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What changed in C4 Therapeutics, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of C4 Therapeutics, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+464 added−492 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-22)

Top changes in C4 Therapeutics, Inc.'s 2024 10-K

464 paragraphs added · 492 removed · 367 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

163 edited+44 added−83 removed275 unchanged
Biggest changeAccordingly, we believe that CFT7455 has the potential to meaningfully improve outcomes and become an established standard of care for these patients, if approved. CFT1946: Degrading BRAF V600X to Treat Melanoma, Colorectal, and Non-small Cell Lung Cancers We are developing CFT1946, an orally bioavailable degrader of BRAF V600X.
Biggest changeCFT1946: Degrading BRAF V600 Mutant Protein to Treat Melanoma, Colorectal, and Non-small Cell Lung Cancers We are developing CFT1946, an orally bioavailable degrader of BRAF V600 mutant protein, for the treatment of BRAF V600 mutant solid tumors. We selected BRAF V600 mutant protein as a target due to its strong mechanistic rationale, well-defined biology, and unmet need.
This ubiquitination process typically continues until the target protein is tagged with multiple ubiquitins, known as poly-ubiquitination. Once the target protein is poly-ubiquitinated, it is released by the E3 ligase and is then quickly recognized by a proteasome, which is the cell’s recycling plant.
This ubiquitination typically continues until the target protein is tagged with multiple ubiquitins, a process known as poly-ubiquitination. Once the target protein is poly-ubiquitinated, it is released by the E3 ligase and is then quickly recognized by a proteasome, which is the cell’s recycling plant.
Biogen Collaborative Research and License Agreement In December 2018, we entered into a collaborative research and license agreement, or the Biogen Agreement, with Biogen, whereby we agreed to collaborate with Biogen and use our proprietary protein degrader platform to research, develop, and identify small molecule protein degraders.
Biogen Collaborative Research and License Agreement In December 2018, we entered into a collaborative research and license agreement with Biogen, or the Biogen Agreement, whereby we agreed to collaborate with Biogen and use our proprietary protein degrader platform to research, develop, and identify small molecule protein degraders.
The other two patent families covering our BRAF degraders are directed to separate genuses than that covered by the previous two families, and United States and foreign patents claiming priority to these patent applications, if granted and maintained through the payment of all required fees, will expire in 2041 and 2044, respectively, without regard to any possible patent term extensions or adjustments.
The other two patent families covering our BRAF degraders are directed to separate genuses than that covered by the previous families, and United States and foreign patents claiming priority to these patent applications, if granted and maintained through the payment of all required fees, will expire in 2041 and 2044, respectively, without regard to any possible patent term extensions or adjustments.
An MA may be granted to a similar medicinal product to an authorized orphan product in very select cases, such as if: (i) it is established that a similar medicinal product is safer, more effective or otherwise clinically superior to the authorized product; (ii) the MA holder for the authorized orphan product consents to the authorization of the similar medicinal product; or (iii) the MA holder for the authorized orphan product cannot supply enough orphan medicinal product.
An MA may be granted to a similar medicinal product to an authorized orphan product in very select cases, such as if: (i) it is established that a similar medicinal product is safer, more effective or otherwise clinically superior to the authorized orphan product; (ii) the MA holder for the authorized orphan product consents to the authorization of the similar medicinal product; or (iii) the MA holder for the authorized orphan product cannot supply enough orphan medicinal product.
HITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates in some cases, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorneys’ fees and costs associated with pursuing federal civil actions; • The Physician Payments Sunshine Act, enacted as part of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, the ACA, imposed new annual reporting requirements for certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, for certain payments and “transfers of value” provided to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other licensed health care practitioners and teaching hospitals, as well as ownership and investment interests held by such physicians and their immediate family members; and • Analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party-payors, including private insurers, and may be broader in scope than their federal equivalents; state and foreign laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers; state and foreign laws that require drug manufacturers to report information related to drug pricing and payments and other transfers of value to physicians and other healthcare providers and restrict marketing practices or require disclosure of marketing expenditures and pricing information; state and local laws that require the registration of 31 Table of Contents pharmaceutical sales representatives; state and foreign laws that govern the privacy and security of health information in some circumstances.
HITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates in some cases, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorneys’ fees and costs associated with pursuing federal civil actions; • The Physician Payments Sunshine Act, enacted as part of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, the ACA, imposed new annual reporting requirements for certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, for certain payments and “transfers of value” provided to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other licensed health care practitioners and teaching hospitals, as well as ownership and investment interests held by such physicians and their immediate family members; and • Analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party-payors, including private insurers, and may be broader in scope than their federal equivalents; state and foreign laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers; state and foreign laws that require drug manufacturers to report information related to drug pricing and payments and other transfers of value to physicians and other healthcare providers and restrict marketing practices or require disclosure of marketing expenditures and pricing information; state and local laws that require the registration of pharmaceutical sales representatives; state and foreign laws that govern the privacy and security of health information in some circumstances.
Based on the results of our clinical trials, we will work with the FDA to discuss potential expedited development and accelerated approval pathways for our product candidates as applicable. • Continue to focus our internal pipeline on oncology targets that we believe could benefit from a TPD approach.
Based on the results of our clinical trials, we will work with the FDA to discuss potential expedited development and accelerated approval pathways for our product candidates as applicable. • Continue to focus our internal pipeline on targets that we believe could benefit from a TPD approach.
Even if favorable coverage and reimbursement status is attained for one or more products for which a company or its collaborators receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future. 32 Table of Contents Healthcare Reform In the United States and some foreign jurisdictions, there have been, and likely will continue to be, a number of legislative and regulatory changes and proposed changes regarding the healthcare system directed at broadening the availability of healthcare, improving the quality of healthcare and containing or lowering the cost of healthcare.
Even if favorable coverage and reimbursement status is attained for one or more products for which a company or its collaborators receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future. 27 Table of Contents Healthcare Reform In the United States and some foreign jurisdictions, there have been, and likely will continue to be, a number of legislative and regulatory changes and proposed changes regarding the healthcare system directed at broadening the availability of healthcare, improving the quality of healthcare and containing or lowering the cost of healthcare.
In the United States, these laws include, without limitation, state and federal anti-kickback, false claims, physician transparency and patient data privacy and security laws and regulations, including but not limited to those described below. • The federal Anti-Kickback Statute, which prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, paying, receiving or providing any remuneration (including any kickback, bride or certain rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward or in return for, either the referral of an individual for, or the purchase order or recommendation of, any good or service, for which payment may be made, in whole or in part, under a federal healthcare program such as 30 Table of Contents Medicare and Medicaid.
In the United States, these laws include, without limitation, state and federal anti-kickback, false claims, physician transparency and patient data privacy and security laws and regulations, including but not limited to those described below. • The federal Anti-Kickback Statute, which prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, paying, receiving or providing any remuneration (including any kickback, bride or certain rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward or in return for, either the referral of an individual for, or the purchase order or recommendation of, any good or service, for which payment may be made, in whole or in part, under a federal healthcare program such as Medicare and Medicaid.
Once the FDA’s review of the application is complete, the FDA will issue either a Complete Response Letter, or CRL, or approval letter. A CRL indicates that the review cycle of the application is complete, and the application is not ready for approval.
Once the FDA’s review of the application is complete, the FDA will issue either a Complete Response Letter, or CRL, or an approval letter. A CRL indicates that the review cycle of the application is complete, and the application is not ready for approval.
The IRA includes several provisions that could impact our business to varying degrees, including provisions that reduce the out-of-pocket cap for Medicare Part D beneficiaries to $2,000 starting in 2025, impose new manufacturer financial liability on certain drugs in Medicare Part D, allow the United States government to negotiate Medicare Part B and Part D price caps for certain high-cost drugs and biologics without generic or biosimilar competition, require companies to pay rebates to Medicare for certain drug prices that increase faster than inflation, and delay the rebate rule that would limit the fees that pharmacy benefit managers can charge.
The IRA includes several provisions that could impact our business to varying degrees, including provisions that reduce the out-of-pocket cap for Medicare Part D beneficiaries to $2,000 starting in 2025, impose new manufacturer financial liability on certain drugs in Medicare Part D, allow the United States government to negotiate Medicare Part B and Part D price caps for certain high-cost drugs and biologics without generic or biosimilar competition, require companies to pay rebates to Medicare for certain drug prices that increase faster than 28 Table of Contents inflation, and delay the rebate rule that would limit the fees that pharmacy benefit managers can charge.
In preclinical studies, CFT7455 has shown robust activity in MM, peripheral T-cell lymphoma, or PTCL, and mantle cell lymphoma, or MCL, subcutaneous xenograft mouse models, providing preclinical proof of concept. We believe that the differentiated pharmacology of CFT7455, including its high potency, may translate into improved clinical outcomes in each of the indications in which we are pursuing its development.
In preclinical studies, cemsidomide has shown robust activity in MM, peripheral T-cell lymphoma, or PTCL, and mantle cell lymphoma, or MCL, subcutaneous xenograft mouse models, providing preclinical proof of concept. We believe that the differentiated pharmacology of cemsidomide, including its high potency, may translate into improved clinical outcomes in each of the indications in which we are pursuing its development.
Constitutive activation occurs because BRAF V600X mutants are able to signal as a single protein, or a monomer, while wild-type RAF proteins including BRAF and CRAF must form a complex of two proteins, or a dimer, before downstream signaling can occur. This constitutive activation leads to overactivation of the MAPK cell proliferation pathway, causing oncogenic cell proliferation and tumor growth.
Constitutive activation occurs because BRAF V600 mutants are able to signal as a single protein, or a monomer, while wild-type RAF proteins including BRAF and CRAF must form a complex of two proteins, or a dimer, before downstream signaling can occur. This constitutive activation leads to overactivation of the MAPK cell proliferation pathway, causing oncogenic cell proliferation and tumor growth.
We intend to use press releases, our company website, including our Investor Relations website, and our LinkedIn, and Twitter accounts, which are listed below, as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. www.linkedin.com/company/c4-therapeutics-inc . https://twitter.com/C4Therapeutics 35 Table of Contents
We intend to use press releases, our company website, including our Investor Relations website, and our LinkedIn, and Twitter accounts, which are listed below, as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. www.linkedin.com/company/c4-therapeutics-inc . https://twitter.com/C4Therapeutics 30 Table of Contents
Below are four ways in which tumor cells exploit this vulnerability to generate resistance in the presence of first generation BRAF inhibitors. • Increased RTK activity: Enhanced RTK signaling can activate RAS, which can then promote the formation of dimers between drug-bound BRAF V600X and wild-type RAF protein.
Below are four ways in which tumor cells exploit this vulnerability to generate resistance in the presence of first generation BRAF inhibitors. • Increased RTK activity: Enhanced RTK signaling can activate RAS, which can then promote the formation of dimers between drug-bound BRAF V600 and wild-type RAF protein.
Project Optimus will require that developers of oncology drugs implement strategies in ongoing programs to leverage nonclinical and clinical data in dose selection, including the potential need to conduct randomized evaluations of a range of doses in trials, and require that these studies take place as early as possible in the development program.
Project Optimus requires that developers of oncology drugs implement strategies in ongoing programs to leverage nonclinical and clinical data in dose selection, including the potential need to conduct randomized evaluations of a range of doses in trials, and require that these studies take place as early as possible in the development program.
The process required by the FDA before product candidates may be marketed in the United States generally involves the following: • nonclinical laboratory and animal tests that must be conducted in accordance with GLP; • submission to the FDA of an investigational new drug, or IND, application, which must become effective before clinical trials may begin; • approval by an independent institutional review board, or IRB, for each clinical site or centrally before each trial may be initiated; • adequate and well controlled human clinical trials to establish the safety and efficacy of the proposed product candidate for its intended use, performed in accordance with good clinical practices, or GCP; • submission to the FDA of an NDA and payment of user fees; • satisfactory completion of an FDA advisory committee review, if applicable; • pre-approval inspection of manufacturing facilities and selected clinical investigators for their compliance with current good manufacturing practices, or cGMP, and GCP; 22 Table of Contents • satisfactory completion of FDA audits of clinical trial sites to assure compliance with GCP and the integrity of the clinical data; and • FDA review and approval of an NDA to permit commercial marketing for particular indications for use.
The process required by the FDA before product candidates may be marketed in the United States generally involves the following: • nonclinical laboratory and animal tests that must be conducted in accordance with good laboratory practice, or GLP, requirements; • submission to the FDA of an investigational new drug, or IND, application, which must become effective before clinical trials may begin; • approval by an independent institutional review board, or IRB, for each clinical site or centrally before each trial may be initiated; • adequate and well controlled human clinical trials to establish the safety and efficacy of the proposed product candidate for its intended use, performed in accordance with good clinical practices, or GCP, requirements; • submission to the FDA of an NDA and payment of user fees; • satisfactory completion of an FDA advisory committee review, if applicable; • pre-approval inspection of manufacturing facilities and selected clinical investigators for their compliance with current good manufacturing practices, or cGMP, and GCP; • satisfactory completion of FDA audits of clinical trial sites to assure compliance with GCP and the integrity of the clinical data; and • FDA review and approval of an NDA to permit commercial marketing for particular indications for use.
This leads to up regulation of MAPK activity by the non-inhibitor bound wild-type RAF partner as described above. • BRAF V600X splice variant: Conferred by alternative splicing via generation of BRAF V600X isoforms lacking the RAS binding domain, or RBD, encoded by exons 3–5.
This leads to up regulation of MAPK activity by the non-inhibitor bound wild-type RAF partner as described above. • BRAF V600 mutant splice variant: Conferred by alternative splicing via generation of BRAF V600X isoforms lacking the RAS binding domain, or RBD, encoded by exons 3–5.
Failure to comply with the applicable United States requirements at any time during the product development process, approval process or after approval may subject an applicant to a variety of administrative or judicial sanctions, such as the FDA’s refusal to approve a pending NDA, withdrawal of an approval, imposition of a clinical hold, issuance of warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement or civil or criminal penalties.
Failure to comply with the applicable United States requirements at any time during the product development process, approval process or after approval may subject an applicant to a variety of administrative or judicial sanctions, such as the FDA’s refusal to approve a pending NDA, withdrawal of an approval, 17 Table of Contents imposition of a clinical hold, issuance of warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement or civil or criminal penalties.
Marketing Exclusivity The FDA provides periods of non-patent regulatory exclusivity, which provides the holder of an approved NDA limited protection from new competition in the marketplace for the innovation represented by its approved drug for a period of three or five years following the FDA’s approval of the NDA.
U.S. Marketing Exclusivity The FDA provides periods of non-patent regulatory exclusivity, which provides the holder of an approved NDA limited protection from new competition in the marketplace for the innovation represented by its approved drug for a period of three or five years following the FDA’s approval of the NDA.
Under the Food and Drug Omnibus Reform Act of 2022, or FDORA, the FDA is now permitted to require, as appropriate, that these trials be underway prior to approval or within a specific time period after the date of approval for a product granted accelerated approval.
Under the Food and Drug Omnibus Reform Act of 2022, or FDORA, the FDA is now permitted to require that these trials be underway prior to approval or within a specific time period after the date of approval for a product granted accelerated approval.
Under the Orphan Drug Act, the FDA may designate a drug product as an “orphan drug” if it is intended to treat a rare disease or condition (generally meaning that it affects fewer than 200,000 individuals in the United States or more in cases in which there is no reasonable expectation that the cost of developing and making a drug product available in the United States for treatment of the disease or condition will be recovered from sales of the product).
Under the Orphan Drug Act, the FDA may designate a drug product as an “orphan drug” if it is intended to treat a rare disease or condition (generally meaning that it affects fewer than 200,000 individuals in the United States or there is no reasonable expectation that the cost of developing and making a drug product available in the United States for treatment of the disease or condition will be recovered from sales of the product).
The recommended first-line treatment for patients with BRAF V600X mutated unresectable or metastatic melanoma is anti-PD-1 monotherapy, such as pembrolizumab or nivolumab, or combination therapy with a BRAF inhibitor, such as dabrafenib, vemurafenib or encorafenib, and a MEK inhibitor, such as as trametinib, cobimetinib or binimetinib.
The recommended first-line treatment for patients with BRAF V600 mutated unresectable or metastatic melanoma is anti-PD-1 monotherapy, such as pembrolizumab or nivolumab, or combination therapy with a BRAF inhibitor, such as dabrafenib, vemurafenib or encorafenib, and a MEK inhibitor, such as trametinib, cobimetinib or binimetinib.
Violations are subject to civil and criminal fines and penalties for each violation, plus up to three times the remuneration involved, imprisonment, and exclusion from government healthcare programs; • The federal civil and criminal false claims laws, including the civil False Claims Act, or FCA, which prohibit individuals or entities from, among other things, knowingly presenting or causing to be presented, to the federal government, claims for payment or approval that are false, fictitious or fraudulent; knowingly making, using or causing to be made or used a false statement or record material to a false or fraudulent claim or obligation to pay or transmit money or property to the federal government; or knowingly concealing or knowingly and improperly avoiding or decreasing an obligation to pay money to the federal government.
Violations are 25 Table of Contents subject to civil and criminal fines and penalties for each violation, plus up to three times the remuneration involved, imprisonment, and exclusion from government healthcare programs; • The federal civil and criminal false claims laws, including the civil False Claims Act, or FCA, which prohibit individuals or entities from, among other things, knowingly presenting or causing to be presented, to the federal government, claims for payment or approval that are false, fictitious or fraudulent; knowingly making, using or causing to be made or used a false statement or record material to a false or fraudulent claim or obligation to pay or transmit money or property to the federal government; or knowingly concealing or knowingly and improperly avoiding or decreasing an obligation to pay money to the federal government.
Further, since 30-40% of mutant EGFR NSCLC patients develop brain metastases, penetration of the central nervous system sufficient to drive therapeutic effect in this compartment was a key factor in our selection of CFT8919 as our development candidate.
Further, since 30-60% of mutant EGFR NSCLC patients develop brain metastases, penetration of the central nervous system sufficient to drive therapeutic effect in this compartment was a key factor in our selection of CFT8919 as our development candidate.
Human clinical trials are typically conducted in three sequential phases that may overlap or be combined. • Phase 1—Studies are initially conducted to test the product candidate for safety, dosage tolerance, structure-activity relationships, mechanism of action, absorption, metabolism, distribution, and excretion in healthy volunteers or subjects with the target disease or condition.
Human clinical trials are typically conducted in three sequential phases that may overlap or be combined. • Phase 1—Studies are initially conducted to test the product candidate for safety, dosage tolerance, structure-activity relationships, mechanism of action, absorption, metabolism, distribution, and excretion in healthy 18 Table of Contents volunteers or subjects with the target disease or condition.
In November 2020, through the entry into this amendment, we and Roche mutually agreed to terminate the Roche Agreement as to the target EGFR. Further, in November 2021, July 2022, and December 2023, we and Roche mutually agreed to terminate the Roche Agreement as to BRAF as well as two additional undisclosed targets.
In November 2020, through the entry into this amendment, we and Roche mutually agreed to terminate the Roche Agreement as to the target EGFR. Further, in November 2021, July 2022, and December 2023, we and Roche mutually agreed to terminate the Roche Agreement as to BRAF and then two additional undisclosed targets.
Fast track designation provides additional opportunities for interaction with the FDA’s review team and may allow for rolling review of NDA 24 Table of Contents components before the completed application is submitted, if the sponsor provides a schedule for the submission of the sections of the NDA, the FDA agrees to accept sections of the NDA and determines that the schedule is acceptable and the sponsor pays any required user fees upon submission of the first section of the NDA.
Fast track designation provides additional opportunities for interaction with the FDA’s review team and may allow for rolling review of NDA components before the completed application is submitted, if the sponsor provides a schedule for the submission of the sections of the NDA, the FDA agrees to accept sections of the NDA and determines that the schedule is acceptable and the sponsor pays any required user fees upon submission of the first section of the NDA.
The proteasome degrades poly-ubiquitinated proteins into their component amino acids, and these amino acids can then be recycled to form new proteins or can be excreted by the cell. This process is illustrated in the following graphic. Approximately five percent of all human genes are dedicated to encoding components of the ubiquitin-proteasome system.
The proteasome degrades poly-ubiquitinated proteins into their component amino acids, and these amino acids can then be recycled to form new proteins or can be excreted by the cell. This process is illustrated in the following graphic. 2 Table of Contents Approximately five percent of all human genes are dedicated to encoding components of the ubiquitin-proteasome system.
Many cancers are characterized by activating mutations in components of this MAPK pathway, including BRAF V600X mutations, which confer constitutive activation of the MAPK pathway and promote oncogenic transformation and can cause tumor growth.
Many cancers are characterized by activating mutations in components of this MAPK pathway, including BRAF V600 mutations, which confer constitutive activation of the MAPK pathway and promote oncogenic transformation and can cause tumor growth.
If an applicant obtains a marketing authorization in all EU Member States, or a marketing authorization granted in the centralized procedure by the EC, and the study results for the pediatric population are included in the product information, even when negative, the medicine is then eligible for an additional six- 28 Table of Contents month period of qualifying patent protection through extension of the term of any supplementary protection certificate, or SPC, so long as an application for this extension is made at the same time as filing the SPC application for the product, or at any point up to two years before the SPC expires.
If an applicant obtains a marketing authorization in all EU Member States, or a marketing authorization granted through the centralized procedure by the European Commission, or EC, and the study results for the pediatric population are included in the product information, even when negative, the medicine is then eligible for an additional six-month period of qualifying patent protection through extension of the term of any supplementary protection certificate, or SPC, so long as an application for this extension is made at the same time as filing the SPC application for the product, or at any point up to two years before the SPC expires.
The ability of our degraders to repeat this process recursively, with the same single degrader molecule interacting with many copies of the target protein, allows us to optimize our product candidates for catalytic degradation turnover and, as a result, create candidates that have the potential to provide a greater therapeutic effect.
The ability of our degraders to repeat this process recursively, with the same single degrader molecule interacting sequentially with many copies of the target protein, allows us to design our product candidates for catalytic degradation turnover and, as a result, create candidates that have the potential to provide a greater therapeutic effect.
CFT7455: A IKZF1/3 Degrader for Multiple Myeloma and non-Hodgkin's Lymphoma, We are developing CFT7455, an orally bioavailable degrader designed to target IKZF1/3, for the treatment of MM and NHL. We have chosen IKZF1 and IZKF3 as our initial targets for degradation because of their strong mechanistic rationale and well-defined biology.
Cemsidomide: A IKZF1/3 Degrader for Multiple Myeloma and non-Hodgkin's Lymphoma, We are developing cemsidomide, an orally bioavailable degrader designed to target IKZF1/3, for the treatment of MM and NHL. We have chosen IKZF1 and IZKF3 as our targets for degradation because of their strong mechanistic rationale and well-defined biology.
We and Biogen each may terminate the Biogen Agreement (a) with respect to one or more development candidates, products or collaboration targets or, only in the case of Biogen, the entire agreement, for the other party’s uncured material breach of its obligations and (b) in its entirety 16 Table of Contents upon the other party’s bankruptcy, insolvency or similar proceedings.
We and Biogen each may terminate the Biogen Agreement (a) with respect to one or more development candidates, products or collaboration targets or, only in the case of Biogen, the entire agreement, for the other party’s uncured material breach of its obligations and (b) in its entirety upon the other party’s bankruptcy, insolvency or similar proceedings.
On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 into law, which eliminates the statutory Medicaid drug rebate cap, currently set at 100% of a drug’s average manufacturer price, for single source and innovator multiple source drugs, beginning January 1, 2024.
On March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, which eliminates the statutory Medicaid drug rebate cap, currently set at 100% of a drug’s average manufacturer price, for single source and innovator multiple source drugs, beginning January 1, 2024.
Food and Drug Administration, with the milestone amount based on the percentage of patients in contemplated clinical trials that were enrolled by Betta Pharma and the line of therapy of the approval.
Food and Drug Administration, or the FDA, with the milestone amount based on the percentage of patients in contemplated clinical trials that were enrolled by Betta Pharma and the line of therapy of the approval.
In the absence of the RBD, these BRAF isoforms dimerize even in the presence of low levels of RAS activity, Once BRAF V600X dimers form, the inhibitor is only able to block one of the BRAF V600X partners leaving the other unoccupied BRAF V600X partner activated and free to up regulate MAPK activity. • BRAF V600X amplification: Genetic alterations can lead to many additional copies of the BRAF V600X gene – a phenomenon known as gene amplification.
In the absence of the RBD, these BRAF isoforms dimerize even in the presence of low levels of RAS activity, Once BRAF V600 mutant protein dimers form, the inhibitor is only able to block one of the BRAF V600X partners leaving the other unoccupied BRAF V600 mutant protein activated and free to up regulate MAPK activity. • BRAF V600 mutant amplification: Genetic alterations can lead to many additional copies of the BRAF V600 gene – a phenomenon known as gene amplification.
Collaborations and License Agreements Merck License and Collaboration Agreement In December, 2023, we entered into a license and collaboration agreement with Merck, or the Merck License Agreement, to collaborate on the development and commercialization of degrader-antibody conjugates, or DACs, an emerging modality designed to selectively target and neutralize disease-causing proteins in cancer cells.
Merck License and Collaboration Agreement In December, 2023, we entered into a license and collaboration agreement with Merck, or the Merck License Agreement, to collaborate on the development and commercialization of degrader-antibody conjugates, an emerging modality designed to selectively target and neutralize disease-causing proteins in cancer cells.
Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the product candidate, as well as finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements.
Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the product candidate, as well as finalize a process for 19 Table of Contents manufacturing the product in commercial quantities in accordance with cGMP requirements.
Therefore, 4 Table of Contents in contrast to a typical reversible inhibitor, the effect of a degrader can persist well after it has been cleared from the body. The ability of a degrader to eliminate its target completely is another mechanism for improved potency relative to a traditional inhibitor.
Therefore, in contrast to a typical reversible inhibitor, the effect of a degrader can persist well after it has been cleared from the body. The ability of a degrader to eliminate its target completely is another mechanism for improved potency relative to a traditional inhibitor.
We refer to this amended and restated agreement as the Roche Agreement. Under the Roche Agreement, we agreed to collaborate with Roche in the research, development, manufacture, and commercialization of target-binding degrader medicines using our proprietary TORPEDO platform for the treatment of cancers and other indications.
We refer to this amended and restated agreement as the Roche Agreement. 11 Table of Contents Under the Roche Agreement, we agreed to collaborate with Roche in the research, development, manufacture, and commercialization of target-binding degrader medicines using our proprietary TORPEDO platform for the treatment of cancers and other indications.
We and Roche each may terminate the Roche Agreement in its entirety or on a target-by-target or product-by-product basis and, in our case, on a country-by-country basis, for the other party’s uncured material breach of its obligations under the Roche Agreement or upon the other party’s bankruptcy, insolvency or similar proceedings.
We and Roche each may terminate the Roche Agreement in its entirety or on 12 Table of Contents a target-by-target or product-by-product basis and, in our case, on a country-by-country basis, for the other party’s uncured material breach of its obligations under the Roche Agreement or upon the other party’s bankruptcy, insolvency or similar proceedings.
Specifically, this platform portfolio consists of nineteen patent families covering the TORPEDO platform with composition of matter claims directed to various classes of CRBN ligands and degraders derived therefrom, as well as claims to 20 Table of Contents associated methods of use, pharmaceutical compositions, and processes of manufacture.
Specifically, this platform portfolio consists of nineteen patent families covering the TORPEDO platform with composition of matter claims directed to various classes of CRBN ligands and degraders derived therefrom, as well as claims to associated methods of use, pharmaceutical compositions, and processes of manufacture.
Centralized MAs, which are issued by the EC through the centralized procedure, based on the opinion of the Committee for Medicinal Products for Human Use, or CHMP, of the EMA, are valid throughout the EU, and in the additional Member States (Iceland, Liechtenstein and Norway) of the EEA.
Centralized MAs, which are issued by the EC through the centralized procedure, based on the opinion of the Committee for Medicinal Products for Human Use, or CHMP, of the EMA, are valid throughout the EU, and in the additional countries (Iceland, Liechtenstein and Norway) of the EEA.
If new patent applications relating to ongoing collaboration activities are filed in the future, our rights to any such future patent applications will be governed by the Roche Agreement, which is described above. Target Platform Collaborations We work with strategic partners to expand our platform potential, including Roche, Calico, Biogen, and Merck.
If new patent applications relating to ongoing collaboration activities are filed in the future, our rights to any such future patent applications will be governed by the Roche Agreement, which is described above. Target Platform Collaborations We work or have worked with strategic partners to expand our platform potential, including Roche, Calico, Biogen, Merck, and MKDG.
Other companies developing chimeric small molecules for protein degradation include, without limitation, Arvinas, Inc., BioTheryX, Inc., Captor Therapeutics, Inc., Cullgen Inc., Foghorn Therapeutics, Inc., Frontier Medicines Corporation, Glubio Therapeutics, Inc., Haisco Pharmaceutical Group, Kymera Therapeutics, Inc., Monte Rosa Therapeutics, Inc., Nurix Therapeutics, Inc., Orum Therapeutics, Inc., PhoreMost Ltd., Plexium, Inc., Salarius Pharmaceuticals, Inc., Seed Therapeutics, Inc., SK Life Science Labs, Inc..
Other companies developing chimeric small molecules for protein degradation include, without limitation, Arvinas, Inc., BioTheryX, Inc., Captor Therapeutics, Inc., Cullgen Inc., Foghorn Therapeutics, Inc., Frontier Medicines Corporation, 13 Table of Contents Glubio Therapeutics, Inc., Haisco Pharmaceutical Group, Kymera Therapeutics, Inc., Monte Rosa Therapeutics, Inc., Nurix Therapeutics, Inc., Orum Therapeutics, Inc., PhoreMost Ltd., Plexium, Inc., Salarius Pharmaceuticals, Inc., Seed Therapeutics, Inc., SK Life Science Labs, Inc.
Roche is also required to pay us up to $150 million per target in one-time sales-based milestone payments upon 17 Table of Contents the achievement of specified levels of net sales of a product directed to such target.
Roche is also required to pay us up to $150 million per target in one-time sales-based milestone payments upon the achievement of specified levels of net sales of a product directed to such target.
For example, the FDA may require a Risk Evaluation and Mitigation Strategy, or REMS, as a condition of approval or following approval to mitigate any identified or suspected serious risks and ensure safe use of the drug.
For example, the FDA 21 Table of Contents may require a Risk Evaluation and Mitigation Strategy, or REMS, as a condition of approval or following approval to mitigate any identified or suspected serious risks and ensure safe use of the drug.
Pursuant to the terms of the License Agreement, we granted Merck a worldwide, exclusive license under certain of our intellectual property rights to develop, manufacture and commercialize DACs directed to an initial undisclosed oncology target. Merck is responsible for all development, regulatory approval, manufacturing and commercialization costs.
Pursuant to the terms of the License Agreement, we granted Merck a worldwide, exclusive license under certain of our intellectual property rights to develop, manufacture and commercialize degrader-antibody conjugates directed to an initial undisclosed oncology target. Merck is responsible for all development, regulatory approval, manufacturing and commercialization costs.
Upon execution of the Biogen Agreement, Biogen paid us an upfront payment of $45.0 million as prepayment for candidate development activities. Upon Biogen’s receipt of degraders directed to each target that satisfy pre-defined criteria, we are eligible to receive payments ranging from $2.0 million to $5.0 million per target.
Upon execution of the Biogen Agreement, Biogen paid us an upfront payment of $45.0 million as prepayment for candidate development activities. Upon Biogen’s receipt of degraders directed to each target that satisfy pre-defined criteria, we received payments ranging from $2.0 million to $5.0 million per target.
In addition, the FDA may require Phase 4 post-marketing studies to monitor the effectiveness or safety of an approved product and may limit further marketing of the product based on the results of these post-marketing studies. 26 Table of Contents U.S.
In addition, the FDA may require Phase 4 post-marketing studies to monitor the effectiveness or safety of an approved product and may limit further marketing of the product based on the results of these post-marketing studies. U.S.
Three of these patent families include claims directed to compositions of matter generally and specifically covering CFT7455, one of our lead product candidates and associated methods of use, which if issued and maintained through the payment of all required fees, will expire in 2040, 2041, and 2043, respectively, without regard to any possible patent term extensions or adjustments.
Three of these patent families include claims directed to compositions of matter generally and specifically covering cemsidomide, one of our lead product candidates, and associated methods of use, pharmaceutical compositions, and processes of manufacture, which if issued and maintained through the payment of all required fees, will expire in 2040, 2041, and 2043, respectively, without regard to any possible patent term extensions or adjustments.
Under the terms of the Merck License Agreement, Merck has made an upfront cash payment of $10.0 million. For DACs directed to the initial target, we are eligible to receive milestone payments totaling approximately $600 million in aggregate, plus tiered royalties on net sales.
Under the terms of the Merck License Agreement, Merck has made an upfront cash payment of $10.0 million. For degrader-antibody conjugates directed to the initial target, we are eligible to receive milestone payments totaling approximately $600 million in the aggregate, plus tiered royalties on net sales.
In addition, as part of the collaboration, we granted Merck options to obtain worldwide, exclusive licenses under certain of our intellectual property rights to develop, manufacture and commercialize DACs directed to three additional targets, each subject to payment of an option exercise price.
In addition, as part of the collaboration, we granted Merck options to obtain worldwide, exclusive licenses under certain of our intellectual property rights to develop, manufacture and commercialize degrader-antibody conjugates directed to three additional targets, each subject to payment of an option exercise price.
We are evaluating CFT1946 in a variety of BRAF V600X solid tumors, including melanoma, CRC, and NSCLC, where current standard of care BRAF inhibitor for these specific indications are dabrafenib with trametinib for melanoma in the first-line setting with a progression-free survival, or PFS, of 11.4 months, encorafenib with cetuximab for CRC in the second-line letting with a PFS of 4.2 months, and dabrafenib with trametinib for NSCLC in the second-line setting with a PFS of 15.2 months.
We are evaluating CFT1946 in a variety of BRAF V600 mutant solid tumors, including melanoma and CRC, where current standard of care BRAF inhibitor for these specific indications are dabrafenib with trametinib for melanoma in the first-line setting with a progression-free survival, or PFS, of 11.4 months and encorafenib with cetuximab for CRC in the second-line letting with a PFS of 4.2 months.
It is also possible that failure to comply with the FDA’s requirements relating to the promotion of prescription drugs may lead to investigations alleging violations of federal and state healthcare fraud and abuse and other laws, as well as state consumer protection laws. Any of these sanctions could result in adverse publicity, among other adverse consequences. U.S.
It is also possible that failure to comply with the FDA’s requirements relating to the promotion of prescription drugs may lead to investigations alleging violations of federal and state healthcare fraud 22 Table of Contents and abuse and other laws, as well as state consumer protection laws. Any of these sanctions could result in adverse publicity, among other adverse consequences.
As of December 31, 2023, we owned two patent families (one United States patent, two United States patent applications, and fifty foreign patent applications) with claims directed to compositions of matter covering our EGFR degraders, including our CFT8919 product candidate, and associated methods of use, pharmaceutical compositions, and processes of manufacture.
As of December 31, 2024, we owned two patent families (one United States patent, two United States patent applications, one foreign patent, and forty-two foreign patent applications) with claims directed to compositions of matter covering our EGFR degraders, including our CFT8919 product candidate, and associated methods of use, pharmaceutical compositions, and processes of manufacture.
The fourth patent family covering our IKZF1/3 degraders is directed to a separate genus than that covered in the previous three families and, if granted and maintained through the payment of all required fees, will expire in 2039, without regard to any possible patent term extensions or adjustments.
The fourth patent family (comprising one United States patent) covering our IKZF1/3 degraders is directed to a separate genus than that covered in the previous three families and, if maintained through the payment of all required fees, will expire in 2039, without regard to any possible patent term extensions or adjustments.
These competitors also compete with us in 18 Table of Contents recruiting and retaining qualified scientific and management personnel, and establishing clinical trial sites, and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.
These competitors also compete with us in recruiting and retaining qualified scientific and management personnel, and establishing clinical trial sites, and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.
Betta Pharma is responsible for all development, regulatory approval, manufacturing and commercialization costs in Greater China except where Betta Pharma acts as our agent in Greater China in connection with a global trial sponsored by 15 Table of Contents us.
Betta Pharma is responsible for all development, regulatory approval, manufacturing and commercialization costs in Greater China except where Betta Pharma acts as our agent in Greater China in connection with a global trial sponsored by us.
The timeline for first-line cancer indication development programs may also be longer than for indications sought in third-line treatment or beyond due to a desire for regulatory authorities to expedite access to later-line treatments for those whose cancer has progressed despite available and earlier-line treatments.
The timeline for first-line cancer indication development programs may also be longer than for indications sought in the second or later lines of treatment due to a desire for regulatory authorities to expedite access to later-line treatments for those whose cancer has progressed despite available and earlier-line treatments.
The implementation of the IRA is currently subject to ongoing litigation challenging the constitutionality of the IRA’s Medicare drug price negotiation program. The effect of IRA on our business and the healthcare industry in general is not yet known.
The implementation of the IRA is currently subject to ongoing litigation challenging the constitutionality of the IRA’s Medicare drug price negotiation program. The future of the IRA and its impact on our business and the healthcare industry in general is not yet known.
Specifically, as of December 31, 2023, we owned four patent families (two United States patents, three United States patent applications, one PCT patent application, and fifty-four foreign patent applications) presenting composition of matter and pharmaceutical composition claims to compounds that cause the degradation of the IKZF1/3 protein target, as well as associated methods of use to treat cancer and processes of manufacture.
Specifically, as of December 31, 2024, we owned four patent families (two United States patents, three United States patent applications, two foreign patents, and fifty-seven foreign patent applications) presenting composition of matter and pharmaceutical composition claims to compounds that cause the degradation of the IKZF1/3 protein target, as well as associated methods of use to treat cancer and processes of manufacture.
United States and foreign patents claiming priority to these patent applications, if granted and maintained through the payment of all required fees, will expire in 2041 and 2044, respectively, without regard to any possible patent term extensions or adjustments.
United States and foreign patents claiming priority to these patent applications, if granted and maintained through the payment of all required fees, will expire between 2041 and 2045, without regard to any possible patent term extensions or adjustments.
In the EU, the Pediatric Committee, or PDCO of the EMA must approve the pediatric investigation plan, or PIP, prior to the filing of a marketing authorization application, or MAA, unless the EMA has granted (1) a product-specific waiver, (2) a class waiver or (3) a deferral for one or more of the measures included in the PIP.
In the EU, the Pediatric Committee, or PDCO, of the European Medicines Agency, or EMA, must approve the pediatric investigation plan, or PIP, prior to the filing of a marketing authorization application, or MAA, unless the EMA has granted 23 Table of Contents (1) a product-specific waiver, (2) a class waiver or (3) a deferral for one or more of the measures included in the PIP.
The length of the patent term extension is related to the length of time the drug is under regulatory review and diligence during the review process.
The length of the patent term extension is related to 15 Table of Contents the length of time the drug is under regulatory review and diligence during the review process.
Furthermore, fast track designation, breakthrough therapy designation, accelerated approval, and priority review do not change the standards for approval and may not ultimately expedite the development or approval process.
Furthermore, fast track 20 Table of Contents designation, breakthrough therapy designation, accelerated approval, and priority review do not change the standards for approval and may not ultimately expedite the development or approval process.
Unless otherwise required by regulation, PREA does not apply to a drug for an indication for which orphan drug designation has been granted, except that PREA will apply to an original NDA for a new active ingredient that is orphan-designated if the drug is a molecularly 25 Table of Contents targeted cancer product intended for the treatment of an adult cancer and is directed at a molecular target that FDA determines to be substantially relevant to the growth or progression of a pediatric cancer.
PREA generally does not apply to a drug for an indication for which orphan drug designation has been granted, except that PREA will apply to an original NDA for a new active ingredient that is orphan-designated if the drug is a molecularly targeted cancer product intended for the treatment of an adult cancer and is directed at a molecular target that FDA determines to be substantially relevant to the growth or progression of a pediatric cancer.
Further, IKZF1/3 has been previously validated as a target in clinical practice as lenalidomide and pomalidomide primarily target IKZF1/3 as their mechanism of action. Our First-in-Human Phase 1/2 Trial In June 2021, we initiated a first-in-human Phase 1/2 clinical trial for CFT7455. This trial is designed to primarily investigate safety, tolerability, and anti-tumor activity.
Further, IKZF1/3 has been previously validated as a target in clinical practice as lenalidomide and pomalidomide primarily target IKZF1/3 as their mechanism of action. Our First-in-Human Phase 1/2 Trial Our first-in-human Phase 1/2 clinical trial for cemsidomide is designed to primarily investigate safety, tolerability, and anti-tumor activity.
In our CFT7455 clinical program, we are initially focusing on patients with relapsed or refractory MM who have received at least three lines of specified prior therapy, including lenalidomide, pomalidomide, proteasome inhibitors and an anti-CD38 monoclonal antibody, or mAb.
In our cemsidomide dose escalation trial, we are initially focusing on patients with relapsed or refractory MM who have received at least three lines of specified prior therapy, including lenalidomide, pomalidomide, proteasome inhibitors and an anti-CD38 monoclonal antibody, or mAb.
This in turn leads to elevated BRAF V600X protein concentrations. 9 Table of Contents At high concentrations, BRAF V600X proteins will form dimers without the need for upstream RTK or RAS activation.
This in turn leads to elevated BRAF V600X protein concentrations. At high concentrations, BRAF V600 proteins will form dimers without the need for upstream RTK or RAS activation.
We provide our employees with competitive salaries and bonuses, opportunities for equity ownership, development programs that enable continued learning and growth and a robust employment package that promotes well-being across all aspects of their lives, including health care, retirement planning and paid time off.
We provide our employees with competitive salaries and bonuses, opportunities for equity ownership, development programs that enable continued learning and growth and a robust employment package that promotes well-being across all aspects of their lives, including health care, retirement planning and paid time off. As part of our promotion and retention efforts, we also invest in ongoing development.
As of December 31, 2023, we owned two patent families (two United States patent applications and nine foreign patent applications) with claims directed to compositions of matter covering our RET degraders and associated methods of use, pharmaceutical compositions, and processes of manufacture.
As of December 31, 2024, we owned ten patent families (nine United States patent applications, two PCT patent applications, and twenty-two foreign patent applications) with claims directed to compositions of matter covering our BRAF degraders, and associated methods of use, pharmaceutical compositions, and processes of manufacture.
BRAF V600X is a Common and Well Understood Oncogenic Mutation BRAF is one of several protein kinases involved in a signaling cascade to initiate cell proliferation, known as the mitogen-activated protein kinase, or MAPK, pathway. The MAPK pathway conducts extracellular proliferative signals to the nucleus of cells, signaling them to proliferate.
Amino Acid Changes at BRAF V600 are Common and Well Understood Oncogenic Mutations BRAF is one of several protein kinases involved in a signaling cascade to initiate cell proliferation, known as the mitogen-activated protein kinase, or MAPK, pathway. The MAPK pathway conducts extracellular proliferative signals to the nucleus of cells, signaling them to proliferate.
We believe this partnership will enable us to expedite the overall development of CFT8919 in patients with EGFR-driven resistance mutations due to a high prevalence of EGFR L858R driven NSCLC in Greater China, maximizing the number of patients who can potentially benefit from CFT8919.
We believe this partnership will enable us to expedite the overall development of CFT8919 in patients with EGFR-driven resistance mutations due to a high prevalence of EGFR L858R driven NSCLC in Greater China.
European Union Orphan Designation In the EU, the European Commission grants orphan designation in respect of a product, after receiving the opinion of the EMA’s Committee for Orphan Medicinal Products, if its sponsor can establish that: (1) the product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition; (2) either (i) such condition 29 Table of Contents affects no more than five in 10,000 persons in the EU when the application is made, or (ii) it is unlikely that the product, without the benefits derived from orphan status, would generate sufficient return in the EU to justify the necessary investment in its development; and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU, or, if such a method exists, the product would be a significant benefit to those affected by that condition.
European Union Orphan Designation In the EU, the EC grants orphan designation in respect of a product, after receiving the opinion of the EMA’s Committee for Orphan Medicinal Products, if its sponsor can establish that: (1) the product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition; (2) either (i) such condition affects no more than five in 10,000 persons in the EU when the application is made, or (ii) it is unlikely that the product, without the benefits derived from orphan status, would generate sufficient return in the EU to justify the necessary investment in its development; and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU, or, if such a method exists, the product would be a significant benefit to those affected by that condition. 24 Table of Contents In the EU, orphan designation entitles a party to financial incentives such as reduction of fees or fee waivers and 10 years of market exclusivity is granted following the grant of an MA.
Under the terms of the Biogen Agreement, we are responsible for conducting research and development activities for a number of targets selected by Biogen in accordance with a target selection and replacement procedure set forth in the agreement.
Under the terms of the Biogen Agreement, for which the research term ended in June 2023, we were responsible for conducting research and development activities for a number of targets selected by Biogen in accordance with a target selection and replacement procedure set forth in the agreement.
Patents and Patent Applications As of December 31, 2023, in total, we owned seventeen issued United States patents, more than forty United States patent applications (which include provisional and United States utility applications), seven patent applications filed under the Patent Cooperation Treaty, or PCT, and over two hundred fifty patent applications that are pending in foreign countries.
Patents and Patent Applications As of December 31, 2024, in total, we owned twenty-five issued United States patents, more than thirty-five United States patent applications (which include provisional and United States utility applications), five patent applications filed under the Patent Cooperation Treaty, or PCT, nine patents granted in foreign countries, and over two hundred fifty patent applications that are pending in foreign countries.
We believe that a mutant-specific BRAF V600X degrader could offer a significant mechanistic benefit over currently available BRAF inhibitors and could have the potential to confer significant improvements in clinical outcomes.
We believe that a highly selective BRAF V600 mutant protein degrader could offer a significant mechanistic benefit over currently available BRAF inhibitors and could have the potential to offer improvements in clinical outcomes.
Two of these patent families include claims directed to compositions of matter generally and specifically covering CFT1946, our lead BRAF product candidate, and associated methods of use, and United States and foreign patents claiming priority to these patent applications, if granted and maintained through payment of all required fees, will expire in 2042 and 2043, respectively, without regard to any possible patent term extensions or adjustments.
Eight of these patent families include claims directed to compositions of matter generally and specifically covering CFT1946, our lead BRAF product candidate, and associated methods of use, pharmaceutical compositions, and processes of manufacture, and United States and foreign patents claiming priority to these patent applications, which if granted and maintained 16 Table of Contents through payment of all required fees, will expire between 2042 and 2045, without regard to any possible patent term extensions or adjustments.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAs of December 31, 2023, we have four ongoing collaborations involving our research programs: • a collaboration agreement with Roche that we entered into in December 2015, which we amended and restated in December 2018 and further amended periodically thereafter, with collaboration activities ongoing as to two targets; • a collaboration agreement with Calico that we entered into in March 2017, which was extended in respect of one program in September 2021 and the research term of which expired in March 2023; • a collaboration agreement with Biogen that we entered into in December 2018, which was amended in February 2020, with certain research activities on the nominated targets continuing for a period of time beyond the end of the research term in June 2023, as contemplated by the Biogen Agreement; and • a collaboration agreement with Merck that we entered into in December 2023, for the development and commercialization of degrader-antibody conjugates, or DACs, with respect to one initial target, with the option for Merck to add up to three additional targets over a stated period of time.
Biggest changeWe have three ongoing collaborations involving our research programs: • a collaboration agreement with Roche that we entered into in December 2015, which we amended and restated in December 2018 and further amended periodically thereafter, with collaboration activities ongoing as to two targets; • a collaboration agreement with Merck that we entered into in December 2023 for the development and commercialization of degrader-antibody conjugates with respect to one initial target, with the option for Merck to add up to three additional targets over a stated period of time; and 44 Table of Contents • a collaboration agreement with MKDG that we entered into in March 2024 for the development and commercialization of two targeted protein degraders against critical oncogenic proteins that we had progressed within our internal discovery pipeline.
In the United States., no uniform policy for coverage and reimbursement for products exists among third-party payors. Therefore, coverage and reimbursement for our products can differ significantly from payor to payor.
In the United States, no uniform policy for coverage and reimbursement for products exists among third-party payors. Therefore, coverage and reimbursement for our products can differ significantly from payor to payor.
The process for determining whether a payor will provide coverage for a product may be separate from the process for setting the reimbursement rate that the payor will pay for the product. One payor’s determination to provide coverage for a product does not assure that other payors will also provide coverage and reimbursement for the product.
The process for determining whether a payor will provide coverage for a product may be separate from the process for setting the reimbursement rate that the payor will pay for the product. One payor’s determination to provide coverage for a product does not assure that other payors will also provide coverage and reimbursement for the product.
We may experience numerous unforeseen events during or as a result of clinical trials, which could delay or prevent our ability to receive marketing approval or commercialize our product candidates, including: • delays in reaching, or the failure to reach, a consensus with regulators on clinical trial design or the inability to produce acceptable preclinical results to enable entry into human clinical trials; • the supply or quality of our product candidates or other materials necessary to conduct clinical trials may be insufficient or inadequate, including as a result of delays in the testing, validation, manufacturing and delivery of product candidates to the clinical sites by us or by third parties with whom we have contracted to perform certain of those functions; • delays in reaching, or the failure to reach, agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites or CROs; • the failure of regulators or institutional review boards, or IRBs, to authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site; • difficulty in designing clinical trials and in selecting endpoints for diseases that have not been well studied and for which the natural history and course of the disease is poorly understood; • the selection of certain clinical endpoints that may require prolonged periods of clinical observation or analysis of the resulting data; • the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate, participants may drop out of these clinical trials at a higher rate than we anticipate or fail to return for post-treatment follow-up or we may be unable to recruit suitable patients to participate in our clinical trials; • our product candidates may have undesirable side effects or other unexpected characteristics, causing us or our investigators, regulators or IRBs to suspend or terminate our clinical trials; • we may have to suspend or terminate clinical trials of our product candidates for various reasons, including a finding that the participants are being exposed to unacceptable health risks; • the third parties with whom we contract may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • the requirement from regulators or IRBs that we or our investigators suspend or terminate clinical trials for various reasons, including noncompliance with regulatory requirements or unacceptable safety risks; 42 Table of Contents • clinical trials of our product candidates may produce negative or inconclusive results and we may decide, or regulators may require us, to conduct additional clinical trials, modify our development plans as to dose level and/or dose schedule or otherwise, or abandon product development programs; • the cost of clinical trials of our product candidates may be greater than we anticipate; • staffing shortages, including but not limited to the lack of appropriately trained or experienced clinical research associates or medical staff at the institutions where we conduct our clinical trials or the lack of sufficient support personnel at these institutions involved in site contracting and activation, may cause delays or create other challenges to the timely and efficient conduct of our clinical trials; • imposition of a clinical hold by regulatory authorities as a result of a serious adverse event, concerns with a class of product candidates or after an inspection of our clinical trial operations, trial sites or manufacturing facilities; • occurrence of serious adverse events associated with the product candidate that are viewed to outweigh its potential benefits; and • disruptions caused by any global health epidemics, such as the recent COVID-19 pandemic, which may increase the likelihood that we encounter these types of difficulties or cause other delays in initiating, enrolling, conducting, or completing our planned clinical trials.
We may experience numerous unforeseen events during or as a result of clinical trials, which could delay or prevent our ability to receive marketing approval or commercialize our product candidates, including: • delays in reaching, or the failure to reach, a consensus with regulators on clinical trial design or the inability to produce acceptable preclinical results to enable entry into human clinical trials; • the supply or quality of our product candidates or other materials necessary to conduct clinical trials may be insufficient or inadequate, including as a result of delays in the testing, validation, manufacturing and delivery of product candidates to the clinical sites by us or by third parties with whom we have contracted to perform certain of those functions; • delays in reaching, or the failure to reach, agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites or CROs; • the failure of regulators or institutional review boards, or IRBs, to authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site; • difficulty in designing clinical trials and in selecting endpoints for diseases that have not been well studied and for which the natural history and course of the disease is poorly understood; • the selection of certain clinical endpoints that may require prolonged periods of clinical observation or analysis of the resulting data; • the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate, participants may drop out of these clinical trials at a higher rate than we anticipate or fail to return for post-treatment follow-up or we may be unable to recruit suitable patients to participate in our clinical trials; • our product candidates may have undesirable side effects or other unexpected characteristics, causing us or our investigators, regulators or IRBs to suspend or terminate our clinical trials; • we may have to suspend or terminate clinical trials of our product candidates for various reasons, including a finding that the participants are being exposed to unacceptable health risks; • the third parties with whom we contract may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • the requirement from regulators or IRBs that we or our investigators suspend or terminate clinical trials for various reasons, including noncompliance with regulatory requirements or unacceptable safety risks; 37 Table of Contents • clinical trials of our product candidates may produce negative or inconclusive results and we may decide, or regulators may require us, to conduct additional clinical trials, modify our development plans as to dose level and/or dose schedule or otherwise, or abandon product development programs; • the cost of clinical trials of our product candidates may be greater than we anticipate; • staffing shortages, including but not limited to the lack of appropriately trained or experienced clinical research associates or medical staff at the institutions where we conduct our clinical trials or the lack of sufficient support personnel at these institutions involved in site contracting and activation, may cause delays or create other challenges to the timely and efficient conduct of our clinical trials; • imposition of a clinical hold by regulatory authorities as a result of a serious adverse event, concerns with a class of product candidates or after an inspection of our clinical trial operations, trial sites or manufacturing facilities; • occurrence of serious adverse events associated with the product candidate that are viewed to outweigh its potential benefits; and • disruptions caused by any global health epidemics, such as the COVID-19 pandemic, which may increase the likelihood that we encounter these types of difficulties or cause other delays in initiating, enrolling, conducting, or completing our planned clinical trials.
The success of our product candidates will depend on several factors, including the following: • sufficiency of our financial and other resources; • successful initiation of clinical trials; • successful patient enrollment in, and conduct and completion of, clinical trials; • receipt and related terms of marketing approvals from applicable regulatory authorities; • obtaining and maintaining patent or trade secret protection and regulatory exclusivity for our product candidates; • making suitable arrangements with third-party manufacturers for both clinical and commercial supplies of our product candidates; 39 Table of Contents • developing product candidates that achieve the therapeutic properties desired and appropriate for their intended indications; • establishing sales, marketing and distribution capabilities, and launching commercial sales of our products, if and when approved, whether alone or in collaboration with others; • acceptance of our products, if and when approved, by patients, the medical community, and third-party payors; • obtaining and maintaining third-party coverage and adequate reimbursement; • establishing a continued acceptable safety profile of our products and maintaining that profile following approval; • effectively competing with other therapies; and • the skill and success of our third-party collaboration partners in accomplishing any of the aforementioned in the markets in which they are developing our product candidate(s) in a timely manner.
The success of our product candidates will depend on several factors, including the following: • sufficiency of our financial and other resources; • successful initiation of clinical trials; • successful patient enrollment in, and conduct and completion of, clinical trials; • receipt and related terms of marketing approvals from applicable regulatory authorities; • obtaining and maintaining patent or trade secret protection and regulatory exclusivity for our product candidates; • making suitable arrangements with third-party manufacturers for both clinical and commercial supplies of our product candidates; • developing product candidates that achieve the therapeutic properties desired and appropriate for their intended indications; 34 Table of Contents • establishing sales, marketing and distribution capabilities, and launching commercial sales of our products, if and when approved, whether alone or in collaboration with others; • acceptance of our products, if and when approved, by patients, the medical community, and third-party payors; • obtaining and maintaining third-party coverage and adequate reimbursement; • establishing a continued acceptable safety profile of our products and maintaining that profile following approval; • effectively competing with other therapies; and • the skill and success of our third-party collaboration partners in accomplishing any of the aforementioned in the markets in which they are developing our product candidate(s) in a timely manner.
While we have several ongoing clinical trials, at this time, we have not yet completed a clinical trial of any product candidate. As a result, we are only starting to assess the safety of our lead product candidates in patients and we have not yet assessed the safety of any of our other earlier-stage product candidates in humans.
While we have ongoing clinical trials, at this time, we have not yet completed a clinical trial of any product candidate. As a result, we are only starting to assess the safety of our lead product candidates in patients and we have not yet assessed the safety of any of our other earlier-stage product candidates in humans.
Our product candidates could fail to receive or retain marketing approval for many reasons, including the following: • the FDA or foreign regulatory authority, each referred to here as a health authority, may disagree with the design or implementation of our clinical trials; 61 Table of Contents • we may be unable to demonstrate to the satisfaction of the health authority that a product candidate is safe and effective for its proposed indication, or that it is of sufficient strength, identity, or quality in accordance with the health authority's standards; • results of clinical trials may not meet the level of statistical significance required by the health authority for approval; • we may be unable to demonstrate that a product candidate’s clinical and other benefits outweigh its safety risks; • the health authority may disagree with our interpretation of data from preclinical studies or clinical trials; • data collected from clinical trials of our product candidates may not be sufficient valid or of sufficient quality to support the submission of an NDA to the FDA or other submission to a foreign regulatory authority or to obtain marketing approval in the United States or any other country or jurisdiction; • the health authority may find deficiencies with or fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; and • the approval standards, policies, or regulations of a health authority may significantly change in a manner rendering our clinical data insufficient for approval.
Our product candidates could fail to receive or retain marketing approval for many reasons, including the following: • the FDA or foreign regulatory authority, each referred to here as a health authority, may disagree with the design or implementation of our clinical trials; • we may be unable to demonstrate to the satisfaction of the health authority that a product candidate is safe and effective for its proposed indication, or that it is of sufficient strength, identity, or quality in accordance with the health authority's standards; • results of clinical trials may not meet the level of statistical significance required by the health authority for approval; • we may be unable to demonstrate that a product candidate’s clinical and other benefits outweigh its safety risks; • the health authority may disagree with our interpretation of data from preclinical studies or clinical trials; • data collected from clinical trials of our product candidates may not be sufficient valid or of sufficient quality to support the submission of an NDA to the FDA or other submission to a foreign regulatory authority or to obtain marketing approval in the United States or any other country or jurisdiction; • the health authority may find deficiencies with or fail to approve the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; and • the approval standards, policies, or regulations of a health authority may significantly change in a manner rendering our clinical data insufficient for approval.
Patient enrollment in clinical trials is also affected by other factors including: • the severity of the disease under investigation; • the eligibility criteria for the trial in question; • the perceived risks and benefits of the product candidates offered in the clinical trials; • the efforts to facilitate timely enrollment in clinical trials; • the patient referral practices of physicians; • the availability of suitable and sufficient staffing at clinical trial sites; • the burden on patients due to the scope and invasiveness of required procedures under clinical trial protocols, some of which may be inconvenient and/or uncomfortable; • the ability to monitor patients adequately during and after treatment; • the proximity and availability of clinical trial sites for prospective patients; and • the impact of any global health epidemics, such as the recent COVID-19 pandemic, which may affect the conduct of a clinical trial, including by slowing potential enrollment or reducing the number of eligible patients for clinical trials or by interfering with patients’ ability to return to the clinical trial site for required monitoring, procedures, or follow-up.
Patient enrollment in clinical trials is also affected by other factors including: • the severity of the disease under investigation; 40 Table of Contents • the eligibility criteria for the trial in question; • the perceived risks and benefits of the product candidates offered in the clinical trials; • the efforts to facilitate timely enrollment in clinical trials; • the patient referral practices of physicians; • the availability of suitable and sufficient staffing at clinical trial sites; • the burden on patients due to the scope and invasiveness of required procedures under clinical trial protocols, some of which may be inconvenient and/or uncomfortable; • the ability to monitor patients adequately during and after treatment; • the proximity and availability of clinical trial sites for prospective patients; and • the impact of any global health epidemics, such as the recent COVID-19 pandemic, which may affect the conduct of a clinical trial, including by slowing potential enrollment or reducing the number of eligible patients for clinical trials or by interfering with patients’ ability to return to the clinical trial site for required monitoring, procedures, or follow-up.
In addition, if one of our collaborators terminates its agreement with us generally, which they are permitted to do for convenience with between 90 and 270 days’ notice, or with respect to a specific target or in connection with a material breach of the agreement by us that remains uncured for a specified period of time, we may find it more difficult to attract new collaborators and our development programs may be delayed or the perception of us in the business and financial communities could be adversely affected.
In addition, if one of our collaborators terminates its agreement with us generally, which they are permitted to do for convenience with between 60 and 270 days’ notice, or with respect to a specific target or in connection with a material breach of the agreement by us that remains uncured for a specified period of time, we may find it more difficult to attract new collaborators and our development programs may be delayed or the perception of us in the business and financial communities could be adversely affected.
We refer to this provision in our amended and restated by-laws as the Delaware Forum Provision. The Delaware Forum Provision will not apply to any causes of action arising under the Securities Act of 1933, as amended, the Securities Act, or the Exchange Act of 1934, as amended, or the Exchange Act.
We refer to this provision in our amended and restated by-laws as the Delaware Forum Provision. The Delaware Forum Provision will not apply to any causes of action arising under the Securities Act of 1933, as amended, the Securities Act, or the Exchange Act, as amended.
In addition, while receipt of Orphan Drug Designation may result in a waiver of any obligation by FDA to conduct studies in pediatric populations, such waiver may not apply to oncology drugs If a product that has an Orphan Drug Designation subsequently receives the first FDA approval for a particular active ingredient for the disease for which it has such designation, the product is entitled to orphan product exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same indication for seven years, except in limited circumstances such as a showing of clinical superiority to the product with 64 Table of Contents orphan drug exclusivity or if the FDA finds that the holder of the orphan drug exclusivity has not shown that it can assure the availability of sufficient quantities of the orphan drug to meet the needs of patients with the disease or condition for which the drug was designated.
In addition, while receipt of Orphan Drug Designation may result in a waiver of any obligation by FDA to conduct studies in pediatric populations, such waiver may not apply to oncology drugs If a product that has an Orphan Drug Designation subsequently receives the first FDA approval for a particular active ingredient for the disease for which it has such designation, the product is entitled to orphan product exclusivity, which means that the FDA may not approve any other applications, including an NDA, to market the same drug for the same indication for seven years, except in limited circumstances such as a showing of clinical superiority to the product with orphan drug exclusivity or if the FDA finds that the holder of the orphan drug exclusivity has not shown that it can assure the availability of sufficient quantities of the orphan drug to meet the needs of patients with the disease or condition for which the drug was designated.
If the CROs or sites with whom we work do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed in obtaining, marketing approvals for our product candidates and will not be able to, or may be delayed in our efforts to, successfully commercialize our product candidates.
If the CROs or sites with whom we work do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, for any reason, we will not be able to obtain, or may be delayed in obtaining, marketing approvals for our product candidates and will not be able to, or may be delayed in our efforts to, successfully commercialize our product candidates.
We are a clinical stage biotechnology company and, while we have commenced clinical trials of certain of our product candidates, the majority of our other product candidates are still in the discovery stage.
We are a clinical stage biotechnology company and, while we have commenced clinical trials of certain of our product candidates, our other product candidates are still in the discovery stage.
In August 2021, the FDA granted Orphan Drug Designation to CFT7455 for the treatment of MM. We may seek Orphan Drug Designation for one or more of our other current or future product candidates. Regulatory authorities in some jurisdictions, including the United States and the European Union, may designate drugs for relatively small patient populations as orphan drugs.
In August 2021, the FDA granted Orphan Drug Designation to cemsidomide for the treatment of MM. We may seek Orphan Drug Designation for one or more of our other current or future product candidates. Regulatory authorities in some jurisdictions, including the United States and the European Union, may designate drugs for relatively small patient populations as orphan drugs.
As of the end of our fiscal year ended December 31, 2023, we qualified as a “non-accelerated filer” as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act and as a "smaller reporting company." Our compliance with Section 404 necessitates that we incur substantial accounting expense and expend significant management efforts.
As of the end of our fiscal year ended December 31, 2024, we qualified as a “non-accelerated filer” as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act and as a "smaller reporting company." Our compliance with Section 404 necessitates that we incur substantial accounting expense and expend significant management efforts.
The data underlying the feasibility of developing these types of therapeutic products is both preliminary 38 Table of Contents and limited. If any adverse learnings are made by other developers of targeted protein degraders, there is a risk that development of our product candidates could be materially impacted.
The data underlying the feasibility of developing these types of therapeutic products is both preliminary and limited. If any adverse learnings are made by other developers of targeted protein degraders, there is a risk that 33 Table of Contents development of our product candidates could be materially impacted.
Relying on third-party clinical investigators, CROs and consultants may cause us to encounter delays that are outside of our control and, for each of the product candidates that is currently in clinical development, we have engaged a CRO to lead our first-in-human Phase 1/2 clinical trial.
Relying on third-party clinical investigators, CROs and consultants may cause us to encounter delays that are outside of our control and, for each of the product candidates that is currently in clinical development, we have engaged a CRO to lead our first-in-human Phase 1/2 clinical trials.
There can be no assurance that we will be able to negotiate and enter into appropriate contractual arrangements without current or potential future CROs, if and when necessary for our other product candidates, on terms that are acceptable to us on a timely basis or at all.
There can be no assurance that we will be able to negotiate and enter into appropriate contractual arrangements with our current or potential future CROs, if and when necessary for our other product candidates, on terms that are acceptable to us on a timely basis or at all.
Similarly, in the future, w e may form or seek strategic alliances, create joint ventures, or other collaborations or enter into additional licensing arrangements with third parties that we believe will complement or augment our development and commercialization efforts with respect to our product candidates and any future product candidates that we may develop.
Similarly, in the future, we may form or seek strategic alliances, create joint ventures, or other collaborations or enter into additional licensing arrangements with third parties that we believe will complement or augment our development and commercialization efforts with respect to our product candidates and any future product candidates that we may develop.
Our ongoing and planned early-stage clinical trials will be with patients who have received one or more prior treatments and we expect that we would initially seek regulatory approval of our lead product candidates as second-line or 43 Table of Contents third-line therapy.
Our ongoing and planned early-stage clinical trials will be with patients who have received one or more prior treatments and we expect that we would initially seek regulatory approval of our lead product candidates as second-line or 38 Table of Contents third-line therapy.
Any of these occurrences may significantly harm our business, financial condition, and prospects. 41 Table of Contents The conclusions and analysis drawn from announced or published interim top-line and preliminary data from our clinical trials from time to time may change as more patient data become available.
Any of these occurrences may significantly harm our business, financial condition, and prospects. 36 Table of Contents The conclusions and analysis drawn from announced or published interim top-line and preliminary data from our clinical trials from time to time may change as more patient data become available.
Our failure, or the failure of our CMOs, to comply with applicable regulations, including the ability of our CMOs to work with our highly potent materials and the safety protocols in connection therewith, could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of product candidates or products, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supplies of our products.
Our failure, or the failure of our CMOs, to comply with applicable regulations, including the ability of our CMOs to work with our highly potent materials and the safety protocols in connection therewith, could result in sanctions 43 Table of Contents being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of product candidates or products, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supplies of our products.
For example, we may seek to enter into collaboration arrangements to advance our CFT7455 product candidate in MM or other indications or we may form or seek to form collaboration arrangements to enable our development and commercialization of a product candidate in a specified geographic area, as we have done in the case of CFT8919 and our collaboration with Betta Pharma.
For example, we may seek to enter into collaboration arrangements to advance our cemsidomide product candidate in MM or other indications or we may form or seek to form collaboration arrangements to enable our development and commercialization of a product candidate in a specified geographic area, as we have done in the case of CFT8919 and our collaboration with Betta Pharma.
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare and/or impose price controls may adversely affect: • the demand for our product candidates, if we obtain regulatory approval; • our ability to set a price that we believe is fair for our approved products; • our ability to generate revenue and achieve or maintain profitability; • the level of taxes that we are required to pay; and • the availability of capital.
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare and/or impose price controls may adversely affect: • the demand for our product candidates, if we obtain regulatory approval; • our ability to set a price that we believe is fair for our approved products; 63 Table of Contents • our ability to generate revenue and achieve or maintain profitability; • the level of taxes that we are required to pay; and • the availability of capital.
Misconduct by these parties could include, among other things: • intentional, reckless, or negligent conduct or disclosure of unauthorized activities that violate study and trial protocols or the regulations of the FDA or similar foreign regulatory authorities; • violations of healthcare fraud and abuse laws and regulations in the United States and abroad; • violations of U.S. federal securities laws relating to trading in our common stock; and • failures to report financial information or data accurately.
Misconduct by these parties could include, among other things: • intentional, reckless, or negligent conduct or disclosure of unauthorized activities that violate study and trial protocols or the regulations of the FDA or similar foreign regulatory authorities; • violations of healthcare fraud and abuse laws and regulations in the United States and abroad; 68 Table of Contents • violations of U.S. federal securities laws relating to trading in our common stock; and • failures to report financial information or data accurately.
We have only limited technology transfer agreements in place with respect to our product candidates and these existing arrangements do not extend to commercial supply. We acquire many key materials on a purchase order basis. As a result, we do not have long-term committed arrangements with respect to our product candidates and other materials.
We have only limited supply agreements in place with respect to our product candidates and these existing arrangements do not extend to commercial supply. We acquire many key materials on a purchase order basis. As a result, we do not have long-term committed arrangements with respect to our product candidates and other materials.
Any actual or perceived security breach of our platform, systems, and networks could damage our reputation and brand, expose us to a risk of litigation and possible liability, and require us to expend significant capital and other resources to respond to and alleviate problems caused by the security breach.
Any actual or perceived security breach, incident or compromise of our platform, systems, and networks could damage our reputation and brand, expose us to a risk of litigation and possible liability, and require us to expend significant capital and other resources to respond to and alleviate problems caused by the security breach.
If a lawsuit is brought, the FDA is prevented from issuing a final approval of an ANDA for the generic drug until 30 months from our receipt of the generic manufacturer's certification notice, or such shorter or longer time as the presiding court might order based on certain behaviors of the parties, or a final decision of a court holding that our asserted patent claims are invalid, unenforceable, or not infringed.
If a lawsuit is brought, the FDA is prevented from issuing a final approval of an ANDA for the generic drug until 30 months from our receipt of the generic manufacturer's certification notice, or such 52 Table of Contents shorter or longer time as the presiding court might order based on certain behaviors of the parties, or a final decision of a court holding that our asserted patent claims are invalid, unenforceable, or not infringed.
We have obtained Orphan Drug Designation for CFT7455, and if we decide to seek Orphan Drug Designation for any other current or future product candidates, we may be unsuccessful or may be unable to maintain the benefits associated with Orphan Drug Designation, including the potential for supplemental market exclusivity.
We have obtained Orphan Drug Designation for cemsidomide, and if we decide to seek Orphan Drug Designation for any other current or future product candidates, we may be unsuccessful or may be unable to maintain the benefits associated with Orphan Drug Designation, including the potential for supplemental market exclusivity.
These anti-takeover provisions and other provisions in our amended and restated certificate of 75 Table of Contents incorporation and amended and restated by-laws could make it more difficult for stockholders or potential acquirers to obtain control of our board of directors or initiate actions that are opposed by the then-current board of directors and could also delay or impede a merger, tender offer, or proxy contest involving our company.
These anti-takeover provisions and other provisions in our amended and restated certificate of incorporation and amended and restated by-laws could make it more difficult for stockholders or potential acquirers to obtain control of our board of directors or initiate actions that are opposed by the then-current board of directors and could also delay or impede a merger, tender offer, or proxy contest involving our company.
Further, our collaborators may own or co-own intellectual property covering our products that results from our collaborating with them and, in cases where that applies, we would not have the exclusive right to commercialize the collaboration intellectual property.
Further, our collaborators may own or co-own intellectual property covering our products that result from our collaborating with them and, in cases where that applies, we would not have the exclusive right to commercialize the collaboration intellectual property.
We cannot eliminate the risk of contamination or injury from these materials, which could cause an interruption of our commercialization efforts, research and development efforts and business operations, environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling, and disposal of these materials and specified waste products.
We cannot eliminate the risk of contamination or injury from these materials, which could cause an interruption of our commercialization efforts, research and development efforts and business operations, environmental damage resulting in costly clean-up and liabilities under 66 Table of Contents applicable laws and regulations governing the use, storage, handling, and disposal of these materials and specified waste products.
Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or 36 Table of Contents annual basis. Our failure to become and remain profitable would depress the value of our company and could impair our ability to raise capital, maintain our research and development efforts, expand our business or continue operations.
Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to become and remain profitable would depress the value of our company and could impair our ability to raise capital, maintain our research and development efforts, expand our business or continue operations.
In the United States, receipt of an Orphan Drug Designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers. After the FDA grants Orphan Drug Designation, the generic identity of the drug and its potential orphan use are disclosed publicly by the FDA.
In the United States, receipt of an Orphan Drug Designation entitles a party to financial 59 Table of Contents incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and user-fee waivers. After the FDA grants Orphan Drug Designation, the generic identity of the drug and its potential orphan use are disclosed publicly by the FDA.
In addition, while it is our policy to require our employees, consultants, and contractors who may be involved in the development of intellectual property to execute agreements assigning any resulting intellectual property to us, we may be unsuccessful in executing an agreement to that effect with each party who in fact develops intellectual property that we regard as our own.
In addition, while it is our policy to require our employees, consultants, and contractors who may be involved in the development of intellectual property to execute agreements assigning any resulting intellectual property to us, we may be 54 Table of Contents unsuccessful in executing an agreement to that effect with each party who in fact develops intellectual property that we regard as our own.
Referred to as the “pediatric exclusivity provision,” this law provides an additional six months of non-patent exclusivity to pharmaceutical manufacturers that conduct acceptable pediatric studies of new and currently-marketed drug products for which pediatric data would be beneficial pursuant to a written request by the FDA.
Referred to as the “pediatric exclusivity provision,” this law provides an additional six months of non-patent exclusivity to pharmaceutical manufacturers that conduct acceptable pediatric studies of new and currently-marketed drug products for 60 Table of Contents which pediatric data would be beneficial pursuant to a written request by the FDA.
The stock market in general, and the market for smaller biopharmaceutical companies in particular, have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, you may not be able to sell your common stock at or above the price at which you acquired it.
The stock market in general, and the market for smaller biopharmaceutical companies in particular, have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, you may not be able to sell your common 69 Table of Contents stock at or above the price at which you acquired it.
If we are unable to advance to clinical development, develop, obtain regulatory approval for and commercialize our product candidates or experience significant delays in doing so, our business may be materially harmed. We are a clinical-stage biotechnology company and, while we have several ongoing clinical trials, the majority of our other product candidates are currently in the discovery stage.
If we are unable to advance to clinical development, develop, obtain regulatory approval for and commercialize our product candidates or experience significant delays in doing so, our business may be materially harmed. We are a clinical-stage biotechnology company and, while we have ongoing clinical trials, our other product candidates are currently in the discovery stage.
If any of our trade secrets were to be disclosed to or independently developed by a competitor, our competitive position would be harmed. We only have limited geographical protection with respect to certain of our patents and we may not be able to protect our intellectual property rights throughout the world.
If any of our trade secrets were to be disclosed to or independently developed by a competitor, our competitive position would be harmed. 55 Table of Contents We only have limited geographical protection with respect to certain of our patents and we may not be able to protect our intellectual property rights throughout the world.
For example, due to observed safety signals, we previously modified the dosing schedule in our ongoing Phase 1/2 clinical trial of CFT7455 as we continue to advance this clinical trial.
For example, due to observed safety signals, we previously modified the dosing schedule in our ongoing Phase 1/2 clinical trial of cemsidomide as we continue to advance this clinical trial.
Additionally, our existing partners may decide to acquire or partner with other companies developing targeted protein degraders or directed at the targets or indications to which our product candidates are directed, which may have an adverse impact on our business prospects, financial condition and results of operations.
Additionally, our existing partners may decide to acquire or partner with other companies developing targeted protein degraders or directed at the 45 Table of Contents targets or indications to which our product candidates are directed, which may have an adverse impact on our business prospects, financial condition and results of operations.
Government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications. Increasingly, government authorities and third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products.
Government authorities and third-party payors have attempted to control costs by limiting coverage and the amount of reimbursement for particular medications. Increasingly, government authorities and third-party payors are requiring that drug companies provide them with predetermined discounts from list 47 Table of Contents prices and are challenging the prices charged for medical products.
It is also possible that our collaborators may not properly obtain, maintain, enforce, or defend the intellectual property or proprietary rights arising out of our licensed programs or may use our proprietary information in a way that could jeopardize or invalidate our proprietary information or expose us to potential litigation.
It is also possible that our current and past collaborators may not properly obtain, maintain, enforce, or defend the intellectual property or proprietary rights arising out of our licensed programs or may use our proprietary information in a way that could jeopardize or invalidate our proprietary information or expose us to potential litigation.
Our internal computer systems, or those of any of our collaborators, vendors, contractors, or consultants, may fail or suffer security breaches, which could result in a material disruption of our product development programs and could harm our reputation or subject us to liability, and adversely affect our business and financial results.
Our internal computer systems, or those of any of our collaborators, vendors, contractors, or consultants, may fail or suffer security breaches, incidents or compromises, which could result in a disruption of our product development programs and could harm our reputation or subject us to liability, and adversely affect our business and financial results.
However, there many not be enough liquidity in such market to enable you to sell your shares of our common stock. Currently, our common stock is listed on The Nasdaq Global Select Market. If an active trading market for our shares is not sustained, you may not be able to sell your shares quickly or at the market price.
However, there may not be enough liquidity in that market to enable you to sell your shares of our common stock. Currently, our common stock is listed on the Nasdaq Global Select Market. If an active trading market for our shares is not sustained, you may not be able to sell your shares quickly or at the market price.
Ltd., BioTheryX, Inc., Boehringer Ingelheim International GmbH, Bristol Myers Squibb Company (and its subsidiary Celgene Corporation), Captor Therapeutics Inc., Cullgen Inc., the Dana-Farber Cancer Institute and its Center for Protein Degradation, Dialectic Therapeutics, Inc., Foghorn Therapeutics, Inc., Frontier Medicines Corporation, GlaxoSmithKline PLC, Genentech, Inc., Glubio Therapeutics, Inc., Hinova Pharmaceuticals, Inc., Janssen Biotech, Inc., Kymera Therapeutics, Inc., Monte Rosa Therapeutics, Inc., Novartis International AG, Nurix Therapeutics, Inc., Orum Thereapeutic, Inc., Otsuka Pharmaceuticals, Inc., Phoremost, Ltd., Plexium, Inc., Prelude Therapeutics, Inc., Inc., Roche AG, Salarius Pharmaceuticals Inc., Salarius Pharmaceuticals, Inc., Seed Therapeutics, Inc., Sichuan Haisco Pharmaceutical Co., Ltd., SK Life Science Labs, Inc.
Ltd., BioTheryX, Inc., Boehringer Ingelheim International GmbH, Bristol Myers Squibb Company (and its subsidiary Celgene Corporation), Captor Therapeutics Inc., Cullgen Inc., the Dana-Farber Cancer 51 Table of Contents Institute and its Center for Protein Degradation, Dialectic Therapeutics, Inc., Foghorn Therapeutics, Inc., Frontier Medicines Corporation, GlaxoSmithKline PLC, Genentech, Inc., Glubio Therapeutics, Inc., Hinova Pharmaceuticals, Inc., Janssen Biotech, Inc., Kymera Therapeutics, Inc., Monte Rosa Therapeutics, Inc., Novartis International AG, Nurix Therapeutics, Inc., Orum Therapeutics, Inc., Otsuka Pharmaceuticals, Inc., PhoreMost, Ltd., Plexium, Inc., Prelude Therapeutics, Inc., Inc., Roche AG, Salarius Pharmaceuticals Inc., Salarius Pharmaceuticals, Inc., Seed Therapeutics, Inc., Sichuan Haisco Pharmaceutical Co., Ltd., SK Life Science Labs, Inc.
As a result, we cannot provide any 56 Table of Contents assurance that a third party practicing in the general area of our technology will not present or has not presented a patent claim that covers one or more of our product candidates or products or their methods of use or manufacture.
As a result, we cannot provide any assurance that a third party practicing in the general area of our technology will not present or has not presented a patent claim that covers one or more of our product candidates or products or their methods of use or manufacture.
In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a substantial 59 Table of Contents adverse effect on the price of our common stock.
In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock.
For product candidates that have been 63 Table of Contents designated as Breakthrough Therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens.
For product candidates that have been designated as Breakthrough Therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens.
In the future, we may engage third parties for clinical trials outside of the United 71 Table of Contents States, to sell our products abroad once we enter a commercialization phase and/or to obtain necessary permits, licenses, patent registrations, and other regulatory approvals.
In the future, we may engage third parties for clinical trials outside of the United States, to sell our products abroad once we enter a commercialization phase and/or to obtain necessary permits, licenses, patent registrations, and other regulatory approvals.
Our current cash, cash equivalents, and marketable securities will not be sufficient for us to fund any of our product candidates through regulatory approval. As a result, we will need to raise substantial additional capital to complete the 37 Table of Contents development and commercialization of our product candidates.
Our current cash, cash equivalents, and marketable securities will not be sufficient for us to fund any of our product candidates through regulatory approval. As a result, we will need to raise substantial additional capital to complete the development and commercialization of our product candidates.
We may also determine that it is necessary to settle these types of lawsuits in a manner that allows the generic company to enter our 57 Table of Contents market prior to the expiration of our patent or otherwise in a manner that adversely affects the strength, validity or enforceability of our patents.
We may also determine that it is necessary to settle these types of lawsuits in a manner that allows the generic company to enter our market prior to the expiration of our patent or otherwise in a manner that adversely affects the strength, validity or enforceability of our patents.
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 and we may not achieve or sustain profitability.
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 and we may not achieve or sustain profitability. In addition, the U.S.
Identifying potential product candidates and conducting preclinical studies and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete. We may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In addition, our product candidates, if approved, may not achieve commercial success.
Identifying potential product candidates and conducting preclinical studies and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete. We may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In 32 Table of Contents addition, our product candidates, if approved, may not achieve commercial success.
In addition, some of our competitors have ongoing clinical trials for product candidates that treat the same indications as our product candidates and, as a result, patients who would be eligible for our clinical trials may instead elect to enroll in 45 Table of Contents clinical trials of our competitors’ product candidates.
In addition, some of our competitors have ongoing clinical trials for product candidates that treat the same indications as our product candidates and, as a result, patients who would be eligible for our clinical trials may instead elect to enroll in clinical trials of our competitors’ product candidates.
The first-to-file 54 Table of Contents provision of the Leahy-Smith Act requires us to act promptly during the period from invention to filing of a patent application, as there is always a risk that a third party could file a patent application that could be blocking to our patent filings.
The first-to-file provision of the Leahy-Smith Act requires us to act promptly during the period from invention to filing of a patent application, as there is always a risk that a third party could file a patent application that could be blocking to our patent filings.
No prediction can be made as to the effect, if any, that future sales of common stock or the availability of common stock for future sales will have on the trading price of our common stock. 73 Table of Contents Currently, our common stock is listed on The Nasdaq Global Select Market.
No prediction can be made as to the effect, if any, that future sales of common stock or the availability of common stock for future sales will have on the trading price of our common stock. Currently, our common stock is listed on the Nasdaq Global Select Market.
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 we will incur or when, if ever, we will be able to achieve profitability.
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 we will incur or when, if ever, we will be able to achieve 31 Table of Contents profitability.
The amount of time required to obtain approval by the FDA and foreign regulatory authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities.
The amount of time required to obtain approval by the FDA and foreign regulatory authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including 56 Table of Contents the substantial discretion of the regulatory authorities.
This concentration of ownership control may: • delay, defer, or prevent a change in control; • entrench our management and the board of directors; or • impede a merger, consolidation, takeover, or other business combination involving us that other stockholders may desire.
This concentration of ownership control may: • delay, defer, or prevent a change in control; 70 Table of Contents • entrench our management and the board of directors; or • impede a merger, consolidation, takeover, or other business combination involving us that other stockholders may desire.
Preclinical and clinical data are often susceptible to varying interpretations and analyses and many companies that have believed their product candidates performed satisfactorily in 40 Table of Contents preclinical studies and clinical trials have nonetheless failed to obtain marketing approval of their products.
Preclinical and clinical data are often susceptible to varying interpretations and analyses and many companies that have believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain marketing approval of their products.
Competitors may use our and our licensors’ technologies in jurisdictions where we have not obtained patent protection or licensed patents to develop their own products and, further, may export otherwise infringing products to territories where we and our licensors have patent protection, but enforcement is not as strong as that in the United States or 60 Table of Contents the European Union.
Competitors may use our and our licensors’ technologies in jurisdictions where we have not obtained patent protection or licensed patents to develop their own products and, further, may export otherwise infringing products to territories where we and our licensors have patent protection, but enforcement is not as strong as that in the United States or the European Union.
The length of the patent term extension is typically calculated as one-half of the clinical trial period plus the entire period of time during the review of the NDA by the FDA, minus any time of delay by us during these periods.
The length of the patent term extension is typically calculated as one-half of the clinical trial period plus the entire period of time during the review of the NDA by the FDA, minus any time 53 Table of Contents of delay by us during these periods.
We may seek Breakthrough Therapy designation for some or all of our current and future product candidates, including CFT7455 and CFT1946.
We may seek Breakthrough Therapy designation for some or all of our current and future product candidates, including cemsidomide and CFT1946.
The GDPR may increase our responsibility and liability in relation to personal data that we process where that processing is subject to the GDPR. In 69 Table of Contents addition, we may be required to put in place additional mechanisms to ensure compliance with the GDPR, including GDPR requirements as implemented by individual countries.
The GDPR may increase our responsibility and liability in relation to personal data that we process where that processing is subject to the GDPR. In addition, we may be required to put in place additional mechanisms to ensure compliance with the GDPR, including GDPR requirements as implemented by individual countries.
If coverage and adequate reimbursement are not available or reimbursement is available only to limited levels, we may not be able to successfully commercialize any product candidate for which we obtain marketing approval. 52 Table of Contents There may be significant delays in obtaining coverage and reimbursement for newly approved drugs.
If coverage and adequate reimbursement are not available or reimbursement is available only to limited levels, we may not be able to successfully commercialize any product candidate for which we obtain marketing approval. There may be significant delays in obtaining coverage and reimbursement for newly approved drugs.
Under the Food and Drug Omnibus Reform Act, commonly referred to as FDORA, the FDA is permitted to require, as appropriate, that a post-approval confirmatory study or studies be underway prior to approval or within a specified time period after the date of approval for a product that is granted accelerated approval.
Under the Food and Drug Omnibus Reform Act, commonly referred to as FDORA, the FDA is permitted to require that a post-approval confirmatory study or studies be underway prior to approval or within a specified time period after the date accelerated approval is granted.
There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable 67 Table of Contents reimbursement and pricing arrangements for any of our product candidates.
There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any of our product candidates.
However, as a "smaller reporting company," we will not be required to include an attestation report on internal control over financial reporting issued by our independent registered public accounting firm until we are no longer a smaller reporting company.
However, as a "smaller reporting company," we will not be required to include an 71 Table of Contents attestation report on internal control over financial reporting issued by our independent registered public accounting firm until we are no longer a smaller reporting company.
In addition, our amended and restated by-laws provide that any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock is deemed to have notice of and consented to the Delaware Forum Provision and the Federal Forum Provision.
We refer to this provision in our amended and restated by-laws as the Federal Forum Provision. In addition, our amended and restated by-laws provide that any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock is deemed to have notice of and consented to the Delaware Forum Provision and the Federal Forum Provision.
We commenced operations in late 2015 and our activities to date have been limited to organizing and staffing our company, business planning, raising capital, conducting discovery and research activities, filing patent applications, identifying potential product candidates, developing and advancing our TORPEDO platform, undertaking preclinical studies, establishing arrangements with third parties for the manufacture of initial quantities of our product candidates, and preparing for and conducting early-stage clinical trials.
Our activities to date have been limited to organizing and staffing our company, business planning, raising capital, conducting discovery and research activities, filing patent applications, identifying potential product candidates, developing and advancing our TORPEDO platform, undertaking preclinical studies, establishing arrangements with third parties for the manufacture of initial quantities of our product candidates, and preparing for and conducting early-stage clinical trials.
In addition, as we did in our collaboration agreement with Merck, we may seek to enter into collaboration agreements that enable other companies to access and leverage our TORPEDO platform to develop medicines directed at targets selected by our collaboration partners.
In addition, as we did in our more recent collaboration agreements with Merck and MKDG, we may seek to enter into collaboration agreements that enable other companies to access and leverage our TORPEDO platform to develop medicines directed at targets selected by our collaboration partners.
In addition, we may be required to conduct 62 Table of Contents post-approval studies in special populations that are difficult to conduct or complete. We will also be subject to continued compliance with cGMP and GCP requirements for any clinical trials that we conduct post-approval.
In addition, we may be required to conduct post-approval studies in special populations that are difficult to conduct or complete. We will also be subject to continued compliance with cGMP and GCP requirements for any clinical trials that we conduct post-approval.
To the extent that any disruption or security breach were to result in a loss of or damage to our data or applications or 72 Table of Contents the inappropriate disclosure of confidential or proprietary information, we could incur liability, our competitive position could be harmed, and the further development and commercialization of our product candidates could be delayed.
To the extent that any disruption, security breach, incident or compromise were to result in a loss of or damage to our data or applications or the inappropriate disclosure of confidential or proprietary information, we could incur liability, our competitive position could be harmed, and the further development and commercialization of our product candidates could be delayed.
Our business may be materially adversely affected if legislative or administrative changes to immigration or visa laws and regulations impair our hiring processes and goals or projects involving personnel who are not U.S. citizens.
Our 67 Table of Contents business may be materially adversely affected if legislative or administrative changes to immigration or visa laws and regulations impair our hiring processes and goals or projects involving personnel who are not U.S. citizens.
In the past, following periods of volatility in the market price of a company’s securities, securities 74 Table of Contents class-action litigation often has been instituted against that company.
In the past, following periods of volatility in the market price of a company’s securities, securities class-action litigation often has been instituted against that company.
We expect to incur losses over at least the next several years and may never achieve or maintain profitability. We are a clinical-stage biopharmaceutical company with limited operating history. Our net loss was $132.5 million and $128.2 million for the years ended December 31, 2023 and 2022, respectively.
We expect to incur losses over at least the next several years and may never achieve or maintain profitability. We are a clinical-stage biopharmaceutical company with limited operating history. Our net loss was $105.3 million and $132.5 million for the years ended December 31, 2024 and 2023, respectively.
However, even if we received a written request for pediatric studies from the FDA for one or more of our drug products, we may determine not to or be unable to carry out pediatric studies that comply with Section 505(A) of the FDC Act, or we may carry out studies 65 Table of Contents that are not accepted by the FDA for this purpose.
However, even if we received a written request for pediatric studies from the FDA for one or more of our drug products, we may determine not to or be unable to carry out pediatric studies that comply with Section 505(A) of the FDCA, or we may carry out studies that are not accepted by the FDA for this purpose.
While we have commenced clinical trials of several product candidates, and anticipate the commencement of a clinical trial of CFT8919 through our partner Betta Pharma, all of our other product candidates are still in the discovery stage at this time, which means that we have not yet evaluated any of our other product candidates in human clinical trials.
While we have commenced clinical trials of several product candidates and our partner Betta Pharma has commenced a clinical trial of another of our product candidates, all of our other product candidates are still in the discovery stage at this time, which means that we have not yet evaluated any of our other product candidates in human clinical trials.
Further, the UK government has introduced a Data Protection and Digital Information Bill, or the UK Bill, into the UK legislative process. The aim of the UK Bill is to reform the UK’s data protection regime following Brexit.
Further, the UK government has introduced a Data (Use and Access) Bill, or the UK Bill, into the UK legislative process. The aim of the UK Bill is to reform the UK’s data protection regime following Brexit.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeCurrently, the Director of Information Technology role is held by an individual who has over 17 years of cybersecurity, information technology, and systems engineering experience. The Director of Information Technology reports to the Chief People Officer.
Biggest changeThe Director of Information Technology has primary responsibility for day-to-day management of our cyber risk management program, including monitoring for cybersecurity risks. Currently, the Director of Information Technology role is held by an individual who has over 18 years of cybersecurity, information technology, and systems engineering experience. The Director of Information Technology reports to the Chief People Officer.
The Director of Information Technology, working with the Chief Legal Officer and Chief People Officer, provides periodic reports to the audit committee, which is responsible for reviewing and overseeing the Company’s risk management processes, including cybersecurity risks.
The Director of Information Technology, working with the Chief Legal Officer and Chief People Officer, provides periodic reports on cybersecurity risks to the audit committee, which is responsible for reviewing and overseeing the Company’s risk management processes, including cybersecurity risks.
Governance Related to Cybersecurity Risks 78 Table of Contents Our cyber risk management program and related operations and processes are managed by our Director of Information Technology, in consultation with the legal and human resources teams.
For more information, please see the section entitled “Risk Factors” in this Annual Report on Form 10-K. Governance Related to Cybersecurity Risks Our cyber risk management program and related operations and processes are managed by our Director of Information Technology, in consultation with the legal and human resources teams.
Added
Although risks from cybersecurity threats to date have not materially affected, and we do not believe they are reasonably likely to materially affect, us, our business strategy, results of operations or financial condition, we do, from time to time, experience threats and security incidents relating to our, and our third party vendors’, information systems.
Added
Further, in accordance with the committee's charter, the chair of the audit committee provides periodic updates on committee activities to the full board of directors, which may include discussion of any cyber risks.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeRegardless of the outcome, litigation can have a material adverse effect on us because of defense and settlement costs, diversion of management resources, and other factors. Item 4. Mine Safety Disclosures. Not applicable. 79 Table of Contents PART II
Biggest changeRegardless of the outcome, litigation can have a material adverse effect on us because of defense and settlement costs, diversion of management resources, and other factors. 74 Table of Contents Item 4. Mine Safety Disclosures. Not applicable. 75 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeSecurities authorized for issuance under equity compensation plans Information about our equity compensation plans is incorporated herein by reference to Item 12, Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters , of this Annual Report on Form 10-K. Recent sales of unregistered securities None.
Biggest changeSecurities authorized for issuance under equity compensation plans Information about our equity compensation plans is incorporated herein by reference to Item 12, Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters , of this Annual Report on Form 10-K.
Purchases of equity securities by the issuer or affiliated purchasers Neither we nor any affiliated purchaser or anyone acting on our behalf or on behalf of an affiliated purchaser made any purchases of shares of our common stock during the year ended December 31, 2023. Item 6. [Reserved] Not applicable.
Purchases of equity securities by the issuer or affiliated purchasers Neither we nor any affiliated purchaser or anyone acting on our behalf or on behalf of an affiliated purchaser made any purchases of shares of our common stock during the year ended December 31, 2024. Item 6. [Reserved] Not applicable.
Holders As of February 15, 2023, there were approximately 60 holders of record of our common stock. This number does not include beneficial owners whose shares are held by nominees in street name. Dividends We have not declared or paid any cash dividends on our capital stock since our inception.
Holders As of December 31, 2024, there were approximately 76 holders of record of our common stock. This number does not include beneficial owners whose shares are held by nominees in street name. Dividends We have not declared or paid any cash dividends on our capital stock since our inception.
Added
Recent sales of unregistered securities On April 29, 2024, the Company granted a newly hired employee, via an inducement award, an option to purchase 146,880 shares of the Company's common stock in a transaction exempt from registration under Section 4(a)(2) of the Securities Act.
Added
This award was granted as a material inducement to this employee's entering into employment with the Company in accordance with Nasdaq Listing Rule 5635(c)(4). The Company received no cash proceeds and no commissions were paid to any person in connection with the issuance of this award.
Added
On October 28, 2024, the Company granted a newly hired employee, via an inducement award, an option to purchase 345,600 shares of the Company's common stock in a transaction exempt from registration under Section 4(a)(2) of the Securities Act.
Added
This award was granted as a material inducement to this employee's entering into employment with the Company in accordance with Nasdaq Listing Rule 5635(c)(4). The Company received no cash proceeds and no commissions were paid to any person in connection with the issuance of this award.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeResults of operations Comparison of years ended December 31, 2023 and 2022 Revenue 82 Table of Contents Revenue from our collaboration and license agreements consisted of the following (in thousands): Years Ended December 31, 2023 2022 Revenue from collaboration agreements: Biogen Agreement $ 10,623 $ 19,214 Roche Agreement 9,063 4,939 Calico Agreement 1,070 6,943 Total revenue from collaboration agreements $ 20,756 $ 31,096 The $10.3 million decrease in revenue in the year ended December 31, 2023 as compared to the year ended December 31, 2022 is primarily driven by: • a $8.6 million decrease in revenue recognized under the Biogen Agreement primarily as a result of the research term of the Biogen Agreement ending in June 2023, with additional research activities being performed on the nominated targets for a period of time period following the end of the research term, all as contemplated by the Biogen Agreement; and • a $5.9 million decrease in revenue recognized under the Calico Agreement, as a result of the performance obligation and transaction price becoming fully satisfied as of March 31, 2023.
Biggest changeOther income (expense) Other income (expense), net primarily consists of the following: • interest expense and amortization of our long-term debt; • loss on extinguishment of debt; and • interest and other income earned on our cash, cash equivalents, and marketable securities and accretion of discount on marketable securities. 78 Table of Contents Results of operations Comparison of years ended December 31, 2024 and 2023 Revenue Revenue from our collaboration and license agreements consisted of the following (in thousands): Years Ended December 31, 2024 2023 Revenue from collaboration agreements: MKDG Agreement $ 7,304 $ — Merck Agreement 3,979 — Betta Agreement 3,415 — Roche Agreement 3,988 9,063 Biogen Agreement 16,898 10,623 Calico Agreement — 1,070 Total revenue from collaboration agreements $ 35,584 $ 20,756 The $14.8 million increase in revenue in the year ended December 31, 2024 as compared to the year ended December 31, 2023 is primarily driven by: • a $14.7 increase in revenue recognized from the MKDG, Merck and Betta Pharma collaborations that had activities commence in 2024; and • a $6.3 million increase in revenue recognized under the Biogen Agreement primarily as a result of our receipt of two $8.0 milestones earned for the accepted delivery of two separate development candidates in undisclosed indications in 2024, offset by reduced revenue due to the research term being fully satisfied as of June 30, 2024.
We expect that our general and administrative expenses will continue to increase in the future to support increased research and development activities. These increases will likely include higher costs related to the hiring of additional personnel; fees to outside consultants, lawyers, and accountants; and investor and public relations costs.
We expect that our general and administrative expenses will continue to increase in the future to support increased research and development activities. These increases will likely include higher costs related to the hiring of additional personnel; fees to outside consultants, lawyers, and accountants; and investor and public relations.
Because of the numerous risks and uncertainties associated with development and commercialization of our product candidates, we are unable to estimate the amounts of increased capital and operating costs associated with our current and anticipated preclinical and clinical development.
Because of the numerous risks and uncertainties associated with the development and commercialization of our product candidates, we are unable to estimate the amounts of increased capital and operating costs associated with our current and anticipated preclinical and clinical development.
Our future capital requirements will depend on many factors, including: • the progress, costs, and results of ongoing and planned first-in-human Phase 1/2 trials for our lead product candidates and any future clinical development of those lead product candidates; • the scope, progress, costs, and results of preclinical and clinical development for our other product candidates and development programs; • the number and development requirements of other product candidates that we pursue; • the progress and success of our existing and any future collaborations with third party partners, including whether or not we receive additional research support or milestone payments from our collaboration partners upon the achievement of milestones; • the costs, timing, and outcome of regulatory review of our product candidates; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • our willingness and ability to establish additional collaboration arrangements with other biotechnology or pharmaceutical companies on favorable terms, if at all, for the development or commercialization of current or additional future product candidates; • the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval; and 86 Table of Contents • the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval.
Our future capital requirements will depend on many factors, including: • the progress, costs, and results of ongoing and planned first-in-human Phase 1/2 trials for our lead product candidates and any future clinical development of those lead product candidates; 82 Table of Contents • the scope, progress, costs, and results of preclinical and clinical development for our other product candidates and development programs; • the number and development requirements of other product candidates that we pursue; • the progress and success of our existing and any future collaborations with third party partners, including whether or not we receive additional research support or milestone payments from our collaboration partners upon the achievement of milestones; • the costs, timing, and outcome of regulatory review of our product candidates; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • our willingness and ability to establish additional collaboration arrangements with other biotechnology or pharmaceutical companies on favorable terms, if at all, for the development or commercialization of current or additional future product candidates; • the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval; and • the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval.
To date, we have not received any royalties under any of our existing collaboration agreements. For a description of our collaboration agreements with Merck, Betta Pharma, Roche, Biogen, and Calico Life Sciences LLC, or Calico, please see Note 8, Collaboration and license agreements , to the consolidated financial statements in this Annual Report on Form 10-K.
To date, we have not received any royalties under any of our existing collaboration agreements. For a description of our collaboration agreements with MKDG, Merck, Betta Pharma, Roche, Biogen, and Calico Life Sciences LLC, or Calico, please see Note 8, Collaboration and license agreements , to the consolidated financial statements in this Annual Report on Form 10-K.
Our revenues to date have been generated through research collaboration and license agreements. We recognize revenue over the expected performance period under each agreement. We expect that our 81 Table of Contents revenue for the next several years will be derived primarily from our current collaboration agreements and any additional collaborations that we may enter into in the future.
Our revenues to date have been generated through research collaboration and license agreements. We recognize revenue over the expected performance period under each agreement. We expect that our revenue for the next several years will be derived primarily from our current collaboration agreements and any additional 77 Table of Contents collaborations that we may enter into in the future.
To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps at inception of the agreement or upon material modification of the agreement: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the 87 Table of Contents transaction price, including variable consideration, if any; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation.
To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps at inception of the agreement or upon material modification of the agreement: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price, including variable consideration, if any; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation.
Research and development expenses Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts, and the development of our product candidates, and include: • salaries, benefits, and other related costs, including stock-based compensation expense, for personnel engaged in research and development functions; • expenses incurred under agreements with third parties, including contract research organizations and other third parties that conduct research, preclinical, and clinical activities on our behalf as well as third parties that manufacture our product candidates for use in our preclinical and clinical trials; • costs of outside consultants, including their fees, and related travel expenses; • the costs of laboratory supplies and acquiring materials for preclinical studies and clinical trials; • the costs associated with wind down activities for CFT8634; • facility-related expenses, which include direct depreciation costs of equipment and allocated expenses for rent and maintenance of facilities and other operating costs; and • third-party licensing fees.
Research and development expenses Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts, and the development of our product candidates, and include: • salaries, benefits, and other related costs, including stock-based compensation expense, for personnel engaged in research and development functions; • expenses incurred under agreements with third parties, including contract research organizations and other third parties that conduct research, preclinical, and clinical activities on our behalf as well as third parties that manufacture our product candidates for use in our preclinical and clinical trials; • costs of outside consultants, including their fees, and related travel expenses; • the costs of laboratory supplies and acquiring materials for preclinical studies and clinical trials; • facility-related expenses, which include direct depreciation costs of equipment and allocated expenses for rent and maintenance of facilities and other operating costs; and • third-party licensing fees.
Although we may receive potential future milestone and royalty payments under our collaborations with Roche, Biogen, Calico, Betta Pharma, and Merck we do not have any committed external source of funds as of December 31, 2023. Adequate additional funds may not be available to us on acceptable terms, or at all.
Although we may receive potential future milestone and royalty payments under our collaborations with MKDG, Merck, Betta Pharma, Roche, and Biogen, we do not have any committed external source of funds as of December 31, 2024. Adequate additional funds may not be available to us on acceptable terms, or at all.
(see Note 10). 84 Table of Contents In connection with the execution of the Betta Pharma License Agreement, the Company, Betta Pharma, and an affiliate of Betta Pharma, (Betta Investment (Hong Kong) Limited, or Betta Investment), entered into a stock purchase agreement dated May 29, 2023 , or the Betta Stock Purchase Agreement pursuant to which Betta Investment agreed to purchase 5,567,928 shares of the Company's common stock, or the Shares, for an aggregate purchase price of approximately $25.0 million, or $4.49 per share, which represented a 25% premium over the 60-trading-day volume weighted average closing price as of two trading days prior to the effective date of the Betta Stock Purchase Agreement.
In connection with the execution of the Betta Pharma License Agreement, we entered into a stock purchase agreement dated May 29, 2023 , or the Betta Stock Purchase Agreement, with Betta Pharma and an affiliate of Betta Pharma, (Betta Investment (Hong Kong) Limited, or Betta Investment), pursuant to which Betta Investment agreed to purchase 5,567,928 shares of the Company's common stock, or the Shares, for an aggregate purchase price of approximately $25.0 million, or $4.49 per share, which represented a 25% premium over the 60-trading-day volume weighted average closing price as of two trading days prior to the effective date of the Betta Stock Purchase Agreement.
The lease liability is measured by calculating the present value of lease payments under the lease arrangement using the incremental borrowing rate.
The lease liability is measured by calculating the present value of lease payments under the lease arrangement 84 Table of Contents using the incremental borrowing rate.
We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis.
We base our estimates on historical experience, 83 Table of Contents known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.
We simultaneously entered into an equity distribution agreement with Cowen and Company, LLC, as sales agent, to provide for the issuance and sale by us of up to $200.0 million of common stock from time to time in “at-the-market” offerings under the Registration Statement and related prospectus filed with the Registration Statement, or the ATM Program.
We simultaneously entered into a sales agreement with Cowen and Company, LLC (now TD Securities (USA) LLC), as sales agent, to provide for the issuance and sale by us of up to $200.0 million of common stock from time to time in “at-the-market” offerings under the Registration Statement and related prospectus filed with the Registration Statement, or the 2021 ATM Program.
Liquidity and capital resources Sources of liquidity Since inception, we have incurred significant operating losses. We expect to incur significant expenses and operating losses for the foreseeable future as we continue development of our programs. We do not currently have any approved products and have never generated any revenue from product sales.
We expect to incur significant expenses and operating losses for the foreseeable future as we continue the development of our programs. We do not currently have any approved products and have never generated any revenue from product sales.
Income tax expense For the year ended December 31, 2023, income tax expense was $1.3 million, compared to no income tax expense in the year ended December 31, 2022.
Income tax expense For the year ended December 31, 2024, there was $0.1 million income tax expense, compared to $1.3 million income tax expense in the year ended December 31, 2023.
Beyond these initial product candidates, we are further diversifying our pipeline by developing new degraders against both clinically validated and currently undruggable targets for our own proprietary pipeline and for the pipeline we are developing in collaboration with Merck, Biogen and Roche.
Beyond these initial product candidates, we are further diversifying our pipeline by developing new degraders for our own proprietary pipeline and for the pipeline we are developing in collaboration with MKDG, Merck, Biogen and Roche.
In preclinical studies, CFT1946 is more efficacious than the standard of care therapies in CRC and NSCLC BRAF V600X xenograft models and in a melanoma patient-derived xenograft, or PDX, BRAF inhibitor resistance model. Additionally, CFT1946 is active in a preclinical metastatic melanoma central-nervous system, or CNS, model.
Additionally, CFT1946 is more efficacious than the standard of care therapies in CRC BRAF V600X xenograft models and in a melanoma patient-derived xenograft, or PDX, BRAF inhibitor resistance model.
Although we do not expect our estimates of the incremental borrowing rates to generate material differences within a reasonable range of sensitivities, judgement is involved in selecting an appropriate rate, and the rate selected for our leases will have an impact on the value of the lease liability and corresponding right-of-use asset in the consolidated balance sheets. 88 Table of Contents Stock options We account for all stock-based awards granted to employees and non-employees as stock-based compensation expense at fair value.
Although we do not expect our estimates of the incremental borrowing rates to generate material differences within a reasonable range of sensitivities, judgement is involved in selecting an appropriate rate, and the rate selected for our leases will have an impact on the value of the lease liability and corresponding right-of-use asset in the consolidated balance sheets.
In November 2021, we filed an automatically effective registration statement on Form S-3, or the Registration Statement, with the SEC which registers the offering, issuance, and sale of an unspecified amount of common stock, preferred stock, debt securities, warrants, and/or units of any combination thereof.
As of December 31, 2024 , we had cash, cash equivalents and marketable securities of approximately $267.3 million. 80 Table of Contents In November 2021, we filed an automatically effective registration statement on Form S-3, or the Registration Statement, with the SEC which registers the offering, issuance, and sale of an unspecified amount of common stock, preferred stock, debt securities, warrants, and/or units of any combination thereof.
Contractual obligations The following is a summary of our significant contractual obligations as of December 31, 2023 (in thousands): Total Less than 1 Year 1 to 3 Years 4 to 5 Years More than 5 Years Operating lease commitments (see Note 6) $ 89,046 $ 8,828 $ 18,459 $ 21,008 $ 40,751 We enter into contracts in the normal course of business with third-party CROs for clinical trials, preclinical studies, manufacturing and other services, and products for operating purposes.
Contractual obligations The following is a summary of our significant contractual obligations as of December 31, 2024 (in thousands): Total Less than 1 Year 1 to 3 Years 4 to 5 Years More than 5 Years Operating lease commitments (see Note 6) $ 80,217 $ 9,093 $ 19,012 $ 23,775 $ 28,337 We enter into contracts in the normal course of business with third-party CROs for clinical trials, preclinical studies, manufacturing and other services and products for operating purposes.
The $58.4 million of net cash provided by investing activities for the year ended December 31, 2022 was attributable to $63.9 million for the proceeds from marketable securities, net of purchases, and was offset by $5.5 million for the purchases of property and equipment.
The $158.3 million of net cash provided by investing activities for the year ended December 31, 2023 was attributable to $160.1 million for the proceeds from marketable securities, net of purchases, and was offset by $1.7 million for the purchases of property and equipment.
Other Income (Expense) The following table summarizes our other income (expense) (in thousands): Years Ended December 31, 2023 2022 Other income (expense), net Interest and other income, net $ 9,812 $ 3,575 Interest expense and amortization of long-term debt—related party (1,373) (2,216) Loss on extinguishment of long term debt (621) — Total other income (expense), net $ 7,818 $ 1,359 The $6.5 million increase in other income (expense) for the year ended December 31, 2023 as compared to the year ended December 31, 2022 was driven by a $6.2 million increase in interest and other income resulting from higher interest earned on our investments during 2023.
Other Income (Expense) The following table summarizes our other income (expense) (in thousands): Years Ended December 31, 2024 2023 Other income (expense), net Interest and other income, net $ 14,429 $ 9,812 Interest expense and amortization of long-term debt—related party — (1,373) Loss on extinguishment of long-term debt — (621) Total other income (expense), net $ 14,429 $ 7,818 The $6.6 million increase in other income (expense) for the year ended December 31, 2024 as compared to the year ended December 31, 2023 was driven by a $4.6 million increase in interest and other income resulting from higher interest earned on our investments during 2024 and a $1.4 million decrease in interest expense as a result of the extinguishment of our Term Loan with Perceptive Credit Holdings III, LP, an affiliate of Perceptive Advisors LLC, or Term Loan, in 2023.
Financing activities The $45.5 million of net cash provided by financing activities for the year ended December 31, 2023 is primarily driven by proceeds from our at-the-market offering of $57.7 million, offset by the prepayment of the remaining principal balance on the Term Loan with Perceptive Credit Holdings III, LP, an affiliate of Perceptive Advisors LLC, of $12.5 million.
The $45.5 million of net cash provided by financing activities for the year ended December 31, 2023 is primarily driven by $57.7 million of net proceeds from our 2021 ATM Program, offset by the prepayment of the remaining principal balance on the Term Loan of $12.5 million.
Cash flows The following table summarizes our sources and uses of cash for the period presented (in thousands): Years Ended December 31, 2023 2022 Net change in cash, cash equivalents and restricted cash: Net used in operating activities $ (106,838) $ (105,939) Net cash provided by (used in) investing activities 158,349 58,422 Net cash provided by financing activities 45,489 1,147 Net change in cash, cash equivalents and restricted cash $ 97,000 $ (46,370) Operating activities Net cash used in operating activities for the year ended December 31, 2023 was driven primarily by: • our net loss of $132.5 million; • a $10.3 million increase in accounts receivable; and • a $4.7 million decrease in the operating lease liability.
Cash flows The following table summarizes our sources and uses of cash for the period presented (in thousands): Years Ended December 31, 2024 2023 Net change in cash, cash equivalents and restricted cash: Net cash used in operating activities $ (65,157) $ (106,838) Net cash (used in) provided by investing activities (51,270) 158,349 Net cash provided by financing activities 45,336 45,489 Net change in cash, cash equivalents and restricted cash $ (71,091) $ 97,000 Operating activities Net cash used in operating activities was $65.2 million for the year ended December 31, 2024 and was driven primarily by: • our net loss of $105.3 million; • a $5.2 million decrease in the operating lease liability; • a $4.3 million increase in prepaid expenses and current and long-term assets; and • a $1.3 million decrease in accrued expenses and other current liabilities.
Our actual results may differ from these estimates under different assumptions or conditions.
We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.
To date, we have financed our operations primarily through the sale of preferred stock, public offerings of our common stock, and payments from collaboration partners. As of December 31, 2023 , we had cash, cash equivalents and marketable securities of approximately $281.7 million.
To date, we have financed our operations primarily through the sale of preferred stock, public offerings of our common stock, and payments from collaboration partners.
These amounts were partially offset by: • $35.3 million of non-cash expense related to stock compensation expense, depreciation and amortization, and reduction in carrying amount of our right-of-use asset; • a $2.7 million decrease in prepaid expenses and current and long term assets; • a $3.8 million increase in deferred revenue due to our new collaboration agreements; and • a $1.3 million increase in accrued expenses and other current liabilities.
These amounts were partially offset by: • $37.9 million of non-cash expense related to stock compensation expense, depreciation and amortization, and reduction in carrying amount of our right-of-use asset; • a $9.9 million increase in deferred revenue due to our new collaboration agreements; and • an $8.7 million decrease in accounts receivable. 81 Table of Contents Net cash used in operating activities for the year ended December 31, 2023 was driven primarily by: • our net loss of $132.5 million; • a $10.3 million increase in accounts receivable; and • a $4.7 million decrease in the operating lease liability; These amounts were partially offset by: • a $35.3 million of non-cash expense related to stock compensation expense, depreciation, and reduction in carrying amount of our right-of-use asset; • a $3.8 million increase in deferred revenue due to the recognition of revenue under our collaboration agreements; • a $2.7 million decrease in prepaid expenses and current and long-term assets; and • a $1.3 million increase in accrued expenses and other liabilities.
The Betta Stock Purchase Agreement has certain restrictions customary to agreements of this nature. Closing under the Betta Stock Purchase Agreement occurred in January 2024 (see Note 8) .
Closing under the Betta Stock Purchase Agreement occurred in January 2024 (see Note 8) .
These were partially offset by a $4.1 million increase in revenue recognized under the Roche Agreement, resulting from our 2023 completion of research activities for a nominated target.
These were partially offset by: • a $5.1 million decrease in revenue recognized under the Roche Agreement, resulting from our 2023 completion of research activities for a nominated target; and • a $1.1 million decrease in revenue recognized under the Calico Agreement, as a result of the performance obligation and transaction price becoming fully satisfied as of March 31, 2023.
Our next most advanced product candidate, CFT1946, is an orally bioavailable BiDAC degrader designed to be potent and selective against BRAF V600X mutant proteins to treat melanoma, non-small cell lung cancer, or NSCLC, colorectal cancer, or CRC, and other malignancies that harbor this mutation.
We continue to progress the ongoing Phase 1/2 clinical trial in MM and NHL. Our next most advanced product candidate, CFT1946, is an orally bioavailable BiDAC degrader designed to be potent and selective against BRAF V600 mutant proteins to treat melanoma, colorectal cancer, or CRC, and other malignancies that harbor V600 mutations.
Our stock-based payments include stock options, restricted stock units, and grants of common stock, including common stock subject to vesting. The measurement date for awards is the date of grant, and stock-based compensation costs are recognized as expense over the requisite service period, which is generally the vesting period, on a straight-line basis.
The measurement date for awards is the date of grant, and stock-based compensation costs are recognized as expense over the requisite service period, which is generally the vesting period, on a straight-line basis. Stock-based compensation expense is classified in the consolidated statements of operations and comprehensive loss based on the function to which the related services are provided.
Additionally, we are developing CFT8919, an orally bioavailable, allosteric, mutant-selective BiDAC degrader of epidermal growth factor receptor, or EGFR, with an L858R mutation in NSCLC. In preclinical studies, CFT8919 demonstrated equipotent anti-proliferation activity against EGFR mutations resistant to EGFR inhibition, including L858R-C797S, L858R-T790M, and L858R-T790M-C797S compared to L858R single mutation in Ba/F3 cell models in vitro.
In preclinical studies, CFT8919 demonstrated equipotent anti-proliferation activity against EGFR mutations resistant to EGFR inhibition, including L858R-C797S, L858R-T790M, and L858R-T790M-C797S compared to L858R single mutation in Ba/F3 cell models in vitro.
Research and Development Expenses The following table summarizes our research and development expenses (in thousands): Years Ended December 31, 2023 2022 Research and development expenses: Personnel expenses $ 42,706 $ 41,068 Preclinical and development expenses 28,496 42,033 Clinical expenses 19,238 10,643 Facilities and supplies 13,594 13,978 Professional fees 8,605 7,047 Intellectual property and other expenses 5,067 3,072 Total research and development expenses $ 117,706 $ 117,841 The $0.1 million decrease in research and development expense in the year ended December 31, 2023 from the year ended December 31, 2022 is primarily driven by a $13.5 million decrease in preclinical and development costs related to additional programs progressing to clinical stages.
Research and Development Expenses The following table summarizes our research and development expenses (in thousands): Years Ended December 31, 2024 2023 Research and development expenses: Personnel expenses $ 36,752 $ 42,706 Preclinical and development expenses 29,364 28,496 Clinical expenses 20,808 19,238 Facilities and supplies 12,349 13,594 Professional fees 6,731 8,605 Intellectual property and other expenses 4,633 5,067 Total research and development expenses $ 110,637 $ 117,706 79 Table of Contents The $7.1 million decrease in research and development expense in the year ended December 31, 2024 from the year ended December 31, 2023 is primarily driven by: • a $6.0 million decrease in personnel expenses as a result of our restructuring activities; • a $1.9 million decrease in professional fees; and • a $1.2 million decrease in facilities and supply expenses.
On November 1, 2023, we announced a portfolio prioritization decision not to advance CFT8634 beyond the Phase 1 dose escalation portion of the clinical trial. Components of Operating Results Revenues To date, we have not generated any revenue from product sales and do not expect to generate any revenue from the sale of products for the foreseeable future.
On November 6, 2024, we announced that our partner, Betta Pharma, had dosed the first patient in its Phase 1 clinical trial of CFT8919 in Greater China. Components of Operating Results Revenues To date, we have not generated any revenue from product sales and do not expect to generate any revenue from the sale of products for the foreseeable future.
These were partially offset by: • a $8.6 million increase in clinical expenses as a result of the ongoing Phase 1/2 clinical trials of CFT7455 and CFT1946, as well as the Phase 1 clinical trial of CFT8634; • a $2.0 million increase in intellectual property and other corporate expenses; • a $1.7 million increase in personnel expenses representing salary and benefit costs, resulting from an increase in headcount to support our clinical programs; and • a $1.6 million increase in professional fees. 83 Table of Contents General and Administrative Expenses The following table summarizes our general and administrative expenses (in thousands): Years Ended December 31, 2023 2022 General and administrative expenses: Personnel expenses $ 30,244 $ 30,546 Professional fees 7,365 8,576 Facilities and supplies 2,076 2,371 Other expenses 2,396 1,296 Total general and administrative expenses $ 42,081 $ 42,789 The $0.7 million decrease in general and administrative expense in the year ended December 31, 2023 as compared to the year ended December 31, 2022 is primarily driven by a $1.2 million decrease in professional fees and a $0.6 million decrease in personnel and facilities costs, partially offset by a $1.1 million increase in other expenses.
General and Administrative Expenses The following table summarizes our general and administrative expenses (in thousands): Years Ended December 31, 2024 2023 General and administrative expenses: Personnel expenses $ 31,278 $ 30,244 Professional fees 6,659 7,365 Facilities and supplies 2,751 2,076 Other expenses 1,436 2,396 Total general and administrative expenses $ 42,124 $ 42,081 General and administrative expense in the year ended December 31, 2024, as compared to the year ended December 31, 2023 was flat as a result of a $1.0 million increase in personnel expenses, partially offset by a $1.0 million decrease in other expenses.
Our wholly owned pipeline is focused on oncology and our partnership strategy allows us to explore other indications. Our most advanced product candidate, CFT7455, is an orally bioavailable MonoDAC degrader of protein targets called IKZF1 and IKZF3, currently in clinical development for multiple myeloma, or MM, and non-Hodgkin lymphoma, or NHL.
Our most advanced product candidate, cemsidomide, is an orally bioavailable MonoDAC degrader of protein targets called IKZF1 and IKZF3. Cemsidomide is currently in clinical development for multiple myeloma, or MM, and non-Hodgkin lymphoma, or NHL. With a strong mechanistic rationale and well-defined biology of targeting IKZF1 and IKZF3 cemsidomide has the opportunity to address a significant unmet need.
The $1.1 million of net cash provided by financing activities for the year ended December 31, 2022 is primarily driven by $0.8 million of proceeds from exercises of stock options.
Financing activities The $45.3 million of net cash provided by financing activities for the year ended December 31, 2024 is primarily driven by: • $24.4 million of net proceeds from our at-the-market offering; and • $20.0 million in proceeds for the closing of the Betta Stock Purchase Agreement.
The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model.
We recognize stock-based compensation expense for the portion of awards that have vested. Forfeitures are recorded as they occur. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model.
The Company has sold a total of 13,686,743 shares of its common stock at an average price of $5.42 per share for proceeds, net of commissions and fees, of $71.8 million. For the year ended December 31, 2023, 11,186,142 shares of common stock, for net proceeds of $57.7 million, settled under the ATM Program.
Under this Registration Statement, the Company sold a total of 15,318,264 shares of its common stock at an average price of $5.54 per share for proceeds, net of commissions and fees, of $82.3 million.
We also believe there are many therapeutic areas and indications where leveraging our TORPEDO platform to develop novel degraders may be advantageous. Recent Developments On January 9, 2024, we announced 2024 business priorities to execute against our strategic plan. As a result of these revised priorities, we restructured our operations and reduced our workforce by approximately 30%.
We also believe there are many therapeutic areas and indications where leveraging our TORPEDO platform to develop novel degraders may be advantageous.
This was primarily the result of the $1.0 million withholding tax paid to the Chinese tax authority related to the upfront payment received under the Betta License Agreement and the $0.2 million tax withholding accrued related to the Betta milestone payment received in January (see Note 8 and Note 12).
This was primarily the result of the $1.2 million withholding tax paid to the Chinese tax authority related to the Betta Pharma collaboration in 2023 (see Note 8 and Note 11). Liquidity and capital resources Sources of liquidity Since inception, we have incurred significant operating losses.
We initiated a first-in-human Phase 1/2 clinical trial for this product candidate in June 2021. In August 2021, the United States Food and Drug Administration, or FDA, granted orphan drug designation to CFT7455 for the treatment of MM.
In August 2021, the United States Food and Drug Administration, or FDA, granted orphan drug designation to cemsidomide for the treatment of MM. In December 2024, we shared data evaluating cemsidomide in combination with dexamethasone in MM that demonstrated a well-tolerated profile with compelling anti-myeloma activity.
As a result, if a different volatility had been used, stock-based compensation cost could have been materially impacted. New accounting pronouncements For information on new accounting standards, see Note 2, Summary of significant accounting policies , to our consolidated financial statements in this Annual Report on Form 10-K.
As a result, if a different volatility had been used, stock-based compensation cost could have been materially impacted.
We believe our novel oral product candidates have the potential to overcome drug resistance often seen with inhibitors, target currently “undruggable” targets and improve patient outcomes. Our preclinical and clinical pipeline includes MonoDAC and BiDAC degraders that have the potential to target disease causing proteins for various cancers and other indications in areas of unmet patient need.
To date, our platform has produced several novel, oral, highly catalytic degraders that have demonstrated robust target degradation, some of which are brain penetrant and all of which have the potential to overcome drug resistance often seen with inhibitors and improve patient outcomes. 76 Table of Contents Currently, our solely-owned pipeline is focused on oncology and our partnership strategy allows us to explore other disease areas with unmet needs.
In January 2024, we shared PK and PD data from the first two dose escalation cohorts of the ongoing Phase 1/2 trial demonstrating dose proportional exposure and oral bioavailability, which are associated with deep BRAF degradation. We continue to progress the ongoing Phase 1/2 clinical trial in BRAF V600X cancers, including melanoma, NSCLC, and CRC.
In September 2024, at the European Society of Medical Oncology Congress, we presented monotherapy data from the ongoing Phase 1/2 trial, which demonstrated that CFT1946 was well tolerated with initial signs of anti-tumor activity across all dose levels. We continue to progress the ongoing Phase 1/2 clinical trial in BRAF V600 mutant protein cancers, including melanoma and CRC.
Removed
There is a strong mechanistic rationale and well-defined biology to target IKZF1 and IKZF3 and targeting them with a novel degrader has the potential to address a significant unmet need. In our preclinical studies, this product candidate has demonstrated potent and selective protein degradation with favorable pharmacological properties.
Added
We have also shared cemsidomide monotherapy data in MM where cemsidomide activates immune cells at clinically relevant doses. Additionally, in December 2024, we shared data evaluating cemsidomide as a monotherapy in NHL that demonstrated a well-tolerated profile and compelling anti-lymphoma activity in NHL and, in particular, in PTCL.
Removed
In December 2023, we 80 Table of Contents presented positive clinical data from the dose escalation portion of the CFT7455 Phase 1/2 trial as a monotherapy and in combination with dexamethasone in MM. We continue to progress the ongoing Phase 1/2 clinical trial in MM and NHL.
Added
In preclinical studies, CFT1946 has demonstrated the ability to cross the blood-brain barrier with Kp uu values ranging from 0.34 to 0.88, an important feature as a portion of patients with BRAF V600 mutant solid tumors develop brain metastases.
Removed
In January 2023, we initiated a first-in-human Phase 1/2 clinical trial of CFT1946 for the treatment of BRAF V600X mutant solid tumors including NSCLC, CRC and melanoma.
Added
Additionally, we are developing CFT8919, an orally bioavailable, allosteric, mutant-selective BiDAC degrader of epidermal growth factor receptor, or EGFR, with an L858R mutation in non-small cell lung cancer, or NSCLC.
Removed
Additionally in June 2023, the FDA cleared the investigational new drug, or IND, application for CFT8919 and in December 2023, Betta Pharma received clinical trial application, or CTA, clearance for CFT8919 from China's National Medical Product Administration.
Added
In November 2024, Betta Pharma initiated a Phase 1 clinical trial of CFT8919 in EGFR L858R NSCLC in Greater China and is continuing to progress the trial. Data generated from this trial will inform our ex-China clinical development strategy.
Removed
Additionally, we announced the sale of 13,686,743 shares of our common stock at an average purchase price of $5.42 through the company's at-the-market (or ATM) facility, resulting in net proceeds of $71.8 million. On January 4, 2024, we announced the closing of the transaction contemplated under the previously announced stock purchase agreement with a wholly-owned subsidiary of Betta Pharma.
Added
Recent Developments On December 8, 2024, we presented data from our ongoing first-in-human clinical trial for cemsidomide in combination with at the Annual Society of Hematology meeting that demonstrated compelling safety and anti-tumor activity across the MM and NHL arms. On November 20, 2024, we announced the appointment of Steve Hoerter to our board of directors.
Removed
At the closing, we sold an affiliate of Betta Pharma 5,567,928 shares of our common stock at a purchase price of $4.49 per share, for an aggregate investment of $25 million.
Added
Restructuring Restructuring expenses consists of one-time costs incurred under a reduction plan to align with the needs of the business. These costs include employee severance, benefits and related termination costs.
Removed
The purchase price represented a 25% premium over the 60-trading-day volume weighted average through the date that was two business days prior to the entry into the stock purchase agreement on May 29, 2023.
Added
These were partially offset by a $1.6 million increase in clinical expenses due to continued progress on our cemsidomide and CFT1946 programs.
Removed
On December 12, 2023, we presented positive clinical data from the dose escalation portion of our Phase 1/2 trial of CFT7455 as a monotherapy and in combination with dexamethasone in MM. We continue to progress the ongoing Phase 1/2 clinical trial in MM and NHL.
Added
For the year ended December 31, 2024, 4,132,122 shares of common stock, for net proceeds of $24.4 million, settled under the 2021 ATM Program (see Note 9).
Removed
On December 12, 2023, we announced that we entered into an exclusive license and collaboration agreement with Merck to develop degrader-antibody conjugates, or DACs, an emerging modality designed to selectively target and neutralize disease-causing proteins in cancer cells. On November 20, 2023, we announced the appointment of Owen Hughes to our board of directors.
Added
In October 2024, the Company filed a registration statement on Form S-3, or the Registration Statement, with the SEC that became effective on November 13, 2024 and registered the offering, issuance and sale of an unspecified amount of common stock, preferred stock, debt securities, warrants and/or units of any combination thereof.
Removed
Other income (expense) Other income (expense), net primarily consists of the following: • interest expense and amortization of our long-term debt; • loss on extinguishment of debt; and • interest and other income earned on our cash, cash equivalents, and marketable securities and accretion of discount on marketable securities.
Added
Simultaneously, the Company entered into a sales agreement with TD Securities (USA) LLC, as sales agent, to provide for the issuance and sale by the Company of up to $200.0 million of common stock from time to time in “at-the-market” offerings under the Registration Statement and related prospectus filed with the Registration Statement, or the 2024 ATM Program.
Removed
In January 2024, 2,500,601 shares were settled for net proceeds of $14.1 million.
Added
For the year ended December 31, 2024, no sales were made under the 2024 ATM Program.
Removed
Net cash used in operating activities for the year ended December 31, 2022 was driven primarily by: • our net loss of $128.2 million; • a $22.7 million decrease in deferred revenue due to the recognition of revenue under our collaboration agreements; and • a $3.3 million decrease in accounts payable.
Added
The $25.0 million of proceeds that we received were recorded as $20.0 million for the issuance of shares, with the remaining $5.0 million of premium paid on the share price recorded as consideration for revenue under the Betta Pharma License and Collaboration Agreement. The Betta Stock Purchase Agreement has certain restrictions customary to agreements of this nature.
Removed
These amounts were partially offset by: • a $37.6 million of non-cash expense related to stock compensation expense, depreciation, and reduction in carrying amount of our right-of-use asset; • a $5.1 million increase in accrued expenses and other liabilities; and • a $4.2 million decrease in accounts receivable. 85 Table of Contents Investing activities The $158.3 million of net cash provided by investing activities for the year ended December 31, 2023 was attributable to $160.1 million for the proceeds from maturities of marketable securities, net of purchases, and was offset by $1.7 million for the purchases of property and equipment.
Added
Investing activities The $51.3 million of net cash used in investing activities for the year ended December 31, 2024 was attributable to $51.1 million for the purchases of marketable securities, net of sales and proceeds from maturities.
Removed
Stock-based compensation expense is classified in the consolidated statements of operations and comprehensive loss based on the function to which the related services are provided. We recognize stock-based compensation expense for the portion of awards that have vested. Forfeitures are recorded as they occur.
Added
Stock options We account for all stock-based awards granted to employees and non-employees as stock-based compensation expense at fair value. Our stock-based payments include stock options, restricted stock units, and grants of common stock, including common stock subject to vesting.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed1 unchanged
Biggest changeAs of December 31, 2023, we had marketable securities of $155.1 million. Our marketable securities are short-term in nature with a weighted-average maturity date of 0.6 years. As such, while these interest-earning instruments carry a degree of interest rate risk, historical fluctuations in interest income have not been significant for us.
Biggest changeAs of December 31, 2024, we had marketable securities of $211.8 million. Our marketable securities are short-term in nature with a weighted-average maturity date of 0.5 years. As such, while these interest-earning instruments carry a degree of interest rate risk, historical fluctuations in interest income have not been significant for us.

Other CCCC 10-K year-over-year comparisons