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What changed in ROCKET PHARMACEUTICALS, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of ROCKET PHARMACEUTICALS, 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.

+423 added−428 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-27)

Top changes in ROCKET PHARMACEUTICALS, INC.'s 2024 10-K

423 paragraphs added · 428 removed · 338 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

176 edited+59 added−55 removed273 unchanged
Biggest change(“RGNX”), pursuant to which we obtained an exclusive license for all U.S. patents and patent applications related to RGNX’s NAV AAV-9 vector for the treatment of DD in humans by in vivo gene therapy using AAV-9 to deliver any known LAMP2 transgene isoforms and all possible combinations of LAMP2 transgene isoforms (the “Field”), as well as an exclusive option to license (the “Option Right”) all U.S. patents and patent applications for two additional NAV AAV vectors in the Field (each, a “Licensed Patent” and collectively, the “Licensed Patents”). 19 In consideration for the rights granted to us under the license agreement, we made an upfront payment to RGNX of $7.0 million which was expensed to R&D costs in the 2018 consolidated statement of operations.
Biggest changeLicense Agreement for DD with RGNX On November 19, 2018, we entered into a license agreement with RGNX, pursuant to which we obtained an exclusive license for all U.S. patents and patent applications related to RGNX’s NAV AAV-9 vector for the treatment of DD in humans by in vivo gene therapy using AAV-9 to deliver any known LAMP2 transgene isoforms and all possible combinations of LAMP2 transgene isoforms, as well as an exclusive option to license all U.S. patents and patent applications for two additional NAV AAV vectors.
Under the terms of the agreement, we are obligated to use commercially reasonable efforts to (a) develop and obtain regulatory approval for one or more products or processes covered by the licensed intellectual property, introduce such products or processes into the commercial market and then make them reasonably available to the public (b) develop or commercialize at least one product or process covered by the licensed intellectual property in at least one country for at least two uninterrupted years following regulatory approval, and (c) use the licensed intellectual property in an adequate, ethical and legitimate manner.
Under the terms of the agreement, we are obligated to use commercially reasonable efforts to (a) develop and obtain regulatory approval for one or more products or processes covered by the licensed intellectual property, introduce such products or processes into the commercial market and then make them reasonably available to the public (b) develop or commercialize at least one product or process covered by the licensed intellectual property in at least one country for at least two uninterrupted years following regulatory approval, and (c) use the licensed intellectual property in an adequate, ethical and legitimate manner.
Under the terms of the agreement, we are obligated to use commercially reasonable efforts to (a) develop and obtain regulatory approval for one or more products or processes covered by the licensed intellectual property, introduce such products or processes into the commercial market and then make them reasonably available to the public, (b) develop or commercialize at least one product or process covered by the licensed intellectual property in at least one country for at least two uninterrupted years following regulatory approval, and (c) use the licensed intellectual property in an adequate, ethical and legitimate manner.
Under the terms of the agreement, we are obligated to use commercially reasonable efforts to (a) develop and obtain regulatory approval for one or more products or processes covered by the licensed intellectual property, introduce such products or processes into the commercial market and then make them reasonably available to the public, (b) develop or commercialize at least one product or process covered by the licensed intellectual property in at least one country for at least two uninterrupted years following regulatory approval, and (c) use the licensed intellectual property in an adequate, ethical and legitimate manner.
The license is in effect for a duration for each of the countries defined in this agreement for as long as a license right exists that covers the licensed product or process in such country, or until the end of any additional legal protection that should be obtained for the license rights in each country.
The license is in effect for a duration for each of the countries defined in this agreement for as long as a license right exists that covers the licensed product or process in such country, or until the end of any additional legal protection that should be obtained for the license rights in each country.
Most recently, on August 16, 2022, President Biden signed the Inflation Reduction Act (“IRA”) which provides for (i) the government to set or negotiate prices for select high-cost Medicare Part D (beginning in 2026) and Medicare Part B drugs (beginning in 2028) that are more than nine years (for small-molecule drugs) or 13 years (for biological products) from their FDA approval, (ii) manufacturers to pay a rebate for Medicare Part B and Part D drugs when prices increase faster than inflation beginning in 2022 for Medicare Part D and 2023 for Medicare Part B drugs, and (iii) Medicare Part D redesign which replaces the current coverage gap provisions and establishes a $2,000 cap for out-of-pocket limits costs for Medicare beneficiaries beginning in 2025, with manufacturers being responsible for 10% of costs up to the $2,000 cap and 20% after that cap is reached.
Most recently, on August 16, 2022, President Biden signed the Inflation Reduction Act which provides for (i) the government to set or negotiate prices for select high-cost Medicare Part D (beginning in 2026) and Medicare Part B drugs (beginning in 2028) that are more than nine years (for small-molecule drugs) or 13 years (for biological products) from their FDA approval, (ii) manufacturers to pay a rebate for Medicare Part B and Part D drugs when prices increase faster than inflation beginning in 2022 for Medicare Part D and 2023 for Medicare Part B drugs, and (iii) Medicare Part D redesign which replaces the current coverage gap provisions and establishes a $2,000 cap for out-of-pocket limits costs for Medicare beneficiaries beginning in 2025, with manufacturers being responsible for 10% of costs up to the $2,000 cap and 20% after that cap is reached.
These reductions went into effect in April 2013 and, due to subsequent legislative amendments to the statute, will remain in effect through 2030 unless additional action is taken by Congress. • On April 13, 2017, CMS published a final rule that gives states greater flexibility in setting benchmarks for insurers in the individual and small group marketplaces, which may have the effect of relaxing the essential health benefits required under the ACA for plans sold through such marketplaces. • On May 30, 2018, the Right to Try Act, was signed into law.
These reductions went into effect in April 2013 and, due to subsequent legislative amendments to the statute, will remain in effect through 2030 unless additional action is taken by Congress. • On April 13, 2017, CMS published a final rule that gives states greater flexibility in setting benchmarks for insurers in the individual and small group marketplaces, which may have the effect of relaxing the essential health benefits required under the ACA for plans sold through such marketplaces. 34 • On May 30, 2018, the Right to Try Act, was signed into law.
Our current and future business activities, including for example, sales, marketing, and scientific/educational grant programs must comply with healthcare regulatory laws, as applicable, which may include the Federal Anti-Kickback Statute, the Federal False Claims Act, as amended, the privacy and security regulations promulgated under the Health Insurance Portability and Accountability Act (“HIPAA”), as amended, physician payment transparency laws, and similar state laws.
Our current and future business activities, including for example, sales, marketing, and scientific/educational grant programs must comply with healthcare regulatory laws, as applicable, which may include the Federal Anti-Kickback Statute, the Federal False Claims Act, as amended, the privacy and security regulations promulgated under the Health Insurance Portability and Accountability Act, as amended, physician payment transparency laws, and similar state laws.
There is no 30 obligation for a pharmaceutical manufacturer to make its drug products available to eligible patients as a result of the Right to Try Act. • On May 23, 2019, CMS published a final rule to allow Medicare Advantage Plans the option of using step therapy for Part B drugs beginning January 1, 2020.
There is no obligation for a pharmaceutical manufacturer to make its drug products available to eligible patients as a result of the Right to Try Act. • On May 23, 2019, CMS published a final rule to allow Medicare Advantage Plans the option of using step therapy for Part B drugs beginning January 1, 2020.
These endpoints could support full approval with longer-term follow-up. • A global natural history study will serve as an external comparator and run concurrently to the Phase 2 pivotal trial. • In-house manufacturing has been completed with sufficient high-quality drug product produced to fully supply the Phase 2 pivotal study.
These endpoints could support full approval with longer-term follow-up. 14 • A global natural history study will serve as an external comparator and run concurrently to the Phase 2 pivotal trial. • In-house manufacturing has been completed with sufficient high-quality drug product produced to fully supply the Phase 2 pivotal study.
In exchange for the license, we are obligated to pay CIEMAT an up-front payment, royalty payments based on net sales of products or processes involving any of the licensed intellectual property, developmental and regulatory milestone payments, and sublicense revenue payments. We are responsible for prosecuting and maintaining the licensed patents at our expense, in cooperation with CIEMAT.
In exchange for the license, we are obligated to pay CIEMAT Group an up-front payment, royalty payments based on net sales of products or processes involving any of the licensed intellectual property, developmental and regulatory milestone payments, and sublicense revenue payments. We are responsible for prosecuting and maintaining the licensed patents at our expense, in cooperation with CIEMAT Group.
Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private third-party payors. There have been, and likely will continue to be, legislative and regulatory proposals at the foreign, federal, and state levels directed at broadening the availability of healthcare and containing or lowering the cost of healthcare.
Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private third-party payors. 35 There have been, and likely will continue to be, legislative and regulatory proposals at the foreign, federal, and state levels directed at broadening the availability of healthcare and containing or lowering the cost of healthcare.
Gene Therapy Overview Genes are composed of sequences of deoxyribonucleic acid (“DNA”), which provide the code for proteins that perform a broad range of physiologic functions in all living organisms. Although genes are passed on from generation to generation, genetic changes, also known as mutations, can occur in this process.
Gene Therapy Overview Genes are composed of sequences of deoxyribonucleic acid, which provide the code for proteins that perform a broad range of physiologic functions in all living organisms. Although genes are passed on from generation to generation, genetic changes, also known as mutations, can occur in this process.
Gene therapy aims to address the disease-causing effects of absent or dysfunctional genes by delivering functional copies of the gene sequence directly into the patient’s cells, offering the potential for curing the genetic disease, rather than simply addressing symptoms. We are using modified non-pathogenic viruses for the development of our gene therapy treatments.
Gene therapy aims to address the disease-causing effects of absent or dysfunctional genes by delivering functional copies of the gene sequence directly into the patient’s cells, offering the potential for curing the genetic disease, rather than simply addressing symptoms. 9 We are using modified non-pathogenic viruses for the development of our gene therapy treatments.
The distribution of pharmaceutical products is subject to additional requirements and regulations, including extensive record-keeping, licensing, storage, and security requirements intended to prevent the unauthorized sale of pharmaceutical products. 28 The Federal Anti-Kickback Statute makes it illegal for any person or entity, including a prescription drug manufacturer (or a party acting on its behalf) to knowingly and willfully, directly or indirectly, in cash or in kind, solicit, receive, offer, or pay any remuneration that is intended to induce the referral of business, including the purchasing, leasing, ordering or arranging for or recommending the purchase, lease or order of, any good, facility, item or service for which payment may be made, in whole or in part, under a federal healthcare program, such as Medicare or Medicaid.
The distribution of pharmaceutical products is subject to additional requirements and regulations, including extensive record-keeping, licensing, storage, and security requirements intended to prevent the unauthorized sale of pharmaceutical products. 32 The Federal Anti-Kickback Statute makes it illegal for any person or entity, including a prescription drug manufacturer (or a party acting on its behalf) to knowingly and willfully, directly or indirectly, in cash or in kind, solicit, receive, offer, or pay any remuneration that is intended to induce the referral of business, including the purchasing, leasing, ordering or arranging for or recommending the purchase, lease or order of, any good, facility, item or service for which payment may be made, in whole or in part, under a federal healthcare program, such as Medicare or Medicaid.
We also have the first responsibility to enforce and defend the licensed patents against infringement and/or challenge, in cooperation with CIEMAT. For five years following the effective date of the license agreement, we had a right of first refusal to license any improvements to the licensed intellectual property obtained by CIEMAT at market value.
We also have the first responsibility to enforce and defend the licensed patents against infringement and/or challenge, in cooperation with CIEMAT. For five years following the effective date of the license agreement, we had a right of first refusal to license any improvements to the licensed intellectual property obtained by CIEMAT Group at market value.
License Agreement for DD with UCSD In February 2017, we entered into a license agreement with The Regents of the University of California, represented by its San Diego campus (“UCSD”), under which UCSD granted us an exclusive, sublicensable, worldwide license to certain intellectual property rights for the treatment of lysosomal storage diseases, including DD.
License Agreement for DD with UCSD In February 2017, we entered into a license agreement with The Regents of the University of California, represented by its San Diego campus, under which UCSD granted us an exclusive, sublicensable, worldwide license to certain intellectual property rights for the treatment of lysosomal storage diseases, including DD.
Our potential competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for our products. 20 Manufacturing Our gene therapy platform has two main components: the production of LV and AAV vectors and the target cell transduction process, which results in drug product.
Our potential competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for our products. Manufacturing Our gene therapy platform has two main components: the production of LV and AAV vectors and the target cell transduction process, which results in drug product.
The results of preclinical and human clinical testing are submitted to the FDA in the form of a BLA for approval to commence commercial sales. All clinical trials must be conducted in accordance with FDA regulations, GCP requirements and their protocols in order for the data to be considered reliable for regulatory purposes.
The results of preclinical and human clinical testing are submitted to the FDA in the form of a BLA for approval to commence commercial sales. 26 All clinical trials must be conducted in accordance with FDA regulations, GCP requirements and their protocols in order for the data to be considered reliable for regulatory purposes.
Any product submitted to FDA for marketing, including under a Fast Track program, may be eligible for other types of FDA programs intended to expedite development and review, such as regenerative medicine advanced therapy (“RMAT”) designation, priority review and accelerated approval.
Any product submitted to FDA for marketing, including under a Fast Track program, may be eligible for other types of FDA programs intended to expedite development and review, such as regenerative medicine advanced therapy designation, priority review and accelerated approval.
Based on statutory standards, elements of a REMS may include “Dear Doctor letters,” a medication guide, more elaborate targeted educational programs, and in some cases distribution and use restrictions, referred to as elements to assure safe use (“ETASU”).
Based on statutory standards, elements of a REMS may include “Dear Doctor letters,” a medication guide, more elaborate targeted educational programs, and in some cases distribution and use restrictions, referred to as elements to assure safe use.
Furthermore, such an approach could spare patients the need for lifelong adherence to multiple arrhythmia and heart failure drugs that are nonspecific for PKP2-ACM and are associated with their own side effects, enabling patients an opportunity to live without exercise restrictions and with diminished concern for arrhythmias, palpitations, ICD shocks and progression to end-stage heart failure. 11 In May 2023, we presented preclinical efficacy data for RP-A601 at the American Society of Gene and Cell Therapy 26th Annual meeting.
Furthermore, such an approach could spare patients the need for lifelong adherence to multiple arrhythmia and heart failure drugs that are nonspecific for PKP2-ACM and are associated with their own side effects, enabling patients an opportunity to live without exercise restrictions and with diminished concern for arrhythmias, palpitations, ICD shocks and progression to end-stage heart failure. 15 In May 2023, we presented preclinical efficacy data for RP-A601 at the American Society of Gene and Cell Therapy 26th Annual meeting.
The sponsor of a product candidate for a rare pediatric disease may be eligible for a voucher that can be used to obtain a priority review for a subsequent human drug or biological product application after the date of approval of the rare pediatric disease drug or biological product, referred to as a priority review voucher (“PRV”).
The sponsor of a product candidate for a rare pediatric disease may be eligible for a voucher that can be used to obtain a priority review for a subsequent human drug or biological product application after the date of approval of the rare pediatric disease drug or biological product, referred to as a priority review voucher.
The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. Before approving a BLA, the FDA typically will inspect the facilities at which the product is manufactured.
The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions. 27 Before approving a BLA, the FDA typically will inspect the facilities at which the product is manufactured.
Government Regulation FDA Regulation and Marketing Approval In the U.S., the FDA regulates drugs under the Federal Food, Drug and Cosmetic Act (“FDCA”), and biologics under the Public Health Service Act, the regulations promulgated under both laws and other federal, state, and local statutes and regulations.
Government Regulation FDA Regulation and Marketing Approval In the U.S., the FDA regulates drugs under the Federal Food, Drug and Cosmetic Act, and biologics under the Public Health Service Act, the regulations promulgated under both laws and other federal, state, and local statutes and regulations.
FDA will not accept an application for a biosimilar or interchangeable product based on the reference biological product until four (4) years after the date of first licensure of the reference product, and FDA will not approve an application for a biosimilar or interchangeable product based on the reference biological product until twelve (12) years after the date of first licensure of the reference product.
FDA will not accept an application for a biosimilar or interchangeable product based on the reference biological product until four (4) years after the date of first licensure of the reference product, and FDA will not approve an application for a biosimilar or interchangeable product based on the reference biological product until twelve years after the date of first licensure of the reference product.
Within the FDA, the FDA’s Center for Biologics Evaluation and Research (“CBER”) regulates gene therapy products and has published guidance documents with respect to the development of these types of products.
Within the FDA, the FDA’s Center for Biologics Evaluation and Research regulates gene therapy products and has published guidance documents with respect to the development of these types of products.
We are obligated to make aggregate milestone payments of up to €1.4 million (approximately $1.5 million) to CIEMAT upon the achievement of specified development and regulatory milestones.
We are obligated to make aggregate milestone payments of up to €1.4 million (approximately $1.5 million) to CIEMAT Group upon the achievement of specified development and regulatory milestones.
In July 2016, we entered into a license agreement with CIEMAT granting us worldwide, exclusive rights to certain patents, know-how, data and other intellectual property relating to LVs containing the FANCA gene solely within the field of human therapeutic uses of VSV-G packaged integration component LVs for FA type-A gene therapy.
License Agreement for FA with CIEMAT Group and FIBHNJS In July 2016, we entered into a license agreement with CIEMAT Group and FIBHNJS granting us worldwide, exclusive rights to certain patents, know-how, data and other intellectual property relating to LVs containing the FANCA gene solely within the field of human therapeutic uses of VSV-G packaged integration component LVs for FA type-A gene therapy.
Most commonly, the cardiomyopathy initially manifests in the right ventricular free wall, so the disease was termed arrhythmogenic right ventricular dysplasia/cardiomyopathy (ARVD/ARVC). However, since left dominant and biventricular forms have also been observed, this has led more recently to the use of the term ACM. Mutations in the PKP2 gene comprise the most frequent genetically identified etiology of familial ACM.
Most commonly, the cardiomyopathy initially manifests in the right ventricular free wall, so the disease was termed arrhythmogenic right ventricular dysplasia/cardiomyopathy. However, since left dominant and biventricular forms have also been observed, this has led more recently to the use of the term ACM. Mutations in the PKP2 gene comprise the most frequent genetically identified etiology of familial ACM.
Fanconi Anemia Our FA patent portfolio includes granted patents in Australia, Japan, and Russia and pending applications in the U.S., Europe, Japan, China and other countries with claims directed to polynucleotide cassettes and expression vector compositions containing FA complementation group genes and methods for using such vectors to provide gene therapy in mammalian cells for treating FA.
Fanconi Anemia Our FA patent portfolio includes granted patents in Australia, Japan, South Korea, and Russia and pending applications in the U.S., Europe, Japan, China and other countries with claims directed to polynucleotide cassettes and expression vector compositions containing FA complementation group genes and methods for using such vectors to provide gene therapy in mammalian cells for treating FA.
Therefore, our products, once approved, may not obtain market acceptance unless coverage is provided, and reimbursement is adequate to cover a significant portion of the cost of our products. 27 The process for determining whether a third-party payor will provide coverage for a drug product typically is separate from the process for setting the price of a drug product or for establishing the reimbursement rate that the payor will pay for the drug product once coverage is approved.
Therefore, our products, once approved, may not obtain market acceptance unless coverage is provided, and reimbursement is adequate to cover a significant portion of the cost of our products. 31 The process for determining whether a third-party payor will provide coverage for a drug product typically is separate from the process for setting the price of a drug product or for establishing the reimbursement rate that the payor will pay for the drug product once coverage is approved.
DD is caused by mutations in the gene encoding lysosome-associated membrane protein 2 (“LAMP-2”), a mediator of autophagy. This mutation results in the accumulation of autophagic vacuoles, predominantly in cardiac and skeletal muscle. Male patients often require heart transplantation and typically die in their teens or twenties from progressive heart failure.
DD is caused by mutations in the gene encoding lysosome-associated membrane protein 2, a mediator of autophagy. This mutation results in the accumulation of autophagic vacuoles, predominantly in cardiac and skeletal muscle. Male patients often require heart transplantation and typically die in their teens or twenties from progressive heart failure.
Effective January 1, 2022, these reporting obligations extend to include transfers of value made to certain non-physician providers such as physician assistants and nurse practitioners. 29 In addition, we may be subject to data privacy and security regulation by both the federal government and the states in which we conduct our business.
Effective January 1, 2022, these reporting obligations extend to include transfers of value made to certain non-physician providers such as physician assistants and nurse practitioners. 33 In addition, we may be subject to data privacy and security regulation by both the federal government and the states in which we conduct our business.
In addition to the submission of an IND to the FDA before initiation of a clinical trial in the U.S., certain human clinical trials involving recombinant or synthetic nucleic acid molecules are subject to oversight of institutional biosafety committees (“IBCs”), as set forth in the National Institutes for Health (“NIH”) Guidelines for Research Involving Recombinant or Synthetic Nucleic Acid Molecules, or NIH Guidelines.
In addition to the submission of an IND to the FDA before initiation of a clinical trial in the U.S., certain human clinical trials involving recombinant or synthetic nucleic acid molecules are subject to oversight of institutional biosafety committees, as set forth in the National Institutes for Health Guidelines for Research Involving Recombinant or Synthetic Nucleic Acid Molecules, or NIH Guidelines.
In addition, during that time, we believe that our currently planned programs will become eligible for priority review vouchers from the FDA that provide for expedited review. We have assembled a leadership and research team with expertise in cell and gene therapy, rare disease drug development and product approval.
In addition, during that time, we believe that our currently planned programs will become eligible for priority review vouchers from the FDA that provide expedited review. We have assembled a leadership and research team with expertise in cell and gene therapy, rare disease drug development, product approval and commercial launches.
In the event that we enter into a sublicense agreement with a sublicensee, we will be obligated to pay a portion of any consideration received from such sublicensees in specified circumstances. We may terminate this agreement at any time by providing CIEMAT with 90 days advance notice.
In the event that we enter into a sublicense agreement with a sublicensee, we will be obligated to pay a portion of any consideration received from such sublicensees in specified circumstances. 21 We may terminate this agreement at any time by providing CIEMAT Group with 90 days advance notice.
We are also subject to certain diligence milestones for development of a product using the intellectual property licensed from UCSD under this agreement. The term of the license agreement with UCSD is through the expiration of the licensed patents, some of which are still in the pending application phase. REGENXBIO, Inc.
We are also subject to certain diligence milestones for development of a product using the intellectual property licensed from UCSD under this agreement. The term of the license agreement with UCSD is through the expiration of the licensed patents, some of which are still in the pending application phase.
Plakophilin-2 Arrhythmogenic Cardiomyopathy (PKP2-ACM) Arrhythmogenic cardiomyopathy (“ACM”) is an inheritable cardiac disorder that is characterized by a high propensity for arrhythmias and sudden death, a progressive loss of cardiac muscle mass, severe right ventricular dilation, dysplasia, and fibrofatty replacement of the myocardium.
Plakophilin-2 Arrhythmogenic Cardiomyopathy Arrhythmogenic cardiomyopathy (ACM) is an inheritable cardiac disorder that is characterized by a high propensity for arrhythmias and sudden death, a progressive loss of cardiac muscle mass, severe right ventricular dilation, dysplasia, and fibrofatty replacement of the myocardium.
If the sponsor chooses to submit under the Clinical Trials Directive, the clinical trial continues to be governed by the Directive and the relevant implementing legislation in each EU Member State, as required, until three years after the new Clinical Trials Regulation became applicable.
If the sponsor chose to submit under the Clinical Trials Directive, the clinical trial continues to be governed by the Directive and the relevant implementing legislation in each EU Member State, as required, until three years after the new Clinical Trials Regulation became applicable.
The PRIority MEdicines (PRIME) scheme is intended to encourage drug development in areas of unmet medical need and provides accelerated assessment of products representing substantial innovation, where the marketing authorization application will be made through the centralized procedure.
The PRIME scheme is intended to encourage drug development in areas of unmet medical need and provides accelerated assessment of products representing substantial innovation, where the marketing authorization application will be made through the centralized procedure.
Patients whose condition progresses to end-stage heart failure are considered for cardiac transplantation which, while curative of underlying disease, is itself associated with significant morbidity and mortality. Hence there exists a high unmet medical need in this population. PKP2-ACM is estimated to have a prevalence of 50,000 patients in the US and EU.
Patients whose condition progresses to end-stage heart failure are considered for cardiac transplantation which, while curative of underlying disease, is itself associated with significant morbidity and mortality. Hence there exists a high unmet medical need in this population. PKP2-ACM is estimated to have a prevalence of 50,000 patients in the U.S. and EU.
Our Phase 2 registrational enabling clinical trials treating FA patients with RP-L102 at the Center for Definitive and Curative Medicine at Stanford University School of Medicine (“Stanford”), Great Ormond Street Hospital (“GOSH”) in London and Hospital Infantil de Nino Jesus (“HNJ”) in Spain completed treatment. The trial has treated a total of 12 patients from the U.S. and EU.
Our Phase 2 registrational enabling clinical trials treating FA patients with RP-L102 at the Center for Definitive and Curative Medicine at Stanford University School of Medicine, Great Ormond Street Hospital in London and Hospital Infantil de Nino Jesus in Spain has completed treatment. The trial has treated a total of 12 patients from the U.S. and EU.
Although improvements in allogeneic (donor-mediated) hematopoietic stem cell transplant (“HSCT”), currently the most frequently utilized therapy for FA, have resulted in frequent hematologic correction of the disorder, HSCT is associated with both acute and long-term risks, including transplant-related mortality, graft failure, and graft versus host disease, a sometimes fatal side effect of allogeneic transplant characterized by painful ulcers in the GI tract, liver toxicity and skin rashes, as well as increased risk of subsequent cancers.
Although improvements in allogeneic (donor-mediated) HSCT, currently the most frequently utilized therapy for FA, have resulted in frequent hematologic correction of the disorder, HSCT is associated with both acute and long-term risks, including transplant-related mortality, graft failure, and graft versus host disease, a sometimes fatal side effect of allogeneic transplant characterized by painful ulcers in the GI tract, liver toxicity and skin rashes, as well as increased risk of subsequent cancers.
Defects in the genetic coding of HSCs can result in severe, and potentially life-threatening anemia, which is when a patient’s blood lacks enough properly functioning red blood cells to carry oxygen throughout the body.
Defects in the genetic coding of HSCs can result in severe, and potentially life-threatening anemia, when a patient’s blood lacks enough properly functioning red blood cells to carry oxygen throughout the body.
In particular, in 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, the ACA, was enacted, which, among other things, subjected biologic products to potential competition by lower-cost biosimilars; addressed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; increased the minimum Medicaid rebates owed by most manufacturers under the Medicaid Drug Rebate Program; extended the Medicaid Drug Rebate program to utilization of prescriptions of individuals enrolled in Medicaid managed care organizations; subjected manufacturers to new annual fees and taxes for certain branded prescription drugs; created a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% (increased to 70% pursuant to the Bipartisan Budget Act of 2018, effective as of January 1, 2019) point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D (which has been repealed effective 2025); and provided incentives to programs that increase the federal government’s comparative effectiveness research.
In particular, in 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, the ACA, was enacted, which, among other things, subjected biologic products to potential competition by lower-cost biosimilars; addressed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; increased the minimum Medicaid rebates owed by most manufacturers under the Medicaid Drug Rebate Program; extended the Medicaid Drug Rebate program to utilization of prescriptions of individuals enrolled in Medicaid managed care organizations; subjected manufacturers to new annual fees and taxes for certain branded prescription drugs; created a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer 50% (increased to 70% pursuant to the Bipartisan Budget Act of 2018, effective as of January 1, 2019) point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D (which ended December 31, 2024); and provided incentives to programs that increase the federal government’s comparative effectiveness research.
Pyruvate Kinase Deficiency (PKD) Red blood cell PKD is a rare autosomal recessive disorder resulting from mutations in the pyruvate kinase L/R (“PKLR”) gene encoding for a component of the red blood cell (“RBC”) glycolytic pathway.
Pyruvate Kinase Deficiency Red blood cell PKD is a rare autosomal recessive disorder resulting from mutations in the pyruvate kinase L/R gene encoding for a component of the red blood cell glycolytic pathway.
We are obligated to license (without charge) to CIEMAT for non-commercial use any improvements to the licensed intellectual property that we create. As consideration for the licensed rights, we paid CIEMAT an initial upfront license fee of €0.03 million (approximately $0.03 million) which was expensed as research and development (“R&D”) costs.
We are obligated to license (without charge) to CIEMAT Group for non-commercial use any improvements to the licensed intellectual property that we create. As consideration for the licensed rights, we paid CIEMAT Group an initial upfront license fee of €0.03 million (approximately $0.03 million) which was expensed as research and development costs.
We are obligated to license (without charge) any improvements to the licensed intellectual property that we create to CIEMAT for non-commercial use. As consideration for the licensed rights, we paid CIEMAT an initial upfront license fee of €0.1 million (approximately $0.1 million), which was expensed as R&D costs.
We are obligated to license (without charge) any improvements to the licensed intellectual property that we create to CIEMAT Group and FIBHNJS for non-commercial use. As consideration for the licensed rights, we paid CIEMAT Group and FIBHNJS an initial upfront license fee of €0.1 million (approximately $0.1 million), which was expensed as R&D costs.
In the event that we enter into a sublicense agreement with a sublicensee, we will be obligated to pay a portion of any consideration received from such sublicensees in specified circumstances. We may terminate this agreement at any time by providing CIEMAT with 90 days’ advance notice.
In the event that we enter into a sublicense agreement with a sublicensee, we will be obligated to pay a portion of any consideration received from such sublicensees in specified circumstances. We may terminate this agreement at any time by providing CIEMAT Group and FIBHNJS with 90 days’ advance notice.
Elevations in BNP are strongly associated with worsening heart failure and poor outcomes in cardiovascular disease. • High sensitivity troponin I (“hsTnI”) is a blood-based evaluation and a key marker of cardiac injury, one that is (like BNP) frequently elevated in DD patients and has been shown to be markedly elevated in patients with advanced stage disease. • Echocardiographic measurements of heart thickness, most notably, left ventricular mass and maximal left ventricular wall thickness, indicate the degree of hypertrophy present in the heart. • Kansas City Cardiovascular Questionnaire (“KCCQ”) is a validated, patient-reported outcomes assessment that measures a patients perception of their heart failure symptoms, impact of disease on physical and social function, and the impact of their heart failure on overall health status and quality of life.
Elevations in BNP are strongly associated with worsening heart failure and poor outcomes in cardiovascular disease. • High sensitivity troponin I is a blood-based evaluation and a key marker of cardiac injury, one that is (like BNP) frequently elevated in DD patients and has been shown to be markedly elevated in patients with advanced stage disease. • Echocardiographic measurements of heart thickness, most notably, left ventricular mass and maximal left ventricular wall thickness, indicate the degree of hypertrophy present in the heart. • KCCQ is a validated, patient-reported outcomes assessment that measures a patients perception of their heart failure symptoms, impact of disease on physical and social function, and the impact of their heart failure on overall health status and quality of life.
Recently Achieved Milestones In early 2023, we announced receipt of FDA RMAT and EMA PRIME designation for RP-L301 based on the robust efficacy observed in the Phase 1 treated patients. We have reached agreement with FDA on study design of Phase 2 pivotal trial of RP-L301.
Recently Achieved Milestones In May 2023, we announced receipt of FDA RMAT designation and in August 2023, we announced EMA PRIME designation for RP-L301 based on the robust efficacy observed in the Phase 1 treated patients. We have reached agreement with FDA on study design of Phase 2 pivotal trial of RP-L301.
The transitory provisions of the new Clinical Trials Regulation offer sponsors the possibility to choose between the requirements of the previous Clinical Trials Directive and the Clinical Trials Regulation if the request for authorization of a clinical trial is submitted in the year after the new Clinical Trials Regulation became applicable i.e. January 31, 2023.
The transitory provisions of the new Clinical Trials Regulation offered sponsors the possibility to choose between the requirements of the previous Clinical Trials Directive and the Clinical Trials Regulation if the request for authorization of a clinical trial is submitted in the year after the new Clinical Trials Regulation became applicable i.e. until January 31, 2023.
Mean presentation is at the age of 35, and patients have a very high lifetime risk of ventricular arrhythmias, structural ventricular abnormalities, and sudden cardiac death (“SCD”).
Mean presentation is at the age of 35, and patients have a very high lifetime risk of ventricular arrhythmias, structural ventricular abnormalities, and sudden cardiac death (SCD).
Leukocyte Adhesion Deficiency Our patent portfolio includes pending patent applications in the U.S., EU, Japan, China and other countries with claims directed to transduction of allogeneic HSCT, which may be relevant to our LAD-I program.
Leukocyte Adhesion Deficiency Our patent portfolio includes a granted patent in Russian and pending patent applications in the U.S., EU, Japan, China and other countries with claims directed to transduction of allogeneic HSCT, which may be relevant to our LAD-I program.
The process required by the FDA before a biologic may be marketed in the U.S. generally involves the following: • completion of non-clinical laboratory tests, animal studies and formulation studies conducted according to Good Laboratory Practice (“GLP”), or other applicable regulations; • submission of an IND, which allows clinical trials to begin unless FDA objects within 30 days; • performance of adequate and well-controlled human clinical trials to establish the safety and efficacy of the proposed drug or biologic for its intended use or uses conducted in accordance with FDA regulations and Good Clinical Practices (“GCP”), which are international ethical and scientific quality standards meant to ensure that the rights, safety and well-being of trial participants are protected, and that the integrity of the data is maintained; • preparation and submission to the FDA of a BLA; • submission of a user fee for FDA review of the BLA; • review of the product by an FDA advisory committee, where appropriate or if applicable; • satisfactory completion of pre-approval inspection of manufacturing facilities and clinical trial sites at which the product, 21 or components thereof, are produced to assess compliance with current Good Manufacturing Practice (“cGMP”) requirements, and if applicable, the FDA’s current Good Tissue Practice (“cGTP”) requirements, and of selected clinical trial sites to assess compliance with GCP requirements; and • FDA approval of a BLA which must occur before a biologic can be marketed or sold.
The process required by the FDA before a biologic may be marketed in the U.S. generally involves the following: • completion of non-clinical laboratory tests, animal studies and formulation studies conducted according to GLP, or other applicable regulations; • submission of an IND, which allows clinical trials to begin unless FDA objects within 30 days; • performance of adequate and well-controlled human clinical trials to establish the safety and efficacy of the proposed drug or biologic for its intended use or uses conducted in accordance with FDA regulations and Good Clinical Practices, which are international ethical and scientific quality standards meant to ensure that the rights, safety and well-being of trial participants are protected, and that the integrity of the data is maintained; • preparation and submission to the FDA of a BLA; • submission of a user fee for FDA review of the BLA; • review of the product by an FDA advisory committee, where appropriate or if applicable; • satisfactory completion of pre-approval inspection of manufacturing facilities and clinical trial sites at which the product, or components thereof, are produced to assess compliance with cGMP requirements, and if applicable, the FDA’s cGTP requirements, and of selected clinical trial sites to assess compliance with GCP requirements; and • FDA approval of a BLA which must occur before a biologic can be marketed or sold.
The Clinical Trials Regulation also makes it more efficient for EU Member States to evaluate and authorize applications together, via the Clinical Trials.
The Clinical Trials Regulation also makes it more efficient for EU Member States to evaluate and authorize applications together, via the EU CTIS portal.
This patient had more advanced disease than the four other adult/older adolescent patients who received treatment in the low and high dose cohorts, as evidenced by diminished baseline left ventricle ejection fraction (35%) on echocardiogram and markedly elevated left ventricle filling pressure prior to treatment. The patient’s clinical course was characteristic of DD progression. The patient is doing well post-transplant.
This patient had more advanced disease than the four other adult/older adolescent patients who received treatment in the low and high dose cohorts, as evidenced by diminished baseline left ventricle ejection fraction (35%) on echocardiogram and markedly elevated left ventricle filling pressure prior to treatment. The patient’s clinical course was characteristic of DD progression.
Changes in KCCQ score of +/- 5 points are considered meaningful and have been shown to correlate with outcomes. 9 • Histologic examination of endomyocardial biopsies via hematoxylin and eosin (“H&E”) histology and electron microscopy is used to detect evidence of DD-associated tissue derangements, including the presence of autophagic vacuoles and disruption of myofibrillar architecture, each of which are characteristic of DD-related myocardial damage. • LAMP2B gene expression in endomyocardial biopsy samples is measured via both immunohistochemistry and Western blot and confirms the presence of LAMP2B protein in DD cardiac tissue following RP-A501 treatment.
Changes in KCCQ score of +/- 5 points are considered meaningful and have been shown to correlate with heart failure outcomes. • Histologic examination of endomyocardial biopsies via hematoxylin and eosin histology and electron microscopy is used to detect evidence of DD-associated tissue derangements, including the presence of autophagic vacuoles and disruption of myofibrillar architecture, each of which are characteristic of DD-related myocardial damage. • LAMP2 gene expression in endomyocardial biopsy samples is measured via both immunohistochemistry and Western blot and confirms the presence of LAMP2 protein in DD cardiac tissue following RP-A501 treatment.
Along with severe cardiomyopathy, other DD-related manifestations can include skeletal muscle weakness and intellectual impairment. There are no specific therapies available for the treatment of DD and medications typically utilized for the treatment of congestive heart failure (“CHF”) are not believed to modify progression to end-stage CHF.
Along with severe cardiomyopathy, other DD-related manifestations can include skeletal muscle weakness and intellectual impairment. There are no specific therapies available for the treatment of DD and medications typically utilized for the treatment of CHF are not believed to modify progression to end-stage CHF.
Regulatory authorities, including the FDA, or IRB, or the sponsor, may suspend or terminate a clinical trial at any time on various grounds, including a finding that the participants are being exposed to an unacceptable health risk or that the clinical trial is not being conducted in accordance with FDA requirements.
Regulatory authorities, including the FDA, or Institutional Review Board, or the sponsor, may suspend or terminate a clinical trial at any time on various grounds, including a finding that the participants are being exposed to an unacceptable health risk or that the clinical trial is not being conducted in accordance with FDA requirements.
Two additional patients were treated in the US Phase 1 study at Stanford such that a total of 14 patients have received RP-L102 on Rocket-sponsored clinical trials.
Two additional patients were treated in the U.S. Phase 1 study at Stanford such that a total of 14 patients have received RP-L102 on Rocket-sponsored clinical trials.
A reference biological product is granted four (4) and twelve (12) year exclusivity periods from the time of first licensure of the product.
A reference biological product is granted four and twelve year exclusivity periods from the time of first licensure of the product.
For instance, the new Clinical Trials Regulation provides for a streamlined application procedure through the EU CTIS via a single-entry point (instead of submitting applications separately to each national competent authority and ethics committee in the Member States in which the trial will be conducted) and strictly defined deadlines for the assessment of clinical trial applications.
For instance, the new Clinical Trials Regulation provides for a streamlined application procedure through the EU CTIS via a single-entry point (instead of submitting applications for a multi-jurisdictional trial with several sites separately to each national competent authority and ethics committee in the Member States in which the trial will be conducted) and strictly defined deadlines for the assessment of clinical trial applications.
As of the data cut-off (April 17, 2023), RP-L102 conferred sustained genetic correction in eight of 12 evaluable patients and comprehensive phenotypic correction in seven of 12 evaluable patients with ≥12 months of follow up as demonstrated by increased resistance to mitomycin-C (MMC) in bone marrow-derived colony forming cells and hematologic stabilization.
As of the data cut-off (April 17, 2023), RP-L102 conferred sustained genetic correction in 8 of 12 evaluable patients and comprehensive phenotypic correction in 7 of 12 evaluable patients with ≥12 months of follow up as demonstrated by increased resistance to mitomycin-C in bone marrow-derived colony forming cells and hematologic stabilization.
The use of these therapies is driven by the arrhythmia burden and severity of cardiomyopathy. These therapies do not modify the course of the disease, and generally provide only symptomatic and/or palliative support. Upon diagnosis, a substantial percentage of patients receive an implantable cardiac defibrillator (“ICD”) for primary or secondary prevention of ventricular arrhythmias and SCD.
The use of these therapies is driven by the arrhythmia burden and severity of cardiomyopathy. These therapies do not modify the course of the disease, and generally provide only symptomatic and/or palliative support. Upon diagnosis, a substantial percentage of patients receive an ICD for primary or secondary prevention of ventricular arrhythmias and SCD.
Nonclinical studies conducted by the Sponsor, RP-A601 have demonstrated efficacy in altering the natural history of PKP2-driven ACM. 100% of PKP2 cKO animals treated with the study drug exhibited extended survival to the longest timepoint measured (5 months), reduced cardiac dilation and fibrofatty replacement/fibrosis of the myocardium, preserved left ventricular function, and mitigation of the arrhythmic phenotype.
Nonclinical studies of RP-A601 demonstrated efficacy in altering the natural history of PKP2-driven ACM. 100% of PKP2 conditional knockout (cKO) animals treated with the study drug exhibited extended survival to the longest timepoint measured (5 months), reduced cardiac dilation and fibrofatty replacement/fibrosis of the myocardium, preserved left ventricular function, and mitigation of the arrhythmic phenotype.
We are obligated to make aggregate milestone payments of up to €5.0 million (approximately $6.0 million) to CIEMAT upon the achievement of specified development and regulatory milestones.
We are obligated to make aggregate milestone payments of up to €5.0 million (approximately $5.5 million) to CIEMAT Group and FIBHNJS upon the achievement of specified development and regulatory milestones.
The multi-center Phase 1 dose escalation trial will evaluate the safety and preliminary efficacy of RP-A601 in at least six adult PKP2-ACM patients with ICDs and overall high risk for arrhythmias. The study will assess the impact of RP-A601 on PKP2 myocardial protein expression, cardiac biomarkers, and clinical predictors of life-threatening ventricular arrhythmias and sudden cardiac death.
The multi-center Phase 1 dose escalation trial is evaluating the safety and preliminary efficacy of RP-A601 in adult PKP2-ACM patients with ICDs and overall high risk for arrhythmias. The study will assess the impact of RP-A601 on PKP2 myocardial protein expression, cardiac biomarkers, and clinical predictors of life-threatening ventricular arrhythmias and sudden cardiac death.
Our common stock is listed on the NASDAQ Global Market under the symbol “RCKT.” 35
Our common stock is listed on the NASDAQ Global Market under the symbol “RCKT.” 40
A sponsor may request rare pediatric disease designation from the FDA prior to the submission of its BLA. A rare pediatric disease designation does not guarantee that a sponsor will receive a PRV upon approval of its BLA.
A sponsor may request rare pediatric disease designation from the FDA prior to the submission of its BLA. A rare pediatric disease designation does not guarantee that a sponsor will receive a priority review voucher upon approval of its BLA.
As of January 31, 2023, all applications need to be submitted under and in accordance with the Clinical Trial Regulation.
Since January 31, 2023, all applications need to be submitted under and in accordance with the Clinical Trial Regulation.
The scientific evaluation of marketing authorization applications for ATMPs is primarily performed by a specialized scientific committee called the Committee for Advanced Therapies (“CAT”). The CAT prepares a draft opinion on the quality, safety, and efficacy of the ATMP which is the subject of the marketing authorization application, which is sent for final approval to the CHMP.
The scientific evaluation of marketing authorization applications for ATMPs is primarily performed by the committee for advanced therapies (“CAT”), a committee of the European Medicines Agency (“EMA”). The CAT prepares a draft opinion on the quality, safety, and efficacy of the ATMP which is the subject of the marketing authorization application, which is sent for final approval to the CHMP.
The TCA includes specific provisions concerning pharmaceuticals, which include the mutual recognition of GMP, inspections of manufacturing facilities for medicinal products and GMP documents issued but does not foresee wholesale mutual recognition of UK and EU pharmaceutical regulations.
The TCA includes specific provisions concerning pharmaceuticals, which include the mutual recognition of GMP, inspections of manufacturing facilities for medicinal products and GMP documents issued, but does not provide for wholesale mutual recognition of U.K. and EU pharmaceutical regulations.
Post-Marketing Requirements Following approval of a new product, a pharmaceutical company and the approved product are subject to continuing regulation by the FDA, including, among other things, monitoring and recordkeeping activities, reporting to the applicable regulatory authorities of adverse experiences with the product, providing the regulatory authorities with updated safety and efficacy information, product sampling and distribution requirements, and complying with promotion and advertising requirements, which include, among others, standards for direct-to-consumer advertising, restrictions on promoting drugs for uses or in patient populations that are not described in the drug’s approved labeling, or off-label use, limitations on industry-sponsored scientific and educational activities and requirements for promotional activities involving the internet.
Fast Track designation, priority review and accelerated approval do not change the standards for approval but may expedite the development or approval process. 30 Post-Marketing Requirements Following approval of a new product, a pharmaceutical company and the approved product are subject to continuing regulation by the FDA, including, among other things, monitoring and recordkeeping activities, reporting to the applicable regulatory authorities of adverse experiences with the product, providing the regulatory authorities with updated safety and efficacy information, product sampling and distribution requirements, and complying with promotion and advertising requirements, which include, among others, standards for direct-to-consumer advertising, restrictions on promoting drugs for uses or in patient populations that are not described in the drug’s approved labeling, or off-label use, limitations on industry-sponsored scientific and educational activities and requirements for promotional activities involving the internet.
This license is only sublicensable with the prior consent of CIEMAT, not to be unreasonably withheld.
This license is only sublicensable with the prior consent of CIEMAT Group and FIBHNJS, not to be unreasonably withheld.
The FDA also has authority to require a Risk Evaluation and Mitigation Strategy (“REMS”), from manufacturers to ensure that the benefits of a drug outweigh its risks. A sponsor may also voluntarily propose a REMS as part of the BLA submission. The need for a REMS is determined as part of the review of the BLA.
The FDA also has authority to require a REMS, from manufacturers to ensure that the benefits of a drug outweigh its risks. A sponsor may also voluntarily propose a REMS as part of the BLA submission. The need for a REMS is determined as part of the review of the BLA.
Class III and IV are considered more severe or advanced heart failure. • Brain natriuretic peptide (“BNP”) is a blood-based evaluation and a key marker of heart failure with prognostic significance in CHF and cardiomyopathies.
Class III and IV are considered more severe or advanced heart failure. • BNP is a blood-based evaluation and a key marker of heart failure with prognostic significance in CHF and cardiomyopathies.
Patients receive a single intravenous infusion of RP-L102 that utilizes fresh cells and “Process B” which incorporates a modified stem cell enrichment process, transduction enhancers, as well as commercial-grade vector and final drug product.
Patients received a single intravenous infusion of RP-L102 that utilizes fresh cells and an improved process which incorporates a modified stem cell enrichment process, transduction enhancers, as well as commercial-grade vector and final drug product.
During the year ended December 31, 2023, we sold 0.9 million shares under the at-the-market offering program for gross proceeds of $17.8 million, less commissions of approximately $0.6 million for net proceeds of $17.2 million.
During the year ended December 31, 2023, we sold 0.9 million shares for gross proceeds of $17.8 million, less commissions of approximately $0.6 million, for net proceeds of $17.2 million.
In May 2023, we presented positive updated clinical data at the ASGCT 26th Annual Meeting (data cut-off May 3, 2023), which included up to 30 months of follow-up from the two treated adult patients and early clinical data from the first pediatric patient treated with RP-L301.
Both adult and pediatric enrollment is completed in the Phase 1 study. 18 In May 2023, we presented positive updated clinical data at the ASGCT 26th Annual Meeting (data cut-off May 3, 2023), which included up to 30 months of follow-up from the two treated adult patients and early clinical data from the first pediatric patient treated with RP-L301.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAmong other things, these provisions: • permit only the Board of Directors to establish the number of directors; • require super-majority voting to amend some provisions in our restated certificate of incorporation and restated bylaws; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; and • establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings. 64 Moreover, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which prohibits a person who owns in excess of 15% of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner.
Biggest changeAmong other things, these provisions: • permit only the Board of Directors to establish the number of directors; • require super-majority voting to amend some provisions in our restated certificate of incorporation and restated bylaws; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; and • establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
We have received orphan designation from the FDA and the European Commission for RP-L102 for the treatment of FA, for RP-L201 for the treatment of LAD-I, for RP-L301 for the treatment of PKD, and FDA orphan drug designation for RP-A501 for treatment of DD and RP-A601 for the treatment of PKP2-ACM.
We have received orphan designation from the FDA and the European Commission for RP-L102 for the treatment of FA, for RP-L201 for the treatment of LAD-I, RP-A601 for the treatment of PKP2-ACM, and for RP-L301 for the treatment of PKD, and FDA orphan drug designation for RP-A501 for treatment of DD.
Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized.
Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized.
We may be, and to the extent we commercialize our product candidates outside the U.S., expect to be subject to various risks associated with operating internationally, including: • different regulatory requirements for approval of drugs and biologics in foreign countries; • reduced protection for intellectual property rights; • unexpected changes in tariffs, trade barriers and regulatory requirements; • economic weakness, including inflation, or political instability in particular foreign economies and markets; • compliance with tax, employment, immigration, and labor laws for employees living or traveling abroad; • foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country; • workforce uncertainty in countries where labor unrest is more common than in the U.S.; 61 • shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; • business interruptions resulting from geopolitical actions, including war and terrorism or natural disasters including earthquakes, typhoons, floods and fires, public health crises such as pandemics and epidemics, or from economic or political instability; • compliance with foreign laws, regulations, standards, and regulatory guidance governing the collection, use, disclosure, retention, security and transfer of personal data, including the GDPR and UK GDPR; and • greater difficulty with enforcing our contracts in jurisdictions outside of the U.S.
We may be, and to the extent we commercialize our product candidates outside the U.S., expect to be subject to various risks associated with operating internationally, including: • different regulatory requirements for approval of drugs and biologics in foreign countries; • reduced protection for intellectual property rights; • unexpected changes in tariffs, trade barriers and regulatory requirements; • economic weakness, including inflation, or political instability in particular foreign economies and markets; • compliance with tax, employment, immigration, and labor laws for employees living or traveling abroad; • foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country; • workforce uncertainty in countries where labor unrest is more common than in the U.S.; • shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; • business interruptions resulting from geopolitical actions, including war and terrorism or natural disasters including earthquakes, typhoons, floods and fires, public health crises such as pandemics and epidemics, or from economic or political instability; • compliance with foreign laws, regulations, standards, and regulatory guidance governing the collection, use, disclosure, retention, security and transfer of personal data, including the GDPR and UK GDPR; and • greater difficulty with enforcing our contracts in jurisdictions outside of the U.S.
The risks we face in connection with any strategic alliance or joint venture, include: • diversion of management time and focus from operating our business to addressing integration challenges; • coordination of R&D efforts; • changes in relationships with strategic partners as a result of any product acquisitions or strategic positioning; • cultural challenges associated with integrating employees; • the need to implement or improve controls, procedures, and policies at any joint venture; • liability for activities of any partnered company prior to any strategic alliance or joint venture, including intellectual property infringement claims, violation of laws, commercial disputes, tax liabilities, and other known liabilities; • unanticipated write-offs or charges; and • litigation or other claims, including claims from employees, customers, former stockholders or other third parties Our failure to address these risks or other problems encountered in connection with our past or future strategic alliances could cause us to fail to realize the anticipated benefits of these transactions, cause us to incur unanticipated liabilities and harm the business generally.
The risks we face in connection with any strategic alliance or joint venture, include: • diversion of management time and focus from operating our business to addressing integration challenges; • coordination of R&D efforts; • changes in relationships with strategic partners as a result of any product acquisitions or strategic positioning; • cultural challenges associated with integrating employees; • the need to implement or improve controls, procedures, and policies at any joint venture; • liability for activities of any partnered company prior to any strategic alliance or joint venture, including intellectual property infringement claims, violation of laws, commercial disputes, tax liabilities, and other known liabilities; • unanticipated write-offs or charges; and 66 • litigation or other claims, including claims from employees, customers, former stockholders or other third parties Our failure to address these risks or other problems encountered in connection with our past or future strategic alliances could cause us to fail to realize the anticipated benefits of these transactions, cause us to incur unanticipated liabilities and harm the business generally.
In addition, to the extent we seek to obtain regulatory approval for our product candidates in foreign countries, our ability to successfully initiate, enroll and complete a clinical study in any foreign country is subject to numerous risks unique to conducting business in foreign countries, including: • difficulty in establishing or managing relationships with Contract Research Organizations (“CROs”) and physicians; • absence in some countries of established groups with sufficient regulatory expertise for review of LV and AAV gene therapy protocols; • our inability to locate qualified local partners or collaborators for such clinical trials; and • the potential burden of complying with a variety of foreign laws, medical standards and regulatory requirements, including the regulation of pharmaceutical and biotechnology products and treatment.
In addition, to the extent we seek to obtain regulatory approval for our product candidates in foreign countries, our ability to successfully initiate, enroll and complete a clinical study in any foreign country is subject to numerous risks unique to conducting business in foreign countries, including: • difficulty in establishing or managing relationships with Contract Research Organizations and physicians; • absence in some countries of established groups with sufficient regulatory expertise for review of LV and AAV gene therapy protocols; • our inability to locate qualified local partners or collaborators for such clinical trials; and • the potential burden of complying with a variety of foreign laws, medical standards and regulatory requirements, including the regulation of pharmaceutical and biotechnology products and treatment.
A clinical trial may be delayed or halted at any stage of testing for various reasons, including: • failure of patients to enroll in the studies at the rate we expect; • ineffectiveness of our product candidates; • patients experiencing unexpected side effects or other safety concerns being raised during treatment; 38 • changes in governmental regulations or administrative actions; • failure to conduct studies in accordance with required clinical practices; • inspection of clinical study operations or study sites by the FDA, the EMA or other regulatory authorities, resulting in a clinical hold; • insufficient financial resources; • insufficient supplies of drug product to treat patients in our ongoing and planned clinical trials; • political unrest or natural disasters at domestic or foreign clinical sites; • a shutdown of the U.S. government, including the FDA; • public health crises such as pandemics and epidemics.
A clinical trial may be delayed or halted at any stage of testing for various reasons, including: • failure of patients to enroll in the studies at the rate we expect; • ineffectiveness of our product candidates; 43 • patients experiencing unexpected side effects or other safety concerns being raised during treatment; • changes in governmental regulations or administrative actions; • failure to conduct studies in accordance with required clinical practices; • inspection of clinical study operations or study sites by the FDA, the EMA or other regulatory authorities, resulting in a clinical hold; • insufficient financial resources; • insufficient supplies of drug product to treat patients in our ongoing and planned clinical trials; • political unrest or natural disasters at domestic or foreign clinical sites; • a shutdown of the U.S. government, including the FDA; • public health crises such as pandemics and epidemics.
Any of these occurrences may harm our ability to develop other product candidates, and may harm our business, financial condition and prospects significantly. 40 Risks Related to Government Regulation Our gene therapy product candidates are based on novel technology, which makes it difficult to predict the time and cost of product candidate development and subsequently obtaining regulatory approval.
Any of these occurrences may harm our ability to develop other product candidates, and may harm our business, financial condition and prospects significantly. Risks Related to Government Regulation Our gene therapy product candidates are based on novel technology, which makes it difficult to predict the time and cost of product candidate development and subsequently obtaining regulatory approval.
This may be onerous and if our efforts to comply with GDPR or other applicable laws, rules, regulations and standards are not successful, or are perceived to be unsuccessful, it could adversely affect our business. Further, following the July 2020 Court of Justice of the EU (“CJEU”) decision invalidating the EU-U.S.
This may be onerous and if our efforts to comply with GDPR or other applicable laws, rules, regulations and standards are not successful, or are perceived to be unsuccessful, it could adversely affect our business. Further, following the July 2020 Court of Justice of the EU decision invalidating the EU-U.S.
For example, recent court decisions raise questions regarding the award of patent term adjustment (“PTA”) for patents in families where related patents have issued without PTA. Thus, it cannot be said with certainty how PTA will/will not be viewed in the future and whether patent expiration dates may be impacted.
For example, recent court decisions raise questions regarding the award of patent term adjustment for patents in families where related patents have issued without patent term adjustment. Thus, it cannot be said with certainty how PTA will/will not be viewed in the future and whether patent expiration dates may be impacted.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees. Risks Related to Our Expansion and Growth Plans We may need to expand our organization and may experience difficulties in managing this growth, which could disrupt our operations.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees. 65 Risks Related to Our Expansion and Growth Plans We may need to expand our organization and may experience difficulties in managing this growth, which could disrupt our operations.
In the EU, marketing authorization may be granted to a similar medicinal product for the same orphan indication if: • the second applicant can establish in its application that its medicinal product, although similar to the orphan medicinal product already authorized, is safer, more effective or otherwise clinically superior; • the holder of the marketing authorization for the original orphan medicinal product consents to a second orphan medicinal product application; or • the holder of the marketing authorization for the original orphan medicinal product cannot supply sufficient quantities of orphan medicinal product. 42 A Fast Track or regenerative medicine advanced therapy, or RMAT, designation by the FDA, or a PRIority MEdicines, or PRIME, designation by the EMA, even if granted for any of our current or future product candidates, may not lead to a faster development or regulatory review or approval process, and does not increase the likelihood that our current product candidate and any future product candidates will receive marketing approval.
In the EU, marketing authorization may be granted to a similar medicinal product for the same orphan indication if: • the second applicant can establish in its application that its medicinal product, although similar to the orphan medicinal product already authorized, is safer, more effective or otherwise clinically superior; • the holder of the marketing authorization for the original orphan medicinal product consents to a second orphan medicinal product application; or • the holder of the marketing authorization for the original orphan medicinal product cannot supply sufficient quantities of orphan medicinal product. 47 A Fast Track or regenerative medicine advanced therapy, or RMAT, designation by the FDA, or a PRIority MEdicines, or PRIME, designation by the EMA, even if granted for any of our current or future product candidates, may not lead to a faster development or regulatory review or approval process, and does not increase the likelihood that our current product candidate and any future product candidates will receive marketing approval.
Under the Federal Food, Drug, and Cosmetic Act (“FDCA”), we will need to request a rare pediatric disease priority review voucher in our original BLA for our product candidates for which we have received rare pediatric disease designation.
Under the Federal Food, Drug, and Cosmetic Act, we will need to request a rare pediatric disease priority review voucher in our original BLA for our product candidates for which we have received rare pediatric disease designation.
Any failure or perceived failure by us or our vendors or service providers to comply with our applicable policies or notices relating to privacy or data protection, our contractual or other obligations to third parties, or any of our other legal obligations, laws, rules, regulations and standards relating to privacy or data protection, may result in governmental investigations or enforcement actions, litigation, claims and other proceedings, harm our reputation, and could result in significant liability. 48 We are subject to environmental, health and safety laws and regulations, and we may become exposed to liability and substantial expenses in connection with environmental compliance or remediation activities.
Any failure or perceived failure by us or our vendors or service providers to comply with our applicable policies or notices relating to privacy or data protection, our contractual or other obligations to third parties, or any of our other legal obligations, laws, rules, regulations and standards relating to privacy or data protection, may result in governmental investigations or enforcement actions, litigation, claims and other proceedings, harm our reputation, and could result in significant liability. 53 We are subject to environmental, health and safety laws and regulations, and we may become exposed to liability and substantial expenses in connection with environmental compliance or remediation activities.
We cannot guarantee that any of these studies will ultimately be successful or that preclinical or early-stage clinical studies will support further clinical advancement or regulatory approval of our product candidates. 39 From time to time, we may publicly disclose interim or topline data from our preclinical studies and clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial.
We cannot guarantee that any of these studies will ultimately be successful or that preclinical or early-stage clinical studies will support further clinical advancement or regulatory approval of our product candidates. 44 From time to time, we may publicly disclose interim or topline data from our preclinical studies and clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial.
Under the unitary patent system, European applications have the option, upon grant of a patent, of becoming a Unitary Patent subject to the jurisdiction of the Unitary Patent Court (“UPC”). As the UPC is a new court system, there is no precedent for the court, increasing the uncertainty of any litigation.
Under the unitary patent system, European applications have the option, upon grant of a patent, of becoming a Unitary Patent subject to the jurisdiction of the UPC. As the UPC is a new court system, there is no precedent for the court, increasing the uncertainty of any litigation.
If any of the physicians or other healthcare providers or entities with whom we expect to do business are found to be not in compliance with applicable laws, they may be subject to significant criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs. 47 We are subject to stringent laws, rules, regulations, policies, industry standards and contractual obligations regarding data privacy and security and may be subject to additional related laws and regulations in jurisdictions into which we expand.
If any of the physicians or other healthcare providers or entities with whom we expect to do business are found to be not in compliance with applicable laws, they may be subject to significant criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs. 52 We are subject to stringent laws, rules, regulations, policies, industry standards and contractual obligations regarding data privacy and security and may be subject to additional related laws and regulations in jurisdictions into which we expand.
Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market could decrease our ability to generate product revenue, and our business, financial condition, results of operations and prospects would be materially harmed. 41 Even though we have obtained orphan designation for certain of our product candidates, we may not be able to realize the benefits of such designation, including potential marketing exclusivity of our product candidates, if approved.
Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market could decrease our ability to generate product revenue, and our business, financial condition, results of operations and prospects would be materially harmed. 46 Even though we have obtained orphan designation for certain of our product candidates, we may not be able to realize the benefits of such designation, including potential marketing exclusivity of our product candidates, if approved.
Although we are not currently aware of any gene therapy competitors addressing any of the same indications as those in our pipeline, we may have competitors both in the U.S. and internationally, including major multinational pharmaceutical companies, biotechnology companies and universities and other research institutions. 51 Our potential competitors may have substantially greater financial, technical and other resources, such as larger R&D staff, more robust manufacturing capabilities and more experienced marketing and manufacturing organizations.
Although we are not currently aware of any gene therapy competitors addressing any of the same indications as those in our pipeline, we may have competitors both in the U.S. and internationally, including major multinational pharmaceutical companies, biotechnology companies and universities and other research institutions. 56 Our potential competitors may have substantially greater financial, technical and other resources, such as larger R&D staff, more robust manufacturing capabilities and more experienced marketing and manufacturing organizations.
Additionally, recent volatility in capital markets, rising interest rates and lower market prices for securities generally may affect our ability to access new capital on terms favorable to us, which may harm our liquidity, limit our ability to grow our business, pursue acquisitions or improve our operating infrastructure and restrict our ability to compete in our markets. 37 Our operations have consumed significant amounts of cash since inception.
Additionally, recent volatility in capital markets, rising interest rates and lower market prices for securities generally may affect our ability to access new capital on terms favorable to us, which may harm our liquidity, limit our ability to grow our business, pursue acquisitions or improve our operating infrastructure and restrict our ability to compete in our markets. 42 Our operations have consumed significant amounts of cash since inception.
Further, the shift would likely be expensive and time-consuming, particularly since the new facility would need to comply with the necessary regulatory requirements or may require approval before selling any products manufactured at that facility. 49 We have limited experience in manufacturing, and there can be no assurance that we will be able to manufacture products at the scale our business may require.
Further, the shift would likely be expensive and time-consuming, particularly since the new facility would need to comply with the necessary regulatory requirements or may require approval before selling any products manufactured at that facility. 54 We have limited experience in manufacturing, and there can be no assurance that we will be able to manufacture products at the scale our business may require.
Though we carefully manage our relationships with our CROs, we cannot guarantee that we will not encounter similar challenges or delays in the future or that these delays or challenges will not have a material adverse effect on our business, financial condition or results of operations. 53 We may not be successful in finding strategic collaborators for continuing development of certain of our product candidates or successfully commercializing our product candidates.
Though we carefully manage our relationships with our CROs, we cannot guarantee that we will not encounter similar challenges or delays in the future or that these delays or challenges will not have a material adverse effect on our business, financial condition or results of operations. 58 We may not be successful in finding strategic collaborators for continuing development of certain of our product candidates or successfully commercializing our product candidates.
A successful product liability claim or series of claims brought against us, particularly if judgments exceed our insurance coverage, could decrease our cash and adversely affect our business. 50 Risks Related to Commercialization of our Product Candidates Our ability to successfully develop and commercialize our product candidates will substantially depend upon the availability of reimbursement for the costs of the resulting drugs and related treatments.
A successful product liability claim or series of claims brought against us, particularly if judgments exceed our insurance coverage, could decrease our cash and adversely affect our business. 55 Risks Related to Commercialization of our Product Candidates Our ability to successfully develop and commercialize our product candidates will substantially depend upon the availability of reimbursement for the costs of the resulting drugs and related treatments.
Cost overruns, unanticipated regulatory delays or demands, unexpected adverse side effects or insufficient therapeutic efficacy will prevent or substantially slow our R&D effort and our business could ultimately suffer. Risks Related to Third Parties We rely on third parties to conduct certain aspects of our preclinical studies and clinical trials and perform other tasks for us.
Cost overruns, unanticipated regulatory delays or demands, unexpected adverse side effects or insufficient therapeutic efficacy will prevent or substantially slow our R&D efforts and our business could ultimately suffer. Risks Related to Third Parties We rely on third parties to conduct certain aspects of our preclinical studies and clinical trials and perform other tasks for us.
Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved, or commercialized in a timely manner or at all, which could negatively impact our business.
Disruptions at the FDA and other government agencies caused by funding shortages, Executive Orders, or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, approved, or commercialized in a timely manner or at all, which could negatively impact our business.
In the U.S., a variety of data privacy, protection and security laws, rules, regulations and standards potentially may apply to our activities, such as state data breach notification laws, state personal data privacy laws (for example, the California Consumer Privacy Act of 2018 as amended by the California Privacy Rights Act effective January 1, 2023 (“CCPA”)), state health information privacy laws, and federal and state consumer protection laws.
In the U.S., a variety of data privacy, protection and security laws, rules, regulations and standards potentially may apply to our activities, such as state data breach notification laws, state personal data privacy laws (for example, the CCPA of 2018 as amended by the California Privacy Rights Act effective January 1, 2023, state health information privacy laws, and federal and state consumer protection laws.
We may have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market our medicines effectively. 36 The amount of and our ability to use net operating losses and research and development credits to offset future taxable income may be subject to certain limitations and uncertainty.
We may have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market our medicines effectively. 41 The amount of and our ability to use net operating losses and research and development credits to offset future taxable income may be subject to certain limitations and uncertainty.
Additionally, if the steps taken to maintain our trade secrets are deemed inadequate, we may have insufficient recourse against third parties for misappropriating our trade secrets. 56 We may not be successful in obtaining or maintaining necessary rights to gene therapy product components and processes for our development pipeline through acquisitions and in-licenses.
Additionally, if the steps taken to maintain our trade secrets are deemed inadequate, we may have insufficient recourse against third parties for misappropriating our trade secrets. 61 We may not be successful in obtaining or maintaining necessary rights to gene therapy product components and processes for our development pipeline through acquisitions and in-licenses.
Our primary focus is on our R&D activities and the clinical testing and commercialization of our product candidates, and we anticipate that we will remain principally engaged in these activities for an indeterminate, but substantial, period. R&D was our most significant operating expense for the year ended December 31, 2023.
Our primary focus is on our R&D activities and the clinical testing and commercialization of our product candidates, and we anticipate that we will remain principally engaged in these activities for an indeterminate, but substantial, period. R&D was our most significant operating expense for the year ended December 31, 2024.
As a result, our intellectual property may not provide sufficient rights to exclude others from commercializing products similar or identical to ours. 55 If we breach our license agreements, it could have a material adverse effect on our commercialization efforts for our product candidates.
As a result, our intellectual property may not provide sufficient rights to exclude others from commercializing products similar or identical to ours. 60 If we breach our license agreements, it could have a material adverse effect on our commercialization efforts for our product candidates.
Such a loss of patent protection would have a material adverse impact on our business. 57 Changes in U.S. patent law or the patent law of other countries or jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.
Such a loss of patent protection would have a material adverse impact on our business. 62 Changes in U.S. patent law or the patent law of other countries or jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.
As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours. 58 Intellectual property rights do not necessarily address all potential threats.
As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours. 63 Intellectual property rights do not necessarily address all potential threats.
Any of these scenarios could decrease demand for any products for which we obtain marketing approval. 52 Risks Related to Development of our Pipeline and Research and Development Activities We may not be successful in our efforts to expand our pipeline of additional product candidates for development.
Any of these scenarios could decrease demand for any products for which we obtain marketing approval. 57 Risks Related to Development of our Pipeline and Research and Development Activities We may not be successful in our efforts to expand our pipeline of additional product candidates for development.
We believe that quarterly comparisons of our financial results are not necessarily meaningful and should not be relied upon as an indication of our future performance. RTW Investments, LP, our largest stockholder, may have the ability to significantly influence all matters submitted to stockholders for approval.
We believe that quarterly comparisons of our financial results are not necessarily meaningful and should not be relied upon as an indication of our future performance. 68 RTW, our largest stockholder, may have the ability to significantly influence all matters submitted to stockholders for approval.
Substantially all our operating losses have resulted from costs incurred in connection with our R&D programs, buildout of our manufacturing capabilities and from general and administrative (“G&A”) costs associated with our operations.
Substantially all our operating losses have resulted from costs incurred in connection with our R&D programs, buildout of our manufacturing capabilities and from general and administrative costs associated with our operations.
The CJEU’s decision and other regulatory guidance or developments may impose additional obligations with respect to the transfer of personal data from the EU to the U.S., all of which could restrict our activities in those jurisdictions, limit our ability to provide our products and services in those jurisdictions, require us to modify our policies and practices, and to engage in additional contractual negotiations, or increase our costs and obligations and impose limitations upon our ability to efficiently transfer personal data from the EU to the U.S.
The Court of Justice of the EU’s decision and other regulatory guidance or developments may impose additional obligations with respect to the transfer of personal data from the EU to the U.S., all of which could restrict our activities in those jurisdictions, limit our ability to provide our products and services in those jurisdictions, require us to modify our policies and practices, and to engage in additional contractual negotiations, or increase our costs and obligations and impose limitations upon our ability to efficiently transfer personal data from the EU to the U.S.
The authority for the FDA to award rare pediatric disease priority review vouchers for biological products after September 30, 2024 is currently limited to biological products that receive rare pediatric disease designation on or prior to September 30, 2024, and FDA may only award rare pediatric disease priority review vouchers through September 30, 2026.
The authority for the FDA to award rare pediatric disease priority review vouchers for biological products after December 31, 2024 is currently limited to biological products that receive rare pediatric disease designation on or prior to December 20, 2024, and FDA may only award rare pediatric disease priority review vouchers through September 30, 2026.
For example, FDA’s CBER may require us to perform additional nonclinical studies or clinical trials that may increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of our gene therapy product candidates or lead to significant post-approval limitations or restrictions.
For example, FDA’s Center for Biologics Evaluation and Research may require us to perform additional nonclinical studies or clinical trials that may increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of our gene therapy product candidates or lead to significant post-approval limitations or restrictions.
In addition, any acquisition or business combination may impact the market price for shares of our common stock, which could result in substantial losses for our stockholders. 60 In addition, in connection with any potential acquisition of businesses, technologies or products in the future, we could, among other things: • issue equity securities that would dilute our current stockholders’ percentage ownership; • incur substantial debt that may place strains on our operations; • assume substantial actual or contingent liabilities; • reprioritize our development programs and even cease development and commercialization of certain of our product candidates; or • merge with, or otherwise enter into a business combination with, another company in which our stockholders would receive cash or shares of the other company on terms that certain of our stockholders may not deem desirable.
In addition, in connection with any potential acquisition of businesses, technologies or products in the future, we could, among other things: • issue equity securities that would dilute our current stockholders’ percentage ownership; • incur substantial debt that may place strains on our operations; • assume substantial actual or contingent liabilities; • reprioritize our development programs and even cease development and commercialization of certain of our product candidates; or • merge with, or otherwise enter into a business combination with, another company in which our stockholders would receive cash or shares of the other company on terms that certain of our stockholders may not deem desirable.
In addition, the EMA’s Committee for Advanced Therapies (“CAT”) and other regulatory review committees and advisory groups and any new guidelines they promulgate may lengthen the regulatory review process, require us to perform additional studies, increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of our product candidates or lead to significant post-approval limitations or restrictions.
In addition, the EMA’s CAT and other regulatory review committees and advisory groups and any new guidelines they promulgate may lengthen the regulatory review process, require us to perform additional studies, increase our development costs, lead to changes in regulatory positions and interpretations, delay or prevent approval and commercialization of our product candidates or lead to significant post-approval limitations or restrictions.
Competing products, either developed by the collaborators or strategic partners or to which the collaborators or strategic partners have rights, may result in the withdrawal of our collaborator’s or partner’s support for our product candidates. Some of our collaborators or strategic partners could also become our competitors in the future.
Competing products, either developed by the collaborators or strategic partners or to which the collaborators or strategic partners have rights, may result in the withdrawal of our collaborators’ or partners’ support for our product candidates. Some of our collaborators or strategic partners could also become our competitors in the future.
Our collaborators or strategic partners could develop competing products, preclude us from entering into collaborations with their competitors, fail to obtain timely regulatory approvals, terminate their agreements with us prematurely, or fail to devote sufficient resources to the development and commercialization of our product candidates. Any of these developments could harm our product development efforts.
Our collaborators or strategic partners could develop competing products, preclude us from entering into collaborations with their competitors, fail to obtain timely regulatory approvals, terminate their agreements with us prematurely, or fail to devote sufficient resources to the development and commercialization of our product candidates.
RTW Investments, LP (“RTW”), in the aggregate, beneficially owns approximately 20.21% of our outstanding shares of common stock. This concentration of voting power gives RTW the power to significantly influence all matters submitted to our stockholders for approval, as well as our management and affairs.
RTW Investments, LP, in the aggregate, beneficially owns approximately 17.1% of our outstanding shares of common stock. This concentration of voting power gives RTW the power to significantly influence all matters submitted to our stockholders for approval, as well as our management and affairs.
For example, the collection and use of health data and other personal data including data collected in clinical trials is governed in the EU by the General Data Protection Regulation (“GDPR”), which imposes substantial obligations upon companies and new rights for individuals.
For example, the collection and use of health data and other personal data including data collected in clinical trials is governed in the EU by the GDPR, which imposes substantial obligations upon companies and new rights for individuals.
A weak or declining economy could also strain our suppliers, possibly resulting in supply disruption. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate, further political developments and financial market conditions could adversely impact our business.
A weak or declining economy could also strain our suppliers, possibly resulting in supply disruption. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate, further political developments and financial market conditions could adversely impact our business. Item 1B. Unresol ved SEC Comments None.
We have historically relied on third parties to manufacture supplies of our product candidates. We have completed a build-out of a new manufacturing facility in Cranbury, New Jersey, and have recently completed two DD AAV cGMP production batches.
We have historically relied on third parties to manufacture supplies of our product candidates. We have completed a build-out of a manufacturing facility in Cranbury, New Jersey, and have since completed a limited number of DD AAV cGMP batches.
We and our vendors are required to comply with the current requirements of GMP, good clinical practice (“GCP”), and good laboratory practice (“GLP”), which are a collection of laws and regulations enforced by the FDA, the EMA or comparable foreign authorities for our drug candidates in clinical development.
We and our vendors are required to comply with the current requirements of GMP, GCP, and GLP, which are a collection of laws and regulations enforced by the FDA, the EMA or comparable foreign authorities for our drug candidates in clinical development.
It is difficult to predict what the CMS will decide with respect to reimbursement for fundamentally novel products such as ours, as there is no body of established practices and precedents for these new products.
Private payors tend to follow the CMS to a substantial degree. It is difficult to predict what the CMS will decide with respect to reimbursement for fundamentally novel products such as ours, as there is no body of established practices and precedents for these new products.
As of December 31, 2023, our cash, cash equivalents and investments were $407.5 million. Our future capital requirements will depend on numerous factors, many of which are outside of our control.
As of December 31, 2024, our cash, cash equivalents and investments were $372.3 million. Our future capital requirements will depend on numerous factors, many of which are outside of our control.
If we fail to comply with applicable regulatory requirements following approval of any of our product candidates, a regulatory agency may take a variety of actions, including: • issuing a warning letter asserting that we are in violation of the law; • seeking an injunction or impose civil or criminal penalties or monetary fines; • suspending any ongoing clinical studies; • refusing to approve a pending marketing application, such as a BLA or supplements to a BLA submitted by us; • seizing products; or • refusing to allow us to enter into supply contracts, including government contracts.
If we fail to comply with applicable regulatory requirements following approval of any of our product candidates, a regulatory agency may take a variety of actions, including: • issuing a warning letter asserting that we are in violation of the law; • seeking an injunction or impose civil or criminal penalties or monetary fines; • suspending any ongoing clinical studies; • refusing to approve a pending marketing application, such as a BLA or supplements to a BLA submitted by us; • seizing products; or • refusing to allow us to enter into supply contracts, including government contracts. 50 In addition, the FDA’s policies, and those of comparable foreign regulatory authorities, may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
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 which we may have obtained and we may not achieve or sustain profitability, which would materially harm our business, financial condition, results of operations and prospects. 45 If approved, our product candidates may face competition from biosimilars approved through an abbreviated regulatory pathway.
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 which we may have obtained and we may not achieve or sustain profitability, which would materially harm our business, financial condition, results of operations and prospects.
Currently, relatively few gene and cell therapy products have received marketing authorization in the U.S. or the EU, including Novartis Pharmaceuticals’ Kymriah and Zolgensma (developed by AveXis), Kite Pharma’s Yescarta, GlaxoSmithKline’s Strimvelis, Spark Therapeutics’ Luxturna, Vertex Pharmaceuticals’ Casgevy and Bluebird Bio’s Lyfgenia.
Currently, relatively few gene and cell therapy products have received marketing authorization in the U.S. or the EU, including Zolgensma (developed by AveXis), GlaxoSmithKline’s Strimvelis, Spark Therapeutics’ Luxturna, Vertex Pharmaceuticals’ Casgevy, Bluebird Bio’s Lyfgenia, Pfizer’s Beqvez, Sarepta Therapeutics’ Elevidys and Orchard Therapeutics’ Lenmeldy.
If any such adverse events occur, our clinical trials could be suspended or terminated. Under certain circumstances, the FDA, the European Commission, the EMA or other regulatory authorities could order us to cease further development of, or deny approval of, our product candidates for any or all targeted indications.
Under certain circumstances, the FDA, the European Commission, the EMA or other regulatory authorities could order us to cease further development of, or deny approval of, our product candidates for any or all targeted indications.
We incurred net losses of $245.6 million, $221.9 million and $169.1 million for the years ended December 31, 2023, 2022 and 2021, respectively. As of December 31, 2023, we had an accumulated deficit of $959.4 million.
We incurred net losses of $258.7 million, $245.6 million and $221.9 million for the years ended December 31, 2024, 2023 and 2022, respectively. As of December 31, 2024, we had an accumulated deficit of $1.22 billion.
Therefore, while the regulatory regime in Great Britain may in part still align with EU regulations, the UK has now implemented new regulations and administrative processes for pharmaceutical processes, including the process for obtaining marketing authorizations in the UK (through a national marketing authorization or an IRP as described above) and, for clinical trials through the application of the UK Clinical Trial Regulation and the implementation of the combined review process by MHRA and HRA.
Accordingly, the regulatory regime in Great Britain no longer aligns with EU regulations as regards regulations and administrative processes for pharmaceutical processes, including the process for obtaining marketing authorizations in the UK (through a national marketing authorization or an IRP as described above) and, for clinical trials through the application of the UK Clinical Trial Regulation and the implementation of the combined review process by MHRA and HRA.
Our stock price is likely to be volatile. The stock market in general, and the market for biopharmaceutical companies in particular, has experienced extreme volatility that has often been unrelated to the operating performance of particular companies.
The price of our common stock may be volatile and fluctuate substantially, which could result in substantial losses for our stockholders. Our stock price is likely to be volatile. The stock market in general, and the market for biopharmaceutical companies in particular, has experienced extreme volatility that has often been unrelated to the operating performance of particular companies.
Any of the foregoing scenarios could materially harm the commercial prospects for our product candidates and materially harm our business, financial condition, results of operations and prospects. 44 We may never obtain FDA or EMA approval for any of our product candidates in the U.S. or the EU, and even if we do, we may never obtain approval for or commercialize any of our product candidates in any other jurisdiction, which would limit our ability to realize our full market potential.
We may never obtain FDA or EMA approval for any of our product candidates in the U.S. or the EU, and even if we do, we may never obtain approval for or commercialize any of our product candidates in any other jurisdiction, which would limit our ability to realize our full market potential.
When new technologies are developed with government funding, the government generally obtains certain rights in any resulting patents, including a non-exclusive license authorizing the government to use the invention for non-commercial purposes.
As a result, the government may have march-in rights, or other rights, to such patent rights and technology. When new technologies are developed with government funding, the government generally obtains certain rights in any resulting patents, including a non-exclusive license authorizing the government to use the invention for non-commercial purposes.
If our licensors fail to maintain such patents, or lose rights to those patents or patent applications, the rights we have licensed may be reduced or eliminated and our right to develop and commercialize any of our products that are the subject of such licensed rights could be impacted.
If our licensors fail to maintain such patents, or lose rights to those patents or patent applications, the rights we have licensed may be reduced or eliminated and our right to develop and commercialize any of our products that are the subject of such licensed rights could be impacted. 59 Furthermore, the research resulting in certain of our licensed patent rights and technology was funded by the U.S. government.
If one or more of these analysts cease to cover our stock or fail to regularly publish reports on us, we could lose visibility in the market for our stock, which in turn could cause our stock price to decline. 62 The price of our common stock may be volatile and fluctuate substantially, which could result in substantial losses for our stockholders.
If one or more of these analysts cease to cover our stock or fail to regularly publish reports on us, we could lose visibility in the market for our stock, which in turn could cause our stock price to decline.
A product may be eligible for accelerated approval by the FDA if it treats a serious or life-threatening condition, generally provides a meaningful advantage over available therapies, and demonstrates an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit.
While we may utilize trial designs to support accelerated approval, such product candidates may not be subject to faster development or regulatory review timelines. 48 A product may be eligible for accelerated approval by the FDA if it treats a serious or life-threatening condition, generally provides a meaningful advantage over available therapies, and demonstrates an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit.
The ACA includes a subtitle called the BPCIA, which created an abbreviated approval pathway for biologic products that are biosimilar to or interchangeable with an FDA-licensed reference biologic product.
If approved, our product candidates may face competition from biosimilars approved through an abbreviated regulatory pathway. The ACA includes a subtitle called the BPCIA, which created an abbreviated approval pathway for biologic products that are biosimilar to or interchangeable with an FDA-licensed reference biologic product.
Additionally, the Consolidated Appropriations Act of 2023, enacted on December 29, 2022, contained revisions to the accelerated approval process that provide FDA with additional authority to enforce the post-market study requirements and withdraw approvals more rapidly when holders of accelerated approvals fail to comply with post-approval clinical study requirements. 43 In the EU, the conditional marketing authorization is subject to an annual renewal procedure that assesses the marketing authorization holder’s compliance with the specific obligations of the authorization.
Additionally, the Consolidated Appropriations Act of 2023, enacted on December 29, 2022, contained revisions to the accelerated approval process that provide FDA with additional authority to enforce the post-market study requirements and withdraw approvals more rapidly when holders of accelerated approvals fail to comply with post-approval clinical study requirements.
The United Kingdom’s withdrawal from the EU, or Brexit, could result in increased regulatory and legal complexity, which may make it more difficult for us to do business in Europe and impose additional challenges in securing regulatory approval of our product candidates in Europe and/or the United Kingdom.
This could reduce the ultimate demand for our drugs or put pressure on our drug pricing, which could negatively affect our business, financial condition, results of operations and prospects. 51 The United Kingdom’s withdrawal from the EU, or Brexit, could result in increased regulatory and legal complexity, which may make it more difficult for us to do business in Europe and impose additional challenges in securing regulatory approval of our product candidates in Europe and/or the United Kingdom.
Further, any delay in compliance with the auditor attestation provisions of Section 404 could subject us to a variety of administrative sanctions, including ineligibility for short-form resale registration, action by the SEC and the suspension or delisting of our common stock, which could reduce the trading price of our common stock and could harm our business.
Further, any delay in compliance with the auditor attestation provisions of Section 404 could subject us to a variety of administrative sanctions, including ineligibility for short-form resale registration, action by the SEC and the suspension or delisting of our common stock, which could reduce the trading price of our common stock and could harm our business. 69 Provisions in our corporate charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.
These sales, or the perception or the perception that such sales may occur, could reduce the market price of our common stock.
Sales of a substantial number of shares of our common stock in the public market could occur at any time. These sales, or the perception or the perception that such sales may occur, could reduce the market price of our common stock.
Regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide that our data are insufficient for approval and require additional preclinical, clinical or other studies. In addition, varying interpretations of data obtained from preclinical and clinical testing could delay, limit or prevent the receipt of marketing approval for a product candidate.
Regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide that our data are insufficient for approval and require additional preclinical, clinical or other studies.
Risks Related to Ownership of our Common Stock Future sales of our common stock in the public market could cause the market price of our common stock to drop significantly, even if our business is performing well. Sales of a substantial number of shares of our common stock in the public market could occur at any time.
Any of these developments could harm our product development efforts. 67 Risks Related to Ownership of our Common Stock Future sales of our common stock in the public market could cause the market price of our common stock to drop significantly, even if our business is performing well.
We are highly dependent upon the efforts of our senior management, including our Chief Executive Officer, Gaurav Shah, MD; our President and Chief Operating Officer, Kinnari Patel, PharmD, MBA; our Chief Business Officer and Senior Vice President, Raj Prabhakar; our Chief Medical Officer, Mark White, MB.ChB; our Vice President of Finance, Treasurer, Principal Accounting Officer and Interim Principal Financial Officer, John Militello; and our General Counsel, Chief Compliance Officer and Senior Vice President, Martin Wilson.
We are highly dependent upon the efforts of our senior management, including our Chief Executive Officer, Gaurav Shah, MD; our President, Head of R&D and Chief Operating Officer, Kinnari Patel, PharmD, MBA; our Chief Financial Officer, Aaron Ondrey; our Chief Business Officer and Senior Vice President, Raj Prabhakar; and our General Counsel, Chief Corporate Officer and Senior Vice President, Martin Wilson.
Licenses to additional third-party technology that may be required for our licensing or development programs may not be available in the future or may not be available on commercially reasonable terms, or at all, which could materially harm our business and financial condition. 54 In some circumstances, we may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain or enforce the patents, covering technology that we license from third parties.
Licenses to additional third-party technology that may be required for our licensing or development programs may not be available in the future or may not be available on commercially reasonable terms, or at all, which could materially harm our business and financial condition.
Initially, the EU and the UK concluded a trade and cooperation agreement, or TCA, which was provisionally applicable since January 1, 2021 and has been formally applicable since May 1, 2021.
There was a transition period during which EU pharmaceutical laws continued to apply to the UK, which expired on December 31, 2020. Initially, the EU and the UK concluded a trade and cooperation agreement, or TCA, which was provisionally applicable since January 1, 2021 and has been formally applicable since May 1, 2021.
The clinical study requirements of the FDA, the EMA, and other regulatory agencies and the criteria these regulators use to determine the safety and efficacy of a product candidate vary substantially according to the type, complexity, novelty and intended use and market of the potential products.
We have concentrated our R&D efforts to date on a gene therapy platform, and our future success depends on the successful development of viable gene therapy product candidates. 45 The clinical study requirements of the FDA, the EMA, and other regulatory agencies and the criteria these regulators use to determine the safety and efficacy of a product candidate vary substantially according to the type, complexity, novelty and intended use and market of the potential products.
There is intense competition among major pharmaceutical and chemical companies, specialized biotechnology firms and universities and other research institutions for qualified personnel in the areas of our operations, and we may be unsuccessful in attracting and retaining these personnel. 59 Our employees, principal investigators, consultants, and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading.
There is intense competition among major pharmaceutical and chemical companies, specialized biotechnology firms and universities and other research institutions for qualified personnel in the areas of our operations, and we may be unsuccessful in attracting and retaining these personnel.
See the section entitled, “ Business — Government Regulation — Coverage and Reimbursement .” In the U.S., the principal decisions about coverage and reimbursement for new medicines are typically made by the Centers for Medicare & Medicaid Services (“CMS”), an agency within the U.S.
See the section entitled, “ Business — Government Regulation — Coverage and Reimbursement .” In the U.S., the principal decisions about coverage and reimbursement for new medicines are typically made by the CMS, an agency within the HHS, as CMS decides whether and to what extent a new medicine will be covered and reimbursed under Medicare.
We currently have clinical trial sites in the United Kingdom, contract laboratories in the United Kingdom conducting testing for our global clinical trials, and other collaborators and potential collaborators in the United Kingdom and throughout Europe.
We currently have clinical trial sites in the United Kingdom, contract laboratories in the United Kingdom conducting testing for our global clinical trials, and other collaborators and potential collaborators in the United Kingdom and throughout Europe. Pursuant to Article 50 of the Treaty on EU, the UK ceased being a Member State of the EU on January 31, 2020.
As a result, capital appreciation, if any, of our common stock will be stockholders’ sole source of gain for the foreseeable future. 63 General Risk Factors Our limited operating history may make it difficult for us to evaluate the success of our business to date and to assess our future viability.
General Risk Factors Our limited operating history may make it difficult for us to evaluate the success of our business to date and to assess our future viability.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees. Risks Related to Personnel and Expansion of our Company Risks Related to our Personnel Our business could suffer if it loses the services of, or fails to attract, key personnel.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.
We are exposed to the risk of fraud or other misconduct by our employees, consultants, and commercial partners.
Our employees, principal investigators, consultants, and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading. We are exposed to the risk of fraud or other misconduct by our employees, consultants, and commercial partners.
Regulatory authorities also may approve a product candidate for more limited indications than requested or they may impose significant limitations in the form of narrow indications, warnings or other labeling changes. These regulatory authorities may require precautions or contra-indications with respect to conditions of use or they may grant approval subject to the performance of costly post-marketing clinical trials.
These regulatory authorities may require precautions or contra-indications with respect to conditions of use or they may grant approval subject to the performance of costly post-marketing clinical trials. Regulatory authorities may impose restrictions and conditions on product distribution, prescribing, or dispensing in the form of a Risk Evaluation and Mitigation Strategy, or REMS, or equivalent requirement.
In addition, the FDA’s policies, and those of comparable foreign regulatory authorities, may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates. We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative actions, either in the U.S. or abroad.
We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative actions, either in the U.S. or abroad.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAdditionally, members of the IT security team have cybersecurity experience and\or certifications, such as the Certified Information Systems Security Professional certification and Certified Information Systems Audit certification. We view cybersecurity as a shared responsibility across our management team, and plan to periodically perform simulations and tabletop exercises at a management level and incorporate external resources and advisors as needed.
Biggest changeThe Company views cybersecurity as a shared responsibility across our management team and plans to periodically perform simulations and tabletop exercises at a management level and incorporate external resources and advisors as needed. All employees are required to complete cybersecurity training at least once annually and have access to more frequent cybersecurity training through online and live events.
The cybersecurity team briefs the Audit Committee and General Counsel and Chief Compliance Officer on the effectiveness of the Company’s cyber risk management program, generally on a quarterly basis. In addition, cybersecurity risks will be reviewed by the Board of Directors, at least annually, as part of the Company’s corporate risk mapping exercise.
The cybersecurity team briefs the Audit Committee, Chief Financial Officer, General Counsel and Chief Compliance Officer on the effectiveness of the Company’s cyber risk management program, generally on a quarterly basis. In addition, cybersecurity risks will be reviewed by the Board of Directors, at least annually, as part of the Company’s corporate risk mapping exercise.
The Audit Committee, in addition to the Company’s General Counsel and Chief Compliance Officer, oversees the Company’s cybersecurity risk exposures and the steps taken by management to monitor and mitigate cybersecurity risks.
The Audit Committee, in addition to the Company’s Chief Financial Officer, General Counsel and Chief Compliance Officer, oversees the Company’s cybersecurity risk exposures and the steps taken by management to monitor and mitigate cybersecurity risks.
We continue to invest in the cybersecurity and resiliency of our infrastructure and the enhancement of our internal controls and processes, which are designed to help protect our systems and data, and the information they contain. For more information regarding the risks we face from cybersecurity threats, please see “Risk Factors.”
We continue to invest in cybersecurity and the resilience of our infrastructure and the enhancement of our internal controls and processes, which are designed to help protect our systems and data, and the information they contain. For more information regarding the risks we face from cybersecurity threats, please see “Risk Factors.”
The Company is enhancing its processes for oversight of third-party vendors, including appropriate due diligence for new providers and continuous monitoring following implementation, including ongoing direct contact with vendor personnel. Third-party vendors are re-evaluated at regular intervals as part of our supplier qualification process.
The Company is continuously enhancing its processes for oversight of third-party vendors, including appropriate due diligence for new providers and continuous monitoring, including ongoing direct contact with vendor personnel. Third-party vendors are re-evaluated at regular intervals as part of our supplier qualification process .
Our CISO is responsible for continuously monitoring and assessing the Company’s cybersecurity risk management program, informing senior management regarding the prevention, detection, mitigation, and remediation of cybersecurity incidents and supervising such efforts.
Our Chief Information Security Officer is responsible for continuously monitoring and assessing the Company’s cybersecurity risk management program, informing senior management regarding the prevention, detection, mitigation, and remediation of cybersecurity incidents, and supervising such efforts.
We have not experienced any material cybersecurity incidents in the past, and we believe no cybersecurity events have occurred that have materially affected the Company or its business strategy, results of operations or financial condition.
We have not experienced any material cybersecurity incidents to date, and, by default, we believe no cybersecurity events have occurred that have materially affected the Company or its business strategy , results of operations or financial condition.
The program is integrated within the Company’s enterprise risk management framework and addresses both the corporate information technology environment and the external facing ecosystem. 65 The underlying controls of the cybersecurity risk management program are based on recognized best practices and standards for cybersecurity and information technology, including the National Institute of Standards and Technology (“NIST”) Cybersecurity Framework (“CSF”) and the International Organization for Standardization (“ISO”) 27001 Information Security Management System Requirements.
The program is integrated within the Company’s enterprise risk management framework and addresses both the corporate information technology environment and the external ecosystem . 70 The underlying controls of the cybersecurity risk management program are based on recognized best practices and standards for cybersecurity and information technology.
Our VP, Head of Information Technology is the Company’s designated Chief Information Security Officer (“CISO”) and is responsible for developing and implementing the cybersecurity risk management program and reporting on cybersecurity matters to the Board. The VP, Head of Information Technology has over twenty years of experience leading cybersecurity oversight.
The cybersecurity risk management program includes administrative, physical, and technical controls . Our VP, Head of Information Technology is the Company’s designated Chief Information Security Officer (CISO) and is responsible for developing and implementing the cybersecurity risk management program, including and reporting on cybersecurity matters to the Board.
Employees outside of our corporate information security organization also have a role in our cybersecurity defenses and they are immersed in a corporate culture supportive of security, which we believe improves our cybersecurity.
We also require employees in certain roles to complete additional role-based, specialized cybersecurity training that is documented in our quality management system. Employees outside of our corporate information security organization also have a role in our cybersecurity defenses and they are immersed in a corporate culture supportive of security, which we believe improves our cybersecurity .
The Company will have a third party perform an annual assessment of the Company’s cybersecurity risk management program against the NIST CSF. The Company has a Cyber Security Operations Center monitoring our global cybersecurity environment and coordinates investigations and remediation of alerts.
The Company has a third party perform an annual assessment of the Company’s cybersecurity risk management program. The Company has a Cyber Security Operations Center monitoring our global cybersecurity environment and coordinates investigations and remediation of alerts. We are enhancing our programs for staging incident response drills to prepare support teams for a significant incident.
Removed
We are enhancing our programs for staging incident response drills to prepare support teams in the event of a significant incident. The cybersecurity risk management program includes controls for organizational processes, personnel, physical facilities and equipment, and technological controls.
Added
The VP, Head of Information Technology has over twenty years of experience leading cybersecurity oversight. Additionally, members of the IT security team have cybersecurity experience and/or certifications, such as the Certified Information Systems Security Professional and Certified Information Systems Audit credential.
Removed
All employees will be required to complete cybersecurity training at least once annually and have access to more frequent cybersecurity training through online and live events. We also require employees in certain roles to complete additional role-based, specialized cybersecurity training that is documented in our quality management system.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe Company intends to sublease these facilities and signed a sublease agreement for one of the Hopewell, NJ facilities in January 2024. 66 Facility in Cambridge, Massachusetts As part of the acquisition of Renovacor, we assumed a sublease agreement for approximately 5,945 square feet of office space in Cambridge, Massachusetts that expires in April 2024.
Biggest changeThe Company intends to sublease these facilities and signed the first sublease agreement for one of the Hopewell, NJ facilities in January 2024. 71
The NJ Lease Agreement has an initial term ending in 2034, with an option to renew for an additional two consecutive five-year renewal terms. In addition, we lease space in New York, New York at the Empire State Building, which consists of approximately 6,600 square feet of office space under a lease that expires in July 2024.
The NJ Lease Agreement has an initial term ending in 2034, with an option to renew for an additional two consecutive five-year renewal terms. In addition, we lease space in New York, New York at the Empire State Building, which consists of approximately 6,600 square feet of office space under a lease that expires in July 2027.
Rocket leases an additional 4,666 square feet storage facility in Dayton, New Jersey. Facilities in Hopewell, New Jersey As part of the acquisition of Renovacor, we assumed lease agreements for approximately 15,463 square feet of space in Hopewell, New Jersey that expires in March 2033.
Rocket leases an additional 4,666 square feet storage facility in Dayton, New Jersey. Facilities in Hopewell, New Jersey As part of the acquisition of Renovacor, we added lease agreements for approximately 15,463 square feet of space in Hopewell, New Jersey that expires in March 2033.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeRegardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. Item 4. Mine S afety Disclosures Not Applicable. 67 PAR T II
Biggest changeRegardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. Item 4. Mine S afety Disclosures Not Applicable. 72 PAR T 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 The information required by Item 5 of Form 10-K regarding equity compensation plans is incorporated herein by reference to Item 12 of Part III of this Annual Report on Form 10-K. 68 Recent Sales of Unregistered Securities None.
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The information required by Item 5 of Form 10-K regarding equity compensation plans is incorporated herein by reference to Item 12 of Part III of this Annual Report on Form 10-K. 73 Recent Sales of Unregistered Securities On December 9, 2024, the Company entered into a Subscription Agreement (the “Subscription Agreement”) with RTW Innovation Master Fund, Ltd.
Stock Performance Graph The graph set forth below compares the cumulative total stockholder return on our common stock between January 1, 2019 and December 31, 2023 with the cumulative total return of (a) the NASDAQ Biotechnology Index and (b) the NASDAQ Composite Index, over the same period.
Stock Performance Graph The graph set forth below compares the cumulative total stockholder return on our common stock between December 31, 2019 and December 31, 2024 with the cumulative total return of (a) the NASDAQ Biotechnology Index and (b) the NASDAQ Composite Index, over the same period.
This graph assumes the investment of $100 on January 1, 2019 of our common stock, the NASDAQ Biotechnology Index and the NASDAQ Composite Index and assumes the reinvestment of dividends, if any. The comparisons shown in the graph below are based upon historical data.
This graph assumes the investment of $100 on December 31, 2019 of our common stock, the NASDAQ Biotechnology Index and the NASDAQ Composite Index and assumes the reinvestment of dividends, if any. The comparisons shown in the graph below are based upon historical data.
We caution that the stock price performance shown in the graph below is not necessarily indicative of, nor is it intended to forecast, the potential future performance of our common stock. Stockholders As of February 22, 2024, there were 32 stockholders of record, which excludes stockholders whose shares were held in nominee or street name by brokers.
We caution that the stock price performance shown in the graph below is not necessarily indicative of, nor is it intended to forecast, the potential future performance of our common stock. Stockholders As of February 21, 2025, there were 31 stockholders of record, which excludes stockholders whose shares were held in nominee or street name by brokers.
There has been no material change in the planned use of proceeds from our September 2023 Public Offering as described in the prospectus supplement related to the offering. Issuer Purchases of Equity Securities There were no repurchases of our common stock during the year ended December 31, 2023. Item 6. Re served
There has been no material change in the planned use of proceeds from the Offering and Private Placement as described in the prospectus supplement related to the Offering. Issuer Purchases of Equity Securities There were no repurchases of our common stock during the year ended December 31, 2024. Item 6. Re served
Item 5. Market for Registrant’s Common Equity, Re lated Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is traded on the NASDAQ Global Market under the symbol “RCKT”. On February 22, 2024, the last reported sale price for our common stock on the Nasdaq Global Market was $29.00 per share.
Item 5. Market for Registrant’s Common Equity, Re lated Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is traded on the NASDAQ Global Market under the symbol “RCKT”. On February 21, 2025, the last reported sale price for our common stock on the Nasdaq Global Market was $10.47 per share.
The offer and sale of the shares and pre-funded warrants were registered under the Securities Act pursuant to a prospectus supplement, filed with the SEC on September 15, 2023, to the Company’s effective registration statement on Form S-3 (Registration No. 333-253756), which was previously filed with the SEC, and declared effective on September 10, 2021.
The Offering and sale of the shares was registered under the Securities Act pursuant to a prospectus supplement, filed with the SEC on December 12, 2024 to the Company’s effective registration statement on Form S-3 (Registration No. 333-281606), which was previously filed with the SEC, and declared effective on August 16, 2024.
Use of Proceeds from Public Offering of Common Stock On September 15, 2023, we completed a Public Offering of approximately 9.5 million shares of our common stock at a public offering price of $16.00 per share and pre-funded warrants to purchase 3.1 million shares of common stock at a price of $15.99 per warrant (“September 2023 Public Offering”).
Use of Proceeds from Public Offerings of Common Stock and Private Placement On December 12, 2024, we completed the Offering of approximately 15.2 million shares of our common stock at a public offering price of $12.50 per share and Private Placement of pre-funded warrants to purchase 0.4 million shares of common stock at a price of $12.49 per warrant.
The gross proceeds from the September 2023 Public Offering were approximately $201.3 million, net of $12.4 million of offering costs, underwriting discounts and commissions, legal and other expenses for net proceeds from the offering of $188.9 million.
The gross proceeds from the Offering and Private Placement of pre-funded warrants were approximately $194.7 million, net of $12.2 million of offering costs, underwriting discounts and commissions, legal and other expenses for net proceeds from the Offering and Private Placement of pre-funded warrants of $182.5 million.
Added
(the “Investor”) pursuant to which the Investor agreed to purchase in a private placement pre-funded warrants representing the right to purchase 0.4 million shares of our common stock, at the offering price of $12.49 per pre-funded warrant (which equals the public offering price per share of common stock in the Offering (as defined below) less the $0.01 per share exercise price of each such pre-funded warrant) (the “Private Placement”).
Added
The Private Placement closed on December 12, 2024, concurrently with the closing of a public offering of approximately 15.2 million shares of our common stock at a public offering price of $12.50 per share (the “Offering”).
Added
The pre-funded warrants issued in the Private Placement were offered and sold in reliance upon the exemption from the registration set forth under Section 4(a)(2) of the Securities Act, and the regulations promulgated thereunder relating to sales by an issuer not involving any public offering, and in reliance on similar exemptions under applicable state laws.

Item 7. Management's Discussion & Analysis

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

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Biggest changeDuring the year ended December 31, 2022, net cash provided by financing activities was $155.3 million, consisting primarily of proceeds related to the October 2022 Public Offering of $108.1 million and issuance of common stock through our at-the-market offering program of $46.6 million. 76 During the year ended December 31, 2021, net cash provided by financing activities was $37.7 million, consisting of proceeds from the issuance of common stock related to a private placement in August 2021 of $26.4 million and issuance of common stock, pursuant to exercises of stock options, of $11.3 million.
Biggest changeFinancing Activities During year ended December 31, 2024, net cash provided by financing activities was $185.7 million, consisting primarily of proceeds related to the December 12, 2024 public offering of $182.5 million and $3.2 million from the exercise of stock options.
Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 The following table summarizes our results of operations, in thousands, for each of the periods presented: For the Years Ended December 31, 2023 2022 Change Operating expenses: Research and development $ 186,342 $ 165,570 $ 20,772 General and administrative 73,317 58,773 14,544 Total operating expenses 259,659 224,343 35,316 Loss from operations (259,659 ) (224,343 ) (35,316 ) Research and development incentives - 500 (500 ) Interest expense (1,875 ) (1,862 ) (13 ) Interest and other income, net 5,288 3,889 1,399 Accretion of discount and amortization of premium on investments, net 10,651 (47 ) 10,698 Total other income, net 14,064 2,480 11,584 Net loss $ (245,595 ) $ (221,863 ) $ (23,732 ) Research and Development Expenses R&D expenses increased $20.8 million to $186.3 million for the year ended December 31, 2023, compared to the year ended December 31, 2022.
Comparison of the Years Ended December 31, 2023 and 2022 The following table summarizes our results of operations, in thousands, for each of the periods presented: For the Years Ended December 31, 2023 2022 Change Operating expenses: Research and development $ 186,342 $ 165,570 $ 20,772 General and administrative 73,317 58,773 14,544 Total operating expenses 259,659 224,343 35,316 Loss from operations (259,659 ) (224,343 ) (35,316 ) Research and development incentives - 500 (500 ) Interest expense (1,875 ) (1,862 ) (13 ) Interest and other income, net 5,288 3,889 1,399 Accretion of discount and amortization of premium on investments, net 10,651 (47 ) 10,698 Total other income, net 14,064 2,480 11,584 Net loss $ (245,595 ) $ (221,863 ) $ (23,732 ) Research and Development Expenses R&D expenses increased $20.8 million to $186.3 million for the year ended December 31, 2023, compared to the year ended December 31, 2022.
This is due to the numerous risks and uncertainties associated with product development and commercialization, including the uncertainty of: • the scope, progress, outcome and costs of our clinical trials and other R&D activities; • the efficacy and potential advantages of our product candidates compared to alternative treatments, including any standard of care; • the market acceptance of our product candidates; • obtaining, maintaining, defending, and enforcing patent claims and other intellectual property rights; • significant and changing government regulation; and • the timing, receipt, and terms of any marketing approvals.
This is due to the numerous risks and uncertainties associated with product development and commercialization, including the uncertainty of: • the scope, progress, outcome and costs of our clinical trials and other R&D activities; • the efficacy and potential advantages of our product candidates compared to alternative treatments, including any standard of care; • the market acceptance of our product candidates; • obtaining, maintaining, defending, and enforcing patent claims and other intellectual property rights; 77 • significant and changing government regulation; and • the timing, receipt, and terms of any marketing approvals.
This update requires expanded annual and interim disclosures for significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. This update will be effective for fiscal years beginning after December 15, 2023, and is to be applied retrospectively to all periods presented in the financial statements.
This update requires expanded annual and interim disclosures for significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. This update is effective for fiscal years beginning after December 15, 2023, and is to be applied retrospectively to all periods presented in the financial statements.
Costs to close out the study were incurred in 2022. 71 We cannot determine with certainty the duration and costs to complete current or future clinical studies of product candidates or if, when, or to what extent we will generate revenues from the commercialization and sale of any of our product candidates that obtain regulatory approval.
Costs to close out the study were incurred in 2022. We cannot determine with certainty the duration and costs to complete current or future clinical studies of product candidates or if, when, or to what extent we will generate revenues from the commercialization and sale of any of our product candidates that obtain regulatory approval.
The Company performed the qualitative assessment of its goodwill and determined that it is more likely than not that the fair value of a reporting unit exceeds the carrying value of the reporting unit. As a result, the Company has determined there was no goodwill impairment as of and for the years ended December 31, 2023, 2022 and 2021.
The Company performed the qualitative assessment of its goodwill and determined that it is more likely than not that the fair value of a reporting unit exceeds the carrying value of the reporting unit. As a result, the Company has determined there was no goodwill impairment as of and for the years ended December 31, 2024, 2023 and 2022.
Investing Activities During the year ended December 31, 2023, net cash used in investing activities was $98.1 million, primarily resulting from proceeds of $309.3 million from the maturities of investments, offset by purchases of investments of $390.9 million, and purchases of property and equipment of $16.5 million.
During the year ended December 31, 2023, net cash used in investing activities was $98.1 million, primarily resulting from proceeds of $309.3 million from the maturities of investments, offset by purchases of investments of $390.9 million, and purchases of property and equipment of $16.4 million.
We expect such resources would be sufficient to fund our operating expenses and capital expenditure requirements into 2026. We have funded our operations primarily through the sale of equity.
We expect such resources would be sufficient to fund our operating expenses and capital expenditure requirements into the third quarter of 2026. We have funded our operations primarily through the sale of equity.
If our development efforts for product candidates are successful and result in regulatory approval or license agreements with third parties, we may generate revenue in the future from product sales. 70 Research and Development Expenses Our R&D program expenses consist primarily of external costs incurred for the development of our product candidates.
If our development efforts for product candidates are successful and result in regulatory approval or license agreements with third parties, we may generate revenue in the future from product sales. Research and Development Expenses Our R&D program expenses consist of both internal and external costs incurred for the development of our product candidates.
No impairment of the IPR&D asset was recognized and the mice colony model was impaired and written off during the year ended December 31, 2023. 77 Accrued R&D Expenses As part of the process of preparing our consolidated financial statements, we are required to estimate our accrued R&D expenses.
No impairment of the IPR&D asset was recorded for the years ended December 31, 2024 and 2023. The mice colony model was impaired and written off during the year ended December 31, 2023. 82 Accrued R&D Expenses As part of the process of preparing our consolidated financial statements, we are required to estimate our accrued R&D expenses.
During the year ended December 31, 2023, we sold 0.9 million shares under the at-the-market offering program for gross proceeds of $17.8 million, less commissions of approximately $0.6 million for net proceeds of $17.2 million.
During the year ended December 31, 2023, we sold 0.9 million shares for gross proceeds of $17.8 million, less commissions of approximately $0.6 million, for net proceeds of $17.2 million.
Intangible Assets Intangible assets consisted of indefinite lived intangible in process research and development (“IPR&D”) assets and a mice colony model. Intangible assets related to IPR&D projects are considered to be indefinite-lived until the completion or abandonment of the associated R&D efforts.
Intangible Assets Intangible assets consisted of IPR&D assets and a mice colony model. Intangible assets related to IPR&D projects are considered to be indefinite-lived until the completion or abandonment of the associated R&D efforts.
Financing Activities During year ended December 31, 2023, net cash provided by financing activities was $208.4 million, consisting primarily of proceeds related to the September 2023 Public Offering of $188.9 million, $17.2 million from issuance of common stock through our at-the-market offering program and $2.2 million from the exercise of stock options.
During year ended December 31, 2023, net cash provided by financing activities was $208.4 million, consisting primarily of proceeds related to the September 15, 2023 public offering of $188.9 million, $17.2 million from issuance of common stock through our at-the-market offering program and $2.2 million from the exercise of stock options. 81 During the year ended December 31, 2022, net cash provided by financing activities was $155.3 million, consisting primarily of proceeds related to the October 6, 2022 public offering of $108.1 million and issuance of common stock through our at-the-market offering program of $46.6 million.
Critical Accounting Policies and Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”).
Critical Accounting Policies and Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in conformity with U.S. GAAP.
We have three clinical-stage ex vivo lentiviral vector (“LV”) programs, which include programs for: • Fanconi Anemia (“FA”), a genetic defect in the bone marrow that reduces production of blood cells or promotes the production of faulty blood cells; • Leukocyte Adhesion Deficiency-I (“LAD-I”), a genetic disorder that causes the immune system to malfunction; and • Pyruvate Kinase Deficiency (“PKD”), a red blood cell autosomal recessive disorder that results in chronic non-spherocytic hemolytic anemia.
We also have three clinical-stage ex vivo lentiviral (LV) programs, which include programs for: • Leukocyte Adhesion Deficiency-I (LAD-I), a genetic disorder that causes the immune system to malfunction (RP-L201); • Fanconi Anemia (FA), a genetic defect in the bone marrow that reduces production of blood cells or promotes the production of faulty blood cells (RP-L102) and • Pyruvate Kinase Deficiency (PKD), a red blood cell autosomal recessive disorder that results in chronic non-spherocytic hemolytic anemia (RP-L301).
If a triggering event occurs that would indicate a potential impairment, the Company will perform a quantitative analysis to determine whether it is more likely than not that the fair value is below carrying amount.
If a triggering event occurs that would indicate a potential impairment, the Company will perform a quantitative analysis to determine whether it is more likely than not that the fair value is below carrying amount. The annual impairment assessment for the IPR&D asset was performed as of December 1.
This update standardizes categories for the effective tax rate reconciliation, requires disaggregation of income taxes and additional income tax-related disclosures. This update is required to be effective for the Company for fiscal periods beginning after December 15, 2024.
This update standardizes categories for the effective tax rate reconciliation, requires disaggregation of income taxes and additional income tax-related disclosures. This update was required to be effective for the Company for fiscal periods beginning after December 15, 2024. The Company is evaluating the effect that ASU 2023-09 will have on its financial statements and disclosures.
Financial Statements and Supplementary Data.” We do not have any off-balance sheet arrangements that are material or reasonably likely to become material to our financial condition or results of operations. 75 Cash Flows The following table summarizes our cash flows from operating, investing and financing activities, in thousands, for each of the periods presented: For the Years Ended December 31, 2023 2022 2021 Net cash used in operating activities $ (194,916 ) $ (178,142 ) $ (121,163 ) Net cash (used in) provided by investing activities (98,066 ) (69,326 ) 18,853 Net cash provided by financing activities 208,401 155,288 37,681 Net decrease in cash, cash equivalents and restricted cash $ (84,581 ) $ (92,180 ) $ (64,629 ) Operating Activities During the year ended December 31, 2023, operating activities used $194.9 million of cash and cash equivalents, primarily resulting from our net loss of $245.6 million offset by net non-cash charges of $37.2 million, including non-cash stock-based compensation expense of $39.4 million, depreciation and amortization expense of $7.1 million, impairment of acquired intangible asset and write down of property and equipment of $0.9 million, partially offset by accretion of discount on investments of $10.2 million.
Financial Statements and Supplementary Data.” We do not have any off-balance sheet arrangements that are material or reasonably likely to become material to our financial condition or results of operations. 80 Cash Flows The following table summarizes our cash flows from operating, investing and financing activities, in thousands, for each of the periods presented: For the Years Ended December 31, 2024 2023 2022 Net cash used in operating activities $ (209,724 ) $ (194,916 ) $ (178,142 ) Net cash provided by/(used in) investing activities 131,706 (98,066 ) (69,326 ) Net cash provided by financing activities 185,739 208,401 155,288 Net increase (decrease) in cash, cash equivalents and restricted cash $ 107,721 $ (84,581 ) $ (92,180 ) Operating Activities During the year ended December 31, 2024, operating activities used $209.7 million of cash and cash equivalents, primarily resulting from our net loss of $258.7 million offset by net non-cash charges of $47.1 million, including non-cash stock-based compensation expense of $43.9 million, depreciation, amortization expense of $9.4 million and change in fair value of warrant liabilities of $1.9 million, partially offset by accretion of discount on investments of $8.1 million.
During the year ended December 31, 2021, net cash provided by investing activities was $18.9 million, consisting of proceeds of $272.4 million from the maturities of investments, offset by purchases of investments of $245.9 million, and purchases of property and equipment of $7.6 million.
Investing Activities During the year ended December 31, 2024, net cash provided by investing activities was $131.7 million, primarily resulting from proceeds of $383.5 million from the maturities of investments, offset by purchases of investments of $245.9 million, and purchases of property and equipment of $5.9 million.
Years Ended December 31, 2023 2022 2021 Direct Expenses: Danon Disease (AAV) RP-A501 $ 28,992 $ 28,524 $ 15,804 Plakophilin-2 Arrhythmogenic Cardiomyopathy (AAV) RP-A601 7,171 11,724 1,071 Leukocyte Adhesion Deficiency (LVV) RP-L201 17,725 20,617 24,222 Fanconi Anemia (LVV) RP-L102 25,276 23,917 15,453 Pyruvate Kinase Deficiency (LVV) RP-L301 4,808 2,744 4,206 Infantile Malignant Osteopetrosis (LVV) RP-L401 (1) - 271 2,236 Other product candidates 5,501 3,580 3,504 Total direct expenses 89,473 91,377 66,496 Unallocated Expenses: Employee compensation $ 46,867 $ 32,274 $ 20,780 Non-cash R&D expense related to the issuance of warrants - - 12,781 Stock based compensation expense 17,509 12,465 11,954 Depreciation and amortization expense 5,375 4,037 5,130 Laboratory and related expenses 17,618 17,405 3,359 Professional fees 3,927 3,601 1,797 Other expenses 5,573 4,411 3,179 Total other research and development expenses 96,869 74,193 58,980 Total research and development expense $ 186,342 $ 165,570 $ 125,476 (1) Effective December 2021, a decision was made to no longer pursue Rocket-sponsored clinical evaluation of RP-L401; this program was returned to academic innovators.
Years Ended December 31, 2024 2023 2022 Direct Expenses: Danon Disease RP-A501 $ 23,677 $ 28,992 $ 28,524 Plakophilin-2 Arrhythmogenic Cardiomyopathy RP-A601 6,595 7,171 11,724 Leukocyte Adhesion Deficiency-I RP-L201 14,376 17,725 20,617 Fanconi Anemia RP-L102 17,749 25,276 23,917 Pyruvate Kinase Deficiency RP-L301 9,145 4,808 2,744 Infantile Malignant Osteopetrosis RP-L401 (1) - 271 Other product candidates 9,768 5,501 3,580 Total direct expenses 81,310 89,473 91,377 Unallocated Expenses: Employee compensation $ 49,040 $ 46,867 $ 32,274 Stock based compensation expense 18,784 17,509 12,465 Depreciation and amortization expense 6,023 5,375 4,037 Laboratory and related expenses 5,170 17,618 17,405 Professional fees 4,831 3,927 3,601 Other expenses 6,086 5,573 4,411 Total other research and development expenses 89,934 96,869 74,193 Total research and development expense $ 171,244 $ 186,342 $ 165,570 (1) Effective December 2021, a decision was made to no longer pursue Rocket-sponsored clinical evaluation of RP-L401; this program was returned to academic innovators.
We do not have any products approved for sale and have not generated any revenue from product sales. From inception through December 31, 2023, we raised net cash proceeds of approximately $1.0 billion from investors through both equity and convertible debt financing to fund operating activities.
From inception through December 31, 2024, we raised net cash proceeds of approximately $1.2 billion from investors through both equity and convertible debt financing to fund operating activities. 75 Revenue To date, we have not generated any revenue from any sources, including from product sales, and we do not expect to generate any revenue from the sale of products in the near future.
Other Income, Net Other income, net increased by $4.3 million to $2.5 million for the year ended December 31, 2022, compared to the year ended December 31, 2021.
Other Income, Net Other income, increased by $0.4 million to $14.5 million for the year ended December 31, 2024, compared to the year ended December 31, 2023.
Changes in our operating assets and liabilities for the year ended December 31, 2021 consisted of a decrease in accounts payable and accrued expenses of $4.8 million and a decrease in prepaid expenses and other assets of $1.3 million.
Changes in our operating assets and liabilities for the year ended December 31, 2024 included an increase in accounts payable and accrued expenses of $6.1 million, decrease in other liabilities of $3.7 million, and an increase in our prepaid expenses and other assets of $0.7 million.
Recent Developments At-the-Market Offering Program On February 28, 2022, we entered into a Sales Agreement with Cowen with respect to an at-the-market offering program pursuant to which we may offer and sell, from time to time at our sole discretion, shares through Cowen as our sales agent.
Recent Developments At-the-Market Offering Program On February 28, 2022, we entered into a sales agreement (the “Sales Agreement”) with Cowen with respect to an at-the-market offering program pursuant to which we could offer and sell, from time to time at our sole discretion, shares of our common stock, par value $0.01 per share, having an aggregate offering price of up to $200 million through Cowen as our sales agent.
The DD program is currently in an ongoing Phase 2 trial. • Plakophilin-2 Arrhythmogenic Cardiomyopathy (“PKP2-ACM”), an inheritable cardiac disorder that is characterized by a progressive loss of cardiac muscle mass, severe right ventricular dilation, dysplasia, fibrofatty replacement of the myocardium and a high propensity to arrhythmias and sudden death.
The DD program is currently in an ongoing Phase 2 trial (RP-A501). • Plakophilin-2 Arrhythmogenic Cardiomyopathy (PKP2-ACM), an inheritable cardiac disorder that is characterized by a progressive loss of cardiac muscle mass, severe right ventricular dilation, dysplasia, fibrofatty replacement of the myocardium and a high propensity to arrhythmias and sudden death (RP-A601). • BAG3 Dilated Cardiomyopathy (BAG3-DCM), which is the most common form of cardiomyopathy and is characterized by progressive thinning of the walls of the heart resulting in enlarged heart chambers that are unable to pump blood.
Rocket has incurred net losses and negative cash flows from its operations each year since inception. Rocket incurred net losses of $245.6 million, $221.9 million, and $169.1 million for the years ended December 31, 2023, 2022 and 2021, respectively. We have experienced negative cash flows from operations and have an accumulated deficit of $959.4 million as of December 31, 2023.
Rocket incurred net losses of $258.7 million, $245.6 million, and $221.9 million for the years ended December 31, 2024, 2023 and 2022, respectively. We have experienced negative cash flows from operations and have an accumulated deficit of $1.22 billion as of December 31, 2024. As of December 31, 2024, we had $372.3 million of cash, cash equivalents and investments.
The fair value of options on the date of grant is calculated using the Black-Scholes option pricing model based on key assumptions such as expected volatility and expected term. These assumptions are primarily based on the trading price of the Company’s stock, historical data, peer company data and judgment regarding future trends and factors.
The fair value of options on the date of grant is calculated using the Black-Scholes option pricing model based on key assumptions such as expected volatility and expected term.
Interest expense in 2021 was related to convertible notes due in 2021, which were converted into common stock in August 2021 and convertible notes due in 2022, which were converted into common stock in April 2021, and our financing lease obligation for the Cranbury, NJ facility. 72 Interest and Other Income Interest and other income related to interest earned from investments and cash equivalents, liability extinguishment and reduced fair value of warrant liability.
Interest Expense Interest expense in 2024 and 2023 was related to our financing lease obligation for our Cranbury, NJ facility. Interest and Other Income Interest and other income related to interest earned from investments and cash equivalents and reduced fair value of warrant liability.
The increase in G&A expenses was primarily driven by increases in commercial preparation expenses which consists of commercial strategy, medical affairs, market development and pricing analysis of $4.9 million, compensation and benefits of $4.4 million due to increased G&A headcount and acquisition related expenses of $3.2 million.
The increase in G&A expenses was primarily driven by increases in commercial preparation related expenses, which consisted of commercial strategy, medical affairs, market development and pricing analysis expenses, of $17.6 million, legal expenses of $4.8 million, non-cash stock compensation expense of $3.2 million, and compensation and benefit expenses of $2.1 million.
Additional work on a gene therapy program for the less common FA subtypes C and G is ongoing. 69 In the U.S., we also have two clinical stage and one pre-clinical stage in vivo adeno-associated virus (“AAV”) programs, which include programs for: • Danon disease (“DD”), a multi-organ lysosomal-associated disorder leading to early death due to heart failure.
We have two clinical stage and one pre-clinical stage in vivo adeno-associated viral (AAV) programs in the U.S., which include programs for: • Danon disease (DD), a multi-organ lysosomal-associated disorder leading to early death due to heart failure.
Through December 31, 2023, we sold 4.2 million shares under the at-the-market offering program for gross proceeds of $65.8 million, less commissions of $2.0 million for net proceeds of $63.8 million.
We may consider reactivating the at-the-market offering program in the future. We sold a total of 4.2 million shares under the at-the-market offering program for gross proceeds of $65.8 million, less commissions of $2.0 million, for net proceeds of $63.8 million. We did not sell any shares under the at-the-market offering program during the year ended December 31, 2024.
Information regarding our obligations relating to income taxes and lease arrangements are provided in “Note 12. Income Taxes” and “Note 13. Leases” to our consolidated financial statements contained in “Item 8.
Contractual Obligations In the normal course of business, we enter into contracts and commitments that obligate us to make payments in the future. Information regarding our obligations relating to income taxes and lease arrangements are provided in “Note 12. Income Taxes” and “Note 13. Leases” to our consolidated financial statements contained in “Item 8.
Even if our product development efforts are successful, it is uncertain when, if ever, we will generate significant revenue from product sales.
Even if our product development efforts are successful, it is uncertain when, if ever, we will generate significant revenue from product sales. We operate in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies.
The gross proceeds from the September 2023 Public Offering were approximately $201.3 million, net of $12.4 million of offering costs, underwriting discounts and commissions, legal and other expenses for net proceeds from the offering of $188.9 million.
The gross proceeds from the Offering and Private Placement were approximately $194.7 million, net of $12.2 million of offering costs, underwriting discounts and commissions, legal and other expenses for net proceeds from the Offering and Private Placement of $182.5 million.
We allocate salary and benefit costs directly related to specific programs. We do not allocate personnel-related discretionary bonus or stock-based compensation costs, costs associated with our general discovery platform improvements, depreciation or other indirect costs that are deployed across multiple projects under development and, as such, the costs are separately classified as other R&D expenses.
We do not allocate personnel-related discretionary bonus or stock-based compensation costs, costs associated with our general discovery platform improvements, depreciation or other indirect costs that are deployed across multiple projects under development and, as such, the costs are separately classified as other R&D expenses. 76 The following table presents R&D expenses, in thousands, tracked on a program-by-program basis as well as by type and nature of our expense for our product candidates for the years ended December 31, 2024 and 2023, and 2022.
Revenue To date, we have not generated any revenue from any sources, including from product sales, and we do not expect to generate any revenue from the sale of products in the near future.
We do not have any products approved for sale and have not generated any revenue from product sales.
During the year ended December 31, 2021, operating activities used $121.2 million of cash and cash equivalents, primarily resulting from our net loss of $169.1 million and net changes in our operating assets and liabilities of $3.4 million, partially offset by net non-cash charges of $51.3 million, including expenses in connection with the issuance of warrant of $12.8 million, stock-based compensation expense of $29.2 million, amortization of premium on investments of $2.9 million and depreciation and amortization expense of $5.4 million.
During the year ended December 31, 2023, operating activities used $194.9 million of cash and cash equivalents, primarily resulting from our net loss of $245.6 million offset by net non-cash charges of $37.2 million, including non-cash stock-based compensation expense of $39.4 million, depreciation and amortization expense of $7.1 million, impairment of acquired intangible asset and write down of property and equipment of $0.9 million, partially offset by accretion of discount on investments of $10.2 million.
We measure the compensation expense of employee and non-employee services received in exchange for an award of equity instruments based on the fair value of the award on the grant date. That cost is recognized on a straight-line basis over the period during which the employee and nonemployee is required to provide service in exchange for the award.
Stock-Based Compensation We issue stock-based awards to employees and non-employees, generally in the form of stock options, RSUs, and PSUs. We measure the compensation expense of employee and non-employee services received in exchange for an award of equity instruments based on the fair value of the award on the grant date.
Public Offering On September 15, 2023, we completed a public offering of approximately 9.5 million shares of our common stock at a public offering price of $16.00 per share and pre-funded warrants to purchase 3.1 million shares of common stock at a price of $15.99 per warrant (the “September 2023 Public Offering”).
Public Offering and Private Placement On December 12, 2024, the Company completed the Offering of approximately 15.2 million shares of its common stock at a public offering price of $12.50 per share and Private Placement of pre-funded warrants to purchase 0.4 million shares of common stock at a price of $12.49 per warrant.
Public Offering On September 15, 2023, we completed a public offering of approximately 9.5 million shares of our common stock at a public offering price of $16.00 per share and pre-funded warrants to purchase 3.1 million shares of common stock at a price of $15.99 per warrant (the “September 2023 Public Offering”).
Public Offerings and Private Placements On December 12, 2024, the Company completed the Offering of approximately 15.2 million shares of its common stock at a public offering price of $12.50 per share and Private Placement of pre-funded warrants to purchase 0.4 million shares of common stock at a price of $12.49 per warrant.
We operate in an environment of rapid change in technology and substantial competition from pharmaceutical and biotechnology companies. 74 Our consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities in the ordinary course of business.
Our consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities in the ordinary course of business. Rocket has incurred net losses and negative cash flows from its operations each year since inception.
We classify stock-based compensation expense in our statements of operations in the same manner in which the award recipient’s payroll costs and services are classified or in which the award recipient’s service payments are classified. The Company recognizes compensation expense for at least the portion of awards that are vested. Forfeitures are accounted for as they occur.
We classify stock-based compensation expense in our Consolidated Statements of Operations in the same manner in which the award recipient’s payroll costs and services are classified or in which the award recipient’s service payments are classified. Recent Accounting Pronouncements Accounting Pronouncements Not Adopted as of December 31, 2024 ASU 2023-09: Income Taxes Topic 740 - Improvements to Income Tax Disclosures.
As this accounting standard only impacts disclosures, it will not have a material impact on the Company's consolidated financial statements. 78 ASU 2023-07: Segment Reporting Topic 280 - Improvements to Reportable Segment Disclosures.
The Company is evaluating the effect that ASU 2024-03 will have on its financial statements and disclosures. 83 Accounting Pronouncements Adopted as of December 31, 2024 ASU 2023-07: Segment Reporting Topic 280 - Improvements to Reportable Segment Disclosures.
On April 30, 2019, CIRM awarded the Company up to $7.5 million under a CLIN2 grant award program to support the clinical development of our LV-based gene therapy for RP-L201 based on achievements of specific development milestones. The Company achieved two milestones in 2019 and received $1.1 million. In 2020, the Company achieved two more milestones and received $2.8 million.
On August 18, 2024, CIRM awarded the Company up to $5.8 million under a CLIN2 grant award to support the clinical development of its AAV-based gene therapy, RP-A501 for the treatment of DD. Proceeds from the grant would help fund clinical trial costs as well as manufactured drug product for Phase 1/2 patients.
The gross proceeds from the September 2023 Public Offering were approximately $201.3 million, net of $12.4 million of offering costs, underwriting discounts and commissions, legal and other expenses for net proceeds from the offering of $188.9 million. Contractual Obligations In the normal course of business, we enter into contracts and commitments that obligate us to make payments in the future.
The gross proceeds from the Offering and Private Placement were approximately $194.7 million, net of $12.2 million of offering costs, underwriting discounts and commissions, legal and other expenses for net proceeds from the Offering and Private Placement of $182.5 million.
The increase in R&D expenses was primarily driven by increases in manufacturing and development costs of $26.3 million, laboratory supplies of $6.6 million, compensation and benefits expense of $11.5 million due to increased R&D headcount, direct materials of $3.6 million, and consulting and professional fees of $2.7 million.
The decrease in R&D expenses was primarily driven by decreases in manufacturing development and direct material costs of $19.9 million.
The change was primarily driven by decreased interest expense of $1.1 million associated with convertible notes due in 2022, which were converted into common stock in April 2021 and convertible notes due in 2021, which were converted into common stock in August 2021, an increase in interest and other income, net, of $0.8 million due to increased interest rates and a decrease in amortization of premium on investment, net, of $2.9 million.
The increase in other income was primarily driven by an increase in interest and other income, net, of $3.0 million partially offset by a decrease in accretion of discount on investments, net, of $2.6 million.
This program received FDA clearance of an Investigational New Drug (“IND”) application and we have initiated a Phase 1 study. • BAG3 Dilated Cardiomyopathy (“DCM”), which is the most common form of cardiomyopathy and is characterized by progressive thinning of the walls of the heart resulting in enlarged heart chambers that are unable to pump blood.
The Company has received FDA clearance of an investigational new drug (IND) application for RP-A601, and has initiated a Phase 1 study for this program. For the BAG3 program, nonclinical and IND enabling studies are ongoing. Submission of the IND is anticipated in the first half of 2025.
In September 2023, the FDA accepted the Biologics License Application (“BLA”) and granted priority review for RP-L201 for the treatment of severe LAD-I. Treatments in the FA Phase 2 studies were completed in 2023 with regulatory filings in the United States (“U.S.”) and Europe (“EU”) for FA anticipated in 2024.
In September 2023, the U.S. Food and Drug Administration (FDA) accepted the Biologics License Application (BLA) and granted priority review for RP-L201 for the treatment of severe LAD-I. In June 2024, we announced that the FDA had issued a CRL in response to the BLA wherein the FDA requested limited additional CMC information to complete its review.
The shares to be offered and sold under the Sales Agreement, if any, will be offered and sold pursuant to our shelf registration statement on Form S-3. We filed a prospectus supplement with the SEC on February 28, 2022 in connection with the offer and sale of the shares pursuant to the Sales Agreement.
The shares offered and sold under the Sales Agreement were offered and sold pursuant to a shelf registration statement on Form S-3 that expired in September 2024 after three years in accordance with the Commission’s rules. As a result of the expiration of such registration statement, the at-the-market offering program in not currently available to us.
Liquidity and Capital Resources We have not generated any revenue and have incurred losses since inception.
The increase in interest and other income, net, of $1.4 million was due to increased interest rates of $1.6 million, partially offset by increased fair value of warrant liability of $0.4 million. 79 Liquidity and Capital Resources We have not generated any revenue and have incurred losses since inception.
Removed
Our program utilizes recombinant AAV9-based gene therapy designed to slow or halt progression of BAG3-DCM. We have global commercialization and development rights to all of these product candidates under royalty-bearing license agreements.
Added
Our program utilizes recombinant adeno-associated virus serotype 9 (AAV9)-based gene therapy designed to slow or halt progression of BAG3-DCM. 74 In September 2023, we announced our alignment with the FDA on our pivotal study design for RP-A501 in DD. Completion of enrollment in this study was announced in September 2024, and dosing and follow-up are ongoing.
Removed
We will pay Cowen a cash commission of 3.0% of gross proceeds from the sale of the shares pursuant to the Sales Agreement. We also agreed to provide Cowen with customary indemnification and contribution rights. We have reimbursed Cowen for certain expenses incurred in connection with the Sales Agreement.
Added
Submission of complete BLA to resolve Complete Response Letter anticipated in 2025. With respect to RP-L201, treatments in the FA Phase 2 studies were completed in 2023 and submission of a BLA on a rolling review basis was initiated in September 2024. In April 2024, the European Medicines Agency (EMA) accepted our Marketing Authorization Applications (MAA) for RP-L102.
Removed
On September 12, 2023, the Company and Cowen entered into an amendment pursuant to which the aggregate offering amount available under the at-the-market offering program was reduced to $180.0 million.
Added
Additional work on a gene therapy program for the less common FA subtypes C and G is ongoing. With respect to RP-L301, we have reached agreement with the FDA on the study design of the Phase 2 pivotal trial for RP-L301, our ex vivo LV-based program targeting PKD.
Removed
The following table presents R&D expenses, in thousands, tracked on a program-by-program basis as well as by type and nature of our expense for our product candidates for the years ended December 31, 2023 and 2022, and 2021.
Added
While the Phase 2 RP-L301 study is ready for patient enrollment, we are currently focusing our resources on other programs and have not initiated enrollment in the Phase 2 RP-L301 study. We have global commercialization and development rights to all of these product candidates under royalty-bearing license agreements.
Removed
Interest Expense Interest expense in 2023 and 2022 was related to our financing lease obligation for our Cranbury, NJ facility.
Added
We allocate salary and benefit costs directly related to specific programs.
Removed
The increase in interest and other income, net, of $1.4 million was due to increased interest rates of $1.6 million and a liability extinguishment of $0.6 million, partially offset by increased fair value of warrant liability of $0.4 million. 73 Comparison of the Years Ended December 31, 2022 and 2021 The following table summarizes our results of operations, in thousands, for each of the periods presented: For the Years Ended December 31, 2022 2021 Change Operating expenses: Research and development $ 165,570 $ 125,476 $ 40,094 General and administrative 58,773 41,772 17,001 Total operating expenses 224,343 167,248 57,095 Loss from operations (224,343 ) (167,248 ) (57,095 ) Research and development incentives 500 1,000 (500 ) Interest expense (1,862 ) (2,977 ) 1,115 Interest and other income, net 3,889 3,068 821 Accretion of discount and amortization of premium on investments, net (47 ) (2,912 ) 2,865 Total other income (expense), net 2,480 (1,821 ) 4,301 Net loss $ (221,863 ) $ (169,069 ) $ (52,794 ) Research and Development Expenses R&D expenses increased $40.1 million to $165.6 million for the year ended December 31, 2022, compared to the year ended December 31, 2021.
Added
Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 The following table summarizes our results of operations, in thousands, for each of the periods presented: For the Years Ended December 31, 2024 2023 Change Operating expenses: Research and development $ 171,244 $ 186,342 $ (15,098 ) General and administrative 101,961 73,317 28,644 Total operating expenses 273,205 259,659 13,546 Loss from operations (273,205 ) (259,659 ) (13,546 ) Interest expense (1,886 ) (1,875 ) (11 ) Interest and other income, net 8,267 5,288 2,979 Accretion of discount on investments, net 8,078 10,651 (2,573 ) Total other income, net 14,459 14,064 395 Net loss $ (258,746 ) $ (245,595 ) $ (13,151 ) Research and Development Expenses R&D expenses decreased $15.1 million to $171.2 million for the year ended December 31, 2024, compared to the year ended December 31, 2023.
Removed
Increases noted were offset by a decrease in license fees of $12.9 million attributable to the expense in connection with warrants to purchase shares of common stock recorded for the year ended December 31, 2021.
Added
The decreases were partially offset by increases in the costs for professional fees and consultants of $4.0 million, non-cash stock compensation expense of $1.3 million, and depreciation expense of $2.2 million. 78 General and Administrative Expenses G&A expenses increased $28.6 million to $102.0 million for the year ended December 31, 2024, compared to the year ended December 31, 2023.
Removed
General and Administrative Expenses G&A expenses increased $17.0 million to $58.8 million for the year ended December 31, 2022, compared to the year ended December 31, 2021.
Added
The increase in interest and other income, net, of $3.0 million was primarily due to decreases in warrant liability of $1.9 million and increased interest income of $0.7 million.
Removed
As of December 31, 2023, we had $407.5 million of cash, cash equivalents and investments. Included in the $407.5 million cash balance are securities that have yet to be paid of $13.1 million related to investments in securities that settled in 2024. The net cash balance, when adjusting for this payable would have been $394.4 million.
Added
As of December 31, 2024, the Company has received RP-A501 grants of $2.3 million from CIRM, which were recorded as a reduction of R&D expenses for the RP-A501 program for the year ended December 31, 2024.
Removed
The Company achieved an additional milestone in 2021 and received $1.0 million. In 2022, the Company achieved one more milestone and received $0.9 million. In 2023, the Company achieved a final milestone resulting in a payment of $0.05 million. No additional payments are available under the grant award program as of December 31, 2023.
Added
The cost of stock options and RSUs is recognized over the requisite service period of the awards on a straight-line basis with forfeitures recognized as they occur.
Removed
At-the-Market Offering Program On February 28, 2022, we entered into a Sales Agreement with Cowen with respect to an at-the-market offering program pursuant to which we may offer and sell, from time to time at our sole discretion, shares through Cowen as our sales agent.
Added
The vesting condition for PSUs is performance based and the cost of a PSU is recognized when it is likely that the performance goal associated with the PSU will be achieved and the award will vest.
Removed
The shares to be offered and sold under the Sales Agreement, if any, will be offered and sold pursuant to our shelf registration statement on Form S-3. We filed a prospectus supplement with the SEC on February 28, 2022 in connection with the offer and sale of the shares pursuant to the Sales Agreement.
Added
ASU 2024-03: Disaggregation of Income Statement Expenses (DISE). This update requires disaggregated disclosure of income statement expenses. This update is effective for the Company for fiscal years beginning after December 15, 2027. Early adoption is permitted.
Removed
We will pay Cowen a cash commission of 3.0% of gross proceeds from the sale of the shares pursuant to the Sales Agreement. We also agreed to provide Cowen with customary indemnification and contribution rights. We have reimbursed Cowen for certain expenses incurred in connection with the Sales Agreement.
Added
The adoption of ASU 2023-07 resulted in a new footnote disclosure for Segment Reporting.
Removed
Through December 31, 2023, we sold 4.2 million shares under the at-the-market offering program for gross proceeds of $65.8 million, less commissions of $2.0 million for net proceeds of $63.8 million.
Removed
During the year ended December 31, 2023, we sold 0.9 million shares under the at-the-market offering program for gross proceeds of $17.8 million, less commissions of approximately $0.6 million for net proceeds of $17.2 million.
Removed
On September 12, 2023, the Company and Cowen entered into an amendment pursuant to which the aggregate offering amount available under the at-the-market offering program was reduced to $180.0 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitat ive Disclosures about Market Risks We are exposed to market risk related to changes in interest rates. As of December 31, 2023 and 2022, we had cash, cash equivalents and investments of $407.5 million and $399.7 million, respectively. The Company’s investments are primarily in U.S. Treasury Securities, Commercial Paper and Corporate and Agency Bonds.
Biggest changeItem 7A. Quantitative and Qualitat ive Disclosures about Market Risks We are exposed to market risk related to changes in interest rates. As of December 31, 2024 and 2023, we had cash, cash equivalents and investments of $372.3 million and $407.5 million, respectively. The Company’s investments are primarily in U.S. Treasury Securities and Corporate Bonds.
If market interest rates were to increase immediately and uniformly by 100 basis points, or one percentage point, from levels at December 31, 2023, the net effect on the net fair value of our interest-sensitive marketable securities would have resulted in a hypothetical decline of $1.7 million. Item 8.
If market interest rates were to increase immediately and uniformly by 100 basis points, or one percentage point, from levels at December 31, 2024, the net effect on the net fair value of our interest-sensitive marketable securities would have resulted in a hypothetical decline of $0.8 million. Item 8.

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