies, which has resulted in increased volatility and decreased stock prices for many companies notwithstanding the lack of a fundamental change in their underlying business models or prospects.
Broad market and industry factors, including potentially worsening economic conditions and other adverse effects or developments, may negatively affect the market price of our common stock, regardless of our actual operating performance.
+Added: Securities class action litigation has often been brought against companies following a decline in the market price of their securities.
+Added: If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could materially harm our business.
The realization of any of the above risks or any of a broad range of other risks, including those described in this “Risk Factors” section, could have a material adverse effect on the market price of our common stock.
An active trading market for our common stock may not be sustained.
−Removed: Our common stock was first listed on the New York Stock Exchange (the “NYSE”) in connection with the completion of the Redomicile Transactions on October 13, 2022.
−Removed: In December 2022, we moved our listing to The Nasdaq Stock Market LLC (“Nasdaq”).
If an active market for our common stock does not continue, it may be difficult for our stockholders to sell their stock without depressing the market price for the common stock or sell their common stock at or above the prices at which they acquired their common stock or sell their common stock at the time they would like to sell.
Any inactive trading market for our common stock may also impair our ability to raise capital to continue to fund our operations by selling common stock and may impair our ability to acquire other companies or technologies by using our common stock as consideration.
−Removed: We may fail to meet the continued listing requirements of Nasdaq.
+Added: We may fail to meet the continued listing requirements of the Nasdaq Stock Market LLC (“Nasdaq”).
If Nasdaq delists our shares of common stock from trading on its exchange, we could face significant material adverse consequences, including:
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• a decreased ability to issue additional securities or obtain additional financing in the future.
−Removed: Substantial future sales of our common stock, or the perception that these sales could occur, may cause the price of our common stock to drop significantly, even if our business is performing well.
−Removed: A large volume of sales of our common stock could decrease the prevailing market price of our common stock and could impair our ability to raise additional capital through the sale of equity securities in the future.
−Removed: Even if a substantial number of sales of our common stock does not occur, the mere perception of the possibility of these sales could depress the market price of our common stock and have a negative effect on our ability to raise capital in the future.
Our management team has broad discretion to use the net proceeds from our financing activities as well as funds received pursuant to our strategic collaborations, and its investment of these proceeds may not yield a favorable return.
They may invest the proceeds in ways with which our stockholders disagree.
−Removed: Our management team has broad discretion in the applicatio n of the proceeds we receive from our financing activities and from our strategic collaborations, including proceeds received from our strategic collaboration with Jazz and pursuant to any “at-the-market” equity offering programs we may use from time to time, and we could spend or invest the proceeds in ways with which our stockholders disagree.
+Added: Our management team has broad discretion in the applicatio n of the proceeds we receive from our financing activities and from our strategic collaborations, and we could spend or invest the proceeds in ways with which our stockholders disagree.
Accordingly, stockholders will need to rely on our management team’s judgment with respect to the use of these proceeds.
−Removed: However, the failure by management to apply these funds effectively could negatively affect our ability to operate and grow our business.
−Removed: We cannot specify with certainty all of the particular uses for the net proceeds to be received from our fundraising efforts or for the funds received from time to time pursuant to our strategic collaborations.
−Removed: In addition, the amount, allocation and timing of our actual expenditures will depend upon numerous factors, including additional milestone payments received from our strategic partnerships and royalties received on sale of any future approved product.
−Removed: Accordingly, we will have broad discretion in using these proceeds.
+Added: The failure by management to apply these funds effectively could negatively affect our ability to operate and grow our business.
+Added: We cannot specify with certainty all of the particular uses for the net proceeds received from our fundraising efforts or for funds received pursuant to our strategic collaborations and our actual expenditures will depend upon numerous factors.
Until the net proceeds are used, they may be placed in investments that do not produce significant income or that may lose value.
4 unchanged sentences
Investors seeking cash dividends should not invest in our common stock.
−Removed: Any future determination to pay dividends will be at the discretion of our board of directors and will depend upon many factors, including our results of operations, financial position, capital requirements, distributable reserves, credit terms, general economic conditions and other factors as our board of directors may deem relevant from time to time.
−Removed: Consequently, future dividends payable to investors are not guaranteed.
+Added: Any future determination to pay dividends will be at the discretion of our board of directors and will depend upon many factors, and, as a result, future dividends payable to investors are not guaranteed.
Our principal stockholders, in aggregate, could exert substantial influence over us which could delay or prevent a change in corporate control or result in the entrenchment of management or the board of directors.
−Removed: Our principal stockholders, being our stockholders that beneficially own 5% or more of our common stock, together with their affiliates and related persons, in aggregate, beneficially own approximately 47.2% of our outstanding common stock as of December 31, 2023.
−Removed: Our directors and executive officers beneficially own, in the aggregate, approximately 1.4% of our outstanding common stock as of December 31, 2023.
−Removed: Our principal stockholders, if acting together (with or without our directors and executive officers), may have the ability to exert substantial influence over the outcome of matters submitted to our stockholders for approval, including the election and removal of directors and any merger or sale of all or substantially all of our assets.
+Added: Our principal stockholders, being our stockholders that beneficially own 5% or more of our common stock, together with their affiliates and related persons, in aggregate, beneficially owned approximately 53.9% of our outstanding common stock as of December 31, 2024.
+Added: Our directors and executive officers beneficially owned, in the aggregate, approximately 2.3% of our outstanding common stock as of December 31, 2024.
+Added: Our principal stockholders, if acting together (with or without our directors and executive officers), may have the ability to exert substantial influence over the outcome of matters submitted to our stockholders for approval, including the election and remova l of directors and any merger or sale of all or substantially all of our assets.
In addition, our principal stockholders, if acting together (with or without our directors and executive officers), may have the ability to exert substantial influence over the management and affairs of our company.
4 unchanged sentences
• discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of us.
−Removed: We are an accelerated filer and may no longer provide scaled disclosures as a smaller reporting company beginning with our Quarterly Report on Form 10-Q for the quarter ending March 31, 2024, which will increase our costs and demands on management.
−Removed: We are an accelerated filer and beginning with our Quarterly Report on Form 10-Q for the quarter ending March 31, 2024, we may no longer provide scaled disclosure as a “smaller reporting company” as defined under the Exchange Act.
−Removed: As a smaller reporting company, we had the option to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including, but not limited to, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.
−Removed: In addition, as a non-accelerated filer and smaller reporting company, we previously availed ourselves of the exemption from the requirement that our independent registered public accounting firm attest to the effectiveness of our internal control over financial reporting under Section 404.
−Removed: As an accelerated filer, we may no longer avail ourselves of this exemption.
−Removed: Because our independent registered public accounting firm is required to undertake an assessment of our internal control over financial reporting, the cost of our compliance with Section 404 has correspondingly increased.
−Removed: For so long as we are an accelerated filer, we expect to incur significant expense and devote substantial management effort toward ensuring compliance with Section 404.
−Removed: We may need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge, and it may be difficult to recruit and maintain such personnel.
−Removed: Implementing any appropriate changes to our internal control over financial reporting may require specific compliance training for our directors, officers and employees and take a significant period of time to complete.
−Removed: Such changes may not, however, be effective in maintaining the adequacy of our internal control over financial reporting, and any failure to maintain that adequacy, or consequent inability to produce accurate financial statements or other reports on a timely basis, could increase our operating costs and could materially impair our ability to operate our business.
+Added: We qualify as a smaller reporting company, and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to such companies could make our common stock less attractive to investors.
+Added: We qualify as a “smaller reporting company,” as defined under the Exchange Act, and, for as long as we continue to be a smaller reporting company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies that are not smaller reporting companies.
+Added: In addition, we are a “non-accelerated filer” as defined under the Exchange Act.
+Added: For as long as we continue to be a non-accelerated filer, we are eligible to take advantage of an exemption from the requirement that our independent registered public accounting firm attest to the effectiveness of our internal control over financial reporting under Section 404.
+Added: For this Annual Report on Form 10-K for the year ending December 31, 2024, we are relying on this exemption and have not obtained an attestation from our independent registered public accounting firm.
+Added: Our decision to rely on this exemption may have a detrimental impact on our ability to maintain the adequacy of our internal control over financial reporting, and any failure to maintain adequacy, or inability to produce accurate financial statements or other reports on a timely basis, could increase our operating costs and could materially impair our ability to operate our business.
+Added: As a result of our decision to rely on certain of these disclosure exemptions, the information we provide stockholders will be different than the information that is available with respect to other public companies and some investors may find our shares of common stock less attractive, which may result in a less active trading market for our common stock.
If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud.
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Effective internal control over financial reporting is necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud.
−Removed: Even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm may conclude that there are material weaknesses with respect to our internal controls or the level at which our internal controls are documented, designed, implemented or reviewed.
+Added: Even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm may conclude that there are material weaknesses with respect to our internal controls or the
+Added: level at which our internal controls are documented, designed, implemented or reviewed.
Undetected material weaknesses in our internal controls could lead to financial statement restatements and require us to incur the expense of remediation.
−Removed: In 2022, we transitioned to a new enterprise resource planning system, which we believe will lead to improvements in our internal control over financial reporting.
−Removed: Although we have completed this transition to a new enterprise resource planning system, the full impact of this transition is not yet known.
+Added: We plan to transition to a new enterprise resource planning system in 2025, which we believe will lead to improvements in our internal control over financial reporting;
+Added: however, the full impact of this transition is not yet known.
If, during the evaluation and testing process of our internal controls, we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal control over financial reporting is effective.
4 unchanged sentences
Holders of our Exchangeable Shares are subject to additional risks.
−Removed: Pursuant to the Redomicile Transactions, certain holders of common shares of our predecessor company exchanged their common shares for exchangeable shares (the “Exchangeable Shares”) in the capital of our subsidiary ExchangeCo.
−Removed: (as defined below) Exchangeable Shares are exchangeable at the option of the holder for shares of our common stock.
+Added: Pursuant to the Redomicile Transactions, certain holders of common shares of our predecessor company exchanged their common shares for exchangeable shares (“Exchangeable Shares”) in the capital of our subsidiary Zymeworks ExchangeCo Ltd.
+Added: (“ExchangeCo”).
+Added: Exchangeable Shares are exchangeable at the option of the holder for shares of our common stock.
Exchangeable Shares are subject to additional risks, including:
27 unchanged sentences
Accordingly, both state and federal courts have jurisdiction to hear such claims.
−Removed: To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our amended and restated bylaws provides that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States will be the sole and exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act.
+Added: To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our amended and restated bylaws provide that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States will be the sole and exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act.
Any person or entity purchasing or otherwise acquiring or holding or owning (or continuing to hold or own) any interest in any of our securities shall be deemed to have notice of and consented to the foregoing bylaw provisions.
Although we believe these exclusive forum provisions benefit us by providing increased consistency in the application of Delaware law and federal securities laws in the types of lawsuits to which each applies, the exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum of its choosing for disputes with us or our current or former directors, officers, stockholders or other employees, which may discourage such lawsuits against us and our current and former directors, officers, stockholders and other employees.
−Removed: Our stockholders will not be deemed to have waived its compliance with the federal securities laws and the rules and regulations thereunder as a result of our exclusive forum provisions.
−Removed: The enforceability of similar exclusive forum provisions in other companies’ organizational documents have been challenged in legal proceedings, and, while certain courts have determined these provisions are enforceable, it is possible that a court of law could rule that these types of provisions are inapplicable or unenforceable if they are challenged in a proceeding or otherwise.
+Added: Our stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder as a result of our exclusive forum provisions.
+Added: The enforceability of similar exclusive forum provisions in other companies’ organizational documents have been challenged in legal proceedings, and, while certain courts have determined these provisions are enforceable, it is possible that a court of law
+Added: could rule that these types of provisions are inapplicable or unenforceable if they are challenged in a proceeding or otherwise.
If a court were to find either exclusive forum provision contained in our amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur significant additional costs associated with resolving such action in other jurisdictions, which could harm our financial condition and results of operations.
−Removed: General Risk Factors
−Removed: We are at risk of securities class action litigation.
−Removed: Securities class action litigation has often been brought against companies following a decline in the market price of their securities.
−Removed: This risk is especially relevant for us because biotechnology companies have experienced significant stock price volatility in recent years.
−Removed: If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could materially harm our business.
−Removed: If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
−Removed: The trading market for our common stock will depend on the research and reports that securities or industry analysts publish about us or our business.
−Removed: We do not have any control over these analysts.
−Removed: We cannot assure that analysts will cover us or provide accurate or favorable coverage.
−Removed: If one or more of the analysts who cover us downgrade our stock or change their opinion of our common stock negatively, our stock price would likely decline.
−Removed: If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our stock price or trading volume to decline.
−Removed: Moreover, the research and reports that analysts publish may suggest a price for our common stock that does not fully or accurately reflect the true value of our company.
−Removed: Furthermore, even if such analyst publications are favorable, these reports could have negative consequences for us.
+Added: There can be no assurance that we will repurchase additional shares of our common stock or that we will repurchase shares at favorable prices.
+Added: In August 2024, our board of directors approved the Repurchase Program, pursuant to which we are authorized to repurchase up to $60.0 million of our common stock from time to time through open market transactions, or other means in accordance with Rule 10b5-1 and Rule 10b-18 under the Exchange Act.
+Added: As of December 31, 2024, we have repurchased 2,545,402 shares of our common stock under the Repurchase Program.
+Added: The timing, number of shares repurchased, and prices paid for any additional shares of stock repurchased under this program will depend on general business and market conditions as well as corporate and regulatory limitations, prevailing stock prices, and other considerations.
+Added: Our Repurchase Program may be suspended or discontinued at any time, and does not obligate us to acquire any additional shares of common stock.
+Added: Our ability to make share repurchases will depend upon market conditions, cash balances and future capital requirements, results of operations, financial condition, compliance with applicable legal requirements and other factors that we may deem relevant and which may be beyond our control.
+Added: In addition, we can provide no assurance that we will repurchase stock at favorable prices.
+Added: As a result, there can be no guarantee around the timing of our share repurchases.
+Added: Any failure to repurchase additional shares of stock, a reduction in the frequency of repurchases, or the completion of our Repurchase Program could have a negative effect on our reputation, investor confidence in us and our stock price.
+Added: The existence of our Repurchase Program could cause our stock price to be higher than it otherwise would be and could potentially reduce the market liquidity for our stock.
+Added: Although our Repurchase Program is intended to enhance long-term stockholder value, there is no assurance that it will do so because the market price of our common stock may decline below the levels at which we repurchase shares, and short-term stock price fluctuations could reduce the effectiveness of the program.
+Added: Repurchasing our common stock reduces the amount of cash we have available, and we may fail to realize the anticipated long-term stockholder value of any share repurchase program.
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.