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What changed in Amylyx Pharmaceuticals, Inc.'s 10-K — 2023 vs 2024

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

+777 added−1151 removedSource: 10-K (2025-03-04) vs 10-K (2024-02-22)

Top changes in Amylyx Pharmaceuticals, Inc.'s 2024 10-K

777 paragraphs added · 1151 removed · 542 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

102 edited+81 added−321 removed190 unchanged
Biggest changeOur earliest in time patent family relates to compositions of a bile acid and a phenylbutyrate compound (including TURSO and 4-PBA) and methods of treating neurodegenerative disease, and its associated causes at a cellular level, using those compositions.
Biggest changeThe patent families around AMX0035 include those that relate to compositions of a bile acid and a phenylbutyrate compound (including TURSO and 4-PBA) and methods of treating neurodegenerative disease, and its associated causes at a cellular level, using those compositions; specific compositions of a phenylbutyrate compound and a bile acid (including TURSO and 4-PBA) and methods of manufacturing those compositions; methods of treating particular symptoms of ALS and/or reducing the associated AEs with combinations of a phenylbutyrate compound and a bile acid (including TURSO and 4-PBA); methods of treating Alzheimer’s disease and other tauopathies (including progressive supranuclear palsy) with 7 combinations of a phenylbutyrate compound and a bile acid (including sodium phenylbutyrate and TURSO); methods of co-administering other therapeutic drugs with combinations of a phenylbutyrate compound and a bile acid (including sodium phenylbutyrate and TURSO); pharmacokinetic characteristics following the administration of TURSO and sodium phenylbutyrate; methods of reducing the level of certain biomarkers in ALS patients with combinations of sodium phenylbutyrate and TURSO; and methods of treating Wolfram Syndrome with combinations of sodium phenylbutyrate and TURSO.
HITECH also created four new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce HIPAA and seek attorneys’ fees and costs associated with pursuing federal civil actions; • the federal Physician Payments Sunshine Act, created under the ACA, and its implementing regulations, which require manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program to report annually to the Centers for Medicare and Medicaid Services, or CMS, under the Open Payments Program, information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), to certain non-physician providers such as physician assistants and nurse practitioners, and to teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members; • federal price reporting laws, which require manufacturers to calculate and report complex pricing metrics to government programs, where such reported prices may be used in the calculation of reimbursement and/or discounts on approved products; • federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; and • analogous state and foreign laws and regulations, such as state and foreign anti-kickback, false claims, consumer protection and unfair competition laws which may apply to pharmaceutical business practices, including but not limited to, research, distribution, sales and marketing arrangements as well as submitting claims involving healthcare items or services reimbursed by any third-party payor, including commercial insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government that otherwise restricts payments that may be made to healthcare providers and other potential referral sources; state laws that require drug manufacturers to file reports with states regarding pricing and marketing information, such as the tracking and reporting of gifts, compensations and other remuneration and items of value provided to healthcare professionals and entities; state and local laws requiring the registration of pharmaceutical sales representatives; and state and foreign laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.
HITECH also created four new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce HIPAA and seek attorneys’ fees and costs associated with pursuing federal civil actions; 16 • the federal Physician Payments Sunshine Act, created under the ACA, and its implementing regulations, which require manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program to report annually to the Centers for Medicare and Medicaid Services, or CMS, under the Open Payments Program, information related to payments or other transfers of value made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), to certain non-physician providers such as physician assistants and nurse practitioners, and to teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members; • federal price reporting laws, which require manufacturers to calculate and report complex pricing metrics to government programs, where such reported prices may be used in the calculation of reimbursement and/or discounts on approved products; • federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; and • analogous state and foreign laws and regulations, such as state and foreign anti-kickback, false claims, consumer protection and unfair competition laws which may apply to pharmaceutical business practices, including but not limited to, research, distribution, sales and marketing arrangements as well as submitting claims involving healthcare items or services reimbursed by any third-party payor, including commercial insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government that otherwise restricts payments that may be made to healthcare providers and other potential referral sources; state laws that require drug manufacturers to file reports with states regarding pricing and marketing information, such as the tracking and reporting of gifts, compensations and other remuneration and items of value provided to healthcare professionals and entities; state and local laws requiring the registration of pharmaceutical sales representatives; and state and foreign laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts.
Similar to the AKS, a person or entity does not need to have actual knowledge of these statutes or specific intent to violate them in order to have committed a violation. • the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created additional federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit 32 program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters.
Similar to the AKS, a person or entity does not need to have actual knowledge of these statutes or specific intent to violate them in order to have committed a violation. • the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created additional federal criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters.
Additionally, a drug may be eligible for designation as a breakthrough therapy if the product is intended, alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening condition and preliminary clinical evidence indicates that the product may demonstrate substantial improvement over currently approved therapies on one or more clinically significant endpoints.
Additionally, a drug may be eligible for designation as a breakthrough therapy if the product is intended, alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening condition and preliminary clinical 13 evidence indicates that the product may demonstrate substantial improvement over currently approved therapies on one or more clinically significant endpoints.
Even if a compound is considered to be an innovative medical product so that the innovator gains the prescribed period of data exclusivity, another company 39 nevertheless could also market another version of the product if such company obtained marketing authorization based on an MAA with a complete and independent data package of pharmaceutical tests, preclinical tests and clinical trials.
Even if a compound is considered to be an innovative medical product so that the innovator gains the prescribed period of data exclusivity, another company nevertheless could also market another version of the product if such company obtained marketing authorization based on an MAA with a complete and independent data package of pharmaceutical tests, preclinical tests and clinical trials.
NDA Submission and Marketing Approval Assuming successful completion of the required clinical testing, the results of the preclinical and clinical studies, together with detailed information relating to the product’s chemistry, manufacture, controls and proposed labeling, among other things, are submitted to the FDA as part of an NDA requesting approval to market the product for one or more 27 indications.
NDA Submission and Marketing Approval Assuming successful completion of the required clinical testing, the results of the preclinical and clinical studies, together with detailed information relating to the product’s chemistry, manufacture, controls and proposed labeling, among other things, are submitted to the FDA as part of an NDA requesting approval to market the product for one or more indications.
The conduct of preclinical studies is subject to federal regulations and requirements, including good laboratory practice regulations for safety/toxicology studies. 25 An IND sponsor must submit the results of the preclinical tests, together with manufacturing information, analytical data and any available clinical data or literature and plans for clinical studies, among other things, to the FDA as part of an IND.
The conduct of preclinical studies is subject to federal regulations and requirements, including good laboratory practice regulations for safety/toxicology studies. An IND sponsor must submit the results of the preclinical tests, together with manufacturing information, analytical data and any available clinical data or literature and plans for clinical studies, among other things, to the FDA as part of an IND.
Any authorization which is not followed by the actual placing of the medicinal product on the EU market (in case of centralized procedure) or on the market of the authorizing EU Member State (for a nationally authorized product) within three years after authorization, or if the product is removed from the market for three consecutive years, ceases to be valid (the so-called sunset clause).
Any authorization which is not followed by the actual placing of the medicinal product on the EU market (in case of centralized procedure) or on the market of the authorizing EU Member State (for a nationally 21 authorized product) within three years after authorization, or if the product is removed from the market for three consecutive years, ceases to be valid (the so-called sunset clause).
In the U.S., government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which drug products they will pay for and establish reimbursement levels. The availability and extent of reimbursement by governmental and private payors is essential for most patients to be able to afford a drug 44 product.
In the U.S., government authorities and third-party payors, such as private health insurers and health maintenance organizations, decide which drug products they will pay for and establish reimbursement levels. The availability and extent of reimbursement by governmental and private payors is essential for most patients to be able to afford a drug product.
CMS decides whether and to what extent a new drug product will be covered and reimbursed under Medicare, and private payors tend to follow CMS to a substantial degree. However, no uniform policy of coverage and reimbursement for drug products exists among third-party payors and coverage and reimbursement levels for drug products can differ significantly from payor to payor.
CMS decides whether and to what extent a new drug product will be covered and reimbursed under Medicare, and private payors tend to follow CMS to a substantial degree. However, no uniform policy of coverage and reimbursement for drug products exists among third-party payors and coverage and reimbursement levels for drug products 24 can differ significantly from payor to payor.
Outside of the U.S., the pricing of pharmaceutical products is subject to governmental control in many countries. For example, in the EU, pricing and reimbursement schemes vary widely from country to country. Some countries provide that products may be marketed only after a reimbursement price has been agreed.
Outside of the U.S., the pricing of pharmaceutical products is subject to governmental control in many countries. For example, in the EU, pricing and reimbursement schemes vary widely from country to country. Some countries provide that 25 products may be marketed only after a reimbursement price has been agreed.
If a concerned EU Member State cannot approve the assessment report and related materials due to concerns relating to a potential serious risk to public health, disputed elements may be referred to the European Commission, whose decision is binding on all EU Member States.
If a concerned EU Member State cannot approve the assessment report and related materials due to 20 concerns relating to a potential serious risk to public health, disputed elements may be referred to the European Commission, whose decision is binding on all EU Member States.
The sponsor must submit an IND safety report within 15 calendar days after the sponsor determines that the information qualifies for reporting. The sponsor also must notify the FDA of any unexpected 26 fatal or life-threatening suspected adverse reaction within seven calendar days after the sponsor’s initial receipt of the information.
The sponsor must submit an IND safety report within 15 calendar days after the sponsor determines that the information qualifies for reporting. The sponsor also must notify the FDA of any unexpected fatal or life-threatening suspected adverse reaction within seven calendar days after the sponsor’s initial receipt of the information.
Rest of the World Regulation For other countries outside of Canada, the EU and the U.S., such as countries in the Middle East, Africa, Latin America or Asia, the requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country.
Rest of the World Regulation For other countries outside of the EU and the U.S., such as countries in the Middle East, Africa, Latin America or Asia, the requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country.
Government payment for 45 some of the costs of prescription drugs may increase demand for drugs for which we obtain marketing approval. Any negotiated prices for any of our products covered by a Part D prescription drug plan will likely be lower than the prices we might otherwise obtain.
Government payment for some of the costs of prescription drugs may increase demand for drugs for which we obtain marketing approval. Any negotiated prices for any of our products covered by a Part D prescription drug plan will likely be lower than the prices we might otherwise obtain.
We make available, free of charge, in the Investors section of our website, documents we file with or furnish to the SEC, including our Annual Reports on Form 10-K, Quarterly Reports on 46 Form 10-Q, Current Reports on Form 8-K and any exhibits and amendments to those reports.
We make available, free of charge, in the Investors section of our website, documents we file with or furnish to the SEC, including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any exhibits and amendments to those reports.
In addition, our trade secrets may otherwise become known or independently discovered by competitors. Our commercial success also depends in part on our ability to operate without infringing on the proprietary rights of others and to prevent others from infringing our proprietary rights.
In addition, our trade secrets may otherwise become known or independently discovered by competitors. Our potential commercial success also depends in part on our ability to operate without infringing on the proprietary rights of others and to prevent others from infringing our proprietary rights.
The American Taxpayer Relief Act of 2012 further reduced Medicare payments to several providers, including hospitals and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.
Also, the American Taxpayer Relief Act of 2012 further reduced Medicare payments to several providers, including hospitals and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.
If and when those conditions have been met to the FDA’s satisfaction, the FDA will typically issue an approval letter. An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications.
If and when those conditions have been met to the FDA’s satisfaction, the FDA will typically issue an 12 approval letter. An approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications.
Pediatric exclusivity, if granted, adds six months to existing regulatory exclusivity periods for all formulations, dosage forms, and indications of the active moiety and patent terms.
Pediatric exclusivity, if granted, adds six months to existing regulatory exclusivity periods for all formulations, dosage forms, and indications of the active 14 moiety and patent terms.
A single UK-wide marketing authorization will be granted by the MHRA for all medicinal products to be sold in the UK, enabling products to be sold in a single pack and under a single authorization throughout the UK.
A single UK-wide marketing authorization will be granted by the MHRA for all novel medicinal products to be sold in the UK, enabling products to be sold in a single pack and under a single authorization throughout the UK.
Following the approval of RELYVRIO in the U.S., we have applied for patent term extensions for certain of our issued U.S. patents covering our product and/or their methods of use. We also rely on trademarks, trade secrets, know-how, continuing technological innovation, confidentiality agreements, and invention assignment agreements to develop and maintain our proprietary position.
Following the approval of RELYVRIO in the U.S., we applied for patent term extensions for certain of our issued U.S. patents covering our product candidates and/or their methods of use. We also rely on trademarks, trade secrets, know-how, continuing technological innovation, confidentiality agreements, and invention assignment agreements to develop and maintain our proprietary position.
These laws and regulations may result in additional reductions in Medicare and other healthcare funding and otherwise affect the prices we may obtain for any of our product candidates for which we may obtain regulatory approval or the frequency with which any such product candidate is prescribed or used.
These laws and regulations may result in additional reductions in Medicare and other healthcare funding available for healthcare providers and may otherwise affect the prices we may obtain for any of our product candidates for which we may obtain regulatory approval or the frequency with which any such product candidate is prescribed or used.
Clinical Trials Clinical trials involve the administration of the investigational new drug to human subjects under the supervision of qualified investigators in accordance with cGCP requirements, which include the requirement that all research subjects provide their informed consent in writing for their participation in any clinical trial.
Clinical Trials Clinical trials involve the administration of the investigational new drug to human subjects under the supervision of qualified investigators in accordance with GCP requirements, which include the requirement that all research subjects provide their informed consent in writing for their participation in any clinical trial.
During the period of market exclusivity, a marketing authorization may only be granted for a “similar medicinal product” with the same orphan indication if: (i) the marketing authorization holder for the original orphan medicinal product consents to the authorization of the second orphan medicinal product; (ii) the manufacturer of the original orphan medicinal product is unable to supply sufficient quantities of the product; or (iii) it is established that the second product is safer, more effective or otherwise clinically superior to the original orphan medicinal product.
During the period of market exclusivity, a marketing authorization may only be granted for a “similar medicinal product” with the same orphan indication as an authorized orphan medicinal product if: (i) the marketing authorization holder for the original orphan medicinal product consents to the authorization of the second medicinal product; (ii) the manufacturer of the original orphan medicinal product is unable to supply sufficient quantities of the product; or (iii) it is established that the second product is safer, more effective or otherwise clinically superior to the original orphan medicinal product.
Written IND safety reports must be submitted to the FDA and investigators for serious and unexpected suspected adverse events, findings from other studies or animal or in vitro testing that suggest a significant risk for human subjects and any clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or investigator brochure.
Written IND safety reports must be submitted to the FDA and investigators for serious and unexpected suspected AEs, findings from other studies or animal or in vitro testing that suggest a significant risk for human 10 subjects and any clinically important increase in the rate of a serious suspected adverse reaction over that listed in the protocol or investigator brochure.
Should an orphan designation be granted, the period of market exclusivity will be set from the date of first approval of the product in Great Britain. Pricing Decisions for Approved Products In the EU, pricing and reimbursement schemes vary widely from country to country. Some countries provide that products may be marketed only after a reimbursement price has been agreed.
Should an orphan designation be granted, the period of market exclusivity will be set from the date of first approval of the product in the UK. Pricing Decisions for Approved Products In the EU, pricing and reimbursement schemes vary widely from country to country. Some countries provide that products may be marketed only after a reimbursement price has been agreed.
The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability. Other U.S.
The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability.
The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required 28 specifications. Additionally, before approving an NDA, the FDA may inspect one or more clinical trial sites to assure compliance with cGCP requirements.
The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA, the FDA may inspect one or more clinical trial sites to assure compliance with GCP requirements.
These requirements include compliance with EU cGMP standards when manufacturing medicinal products and active pharmaceutical ingredients, including the manufacture of 40 active pharmaceutical ingredients outside of the EU with the intention to import the active pharmaceutical ingredients into the EU. • The marketing and promotion of authorized medicinal products, including industry-sponsored continuing medical education and advertising directed toward the prescribers of medicinal products and/or the general public, are strictly regulated in the EU notably under Directive 2001/83EC, as amended, and are also subject to EU Member State national laws.
These requirements include compliance with EU cGMP standards when manufacturing medicinal products and active pharmaceutical ingredients, including the manufacture of active pharmaceutical ingredients outside of the EU with the intention to import the active pharmaceutical ingredients into the EU. • The marketing and promotion of authorized medicinal products, including industry-sponsored continuing medical education and advertising directed toward the prescribers of medicinal products and/or the general public, are strictly regulated in the EU notably under Directive 2001/83/EC83EC, as amended, and are also subject to EU Member State national laws.
An IND is a request for authorization from the FDA to administer an investigational product to humans and must become effective before human clinical trials may begin. Some preclinical testing, such as animal tests of reproductive adverse events and carcinogenicity, may continue even after the IND is submitted.
An IND is a request for authorization from the FDA to administer an investigational product to humans and must become effective before human clinical trials may begin. Some preclinical testing, such as animal tests of reproductive AEs and carcinogenicity, may continue even after the IND is submitted.
Accordingly, this review process typically takes 12 months and eight months, respectively from the date the NDA is submitted to the FDA. The FDA does not always meet its PDUFA goal dates for standard or priority NDAs, and the review process is often extended by FDA requests for additional information or clarification.
Accordingly, this review process typically takes 12 months and 8 months, respectively from the date the NDA is submitted to the FDA. The FDA does not always meet its PDUFA goal dates for standard or priority NDAs, and the review process is often extended by FDA requests for additional information or 11 clarification.
Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in mandatory revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical trials to assess new safety risks; or imposition of distribution 31 or other restrictions under a REMS program.
Later discovery of previously unknown problems with a product, including AEs of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in mandatory revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical trials to assess new safety risks; or imposition of distribution or other restrictions under a REMS program.
Non-Patent Exclusivity Data exclusivity provisions under the FDCA can delay the submission or the approval of certain follow-on applications. The FDCA provides a five-year period of data exclusivity within the U.S. to the first applicant to gain approval of an NDA for an NCE.
Non-Patent Exclusivity Data exclusivity provisions under the FDCA can delay the submission or the approval of certain follow-on applications. The FDCA provides a five-year period of data exclusivity within the U.S. to the first applicant to gain approval of an NDA for a new chemical entity, or NCE.
Consequently, marketing authorization under exceptional circumstances may be granted subject to certain specific obligations, which may include the following: • the applicant must complete an identified program of studies within a time period specified by the competent authority, the results of which form the basis of a reassessment of the benefit/risk profile; • the medicinal product in question may be supplied on medical prescription only and may in certain cases be administered only under strict medical supervision, possibly in a hospital and in the case of a radiopharmaceutical, by an authorized person; and • the package leaflet and any medical information must draw the attention of the medical practitioner to the fact that the particulars available concerning the medicinal product in question are as yet inadequate in certain specified respects. 38 A marketing authorization under exceptional circumstances is subject to annual review to reassess the risk-benefit balance in an annual reassessment procedure.
Consequently, marketing authorization under exceptional circumstances may be granted subject to certain specific obligations, which may include the following: • the applicant must complete an identified program of studies within a time period specified by the competent authority, the results of which form the basis of a reassessment of the benefit/risk profile; • the medicinal product in question may be supplied on medical prescription only and may in certain cases be administered only under strict medical supervision, possibly in a hospital and in the case of a radiopharmaceutical, by an authorized person; and • the package leaflet and any medical information must draw the attention of the medical practitioner to the fact that the particulars available concerning the medicinal product in question are as yet inadequate in certain specified respects.
Other countries may allow companies to fix their own prices for products, but monitor and control product volumes and issue guidance to physicians to limit prescriptions. Efforts to control prices and utilization of pharmaceutical products will likely continue as countries attempt to manage healthcare expenditures. Employees and Human Capital As of December 31, 2023, we had 384 full-time employees.
Other countries may allow companies to fix their own prices for products, but monitor and control product volumes and issue guidance to physicians to limit prescriptions. Efforts to control prices and utilization of pharmaceutical products will likely continue as countries attempt to manage healthcare expenditures. Employees and Human Capital As of December 31, 2024, we had 123 full-time employees.
Supply and Manufacturing We rely, and expect to continue to rely for the foreseeable future, on third-party contract manufacturing organizations, or CMOs, for the production of AMX0035 and AMX0114 in compliance with current Good Manufacturing Process, or cGMP, requirements, for commercial supply as well as for use in clinical trials under the guidance of members of our organization.
Supply and Manufacturing We rely, and expect to continue to rely for the foreseeable future, on third-party contract manufacturing organizations, or CMOs, for the production of avexitide, AMX0035 and AMX0114 in compliance with current Good Manufacturing Process, or cGMP, requirements, for use in clinical trials under the guidance of members of our organization.
While the CCPA, as modified by the CPRA contain an exception for certain activities involving PHI under HIPAA, we cannot yet determine the impact the CCPA, CPRA or other such future laws, regulations and standards may have on our business, as these laws either do not yet apply to us or are not yet in effect.
While the CCPA contains an exception for certain activities involving PHI under HIPAA, we cannot yet determine the impact the CCPA or other such future laws, regulations and standards may have on our business, as these laws either do not yet apply to us or are not yet in effect.
The process required by the FDA before a drug may be marketed in the U.S. generally involves the following: • Completion of preclinical laboratory tests, animal studies and formulation studies in compliance with the FDA’s good laboratory practice, or GLP, regulations; • Submission to the FDA of an IND, which must become effective before human clinical trials may begin; • Approval by an independent institutional review board, or IRB, at each clinical site before each trial may be initiated; • Performance of adequate and well-controlled human clinical trials in accordance with current Good Clinical Practices, or cGCP, requirements to establish the safety and efficacy of the proposed drug product for each indication; • Submission to the FDA of an NDA, including payment of application user fees; • A determination by the FDA within 60 days of its receipt of an NDA to accept the marketing application for review; • Satisfactory completion of an FDA advisory committee review, if applicable; • Satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with current Good Manufacturing Practice, or cGMP, requirements and to assure that the facilities, methods and controls are adequate to preserve the product’s identity, strength, quality and purity; • Satisfactory completion of FDA audits of clinical trial sites to assure compliance with cGCPs and the integrity of the clinical data; and • FDA review and approval of the NDA.
The process required by the FDA before a drug may be marketed in the U.S. generally involves the following: • Completion of preclinical laboratory tests, animal studies and formulation studies in compliance with the FDA’s good laboratory practice, or GLP, regulations; • Submission to the FDA of an IND, which must become effective before human clinical trials may begin; • Approval by an independent institutional review board, or IRB, at each clinical site before each trial may be initiated; • Performance of adequate and well-controlled human clinical trials in accordance with Good Clinical Practices, or GCP, requirements to establish the safety and efficacy of the proposed drug product for each indication; • Submission to the FDA of an NDA, including payment of application user fees; • A determination by the FDA within 60 days of its receipt of a new drug application, or an NDA to accept the marketing application for review; • Satisfactory completion of an FDA advisory committee review, if applicable; • Satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with cGMP, requirements and to assure that the facilities, methods and controls are adequate to preserve the product’s identity, strength, quality and purity; • Satisfactory completion of FDA audits of clinical trial sites to assure compliance with GCPs and the integrity of the clinical data; and • FDA review and approval of the NDA. 9 Preclinical Studies Preclinical studies include laboratory evaluation of product chemistry, toxicity and formulation, as well as in vitro and animal studies to assess potential safety and efficacy.
As part of our governance practices, we are committed to high standards of ethics, which are reflected in our Code of Business Conduct and Ethics, which applies to our directors, officers, employees and designated agents. This Code is posted on our corporate website. We have an independent chairman, and four of our six board members are independent.
As part of our governance practices, we are committed to high standards of ethics, which are reflected in our Code of Business Conduct and Ethics, which applies to our directors, officers, employees and designated agents. This Code is posted on our corporate 27 website. We have an independent chairman, and five of our seven board members are independent.
Progress reports detailing the results of the clinical trials must be submitted at least annually to the FDA and more frequently if SAEs occur.
Progress reports detailing the results of the clinical trials must be submitted at least annually to the FDA and more frequently if suspected AEs occur.
Our Audit, Nominating and Corporate Governance, and Compensation Committees are comprised solely of independent directors. 48
Our Audit, Nominating and Corporate Governance, and Compensation Committees are comprised solely of independent directors. 28
In addition, other legislative changes have been proposed and adopted in the U.S. since the ACA was enacted. The Budget Control Act of 2011 and subsequence legislation, among other things, created measures for spending reductions by Congress that include aggregate reductions of Medicare payments to providers of 2% per fiscal year, which remain in effect through 2031.
Other legislative changes have been proposed and adopted since the ACA was enacted. For example. the Budget Control Act of 2011 and subsequent legislation, among other things, created measures for spending reductions that include aggregate reductions of Medicare payments to providers of 2% per fiscal year, which remain in effect through 2031.
Products that are granted a marketing authorization with the results of the pediatric clinical trials conducted in accordance with the PIP (even where such results are negative) are eligible for six months’ supplementary protection certificate, or SPC, extension (provided an application for such extension is made at the same time as filing the SPC application for the product, or at any point up to 2 years before the SPC expires).
Products that are granted a marketing authorization with the results of the pediatric clinical trials conducted in accordance with the PIP (even where such results are negative) are eligible for six months’ supplementary protection certificate, or SPC, extension (provided an application for such extension is made at the same time as filing the SPC application for the product, or at any point up to 2 years before the SPC expires). 19 The centralized procedure provides for the grant of a single marketing authorization by the European Commission that is valid across the EEA.
Thus, a marketing authorization under exceptional circumstances is granted for an initial five years, after which the authorization will become valid indefinitely, unless the EMA decides that safety grounds merit one additional five-year renewal.
The renewal of a marketing authorization of a medicinal product under exceptional circumstances, however, follows the same rules as a “normal” marketing authorization. Thus, a marketing authorization under exceptional circumstances is granted for an initial five years, after which the authorization will become valid indefinitely, unless the EMA decides that safety grounds merit one additional five-year renewal.
Recently, many countries in the EU have increased the amount of discounts required on pharmaceuticals and these efforts could continue as countries attempt to manage health care expenditures, especially in light of the severe fiscal and debt crises experienced by many countries in the EU. The downward pressure on health care costs in general, particularly prescription products, has become intense.
Recently, many countries in the EU have increased the amount of discounts required on pharmaceuticals and these efforts could continue as countries attempt to manage health care expenditures, especially in light of the severe fiscal and debt crises experienced by many countries in the EU.
Strict deadlines have been established for the assessment of clinical trial applications. PRIME Designation in the EU In March 2016, the EMA launched an initiative to facilitate development of product candidates in indications, often rare, for which few or no therapies currently exist.
PRIME Designation in the EU In March 2016, the EMA launched an initiative to facilitate development of product candidates in indications, often rare, for which few or no therapies currently exist.
A written decision has been issued; however Bruschettini has appealed the decision of the Opposition Division to the Board of Appeal. A response to Bruschettini’s appeal has been filed on June 7, 2022 requesting that the appeal should be dismissed and that the decision of the Opposition Division to revoke all claims of EP3016654 be upheld.
A response to Bruschettini’s appeal has been filed on June 7, 2022 requesting that the appeal should be dismissed and that the decision of the Opposition Division to revoke all claims of EP3016654 be upheld. The Board of Appeal issued a summons to attend oral proceedings on May 24, 2023.
These programs include Fast Track Designation, Breakthrough Therapy Designation, Priority Review Designation and accelerated approval, and the purpose of these programs is to either expedite the development or review of important new drugs to get them to patients earlier than under standard FDA development and review procedures. 29 The FDA has a FastTrack program that is intended to expedite or facilitate the process for reviewing new drugs that meet certain criteria.
These programs include Fast Track Designation, Breakthrough Therapy Designation, Priority Review Designation and accelerated approval, and the purpose of these programs is to either expedite the development or review of important new drugs to get them to patients earlier than under standard FDA development and review procedures.
The sponsor can request the FDA to designate the product for Fast Track status any time before receiving NDA approval, but ideally no later than the pre-NDA meeting.
Fast Track Designation applies to both the product and the specific indication for which it is being studied. The sponsor can request the FDA to designate the product for Fast Track status any time before receiving NDA approval, but ideally no later than the pre-NDA meeting.
We believe that the key competitive factors affecting the success of any of our product candidates will include efficacy, safety profile, dosing, cost, effectiveness of promotional support and intellectual property protection.
Any product candidates that we successfully develop and commercialize may compete with current therapies and new therapies that may become available in the future. We believe that the key competitive factors affecting the success of any of our product candidates will include efficacy, safety profile, dosing, cost, effectiveness of promotional support and intellectual property protection.
The American Rescue Plan Act of 2021 eliminates the statutory Medicaid drug rebate cap, currently set at 100% of a drug’s average manufacturer price, for single source and innovator multiple source drugs, beginning January 1, 2024.
In addition to provider payment cuts under Medicare, the American Rescue Plan Act of 2021 also eliminated the statutory Medicaid drug rebate cap, previously set at 100% of a drug’s average manufacturer price, for single source innovator multiple source drugs, beginning January 1, 2024.
Compliance with the GDPR will be a rigorous and time-intensive process that may increase the cost of doing business or require companies to change their business practices to ensure full compliance.
Compliance with the GDPR will be a rigorous and time-intensive process that may increase the cost of doing business or require companies to change their business practices to ensure full compliance. Brexit and the Regulatory Framework in the United Kingdom The UK formally left the EU on January 31, 2020.
In particular, the MHRA will be responsible for approving all medicinal products 41 destined for the UK market (i.e., Great Britain and Northern Ireland), and the EMA will no longer have any role in approving medicinal products destined for Northern Ireland.
The MHRA is now responsible for approving all medicinal products destined for the UK market (i.e., Great Britain and Northern Ireland) and the EMA no longer has any role in approving medicinal products destined for Northern Ireland under the EU centralized procedure.
Environmental, Social, and Governance (ESG) The values that drive our mission to one day end the suffering caused by neurodegenerative diseases are at the heart of how we do business. Our commitment to audacity, curiosity, engagement, accountability, and authenticity compels us to be responsible members of the global community.
Environmental, Social, and Governance (ESG) The values that drive our mission to develop novel therapies for communities with high unmet needs are at the heart of how we do business. Our commitment to audacity, curiosity, engagement, accountability, and authenticity compels us to be responsible members of the global community.
Phase 1, Phase 2 and Phase 3 trials may not be completed successfully within any specified period, or at all. Furthermore, the FDA or the sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects are being exposed to an unacceptable health risk.
The FDA or the sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects are being exposed to an unacceptable health risk.
FDA regulations also require investigation and correction of any deviations from cGMP requirements and impose reporting and documentation requirements upon the sponsor and any third-party manufacturers that the sponsor may decide to use. Accordingly, manufacturers must continue to expend time, money, and effort in the area of production and quality control to maintain cGMP compliance.
FDA regulations also require investigation and correction of any deviations from cGMP requirements and impose reporting and documentation requirements upon the sponsor and any third-party manufacturers that the sponsor may decide to use.
In situations when it has been established that monotherapy will not be adequate, appropriate or ethical to reach the desired therapeutic effect, initial use of combination therapy should be easily justified (e.g., HIV). 37 Marketing Authorization To obtain a marketing authorization for a product in the European Economic Area (i.e., the EU as well as Iceland, Liechtenstein and Norway), or EEA, an applicant must submit an MAA either under a centralized procedure administered by the EMA, or one of the procedures administered by competent authorities in the EU Member States (decentralized procedure, national procedure or mutual recognition procedure).
Marketing Authorization To obtain a marketing authorization for a product in the European Economic Area (i.e., the EU as well as Iceland, Liechtenstein and Norway), or EEA, an applicant must submit an MAA either under a centralized procedure administered by the EMA, or one of the procedures administered by competent authorities in the EU Member States (decentralized procedure, national procedure or mutual recognition procedure).
Due to the Statutory Pay-As-You-Go Act of 2010, estimated budget deficit increases resulting from the American Rescue Plan Act of 2021, and subsequent legislation, Medicare payments to providers will be further reduced starting in 2025 absent further legislation.
Due to the Statutory Pay-As-You-Go Act of 2010, estimated budget deficit increases resulting from the American Rescue Plan Act of 2021, and subsequent legislation, Medicare payments to providers were further reduced starting on January 1, 2025; however, legislation has been introduced in the U.S. Congress that would reverse these payment reductions.
As an employer, diversity is also important, including having representation of diverse views and backgrounds at the highest levels of the organization. Three of our seven senior executives are women. Our board is committed to increasing diversity as we add additional members over time. At present, of our six board members, two are women, one who is ethnically diverse.
As an employer, diversity is also important, including having representation of diverse views and backgrounds at the highest levels of the organization. Three of our eight senior executives are women, and two of our seven board members are women. We care deeply about supporting and investing in our people.
Specifically, new drugs are eligible for Fast Track Designation if they are intended to treat a serious or life threatening condition and preclinical or clinical data demonstrate the potential to address unmet medical needs for the condition. Fast Track Designation applies to both the product and the specific indication for which it is being studied.
The FDA has a FastTrack program that is intended to expedite or facilitate the process for reviewing new drugs that meet certain criteria. Specifically, new drugs are eligible for Fast Track Designation if they are intended to treat a serious or life threatening condition and preclinical or clinical data demonstrate the potential to address unmet medical needs for the condition.
There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any products, if approved in those countries.
Reference pricing used by various EU Member States, and parallel trade, i.e., arbitrage between low-priced and high-priced EU Member States, can further reduce prices. There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any products, if approved in those countries.
Although no patents have yet issued from this family, we expect the term on patents issuing from this family to extend until at least May 2043. We cannot be sure that patents will be granted with respect to any of our pending patent applications nor with respect to any patent applications that may be filed by us in the future.
We cannot be sure that patents will be granted with respect to any of our pending patent applications nor with respect to any patent applications that may be filed by us in the future.
Continuation of the authorization is linked to the annual reassessment and a negative assessment could potentially result in the marketing authorization being suspended or revoked. The renewal of a marketing authorization of a medicinal product under exceptional circumstances, however, follows the same rules as a “normal” marketing authorization.
A marketing authorization under exceptional circumstances is subject to annual review to reassess the risk-benefit balance in an annual reassessment procedure. Continuation of the authorization is linked to the annual reassessment and a negative assessment could potentially result in the marketing authorization being suspended or revoked.
In October 2014, however, the FDA reversed that position when it issued final guidance stating that an application for a fixed-dose combination product will be eligible for 5-year NCE exclusivity if it contains a drug substance with a single, new active moiety, even if the fixed-combination also contains a drug substance with a previously approved active moiety. 30 The FDCA also provides three years of market exclusivity for an NDA, 505(b)(2) NDA or supplement to an existing NDA if new clinical investigations, other than bioavailability studies, that were conducted or sponsored by the applicant are deemed by the FDA to be essential to the approval of the application, for example, new indications, dosages or strengths of an existing drug.
The FDCA also provides three years of market exclusivity for an NDA, 505(b)(2) NDA or supplement to an existing NDA if new clinical investigations, other than bioavailability studies, that were conducted or sponsored by the applicant are deemed by the FDA to be essential to the approval of the application, for example, new indications, dosages or strengths of an existing drug.
The criteria are essentially the same, but have been tailored for the Great Britain market, i.e., the prevalence of the condition in Great Britain (rather than the EU) must not be more than five in 10,000.
There is now no pre-marketing authorization orphan designation in the UK. Instead, the MHRA reviews applications for orphan designation in parallel to the corresponding MAA. The criteria are essentially the same, but have been tailored for the UK market, i.e., the prevalence of the condition in the UK (rather than the EU) must not be more than five in 10,000.
Our filings with the SEC are available on the SEC’s website at www.sec.gov. We also maintain a website at http://www.amylyx.com.
Available Information We file Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and other information with the SEC. Our filings with the SEC are available on the SEC’s website at www.sec.gov. We also maintain a website at http://www.amylyx.com.
The FDA may refer an application for a novel drug or a drug that presents difficult questions of safety or efficacy to an advisory committee. An advisory committee is a panel of independent experts, including clinicians and other scientific experts, which reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions.
An advisory committee is a panel of independent experts, including clinicians and other scientific experts, which reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.
Our commercial success depends in part on our ability to obtain intellectual property that protects AMX0035 and its uses, and any future product 22 candidates. We seek to protect and enhance proprietary technology, inventions and improvements that are commercially important to the development of our business and AMX0035, in particular, by seeking, maintaining and defending U.S. and foreign patent rights.
We seek to protect and enhance proprietary technology, inventions and improvements that are commercially important to the development of our business by seeking, maintaining and defending U.S. and foreign patent rights. We are actively building our intellectual property portfolio in our therapeutic areas, including around avexitide, AMX0035, and AMX0114.
We also have a Quality Management System consistent with a regulated industry that outlines Standard Operating Policies and Procedures that govern the oversight of our CMOs.
This team has significant technical, manufacturing, analytical, quality, regulatory, including cGMP, and project management experience to oversee our third-party manufacturers and maintain quality and regulatory compliance. We also have a Quality Management System consistent with a regulated industry that outlines Standard Operating Policies and Procedures that govern the oversight of our CMOs.
The law, among other things, provides a federal framework for certain patients to access certain investigational products that have completed a Phase 1 clinical trial and that are undergoing investigation for FDA approval. Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA permission under FDA expanded access program.
In addition, on May 30, 2018, the Right to Try Act was signed into law. The law, among other things, provides a federal framework for certain patients to access certain investigational products that have completed a Phase 1 clinical trial and that are undergoing investigation for FDA approval.
There is no obligation for a manufacturer to make its investigational products available to eligible patients as a result of the Right to Try Act.
Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA permission under the FDA expanded access program. There is no obligation for a manufacturer to make its investigational products available to eligible patients as a result of the Right to Try Act.
In addition, commercialization of any drug product outside the U.S. will also likely be subject to foreign equivalents of the healthcare laws mentioned above, among other foreign laws. 33 In the U.S., numerous federal and state laws and regulations, including state data breach notification laws, state and federal health information privacy laws, and federal and state consumer protection laws, govern the collection, use, disclosure, and protection of health-related and other personal information.
In addition, commercialization of any drug product outside the U.S. will also likely be subject to foreign equivalents of the healthcare laws mentioned above, among other foreign laws.
The EPO issued a preliminary opinion on November 18, 2019 finding that at least the main claim of EP3016654 lacked novelty. Oral proceedings were held before an Opposition Division of the EPO on June 11, 2021. At the 24 end of the oral proceedings, the Opposition Division announced the decision revoking all claims of EP3016654.
Oral proceedings were held before an Opposition Division of the EPO on June 11, 2021. At the end of the oral proceedings, the Opposition Division announced the decision revoking all claims of EP3016654. A written decision has been issued; however Bruschettini has appealed the decision of the Opposition Division to the Board of Appeal.
Once the European Commission’s legislative proposals are approved (with or without amendment), they will be adopted into EU law.
The European Commission has provided the legislative proposals to the European Parliament and the European Council for their review and 22 approval and in April 2024, the European Parliament proposed amendments to the legislative proposals. Once the European Commission’s legislative proposals are approved (with or without amendment), they will be adopted into EU law.
U.S. lawmakers have also recently raised the possibility that regulatory or legislative changes might need to be made to the Orphan Drug Act to foster competition. This includes the introduction of legislation that, if adopted into law, would require us to demonstrate to the FDA that AMX0035 would be economically unviable when facing competition to maintain our exclusivity.
U.S. lawmakers have also recently raised the possibility that regulatory or legislative changes might need to be made to the Orphan Drug Act to foster competition.
PREA does not apply to a drug for an indication for which orphan drug designation has been granted. The FDA conducts a preliminary review of all NDAs within the first 60 days after submission, before accepting them for filing, to determine whether they are sufficiently complete to permit substantive review.
The FDA conducts a preliminary review of all NDAs within the first 60 days after submission, before accepting them for filing, to determine whether they are sufficiently complete to permit substantive review. The FDA may request additional information rather than accept an NDA for filing. In this event, the application must be resubmitted with the additional information.
There is no obligation for a sponsor to make its drug products available for expanded access; however, as required by the 21st Century Cures Act, or Cures Act, passed in 2016, if a sponsor has a policy regarding how it responds to expanded access requests, it must make that policy publicly available.
There is no obligation for a sponsor to make its drug products available for expanded access; however, as required by the 21st Century Cures Act, or Cures Act, passed in 2016, a sponsor must make its expanded access policy publicly available upon the earlier of initiation of a Phase 2 or Phase 3 trial; or 15 days after the investigational drug or biologic receives fast track, breakthrough or regenerative medicine advanced therapy designation.
As a result, increasingly high barriers are being erected to the entry of new products. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained. Reference pricing used by various EU Member States, and parallel trade, i.e., arbitrage between low-priced and high-priced EU Member States, can further reduce prices.
The downward pressure on health care costs in general, particularly prescription products, has become intense. 23 As a result, increasingly high barriers are being erected to the entry of new products. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained.
However, notwithstanding that there is no wholesale recognition of EU pharmaceutical legislation under the TCA, under a new framework mentioned below which will be put in place by the MHRA, the UK’s medicines regulator, from January 1, 2024, the MHRA has stated that it will take into account decisions on the approval of marketing authorization from the EMA (and certain other regulators) when considering an application for a Great Britain marketing authorization.
However, although a separate authorization is now required to market medicinal products in the UK, under an international recognition procedure which was put in place by the MHRA on January 1, 2024, the MHRA may take into account decisions on the approval of a marketing authorization from the EMA (and certain other regulators) when considering an application for a UK marketing authorization.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIf we are unable to continue to successfully commercialize AMX0035 or any other current or future product candidates in the U.S., Canada or elsewhere, if and when approved, we may be unable to generate meaningful additional product revenue. • AMX0035 may fail to maintain the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for continued commercial success or to remain profitable. • If the FDA, Health Canada, the EMA or other comparable foreign regulatory authorities approve generic versions of AMX0035 or any other current or future product candidate of ours that receives regulatory approval, or such authorities do not grant our products appropriate periods of non-patent exclusivity before approving generic versions of such products, the sales of such products could be adversely affected. • If we fail to obtain coverage and reimbursement for AMX0035 or any other current or future product candidates in new geographies, it could make it difficult for us to sell AMX0035 or any other current or future product candidates profitably.
Biggest changeIf they do not perform satisfactorily, we may not be able to obtain regulatory approval or successfully commercialize avexitide, AMX0035 or any other current or future product candidates, or such approval or commercialization may be delayed, and our business could be substantially harmed. • We may seek to establish additional collaborations and if we are not able to establish and maintain them on commercially reasonable terms, we may have to alter our development and future commercialization plans. • We have entered and may in the future enter into collaborations with third parties for the development and commercialization of avexitide, AMX0035 or any other current or future product candidates, and our prospects with respect to avexitide, AMX0035 and our other current or future product candidates will depend in significant part on the success of those collaborations. 29 Risks Related to Commercialization of Avexitide, AMX0035 or Future Product Candidates • The markets for avexitide for PBH, and congenital HI, for AMX0035 for Wolfram syndrome, PSP and other neurodegenerative diseases, and for any other product candidates we are currently developing or may in the future develop or acquire may be smaller than we expect. • If we are unable in the future to expand our sales, marketing, manufacturing and distribution capabilities or enter into agreements with third parties to market and sell avexitide, AMX0035 or other current or future product candidates for which we obtain marketing approval, we will be unable to generate any additional product revenue. • Even if any current or future product candidate of ours receives regulatory approval, it may fail to maintain the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for continued commercial success or to remain profitable.
In addition, other unanticipated costs may arise in the course of our development and commercialization efforts. Because the design and outcome of our ongoing and anticipated clinical trials is highly uncertain, we cannot reasonably estimate the actual amounts necessary to successfully complete the development and commercialization of any product candidate we develop.
In addition, other unanticipated costs may arise in the course of our development efforts. Because the design and outcome of our ongoing and anticipated clinical trials is highly uncertain, we cannot reasonably estimate the actual amounts necessary to successfully complete the development and commercialization of any product candidate we develop.
In the event that an alternative combination, or TURSO as a single drug product, is developed and approved for use in indications for which we may seek approval and falls outside the scope of our patent claims, the marketability and commercial success of AMX0035 could be materially harmed.
In the event that an alternative combination of AMX0035, or TURSO as a single drug product, is developed and approved for use in indications for which we may seek approval and falls outside the scope of our patent claims, the marketability and commercial success of AMX0035 could be materially harmed.
Among other things, our certificate of incorporation and bylaws: • permit our board of directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate (including the right to approve an acquisition or other change in our control); • provide that the authorized number of directors may be changed only by resolution of the board of directors; • provide that our board of directors or any individual director may only be removed with cause and the affirmative vote of the holders of at least 66-2/3% of the voting power of all of our then-outstanding common stock; • provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; • divide our board of directors into three classes; • require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent; • provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner and also specify requirements as to the form and content of a stockholder’s notice; • do not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose); • provide that special meetings of our stockholders may be called only by the board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors; and • provide that the Court of Chancery of the State of Delaware is the sole and exclusive forum for the following types of actions or proceedings under state, statutory and common law: (i) any derivative action or proceeding brought on our behalf; (ii) any action or proceeding asserting a claim of breach of a fiduciary duty owed by any of our current or former directors, officers or other employees to us or our stockholders; (iii) any action or proceeding asserting a claim against us or any of our current or former directors, officers or other employees, arising out of or pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws; (iv) any action or proceeding to interpret, apply, enforce or determine the validity of our certificate of incorporation or our bylaws; (v) any action or proceeding as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and (vi) any action asserting a claim against us or any of our directors, officers or other employees governed by the internal affairs doctrine, in all cases to the fullest extent permitted by law and subject to the court’s having personal jurisdiction over the indispensable parties named as defendants; provided these provisions of our certificate of incorporation and bylaws will not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction; and provided that, unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the U.S. shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, or the Securities Act.
Among other things, our certificate of incorporation and bylaws: • permit our board of directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate (including the right to approve an acquisition or other change in our control); • provide that the authorized number of directors may be changed only by resolution of the board of directors; • provide that our board of directors or any individual director may only be removed with cause and the affirmative vote of the holders of at least 66-2/3% of the voting power of all of our then-outstanding common stock; • provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; • divide our board of directors into three classes; • require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent; • provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner and also specify requirements as to the form and content of a stockholder’s notice; • do not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election, if they should so choose); • provide that special meetings of our stockholders may be called only by the board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors; and • provide that the Court of Chancery of the State of Delaware is the sole and exclusive forum for the following types of actions or proceedings under state, statutory and common law: (i) any derivative action or proceeding brought on our behalf; (ii) any action or proceeding asserting a claim of breach of a fiduciary duty owed by any of our current or former directors, officers or other employees to us or our stockholders; (iii) any action or proceeding asserting a claim against us or any of our current or former directors, officers or other employees, arising out of or pursuant to any provision of the Delaware General Corporation Law, our certificate of incorporation or our bylaws; (iv) any action or proceeding to interpret, apply, enforce or determine the validity of our certificate of incorporation or our bylaws; (v) any action or proceeding as to which the Delaware General Corporation Law confers jurisdiction to the Court of Chancery of the State of Delaware; and (vi) any action asserting a claim against us or any of our directors, officers or other employees governed by the internal affairs doctrine, in all cases to the fullest extent permitted by law and subject to the court’s having personal jurisdiction 84 over the indispensable parties named as defendants; provided these provisions of our certificate of incorporation and bylaws will not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction; and provided that, unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the U.S. shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, or the Securities Act.
Our research activities may initially show promise in identifying potential product candidates, yet fail to yield product candidates for clinical development for many reasons, including the following: • the research methodology used may not be successful in identifying potential product candidates; • competitors may develop alternatives that render our potential product candidates obsolete; • product candidates that we develop may nevertheless be covered by third parties’ patents or other exclusive rights; • a product candidate may, on further study, be shown to have harmful side effects or other characteristics that indicate it is unlikely to be effective or otherwise does not meet applicable regulatory criteria; • a product candidate may not be capable of being produced in commercial quantities at an acceptable cost, or at all; and • a product candidate may not be accepted as safe and effective by patients, the medical community or third-party payors.
Our research activities or observation of third-party research activities may initially show promise in identifying potential product candidates, yet fail to yield product candidates for clinical development for many reasons, including the following: • the research methodology used may not be successful in identifying potential product candidates; • competitors may develop alternatives that render our potential product candidates obsolete; • product candidates that we develop may nevertheless be covered by third parties’ patents or other exclusive rights; • a product candidate may, on further study, be shown to have harmful side effects or other characteristics that indicate it is unlikely to be effective or otherwise does not meet applicable regulatory criteria; • a product candidate may not be capable of being produced in commercial quantities at an acceptable cost, or at all; and • a product candidate may not be accepted as safe and effective by patients, the medical community or third-party payors.
Regardless of the merits or eventual outcome, liability claims may result in: • decreased demand for any of our future approved products; • injury to our reputation; • withdrawal of clinical trial participants; • termination of clinical trial sites or entire trial programs; • significant litigation costs, including with respect to potential class action lawsuits; • substantial monetary awards to, or costly settlements with, patients or other claimants; • product recalls or a change in the indications for which they may be used; • loss of revenue; • diversion of management and scientific resources from our business operations; and • the inability to commercialize AMX0035 or any other current or future product candidates.
Regardless of the merits or eventual outcome, liability claims may result in: • decreased demand for any of our future approved products; • injury to our reputation; • withdrawal of clinical trial participants; • termination of clinical trial sites or entire trial programs; • significant litigation costs, including with respect to potential class action lawsuits; • substantial monetary awards to, or costly settlements with, patients or other claimants; • product recalls or a change in the indications for which they may be used; • loss of revenue; • diversion of management and scientific resources from our business operations; and • the inability to commercialize avexitide, AMX0035 or any other current or future product candidates.
Factors relating to our business that may contribute to these fluctuations include the following, as well as other factors described elsewhere in this Annual Report: • our ability to manufacture and deliver supply of AMX0035; • our ability to maintain market acceptance of our product and product candidates, if approved, as a treatment option; • delays or failures in advancement of existing or future development candidates into the clinic or product candidates in clinical trials; • the feasibility of developing, manufacturing, and commercializing our product and product candidates; • our ability to manage our growth; • the outcomes of research programs, clinical trials or other product development or approval processes; • our ability to successfully develop AMX0035 for additional indications and to commercialize AMX0035 for such additional indications, if approved; • risks associated with the international aspects of our business including the conduct of clinical trials in multiple locations and potential commercialization in such locations; • our ability to accurately report our financial results in a timely manner; • our dependence on, and the need to attract and retain, key management and other personnel; • our ability to obtain, protect and enforce our IP rights; 53 • our ability to prevent the theft or misappropriation of our IP, know-how or technologies; • advantages that our competitors and potential competitors may have in securing funding, obtaining the rights to critical IP or developing competing technologies or products; • our ability to obtain additional capital that may be necessary to expand our business; • business interruptions such as power outages, strikes, acts of terrorism or natural disasters; and • the ultimate impact of global economic and geopolitical events.
Factors relating to our business that may contribute to these fluctuations include the following, as well as other factors described elsewhere in this Annual Report: • our ability to manufacture and deliver supply of avexitide or AMX0035; • our ability to maintain market acceptance of our product and product candidates, if approved, as a treatment option; • delays or failures in advancement of existing or future development candidates into the clinic or product candidates in clinical trials; • the feasibility of developing, manufacturing, and commercializing our product and product candidates; • our ability to manage our growth; • the outcomes of research programs, clinical trials or other product development or approval processes; • our ability to successfully develop avexitide and AMX0035 for additional indications and to commercialize avexitide and AMX0035 for such additional indications, if approved; • risks associated with the international aspects of our business including the conduct of clinical trials in multiple locations and potential commercialization in such locations; • our ability to accurately report our financial results in a timely manner; • our dependence on, and the need to attract and retain, key management and other personnel; • our ability to obtain, protect and enforce our IP rights; • our ability to prevent the theft or misappropriation of our IP, know-how or technologies; • advantages that our competitors and potential competitors may have in securing funding, obtaining the rights to critical IP or developing competing technologies or products; • our ability to obtain additional capital that may be necessary to expand our business; • business interruptions such as power outages, strikes, acts of terrorism or natural disasters; and • the ultimate impact of global economic and geopolitical events.
The following examples are illustrative: • others may be able to make products that are competitive to AMX0035, for example a TURSO monotherapy, or any of our future product candidates but that are not covered by the claims of the patents that we own; • others may independently develop similar or alternative technologies or otherwise circumvent any of our technologies without infringing our intellectual property rights; • we or any of our collaborators might not have been the first to invent the inventions covered by the patents or patent applications that we own; • we or any of our collaborators might not have been the first to file patent applications covering certain of the patents or patent applications that we or they own or have obtained a license, or will own or will have obtained a license; • it is possible that our pending patent applications will not lead to issued patents; • issued patents that we own may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors; • our competitors might conduct research and development activities in countries where we do not have patent rights, or in countries where research and development safe harbor laws exist, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • ownership of our patents or patent applications may be challenged by third parties; • the patents of third parties or pending or future applications of third parties, if issued, may have an adverse effect on our business; and • patent enforcement is expensive and time-consuming and difficult to predict; thus we may not be able to enforce any of our patents against a competitor.
The following examples are illustrative: • others may be able to make products that are competitive to avexitide, AMX0035, for example a TURSO monotherapy, AMX0114 or any of our future product candidates but that are not covered by the claims of the patents that we own; • others may independently develop similar or alternative technologies or otherwise circumvent any of our technologies without infringing our intellectual property rights; • we or any of our collaborators might not have been the first to invent the inventions covered by the patents or patent applications that we own; • we or any of our collaborators might not have been the first to file patent applications covering certain of the patents or patent applications that we or they own or have obtained a license, or will own or will have obtained a license; • it is possible that our pending patent applications will not lead to issued patents; • issued patents that we own may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors; • our competitors might conduct research and development activities in countries where we do not have patent rights, or in countries where research and development safe harbor laws exist, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • ownership of our patents or patent applications may be challenged by third parties; • the patents of third parties or pending or future applications of third parties, if issued, may have an adverse effect on our business; and • patent enforcement is expensive and time-consuming and difficult to predict; thus we may not be able to enforce any of our patents against a competitor.
In addition, even if we were to obtain approval, regulatory authorities may approve AMX0035 or any other current or future product candidates for fewer or more limited indications than we request, may not approve the price we intend to charge for our products, may grant approval contingent on the performance of costly post-marketing preclinical studies and clinical trials, or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate.
In addition, even if we were to obtain approval, regulatory authorities may approve avexitide, AMX0035 or any other current or future product candidates for fewer or more limited indications than we request, may not approve the price we intend to charge for our products, may grant approval contingent on the performance of costly post-marketing preclinical studies and clinical trials, or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate.
The development of neurodegenerative and CNS therapies presents unique challenges, including an imperfect understanding of the biology, the presence of the blood brain barrier that can restrict the flow of drugs to the brain, a frequent lack of translatability of preclinical study results in subsequent clinical trials and dose selection, and the product candidate having an effect that may be too small to be detected using the outcome measures selected in clinical trials or if the outcomes measured do not reach statistical significance.
The development of neurodegenerative therapies presents unique challenges, including an imperfect understanding of the biology, the presence of the blood brain barrier that can restrict the flow of drugs to the brain, a frequent lack of translatability of preclinical study results in subsequent clinical trials and dose selection, and the product candidate having an effect that may be too small to be detected using the outcome measures selected in clinical trials or if the outcomes measured do not reach statistical significance.
In addition, pursuant to our ESPP, the number of shares of our common stock reserved for issuance will automatically increase on January 1 of each calendar year, beginning on January 1, 2023 (through January 1, 2032), by the lesser of (i) 1.0% of the total number of shares of our common stock outstanding on the last day of the calendar month before the date of the automatic increase, and (ii) 1,210,000 shares; provided that before the date of any such increase, our board of directors may determine that such increase will be less than the amount set forth in clauses (i) and (ii).
In addition, pursuant to our ESPP, the number of shares of our common stock reserved for issuance will automatically increase on January 1 of each calendar year, beginning on January 1, 2023 (through January 1, 2032), by the lesser of (i) 1.0% of the total number of shares 86 of our common stock outstanding on the last day of the calendar month before the date of the automatic increase, and (ii) 1,210,000 shares; provided that before the date of any such increase, our board of directors may determine that such increase will be less than the amount set forth in clauses (i) and (ii).
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare and/or impose price controls may adversely affect: • the demand for AMX0035 or any other current or future product candidates; • our ability to set a price that we believe is fair for our approved products; • our ability to generate revenue and achieve or maintain profitability; • the level of taxes that we are required to pay; and • the availability of capital.
The continuing efforts of the government, insurance companies, managed care organizations and other payors of healthcare services to contain or reduce costs of healthcare and/or impose price controls may adversely affect: • the demand for avexitide, AMX0035 or any other current or future product candidates; • our ability to set a price that we believe is fair for our approved products; • our ability to generate revenue and achieve or maintain profitability; • the level of taxes that we are required to pay; and • the availability of capital.
The degree of market acceptance of AMX0035 and any other future product candidates, if approved for commercial sale, will depend on a number of factors, including: • the efficacy and safety of the product; • the potential advantages of the product compared to competitive therapies and our ability to successfully publicize these advantages or highlight them in any marketing materials; • the prevalence and severity of any side effects; • whether the product is designated under physician treatment guidelines as a first-, second- or third-line therapy or as a single agent or in combination; • our ability, or the ability of any future collaborators, to offer the product for sale at competitive prices; 58 • the product’s convenience, tolerability and ease of administration compared to alternative treatments; • the willingness of the target patient population to try, and of physicians to prescribe, the product; • limitations or warnings, including distribution or use restrictions contained in the product’s approved labeling; • the strength of sales, marketing and distribution support; • changes in the standard of care for the targeted indications for the product; and • availability and adequacy of coverage and reimbursement from government payors, managed care plans and other third-party payors.
The degree of market acceptance of avexitide, AMX0035 and any other future product candidates, if approved for commercial sale, will depend on a number of factors, including: • the efficacy and safety of the product; • the potential advantages of the product compared to competitive therapies and our ability to successfully publicize these advantages or highlight them in any marketing materials; • the prevalence and severity of any side effects; • whether the product is designated under physician treatment guidelines as a first-, second- or third-line therapy or as a single agent or in combination; • our ability, or the ability of any future collaborators, to offer the product for sale at competitive prices; • the product’s convenience, tolerability and ease of administration compared to alternative treatments; • the willingness of the target patient population to try, and of physicians to prescribe, the product; • limitations or warnings, including distribution or use restrictions contained in the product’s approved labeling; • the strength of sales, marketing and distribution support; • changes in the standard of care for the targeted indications for the product; and • availability and adequacy of coverage and reimbursement from government payors, managed care plans and other third-party payors.
Outside the U.S., international operations are generally subject to extensive governmental price controls and other market regulations, and we believe the increasing emphasis on cost-containment initiatives in Canada, the EU and other countries has and will continue to put pressure on the pricing and usage of drug products such as AMX0035 and any other current or future product candidates we may develop, if approved.
Outside the U.S., international operations are generally subject to extensive governmental price controls and other market regulations, and we believe the increasing emphasis on cost-containment initiatives in Canada, the EU and other countries has and will continue to put pressure on the pricing and usage of drug products such as avexitide, AMX0035 and any other current or future product candidates we may develop, if approved.
Collaborations involving AMX0035 and any other current or future product candidates pose a number of risks, including the following: • collaborators have significant discretion in determining the efforts and resources that they will apply to these collaborations; • collaborators may not perform their obligations as expected; • collaborators may not pursue development and commercialization of AMX0035 or any future product candidates or may elect not to continue or renew development or commercialization programs, based on clinical trial results, changes in the collaborators’ strategic focus or available funding or external factors, such as an acquisition, that divert resources or create competing priorities; • collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing; • collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with AMX0035 or any of our other current or future product candidates; • a collaborator with marketing and distribution rights to one or more products may not commit sufficient resources to the marketing and distribution of such product or products; • disagreements with collaborators, including disagreements over proprietary rights, including trade secrets and intellectual property rights, contract interpretation, or the preferred course of development might cause delays or termination of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive; • collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation; • collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability; and • collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable product candidates. 89 Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner or at all.
Collaborations involving avexitide, AMX0035 and any other current or future product candidates pose a number of risks, including the following: • collaborators have significant discretion in determining the efforts and resources that they will apply to these collaborations; • collaborators may not perform their obligations as expected; • collaborators may not pursue development and commercialization of avexitide, AMX0035 or any future product candidates or may elect not to continue or renew development or commercialization programs, based on clinical trial results, changes in the collaborators’ strategic focus or available funding or external factors, such as an acquisition, that divert resources or create competing priorities; • collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing; • collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with avexitide, AMX0035 or any of our other current or future product candidates; • a collaborator with marketing and distribution rights to one or more products may not commit sufficient resources to the marketing and distribution of such product or products; • disagreements with collaborators, including disagreements over proprietary rights, including trade secrets and intellectual property rights, contract interpretation, or the preferred course of development might cause delays or termination of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive; • collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation; • collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability; and • collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable product candidates. 55 Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner or at all.
As described above, under the Orphan Drug Act, the FDA may designate a drug as an orphan drug if it is intended to treat a rare disease or condition, which is generally defined as a patient population of fewer than 200,000 people in the U.S., or a patient population 84 of greater than 200,000 people in the U.S., but for which there is no reasonable expectation that the cost of developing the drug will be recovered from sales in the U.S.
As described above, under the Orphan Drug Act, the FDA may designate a drug as an orphan drug if it is intended to treat a rare disease or condition, which is generally defined as a patient population of fewer than 200,000 people in the U.S., or a patient population of greater than 200,000 people in the U.S., but for which there is no reasonable expectation that the cost of developing the drug will be recovered from sales in the U.S.
Our failure, or the failure of our third-party manufacturers, to comply with applicable regulations could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, seizures or voluntary recalls of AMX0035 or any other current or future product candidates, operating restrictions and criminal prosecutions, any of which could significantly affect supplies of AMX0035 or any other current or future product candidates.
Our failure, or the failure of our third-party manufacturers, to comply with applicable regulations could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, seizures or voluntary recalls of avexitide, AMX0035 or any other current or future product candidates, operating restrictions and criminal prosecutions, any of which could significantly affect supplies of avexitide, AMX0035 or any other current or future product candidates.
Significant clinical trial delays or the need for additional data from our clinical trials also could shorten any periods during which we may have the exclusive right to commercialize AMX0035 or any other current or future product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize such product candidates, which may harm our business and results of operations.
Significant clinical trial delays or the need for additional data from our clinical trials also could shorten any periods during which we may have the exclusive right to commercialize avexitide, AMX0035 or any other current or future product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize such product candidates, which may harm our business and results of operations.
Following approval for AMX0035 or any other future product candidate, we may face competition based on many different factors, including the efficacy, safety and tolerability of our products, the ease with which our products can be administered, the timing and scope of regulatory approvals for these products, the availability and cost of manufacturing, marketing and sales capabilities, price, reimbursement coverage and patent position.
Following any approval for avexitide, AMX0035 or any other future product candidate, we may face competition based on many different factors, including the efficacy, safety and tolerability of our products, the ease with which our products can be administered, the timing and scope of regulatory approvals for these products, the availability and cost of manufacturing, marketing and sales capabilities, price, reimbursement coverage and patent position.
We base our market opportunity estimates on a variety of factors, including our estimates of the number of people who have these diseases, the potential scope of our approved product labels, the subset of people with these diseases who have the potential to benefit from treatment with AMX0035 or any other current or future product candidates, various pricing scenarios, and our understanding of reimbursement policies for rare diseases in particular countries.
We base our market opportunity estimates on a variety of factors, including our estimates of the number of people who have these diseases, the potential scope of our approved product labels, the subset of people with these diseases who have the potential to benefit from treatment with avexitide, AMX0035 or any other current or future product candidates, various pricing scenarios, and our understanding of reimbursement policies for rare diseases in particular countries.
In addition, we cannot assure you that any such products that are approved will be manufactured or produced economically, successfully commercialized or widely accepted in the marketplace or be more effective than other commercially available alternatives. Research activities to identify product candidates require substantial technical, financial and human resources, whether or not any product candidates are ultimately identified.
In addition, we cannot assure you that any such products that are approved will be manufactured or produced economically, successfully commercialized or widely accepted in the marketplace or be more effective than other commercially available alternatives. 45 Research activities to identify product candidates require substantial technical, financial and human resources, whether or not any product candidates are ultimately identified.
If these third parties, including clinical investigators, do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we may not be able to obtain, or may be delayed in obtaining, clinical data necessary for regulatory approvals for AMX0035 or any other current or future product candidates.
If these third parties, including clinical investigators, do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we may not be able to obtain, or may be delayed in obtaining, clinical data necessary for regulatory approvals for avexitide, AMX0035 or any other current or future product candidates.
Additionally, certain clinical trials for AMX0035 and any other current or future product candidates may be focused on indications with relatively small patient populations, which may further limit enrollment of eligible patients or may result in slower enrollment than we anticipate. The eligibility criteria of our clinical trials, once established, may further limit the pool of available trial participants.
Additionally, certain clinical trials for avexitide, AMX0035 and any other current or future product candidates may be focused on indications with relatively small patient populations, which may further limit enrollment of eligible patients or may result in slower enrollment than we anticipate. The eligibility criteria of our clinical trials, once established, may further limit the pool of available trial participants.
There is no assurance that we will be able to timely secure needed supply arrangements on satisfactory terms, or at all. Our failure to secure these arrangements as needed could have a material adverse effect on our ability to complete the development of AMX0035 or any other current or future product candidates or, to commercialize them, if approved.
There is no assurance that we will be able to timely secure needed supply arrangements on satisfactory terms, or at all. Our failure to secure these arrangements as needed could have a material adverse effect on our ability to complete the development of avexitide, AMX0035 or any other current or future product candidates or, to commercialize them, if approved.
We expect that we will need significant additional capital in the future to continue our planned operations, including conducting clinical trials, commercialization efforts if we are able to obtain marketing approval of any of AMX0035 or any other current or future product candidates, research and development activities, and costs associated with operating a public company.
We expect that we will need significant additional capital in the future to continue our planned operations, including conducting clinical trials, commercialization efforts if we are able to obtain marketing approval of any of avexitide, AMX0035 or any other current or future product candidates, research and development activities, and costs associated with operating a public company.
Moreover, the extent to which geopolitical events or global health crises may impact our ability to procure sufficient supplies for the development of AMX0035, and any other current or future products and product candidates will depend on whether the economic challenges caused by such events continue to impact the global economy and supply chains, among many other factors.
Moreover, the extent to which geopolitical events or global health crises may impact our ability to procure sufficient supplies for the development of AMX0035 and avexitide, and any other current or future products and product candidates will depend on whether the economic challenges caused by such events continue to impact the global economy and supply chains, among many other factors.
In some cases, the technical skills required to manufacture AMX0035, or any other current or future products or product candidates may be unique or proprietary to the original contract manufacturer and we may have difficulty, or there may be contractual restrictions prohibiting us from, transferring such skills to a back-up or alternate supplier, or we may be unable to transfer such skills at all.
In some cases, the technical skills required to manufacture avexitide, AMX0035 or any other current or future products or product candidates may be unique or proprietary to the original contract manufacturer and we may have difficulty, or there may be contractual restrictions prohibiting us from, transferring such skills to a back-up or alternate supplier, or we may be unable to transfer such skills at all.
An adverse determination in any such challenges may result in loss of the patent or in patent or patent application claims being narrowed, invalidated or held unenforceable, in whole or in part, or in denial of the patent application or loss or reduction in the scope of one or more claims of the patent or patent application, any of which could limit our ability to stop 94 others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and products.
An adverse determination in any such challenges may result in loss of the patent or in patent or patent application claims being narrowed, invalidated or held unenforceable, in whole or in part, or in denial of the patent application or loss or reduction in the scope of one or more claims of the patent or patent application, any of which could limit our ability to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and products.
It is possible that technology relevant to our business will be independently developed by a person who is not a party to such a confidentiality or invention assignment agreement. We may not be able to prevent the unauthorized disclosure or use of our technical knowledge or trade 95 secrets by consultants, collaborators, vendors, advisors, former employees and current employees.
It is possible that technology relevant to our business will be independently developed by a person who is not a party to such a confidentiality or invention assignment agreement. We may not be able to prevent the unauthorized disclosure or use of our technical knowledge or trade secrets by consultants, collaborators, vendors, advisors, former employees and current employees.
We also seek to preserve the integrity and confidentiality of our confidential proprietary information by maintaining physical security of our premises and physical and electronic security of our IT systems, but it is possible that these security measures could be breached. In addition, courts outside the U.S. are sometimes less willing to protect trade secrets.
We also seek to preserve the integrity and confidentiality of 70 our confidential proprietary information by maintaining physical security of our premises and physical and electronic security of our IT systems, but it is possible that these security measures could be breached. In addition, courts outside the U.S. are sometimes less willing to protect trade secrets.
Even if AMX0035 for the treatment of any indication, or any other current or future product candidate of ours, is approved by the appropriate regulatory authorities for marketing and sale, it may nonetheless fail to gain sufficient market acceptance by physicians, patients, third-party payors and others in the medical community.
Even if avexitide, AMX0035 for the treatment of any indication or any other current or future product candidate of ours, is approved by the appropriate regulatory authorities for marketing and sale, it may nonetheless fail to gain sufficient market acceptance by physicians, patients, third-party payors and others in the medical community.
If we, or any future collaborators, do not market AMX0035 or any of our other current or future product candidates for which we, or they, receive regulatory approval for only their approved indications, we, or they, may be subject to warnings or enforcement action for off-label marketing if it is alleged that we are doing so.
If we, or any future collaborators, do not market avexitide, AMX0035 or any of our other current or future product candidates for which we, or they, receive regulatory approval for only their approved indications, we, or they, may be subject to warnings or enforcement action for off-label marketing if it is alleged that we are doing so.
These laws and future state and federal healthcare reform measures that may be adopted in the future may result in additional reductions in Medicare and other healthcare funding and otherwise affect the prices we may obtain for AMX0035 or any other current or future product candidates for which we may obtain regulatory approval or the frequency with which any such product candidate is prescribed or used.
These laws and future state and federal healthcare reform measures that may be adopted in the future may result in additional reductions in Medicare and other healthcare funding and otherwise affect the prices we may obtain for avexitide, AMX0035 or any other current or future product candidates for which we may obtain regulatory approval or the frequency with which any such product candidate is prescribed or used.
We cannot be certain that, upon inspection, the FDA, the EMA or other regulatory body will determine that any of our clinical trials comply with GCPs. For example, our clinical trial sites and investigators have in the past and may in the future engage in protocol deviations which could impact the overall interpretability of the outcomes of our clinical trials.
We cannot be certain that, upon inspection, the FDA or other regulatory body will determine that any of our clinical trials comply with GCPs. For example, our clinical trial sites and investigators have in the past and may in the future engage in protocol deviations which could impact the overall interpretability of the outcomes of our clinical trials.
For example: • we may not be able to generate sufficient data to support full patent applications that protect the entire breadth of developments in one or more of our programs; • it is possible that one or more of our pending patent applications will not become an issued patent or, if issued, that the patent(s) claims will have sufficient scope to protect our technology, provide us with commercially viable patent protection or provide us with any competitive advantages; • if our pending applications issue as patents, they may be challenged by third parties as invalid or unenforceable under U.S. or foreign laws; • we may not successfully commercialize AMX0035 before our relevant patents expire; • we may not be the first to make the inventions covered by each of our patents and pending patent applications; or • we may not develop additional proprietary technologies or product candidates that are separately patentable.
For example: • we may not be able to generate sufficient data to support full patent applications that protect the entire breadth of developments in one or more of our programs; • it is possible that one or more of our pending patent applications will not become an issued patent or, if issued, that the patent(s) claims will have sufficient scope to protect our technology, provide us with commercially viable patent protection or provide us with any competitive advantages; • if our pending applications issue as patents, they may be challenged by third parties as invalid or unenforceable under U.S. or foreign laws; • we may not successfully commercialize avexitide, AMX0035 or AMX0114 before our relevant patents expire; • we may not be the first to make the inventions covered by each of our patents and pending patent applications; or • we may not develop additional proprietary technologies or product candidates that are separately patentable.
Further, in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Dodd-Frank Act, was 110 enacted. There are significant corporate governance and executive compensation related provisions in the Dodd-Frank Act that require the SEC to adopt additional rules and regulations in these areas such as “say on pay” and proxy access.
Further, in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the Dodd-Frank Act, was enacted. There are significant corporate governance and executive compensation related provisions in the Dodd-Frank Act that require the SEC to adopt additional rules and regulations in these areas such as “say on pay” and proxy access.
In such an event, competitors might be able to enter the market earlier than would otherwise have been the case; • patent applications may not result in any patents being issued; • patents that may be issued or in-licensed may be challenged, invalidated, modified, revoked, circumvented, found to be unenforceable or otherwise may not provide any competitive advantage; • our competitors, many of whom have substantially greater resources and many of whom have made significant investments in competing technologies, may seek or may have already obtained patents that will limit, interfere with or eliminate our ability to make, use, and sell AMX0035; • there may be significant pressure on the U.S. government and international governmental bodies to limit the scope of patent protection both inside and outside the U.S. for disease treatments that prove successful, as a matter of public policy regarding worldwide health concerns; • countries other than the U.S. may have patent laws less favorable to patentees than those upheld by U.S. courts, allowing foreign competitors a better opportunity to create, develop and market competing product candidates; and • countries other than the U.S. may, under certain circumstances, force us to grant a license under our patents to a competitor, thus allowing the competitor to compete with us in that jurisdiction or forcing us to lower the price of our drug in that jurisdiction.
In such an event, competitors might be able to enter the market earlier than would otherwise have been the case; • patent applications may not result in any patents being issued; • patents that may be issued or in-licensed may be challenged, invalidated, modified, revoked, circumvented, found to be unenforceable or otherwise may not provide any competitive advantage; • our competitors, many of whom have substantially greater resources and many of whom have made significant investments in competing technologies, may seek or may have already obtained patents that will limit, interfere with or eliminate our ability to make, use, and sell avexitide, AMX0035 or AMX0114; • there may be significant pressure on the U.S. government and international governmental bodies to limit the scope of patent protection both inside and outside the U.S. for disease treatments that prove successful, as a matter of public policy regarding worldwide health concerns; 68 • countries other than the U.S. may have patent laws less favorable to patentees than those upheld by U.S. courts, allowing foreign competitors a better opportunity to create, develop and market competing product candidates; and • countries other than the U.S. may, under certain circumstances, force us to grant a license under our patents to a competitor, thus allowing the competitor to compete with us in that jurisdiction or forcing us to lower the price of our drug in that jurisdiction.
To obtain regulatory approval to commercialize AMX0035 and any other current or future product candidates, we must demonstrate through extensive preclinical studies and clinical trials that such product candidates are safe and effective in humans. Preclinical and clinical testing are expensive and can take many years to complete, and their outcome is inherently uncertain.
To obtain regulatory approval to commercialize avexitide, AMX0035 and any other current or future product candidates, we must demonstrate through extensive preclinical studies and clinical trials that such product candidates are safe and effective in humans. Preclinical and clinical testing are expensive and can take many years to complete, and their outcome is inherently uncertain.
If we are unable to identify patients and successfully commercialize AMX0035 or any other current or future product candidates with attractive market opportunities, our future product revenues may be smaller than anticipated, and our business may suffer. Patient identification efforts also influence the ability to address a patient population.
If we are unable to identify patients and successfully commercialize avexitide, AMX0035 or any other current or future product candidates with attractive market opportunities, our future product revenues may be smaller than anticipated, and our business may suffer. Patient identification efforts also influence the ability to address a patient population.
In some countries, including Canada and certain Member States of the EU, the pricing of prescription drugs is, in part, subject to governmental control. Additional countries may adopt similar approaches to the pricing of prescription drugs. In such countries, pricing negotiations with governmental authorities can take considerable time after receipt of regulatory approval for a product.
In some countries, including Canada and certain Member States of the EU, the pricing of prescription drugs is, in part, subject to governmental control. Additional countries may adopt similar approaches to the pricing of prescription drugs. In 62 such countries, pricing negotiations with governmental authorities can take considerable time after receipt of regulatory approval for a product.
In some countries, we may be required to conduct a clinical trial or other trials that compare the cost-effectiveness of AMX0035 or any other current or future product candidates to other available therapies in order to obtain or maintain reimbursement or pricing approval, which is time-consuming and costly.
In some countries, we may be required to conduct a clinical trial or other trials that compare the cost-effectiveness of avexitide, AMX0035 or any other current or future product candidates to other available therapies in order to obtain or maintain reimbursement or pricing approval, which is time-consuming and costly.
If pricing is set at unsatisfactory levels or if reimbursement of our products is unavailable or limited in scope or amount, our revenues from sales by us or our strategic partners and the potential profitability of AMX0035 or any other current or future product candidates in those countries would be negatively affected.
If pricing is set at unsatisfactory levels or if reimbursement of our products is unavailable or limited in scope or amount, our revenues from sales by us or our strategic partners and the potential profitability of avexitide, AMX0035 or any other current or future product candidates in those countries would be negatively affected.
If we, and any future collaborators, are not able to comply with post-approval regulatory requirements, we, and any future collaborators, could have the regulatory approvals for AMX0035 or any other current or future products withdrawn by regulatory authorities and our, or any future collaborators’, ability to market any future products could be limited, which could adversely affect our ability to achieve or sustain profitability.
If we, and any future collaborators, are not able to comply with post-approval regulatory requirements, we, and any future collaborators, could have the regulatory approvals for avexitide, AMX0035 or any other current or future products withdrawn by regulatory authorities and our, or any future collaborators’, ability to market any future products could be limited, which could adversely affect our ability to achieve or sustain profitability.
Neither can we make assurances as to the scope of any claims that may issue from our pending and future patent applications nor to the outcome of any proceedings by any potential third parties that could challenge the patentability, validity or enforceability of our patents and patent applications in the U.S. or foreign jurisdictions.
Neither can we make assurances as to the scope of any claims that may issue from our pending and future patent applications nor to the outcome of any proceedings by any potential third parties that could challenge the patentability, validity or enforceability of our patents and patent applications in the U.S. or 69 foreign jurisdictions.
Accordingly, in any jurisdiction where we or any future collaborators, receive regulatory approval for AMX0035 or one or more future product candidates, we, and any future collaborators, and our and their contract manufacturers will continue to expend time, money and effort in all areas of regulatory compliance, including manufacturing, production, product surveillance and quality control.
Accordingly, in any jurisdiction where we or any future collaborators, receive regulatory approval for avexitide, AMX0035 or one or more future product candidates, we, and any future collaborators, and our and their contract manufacturers will continue to expend time, money and effort in all areas of regulatory compliance, including manufacturing, production, product surveillance and quality control.
Even if they are unchallenged, our owned patents and pending patent applications, if issued, may not provide us with any meaningful protection or prevent competitors from designing around our patent claims to circumvent our patents by 93 developing similar or alternative therapeutics in a non-infringing manner.
Even if they are unchallenged, our owned patents and pending patent applications, if issued, may not provide us with any meaningful protection or prevent competitors from designing around our patent claims to circumvent our patents by developing similar or alternative therapeutics in a non-infringing manner.
The data exclusivity, if granted, prevents generic or biosimilar applicants from referencing the innovator’s preclinical and clinical trial data contained in the dossier of the reference product when applying for a generic or biosimilar marketing authorization, for a period of eight years from the date on which the reference product was first authorized in the EU.
The data exclusivity, if granted, prevents generic or biosimilar applicants from 71 referencing the innovator’s preclinical and clinical trial data contained in the dossier of the reference product when applying for a generic or biosimilar marketing authorization, for a period of eight years from the date on which the reference product was first authorized in the EU.
If the FDA, the EMA or other comparable foreign regulatory authorities require us to conduct one or more clinical trials to support such a demonstration, such as a factorial study, the design, duration, and scope of such clinical trials will be decided upon after further discussions with those agencies and other comparable foreign regulatory authorities.
If the FDA or other comparable foreign regulatory authorities require us to conduct one or more clinical trials to support such a demonstration, such as a factorial study, the design, duration, and scope of such clinical trials will be decided upon after further discussions with those agencies and other comparable foreign regulatory authorities.
Inadequate training in recognizing or managing the potential side effects of AMX0035 or any future product candidates could result in patient injury or death. Any of these occurrences may harm our business, financial condition and prospects significantly. Bitter taste was frequently observed in our clinical trials of AMX0035.
Inadequate training in recognizing or managing the potential side effects of avexitide, AMX0035 or any future product candidates could result in patient injury or death. Any of these occurrences may harm our business, financial condition and prospects significantly. Bitter taste was frequently observed in our clinical trials of AMX0035.
Even if AMX0035 receives marketing approval and is commercialized in a jurisdiction, we would continue to be subject to the risks that the applicable regulatory authorities could revoke approval of PB or TURSO or any active moiety in AMX0035, if applicable, or that efficacy, manufacturing or supply issues could 79 arise with PB or TURSO or any active moiety in AMX0035, if applicable.
Even if AMX0035 receives marketing approval and is commercialized in a jurisdiction, we would continue to be subject to the risks that the applicable regulatory authorities could revoke approval of PB or TURSO or any active moiety in AMX0035, if applicable, or that efficacy, manufacturing or supply issues could arise with PB or TURSO or any active moiety in AMX0035, if applicable.
Obtaining and maintaining regulatory approval of AMX0035 and any future product candidates in one jurisdiction does not guarantee that we will be able to obtain or maintain regulatory approval in any other jurisdiction, while a failure or delay in obtaining regulatory approval in one jurisdiction may have a negative effect on the regulatory approval process in others.
Obtaining and maintaining regulatory approval of avexitide, AMX0035 and any future product candidates in one jurisdiction does not guarantee that we will be able to obtain or maintain regulatory approval in any other jurisdiction, while a failure or delay in obtaining regulatory approval in one jurisdiction may have a negative effect on the regulatory approval process in others.
In either case, the applicant for orphan designation must also demonstrate 83 that no satisfactory method of diagnosis, prevention, or treatment for the condition has been authorized (or, if such a method exists, the new product would be a significant benefit to those affected compared to the product available).
In either case, the applicant for orphan designation must also demonstrate that no satisfactory method of diagnosis, prevention, or treatment for the condition has been authorized (or, if such a method exists, the new product would be a significant benefit to those affected compared to the product available).
Moreover, the FDA, the EMA and competent authorities of the EU Member States require us to comply with Good Clinical Practices, or GCPs, for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of trial participants are protected.
Moreover, the FDA and competent authorities of the EU Member States require us to comply with Good Clinical Practices, or GCPs, for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of trial participants are protected.
To protect this type of information against disclosure or appropriation by competitors, our policy is to require our employees, consultants, contractors and 101 advisors to enter into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with us prior to beginning research or disclosing proprietary information.
To protect this type of information against disclosure or appropriation by competitors, our policy is to require our employees, consultants, contractors and advisors to enter into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with us prior to beginning research or disclosing proprietary information.
For these purposes, an ownership change generally occurs where the aggregate stock ownership of one or more stockholders or groups of stockholders who owns at least five percent of a corporation’s 111 stock increases its ownership by more than 50 percentage points over its lowest ownership percentage within a specified testing period.
For these purposes, an ownership change generally occurs where the aggregate stock ownership of one or more stockholders or groups of stockholders who owns at least five percent of a corporation’s stock increases its ownership by more than 50 percentage points over its lowest ownership percentage within a specified testing period.
This process is difficult and time consuming and we may face competition for access to manufacturing facilities as there are a limited number of contract manufacturers operating under cGMPs that are capable of manufacturing AMX0035 or any other current or future product candidates.
This process is difficult and time consuming and we may face competition for access to manufacturing facilities as there are a limited number of contract manufacturers operating under cGMPs that are capable of manufacturing avexitide, AMX0035 or any other current or future product candidates.
Furthermore, while we intend to protect our intellectual property rights in major markets for our products, we cannot ensure that we will be able to initiate or maintain similar efforts 98 in all jurisdictions in which we may wish to market our products, if approved. Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate.
Furthermore, while we intend to protect our intellectual property rights in major markets for our products, we cannot ensure that we will be able to initiate or maintain similar efforts in all jurisdictions in which we may wish to market our products, if approved. Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate.
Because AMX0035 and any other current or future product candidates represent new approaches to the treatment of the diseases they target, we cannot be sure that coverage and reimbursement will be available for, or accurately estimate the potential revenue from, AMX0035 and any other current or future product candidates or for any product that we may develop.
Because avexitide, AMX0035 and any other current or future product candidates represent new approaches to the treatment of the diseases they target, we cannot be sure that coverage and reimbursement will be available for, or accurately estimate the potential revenue from, avexitide, AMX0035 and any other current or future product candidates or for any product that we may develop.
Inadequate reimbursement for such services may lead to physician and payor resistance and adversely affect our ability to market or sell AMX0035 or any other current or future product candidates we may develop. In addition, we may need to develop new reimbursement models, in order to realize adequate value.
Inadequate reimbursement for such services may lead to physician and payor resistance and adversely affect our ability to market or sell avexitide, AMX0035 or any other current or future product candidates we may develop. In addition, we may need to develop new reimbursement models, in order to realize adequate value.
Government authorities and other third-party payors decide which drugs and treatments they will cover and the reimbursement amount. Coverage and reimbursement by a third-party payor may depend upon a number of factors. 62 In the U.S., no uniform policy of coverage and reimbursement for products exists among third-party payors.
Government authorities and other third-party payors decide which drugs and treatments they will cover and the reimbursement amount. Coverage and reimbursement by a third-party payor may depend upon a number of factors. In the U.S., no uniform policy of coverage and reimbursement for products exists among third-party payors.
Similarly, in our clinical trials we may fail to detect toxicity of or intolerability caused by AMX0035 or any other current or future product candidate, or mistakenly believe that AMX0035 or any other current or future product candidates are toxic or not well-tolerated when that is not in fact the case.
Similarly, in our clinical trials we may fail to detect toxicity of or intolerability caused by avexitide, AMX0035 or any other current or future product candidate, or mistakenly believe that avexitide, AMX0035 or any other current or future product candidates are toxic or not well-tolerated when that is not in fact the case.
This lengthy approval process as well as the unpredictability of clinical trial results may result in our failing to obtain regulatory approval to market AMX0035 or any future product candidate we develop, which would significantly harm our business, results of operations and prospects.
This lengthy approval process as well as the unpredictability of clinical trial results may result in our failing to obtain regulatory approval to market avexitide, AMX0035 or any future product candidate we develop, which would significantly harm our business, results of operations and prospects.
Securing regulatory approval requires the submission of extensive preclinical and clinical data and supporting information to the various regulatory authorities for each therapeutic indication to establish the biologic product candidate’s safety, purity, efficacy and potency. Securing regulatory approval also requires the submission of information about the product manufacturing process to, and inspection of manufacturing facilities by, the relevant regulatory authority.
Securing regulatory approval requires the submission of extensive preclinical and clinical data and supporting information to the various regulatory authorities for each therapeutic indication to establish the product candidate’s safety, purity, efficacy and potency. Securing regulatory approval also requires the submission of information about the product manufacturing process to, and inspection of manufacturing facilities by, the relevant regulatory authority.
AMX0035 or any future product candidate may cause undesirable side effects or have other properties that could delay or prevent its regulatory approval, limit the commercial profile of an approved label, or result in significant negative consequences following regulatory approval, if obtained.
Avexitide, AMX0035 or any future product candidate may cause undesirable side effects or have other properties that could delay or prevent its regulatory approval, limit the commercial profile of an approved label, or result in significant negative consequences following regulatory approval, if obtained.
We are continuing to monitor inflation, the situations in Ukraine and Israel and global capital markets and assessing their potential impact on our business, including the impact on the supply chains we rely on for the manufacture of AMX0035 or any other current or future product candidates.
We are continuing to monitor inflation, the situations in Ukraine and Israel and global capital markets and assessing their potential impact on our business, including the impact on the supply chains we rely on for the manufacture of avexitide, AMX0035 or any other current or future product candidates.
Further, our general liability insurance and corporate risk program may not cover all potential claims to which we are exposed and may not be adequate to indemnify us for all liability that maybe imposed and could have a material adverse effect on our business and prospects.
Further, our cybersecurity insurance, general liability insurance and corporate risk program may not cover all potential claims to which we are exposed and may not be adequate to indemnify us for all liability that maybe imposed and could have a material adverse effect on our business and prospects.
If the actual number of patients with these diseases is smaller than we anticipate, we may encounter difficulties in enrolling patients in our clinical trials, thereby delaying or preventing development and approval of AMX0035 or any other current or future product candidates.
If the actual number of patients with these diseases is smaller than we anticipate, we may encounter difficulties in enrolling patients in our clinical trials, thereby delaying or preventing development and approval of avexitide, AMX0035 or any other current or future product candidates.
Undesirable side effects in one of our clinical trials for AMX0035 in one indication could adversely affect enrollment in clinical trials, regulatory approval and commercialization of AMX0035 in other indications. Additionally, there may be negative findings regarding components of AMX0035 or future product candidates by other parties.
Undesirable side effects in one of our clinical trials for AMX0035 in one indication or avexitide could adversely affect enrollment in clinical trials, regulatory approval and commercialization of AMX0035 in other indications or avexitide. Additionally, there may be negative findings regarding components of avexitide, AMX0035 or future product candidates by other parties.
If we are unsuccessful in identifying and developing additional product candidates, our potential for growth and achieving our strategic objectives may be impaired. We may not be successful in our efforts to expand our pipeline by identifying additional product candidates or indications and modifications for which to investigate AMX0035 in the future.
If we are unsuccessful in identifying and developing additional product candidates, our potential for growth and achieving our strategic objectives may be impaired. We may not be successful in our efforts to expand our pipeline by identifying additional product candidates or indications and modifications for which to investigate avexitide or AMX0035 in the future.
If we fail to comply with the regulatory requirements in international markets and/or obtain and maintain applicable marketing approvals, our target market will be reduced and our ability to realize the full market potential of AMX0035 or any future product candidates will be harmed.
If we fail to comply with the regulatory requirements in international markets and/or obtain and maintain applicable marketing approvals, our target market will be reduced and our ability to realize the full market potential of avexitide, AMX0035 or any future product candidates will be harmed.
We have entered and may in the future enter into collaborations with third parties for the development and commercialization of AMX0035 or any other current or future product candidates, and our prospects with respect to AMX0035 and our other current or future product candidates will depend in significant part on the success of those collaborations.
We have entered and may in the future enter into collaborations with third parties for the development and commercialization of avexitide, AMX0035 or any other current or future product candidates, and our prospects with respect to avexitide, AMX0035 and our other current or future product candidates will depend in significant part on the success of those collaborations.
In such an event, our financial results and the commercial prospects for AMX0035 or any other current or future product candidates that we seek to develop could be harmed, our costs could increase and our ability to generate revenues could be delayed, impaired or foreclosed.
In such an event, our financial results and the commercial prospects for avexitide, AMX0035 or any other current or future product candidates that we seek to develop could be harmed, our costs could increase and our ability to generate revenues could be delayed, impaired or foreclosed.
PTE is limited to the approved indication (or any additional indications 97 approved during the period of extension). We anticipate applying for PTE in the U.S. Similar extensions may be available in other countries where we are prosecuting patents and we likewise anticipate applying for such extensions.
PTE is limited to the approved indication (or any additional indications approved during the period of extension). We anticipate applying for PTE in the U.S. Similar extensions may be available in other countries where we are prosecuting patents and we likewise anticipate applying for such extensions.
Although we would be given an opportunity to respond to those rejections, we may be unable to 100 overcome such rejections. In addition, in the USPTO and in comparable agencies in many foreign jurisdictions, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks.
Although we would be given an opportunity to respond to those rejections, we may be unable to overcome such rejections. In addition, in the USPTO and in comparable agencies in many foreign jurisdictions, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks.
Our stock price may also decline as a result of unexpected clinical trial results in one or more of our ongoing or future clinical trials. We may require substantial additional funding in the future to meet our financial needs and to pursue our business objectives.
Our stock price may also decline as a result of unexpected clinical trial results in one or more of our ongoing or future clinical trials. 32 We may require substantial additional funding in the future to meet our financial needs and to pursue our business objectives.
Physicians may be reluctant to add AMX0035 or another product to their patients’ treatment regimen, or may cease to add AMX0035 or such product to their patients’ treatment regimen. Further, patients often acclimate to the treatment regime they are currently taking and do not want to add additional treatments unless their physicians recommend it.
Physicians may be reluctant to add avexitide, AMX0035 or another product to their patients’ treatment regimen, or may cease to add avexitide, AMX0035 or such product to their patients’ treatment regimen. Further, patients often acclimate to the treatment regime they are currently taking and do not want to add additional treatments unless their physicians recommend it.
We may also experience numerous unforeseen events during our clinical trials that could delay or prevent our ability to receive marketing approval or commercialize AMX0035 or any other current or future product candidates we develop, including: • regulators, or institutional review boards, or IRBs, or other reviewing bodies may not authorize us or our investigators to commence a clinical trial, or to conduct or continue a clinical trial at a prospective or specific trial site; • we may not reach agreement on acceptable terms with prospective contract research organizations, or CROs, and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; • the number of subjects or patients required for clinical trials of AMX0035 in an indication or any future product candidate may be larger than we anticipate, enrollment in these clinical trials may be insufficient or slower than we anticipate, and the number of clinical trials being conducted at any given time may be high and result in fewer available patients for any given clinical trial, or patients may drop out of these clinical trials at a higher rate than we anticipate; • our third-party contractors, including those manufacturing AMX0035 or any other current or future product candidates or conducting clinical trials on our behalf, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • we may have to amend clinical trial protocol submitted to regulatory authorities or conduct additional studies to reflect changes in regulatory requirements or guidance, which we may be required to resubmit to an IRB and regulatory authorities for re-examination; • unforeseen safety events may occur during the course of a clinical trial and these events may result in the temporary suspension or termination of a clinical trial, or require urgent safety measures or restrictions to protect human subjects during the conduct of a clinical trial; • regulators, IRBs or other reviewing bodies may fail to approve or subsequently find fault with the manufacturing processes or facilities of third-party manufacturers with which we enter into agreement for clinical and commercial supplies, or the supply or quality of AMX0035 or any other current or future product candidate or other materials necessary to conduct clinical trials of AMX0035 or any other current or future product candidates may be insufficient, inadequate or not available at an acceptable cost, or we may experience interruptions in supply; and • the potential for approval policies or regulations of Health Canada, the FDA, the EMA or any other applicable foreign regulatory agencies to significantly change in a manner rendering our clinical data insufficient for approval.
We may also experience numerous unforeseen events during our clinical trials that could delay or prevent our ability to receive marketing approval or commercialize avexitide, AMX0035 or any other current or future product candidates we develop, including: • regulators, or institutional review boards, or IRBs, or other reviewing bodies may not authorize us or our investigators to commence a clinical trial, or to conduct or continue a clinical trial at a prospective or specific trial site; • we may not reach agreement on acceptable terms with prospective contract research organizations, or CROs, and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites; • the number of subjects or patients required for clinical trials of avexitide, AMX0035 in an indication or any future product candidate may be larger than we anticipate, enrollment in these clinical trials may be insufficient or slower than we anticipate, and the number of clinical trials being conducted at any given time may be high and result in fewer available patients for any given clinical trial, or patients may drop out of these clinical trials at a higher rate than we anticipate; • our third-party contractors, including those manufacturing avexitide, AMX0035 or any other current or future product candidates or conducting clinical trials on our behalf, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • we may have to amend clinical trial protocol submitted to regulatory authorities or conduct additional studies to reflect changes in regulatory requirements or guidance, which we may be required to resubmit to an IRB and regulatory authorities for re-examination; • unforeseen safety events may occur during the course of a clinical trial and these events may result in the temporary suspension or termination of a clinical trial, or require urgent safety measures or restrictions to protect human subjects during the conduct of a clinical trial; • regulators, IRBs or other reviewing bodies may fail to approve or subsequently find fault with the manufacturing processes or facilities of third-party manufacturers with which we enter into agreement for clinical and commercial supplies, or the supply or quality of avexitide, AMX0035 or any other current or future product candidate or other materials necessary to conduct clinical trials of avexitide, AMX0035 or any other current or 40 future product candidates may be insufficient, inadequate or not available at an acceptable cost, or we may experience interruptions in supply; and • the potential for approval policies or regulations of the FDA or any other applicable foreign regulatory agencies to significantly change in a manner rendering our clinical data insufficient for approval.
If we experience delays in obtaining approval or if we fail to maintain or obtain approval of AMX0035 or of any product candidates we may develop, the commercial prospects for those product candidates, including for AMX0035, may be harmed, and our ability to generate revenues will be materially impaired.
If we experience delays in obtaining approval or if we fail to maintain or obtain approval of avexitide, AMX0035 or of any product candidates we may develop, the commercial prospects for those product candidates, including for avexitide or AMX0035, may be harmed, and our ability to generate revenues will be materially impaired.
Should we have to conduct comparability testing to bridge earlier clinical data obtained from product candidates produced under earlier manufacturing methods or formulations with the planned commercial 78 formulation, regulatory authorities may disagree on the interpretation of results from this testing.
Should we have to conduct comparability testing to bridge earlier clinical data obtained from product candidates produced under earlier manufacturing methods or formulations with the planned commercial formulation, regulatory authorities may disagree on the interpretation of results from this testing.
However, we may focus on or pursue one or more of our target indications over other potential indications and product candidates and such development efforts may not be successful, which would cause us to delay the clinical development and approval of AMX0035, and other product candidates.
However, we may focus on or pursue one or more of our target indications over other potential indications and product candidates and such development efforts may not be successful, which would cause us to delay the clinical development and approval of avexitide, AMX0035 and other product candidates.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe have established a process to review and assess major software vendors’ security practices prior to onboarding, which includes review of the vendors’ responses to cybersecurity questionnaires and security audit reports and certifications, as applicable. Our process also includes contractual requirements for major vendors that process data on our behalf to maintain data protection safeguards.
Biggest changeWe have established a process to review and assess vendors’ security posture and practices prior to their onboarding. Vendors that access, store or process our data are required to respond to a cybersecurity questionnaire and provide applicable security audit reports and certifications.
We engage a third-party to conduct a cybersecurity risk assessment on an annual basis, which is informed by the National Institute of Standards and Technology (NIST) Cybersecurity Framework. We have established a process for our IT security team to track and quantify known IT security risks and our remediation efforts through a cybersecurity risk register.
We engage a third-party to conduct a cybersecurity risk assessment on an annual basis, which is informed by the National Institute of Standards and Technology, or NIST Cybersecurity Framework. We have established a process for our IT security team to track and quantify known IT security risks and our remediation efforts through a cybersecurity risk register.
Governance of Cybersecurity Risks Our board of directors is responsible for the general oversight of cybersecurity risks and is informed of key updates to our cybersecurity processes by our audit committee and relevant members of our executive leadership team on at least an annual basis.
Governance of Cybersecurity Risks Our board of directors is responsible for the general oversight of cybersecurity risks and is informed of key updates to our cybersecurity processes by relevant members of our executive leadership team on at least an annual basis.
The Head of Global ISGA maintains a Certified Information Systems Security Professionals, or CISSP, certification and has approximately two decades of IT security management experience. The IT security team is supported by external 113 vendors that provide managed services for network support, security operations and other IT areas as needed.
The Head of Global ISGA maintains a Certified Information Systems Security Professionals, or CISSP, certification and has more than two decades of IT security management experience. The IT security team is supported by external vendors that provide managed services for network support, security operations and other IT areas as needed.
Our audit committee and members of our executive leadership team meet with our Head of Global Information Technology on a quarterly basis, along with other members of our IT security team from time to time, to discuss cybersecurity matters, such as the emerging cybersecurity threat landscape, significant developments to our cybersecurity processes, and our cybersecurity risk assessments.
Our executive leadership team meets with our Head of Global Information Technology, along with other members of our IT security team as needed, to discuss cybersecurity matters, such as the emerging cybersecurity threat landscape, significant developments to our cybersecurity processes, and our cybersecurity risk assessments.
Our cybersecurity risk management strategy includes various policies and components, including cybersecurity assessments, an incident response plan, evaluation of the security practices of our key vendors, and cybersecurity awareness training for our staff. We also leverage third-party technology and security tools and solutions, including alerting and monitoring tools, to support our cybersecurity program.
Our cybersecurity risk management strategy includes various policies and components, including cybersecurity assessments, an incident response plan, evaluation of the security practices of our key vendors, and cybersecurity awareness training for our staff.
Our IT security team, led by the Head of Global Information Security, Governance and Architecture (“Head of Global ISGA”), is responsible for managing and directing the day-to-day information security strategy of the organization, including oversight of our cybersecurity tools, controls and strategies to protect organization assets, networks and data.
Furthermore, significant cybersecurity matters, and strategic risk management decisions are escalated to the Board of Directors, as needed, to provide oversight and guidance on critical cybersecurity issues. 90 Our IT security team, led by the Head of Global Information Security, Governance and Architecture (“Head of Global ISGA”), is responsible for managing and directing the day-to-day information security strategy of the organization, including oversight of our cybersecurity tools , controls and strategies to protect organization assets, networks and data.
Item 1C. Cybersecurity. Risk Management and Strategy We recognize that cybersecurity threats have been increasing in number and severity in the general marketplace and in our industry. In an effort to address these threats, we maintain a cybersecurity risk management strategy that is designed to identify, assess, and manage cybersecurity risks to our business.
Item 1C. Cybersecurity. Risk Management and Strategy We recognize that cybersecurity threats have been increasing in number and severity in the general marketplace and in our industry.
We maintain a security awareness training program for employees, which is provided during onboarding. We also provide additional mandatory trainings, including phishing training, throughout the year. We face a number of cybersecurity risks in connection with our business.
Our process also includes contractual requirements to maintain data protection safeguards for vendors that process data on our behalf. We maintain a security awareness training program for employees, which is provided through digital microlearning assignments. We also provide additional mandatory trainings, including phishing training, throughout the year.
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In an effort to address the threat landscape, we maintain a cybersecurity risk management strategy that is designed to identify, assess, manage, and address cybersecurity threats that may have a material impact on our business.
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We maintain a Written Information Security Program, or WISP, that defines our organization’s cybersecurity policies and procedures. This covers all aspects of cybersecurity, including but not limited to risk management, third party security assessments, security awareness training, acceptable use, endpoint security, patch management, log management, backup and recovery. We face a number of cybersecurity risks in connection with our business.
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Senior management is thus kept abreast of the cybersecurity posture and potential risks facing our company. Our cybersecurity incident response process is designed to proactively triage, contain, investigate, mitigate and correct all incidents at the direction of the Head of Global Information Technology.
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Critical incidents are assessed for materiality, and escalated to the executive leadership team for awareness, direction and approval as needed.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeDetails of our principal properties as of December 31, 2023, are provided below: Property Description Location Square Footage Property Interest Initial Lease Term End Date Office space Cambridge, Massachusetts 8,850 Leased October 2026 Office space Cambridge, Massachusetts 24,400 Leased July 2025 We believe that our facilities are adequate for our current needs and that suitable additional or substitute space would be available if needed.
Biggest changeDetails of our principal properties as of December 31, 2024, are provided below: Property Description Location Square Footage Property Interest Initial Lease Term End Date Office space Cambridge, Massachusetts 8,850 Leased October 2026 Office space Cambridge, Massachusetts 24,400 Leased July 2025 Office space Cambridge, Massachusetts 15,267 Leased December 2030 We believe that our facilities are adequate for our current needs and that suitable additional or substitute space would be available if needed.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe Shih Complaint alleges that defendants made materially false and misleading statements related to the commercial results and prospects for RELYVRIO. The Shih Complaint seeks unspecified damages, interest, costs and attorneys’ fees, and other unspecified relief that the court deems appropriate. The Company intends to defend against the Shih Complaint vigorously. Item 4. Mine Safety Disclosures.
Biggest changeThe Shih Complaint alleges that defendants made materially false and misleading statements related to the commercial results and prospects for RELYVRIO. The Shih Complaint seeks unspecified damages, interest, costs and attorneys’ fees, and other unspecified relief that the court deems appropriate. On August 12, 2024, the case was transferred from the U.S.
Item 3. Legal Proceedings. On February 9, 2024, a putative class action lawsuit was filed in the U.S. District Court for the Southern District of New York against our Company and certain of our current and former officers ( Shih v. Amylyx Pharmaceuticals, Inc., et al. , Case Number 1:24-CV-00988 (the “Shih Complaint”)).
Item 3. Legal Proceedings. On February 9, 2024, a putative class action lawsuit was filed in the U.S. District Court for the Southern District of New York against us and certain of our current and former officers ( Shih v. Amylyx Pharmaceuticals, Inc., et al. , Case Number 1:24-CV-00988, or the Shih Complaint).
The Shih Complaint asserts a claim against all defendants for alleged violations of Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder and a claim under Section 20(a) against certain current and former officers as alleged controlling persons.
Plaintiff filed an amended complaint on June 24, 2024. The Shih Complaint asserts a claim against all defendants for alleged violations of Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder and a claim under Section 20(a) against certain current and former officers as alleged controlling persons.
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District Court for the Southern District of New York to the U.S. District Court for the District of Massachusetts, or the Court, and assigned docket number 1:24-CV-12068. Following the transfer, on September 6, 2024, defendants moved to dismiss the Shih Complaint.
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Plaintiff filed his opposition to defendants’ motion to dismiss on October 21, 2024 and defendants filed their reply brief in further support of their motion to dismiss on November 20, 2024. In addition to the Shih Complaint, on October 2, 2024, a derivative complaint was filed in the U.S.
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District Court for the District of Massachusetts against certain current and former director and officer defendants, or the Individual Defendants, naming us as a nominal defendant ( Jones v. Cohen, et al ., 1:24-CV-12527, or the Derivative Complaint).
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The substantive allegations mirror those of the Shih Complaint but also include claims for alleged violations of Section 14(a) of the Exchange Act, breach of fiduciary duty, insider trading, and unjust enrichment against the Individual Defendants.
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The Derivative Complaint seeks unspecified damages to be awarded to the Company along with interest, restitution, unspecified corporate governance and internal procedural reforms and improvements, and plaintiff's attorneys' fees and costs.
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On October 31, 2024, the Court entered an order staying the action until the earlier of the dismissal of the Shih Complaint with prejudice, including the exhaustion of all appeals, or defendants file an answer to the Shih Complaint. We intend to defend against the Shih Complaint and Derivative Complaint vigorously.
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At this time, an estimate of the impact, if any, of the claims made in the Shih Complaint and Derivative Complaint cannot be made. 91 Item 4. Mine Safety Disclosures. Not Applicable. 92 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers We did not purchase any of our registered equity during the period covered by this Annual Report.
Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers We did not purchase any of our registered equity during the period covered by this Annual Report. Unregistered Sales of Securities During the year ended December 31, 2024, we did not issue or sell any unregistered securities. Item 6. [Reserved ] 93
Holders of Record As of February 12, 2024, we had approximately 21 holders 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 February 28, 2025, we had approximately 17 holders 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.
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Unregistered Sales of Securities During the year ended December 31, 2023, we did not issue or sell any unregistered securities. 115 Stock Performance Graph The following graph compares the performance of our Common Stock for the periods indicated with the performance of the Nasdaq Composite Index and the Nasdaq Biotechnology Index.
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This graph assumes an investment of $100 after the market closed on January 7, 2022 in our common stock and the Nasdaq Composite Index and the Nasdaq Biotechnology Index, and assumes reinvestment of dividends, if any. The stock price performance shown on the graph below is not necessarily indicative of future stock price performance.
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This graph is not “soliciting material,” is not deemed “filed” with the SEC and is not to be incorporated by reference into any of our filings under the Securities Act, or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing. Item 6. [Reserved ] 116

Item 7. Management's Discussion & Analysis

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

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Biggest changeOur expenses will also increase as we: • continue our research and development efforts, including our ongoing Phase 3 trial of AMX0035 in PSP and our ongoing Phase 2 trial of AMX0035 for the treatment of WS; • continue to develop AMX0114, antisense oligonucleotide, for the treatment of people living ALS; • continue to commercialize AMX0035 (also known as ALBRIOZA in Canada and RELYVRIO in the U.S.) for the treatment of ALS in Canada and the U.S., and pursue launch of AMX0035 in other jurisdictions, if approved; • pursue INDs of AMX0035 for additional indications; • conduct preclinical studies and clinical trials for AMX0035 for additional indications and for potential future product candidates; • seek to identify and develop, acquire or in-license additional product candidates; • experience any delays or encounter any issues with any of the above, including but not limited to failed studies, complex results, safety issues, or other regulatory challenges; • develop the necessary processes, controls and manufacturing data to obtain additional marketing approval for AMX0035 or approval for any future product candidates and to support manufacturing on a commercial scale; • seek additional regulatory approvals for AMX0035 or approvals for any future product candidates that successfully complete clinical trials, if any; • hire and retain additional personnel, such as preclinical, clinical, quality assurance, regulatory affairs, manufacturing, distribution, legal, compliance, finance, general and administrative, commercial and scientific personnel; and • develop, maintain, expand and protect our intellectual property portfolio. 125 Because of the numerous risks and uncertainties associated with research, development and commercialization of product candidates and programs, we are unable to estimate the exact amount of our working capital requirements.
Biggest changeWe expect to incur significant expenses as we: • continue our research and development efforts of avexitide in PBH, or any other indications, and conduct clinical trials of avexitide; • continue our research and development efforts of AMX0035, including our ongoing Phase 2b/3 trial of AMX0035 in PSP and our ongoing Phase 2 trial of AMX0035 for the treatment of Wolfram syndrome; • continue to develop AMX0114, our antisense oligonucleotide, for the treatment of people living ALS; • pursue INDs of AMX0035 for additional indications; • conduct preclinical studies and clinical trials for AMX0035 for additional indications and for potential future product candidates; • seek to identify and develop, acquire or in-license additional product candidates; 100 • experience any delays or encounter any issues with any of the above, including but not limited to failed studies, complex results, safety issues, or other regulatory challenges; • develop the necessary processes, controls and manufacturing data to obtain marketing approval for current or future product candidates and to support manufacturing on a commercial scale; • seek regulatory approvals for any current or future product candidates that successfully complete clinical trials, if any; • incur expenses in preparation for commercialization for any approved product candidates related to product sales, marketing, manufacturing, and distribution; • hire and retain additional personnel, such as preclinical, clinical, quality assurance, regulatory affairs, manufacturing, distribution, legal, compliance, finance, general and administrative, commercial and scientific personnel; and • develop, maintain, expand and protect our intellectual property portfolio.
This process involves reviewing open contracts and purchase orders, communicating with our personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of actual costs.
This process involves reviewing open contracts and purchase orders, communicating 103 with our personnel to identify services that have been performed on our behalf and estimating the level of service performed and the associated cost incurred for the service when we have not yet been invoiced or otherwise notified of actual costs.
In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the 129 performance of services or the level of effort varies from the estimate, we adjust the accrual or the amount of prepaid expenses accordingly.
In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from the estimate, we adjust the accrual or the amount of prepaid expenses accordingly.
Product candidates such as AMX0035 in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, such as AMX0114, primarily due to the increased size and duration of later-stage clinical trials and related product manufacturing expenses.
Product candidates such as avexitide and AMX0035 in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, such as AMX0114, primarily due to the increased size and duration of later-stage clinical trials and related product manufacturing expenses.
Net cash used in our operating assets and liabilities primarily consisted of a $21.6 million increase in accrued expenses, a $15.9 million increase in accounts payable and a $1.8 million decrease in operating lease right-of-use assets.
Net cash used in our operating assets and liabilities in 2023 primarily consisted of a $21.6 million increase in accrued expenses, a $15.9 million increase in accounts payable and a $1.8 million decrease in operating lease right-of-use assets.
Our inability to raise capital as and when needed could have a negative impact on our financial condition and ability to pursue our business strategies. There can be no assurances that our current operating plan will be achieved or that additional funding, if required, will be available on terms acceptable to us, or at all.
Our inability to raise capital or secure other funding as and when needed could have a negative impact on our financial condition and ability to pursue our business strategies. There can be no assurances that our current operating plan will be achieved or that additional funding, if required, will be available on terms acceptable to us, or at all.
Such amounts are recognized as an expense as the goods are delivered or the related services are performed, or until it is no longer expected that the goods will be delivered, or the services rendered. Certain of our indirect research and development expenses are not tracked on an indication-by-indication basis for AMX0035.
Such amounts are recognized as an expense as the goods are delivered or the related services are performed, or until it is no longer expected that the goods will be delivered, or the services rendered. Certain of our indirect research and development expenses are not tracked on an indication-by-indication basis.
These GTN adjustments involve significant estimates and judgment after considering historical experience, payer channel mix (e.g., Medicare or Medicaid), current contract prices under applicable programs, unbilled claims and processing time lags and inventory levels in the distribution channel. Estimates are assessed each period and adjusted as required to revise information or actual experience.
These GTN adjustments involve significant estimates and judgment, considering historical experience, payer channel mix (e.g., Medicare or Medicaid), current contract prices under applicable programs, unbilled claims and processing time lags and inventory levels in the distribution channel. Estimates were assessed each period and adjusted as required to revise information or actual experience.
At this time, we cannot accurately 119 estimate or know the nature, timing and costs of the efforts that will be necessary to complete the clinical development of AMX0035 and any future product candidates.
At this time, we cannot accurately estimate or know the nature, timing and costs of the efforts that will be necessary to complete the clinical development of avexitide, AMX0035 and any future product candidates.
Investing Activities During the year ended December 31, 2023, net cash provided by investing activities was $92.1 million resulting from $394.1 million of investments matured during the period offset by $300.8 million in purchases of short-term investments and $1.2 million in purchases of property and equipment.
During the year ended December 31, 2023, net cash provided by investing activities was $92.1 million resulting from $394.1 million of investments matured during the period offset by $300.8 million in purchases of marketable securities and $1.2 million in purchases of property and equipment.
These expenses include: • expenses incurred under agreements with CROs, contract manufacturing organizations, or CMOs, as well as investigative sites and consultants that conduct our clinical trials, preclinical studies and other scientific development services; • manufacturing scale-up expenses and the cost of acquiring and manufacturing drug product for our preclinical studies and clinical trials, including manufacturing registration and validation batches, as well as pre-commercial manufacturing activities; • expenses to acquire technologies to be used in research and development; • employee-related expenses, including salaries, payroll taxes, related benefits and stock-based compensation expense for employees engaged in research and development functions; and • costs related to compliance with quality and regulatory requirements.
These expenses include: • expenses incurred under agreements with CROs, contract manufacturing organizations, or CMOs, as well as investigative sites and consultants that conduct our clinical trials, preclinical studies and other scientific development services; • manufacturing scale-up expenses and the cost of acquiring and manufacturing drug product for our preclinical studies and clinical trials, including manufacturing registration and validation batches, as well as pre-commercial manufacturing activities; • expenses to acquire technologies to be used in research and development; • employee-related expenses, including salaries, payroll taxes, related benefits and stock-based compensation expense for employees engaged in research and development functions; and • costs related to compliance with quality and regulatory requirements. 95 Advance payments that we make for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses.
The successful development and commercialization of AMX0035 and any other current or future product candidates is highly uncertain, due to the numerous risks and uncertainties associated with product development and commercialization, including the following: • the timing and progress of preclinical and clinical development activities; • the number and scope of preclinical and clinical trials for separate indications we decide to pursue; • raising additional funds, if necessary; • the progress of the development efforts of parties with whom we may enter into collaboration arrangements; • our ability to maintain our current development activities and to establish new ones; • our ability to establish new licensing or collaboration arrangements; • the successful initiation and completion of clinical trials with safety, tolerability and efficacy profiles that are satisfactory to Health Canada, the FDA or the EMA, or any other comparable foreign regulatory authority; • the successful implementation and compliance with the terms of regulatory approvals from applicable regulatory authorities, including our marketing authorization with conditions from Health Canada for ALBRIOZA and the post-marketing requirements from the FDA for RELYVRIO; • the successful receipt and related terms of regulatory approval for AMX0035 for the treatment of ALS, if approved in the future by the European Commission; • the availability of drug substance and drug product for use in production of AMX0035; • establishing and maintaining agreements with third-party manufacturers for clinical supply for our clinical trials and commercial manufacturing; • our ability to obtain and maintain patents, trade secret protection and regulatory exclusivity, both in the U.S. and internationally; • our ability to protect our rights in our intellectual property portfolio; 120 • the successful commercialization of ALBRIOZA in Canada and RELYVRIO in the U.S. of AMX0035 in other potential jurisdictions, if and when approved; • obtaining and maintaining third-party insurance coverage and adequate reimbursement; • the acceptance of our products and product candidates, if approved, by patients, the medical community and third-party payors; • competition with other product; and • a continued acceptable safety profile of our therapies in pre-approval market access programs or in commercial access following approval.
The successful development and commercialization of avexitide, AMX0035 and any other current or future product candidates is highly uncertain, due to the numerous risks and uncertainties associated with product development and commercialization, including the following: • the timing and progress of preclinical and clinical development activities; • the number and scope of preclinical and clinical trials for separate indications we decide to pursue; • raising additional funds, if necessary; • the progress of the development efforts of parties with whom we may enter into collaboration arrangements; • our ability to maintain our current development activities and to establish new ones; • our ability to establish new licensing or collaboration arrangements; 96 • the successful initiation and completion of clinical trials with safety, tolerability and efficacy profiles that are satisfactory to the FDA or any other comparable foreign regulatory authority; • the availability of drug substance and drug product for use in production of avexitide, AMX0035 or other product candidates; • establishing and maintaining agreements with third-party manufacturers for clinical supply for our clinical trials; • our ability to obtain and maintain patents, trade secret protection and regulatory exclusivity, both in the U.S. and internationally; • our ability to protect our rights in our intellectual property portfolio; • obtaining and maintaining third-party insurance coverage and adequate reimbursement in the future for any approved products; • the acceptance of our products and product candidates, if approved, by patients, the medical community and third-party payors; • competition with other products; and • a continued acceptable safety profile of our therapies in pre-approval market access programs or in commercial access following approval.
As of December 31, 2023, we have funded our operations primarily through public offerings of our common stock, private sales of preferred stock, convertible notes, and more recently through revenue from sales of RELYVRIO and ALBRIOZA in the U.S. and Canada, respectively.
As of December 31, 2024, we have funded our operations primarily through public offerings of our common stock, private sales of preferred stock, convertible notes, and through revenue from sales of RELYVRIO and ALBRIOZA in the U.S. and Canada, respectively between July 2022 and April 2024.
We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect.
We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect.
Our future funding requirements will depend on and could increase significantly as a result of many factors, including: • the scope, progress, results and costs of drug discovery, laboratory testing, preclinical and clinical development for AMX0035 and any future product candidates; • the costs, timing and outcome of commercialization activities, including manufacturing, marketing, sales and distribution for AMX0035 in the U.S. and Canada, and, if approved, in the EU and other territories or for any future product candidates for which we receive regulatory approval; • the costs, timing and outcome of regulatory review of AMX0035 and any future product candidates; • our ability to establish and maintain collaborations, marketing, distribution and license agreements on favorable terms, if at all; • our ability to enroll clinical trials in a timely manner and to quickly resolve any delays or clinical holds that may be imposed on our development activities; • timing delays with respect to preclinical and clinical development of AMX0035 and any future product candidates, including as result of any future outbreak of any highly infectious or contagious diseases; • the costs of expanding our facilities to accommodate our expected growth in personnel, and the costs of such additional personnel; • the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims; • the extent to which we acquire technologies or other assets; • the sales price and availability of adequate third-party coverage and reimbursement for AMX0035 and any future product candidates, if and when approved; and • the costs of operating as a public company.
Our future funding requirements will depend on and could increase significantly as a result of many factors, including: • the scope, progress, results and costs of drug discovery, laboratory testing, preclinical and clinical development for avexitide, AMX0035 and any future product candidates; • the costs, timing and outcome of any future commercialization activities, including manufacturing, marketing, sales and distribution costs; • the costs, timing and outcome of regulatory review of avexitide, AMX0035 and any future product candidates; • our ability to establish and maintain collaborations, marketing, distribution and license agreements on favorable terms, if at all; • our ability to enroll clinical trials in a timely manner and to quickly resolve any delays or clinical holds that may be imposed on our development activities; • timing delays with respect to preclinical and clinical development of avexitide, AMX0035 and any future product candidates, including as result of any future outbreak of any highly infectious or contagious diseases; • costs associated with identifying and developing, acquiring or in-licensing additional product candidates or products; • the costs of any future expansion of our facilities to accommodate our potential growth in personnel, and the costs of such additional personnel; • the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims; • the extent to which we acquire technologies or other assets; • the sales price and availability of adequate third-party coverage and reimbursement for any future product candidates, if and when approved; • the costs of current and potential legal proceedings that may not be covered by our insurance; and • the costs of operating as a public company. 101 Until such time, if ever, that we can generate product revenue sufficient to sustain profitability, we may finance our cash needs through equity offerings, debt financings, government or other third-party funding, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements.
Critical Accounting Policies and Significant Judgments and Estimates Our consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, costs and expenses, and the disclosure of contingent assets and liabilities in our consolidated financial statements.
The preparation of our consolidated financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, costs and expenses, and the disclosure of contingent assets and liabilities in our consolidated financial statements.
Research and Development Expenses Research and development expenses consist primarily of costs incurred in connection with the research and development of AMX0035. We expense research and development costs as incurred.
Research and Development Expenses Research and development expenses consist primarily of costs incurred in connection with the research and development of avexitide, AMX0035, AMX0114 and other potential future product candidates. We expense research and development costs as incurred.
This amount consisted of $7.0 million of proceeds from exercises of stock options, offset by $3.3 million of withholding taxes paid on stock-based awards and $0.1 million in payments of deferred offering costs. 127 During the year ended December 31, 2022, net cash provided by financing activities was $431.8 million.
Financing Activities During the year ended December 31, 2024, net cash provided by financing activities was $0.3 million. This amount consisted of $2.1 million of proceeds from exercises of stock options, offset by $1.8 million of withholding taxes paid on stock-based awards. During the year ended December 31, 2023, net cash provided by financing activities was $3.5 million.
During the year ended December 31, 2022, operating activities used $179.9 million of cash, primarily resulting from our net loss of $198.4 million and net amortization of premiums and discounts on investments of $2.1 million, offset by $21.7 million of non-cash stock-based compensation expense, $0.5 million of depreciation expense and a $1.6 million increase in net cash used in our operating assets and liabilities.
During the year ended December 31, 2023, operating activities provided $11.9 million of cash, primarily resulting from our net income of $49.3 million, non-cash stock-based compensation expense of $37.2 million and $1.1 million of depreciation expense, offset by an increase of $65.7 million in net cash used in our operating assets and liabilities and net amortization of premiums and discounts on investments of $9.9 million.
A change in the outcome of any of these variables with respect to the development of AMX0035 or any future product candidates could have a significant impact on the cost and timing associated with the development of our product candidates. We may never succeed in obtaining or maintaining, as applicable, regulatory approval for AMX0035 or any future product candidates.
A change in the outcome of any of these variables with respect to the development of avexitide, AMX0035 or any other current or future product candidates could have a significant impact on the cost and timing associated with the development of our product candidates.
In addition, we expect to incur additional costs associated with operating as a public company, including significant legal, accounting, investor relations and other expenses.
We may also incur expenses related to business development activities, such as in-licensing or acquisition of product candidates. In addition, we expect to incur additional costs associated with operating as a public company, including significant legal, accounting, investor relations and other expenses.
Recently Issued Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our consolidated financial statements. 130
To date, there have not been any material adjustments to our prior estimates of accrued research and development expenses. Recently Issued Accounting Pronouncements A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2 to our consolidated financial statements. 104
We continue to maintain a full valuation allowance against all of our U.S. deferred tax assets as of December 31, 2023 based on management’s evaluation of all available evidence, including our history of incurring significant losses from operations.
We evaluate and adjust these costs as appropriate for changes in circumstances as additional information becomes available. Income Taxes We have historically not incurred significant income taxes. We continue to maintain a full valuation allowance against all of our deferred tax assets based on management’s evaluation of all available evidence, including our history of incurring significant losses from operations.
The Company has received an immaterial amount of returns to date and believe that returns of product in future periods will be minimal. Accrued Research and Development Expenses As part of the process of preparing our consolidated financial statements, we are required to estimate our accrued research and development expenses.
Accrued Research and Development Expenses As part of the process of preparing our consolidated financial statements, we are required to estimate our accrued research and development expenses.
Selling, General and Administrative Expenses Selling, general and administrative expenses consist primarily of salaries and related costs for personnel in executive, finance, sales, marketing, as well as administrative functions.
We may never succeed in obtaining or maintaining, as applicable, regulatory approval for avexitide, AMX0035 or any other current or future product candidates. Selling, General and Administrative Expenses Selling, general and administrative expenses consist primarily of salaries and related costs for personnel in executive, finance, sales, marketing, as well as administrative functions.
We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. Impact of Macroeconomic Factors The development of AMX0035 and any future product candidates could be disrupted and materially adversely affected in the future by any pandemic or calamity.
We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect.
We expect that our research and development expenses will continue to increase in connection with our planned clinical development activities in the near term and in the future and to fund commercialization activities in the U.S., Canada and any other jurisdictions in which AMX0035 is approved.
Despite a decline in research and development expenses in 2024 compared to 2023, we expect that our research and development expenses will increase in connection with our planned clinical development activities in the near term and in the future.
Until such time as we can generate sufficient revenue from product sales to sustain profitability, we expect to finance our operations through the sale of equity, debt financings or other capital sources, including potential collaborations with other companies, royalty financings, or other strategic transactions.
We expect to finance our near-term operations through our existing cash, cash equivalents and marketable securities and if needed, the sale of equity, debt financings or other capital sources, including potential collaborations with other companies, royalty financings, or other strategic transactions.
Capital Resources We expect our expenses to increase in connection with our ongoing activities, particularly as we advance the preclinical activities, manufacturing and clinical trials of AMX0035 and any other current or future product candidates, execute on our commercialization plans for ALBRIOZA in Canada and RELYVRIO in the U.S., and prepare for the commercial launch of AMX0035 in other jurisdictions, if approved.
Capital Resources Despite the decline in research and development and general administrative expenses in 2024 as compared to 2023, we expect our expenses to increase in connection with our ongoing activities, particularly as we advance the preclinical activities, manufacturing and clinical trials of avexitide, AMX0035 and any other current or future product candidates or acquire or in-license additional product candidates or products.
Revenue Recognition Our accounting policy for revenue recognition has a substantial impact on reported results and relies on certain estimates. Revenue is recognized following a five-step model under ASC Topic 606 - Revenue from Contracts with Customers , or Topic 606. Revenue is also reduced by variable consideration related to certain gross-to-net, or GTN, adjustments discussed below.
Revenue Recognition Prior to the RELYVRIO®/ALBRIOZA™ Discontinuation, our accounting policy for revenue recognition had a substantial impact on reported results and relied on certain estimates. Specifically, revenue was reduced by variable consideration related to certain gross-to-net, or GTN.
This was offset by a $73.1 million increase in inventories, a $24.7 million increase in accounts receivable, a $4.8 million increase in prepaid expenses and other current assets and a $2.0 million decrease in operating lease liabilities.
This was offset by a $73.1 million increase in inventories, a $24.7 million increase in accounts receivable, a $4.8 million increase in prepaid expenses and other current assets and a $2.0 million decrease in operating lease liabilities. 102 Investing Activities During the year ended December 31, 2024, net cash provided by investing activities was $75.7 million resulting from $344.0 million of investments that matured during the period offset by $232.0 million in purchases of marketable securities and a $36.2 million cash outflow to acquire IPR&D assets related to the Eiger Acquisition.
The increase of $61.2 million was primarily due to increases of $30.2 million in payroll and personnel-related costs, which includes an $11.2 million increase in stock-based compensation, $16.1 million in consulting and professional services and $14.9 million in other expenses.
The decrease was primarily due to a decrease of $39.5 million in payroll and personnel-related costs, $25.5 million in consulting and professional services, and $9.1 million in other expenses. The decrease in payroll and personnel-related costs was primarily related to a decrease in the number of employees as a result of the Restructuring Plan.
The increase of $34.7 million was primarily due to a $16.2 million increase in payroll and personnel-related costs, which includes a $4.2 million increase in stock-based compensation, a $5.4 million increase in spending on AMX0035 for the treatment of PSP, a $4.3 million increase in spending on AMX0035 for the treatment of ALS and a $8.8 million increase in all other costs.
The decrease of $24.1 million was primarily due to a $24.1 million decrease in spending on AMX0035 for the treatment of ALS following topline data from the PHOENIX trial in April 2024, an $8.1 million decrease in payroll and personnel-related costs due to a decrease in the number of employees following the completion of our Restructuring Plan, and a $5.2 million decrease in other costs due to an decrease in preclinical development activities.
Selling, General and Administrative Expenses Selling, general and administrative expenses were $188.4 million for the year ended December 31, 2023 compared to $127.1 million for the year ended December 31, 2022.
The increase in spending on AMX0035 for the treatment of PSP was primarily related to costs to support the continuation of the ORION Phase 2b/3 global clinical trial. Selling, General and Administrative Expenses Selling, general and administrative expenses were $114.3 million for the year ended December 31, 2024 compared to $188.4 million for the year ended December 31, 2023.
We believe that the revenue we generate from commercial sales of AMX0035 in the U.S. and Canada and our existing cash, cash equivalents and short-term investments as of December 31, 2023, will be sufficient to meet our anticipated operating and capital expenditure requirements for at least one year from the date of this Annual Report.
We believe our existing cash, cash equivalents and marketable securities as of December 31, 2024, along with the proceeds from the January 2025 Offering, will be sufficient to meet our anticipated operating and capital expenditure requirements through 2026.
Current year U.S. federal and state taxable income is significantly impacted by a TCJA tax law change in effect from January 1, 2022 that requires capitalization and amortization of all research and experimentation costs under Section 174 of the IRC. 124 Liquidity and Capital Resources Sources of Liquidity In the second half of 2022, we began generating revenue from the sale of our approved drug product RELYVRIO, known as ALBRIOZA in Canada.
We completed the Restructuring Plan in 2024. 99 Liquidity and Capital Resources Sources of Liquidity In the second half of 2022, we began generating revenue from the sale of our approved drug product RELYVRIO, known as ALBRIOZA in Canada. In April 2024, we announced the RELYVRIO®/ALBRIOZA™ Discontinuation.
If we are unable to raise additional funds when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves. 126 Cash Flows Comparison of the Years Ended December 31, 2023 and 2022 The following table summarizes our sources and uses of cash for the years ended December 31, 2023 and 2022: Year Ended December 31, 2023 2022 $ Change % Change (in thousands) Net cash provided by (used in) operating activities $ 11,919 $ (179,871 ) $ 191,790 (107 )% Net cash provided by (used in) investing activities 92,053 (238,988 ) 331,041 (139 )% Net cash provided by financing activities 3,543 431,789 (428,246 ) (99 )% Effect of exchange rate changes on cash, cash equivalents and restricted cash equivalents 160 (65 ) 225 (346 )% Net increase in cash, cash equivalents and restricted cash equivalents $ 107,675 $ 12,865 $ 94,810 737 % Operating Activities During the year ended December 31, 2023, operating activities provided $11.9 million of cash, primarily resulting from our net income of $49.3 million, non-cash stock-based compensation expense of $37.2 million and $1.1 million of depreciation expense, offset by an increase of $65.7 million in net cash used in our operating assets and liabilities and net amortization of premiums and discounts on investments of $9.9 million.
Cash Flows Comparison of the Years Ended December 31, 2024 and 2023 The following table summarizes our sources and uses of cash for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 $ Change % Change (in thousands) Net cash (used in) provided by operating activities $ (167,647 ) $ 11,919 $ (179,566 ) (1,507 )% Net cash provided by investing activities 75,654 92,053 (16,399 ) (18 )% Net cash provided by financing activities 348 3,543 (3,195 ) (90 )% Effect of exchange rate changes on cash, cash equivalents and restricted cash equivalents (438 ) 160 (598 ) (374 )% Net (decrease) increase in cash, cash equivalents and restricted cash equivalents $ (92,083 ) $ 107,675 $ (199,758 ) (186 )% Operating Activities During the year ended December 31, 2024, operating activities used $167.6 million of cash, primarily resulting from our net loss of $301.7 million, offset by non-cash items totaling $179.9 million including $118.7 million of inventory impairment and loss on firm purchase commitments, $33.0 million of non-cash stock-based compensation expense, $9.9 million in accretion of discounts on investments and $36.2 million of acquired IPR&D assets, which are classified as investing activities.
For the years ended December 31, 2023 and 2022, we recorded approximately $380.8 million and $22.2 million of product revenue, net, respectively. The increase is primarily related to RELYVRIO and ALBRIOZA being sold for the entirety of 2023 compared to the majority being sold in the fourth quarter in 2022.
Product revenue, net was related to units of RELYVRIO and ALBRIOZA sold in the U.S. and Canada, respectively, prior to the RELYVRIO®/ALBRIOZA™ Discontinuation. Cost of sales Cost of sales were $124.6 million for the year ended December 31, 2024, compared to $25.4 million for the year ended December 31, 2023.
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Overview Amylyx Pharmaceuticals, Inc. is a commercial-stage biotechnology company with a mission to end the suffering caused by neurodegenerative diseases. We have been working in ALS and neurodegenerative diseases for over a decade and have been making significant progress in transforming the treatment of these diseases.
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Overview We are a clinical-stage pharmaceutical company with a mission to develop novel therapies for communities with high unmet medical needs. We have preclinical and clinical development programs underway in neurodegenerative diseases and endocrine conditions.
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Since our founding in 2013, we have transformed from a research-stage company focused on addressing the needs of patients suffering from neurodegenerative diseases to a commercial enterprise with development programs across several indications.
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We are advancing a pipeline in which we have matched investigational therapies with diseases where they can make the greatest impact, based on well-defined mechanistic rationale, clear clinical outcomes and biomarkers, and rigorous preclinical data, agnostic of modality.
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Our first commercial product, AMX0035 (sodium phenylbutyrate [PB] and taurursodiol [TURSO], also known as RELYVRIO in the U.S. and ALBRIOZA in Canada) is the first and only ALS therapy of which we are aware that has been shown to slow disease progression, help maintain functional independence, and extend overall survival in the same clinical trial, with a generally well-tolerated side effect profile and oral administration.
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We are currently developing three investigational therapies for potential impact across several diseases: avexitide in PBH and congenital HI, AMX0035 in Wolfram syndrome and PSP, and AMX0114 in ALS. As of December 31, 2024, we had cash, cash equivalents and marketable securities of $176.5 million. In January 2025, we received net proceeds of $65.5 million from the January 2025 Offering.
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AMX0035 was commercially launched as RELYVRIO in the U.S. in October 2022 and commercially launched as ALBRIOZA in Canada in July 2022. Since the launch of RELYVRIO and ALBRIOZA through December 31, 2023, we have generated net product revenue of $403.0 million.
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See “Liquidity and Capital Resources” below. 94 Components of Our Results of Operations Product Revenue, Net Product revenue, net recognized during the years ended December 31, 2024 and 2023 relates to units of ALBRIOZA and RELYVRIO sold in Canada and the U.S., respectively.
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We believe AMX0035 has the potential to become a widely-used ALS medication and provides an opportunity to transform ALS from a disease for which symptom management is the standard of care to a disease with meaningful interventions.
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In April 2024, we announced we had started a process with the FDA and Health Canada to voluntarily discontinue the marketing authorizations for RELYVRIO®/ALBRIOZA™ (sodium phenylbutyrate and taurursodiol [also known as ursodoxicoltaurine]; also known as AMX0035) for the treatment of ALS and remove the product from the market in the U.S. and Canada, or the “RELYVRIO®/ALBRIOZA™ Discontinuation.
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In addition, we believe AMX0035 has the potential to be a foundational therapy for neurodegenerative diseases, meaning that it could be used alone or in conjunction with other therapies to change the treatment paradigm across a broad range of neurodegenerative diseases. We are committed to bringing the benefits of AMX0035 to the more than 200,000 people living with ALS worldwide.
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This decision was informed by topline results from the global Phase 3 PHOENIX trial, which failed to meet its prespecified primary and secondary endpoints, engagement with regulatory authorities, and discussions with the ALS community. As a result, we do not expect to generate revenue from the sale of RELYVRIO®/ALBRIOZA™ in future periods.
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We are building a global infrastructure to commercialize AMX0035 in additional jurisdictions where it may be approved and engaging with key stakeholders around the world to explore opportunities for access including the EU and Japan.
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As of April 4, 2024, RELYVRIO/ALBRIOZA was no longer available for new patients. Patients who were currently on therapy in the U.S. and Canada who, in consultation with their physician, wished to stay on treatment had the option to be transitioned to a free drug program.
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We continue to focus on the global PHOENIX Phase 3 clinical trial of AMX0035 for the treatment of ALS, a 48-week, randomized, double-blind, placebo-controlled trial at clinical sites in the U.S. and Europe, and expect to report topline results during or before the second quarter of 2024.
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Patients and their physicians were informed that final shipments of free drug were made to allow treatment through early 2025. The NDA is now on the Discontinued Drug Product List of the Orange Book and we have filed a formal request to withdraw the NDA.
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If the data from PHOENIX are supportive, it will be the first time that two clinical trials have demonstrated a benefit in ALS. We believe that supportive PHOENIX data will further accelerate the commercial launch of AMX0035 and the transformation of the treatment of ALS.
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We have completed the collection of data on survival and we will continue to share any learnings from PHOENIX to help inform future ALS research. We wound down the Open Label Extension as planned.
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In addition to ALS, we believe there is strong scientific rationale to use AMX0035 to treat other neurodegenerative diseases. AMX0035 was designed to slow or mitigate neurodegeneration by targeting ER stress and mitochondrial dysfunction, two connected central pathways that lead to neurodegeneration.
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Operating Expenses Cost of Sales Cost of sales consists primarily of costs associated with the manufacturing of RELYVRIO, ALBRIOZA and certain period costs and losses on purchase commitments with contract manufacturing organizations.
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We believe that our proprietary combination of PB and TURSO and their respective mechanisms of action will allow us to synergistically target abnormal cell death to better prevent neurodegeneration than treatment targeted at either mechanism of action alone. We are actively advancing clinical trials to evaluate AMX0035 in PSP and WS.
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Following our announcement of a process to discontinue the marketing authorizations for RELYVRIO®/ALBRIOZA™ and remove the product from the market in the U.S. and Canada, we did not report product cost of sales following the discontinuation of these products.
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Prior to 2023, we had incurred operating losses and as of December 31, 2023, we had an accumulated deficit of $304.9 million. These losses resulted primarily from costs incurred in connection with research and development activities 117 and selling, general and administrative costs associated with our operations.
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Acquired In-process Research and Development Expenses Acquired in-process research and development, or IPR&D, expenses relate to upfront or other payments pursuant to our business development transactions, including the Eiger Acquisition (as defined below).
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We expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution of our approved products. We may incur significant losses and our financial results will be highly dependent upon our successful commercialization of RELYVRIO in the U.S.
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In April 2024, we announced the Restructuring Plan designed to focus our resources on key clinical and preclinical programs. The restructuring included a reduction in force which reduced our workforce by approximately 70% and a decrease in external financial commitments outside our priority areas. As a result, our selling, general and administrative expenses decreased in 2024 as compared to 2023.
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We will continue to incur significant expenses as we advance AMX0035 and any other current or future product candidates through preclinical and clinical development, set up and initiate additional trials, hire additional clinical, scientific, management and administrative personnel, seek regulatory approval and pursue commercialization of any approved product candidates.
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However, we expect that general and administrative expenses will increase in future periods as we advance our clinical pipeline. Restructuring Expenses Restructuring expenses consists primarily of employee severance and termination benefits, contract termination costs, impairment of long-lived assets and other costs. Such costs are based on estimates of fair value in the period liabilities are incurred.
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To date, we have primarily developed AMX0035 and AMX0114 internally, with assistance from our network of CROs and other advisors. This has resulted in increased research and development spending but has enabled us to manage AMX0035 and AMX0114 efficiently through the development and manufacturing process.
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As a result, we don’t expect to incur material income taxes for the foreseeable future. 97 Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 The following table summarizes our results of operations for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 $ Change % Change (in thousands) Product revenue, net $ 87,371 $ 380,786 $ (293,415 ) (77 )% Operating expenses: Cost of sales 5,953 25,441 (19,488 ) (77 )% Cost of sales - inventory impairment and loss on firm purchase commitments 118,680 — 118,680 *NM Acquired in-process research and development 36,203 — 36,203 *NM Research and development 104,084 128,187 (24,103 ) (19 )% Selling, general and administrative 114,331 188,356 (74,025 ) (39 )% Restructuring expenses 22,851 — 22,851 *NM Total operating expenses 402,102 341,984 60,118 18 % (Loss) income from operations (314,731 ) 38,802 (353,533 ) (911 )% Other income, net: Interest income 13,809 16,155 (2,346 ) (15 )% Other expense, net (1,214 ) (660 ) (554 ) 84 % Total other income, net 12,595 15,495 (2,900 ) (19 )% (Loss) income before income taxes (302,136 ) 54,297 (356,433 ) (656 )% (Benefit) provision for income taxes (393 ) 5,026 (5,419 ) (108 )% Net (loss) income $ (301,743 ) $ 49,271 $ (351,014 ) (712 )% * NM - not meaningful Product revenue, net Product revenue, net was $87.4 million for the year ended December 31, 2024, compared to $380.8 million for the year ended December 31, 2023.
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We also expect to continue to incur additional costs associated with operating as a public company, including significant legal, accounting, investor relations and other expenses. As a result, we may need substantial additional funding to support our continuing operations and pursue our growth strategy.
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Cost of sales consisted of costs to procure, manufacture and distribute our marketed products, RELYVRIO and ALBRIOZA. As a result of the RELYVRIO®/ALBRIOZA™ Discontinuation, we recorded approximately $118.7 million of charges associated with the write-down of inventory and losses on firm purchase commitments for the year ended December 31, 2024.
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As of December 31, 2023, we had cash, cash equivalents and short-term investments of $371.4 million.
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Acquired In-process Research and Development Expenses On July 9, 2024, we completed the acquisition of substantially all the assets and interests in the development, manufacture and commercialization of avexitide, an investigational, first-in-class GLP-1 receptor antagonist, from Eiger, or the Seller, or the Eiger Acquisition.
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In addition, economic uncertainty in various global markets, including in the U.S., Europe and the Middle East, caused by political instability and conflict, such as the ongoing conflicts in Ukraine and Israel, and economic challenges caused by global pandemics or other public health events, have led to market disruptions, including significant volatility in commodity prices, credit and capital market instability and supply chain interruptions, which have caused record inflation globally.
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During the year ended December 31, 2024, we recorded a charge of approximately $36.2 million associated with the acquired in-process research and development assets of avexitide with no alternative future use. 98 Research and Development Expenses The following table summarizes our research and development expenses for the years ended December 31, 2024 and 2023: Year Ended December 31, 2024 2023 $ Change % Change (in thousands) Direct research and development expenses by program: AMX0035 - ALS $ 36,727 $ 60,843 $ (24,116 ) (40 )% AMX0035 - PSP 16,917 6,404 10,513 164 % Avexitide 2,766 — 2,766 *NM Other programs 8,698 13,870 (5,172 ) (37 )% Total direct research and development expenses by program 65,108 81,117 (16,009 ) (20 )% Personnel-related research and development 38,976 47,070 (8,094 ) (17 )% $ 104,084 $ 128,187 $ (24,103 ) (19 )% * NM - not meaningful Research and development expenses were $104.1 million for the year ended December 31, 2024, compared to $128.2 million for the year ended December 31, 2023.
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Our business, financial condition and results of operations could be materially and adversely affected by further negative impact on the global economy and capital markets resulting from these global economic conditions, particularly if such conditions are prolonged or worsen.
Added
The decrease in research and development expenses was offset by a $10.5 million increase in spending on AMX0035 for the treatment of PSP, and a $2.8 million increase in expenses for the development of avexitide following the Eiger Acquisition.
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Although, to date, our business has not been materially impacted by these global economic and geopolitical conditions, it is impossible to predict the extent to which our operations will be impacted in the short and long term, or the ways in which such instability could impact our business and results of operations.
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The decrease in consulting and professional services was primarily due to a decrease in commercial sales and marketing activity as a result of the RELYVRIO®/ALBRIOZA™ Discontinuation. The decrease in other expenses is primarily due to a decrease in charitable contributions. Restructuring Expenses In April 2024, we announced a restructuring to focus our financial resources on upcoming clinical milestones.
Removed
The extent and duration of these market disruptions, whether as a result of the military conflict between Russia and Ukraine and effects of the Russian sanctions, the conflict in Israel, geopolitical tensions, record inflation or otherwise, are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this report.
Added
Under the restructuring, we reduced our workforce by approximately 70% and decreased external financial commitments outside of our priority areas. Restructuring expenses were approximately $22.9 million for the year ended December 31, 2024 which includes employee severance and termination benefits of approximately $21.9 million, contract termination costs, impairment of long-lived assets and other costs of $1.0 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeHowever, inflation has had, and may continue to have, an impact on the labor costs we incur to attract and retain qualified personnel. Item 8 . Financial Statements and Supplementary Data. Our consolidated financial statements, together with the reports of our independent registered public accounting firms, appear beginning on page F-1 of this Annual Report. Item 9 .
Biggest changeOur consolidated financial statements, together with the reports of our independent registered public accounting firms, appear beginning on page F-1 of this Annual Report. Item 9 . Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.
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Item 7A. Quantitative and Qualitative Disclosures about Market Risk. Market risk is the potential loss that may result from market changes associated with our business or with an existing or forecasted financial transactions. We are exposed to various market risks in the ordinary course of our business which are discussed below.
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Item 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.
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Interest Rate Risk We are exposed to market risk related to changes in interest rates. As of December 31, 2023, we had cash, cash equivalents and short-term investments of $371.4 million. Our cash equivalents are invested primarily in bank deposits and money market mutual funds.
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Our primary exposure to market risk is interest rate sensitivity, which is affected by changes in the general level of U.S. interest rates. Our investments are subject to interest rate risk and could fall in value if market interest rates increase.
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Due to the duration of our investment portfolio and the low risk profile of our investments, we do not believe an immediate 100 basis point change in interest rates would have a material effect on the fair market value of our portfolio.
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We have the ability to hold our investments until maturity, and therefore we would not expect our operating results or cash flows to be affected to any significant degree by the effect of a change in market interest rates on our investments.
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Foreign Currency and Currency Translation Risk We are not currently exposed to significant market risk related to changes in foreign currency exchange rates; however, we have contracted with and may continue to contract with vendors that are located outside of the U.S. As a result, our operations may be subject to fluctuations in foreign currency exchange rates in the future.
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In addition, we translate the assets and liabilities of our foreign subsidiaries from their respective functional currencies to U.S. dollars at the appropriate rates as of the balance sheet date. Changes in the carrying value of these assets and liabilities attributable to fluctuations in rates are included in accumulated other comprehensive income (loss) on our consolidated balance sheets.
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Income statement accounts are translated using the monthly average exchange rates during the year. Inflation Risk We do not believe that inflation had a material effect on our business, financial condition, or results of operations during the twelve months ended December 31, 2023 and 2022.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.

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