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What changed in Viking Therapeutics, Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Viking Therapeutics, Inc.'s 2022 and 2023 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 2023 report.

+290 added−289 removedSource: 10-K (2024-02-07) vs 10-K (2023-02-10)

Top changes in Viking Therapeutics, Inc.'s 2023 10-K

290 paragraphs added · 289 removed · 222 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

57 edited+16 added−19 removed237 unchanged
Biggest changeVK2809 8 While no therapies are currently approved for the treatment of non-alcoholic steatohepatitis, we are aware of numerous development-stage programs targeting this disease, including obeticholic acid from Intercept Pharmaceuticals, Inc., resmetirom (MGL-3196) from Madrigal Pharmaceuticals, Inc., arachidyl amido cholanoic acid from Galmed Pharmaceuticals Ltd., belapectin (GR-MD-02) from Galectin Therapeutics Inc., lanifibranor from Inventiva S.A., semaglutide from Novo Nordisk A/S, firsocostat (GS-0976) and cilofexor (GS-9674) from Gilead Sciences, Inc., tirzepatide from Eli Lilly and Company, ervogastat (PF-06865571) and clesacostat (PF-05221304) from Pfizer Inc., MK-6024 ( efinopegdutide ) from Merck & Co., Inc., efruxifermin (AKR-001) from Akero Therapeutics, Inc., pegozafermin (BIO89-100) from 89bio, Inc., denifanstat (TVB-2640) from Sagimet Biosciences Inc., cotadutide from AstraZeneca PLC, and GSK4532990 (ARO-HSD) from GlaxoSmithKline plc.
Biggest changeVK2809 While no therapies are currently approved for the treatment of non-alcoholic steatohepatitis, we are aware of numerous development-stage programs targeting this disease, including resmetirom from Madrigal Pharmaceuticals, Inc., arachidyl amido cholanoic acid from Galmed Pharmaceuticals Ltd., belapectin from Galectin Therapeutics Inc., lanifibranor from Inventiva S.A., semaglutide from Novo Nordisk A/S, firsocostat (GS-0976) and cilofexor (GS-9674) from Gilead Sciences, Inc., tirzepatide from Eli Lilly and Company, ervogastat (PF-06865571) and clesacostat (PF-05221304) from Pfizer Inc., efruxifermin (AKR-001) from Akero Therapeutics, Inc., pegozafermin (BIO89-100) from 89bio, Inc., denifanstat (TVB-2640) from Sagimet Biosciences Inc., efocipegtrutide (HM15211) from Hanmi Pharmaceutical Co., Ltd., survodutide (BI 456906) from Boehringer Ingelheim International GmbH, ION224 from Ionis Pharmaceuticals, Inc., rencofilstat (CRV431) from Hepion Pharmaceuticals, Inc., HTD1801 from HighTide Therapeutics Inc., GSK4532990 (ARO-HSD) from GlaxoSmithKline plc., ALN-HSD from Alnylam Pharmaceuticals, Inc./ Regeneron Pharmaceuticals Inc., efinopegdutide (MK-6024) from Merck & Co., Inc., and pemvidutide (ALT-801) from Altimmune, Inc.
Many of the observed lipid reductions achieved statistical significance, though the study was not powered to demonstrate statistical significance on laboratory assessments. 5 % Change in Lipid Markers Following 14 Days of Treatment of VK0214 Placebo 1 5 mg 10 mg 25 mg 50 mg 75 mg 100 mg (n=11) (n=6) (n=6) (n=6) (n=6) (n=6) (n=6) LDL-C 3.8% -0.7% -12.5%* -21.4%** -19.5%** -19.1%*** -18.9%** Triglycerides 4.9% -6.7% -19.5%* -1.7% -36.8%** -45.0%*** -39.1%** ApoB 4.4% -5.7% -12.5%** -23.3%*** -24.0%*** -28.3%*** -28.2%*** (1) Excludes one placebo subject due to an anomalous triglyceride value (>7x higher than SD). *p .
Many of the observed lipid reductions achieved statistical significance, though the study was not powered to demonstrate statistical significance on laboratory assessments. % Change in Lipid Markers Following 14 Days of Treatment of VK0214 Placebo 1 5 mg 10 mg 25 mg 50 mg 75 mg 100 mg (n=11) (n=6) (n=6) (n=6) (n=6) (n=6) (n=6) LDL-C 3.8% -0.7% -12.5%* -21.4%** -19.5%** -19.1%*** -18.9%** Triglycerides 4.9% -6.7% -19.5%* -1.7% -36.8%** -45.0%*** -39.1%** ApoB 4.4% -5.7% -12.5%** -23.3%*** -24.0%*** -28.3%*** -28.2%*** (1) Excludes one placebo subject due to an anomalous triglyceride value (>7x higher than SD). *p .
Even if we obtain regulatory approval of any of our drug candidates, our competitors may succeed in obtaining regulatory approvals for their products earlier than we do.
Even if we obtain regulatory approval for any of our drug candidates, our competitors may succeed in obtaining regulatory approvals for their products earlier than we do.
The FDA reviews all NDAs submitted to ensure that they are sufficiently complete for substantive review before it accepts them for filing. It may request additional information rather than accept an NDA for 13 filing. In this event, the NDA must be resubmitted with the additional information.
The FDA reviews all NDAs submitted to ensure that they are sufficiently complete for substantive review before it accepts them for filing. It may request additional information rather than accept an NDA for filing. In this 13 event, the NDA must be resubmitted with the additional information.
As further partial consideration for the grant of the rights and licenses to us by Ligand under the Master License Agreement, we have agreed to pay to Ligand certain one-time, non-refundable milestone payments in connection with Licensed Products containing (1) VK2809, VK0214 or any other TRß Compound, in an aggregate amount of up to $75.0 million per indication (for up to a total of three indications) upon the achievement of certain development and regulatory milestones and up to $150.0 million upon the achievement of certain sales milestones; (2) VK5211 or any other SARM Compound, in an aggregate amount of up to $85.0 million per indication (for up to a total of two indications) upon the achievement of certain development and regulatory milestones and up to $100.0 million upon the achievement of certain sales milestones; (3) VK0612 or any other FBPase Compound, in an aggregate amount of up to $60.0 million per indication (for up to a total of four indications) upon the achievement of certain development and regulatory milestones and up to $150.0 million upon the achievement of certain sales milestones; (4) any EPOR Compound, in an aggregate amount of up to $48.0 million per indication (for up to a total of three indications) upon the achievement of certain development and regulatory milestones and up to $50.0 million upon the achievement of certain sales milestones; and (5) any DGAT-1 Compound, in an aggregate amount of up to $78.0 million per indication (for up to a total of two indications) upon the achievement of certain development and regulatory milestones and up to $150.0 million upon the achievement of certain sales milestones.
As further partial consideration for the grant of the rights and licenses to us by Ligand under the Master License Agreement, we have agreed to pay to Ligand certain one-time, non-refundable milestone payments in connection with Licensed Products containing (1) VK2809, VK0214 or any other TRß Compound, in an aggregate amount of up to $75.0 million per indication (for up to a total of three indications) upon the achievement of certain development and regulatory milestones and up to $150.0 million upon the achievement of 10 certain sales milestones; (2) VK5211 or any other SARM Compound, in an aggregate amount of up to $85.0 million per indication (for up to a total of two indications) upon the achievement of certain development and regulatory milestones and up to $100.0 million upon the achievement of certain sales milestones; (3) VK0612 or any other FBPase Compound, in an aggregate amount of up to $60.0 million per indication (for up to a total of four indications) upon the achievement of certain development and regulatory milestones and up to $150.0 million upon the achievement of certain sales milestones; (4) any EPOR Compound, in an aggregate amount of up to $48.0 million per indication (for up to a total of three indications) upon the achievement of certain development and regulatory milestones and up to $50.0 million upon the achievement of certain sales milestones; and (5) any DGAT-1 Compound, in an aggregate amount of up to $78.0 million per indication (for up to a total of two indications) upon the achievement of certain development and regulatory milestones and up to $150.0 million upon the achievement of certain sales milestones.
In particular, based upon the Phase 2 trial results, we believe the unique liver-targeting properties of VK2809 impart a robust lipid lowering effect within hepatic tissue, with potential therapeutic applications in fatty liver diseases such as NASH. 4 • Combinability: VK2809’s novel mechanism of action is expected to allow combinability with many existing therapies, leading to enhanced efficacy and potentially delaying transition to subsequent therapies. • Once-daily oral dosing: Clinical data suggest that VK2809 has the potential to lower plasma lipid levels in NASH or hypercholesterolemia patients as a once-daily oral therapy.
In particular, based upon the Phase 2 trial results, we believe the unique liver-targeting properties of VK2809 impart a robust lipid lowering effect within hepatic tissue, with potential therapeutic applications in fatty liver diseases such as NASH. • Combinability: VK2809’s novel mechanism of action is expected to allow combinability with many existing therapies, leading to enhanced efficacy and potentially delaying transition to subsequent therapies. • Once-daily oral dosing: Clinical data suggest that VK2809 has the potential to lower plasma lipid levels in NASH or hypercholesterolemia patients as a once-daily oral therapy.
In addition, no cardiovascular abnormalities were reported, in-line with the expected high tissue and receptor selectivity for VK2809. • Encouraging tolerability: VK2809 has been well-tolerated at and above doses that we are currently administrating and plan to administer in future clinical trials. • Novel mechanism of action: Based on its selective thyroid receptor targeting mechanism of action, we believe VK2809 has the potential to lower plasma and liver lipid levels in a manner complementary to existing agents such as statins.
In addition, no cardiovascular abnormalities were reported, in-line with the expected high tissue and receptor selectivity for VK2809. • Encouraging tolerability: VK2809 has been well-tolerated at and above doses that we are currently administrating and plan to administer in future clinical trials. 4 • Novel mechanism of action: Based on its selective thyroid receptor targeting mechanism of action, we believe VK2809 has the potential to lower plasma and liver lipid levels in a manner complementary to existing agents such as statins.
During Phase 1 clinical trials, sufficient information about the investigational drug’s pharmacokinetics and pharmacologic effects may be obtained to permit the design of well-controlled and scientifically valid Phase 2 clinical trials. • Phase 2 – clinical trials are conducted to evaluate the effectiveness of the drug for a particular indication or in a limited number of patients in the target population to identify possible adverse effects and safety risks, to determine the efficacy 12 of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage.
During Phase 1 clinical trials, sufficient information about the investigational drug’s pharmacokinetics and pharmacologic effects may be obtained to permit the design of well-controlled and scientifically valid Phase 2 clinical trials. • Phase 2 – clinical trials are conducted to evaluate the effectiveness of the drug for a particular indication or in a limited number of patients in the target population to identify possible adverse effects and safety risks, to determine the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage.
These firms and, where applicable, their suppliers are subject to inspections by the 16 FDA at any time, and the discovery of violative conditions, including failure to conform to cGMP, could result in enforcement actions that interrupt the operation of any such product or may result in restrictions on a product, manufacturer, or holder of an approved NDA, including, among other things, recall or withdrawal of the product from the market.
These firms and, where applicable, their suppliers are subject to inspections by the FDA at any time, and the discovery of violative conditions, including failure to conform to cGMP, could result in enforcement actions that interrupt the operation of any such product or may result in restrictions on a product, manufacturer, or holder of an approved NDA, including, among other things, recall or withdrawal of the product from the market.
We have the right to terminate the Master License Agreement under certain circumstances, including, but not limited to: (i) if Ligand does not pay an undisputed amount owing under the Master License Agreement when due and fails to cure such default within a specified period of time, or (ii) if Ligand defaults on certain of its material and substantial 10 obligations and fails to cure the default within a specified period of time.
We have the right to terminate the Master License Agreement under certain circumstances, including, but not limited to: (i) if Ligand does not pay an undisputed amount owing under the Master License Agreement when due and fails to cure such default within a specified period of time, or (ii) if Ligand defaults on certain of its material and substantial obligations and fails to cure the default within a specified period of time.
Any drug candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future. Many of our competitors have significantly greater financial resources and expertise in research and development, manufacturing, preclinical studies, clinical trials, regulatory approvals and marketing approved products than we do.
Any drug candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future. 8 Many of our competitors have significantly greater financial resources and expertise in research and development, manufacturing, preclinical studies, clinical trials, regulatory approvals and marketing approved products than we do.
Placebo-adjusted increases in lean body mass were 4.8% at 0.5 mg (p • The proportion of patients experiencing at least a 5% increase in total lean body mass, less head, were 19% with placebo, 61% at 0.5 mg, 65% at 1.0 mg, and 75% at 2.0 mg (p • All doses of VK5211 produced statistically significant increases in appendicular lean body mass, a secondary efficacy endpoint.
Placebo-adjusted increases in lean body mass were 4.8% at 0.5 mg (p • The proportion of patients experiencing at least a 5% increase in total lean body mass, less head, were 19% with placebo, 61% at 0.5 mg, 65% at 1.0 mg, and 75% at 2.0 mg (p 7 • All doses of VK5211 produced statistically significant increases in appendicular lean body mass, a secondary efficacy endpoint.
For example, on December 22, 2017, the Tax Cuts and Jobs Act of 2017 was signed into law, which, among other things, eliminated the individual mandate requiring most Americans (other than those who qualify for a hardship exemption) to carry a minimum level of health coverage, effective January 1, 2019.
For example, on December 22, 2017, the Tax Cuts and Jobs Act of 2017 was signed into law, which, among other things, eliminated 19 the individual mandate requiring most Americans (other than those who qualify for a hardship exemption) to carry a minimum level of health coverage, effective January 1, 2019.
Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. Our competitors may succeed in developing technologies and therapies that are more effective, better tolerated or less costly than any that we are developing, or that would render our drug candidates obsolete and noncompetitive.
Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. Our competitors may succeed in developing technologies and therapies that are more effective, better tolerated or less costly than any which we are developing, or that would render our drug candidates obsolete and noncompetitive.
Various preclinical models have demonstrated that increased expression of ABCD2 can lead to 1 normalization of VLCFA metabolism. Preliminary data suggest that VK0214 stimulates ABCD2 expression in an in vitro model and reduces VLCFA levels in an in vivo model of X-ALD. In June 2021, we initiated a Phase 1b clinical trial of VK0214 in patients with X-ALD.
Various preclinical models have demonstrated that increased expression of ABCD2 can lead to normalization of VLCFA metabolism. Preliminary data suggest that VK0214 stimulates ABCD2 expression in an in vitro model and reduces VLCFA levels in an in vivo model of X-ALD. In June 2021, we initiated a Phase 1b clinical trial of VK0214 in patients with X-ALD.
Over time with either method, as the transplanted cells grow and repopulate, a partial restoration of ABCD1 function can be achieved, leading many patients to resolution of progression in the cerebral form of the disease. 6 However, recent data suggest that, even among successfully transplanted patients, AMN can develop.
Over time with either method, as the transplanted cells grow and repopulate, a partial restoration of ABCD1 function can be achieved, leading many patients to resolution of progression in the cerebral form of the disease. However, recent data suggest that, even among successfully transplanted patients, AMN can develop.
CALD is characterized by a progressive inflammatory destruction of myelin, leading to severe loss of neurological function and eventual death. Approximately 35% to 40% of male X-ALD patients present with cerebral involvement at a younger age, between the ages of 5 and 12 years.
CALD is characterized by a progressive inflammatory destruction of myelin, leading to severe loss of neurological function and eventual death. Approximately 35% to 40% of male X-ALD patients present with cerebral involvement at a younger age, between 6 the ages of 5 and 12 years.
President Biden and his administration have announced plans to amend the PPACA to, 19 among other things, expand the scope of the law. We cannot predict the ultimate form or timing of any repeal, replacement, amendment, expansion or other modification of the PPACA or the effect such a repeal, replacement, amendment, expansion or other modification would have on our business.
President Biden and his administration have announced plans to amend the PPACA to, among other things, expand the scope of the law. We cannot predict the ultimate form or timing of any repeal, replacement, amendment, expansion or other modification of the PPACA or the effect such a repeal, replacement, amendment, expansion or other modification would have on our business.
TRß is the major receptor isoform expressed in the liver and thyroid hormone receptor alpha, or TR a , is the major isoform expressed in the heart. The unique properties of our TRß agonists are designed to reduce or eliminate the deleterious effects of extra-hepatic thyroid receptor activation.
TRß is the major receptor isoform expressed in the liver and thyroid hormone receptor alpha, or TR  is the major isoform expressed in the heart. The unique properties of our TRß agonists are designed to reduce or eliminate the deleterious effects of extra-hepatic thyroid receptor activation.
In particular, high tissue and TRß selectivity may lead to reduced activity at the TR a receptor, which can be associated with increased respiration and cardiac tissue hypertrophy.
In particular, high tissue and TRß selectivity may lead to reduced activity at the TR receptor, which can be associated with increased respiration and cardiac tissue hypertrophy.
NDA holders using contract manufacturers, laboratories or packagers are responsible for the selection and monitoring of qualified firms and, in certain circumstances, qualified suppliers to these firms.
NDA holders using contract manufacturers, laboratories or packagers are responsible for the selection and monitoring of qualified firms and, in certain circumstances, qualified 16 suppliers to these firms.
Multiple Phase 2 clinical trials may be conducted by the sponsor to obtain information prior to beginning larger and more expensive Phase 3 clinical trials.
Multiple Phase 2 clinical trials may be conducted by the sponsor to obtain information prior to beginning larger and more expensive Phase 12 3 clinical trials.
Item 1. Business. Overview We are a clinical-stage biopharmaceutical company focused on the development of novel, first-in-class or best-in-class therapies for metabolic and endocrine disorders. Our lead clinical program’s drug candidate, VK2809, is an orally available, tissue and receptor-subtype selective agonist of the thyroid hormone receptor beta, or TRß.
Item 1. Busi ness. Overview We are a clinical-stage biopharmaceutical company focused on the development of novel, first-in-class or best-in-class therapies for metabolic and endocrine disorders. Our lead clinical program’s drug candidate, VK2809, is an orally available, tissue and receptor-subtype selective agonist of the thyroid hormone receptor beta, or TRß.
We have developed additional programs ourselves, including VK2735 and others. 9 Agreements with Ligand Master License Agreement On May 21, 2014, we entered into a Master License Agreement, as amended on each of September 6, 2014, April 8, 2015 and March 21, 2016, or the Master License Agreement, with Ligand pursuant to which, among other things, Ligand granted to us and our affiliates an exclusive, perpetual, irrevocable, worldwide, royalty-bearing right and license under (1) patents related to (a) our VK2809 and VK0214 programs and any other compounds comprised by specified TRß patents and any derivatives of such compounds, or TRß Compounds, (b) our VK5211 program and any other compounds comprised by specified SARM patents and derivatives of such compounds, or SARM Compounds, (c) our VK0612 program and any other compounds comprised by specified FBPase patents and derivatives of such compounds, or FBPase Compounds, (d) our DGAT-1 program and any other compounds comprised by specified DGAT-1 patents and derivatives of such compounds, or DGAT-1 Compounds, and (e) our EPOR program and any other compounds comprised by specified EPOR patents and derivatives of such compounds, or EPOR Compounds, and; (2) related know-how controlled by Ligand; and (3) physical quantities of TRß Compounds, SARM Compounds, FBPase Compounds, DGAT-1 Compounds and EPOR Compounds or, collectively, the Licensed Technology, to research, develop, manufacture, have manufactured, use and commercialize the Licensed Technology in and for all therapeutic and diagnostic uses in humans or animals.
Agreements with Ligand Master License Agreement On May 21, 2014, we entered into a Master License Agreement, as amended on each of September 6, 2014, April 8, 2015 and March 21, 2016, or the Master License Agreement, with Ligand pursuant to which, among other things, Ligand granted to us and our affiliates an exclusive, perpetual, irrevocable, worldwide, royalty-bearing right and license under (1) patents related to (a) our VK2809 and VK0214 programs and any other compounds comprised by specified TRß patents and any derivatives of such compounds, or TRß Compounds, (b) our VK5211 program and any other compounds comprised by specified SARM patents and derivatives of such compounds, or SARM Compounds, (c) our VK0612 program and any other compounds comprised by specified FBPase patents and derivatives of such compounds, or FBPase Compounds, (d) our DGAT-1 program and any other compounds comprised by specified DGAT-1 patents and derivatives of such compounds, or DGAT-1 Compounds, and (e) our EPOR program and any other compounds comprised by specified EPOR patents and derivatives of such compounds, or EPOR Compounds, and; (2) related know-how controlled by Ligand; and (3) physical quantities of TRß Compounds, SARM Compounds, FBPase Compounds, DGAT-1 Compounds and EPOR Compounds or, collectively, the Licensed Technology, to research, develop, manufacture, have manufactured, use and commercialize the Licensed Technology in and for all therapeutic and diagnostic uses in humans or animals.
Employees & Human Capital As of December 31, 2022, we had twenty-one full-time employees, seven of whom hold a Ph.D. or M.D. degree. All employees are engaged in research and development, business development and finance. None of our employees are subject to a collective bargaining agreement.
Employees & Human Capital As of December 31, 2023, we had twenty-seven full-time employees, seven of whom hold a Ph.D. or M.D. degree. All employees are engaged in research and development, business development and finance. None of our employees are subject to a collective bargaining agreement.
Zydus Cadila ). VK5211 In the U.S., there are currently no marketed therapies for the maintenance or improvement of lean body mass, bone mineral density or physical function in patients recovering from non-elective hip fracture surgery.
VK5211 9 In the U.S., there are currently no marketed therapies for the maintenance or improvement of lean body mass, bone mineral density or physical function in patients recovering from non-elective hip fracture surgery.
Further evaluation of exploratory functional endpoints is underway. • There were no significant differences in the rates of adverse events reported among patients receiving VK5211 compared with placebo. There were no dose-related differences in reported adverse events among various VK5211 treatment groups.
Further evaluation of exploratory functional endpoints is underway. • There were no significant differences in the rates of adverse events reported among patients receiving VK5211 compared with placebo. There were no dose-related differences in reported adverse events among various VK5211 treatment groups. No drug-related SAEs were observed in patients receiving VK5211.
The primary objectives of the study include evaluation of the safety and tolerability of single and multiple doses of VK2735 delivered subcutaneously and the identification of VK2735 doses suitable for further clinical development. Study investigators will also evaluate the pharmacokinetics of single and multiple doses.
The primary objectives of the study included evaluation of the safety and tolerability of single and multiple doses of VK2735 delivered subcutaneously and the identification of VK2735 doses suitable for further clinical development. Study investigators also evaluated the pharmacokinetics of single and multiple doses of VK2735.
In addition, the trial’s secondary endpoint was achieved, with VK2809-treated patients experiencing statistically significant reductions in liver fat content compared with placebo. VK2809 demonstrated encouraging safety and tolerability in this study, with no SAEs reported.
The study successfully achieved its primary endpoint, with patients receiving VK2809 demonstrating statistically significant reductions in LDL-C compared with placebo. In addition, the trial’s secondary endpoint was achieved, with VK2809-treated patients experiencing statistically significant reductions in liver fat content compared with placebo. VK2809 demonstrated encouraging safety and tolerability in this study, with no SAEs reported.
In January 2022, we announced the initiation of a Phase 1 single ascending dose, or SAD, and multiple ascending dose, or MAD, clinical trial of VK2735, a novel dual agonist of the glucagon-like peptide 1, or GLP-1, and glucose-dependent insulinotropic polypeptide, or GIP, receptors. VK2735 is in development for the potential treatment of various metabolic disorders.
In January 2022, we announced the initiation of a Phase 1 single ascending dose, or SAD, and multiple ascending dose, or MAD, clinical trial of VK2735, a novel dual agonist of the glucagon-like peptide 1, or GLP-1, and glucose-dependent insulinotropic polypeptide, or GIP, receptors.
We believe that we have sufficient supplies of drug substance to allow for completion of our planned clinical studies. Bulk active pharmaceutical ingredient, or API, and certain dosage forms are currently in storage in compliance with good manufacturing practices, or cGMP, requirements. We believe that a majority of the existing API will be suitable for formulation into clinical trial material.
Bulk active pharmaceutical ingredient, or API, and certain dosage forms are currently in storage in compliance with good manufacturing practices, or cGMP, requirements. We believe that a majority of the existing API will be suitable for formulation into clinical trial material.
Our History We were incorporated under the laws of the State of Delaware on September 24, 2012. Since our incorporation, we have devoted substantially all of our efforts to raising capital, building infrastructure and obtaining the worldwide rights to certain technology, including VK2809, VK0214 and VK5211, and conducting certain clinical trials and preclinical studies related to these programs.
Our History We were incorporated under the laws of the State of Delaware on September 24, 2012. Since our incorporation, we have devoted most of our efforts towards conducting certain clinical trials and preclinical studies related to our VK2809, VK2735, VK0214 and VK5211 programs and towards raising capital and building infrastructure.
Information regarding the issued patents and pending patent applications, as of December 31, 2022, is as follows: 20 Subject Matter/Compounds # Pending Applications # Issued Patents Geographical Scope Nominal Patent Term TRß agonists 69 17 U.S., Australia, Canada, China, Japan, Korea, Hong Kong, Mexico, Brazil, Russia, New Zealand, South Africa, Europe and PCT 2025-2041 VK5211 (SARM) 14 21 U.S., Australia, Europe, Chile, Argentina, Brazil, Canada, China, India, Japan, Korea, Mexico, New Zealand, South Africa, Taiwan and Venezuela 2025-2040 Other SARM 1 16 U.S., Japan, Korea, Argentina and Israel 2023-2026 VK0612 (FBPase inhibitor) 1 0 India 2036 DGAT-1 Inhibitors 0 8 U.S., Hong Kong and Europe 2030 EPOR Inhibitors 0 11 U.S., Australia, Canada, China, Europe, India, Japan, and Korea 2030 Corporate Information We were incorporated under the laws of the State of Delaware on September 24, 2012.
Information regarding the issued patents and pending patent applications, as of December 31, 2023, is as follows: 20 Subject Matter/Compounds # Pending Applications # Issued Patents Geographical Scope Nominal Patent Term TRß agonists 59 30 U.S., Australia, Canada, China, Japan, Korea, Hong Kong, Mexico, Brazil, Russia, New Zealand, South Africa, Europe and PCT 2025-2043 VK5211 (SARM) 13 21 U.S., Australia, Europe, Chile, Brazil, Canada, China, India, Japan, Korea, Mexico, New Zealand, South Africa, Taiwan and Venezuela 2025-2040 Other SARM 1 4 U.S., Japan, Korea, Argentina and Israel 2026 DGAT-1 Inhibitors 0 5 U.S. and Hong Kong 2030 EPOR Inhibitors 0 11 U.S., Australia, Canada, China, Europe, India, Japan, and Korea 2030 GLP-1 agonists 33 1 U.S., Argentina, Australia, Brazil, Canada, China, Europe, Indonesia, Israel, India, Japan, Korea, Mexico, New Zealand, Philippines, Russia, Saudi Arabia, South Africa, Taiwan and PCT 2042-2043 Corporate Information We were incorporated under the laws of the State of Delaware on September 24, 2012.
Drugs are also subject to other federal, state and local statutes and regulations. Failure to comply with the applicable U.S. regulatory requirements at any time during the drug development process, approval process or after approval may subject an applicant to administrative or judicial sanctions and non-approval of drug candidates.
Failure to comply with the applicable U.S. 11 regulatory requirements at any time during the drug development process, approval process or after approval may subject an applicant to administrative or judicial sanctions and non-approval of drug candidates.
The Phase 1 trial is a randomized, double-blind, placebo-controlled, SAD and MAD study in healthy adults. The primary objectives of the study include evaluation of the safety and tolerability of single and multiple doses of VK2735 delivered subcutaneously and the identification of VK2735 doses suitable for further clinical development.
The study was a randomized, double-blind, placebo-controlled, SAD and MAD study in healthy adults. The primary objectives of the study included evaluation of the safety and tolerability of single and multiple doses of VK2735 delivered subcutaneously and the identification of VK2735 doses suitable for further clinical development. Study investigators also evaluated the pharmacokinetics of single and multiple doses of VK2735.
In addition, we are aware of active programs at Aligos Therapeutics, Inc., Alnylam Pharmaceuticals, Inc., Altimmune , Inc., Arrowhead Pharmaceuticals, Inc., Ascletis Biopharmaceutical, Boehringer Ingelheim International GmbH, Boston Pharmaceuticals Inc., Bristol Myers Squibb, Can- Fite BioPharma Ltd., ChemomAb Ltd., CohBar , Inc., Corcept Therapeutics Inc., CytoDyn Inc., D&D Pharmatech , Inc., Durect Corporation, Enyo Pharma SA, Inc., Future Medicine Co., Ltd., Galecto , Inc., Gelesis Holdings Inc., Hanmi Pharmaceutical Co., Ltd., Hepagene Therapeutics, Inc., Hepion Pharmaceuticals, Inc., HighTide Therapeutics Inc., Ionis Pharmaceuticals, Inc., Johnson & Johnson, Kowa Company, Ltd., MediciNova Inc., NGM Biopharmaceuticals, Inc., NorthSea Therapeutics BV, Novartis Pharmaceuticals Corporation, Poxel SA, Regeneron Pharmaceuticals Inc., Rivus Pharmaceuticals Inc., Seal Rock Therapeutics, Inc., Terns Pharmaceuticals, Inc., Theratechnologies Inc., Yuhan Corporation, and Cadila Healthcare Limited (a.k.a.
In addition, we are aware of active programs at Aligos Therapeutics, Inc., Arrowhead Pharmaceuticals, Inc., Ascletis Biopharmaceutical, AstraZeneca PLC, Boston Pharmaceuticals Inc., Can-Fite BioPharma Ltd., ChemomAb Ltd., CohBar, Inc., Corcept Therapeutics Inc., CytoDyn Inc., D&D Pharmatech, Inc., Durect Corporation, Enyo Pharma SA, Inc., Future Medicine Co., Ltd., Galecto, Inc., Gelesis Holdings Inc., Hepagene Therapeutics, Inc., Kowa Company, Ltd., MediciNova Inc., NGM Biopharmaceuticals, Inc., NorthSea Therapeutics BV, Pliant Therapeutics, Inc., Poxel SA, Seal Rock Therapeutics, Inc., Theratechnologies Inc., Yuhan Corporation, and Cadila Healthcare Limited (a.k.a.
There are several experimental therapies that are in various stages of clinical development for X-ALD by companies, including Minoryx Therapeutics S.L., Poxel SA, and SwanBio Therapeutics, Inc., which may be competitive with VK0214, if approved. Manufacturing and Supply We do not have any manufacturing facilities and do not intend to develop any manufacturing capabilities.
There are several experimental therapies that are in various stages of clinical development for X-ALD by companies, including Minoryx Therapeutics S.L., Neuraxpharm Group, Poxel SA, and SwanBio Therapeutics, Inc., which may be competitive with VK0214, if approved.
The primary objective of the study is to evaluate the safety and tolerability of VK0214 administered once-daily over a 28-day dosing period. Secondary and exploratory objectives include an evaluation of the pharmacokinetics and pharmacodynamics of VK0214 following 28 days of dosing in this population.
The primary objective of the study is to evaluate the safety and tolerability of VK0214 administered once-daily over a 28-day dosing period. Secondary and exploratory objectives include an evaluation of the pharmacokinetics and pharmacodynamics of VK0214 following 28 days of dosing in this population. Other clinical programs include VK5211, an orally available, non-steroidal selective androgen receptor modulator, or SARM.
Conversely, transgenic mice that overexpress DGAT-1 in adipose tissue are predisposed to obesity when fed a high-fat diet and have elevated levels of circulating free fatty acids.
DGAT-1 null mice exhibit both reduced post-meal plasma triglyceride levels and increased energy expenditure, but have normal levels of circulating free fatty acids. Conversely, transgenic mice that overexpress DGAT-1 in adipose tissue are predisposed to obesity when fed a high-fat diet and have elevated levels of circulating free fatty acids.
No drug-related SAEs were observed in patients receiving VK5211. 7 Our intent is to continue to pursue partnering or licensing opportunities for VK5211 prior to conducting additional clinical studies. Three Pipeline Programs Target Metabolic Disease with Large Unmet Medical Need We have a pipeline with three additional programs targeting metabolic diseases and anemia.
Our intent is to continue to pursue partnering or licensing opportunities for VK5211 prior to conducting additional clinical studies. Three Pipeline Programs Target Metabolic Disease with Large Unmet Medical Need We have a pipeline with three additional programs targeting metabolic diseases and anemia. Our pipeline programs include VK0612, a first-in-class, orally available Phase 2b-ready drug candidate for type 2 diabetes.
VK0214 In the U.S., there are currently no marketed therapies for the treatment of X-ALD. Hematopoietic stem cell therapy has been used to treat the most severe form of X-ALD, cerebral adrenoleukodystrophy, or CALD.
Hematopoietic stem cell therapy has been used to treat the most severe form of X-ALD, cerebral adrenoleukodystrophy, or CALD.
Our pipeline programs include VK0612, a first-in-class, orally available Phase 2b-ready drug candidate for type 2 diabetes. Preliminary clinical data suggest VK0612 has the potential to provide substantial glucose-lowering effects, with an attractive safety and convenience profile compared with existing type 2 diabetes therapies.
Fructose-1,6-bisphosphatase, or FBPase, Inhibitor Program VK0612 is a first-in-class, orally available drug candidate for type 2 diabetes, one of the largest global healthcare challenges today. Preliminary clinical data suggest VK0612 has the potential to provide substantial glucose-lowering effects, with an attractive safety and convenience profile compared with existing type 2 diabetes therapies.
The Voting Agreement will terminate under the same circumstances in which the Management Rights Letter will terminate. Government Regulation FDA Regulation and Marketing Approval In the U.S., the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act of 1938, as amended, or FDCA, and related regulations.
Government Regulation FDA Regulation and Marketing Approval In the U.S., the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act of 1938, as amended, or FDCA, and related regulations. Drugs are also subject to other federal, state and local statutes and regulations.
In September 2020, we initiated a randomized, double-blind, placebo controlled Phase 1 SAD and MAD clinical trial of VK0214 in healthy patients. The primary objective of the study was to evaluate the safety and tolerability of VK0214 administered orally for up to 14 days. The secondary objective was to evaluate the pharmacokinetics of VK0214 following single and multiple oral doses.
The primary objective of the study was to evaluate the safety and tolerability of VK0214 administered orally for up to 14 days. The secondary objective was to evaluate the pharmacokinetics of VK0214 following single and multiple oral doses.
VK2809 in NAFLD 3 In September 2018, we announced top-line results from our 12-week, Phase 2 clinical trial of our lead clinical program’s drug candidate, VK2809, in patients with NAFLD and elevated LDL-C. The study successfully achieved its primary endpoint, with patients receiving VK2809 demonstrating statistically significant reductions in LDL-C compared with placebo.
Results from the biopsy after 52 weeks of dosing are expected to be available in 2024. VK2809 in NAFLD In September 2018, we announced top-line results from our 12-week, Phase 2 clinical trial of our lead clinical program’s drug candidate, VK2809, in patients with NAFLD and elevated LDL-C.
We believe the inhibition of FBPase provides an attractive approach to controlling blood glucose levels in patients with diabetes. VK0612 has demonstrated potent glucose lowering effects in diabetic animal models. Clinical trials have shown that VK0612 is safe, well-tolerated and leads to significant glucose-lowering effects in patients with type 2 diabetes.
VK0612 is a potent, selective inhibitor of FBPase an enzyme that plays an important role in endogenous glucose production, or the synthesis of glucose by the body. We believe the inhibition of FBPase provides an attractive approach to controlling blood glucose levels in patients with diabetes. VK0612 has demonstrated potent glucose lowering effects in diabetic animal models.
In January 2022, we initiated a Phase 1 SAD and MAD clinical trial of VK2735. The Phase 1 trial is a randomized, double-blind, placebo-controlled, SAD and MAD study in healthy adults.
VK2735 is in development for the potential treatment of various metabolic disorders. 1 On March 28, 2023, we announced the completion of the Phase 1 trial. The study was a randomized, double-blind, placebo-controlled, SAD and MAD study in healthy adults.
TRß is known to regulate expression of an alternative VLCFA transporter, known as ABCD2. Various preclinical models have demonstrated that increased expression of ABCD2 can lead to normalization of VLCFA metabolism. Preliminary data suggest that VK0214 stimulates ABCD2 expression in an in vitro model and reduces VLCFA levels in an in vivo model of X-ALD.
X-ALD is caused by mutations in a peroxisomal transporter of VLCFA known as ABCD1. As a result, transporter function is impaired and patients are unable to efficiently metabolize VLCFA. TRß is known to regulate expression of an alternative VLCFA transporter, known as ABCD2. Various preclinical models have demonstrated that increased expression of ABCD2 can lead to normalization of VLCFA metabolism.
Top-line data showed that the trial achieved its primary endpoint, demonstrating statistically significant, dose dependent increases in lean body mass, less head, following treatment with VK5211 as compared to placebo. The study also achieved certain secondary endpoints, demonstrating statistically significant increases in appendicular lean body mass and total lean body mass for all doses of VK5211, compared to placebo.
The study also achieved certain secondary endpoints, demonstrating statistically significant increases in appendicular lean body mass and total lean body mass for all doses of VK5211, compared to placebo. VK5211 demonstrated encouraging safety and tolerability in this study, with no drug-related SAEs reported.
As of the date of issuance of our consolidated financial statements, the extent to which the COVID-19 pandemic may materially impact our financial condition, liquidity or results of operations is still uncertain. 2 Our Development Pipeline The following table highlights our current development pipeline: Key: TRß, thyroid receptor beta; NASH, nonalcoholic steatohepatitis; GLP-1, glucagon-like peptide 1, GIP, glucose-dependent insulinotropic polypeptide; X-ALD, X-linked adrenoleukodystrophy.
Our intent is to continue to pursue partnering or licensing opportunities for VK5211 prior to conducting additional clinical studies. 2 Our Development Pipeline The following table highlights our current development pipeline: Key: TRß, thyroid receptor beta; NASH, nonalcoholic steatohepatitis; GLP-1, glucagon-like peptide 1, GIP, glucose-dependent insulinotropic polypeptide; X-ALD, X-linked adrenoleukodystrophy.
The World Health Organization estimates at least 650 million adults are currently obese worldwide. DGAT-1 is a potential therapeutic target for reduction of triglyceride levels in the circulation and fat accumulation in adipose tissues. DGAT-1 null mice exhibit both reduced post-meal plasma triglyceride levels and increased energy expenditure, but have normal levels of circulating free fatty acids.
According to the CDC, approximately 42% of the adult U.S. population is obese, with the prevalence expected to exceed 50% by 2030. The World Health Organization estimates at least 650 million adults are currently obese worldwide. DGAT-1 is a potential therapeutic target for reduction of triglyceride levels in the circulation and fat accumulation in adipose tissues.
No serious adverse events, or SAEs, have been observed in subjects receiving VK2809 in these completed studies, and overall tolerability remains encouraging. In addition, the compound has been evaluated in chronic toxicity studies of up to 12 months in duration.
Results from the biopsy after 52 weeks of dosing are expected to be available in 2024. VK2809 has been evaluated in eight completed clinical studies, which enrolled more than 300 subjects. No serious adverse events, or SAEs, have been observed in subjects receiving VK2809 in these completed studies, and overall tolerability remains encouraging.
DGAT-1 Inhibitor Program We are developing small molecule inhibitors of the enzyme DGAT-1 for the potential treatment of metabolic disorders such as obesity and dyslipidemia. According to the CDC, approximately 42% of the adult U.S. population is obese, with the prevalence expected to exceed 50% by 2030.
Clinical trials have shown that VK0612 is safe, well-tolerated and leads to significant glucose-lowering effects in patients with type 2 diabetes. DGAT-1 Inhibitor Program We are developing small molecule inhibitors of the enzyme DGAT-1 for the potential treatment of metabolic disorders such as obesity and dyslipidemia.
Preliminary clinical data suggest VK0612 has the potential to provide substantial glucose-lowering effects, with an attractive safety and convenience profile compared with existing type 2 diabetes therapies. VK0612 is a potent, selective inhibitor of FBPase an enzyme that plays an important role in endogenous glucose production, or the synthesis of glucose by the body.
Preliminary clinical data suggest VK0612 has the potential to provide substantial glucose-lowering effects, with an attractive safety and convenience profile compared with existing type 2 diabetes therapies. Our preclinical programs are focused on developing inhibitors of DGAT-1 for the potential treatment of obesity and dyslipidemia and on identifying orally available EPOR agonists for the potential treatment of anemia.
VK0214 in X-linked Adrenoleukodystrophy We are developing VK0214 for X-ALD, a rare X-linked, inherited neurological disorder characterized by a breakdown in the protective barriers surrounding brain and nerve cells. X-ALD is caused by mutations in a peroxisomal transporter of VLCFA known as ABCD1. As a result, transporter function is impaired and patients are unable to efficiently metabolize VLCFA.
The study, which is an extension of our recently completed Phase 1 evaluation of subcutaneously administered VK2735, is evaluating daily oral doses for 28 days. VK0214 in X-ALD 5 We are developing VK0214 for X-ALD, a rare X-linked, inherited neurological disorder characterized by a breakdown in the protective barriers surrounding brain and nerve cells.
In January 2023, we announced completion of patient enrollment in the VOYAGE study and expect to report data for the study’s primary endpoint in the first half of 2023.
In October 2023, we announced completion of patient enrollment in the Phase 2 VENTURE study and we expect to report data from the study in the first half of 2024. On March 28, 2023, we announced the initiation of a Phase 1 clinical study to evaluate a novel oral formulation of VK2735.
Study investigators will also evaluate the pharmacokinetics of single and multiple doses of VK2735. Other clinical programs include VK5211, an orally available, non-steroidal selective androgen receptor modulator, or SARM. In November 2017, we announced positive top-line results from a Phase 2 proof-of-concept clinical trial in 108 patients recovering from non-elective hip fracture surgery.
In November 2017, we announced positive top-line results from a Phase 2 proof-of-concept clinical trial in 108 patients recovering from non-elective hip fracture surgery. Top-line data showed that the trial achieved its primary endpoint, demonstrating statistically significant, dose dependent increases in lean body mass, less head, following treatment with VK5211 as compared to placebo.
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In January 2023, we announced completion of patient enrollment in the VOYAGE study and expect to report data for the study’s primary endpoint in the first half of 2023. VK2809 has been evaluated in eight completed clinical studies, which enrolled more than 300 subjects.
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In January 2023, we announced completion of patient enrollment in the VOYAGE study and in May 2023 we reported that the VOYAGE study successfully achieved its primary endpoint, with patients receiving VK2809 experiencing statistically significant reductions in liver fat content from baseline to Week 12 as compared to placebo.
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VK5211 demonstrated encouraging safety and tolerability in this study, with no drug-related SAEs reported. Our intent is to continue to pursue partnering or licensing opportunities for VK5211 prior to conducting additional clinical studies. Impact of COVID-19 Pandemic We are subject to risks and uncertainties as a result of the COVID-19 pandemic.
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In addition, the compound has been evaluated in chronic toxicity studies of up to 12 months in duration.
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The extent of the impact of the COVID-19 pandemic on our business is highly uncertain and difficult to predict, as the responses that we, other businesses and governments are taking continue to evolve.
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Based upon the results from this Phase 1 study, in September 2023, we initiated the VENTURE study, a Phase 2 clinical trial of VK2735 in patients with obesity. The Phase 2 VENTURE study is a randomized, double-blind placebo-controlled study to evaluate the safety, tolerability, pharmacokinetics and weight loss efficacy of VK2735, administered subcutaneously, once weekly.
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Furthermore, capital markets and economies worldwide have also been negatively impacted by the COVID-19 pandemic, and it is possible that it could cause a local and/or global economic slowdown or recession. Policymakers around the globe have responded with fiscal policy actions to support the healthcare industry and economy as a whole.
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The 13-week study will enroll adults who are obese (BMI >= 30 kg/m2) or adults who are overweight (BMI >= 27kg/m2) with at least one weight-related co-morbidity condition. The primary endpoint of the study is the percent change in body weight from baseline to week 13, with secondary and exploratory endpoints evaluating a range of additional safety and efficacy measures.
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The magnitude and overall effectiveness of these actions remain uncertain. In addition, our clinical trials have been affected by, and may continue to be affected by, the COVID-19 pandemic. Clinical site initiation and patient enrollment have been, and may continue to be, delayed due to the prioritization of hospital resources toward the COVID-19 pandemic.
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The study, which is an extension of our recently completed Phase 1 evaluation of subcutaneously administered VK2735, is evaluating daily oral doses for 28 days.
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Similarly, any inability to recruit and retain patients and principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19, may adversely impact our clinical trial operations.
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In January 2023, we announced completion of patient enrollment in the VOYAGE study and in May 2023 we reported that the VOYAGE study successfully achieved its primary endpoint, with patients receiving VK2809 experiencing statistically significant reductions in 3 liver fat content from baseline to Week 12 as compared to placebo.
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The severity of the impact of the COVID-19 pandemic on our business will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic and the extent and severity of the impact on our service providers, suppliers, contract research organizations, or CROs, and our clinical trials, all of which are uncertain and cannot be predicted, as well as the timing, rollout and availability of vaccines worldwide and the effectiveness thereof, and willingness of the general population to be vaccinated, and the potential emergence and spread of any new variants, including Omicron and sub-variants thereof.
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In January 2022, we announced the initiation of a Phase 1 SAD and MAD clinical trial of VK2735, a novel dual agonist of the GLP-1 and GIP receptors. VK2735 is in development for the potential treatment of various metabolic disorders, including obesity. On March 28, 2023, we announced the completion of the Phase 1 trial.
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Our preclinical programs are focused on developing inhibitors of DGAT-1 for the potential treatment of obesity and dyslipidemia and on identifying orally available EPOR agonists for the potential treatment of anemia. Fructose-1,6-bisphosphatase, or FBPase, Inhibitor Program VK0612 is a first-in-class, orally available drug candidate for type 2 diabetes, one of the largest global healthcare challenges today.
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Based upon the results from this Phase 1 study, in September 2023, we initiated the VENTURE study, a Phase 2 clinical trial of VK2735 in patients with obesity. The Phase 2 VENTURE study is a randomized, double-blind placebo-controlled study to evaluate the safety, tolerability, pharmacokinetics and weight loss efficacy of VK2735, administered subcutaneously, once weekly.
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Most of our programs are based on small molecules licensed from Ligand pursuant to our Master License Agreement with Ligand, which we entered into on May 21, 2014.
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The 13-week study will enroll adults who are obese (BMI >= 30 kg/m2), or adults who are overweight (BMI >= 27kg/m2) with at least one weight-related co-morbidity condition. The primary endpoint of the study is the percent change in body weight from baseline to week 13, with secondary and exploratory endpoints evaluating a range of additional safety and efficacy measures.
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Management Rights Letter As a condition to entering into the Master License Agreement, we entered into a Management Rights Letter with Ligand, dated as of May 21, 2014, or the Management Rights Letter.
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In October 2023, we announced completion of patient enrollment in the Phase 2 VENTURE study and we expect to report data from the study in the first half of 2024. On March 28, 2023, we announced the initiation of a Phase 1 clinical study to evaluate a novel oral formulation of VK2735.
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Pursuant to the Management Rights Letter, we agreed to: (1) expand the size of our board of directors so as to create one new directorship on our board of directors, and (2) appoint an individual named by Ligand, or the Ligand Director, to fill the newly-created directorship.
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Preliminary data suggest that VK0214 stimulates ABCD2 expression in an in vitro model and reduces VLCFA levels in an in vivo model of X-ALD. In September 2020, we initiated a randomized, double-blind, placebo controlled Phase 1 SAD and MAD clinical trial of VK0214 in healthy patients.
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Pursuant to the terms of the Management Rights Letter, the Ligand Director is entitled to receive the same compensation, including cash payments and equity incentive grants, as is provided to our other directors; however, the Ligand Director is not entitled to receive the compensation provided to our directors in their capacity as members of a committee of our board of directors.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeVK2809 While no therapies are currently approved for the treatment of non-alcoholic steatohepatitis, we are aware of numerous development-stage programs targeting this disease, including obeticholic acid from Intercept Pharmaceuticals, Inc., resmetirom (MGL-3196) from Madrigal Pharmaceuticals, Inc., arachidyl amido cholanoic acid from Galmed Pharmaceuticals Ltd., belapectin (GR-MD-02) from Galectin Therapeutics Inc., lanifibranor from Inventiva S.A., semaglutide from Novo Nordisk A/S, firsocostat (GS-0976) and cilofexor (GS-9674) from Gilead Sciences, Inc., tirzepatide from Eli Lilly and Company, ervogastat (PF-06865571) and clesacostat (PF-05221304) from Pfizer Inc., MK-6024 (efinopegdutide) from Merck & Co., Inc., efruxifermin (AKR-001) from Akero 31 Therapeutics, Inc., pegozafermin (BIO89-100) from 89bio, Inc., denifanstat (TVB-2640) from Sagimet Biosciences Inc., cotadutide from AstraZeneca PLC , and GSK4532990 (ARO-HSD) from GlaxoSmithKline plc .
Biggest changeVK2809 While no therapies are currently approved for the treatment of non-alcoholic steatohepatitis, we are aware of numerous development-stage programs targeting this disease, including resmetirom from Madrigal Pharmaceuticals, Inc., arachidyl amido cholanoic acid from Galmed Pharmaceuticals Ltd., belapectin from Galectin Therapeutics Inc., lanifibranor from Inventiva S.A., semaglutide from Novo Nordisk A/S, firsocostat (GS-0976) and cilofexor (GS-9674) from Gilead Sciences, Inc., tirzepatide from Eli Lilly and Company, ervogastat (PF-06865571) and clesacostat (PF-05221304) from Pfizer Inc., efruxifermin (AKR-001) from Akero Therapeutics, Inc., pegozafermin (BIO89-100) from 89bio, Inc., denifanstat (TVB-2640) from Sagimet Biosciences Inc., efocipegtrutide (HM15211) from Hanmi Pharmaceutical Co., Ltd., survodutide (BI 456906) from Boehringer Ingelheim International GmbH, ION224 from Ionis Pharmaceuticals, Inc., rencofilstat (CRV431) from Hepion Pharmaceuticals, Inc., HTD1801 from HighTide Therapeutics Inc., GSK4532990 (ARO-HSD) from GlaxoSmithKline plc., ALN-HSD from Alnylam Pharmaceuticals, Inc./ Regeneron Pharmaceuticals Inc., efinopegdutide (MK-6024) from Merck & Co., Inc., and pemvidutide (ALT-801) from Altimmune, Inc.
If our drug candidates fail to comply with applicable regulatory requirements, a regulatory agency may: • issue warning letters or other notices of possible violations; • impose civil or criminal penalties or fines or seek disgorgement of revenue or profits; 30 • suspend any ongoing clinical trials; • refuse to approve pending applications or supplements to approved applications filed by us or our collaborators; • withdraw any regulatory approvals; • impose restrictions on operations, including costly new manufacturing requirements, or shut down our manufacturing operations; or • seize or detain products or require a product recall.
If our drug candidates fail to comply with applicable regulatory requirements, a regulatory agency may: • issue warning letters or other notices of possible violations; • impose civil or criminal penalties or fines or seek disgorgement of revenue or profits; • suspend any ongoing clinical trials; • refuse to approve pending applications or supplements to approved applications filed by us or our collaborators; • withdraw any regulatory approvals; • impose restrictions on operations, including costly new manufacturing requirements, or shut down our manufacturing operations; or 30 • seize or detain products or require a product recall.
The degree of market acceptance of any of our approved drug candidates will depend on a number of factors, including: • the effectiveness of our approved drug candidates as compared to currently available products; • patient willingness to adopt our approved drug candidates in place of current therapies; • our ability to provide acceptable evidence of safety and efficacy; 34 • relative convenience and ease of administration; • the prevalence and severity of any adverse side effects; • restrictions on use in combination with other products; • availability of alternative treatments; • pricing and cost-effectiveness assuming either competitive or potential premium pricing requirements, based on the profile of our drug candidates and target markets; • effectiveness of our or our partners’ sales and marketing strategy; • our ability to obtain sufficient third-party coverage or reimbursement; and • potential product liability claims.
The degree of market acceptance of any of our approved drug candidates will depend on a number of factors, including: • the effectiveness of our approved drug candidates as compared to currently available products; 34 • patient willingness to adopt our approved drug candidates in place of current therapies; • our ability to provide acceptable evidence of safety and efficacy; • relative convenience and ease of administration; • the prevalence and severity of any adverse side effects; • restrictions on use in combination with other products; • availability of alternative treatments; • pricing and cost-effectiveness assuming either competitive or potential premium pricing requirements, based on the profile of our drug candidates and target markets; • effectiveness of our or our partners’ sales and marketing strategy; • our ability to obtain sufficient third-party coverage or reimbursement; and • potential product liability claims.
In addition, some states have passed laws that require pharmaceutical companies to comply with the April 2003 Office of Inspector General Compliance Program Guidance for Pharmaceutical Manufacturers or the Pharmaceutical Research and Manufacturers of America’s Code on Interactions with 37 Healthcare Professionals.
In addition, some states have passed laws that require 37 pharmaceutical companies to comply with the April 2003 Office of Inspector General Compliance Program Guidance for Pharmaceutical Manufacturers or the Pharmaceutical Research and Manufacturers of America’s Code on Interactions with Healthcare Professionals.
Patents that we currently license and patents that we may own or license in the future do not necessarily ensure the protection of our licensed or owned intellectual property for a number of reasons, including, without limitation, the following: • the patents may not be broad or strong enough to prevent competition from other products that are identical or similar to our drug candidates; • there can be no assurance that the term of a patent can be extended under the provisions of patent term extension afforded by U.S. law or similar provisions in foreign countries, where available; • the issued patents and patents that we may obtain or license in the future may not prevent generic entry into the U.S. market for our drug candidates; • we do not at this time license or own a granted European patent or national phase patents in any European jurisdictions that would prevent generic entry into the European market for one of our primary drug candidates, VK2809; • we, or third parties from who we in-license or may license patents, may be required to disclaim part of the term of one or more patents; • there may be prior art of which we are not aware that may affect the validity or enforceability of a patent claim; • there may be prior art of which we are aware, which we do not believe affects the validity or enforceability of a patent claim, but which, nonetheless, ultimately may be found to affect the validity or enforceability of a patent claim; • there may be other patents issued to others that will affect our freedom to operate; • if the patents are challenged, a court could determine that they are invalid or unenforceable; 46 • there might be a significant change in the law that governs patentability, validity and infringement of our licensed patents or any future patents we may own that adversely affects the scope of our patent rights; • a court could determine that a competitor’s technology or product does not infringe our licensed patents or any future patents we may own; and • the patents could irretrievably lapse due to failure to pay fees or otherwise comply with regulations or could be subject to compulsory licensing.
Patents that we currently license and patents that we may own or license in the future do not necessarily ensure the protection of our licensed or owned intellectual property for a number of reasons, including, without limitation, the following: • the patents may not be broad or strong enough to prevent competition from other products that are identical or similar to our drug candidates; • there can be no assurance that the term of a patent can be extended under the provisions of patent term extension afforded by U.S. law or similar provisions in foreign countries, where available; • the issued patents and patents that we may obtain or license in the future may not prevent generic entry into the U.S. market for our drug candidates; 46 • we do not at this time license or own a granted European patent or national phase patents in any European jurisdictions that would prevent generic entry into the European market for one of our primary drug candidates, VK2809; • we, or third parties from who we in-license or may license patents, may be required to disclaim part of the term of one or more patents; • there may be prior art of which we are not aware that may affect the validity or enforceability of a patent claim; • there may be prior art of which we are aware, which we do not believe affects the validity or enforceability of a patent claim, but which, nonetheless, ultimately may be found to affect the validity or enforceability of a patent claim; • there may be other patents issued to others that will affect our freedom to operate; • if the patents are challenged, a court could determine that they are invalid or unenforceable; • there might be a significant change in the law that governs patentability, validity and infringement of our licensed patents or any future patents we may own that adversely affects the scope of our patent rights; • a court could determine that a competitor’s technology or product does not infringe our licensed patents or any future patents we may own; and • the patents could irretrievably lapse due to failure to pay fees or otherwise comply with regulations or could be subject to compulsory licensing.
Provisions in our amended and restated certificate of incorporation and bylaws, as well as provisions of Delaware law, could make it more difficult or expensive for a third party to acquire us or change our board of directors or current management.
Provisions in our amended and restated certificate of incorporation and our amended and restated bylaws, as well as provisions of Delaware law, could make it more difficult or expensive for a third party to acquire us or change our board of directors or current management.
We may experience numerous unforeseen events during, or as a result of, the development process that could delay or prevent commercialization of our current or future drug candidates, including the following: • clinical trials may produce negative or inconclusive results; • preclinical studies conducted with drug candidates during clinical development to, among other things, evaluate their toxicology, carcinogenicity and pharmacokinetics and optimize their formulation may produce unfavorable results; • patient recruitment and enrollment in clinical trials may be slower than we anticipate; • costs of development may be greater than we anticipate; • our drug candidates may cause undesirable side effects that delay or preclude regulatory approval or limit their commercial use or market acceptance, if approved; • collaborators who may be responsible for the development of our drug candidates may not devote sufficient resources to these clinical trials or other preclinical studies of these candidates or conduct them in a timely manner; or • we may face delays in obtaining regulatory approvals to commence one or more clinical trials.
We may experience numerous unforeseen events during, or as a result of, the development process that could delay or prevent commercialization of our current or future drug candidates, including the following: • clinical trials may produce negative or inconclusive results; • preclinical studies conducted with drug candidates during clinical development to, among other things, evaluate their toxicology, carcinogenicity and pharmacokinetics and optimize their formulation may produce unfavorable results; • patient recruitment and enrollment in clinical trials may be slower than we anticipate; • costs of development may be greater than we anticipate; 23 • our drug candidates may cause undesirable side effects that delay or preclude regulatory approval or limit their commercial use or market acceptance, if approved; • collaborators who may be responsible for the development of our drug candidates may not devote sufficient resources to these clinical trials or other preclinical studies of these candidates or conduct them in a timely manner; or • we may face delays in obtaining regulatory approvals to commence one or more clinical trials.
These provisions include: • authorizing the issuance of “blank check” preferred stock, the terms of which may be established and shares of which may be issued without stockholder approval; • limiting the removal of directors by the stockholders; • creating a classified board of directors; • providing that no stockholder is permitted to cumulate votes at any election of directors; • allowing the authorized number of our directors to be changed only by resolution of our board of directors; • prohibiting stockholder action by written consent, thereby requiring all stockholder actions to be taken at a meeting of our stockholders; • requiring the approval of the holders of at least 66 2/3% of the votes that all our stockholders would be entitled to cast to amend or repeal specified provisions of our charter documents; • eliminating the ability of stockholders to call a special meeting of stockholders; and • establishing advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon at stockholder meetings.
These provisions include: • authorizing the issuance of “blank check” preferred stock, the terms of which may be established and shares of which may be issued without stockholder approval; • limiting the removal of directors by the stockholders; • creating a classified board of directors; • providing that no stockholder is permitted to cumulate votes at any election of directors; 54 • allowing the authorized number of our directors to be changed only by resolution of our board of directors; • prohibiting stockholder action by written consent, thereby requiring all stockholder actions to be taken at a meeting of our stockholders; • requiring the approval of the holders of at least 66 2/3% of the votes that all our stockholders would be entitled to cast to amend or repeal specified provisions of our charter documents; • eliminating the ability of stockholders to call a special meeting of stockholders; and • establishing advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon at stockholder meetings.
Disputes may arise regarding intellectual property subject to a licensing agreement, including, but not limited to: 44 • the scope of rights granted under the license agreement and other interpretation-related issues; • the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement; • the sublicensing of patent and other rights; • our diligence obligations under the license agreement and what activities satisfy those diligence obligations; • the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our collaborators; and • the priority of invention of patented technology.
Disputes may arise regarding intellectual property subject to a licensing agreement, including, but not limited to: • the scope of rights granted under the license agreement and other interpretation-related issues; • the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement; • the sublicensing of patent and other rights; • our diligence obligations under the license agreement and what activities satisfy those diligence obligations; • the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and our collaborators; and • the priority of invention of patented technology.
In addition, once a clinical trial has begun, it may be suspended or terminated by us, our collaborators, the institutional review boards or data safety monitoring boards charged with overseeing our clinical trials, the FDA, EMA or comparable foreign authorities due to a number of factors, including: • failure to conduct the clinical trial in accordance with regulatory requirements or clinical protocols; • inspection of the clinical trial operations or clinical trial site by the FDA, EMA or comparable foreign authorities resulting in the imposition of a clinical hold; • unforeseen safety issues; or • lack of adequate funding to continue the clinical trial.
In addition, once a clinical trial has begun, it may be suspended or terminated by us, our collaborators, the institutional review boards or data safety monitoring boards charged with overseeing our clinical trials, the FDA, EMA or comparable foreign authorities due to a number of factors, including: • failure to conduct the clinical trial in accordance with regulatory requirements or clinical protocols; • inspection of the clinical trial operations or clinical trial site by the FDA, EMA or comparable foreign authorities resulting in the imposition of a clinical hold; 27 • unforeseen safety issues; or • lack of adequate funding to continue the clinical trial.
In addition, if any of our drug candidates receive marketing approval and we or others later identify undesirable side effects caused by the product: 26 • regulatory authorities may withdraw their approval of the product, or we or our partners may decide to cease marketing and sale of the product voluntarily; • we may be required to change the way the product is administered, conduct additional clinical trials or preclinical studies regarding the product, change the labeling of the product, or change the product’s manufacturing facilities; and • our reputation may suffer.
In addition, if any of our drug candidates receive marketing approval and we or others later identify undesirable side effects caused by the product: • regulatory authorities may withdraw their approval of the product, or we or our partners may decide to cease marketing and sale of the product voluntarily; • we may be required to change the way the product is administered, conduct additional clinical trials or preclinical studies regarding the product, change the labeling of the product, or change the product’s manufacturing facilities; and • our reputation may suffer.
If any such inspection or audit identifies a failure to comply with applicable regulations or if a violation of our product specifications or applicable regulations occurs independent of such an inspection or audit, we or the relevant regulatory authority may require remedial measures that may be costly or time consuming for us or a third party to implement, and that may include the temporary or permanent suspension of a clinical trial or commercial sales or the temporary or permanent closure of a facility.
If any such inspection or audit identifies a failure to comply with applicable regulations or if a violation of our product specifications or applicable regulations occurs independent of such an inspection or audit, we or the relevant regulatory authority may require remedial measures that may be costly or time consuming for us or a third party to implement, and that may 33 include the temporary or permanent suspension of a clinical trial or commercial sales or the temporary or permanent closure of a facility.
If the Master License Agreement is terminated in its entirety or with respect to a specific licensed program for any reason, among other consequences, all licenses granted to us under the Master License Agreement (or with respect to the specific licensed program) will terminate and we may be requested to assign and transfer to Ligand certain regulatory documentation and regulatory approvals related to the licensed programs (or those related to the specific licensed program), and we may be required to wind down any ongoing clinical trials with respect to the licensed programs (or those related to the specific licensed program).
If the Master License Agreement is terminated in its entirety or with respect to a specific licensed program for any reason, among other consequences, all licenses granted to us under the Master License Agreement (or with respect to the specific licensed program) will terminate and we may be requested to assign and transfer to Ligand certain regulatory documentation and regulatory approvals related to the licensed programs (or those related to the specific licensed program), and we may be required to wind down any ongoing clinical trials with 44 respect to the licensed programs (or those related to the specific licensed program).
Ligand has the right to terminate the Master License Agreement under certain circumstances, including, but not limited to: (1) in the event of our insolvency or bankruptcy, (2) if we do not pay an undisputed amount owing under the Master License Agreement when 22 due and fail to cure such default within a specified period of time, or (3) if we default on certain of our material obligations and fail to cure the default within a specified period of time.
Ligand has the right to terminate the Master License Agreement under certain circumstances, including, but not limited to: (1) in the event of our insolvency or bankruptcy, (2) if we do not pay an undisputed amount owing under the Master License Agreement when due and fail to cure such default within a specified period of time, or (3) if we default on certain of our material obligations and fail to cure the default within a specified period of time.
Success in early development does not mean that later development will be successful because, for example, drug candidates in later-stage clinical trials may fail to demonstrate sufficient safety and efficacy despite having progressed through initial clinical trials. 23 We licensed most of the intellectual property related to our current drug candidates from Ligand pursuant to the Master License Agreement.
Success in early development does not mean that later development will be successful because, for example, drug candidates in later-stage clinical trials may fail to demonstrate sufficient safety and efficacy despite having progressed through initial clinical trials. We licensed most of the intellectual property related to our current drug candidates from Ligand pursuant to the Master License Agreement.
Such increased expense could make it more difficult to obtain favorable terms in the collaborative arrangements we require to maximize the value of our programs seeking to develop new drug candidates for diabetes. In addition, as a company, we have not previously filed NDAs with the FDA or filed similar applications with other foreign regulatory agencies.
Such increased expense could make it more difficult to obtain favorable terms in the collaborative arrangements we require to maximize the value of 29 our programs seeking to develop new drug candidates for diabetes. In addition, as a company, we have not previously filed NDAs with the FDA or filed similar applications with other foreign regulatory agencies.
For example, in our suit against the Ascletis Defendants that we filed in the Southern District of California, San Diego division in December 2022, we have brought claims related to breach of confidential disclosure agreements. There can be no assurance that we will be successful in this suit. In addition, others may independently discover our trade secrets and proprietary information.
For example, in our suit against the Ascletis Defendants that we filed in the Southern District of California, San Diego division, in December 2022, we brought claims related to breach of confidential disclosure agreements. There can be no assurance that we will be successful in this suit. In addition, others may independently discover our trade secrets and proprietary information.
Our business, financial condition and results of operations would be materially adversely affected if we do not receive approval for reimbursement of our potential products from private insurers on a timely or satisfactory basis. Limitations on coverage could also be imposed at the local Medicare carrier level or by fiscal intermediaries.
Our business, financial condition and results of operations would be materially adversely affected 35 if we do not receive approval for reimbursement of our potential products from private insurers on a timely or satisfactory basis. Limitations on coverage could also be imposed at the local Medicare carrier level or by fiscal intermediaries.
Our business, financial condition and results of operations could be materially 35 adversely affected if Part D prescription drug plans were to limit access to, or deny or limit reimbursement of, our drug candidates or other potential products. Reimbursement systems in international markets vary significantly by country and by region, and reimbursement approvals must be obtained on a country-by-country basis.
Our business, financial condition and results of operations could be materially adversely affected if Part D prescription drug plans were to limit access to, or deny or limit reimbursement of, our drug candidates or other potential products. Reimbursement systems in international markets vary significantly by country and by region, and reimbursement approvals must be obtained on a country-by-country basis.
The accelerated vesting of options and shares of restricted stock could result in dilution to our existing stockholders and lower the market price of our common stock. The payment of these severance benefits could harm our financial condition and results. In addition, these potential severance payments may discourage or prevent third parties from seeking a business combination with us.
The accelerated vesting of 42 options and shares of restricted stock could result in dilution to our existing stockholders and lower the market price of our common stock. The payment of these severance benefits could harm our financial condition and results. In addition, these potential severance payments may discourage or prevent third parties from seeking a business combination with us.
It is not always possible to identify and deter such misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or 41 lawsuits stemming from a failure to be in compliance with such laws or regulations.
It is not always possible to identify and deter such misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations.
We are unable to predict the effect that such sales may have on the prevailing market price of our common stock. Our management will continue to have broad discretion over the use of the proceeds we received from our prior financings and available cash, and might not apply the proceeds in ways that increase the value of your investment.
We are unable to predict the effect that such sales may have on the prevailing market price of our common stock. 53 Our management will continue to have broad discretion over the use of the proceeds we received from our prior financings and available cash, and might not apply the proceeds in ways that increase the value of your investment.
Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate and financial market conditions could adversely impact our business. 43 Risks Relating to Our Intellectual Property We may not be successful in obtaining or maintaining necessary rights to our drug candidates through acquisitions and in-licenses.
Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate and financial market conditions could adversely impact our business. Risks Relating to Our Intellectual Property We may not be successful in obtaining or maintaining necessary rights to our drug candidates through acquisitions and in-licenses.
If these third parties do not successfully carry out their contractual duties, meet expected deadlines, or comply with regulatory requirements, we may not be able to obtain regulatory approval for or commercialize our drug candidates and our business, financial condition and results of operations could be substantially harmed.
If these third parties do not successfully carry out their contractual duties, meet expected deadlines, or comply with regulatory 28 requirements, we may not be able to obtain regulatory approval for or commercialize our drug candidates and our business, financial condition and results of operations could be substantially harmed.
We may not be able to enter into licensing arrangements or make other arrangements at a reasonable cost or on reasonable terms. Any inability to secure licenses or alternative technology could result in delays in the introduction of our products or lead to 47 prohibition of the manufacture or sale of products by us.
We may not be able to enter into licensing arrangements or make other arrangements at a reasonable cost or on reasonable terms. Any inability to secure licenses or alternative technology could result in delays in the introduction of our products or lead to prohibition of the manufacture or sale of products by us.
If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business, financial condition and results of operations. 53 Our ability to use our net operating loss carryforwards may be subject to certain limitations.
If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business, financial condition and results of operations. Our ability to use our net operating loss carryforwards may be subject to certain limitations.
It takes at least six months to obtain approval of the application for patent term extension. We may not be granted an extension because of, for example, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements.
It takes at least six months to obtain approval of the application for patent term extension. We may not be granted an extension because of, for example, 50 failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements.
Our business is substantially dependent upon technology licensed from Ligand. Pursuant to the Master License Agreement, we have been granted exclusive worldwide rights to VK2809, VK0214, VK5211, VK0612 and preclinical programs for metabolic disorders and anemia.
Our business is substantially dependent upon technology licensed from Ligand. Pursuant to the Master License Agreement, we have been granted exclusive worldwide rights to VK2809, VK0214, VK5211, VK0612 and preclinical programs for metabolic disorders 22 and anemia.
We intend to expand our existing pipeline of core assets by advancing drug compounds from current ongoing discovery programs into clinical development. However, the process of researching and discovering drug compounds is expensive, time-consuming and unpredictable.
We intend to expand our existing pipeline of core assets by advancing drug compounds from current ongoing discovery programs into clinical development. However, the process of researching 26 and discovering drug compounds is expensive, time-consuming and unpredictable.
Under the Inflation Reduction Act, Congress authorized Medicare beginning in 2026 to negotiate lower 36 prices for certain costly single-source drug and biologic products that do not have competing generics or biosimilars.
Under the Inflation Reduction Act, Congress authorized Medicare beginning in 2026 to negotiate lower prices for certain costly single-source drug and biologic products that do not have competing generics or biosimilars.
Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” and should be carefully considered, together with other information in this Annual Report on Form 10-K and our other filings with the SEC before making an investment decision regarding our common stock. • We are a clinical-stage company, have a very limited operating history and are expected to incur significant operating losses during the next stages of our corporate development. • We are substantially dependent on technologies we licensed from Ligand, and if we lose the license to such technologies or our master license agreement with Ligand, or the Master License Agreement, is terminated for any reason, our ability to develop existing and new drug candidates would be harmed, and our business, financial condition and results of operations would be materially and adversely affected. • We are dependent on the success of one or more of our current drug candidates and we cannot be certain that any of them will receive regulatory approval or be commercialized. • If development of our drug candidates does not produce favorable results, we and our collaborators, if any, may be unable to commercialize these products. 21 • Delays in the commencement or completion of clinical trials could result in increased costs to us and delay our ability to establish strategic collaborations. • We intend to rely on third parties to conduct our preclinical studies and clinical trials and perform other tasks for us.
Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” and should be carefully considered, together with other information in this Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission, or the SEC, before making an investment decision regarding our common stock. • We are a clinical-stage company, have a very limited operating history and are expected to incur significant operating losses during the next stages of our corporate development. • We are substantially dependent on technologies we licensed from Ligand Pharmaceuticals Incorporated, or Ligand, and if we lose the license to such technologies or our master license agreement with Ligand, or the Master License Agreement, is 21 terminated for any reason, our ability to develop existing and new drug candidates would be harmed, and our business, financial condition and results of operations would be materially and adversely affected. • We are dependent on the success of one or more of our current drug candidates and we cannot be certain that any of them will receive regulatory approval or be commercialized. • If development of our drug candidates does not produce favorable results, we and our collaborators, if any, may be unable to commercialize these products. • Delays in the commencement or completion of clinical trials could result in increased costs to us and delay our ability to establish strategic collaborations. • We intend to rely on third parties to conduct our preclinical studies and clinical trials and perform other tasks for us.
An adverse determination in any such submission, 48 proceeding or litigation could reduce the scope or enforceability of, or invalidate, our patent rights, which could adversely affect our competitive position. In addition, the U.S.
An adverse determination in any such submission, proceeding or litigation could reduce the scope or enforceability of, or invalidate, our patent rights, which could adversely affect our competitive position. In addition, the U.S.
In addition, any adverse developments affecting manufacturing operations for our drug candidates may result in shipment delays, inventory shortages, lot failures, withdrawals or recalls, or other interruptions in the supply of our drug candidates.
In addition, any adverse developments affecting manufacturing operations of our drug candidates may result in shipment delays, inventory shortages, lot failures, withdrawals or recalls, or other interruptions in the supply of our drug candidates.
In addition, terrorist acts or acts of war targeted at the U.S., and specifically the greater San Diego, California region, as well as the ongoing conflict between Ukraine and Russia and the global impact of restrictions and sanctions imposed on Russia, could cause damage or disruption to us, our employees, facilities, partners and suppliers, which could have a material adverse effect on our business, financial condition and results of operations.
In addition, terrorist acts or acts of war targeted at the U.S., and specifically the greater San Diego, California region, as well as the ongoing conflict between Ukraine and Russia and the global impact of restrictions and sanctions imposed on Russia and the Israel-Hamas war, could cause damage or disruption to us, our employees, facilities, partners and suppliers, which could have a material adverse effect on our business, financial condition and results of operations.
We are substantially dependent on technologies we licensed from Ligand, and if we lose the license to such technologies or our master license agreement with Ligand, or the Master License Agreement, is terminated for any reason, our ability to develop existing and new drug candidates would be harmed, and our business, financial condition and results of operations would be materially and adversely affected.
We are substantially dependent on technologies we licensed from Ligand Pharmaceuticals Incorporated, or Ligand, and if we lose the license to such technologies or our master license agreement with Ligand, or the Master License Agreement, is terminated for any reason, our ability to develop existing and new drug candidates would be harmed, and our business, financial condition and results of operations would be materially and adversely affected.
We continue to monitor any adverse impact that the outbreak of war in Ukraine and the subsequent institution of sanctions against Russia by the United States and several European and Asian countries may have on the global economy in general, on our business and operations and on the businesses and operations of our suppliers and other third parties with which we conduct business.
We continue to monitor any adverse impact that the outbreak of war in Ukraine, the subsequent institution of sanctions against Russia by the United States and several European and Asian countries, and the Israel-Hamas war may have on the global economy in general, on our business and operations and on the businesses and operations of our suppliers and other third parties with which we conduct business.
In those countries, as of December 31, 2022, we had several licensed and owned patents and several licensed and owned patent applications and may have limited remedies if such patents are infringed or if we are compelled to grant a license to a third party, which could materially diminish the value of such patents.
In those countries, as of December 31, 2023, we had several licensed and owned patents and several licensed and owned patent applications and may have limited remedies if such patents are infringed or if we are compelled to grant a license to a third party, which could materially diminish the value of such patents.
However, as of December 31, 2022, there is no limitation on the federal and state net operating losses. In addition, current or future changes in our stock ownership may trigger an “ownership change,” some of which may be outside our control.
However, as of December 31, 2023, there is no limitation on the federal and state net operating losses. In addition, current or future changes in our stock ownership may trigger an “ownership change,” some of which may be outside our control.
Sales of a substantial number of shares of our common stock by our existing stockholders, including Ligand, in the public market, or the perception that these sales might occur, could depress the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities.
Sales of a substantial number of shares of our common stock by our existing stockholders in the public market, or the perception that these sales might occur, could depress the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities.
The commencement of clinical trials can be delayed for a variety of reasons, including, but not limited to, delays related to: • obtaining regulatory approval to commence one or more clinical trials; • reaching agreement on acceptable terms with prospective CROs and clinical trial sites; • manufacturing sufficient quantities of a drug candidate or other materials necessary to conduct clinical trials, as well as receiving the supplies and materials needed to conduct our clinical trials, including interruptions in global shipping that may affect the transport of clinical materials; • obtaining institutional review board approval to conduct one or more clinical trials at a prospective site; • recruiting and enrolling patients to participate in one or more clinical trials, especially as patients may be reluctant or unable to visit clinical sites, or may delay seeking treatment for chronic conditions, due to the COVID-19 pandemic; 27 • the failure of our collaborators to adequately resource our drug candidates due to their focus on other programs or as a result of general market conditions; • recruiting clinical site investigators, clinical site staff and potential closure of clinical facilities due to the COVID-19 pandemic; and • changes in regulations as part of a response to the COVID-19 pandemic, which may require us to change the ways in which our clinical trials are conducted.
The commencement of clinical trials can be delayed for a variety of reasons, including, but not limited to, delays related to: • obtaining regulatory approval to commence one or more clinical trials; • reaching agreement on acceptable terms with prospective CROs and clinical trial sites; • manufacturing sufficient quantities of a drug candidate or other materials necessary to conduct clinical trials, as well as receiving the supplies and materials needed to conduct our clinical trials, including interruptions in global shipping that may affect the transport of clinical materials; • obtaining institutional review board approval to conduct one or more clinical trials at a prospective site; • recruiting and enrolling patients to participate in one or more clinical trials, especially as patients may be reluctant or unable to visit clinical sites, or may delay seeking treatment for chronic conditions; • the failure of our collaborators to adequately resource our drug candidates due to their focus on other programs or as a result of general market conditions; • recruiting clinical site investigators, clinical site staff and potential closure of clinical facilities; and • changes in regulations, which may require us to change the ways in which our clinical trials are conducted.
Alternatively, if a court were to find this provision of our amended and restated bylaws inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business, financial condition and results of operations.
Alternatively, if a court were to find this provision of our amended and restated bylaws inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business, financial condition and results of operations. 55 Item 1B.
Since our incorporation in September 2012, our operations have been limited to raising capital, building infrastructure, obtaining the worldwide rights to certain technology from Ligand Pharmaceuticals Incorporated, or Ligand, and planning, preparing and conducting preclinical studies and clinical trials of our drug candidates, including VK2809, VK5211 and VK0612, which are currently in Phase 2 clinical development, VK0214, currently in a Phase 1b clinical trial, and VK2735, which is currently in a Phase 1 SAD/MAD clinical trial, as well as the diacylglycerol acyltransferase-1, or DGAT-1 and erythropoietin receptor, or EPOR, programs, which are each currently in preclinical development.
Since our incorporation in September 2012, our operations have been limited to raising capital, building infrastructure, obtaining the worldwide rights to certain technology from Ligand Pharmaceuticals Incorporated, or Ligand, and planning, preparing and conducting preclinical studies and clinical trials of our drug candidates, including VK2809, VK2735 subcutaneous, VK5211 and VK0612, which are currently in Phase 2 clinical development, VK2735, currently in an oral Phase 1 SAD/MAD clinical trial, and VK0214, currently in a Phase 1b clinical trial, as well as the diacylglycerol acyltransferase-1, or DGAT-1 and erythropoietin receptor, or EPOR, programs, which are each currently in preclinical development.
Item 1A. Risk Factors. You should consider carefully the following information about the risks described below, together with the other information contained in this Annual Report on Form 10-K and in our other public filings in evaluating our business.
Item 1A. Ris k Factors. You should consider carefully the following information about the risks described below, together with the other information contained in this Annual Report on Form 10-K and in our other public filings in evaluating our business.
Zydus Cadila ). VK5211 In the U.S., there are currently no marketed therapies for the maintenance or improvement of lean body mass, bone mineral density or physical function in patients recovering from non-elective hip fracture surgery.
VK5211 In the U.S., there are currently no marketed therapies for the maintenance or improvement of lean body mass, bone mineral density or physical function in patients recovering from non-elective hip fracture surgery.
For example, we are currently aware of at least two third-party companies that are selling products in the U.S. bearing the name “LGD-4033,” which is the name previously used by Ligand to refer to VK5211, without authority from either us or Ligand, and we may experience other potential intellectual property infringement in the future.
For example, we were previously aware of at least two third-party companies that were selling products in the U.S. bearing the name “LGD-4033,” which is the name previously used by Ligand to refer to VK5211, without authority from either us or Ligand, and we may experience other potential intellectual property infringement in the future.
For example, a prolonged conflict may result in increased inflation, escalating energy prices and constrained availability, and thus increasing costs, of raw materials. We will continue to monitor this fluid situation and develop contingency plans as necessary to address any disruptions to our business operations as they develop.
For example, a prolonged conflict in Ukraine or Israel may result in increased inflation, escalating energy prices and constrained availability, and thus increasing costs, of raw materials. We will continue to monitor this fluid situation and develop contingency plans as necessary to address any disruptions to our business operations as they develop.
The impact of the Russian invasion of Ukraine on the global economy, energy supplies and raw materials is uncertain, but may prove to negatively impact our business and operations. The short and long-term implications of Russia’s invasion of Ukraine are difficult to predict at this time.
The impact of the Russian invasion of Ukraine and the Israel-Hamas war on the global economy, energy supplies and raw materials is uncertain, but may prove to negatively impact our business and operations. The short and long-term implications of Russia’s invasion of Ukraine and the Israel-Hamas war are difficult to predict at this time.
Our stock price could be subject to wide fluctuations in response to a variety of factors, including the following: • any delay in filing an NDA for any of our drug candidates and any adverse development or perceived adverse development with respect to the FDA’s review of that NDA; • adverse results or delays in clinical trials, if any; • significant lawsuits, including patent or stockholder litigation; • inability to obtain additional funding; • failure to successfully develop and commercialize our drug candidates; • changes in laws or regulations applicable to our drug candidates; • inability to obtain adequate product supply for our drug candidates, or the inability to do so at acceptable prices; • unanticipated serious safety concerns related to any of our drug candidates; • adverse regulatory decisions; 50 • introduction of new products or technologies by our competitors; • failure to meet or exceed drug development or financial projections we provide to the public; • failure to meet or exceed the estimates and projections of the investment community; • the perception of the biopharmaceutical industry by the public, legislatures, regulators and the investment community; • announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our competitors; • disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our licensed and owned technologies; • additions or departures of key scientific or management personnel; • changes in the market valuations of similar companies; • general economic and market conditions and overall fluctuations in the U.S. equity market; • public health emergencies such as the COVID-19 pandemic; • sales of our common stock by us or our stockholders, including Ligand, in the future; and • trading volume of our common stock.
Our stock price could be subject to wide fluctuations in response to a variety of factors, including the following: • any delay in filing an NDA for any of our drug candidates and any adverse development or perceived adverse development with respect to the FDA’s review of that NDA; • adverse results or delays in clinical trials, if any; • significant lawsuits, including patent or stockholder litigation; • inability to obtain additional funding; • failure to successfully develop and commercialize our drug candidates; • changes in laws or regulations applicable to our drug candidates; • inability to obtain adequate product supply for our drug candidates, or the inability to do so at acceptable prices; • unanticipated serious safety concerns related to any of our drug candidates; • adverse regulatory decisions; • introduction of new products or technologies by our competitors; • failure to meet or exceed drug development or financial projections we provide to the public; • failure to meet or exceed the estimates and projections of the investment community; • the perception of the biopharmaceutical industry by the public, legislatures, regulators and the investment community; • announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our competitors; • disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our licensed and owned technologies; • additions or departures of key scientific or management personnel; • changes in the market valuations of similar companies; • general economic and market conditions and overall fluctuations in the U.S. equity market; • public health emergencies such as the COVID-19 pandemic; • sales of our common stock by us or our stockholders in the future; and • trading volume of our common stock. 51 In addition, the stock market, in general, and small biopharmaceutical companies, in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies.
The expenses incurred by public companies generally to meet SEC reporting, finance and accounting and corporate governance requirements have been increasing in recent years as a result of changes in rules and regulations and the adoption of new rules and regulations applicable to public companies.
The expenses incurred by public companies generally to meet SEC reporting, Sarbanes-Oxley Act compliance, finance and accounting and corporate governance requirements have been increasing in recent years as a result of changes in, and the adoption of, new rules and regulations applicable to public companies.
The California Privacy Rights Act, or the CPRA, which went into effect on January 1, 2023, significantly modified the CCPA, and also created a new state agency that is vested with authority to implement and enforce the CCPA and the CRPA.
The California Privacy Rights Act, or the CPRA, which went into effect on January 1, 2023, amended and expanded the CCPA, and also created a new state agency that is vested with authority to implement and enforce the CCPA and the CRPA.
Since we will be unable to generate sufficient, if any, cash inflows to fund our operations for the foreseeable future, we may need to seek additional equity or debt financing to provide the capital required to maintain or expand our operations. As of December 31, 2022, we had cash, cash equivalents and investments totaling $155.5 million.
Since we will be unable to generate sufficient, if any, cash inflows to fund our operations for the foreseeable future, we may need to seek additional equity or debt financing to provide the capital required to maintain or expand our operations. As of December 31, 2023, we had cash, cash equivalents and investments totaling $362.1 million.
The Securities and Exchange Commission, or the SEC, also may suspend or bar issuers from trading securities on U.S. exchanges for violations of the FCPA’s accounting provisions.
The SEC also may suspend or bar issuers from trading securities on U.S. exchanges for violations of the FCPA’s accounting provisions.
To the extent the war in Ukraine may adversely affect our business as discussed above, it may also have the effect of heightening many of the other risks described herein.
To the extent the wars in Ukraine or Israel may adversely affect our business as discussed above, it may also have the effect of heightening many of the other risks described herein.
Our management owns a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval. As of December 31, 2022, our executive officers, directors and 5% or greater stockholders beneficially owned 29.0% of our common stock.
Our management owns a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval. As of December 31, 2023, our executive officers, directors and 5% or greater stockholders beneficially owned 19.9% of our common stock.
The Federal Trade Commission and state Attorneys General all are aggressive in reviewing privacy and data security protections for consumers. New laws also are being considered at both the state and federal levels.
The Federal Trade Commission and state Attorneys General all are aggressive in reviewing privacy and data security protections for consumers. New laws also are being considered at both the state and federal levels and several states have passed comprehensive privacy laws.
There is no guarantee of success in defending these claims, and even if we are successful, litigation could result in substantial cost and be a distraction to our management and other employees.
There is no guarantee of success in defending these claims, and even if we are successful, litigation could result in substantial cost and be a distraction to our management and other employees. To date, none of our employees have been subject to such claims.
We currently have intellectual property rights to develop our drug candidates through a license from Ligand. As of December 31, 2022, we owned or co-owned 77 patent applications and nine patents.
We currently have intellectual property rights to develop our drug candidates through a license from Ligand. As of December 31, 2023, we owned or co-owned 92 patent applications and 23 patents.
As of December 31, 2022, we had twenty-one full-time employees and a small number of consultants, which may make us more reliant on our individual employees than companies with a greater number of employees. The loss of any of our key personnel, including as a result of the COVID-19 pandemic, could delay or prevent the development of our drug candidates.
As of December 31, 2023, we had twenty-seven full-time employees and a small number of consultants, which may make us more reliant on our individual employees than companies with a greater number of employees. The loss of any of our key personnel could delay or prevent the development of our drug candidates.
Because patents can take many years to issue, there may be currently pending applications of which we are unaware that may later result in issued patents that our drug candidates or potential products infringe. For example, pending applications may exist that claim or can be amended to claim subject matter that our drug candidates or potential products infringe.
Because patents can take many years to issue, there may be currently pending applications of which we are unaware that may later result in issued patents that our drug candidates or potential products infringe.
We also in-licensed one additional U.S. patent and one Japanese patent directed to VK0214, and owned one additional U.S. patent and several patent applications in the U.S. and certain foreign jurisdictions directed to VK2809 as of December 31, 2022.
We also in-licensed one additional U.S. patent and one Japanese patent directed to VK0214, and owned two additional U.S. patents, one PCT application, and several patent applications in the U.S. and certain foreign jurisdictions directed to VK2809 as of December 31, 2023.
Our future capital requirements will depend on many factors, including, but not limited to: 24 • the scope, rate of progress, results and cost of our clinical trials, preclinical studies and other related activities; our ability to establish and maintain strategic collaborations, licensing or other arrangements and the financial terms of such arrangements; • the timing of, and the costs involved in, obtaining regulatory approvals for any of our current or future drug candidates; • the number and characteristics of the drug candidates we seek to develop or commercialize; • the cost of manufacturing clinical supplies, and establishing commercial supplies, of our drug candidates; • the cost of commercialization activities if any of our current or future drug candidates are approved for sale, including marketing, sales and distribution costs; • the expenses needed to attract and retain skilled personnel; • the costs associated with being a public company; • the amount of revenue, if any, received from commercial sales of our drug candidates, should any of our drug candidates receive marketing approval; • the impacts that the COVID-19 global pandemic may have on our business, financial condition and results of operations; disruptions to our operations and clinical trials, as well as disruptions or delays with respect to the operations of our service providers, suppliers and contract research organizations, or CROs; and • the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing possible patent claims, including litigation costs and the outcome of any such litigation.
Our future capital requirements will depend on many factors, including, but not limited to: • the scope, rate of progress, results and cost of our clinical trials, preclinical studies and other related activities; our ability to establish and maintain strategic collaborations, licensing or other arrangements and the financial terms of such arrangements; • the timing of, and the costs involved in, obtaining regulatory approvals for any of our current or future drug candidates; • the number and characteristics of the drug candidates we seek to develop or commercialize; • the cost of manufacturing clinical supplies, and establishing commercial supplies, of our drug candidates; • the cost of commercialization activities if any of our current or future drug candidates are approved for sale, including marketing, sales and distribution costs; • the expenses needed to attract and retain skilled personnel; • the costs associated with being a public company; • the amount of revenue, if any, received from commercial sales of our drug candidates, should any of our drug candidates receive marketing approval; and • the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing possible patent claims, including litigation costs and the outcome of any such litigation.
As of December 31, 2022, we had approximately $55.7 million of federal net operating loss carryforwards, of which $17.8 million will begin to expire in 2032 and the remaining $37.9 million of which can be carried forward indefinitely. We have $51.6 million of state net operating loss carryforwards that will begin to expire in 2034.
As of December 31, 2023, we had approximately $98.7 million of federal net operating loss carryforwards, of which $17.8 million will begin to expire in 2032 and the remaining $80.9 million of which can be carried forward indefinitely. We have $79.9 million of state net operating loss carryforwards that will begin to expire in 2034.
In addition, the COVID-19 pandemic has 28 negatively impacted, and may continue to negatively impact, our ability to recruit and enroll patients for our clinical trials, as they may be reluctant or unable to visit clinical sites, or may delay seeking treatment for chronic conditions.
For example, the COVID-19 pandemic previously negatively impacted our ability to recruit and enroll patients for our clinical trials, as they may be reluctant or unable to visit clinical sites, or may delay seeking treatment for chronic conditions.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a material adverse effect on our business, financial condition and results of operations, and result in the imposition of significant fines or other sanctions against us.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a material adverse effect on our business, financial condition and results of operations, and result in the imposition of significant fines or other sanctions against us. 41 Business disruptions such as natural disasters could seriously harm our future revenues and financial condition and increase our costs and expenses.
As of December 31, 2022, for each of VK2809 and VK0214, we in-licensed three patents in the U.S. and additional patents in certain foreign jurisdictions, and owned or co-owned and in-licensed one U.S. patent, one PCT application, five U.S. patent applications, and additional patents and patent applications in certain foreign jurisdictions.
As of December 31, 2023, for each of VK2809 and VK0214, we in-licensed three patents in the U.S. and additional patents in certain foreign jurisdictions, and owned or co-owned and in-licensed two U.S. patents, six U.S. patent applications, and additional patents and patent applications in certain foreign jurisdictions.
In addition, one of our third-party manufacturers is located in the southeastern part of the United States, an area subject to hurricanes and related natural disasters. Our suppliers may also experience a disruption in their business as a result of natural or man-made disasters.
Our corporate headquarters are located in greater San Diego, California, a region known for seismic activity. In addition, one of our third-party manufacturers is located in the southeastern part of the United States, an area subject to hurricanes and related natural disasters. Our suppliers may also experience a disruption in their business as a result of natural or man-made disasters.
In addition, our CROs are not our employees, and except for remedies available to us under our agreements with such CROs, we cannot control whether or not they devote sufficient time and resources to our ongoing preclinical and clinical programs. In addition, our CROs and their employees may be adversely affected or delayed by the COVID-19 pandemic.
In addition, our CROs are not our employees, and except for remedies available to us under our agreements with such CROs, we cannot control whether or not they devote sufficient time and resources to our ongoing preclinical and clinical programs.
To date, none of our employees have been subject to such claims. 49 We may be subject to claims challenging the inventorship of our licensed patents, any future patents we may own and other intellectual property.
We may be subject to claims challenging the inventorship of our licensed patents, any future patents we may own and other intellectual property.
Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce patents that we might obtain in the future. We may not be able to protect our intellectual property rights throughout the world.
Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce patents that we might obtain in the future.
Obtaining and maintaining patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection for licensed patents, pending patent applications and potential future patent applications and patents could be reduced or eliminated for non-compliance with these requirements. 45 Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and/or patent applications will be due to be paid to the U.S.
Obtaining and maintaining patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection for licensed patents, pending patent applications and potential future patent applications and patents could be reduced or eliminated for non-compliance with these requirements.
Any investigation of any potential violations of the FCPA, the Bribery Act, other anti-corruption laws or Trade Control Laws by United States, United Kingdom or other authorities could also have an adverse impact on our reputation, our business, results of operations and financial condition. 39 Governments outside the United States tend to impose strict price controls, which may adversely affect our revenue, if any.
Any investigation of any potential violations of the FCPA, the Bribery 39 Act, other anti-corruption laws or Trade Control Laws by United States, United Kingdom or other authorities could also have an adverse impact on our reputation, our business, results of operations and financial condition.
In September 2018, we reported positive top-line results from a Phase 2 clinical trial for VK2809. In late 2017, we reported positive top-line results from a Phase 2 clinical trial for VK5211.
In May 2023, we reported positive top-line results from the VOYAGE Phase 2b clinical trial for VK2809. In late 2017, we reported positive top-line results from a Phase 2 clinical trial for VK5211.
If we lose the right to license any of these key compounds, our ability to develop existing and new drug candidates would be harmed.
Therefore, our ability to develop and commercialize our drug candidates depends entirely on the effectiveness and continuation of the Master License Agreement. If we lose the right to license any of these key compounds, our ability to develop existing and new drug candidates would be harmed.
In addition, we are aware of active programs at Aligos Therapeutics, Inc. , Alnylam Pharmaceuticals, Inc., Altimmune , Inc., Arrowhead Pharmaceuticals, Inc., Ascletis Biopharmaceutical, Boehringer Ingelheim International GmbH, Boston Pharmaceuticals Inc., Bristol Myers Squibb, Can- Fite BioPharma Ltd., ChemomAb Ltd., CohBar , Inc., Corcept Therapeutics Inc., CytoDyn Inc., D&D Pharmatech , Inc., Durect Corporation, Enyo Pharma SA, Inc., Future Medicine Co., Ltd., Galecto , Inc., Gelesis Holdings Inc., Hanmi Pharmaceutical Co., Ltd., Hepagene Therapeutics, Inc., Hepion Pharmaceuticals, Inc., HighTide Therapeutics Inc., Ionis Pharmaceuticals, Inc., Johnson & Johnson , Kowa Company, Ltd., MediciNova Inc., NGM Biopharmaceuticals, Inc., NorthSea Therapeutics BV, Novartis Pharmaceuticals Corporation , Poxel SA, Regeneron Pharmaceuticals Inc., Rivus Pharmaceuticals Inc., Seal Rock Therapeutics, Inc., Terns Pharmaceuticals, Inc., Theratechnologies Inc., Yuhan Corporation, and Cadila Healthcare Limited (a.k.a.
In addition, we are aware of active programs at Aligos Therapeutics, Inc., Arrowhead Pharmaceuticals, Inc., Ascletis Biopharmaceutical, AstraZeneca PLC, Boston Pharmaceuticals Inc., Can-Fite BioPharma Ltd., ChemomAb Ltd., CohBar, Inc., Corcept Therapeutics Inc., CytoDyn Inc., D&D Pharmatech, Inc., Durect Corporation, Enyo Pharma SA, Inc., Future Medicine Co., Ltd., Galecto, Inc., Gelesis Holdings Inc., Hepagene Therapeutics, Inc., Kowa Company, Ltd., MediciNova Inc., NGM Biopharmaceuticals, Inc., NorthSea Therapeutics BV, 31 Pliant Therapeutics, Inc., Poxel SA, Seal Rock Therapeutics, Inc., Theratechnologies Inc., Yuhan Corporation, and Cadila Healthcare Limited (a.k.a.
In addition, on August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022, which, among other things, includes policies that are designed to have a direct impact on drug prices and reduce drug spending by the federal government, which shall take effect in 2023.
We cannot predict the consequences or impact that the new regulatory framework will have on our future operations, if any, in these jurisdictions. 36 In addition, on August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022, which, among other things, includes policies that are designed to have a direct impact on drug prices and reduce drug spending by the federal government, which shall take effect in 2023.
Given our lack of current cash inflows, it is expected that we may need to raise additional capital; however, it may be unavailable to us or, even if obtained, may cause dilution or place significant restrictions on our ability to operate our business.
In addition, we may not be able to generate sufficient revenue, even if we are able to commercialize any of our drug candidates, to become profitable. 24 Given our lack of current cash inflows, it is expected that we may need to raise additional capital; however, it may be unavailable to us or, even if capital is obtained, may cause dilution or place significant restrictions on our ability to operate our business.
For example, on September 16, 2011, the Leahy-Smith America Invents Act, or the Leahy-Smith Act, was signed into law. The Leahy-Smith Act included a number of significant changes to U.S. patent law, including provisions that affect the way patent applications will be prosecuted and that may also affect patent litigation.
The Leahy-Smith Act included a number of significant changes to U.S. patent law, including provisions that affect the way patent applications will be prosecuted and that may also affect patent litigation.
Our drug candidates are subject to extensive regulation under the FDA, EMA or comparable foreign authorities, which can be costly and time consuming, cause unanticipated delays or prevent the receipt of the required approvals to commercialize our drug candidates. 29 The clinical development, manufacturing, labeling, storage, record-keeping, advertising, promotion, export, marketing and distribution of our drug candidates are subject to extensive regulation by the FDA and other U.S. regulatory agencies, EMA or comparable authorities in foreign markets.
The clinical development, manufacturing, labeling, storage, record-keeping, advertising, promotion, export, marketing and distribution of our drug candidates are subject to extensive regulation by the FDA and other U.S. regulatory agencies, EMA or comparable authorities in foreign markets.
Our employment agreements with our officers and certain other employees may require us to pay severance benefits to any of those persons who are terminated in connection with a change in control of our company, which could harm our financial condition or results. 42 Our officers and certain employees are parties to employment agreements that contain change in control and severance provisions in the event of a termination of employment in connection with a change in control of our company providing for cash payments for severance and other benefits and acceleration of vesting of stock options and shares of restricted stock.
Our officers and certain employees are parties to employment agreements that contain change in control and severance provisions in the event of a termination of employment in connection with a change in control of our company providing for cash payments for severance and other benefits and acceleration of vesting of stock options and shares of restricted stock.
In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a material adverse effect on the market price of our common stock.
Any of these challenges, regardless of their success, would likely be time-consuming and expensive to defend and resolve and would divert our management and scientific personnel’s time and attention. 48 In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a material adverse effect on the market price of our common stock.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. Our facilities consist of office space in San Diego, California. We lease approximately 7,940 square feet of space for our headquarters in San Diego, California under an agreement that expires on July 31, 2027.
Biggest changeItem 2. Proper ties. Our facilities consist of office space in San Diego, California. We lease approximately 7,940 square feet of space for our headquarters in San Diego, California under an agreement that expires on July 31, 2027.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWe intend to vigorously pursue all of our legal remedies in these litigations, but there is no guarantee that we will be successful in these efforts. Item 4. Mine Safety Disclosures. Not applicable. 55 PART II
Biggest changeWe intend to vigorously pursue all of our legal remedies in these litigations, but there is no guarantee that we will be successful in these efforts. Item 4. Mine Saf ety Disclosures. Not applicable. 58 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePerformance Graph We are a smaller reporting company, as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and are not required to provide a performance graph. Item 6. [Reserved] 56
Biggest changePerformance Graph We were a smaller reporting company, as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, as of December 31, 2023, and are not required to provide a performance graph. Unregistered Sales of Equity Securities None. Issuer Purchases of Equity Securities None. Item 6. [Reserved] 59
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock began trading on the Nasdaq Capital Market on April 28, 2015 and trades under the symbol “VKTX”. Prior to April 28, 2015, there was no public market for our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock began trading on the Nasdaq Capital Market on April 28, 2015 and trades under the symbol “VKTX”. Prior to April 28, 2015, there was no public market for our common stock.
Holders of Record As of December 31, 2022, there were approximately seven stockholders of record of our common stock. Certain shares are held in “street” name and, accordingly, the number of beneficial owners of such shares is not known or included in the foregoing number.
Holders of Record As of December 31, 2023, there were approximately eight stockholders of record of our common stock. Certain shares are held in “street” name and, accordingly, the number of beneficial owners of such shares is not known or included in the foregoing number.

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, 2021, net cash provided by financing activities was $6.9 million, which consisted primarily of proceeds from certain warrant exercises of $7.1 million and proceeds from certain stock option exercises and ESPP purchases of $569,000, partially offset by the value of shares withheld to cover taxes of $707,000.
Biggest changeDuring the year ended December 31, 2022, net cash provided by financing activities was $4.2 million, which consisted primarily of proceeds from the ATM Offering, net of fees of $11.7 million, proceeds from certain warrant exercises of $633,000 and proceeds from ESPP purchases of $215,000, partially offset by $6.8 million in repurchases of our common stock under the Repurchase Program and the New Repurchase Program and the value of shares withheld to cover taxes of $1.5 million. 66 Future Funding Requirements As of December 31, 2023, and based upon our current operating plan, we believe that we will have sufficient cash to meet our projected operating requirements for at least the next 12 months following the issuance of the financial statements.
On March 10, 2022, our board of directors authorized a new stock repurchase program effective March 18, 2022, whereby we may purchase up to $50.0 million in shares of our common stock over a period of up to two years, or the New Repurchase Program.
On March 10, 2022, our board of directors authorized a new stock repurchase program, or the New Repurchase Program, effective March 18, 2022, whereby we may purchase up to $50.0 million in shares of our common stock over a period of up to two years.
We expect that our ongoing research and development expenses will consist of costs incurred for the development of our drug candidates, including, but not limited to: • employee and consultant-related expenses, which will include salaries, benefits and stock-based compensation, and certain consultant fees and travel expenses; • expenses incurred under agreements with investigative sites and CROs, which will conduct a substantial portion of our research and development activities, including studies in NASH, on our behalf; • payments to third-party manufacturers, which will produce our active pharmaceutical ingredients and finished products; • license fees paid to third parties for use of their intellectual property; and • facilities, depreciation and other allocated expenses, which will include direct and allocated expenses for rent and maintenance of facilities and equipment, depreciation of leasehold improvements, equipment and laboratory and other supplies.
We expect that our ongoing research and development expenses will consist of costs incurred for the development of our drug candidates, including, but not limited to: • employee and consultant-related expenses, which will include salaries, benefits and stock-based compensation, and certain consultant fees and travel expenses; 61 • expenses incurred under agreements with investigative sites and CROs, which will conduct a substantial portion of our research and development activities, including studies in NASH, on our behalf; • payments to third-party manufacturers, which will produce our active pharmaceutical ingredients and finished products; • license fees paid to third parties for use of their intellectual property; and • facilities, depreciation and other allocated expenses, which will include direct and allocated expenses for rent and maintenance of facilities and equipment, depreciation of leasehold improvements, equipment and laboratory and other supplies.
As our ESPP also allows for up to one increase in contributions during each purchase period, then as an employee elects to increase their contributions, we treat this as an accounting modification. The pre- and post-modification values are calculated on the date of the modification, and the incremental expense is then amortized over the remaining purchase periods.
As our ESPP also allows for up to one increase in contributions during each purchase period, if an employee elects to increase their contributions, we treat this as an accounting modification. The pre- and post-modification values are calculated on the date of the modification, and the incremental expense is then amortized over the remaining purchase periods.
We will need to raise additional capital to fund our operations and complete our ongoing and planned clinical trials. Although we expect to finance future cash needs through public or private equity or debt offerings, funding may not be 63 available to us on acceptable terms, or at all.
We will need to raise additional capital to fund our operations and complete our ongoing and planned clinical trials. Although we expect to finance future cash needs through public or private equity or debt offerings, funding may not be available to us on acceptable terms, or at all.
For our Employee Stock Purchase Plan, or ESPP, we generally recognize compensation expense for the fair value of the purchase options, as measured on the grant date, and use the graded vesting method to allocate this compensation cost to each purchase period within the related two-year offering period.
For our Employee Stock Purchase Plan, or ESPP, we generally recognize compensation expense for the fair value of the purchase options, as measured on the grant date, and use the graded vesting method to allocate this compensation cost to each purchase period 63 within the related two-year offering period.
Through March 17, 2022, the termination date of the Repurchase Program, we repurchased an aggregate of 1,464,217 shares of our common stock under the Repurchase Program. These shares repurchased by us under the Repurchase Program are being held in treasury until such time as we reissue or retire them.
Through March 17, 2022, the termination date of the Prior Repurchase Program, we repurchased an aggregate of 1,464,217 shares of our common stock under the Prior Repurchase Program. These shares repurchased by us under the Prior Repurchase Program are being held in treasury until such time as we reissue or retire them.
On March 17, 2020, our board of directors authorized a stock repurchase program, whereby we could purchase up to $50.0 million in shares of our common stock and outstanding warrants to purchase our common stock, over a period of up to two years, or the Repurchase Program.
On March 17, 2020, our board of directors authorized a stock repurchase program, or the Prior Repurchase Program, whereby we could purchase up to $50.0 million in shares of our common stock and outstanding warrants to purchase our common stock, over a period of up to two years.
Net Cash Provided by Investing Activities During the year ended December 31, 2022, net cash provided by investing activities of $54.8 million resulted from the proceeds of maturities of investments of $176.2 million, partially offset by the purchase of investments of $121.4 million.
During the year ended December 31, 2022, net cash provided by investing activities of $54.8 million resulted from the proceeds of maturities of investments of $176.2 million, offset by the purchase of investments of $121.4 million.
The New Repurchase Program may be carried out at the discretion of a committee of our board of directors through open market purchases, one or more Rule 10b5-1 trading plans, block trades and in privately negotiated transactions. Through December 31, 2022, we repurchased an aggregate of 729,034 shares of our common stock under the New Repurchase Program.
The New Repurchase Program may be carried out at the discretion of a committee of our board of directors through open market purchases, one or more Rule 10b5-1 trading plans, block trades and in privately negotiated transactions. Through December 31, 2023, we repurchased an aggregate of 729,034 shares of our common stock under the New Repurchase Program.
Wainwright & Co. LLC, collectively, the Agents, pursuant to which we may offer and sell, from time to time, through or to the Agents, as sales agent or principal, or the ATM Offering, shares of our common stock having an aggregate offering price of up to $125.0 million, or the ATM Shares.
LLC, collectively, the Agents, pursuant to which we may offer and sell, from time to time, through or to the Agents, as sales agent or principal, or the ATM Offering, shares of our common stock having an aggregate offering price of up to $125.0 million, or the ATM Shares.
The Phase 1b trial is a multi-center, randomized, double-blind, placebo-controlled study in adult male patients with the adrenomyeloneuropathy, or AMN, form of X-ALD. The study is initially targeting enrollment across three cohorts: placebo, VK0214 20 mg daily, and VK0214 40 mg daily. Pending a blinded review of preliminary safety, tolerability, and pharmacokinetic data, additional dosing cohorts may be pursued.
This trial is a multi-center, randomized, double-blind, placebo-controlled study in adult male patients with the adrenomyeloneuropathy, or AMN, form of X-ALD. The study is initially targeting enrollment across three cohorts: placebo, VK0214 20 mg daily, and VK0214 40 mg daily. Pending a blinded review of preliminary safety, tolerability, and pharmacokinetic data, additional dosing cohorts may be pursued.
Results of Operations Comparison of the Years Ended December 31, 2022 and 2021 Research and Development Expenses The following table summarizes our research and development expenses for the years ended December 31, 2022 and 2021 (in thousands, except % change) .
Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 Research and Development Expenses The following table summarizes our research and development expenses for the years ended December 31, 2023 and 2022 (in thousands, except % change).
During the year ended December 31, 2021, net cash used in operating activities of $47.6 million primarily reflected our net losses for the period, adjusted by non-cash charges such as stock-based compensation, amortization of investment premiums, amortization of right of use assets, amortization of financing costs, and interest expense related to operating lease liability as well as changes in our working capital accounts, primarily consisting of an increase in accrued interest, net of interest received on maturity of investments and a decrease in lease liability, partially offset by an increase in prepaids and other current assets and a decrease in accounts payable and accrued expenses.
During the year ended December 31, 2022, net cash used in operating activities of $48.4 million primarily reflected our net losses for the period, adjusted by non-cash charges such as stock-based compensation, amortization of investment premiums, amortization of right of use assets, amortization of financing costs, and interest expense related to operating lease liability as well as changes in our working capital accounts, primarily consisting of an increase in accounts payable, accrued expenses and accrued interest, net of interest received on maturity of investments, partially offset by a decrease in lease liability and an increase in prepaids and other current assets.
The following table summarizes our cash flows for the periods indicated below (in thousands): 2022 2021 Net cash used in operating activities $ (48,397 ) $ (47,586 ) Net cash provided by investing activities $ 54,753 $ 37,960 Net cash provided by financing activities $ 4,163 $ 6,880 Net Cash Used in Operating Activities During the year ended December 31, 2022, net cash used in operating activities of $48.4 million primarily reflected our net losses for the period, adjusted by non-cash charges such as stock-based compensation, amortization of investment premiums, amortization of right of use assets, amortization of financing costs, and interest expense related to operating lease liability as well as changes in our working capital accounts, primarily consisting of an increase in accounts payable, accrued expenses and accrued interest, net of interest received on maturity of investments, partially offset by a decrease in lease liability and an increase in prepaids and other current assets.
The following table summarizes our cash flows for the periods indicated below (in thousands): 2023 2022 2021 Net cash used in operating activities $ (73,376 ) $ (48,397 ) $ (47,586 ) Net cash (used in) provided by investing activities $ (179,086 ) $ 54,753 $ 37,960 Net cash provided by financing activities $ 271,376 $ 4,163 $ 6,880 Net Cash Used in Operating Activities During the year ended December 31, 2023, net cash used in operating activities of $73.4 million primarily reflected our net losses for the period, adjusted by non-cash charges such as stock-based compensation, amortization of investment premiums, amortization of right-of-use assets, amortization of financing costs, and interest expense related to operating lease liabilities as well as changes in our working capital accounts, primarily consisting of an increase in accrued interest, net of interest received on maturity of investments, partially offset by a decrease in prepaid expenses and other assets and decreases in accounts payable, accrued expenses and lease liability.
The Repurchase Program may be carried out at the discretion of a committee of our board of directors through 62 open market purchases, one or more Rule 10b5-1 trading plans, block trades or privately negotiated transactions.
The Prior Repurchase Program was carried out at the discretion of a committee of our board of directors through open market purchases, one or more Rule 10b5-1 trading plans, block trades or privately negotiated transactions.
While our significant accounting policies are more fully described in Note 1 to our financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the following accounting policies will be critical to understanding our historical and future performance, as these policies relate to the significant areas involving management’s judgments and estimates in the preparation of our financial statements.
While our significant accounting policies are more fully described in Note 1 to our financial statements included elsewhere in this Annual Report on Form 10-K, we believe that the following accounting policies will be critical to understanding our historical and future performance, as these policies relate to the significant areas involving management’s judgments and estimates in the preparation of our financial statements. 62 Research and Development All costs of research and development are expensed in the period incurred.
No serious adverse events, or SAEs, have been observed in subjects receiving VK2809 in these completed studies, and overall tolerability remains encouraging. In addition, the compound has been evaluated in chronic toxicity studies of up to 12 months in duration.
In addition, the compound has been evaluated in chronic toxicity studies of up to 12 months in duration. VK2809 has been evaluated in eight completed clinical studies, which enrolled more than 300 subjects. No serious adverse events, or SAEs, have been observed in subjects receiving VK2809 in these completed studies, and overall tolerability remains encouraging.
As of December 31, 2022, we had cash, cash equivalents and short-term investments of $155.5 million. As such, we believe our cash, cash equivalents and short-term investments will be sufficient to fund our operations through at least the first quarter of 2024, which is more than one year after the date our December 31, 2022 financial statements were issued.
As such, we believe our cash, cash equivalents and short-term investments will be sufficient to fund our operations through at least the first quarter of 2025, which is more than one year after the date our December 31, 2023 financial statements were issued.
Other Income (Expense) The following table summarizes our other income (expense) for the years ended December 31, 2022 and 2021 (in thousands, except % change) .
Other Income, net The following table summarizes our other income, net for the years ended December 31, 2023 and 2022 (in thousands, except % change).
Any ATM Shares offered and sold in the ATM Offering are to be issued pursuant to the Shelf Registration Statement and the 424(b) prospectus supplement relating to the ATM Offering dated August 11, 2021. The Shelf Registration Statement will expire on August 11, 2024.
Any ATM Shares offered and sold in the ATM Offering are to be issued pursuant to the Shelf Registration Statement and the 424(b) prospectus supplement relating to the ATM Offering dated August 11, 2021. The 2021 Shelf Registration Statement terminated on July 26, 2023.
Year Ended December 31, $ Change % Change 2022 2021 Other income (expense) $ 1,488 $ 692 $ 796 115.0 % Other income (expense) recognized during the year ended December 31, 2022 consisted primarily of interest income, offset by expense relating to the amortization of certain financing costs and realized loss on investment.
Other income, net recognized during the year ended December 31, 2022 consisted primarily of interest income, offset by expense relating to the amortization of certain financing costs and realized loss on investment.
In January 2022, we initiated a Phase 1 single ascending dose, or SAD, and multiple ascending dose, or MAD, clinical trial of VK2735, a novel dual agonist of the glucagon-like peptide 1, or GLP-1, and glucose-dependent insulinotropic polypeptide, or GIP, receptors.
In January 2022, we announced the initiation of a Phase 1 single ascending dose, or SAD, and multiple ascending dose, or MAD, clinical trial of VK2735, a novel dual agonist of the glucagon-like peptide 1, or GLP-1, and glucose-dependent insulinotropic polypeptide, or GIP, receptors. VK2735 is in development for the potential treatment of various metabolic disorders.
Year Ended December 31, $ Change % Change 2022 2021 Research and development expenses $ 54,234 $ 44,981 $ 9,253 20.6 % The increase in research and development expenses during the year ended December 31, 2022 as compared to the year ended December 31, 2021 was primarily due to increased expenses related to manufacturing for our drug candidates, pre-clinical studies, salaries and benefits and stock-based compensation, partially offset by a decrease in services provided by third-party consultants and clinical studies. 61 General and Administrative Expenses The following table summarizes our general and administrative expenses for the years ended December 31, 2022 and 2021 (in thousands, except % change) .
Year Ended December 31, $ Change % Change 2023 2022 Research and development expenses $ 63,806 $ 54,234 $ 9,572 17.6 % The increase in research and development expenses during the year ended December 31, 2023 as compared to the year ended December 31, 2022 was primarily due to increased expenses related to pre-clinical studies, stock-based compensation, manufacturing for our drug candidates, salaries and benefits and services provided by third-party consultants, partially offset by a decrease in expenses related to clinical studies.
Accordingly, assets acquired in the preclinical and clinical stages of development are expensed as incurred in our statement of operations. 60 Stock-Based Compensation We generally use the straight-line method to allocate compensation cost to reporting periods over each optionee’s requisite service period, which is generally the vesting period, and estimate the fair value of stock-based awards or restricted stock units to employees and directors using the Black-Scholes option-valuation model.
Stock-Based Compensation We generally use the straight-line method to allocate compensation cost to reporting periods over each optionee’s requisite service period, which is generally the vesting period, and estimate the fair value of stock-based awards or restricted stock units to employees and directors using the Black-Scholes option-valuation model.
The primary objective of the study is to evaluate the safety and tolerability of VK0214 administered once-daily over a 28-day dosing period. Secondary and exploratory objectives include an evaluation of the pharmacokinetics and pharmacodynamics of VK0214 following 28 days of dosing in this population.
The primary objective of the study is to evaluate the safety and tolerability of VK0214 administered once-daily over a 28-day dosing period. Secondary and exploratory objectives include an evaluation of the pharmacokinetics and pharmacodynamics of VK0214 following 28 days of dosing in this population. Other clinical programs include VK5211, an orally available, non-steroidal selective androgen receptor modulator, or SARM.
During the year ended December 31, 2021, we incurred $45.0 million in research and development expense primarily related to our efforts in conducting the VK2809 Phase 2b VOYAGE clinical trial and the VK0214 Phase 1 clinical trial in healthy subjects, preparing for and initiating the VK0214 Phase 1b clinical trial and preparing for the initiation of the VK2735 Phase 1 clinical trial.
During the year ended December 31, 2022, we incurred $54.2 million in research and development expense primarily related to our efforts in conducting the VK2809 Phase 2b VOYAGE clinical trial, the VK2735 Phase 1 clinical trial and the VK0214 Phase 1b clinical trial.
VK5211 demonstrated encouraging safety and tolerability in this study, with no drug-related SAEs reported. Our intent is to continue to pursue partnering or licensing opportunities for VK5211 prior to conducting additional clinical studies. We were incorporated under the laws of the State of Delaware on September 24, 2012.
Our intent is to continue to pursue partnering or licensing opportunities for VK5211 prior to conducting additional clinical studies. We were incorporated under the laws of the State of Delaware on September 24, 2012.
Net Cash Provided by Financing Activities During the year ended December 31, 2022, net cash provided by financing activities was $4.2 million, which consisted primarily of proceeds from the ATM Offering, net of fees of $11.7 million, proceeds from certain warrant exercises of $633,000 and proceeds from ESPP purchase of $215,000, partially offset by $6.8 million in repurchases of our common stock under the Repurchase Program and the New Repurchase Program and the value of shares withheld to cover taxes of $1.5 million.
Net Cash Provided by Financing Activities During the year ended December 31, 2023, net cash provided by financing activities was $271.4 million, which consisted primarily of proceeds from the issuance of common stock, net of discount, of $269.8 million in the April 2023 Offering, proceeds from certain option exercises of $6.8 million and proceeds from the ATM Offering, net of fees of $2.0 million, partially offset by value of shares withheld to cover taxes of $7.1 million.
In addition, as a smaller reporting company, we have the ability to take advantage of several “scaled disclosure” accommodations in accordance with the smaller reporting company rules. 59 Critical Accounting Policies and Estimates Our management’s discussion and analysis of financial condition and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.
Critical Accounting Policies and Estimates Our management’s discussion and analysis of financial condition and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.
Year Ended December 31, $ Change % Change 2022 2021 General and administrative expenses $ 16,121 $ 10,701 $ 5,420 50.6 % The increase in general and administrative expenses during the year ended December 31, 2022 as compared to the year ended December 31, 2021 was primarily due to increased expenses related to legal services, stock-based compensation, salaries and benefits, and insurance, partially offset by decreased expenses related to professional fees and services provided by third-party consultants.
Year Ended December 31, $ Change % Change 2023 2022 General and administrative expenses $ 37,021 $ 16,121 $ 20,900 129.6 % The increase in general and administrative expenses during the year ended December 31, 2023 as compared to the year ended December 31, 2022 was primarily due to increased expenses related to legal and patent services, stock-based compensation, third-party consultants and salaries and benefits.
Specific terms and prices will be determined at the time of each offering under a separate prospectus supplement, which will be filed with the SEC at the time of any offering. On July 28, 2021, we entered into an At-The-Market Equity Offering Sales Agreement, or the ATM Agreement, with Stifel, Nicolaus & Company, Incorporated, Truist Securities, Inc. and H.C.
On July 28, 2021, we entered into an At-The-Market Equity Offering Sales Agreement, or the ATM Agreement, with Stifel, Nicolaus & Company, Incorporated, Truist Securities, Inc. and H.C. Wainwright & Co.
During the year ended December 31, 2021, net cash provided by investing activities of $38.0 million resulted from the proceeds of maturities of investments of $206.0 million, partially offset by the purchase of investments of $168.0 million.
Net Cash Provided by Investing Activities During the year ended December 31, 2023, net cash used in investing activities of $179.1 million resulted from the purchase of investments of $478.3 million, offset by the proceeds of maturities of investments of $299.2 million.
From its inception through December 31, 2022, 1.4 million shares of our common stock were sold under the ATM Agreement for aggregate net proceeds to us of approximately $11.7 million.
From its inception through the termination of the 2021 Shelf Registration Statement, 1,587,404 shares of our common stock were sold pursuant to the ATM Offering for aggregate net proceeds to us of approximately $13.6 million.
Top-line data showed that the trial achieved its primary endpoint, demonstrating statistically significant, dose dependent increases in lean body mass, less head, following treatment with VK5211 as compared to placebo. The study also achieved certain secondary endpoints, demonstrating statistically significant increases in appendicular lean body mass and total lean body mass for all doses of VK5211, compared to placebo.
The study also achieved certain secondary endpoints, demonstrating statistically significant increases in appendicular lean body mass and total lean body mass for all doses of VK5211, compared to placebo. VK5211 demonstrated encouraging safety and tolerability in this study, with no drug-related SAEs reported.
We do not expect to receive any revenue from any drug candidates that we develop unless and until we obtain regulatory approval for, and commercialize, our drug candidates or enter into collaborative agreements with third parties. 58 Research and Development Expenses During the year ended December 31, 2022, we incurred $54.2 million in research and development expense primarily related to our efforts in conducting the VK2809 Phase 2b VOYAGE clinical trial, the VK0214 Phase 1b clinical trial and the VK2735 Phase 1 clinical trial.
Research and Development Expenses During the year ended December 31, 2023, we incurred $63.8 million in research and development expense primarily related to our efforts in conducting the VK2809 Phase 2b VOYAGE clinical trial, the VK2735 Phase 2 VENTURE clinical trial, the VK2735 Phase 1 clinical trial and the VK0214 Phase 1b clinical trial.
The primary objectives of the study include evaluation of the safety and tolerability of single and multiple doses of VK2735 delivered subcutaneously and the identification of VK2735 doses suitable for further clinical development. Study investigators will also evaluate the pharmacokinetics of single and multiple doses of VK2735.
On March 28, 2023, we announced the completion of the Phase 1 trial. The study was a randomized, double-blind, placebo-controlled, SAD and MAD study in healthy adults. The primary objectives of the study included evaluation of the safety and tolerability of single and multiple doses of VK2735 delivered subcutaneously and the identification of VK2735 doses suitable for further clinical development.
Other income (expense) recognized during the year ended December 31, 2021 consisted primarily of interest income and foreign exchange gain, offset by expense relating to the amortization of certain financing costs. Liquidity and Capital Resources We have incurred losses and negative cash flows from operations and have not generated any revenues since our inception.
Liquidity and Capital Resources We have incurred losses and negative cash flows from operations and have not generated any revenues since our inception. As of December 31, 2023, we had cash, cash equivalents and short-term investments of $362.1 million.
Other clinical programs include VK5211, an orally available, non-steroidal selective androgen receptor modulator, or SARM. In November 2017, we announced positive top-line results from a Phase 2 proof-of-concept clinical trial in 108 patients recovering from non-elective hip fracture surgery.
In November 2017, we announced positive top-line results from a Phase 2 proof-of-concept clinical trial in 108 patients recovering from non-elective hip fracture surgery. Top-line data showed that the trial achieved its primary endpoint, demonstrating statistically significant, dose dependent increases in lean body mass, less head, following treatment with VK5211 as compared to placebo.
These shares repurchased by us under the New Repurchase Program are being held in treasury until such time as we reissue or retire them.
These shares repurchased by us under the New Repurchase Program are being held in treasury until such time as we reissue or retire them. 65 On July 26, 2023, we filed an automatic universal shelf registration statement on Form S-3 (File No. 333-273460) as a well-known seasoned issuer as defined in Rule 405 under the Securities Act of 1933, as amended, which became effective upon filing, or the 2023 Shelf Registration Statement.
Research and Development All costs of research and development are expensed in the period incurred.
Accordingly, assets acquired in the preclinical and clinical stages of development are expensed as incurred in our statement of operations.
Removed
Secondary objectives include evaluation of histologic changes assessed by hepatic biopsy after 52 weeks of dosing. In January 2023, we announced completion of patient enrollment in the VOYAGE study and expect to report data for the study’s primary endpoint in the first half of 2023. VK2809 has been evaluated in eight completed clinical studies, which enrolled more than 300 subjects.
Added
Secondary objectives include evaluation of histologic changes assessed by hepatic biopsy after 52 weeks of dosing.
Removed
VK2735 is in development for the potential treatment of various metabolic disorders. 57 The Phase 1 trial is a randomized, double-blind, placebo-controlled, SAD and MAD study in healthy adults.
Added
In January 2023, we announced completion of patient enrollment in the VOYAGE study and in May 2023 we reported that the VOYAGE study successfully achieved its primary endpoint, with patients receiving VK2809 experiencing statistically significant reductions in liver fat content from baseline to Week 12 as compared to placebo.
Removed
Impact of COVID-19 Pandemic We are subject to risks and uncertainties as a result of the COVID-19 pandemic. The extent of the impact of the COVID-19 pandemic on our business is highly uncertain and difficult to predict, as the responses that we, other businesses and governments are taking continue to evolve.
Added
Results from the biopsy after 52 weeks of dosing are expected to be available in 2024. VK2809 has been evaluated in eight completed clinical studies, which enrolled more than 300 subjects. No serious adverse events, or SAEs, have been observed in subjects receiving VK2809 in these completed studies, and overall tolerability remains encouraging.
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Furthermore, capital markets and economies worldwide have also been negatively impacted by the COVID-19 pandemic, and it is possible that it could cause a local and/or global economic slowdown or recession. Policymakers around the globe have responded with fiscal policy actions to support the healthcare industry and economy as a whole.
Added
In addition, the compound has been evaluated in chronic toxicity studies of up to 12 months in duration.
Removed
The magnitude and overall effectiveness of these actions remain uncertain. In addition, our clinical trials have been affected by and may continue to be affected by the COVID-19 pandemic. Clinical site initiation and patient enrollment have been, and may continue to be delayed due to the prioritization of hospital resources toward the COVID-19 pandemic.
Added
Study investigators also evaluated the pharmacokinetics of single and multiple doses of VK2735. Based upon the results from this Phase 1 study, in September 2023, we initiated the VENTURE study, a Phase 2 clinical trial of VK2735 in patients with obesity.
Removed
Similarly, any inability to recruit and retain patients and principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19, may adversely impact our clinical trial operations.
Added
The Phase 2 VENTURE study is a randomized, double-blind placebo-controlled study to evaluate the safety, tolerability, pharmacokinetics and weight loss efficacy of VK2735, administered subcutaneously, once weekly. The 13-week study will enroll adults who are obese (BMI >= 30 kg/m2) or adults who are overweight (BMI >= 27kg/m2) with at least one weight-related co-morbidity condition.
Removed
The severity of the impact of the COVID-19 pandemic on our business will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic and the extent and severity of the impact on our service providers, suppliers, contract research organizations, or CROs, and our clinical trials, all of which are uncertain and cannot be predicted, as well as the timing, rollout and availability of vaccines worldwide and the effectiveness thereof, and the willingness of the general population to be vaccinated, and the potential emergence and spread of any new variants, including Omicron and sub-variants thereof.
Added
The primary endpoint of the study is the percent change in body weight from baseline to week 13, with secondary and exploratory endpoints evaluating a range of additional safety and efficacy measures.
Removed
As of the date of issuance of our financial statements, the extent to which the COVID-19 pandemic may materially impact our financial condition, liquidity or results of operations is still uncertain. Financial Operations Overview Revenues To date, we have not generated any revenue.
Added
In October 2023, we announced completion of patient enrollment in the Phase 2 VENTURE study and we expect to report data from the study in the first half of 2024. 60 On March 28, 2023, we announced the initiation of a Phase 1 clinical study to evaluate a novel oral formulation of VK2735.
Removed
Smaller Reporting Company and Non-Accelerated Filer Our public float on June 30, 2022 was less than $700 million and our annual revenues are less than $100 million, and we are therefore deemed a smaller reporting company and a non-accelerated filer.
Added
The study, which is an extension of our recently completed Phase 1 evaluation of subcutaneously administered VK2735, is evaluating daily oral doses for 28 days.
Removed
As a non-accelerated filer and in accordance with these new rules, we continue to not be required to provide an auditor’s attestation report on our internal control over financial reporting in this and potentially future annual reports on Form 10-K as otherwise required by Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended.
Added
Financial Operations Overview Revenues To date, we have not generated any revenue. We do not expect to receive any revenue from any drug candidates that we develop unless and until we obtain regulatory approval for, and commercialize, our drug candidates or enter into collaborative agreements with third parties.
Removed
The Shelf Registration Statement was declared effective by the SEC on August 11, 2021 and will expire on August 11, 2024. Pursuant to the Shelf Registration Statement, we may offer additional securities from time to time and through one or more methods of distribution, subject to market conditions and our capital needs.
Added
General and Administrative Expenses The following table summarizes our general and administrative expenses for the years ended December 31, 2023 and 2022 (in thousands, except % change).
Removed
Future Funding Requirements As of December 31, 2022, and based upon our current operating plan, we believe that we will have sufficient cash to meet our projected operating requirements for at least the next 12 months following the issuance of the financial statements.
Added
Year Ended December 31, $ Change % Change 2023 2022 Other income, net $ 14,932 $ 1,488 $ 13,444 903.5 % 64 Other income, net recognized during the year ended December 31, 2023 consisted primarily of interest income, partially offset by expense relating to the amortization of certain financing costs.
Added
Comparison of the Years Ended December 31, 2022 and 2021 For a discussion regarding our financial condition and results of operations for the year ended December 31, 2022 as compared to the year ended December 31, 2021, please refer to the discussion under the heading “Results of Operations—Comparison of the Years Ended December 31, 2022 and 2021” in Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 10, 2023.
Added
The Shelf Registration Statement was declared effective by the SEC on August 11, 2021 and the offering of all remaining unsold securities under the 2021 Shelf Registration Statement terminated on July 26, 2023.
Added
The 2023 Shelf Registration Statement allows us to offer an indeterminate amount of securities, including equity securities, debt securities, warrants, rights, units and depositary shares, from time to time as described in the 2023 Shelf Registration Statement. The specific terms of any offering under the 2023 Shelf Registration Statement will be established at the time of such offering.
Added
The 2023 Shelf Registration Statement will expire on July 26, 2026. On July 26, 2023, we entered into an Amendment No. 1 to At-The-Market Equity Offering Sales Agreement, or the ATM Agreement Amendment, with Stifel, Nicolaus & Company, Incorporated, Truist Securities, Inc., H.C. Wainwright & Co. LLC and BTIG, LLC.
Added
Pursuant to the ATM Agreement Amendment, BTIG, LLC was added as a sales agent for the ATM Offering and the ATM Agreement was amended to provide that the ATM Offering could be conducted off of registration statements on Form S-3 subsequently filed by us.
Added
Any ATM Shares offered and sold in the ATM Offering will now be issued pursuant to the 2023 Shelf Registration Statement and the prospectus relating to the ATM Offering, dated July 26, 2023, that was included in the 2023 Shelf Registration Statement, or the ATM Prospectus. The 2023 Shelf Registration Statement will expire on July 26, 2026.
Added
From the date of the ATM Prospectus through December 31, 2023, no shares of our common stock were sold pursuant to the ATM Offering and, as of December 31, 2023, we may sell shares of our common stock for remaining gross proceeds of up to $200.0 million from time to time pursuant to the ATM Prospectus.

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 Qualitative Disclosures About Market Risk. We are a smaller reporting company, as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, and are not required to provide the information required under this item. Item 8. Financial Statements and Supplementary Data.
Biggest changeItem 7A. Quantitative and Qualitati ve Disclosures About Market Risk. We were a smaller reporting company, as defined by Rule 12b-2 of the Securities Exchange Act of 1934, as amended, as of December 31, 2023, and are not required to provide the information required under this item. Item 8. Financial Statement s and Supplementary Data.
The information required by this Item 8 is contained on the pages indicated in Part IV, Item 15(a)(1) of this Annual Report on Form 10-K. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.
The information required by this Item 8 is contained on the pages indicated in Part IV, Item 15(a)(1) of this Annual Report on Form 10-K. Item 9. Changes in and Disagreements with Accou ntants on Accounting and Financial Disclosure. None. 67

Other VKTX 10-K year-over-year comparisons