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What changed in REGENXBIO Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of REGENXBIO 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.

+447 added−415 removedSource: 10-K (2025-03-13) vs 10-K (2024-02-27)

Top changes in REGENXBIO Inc.'s 2024 10-K

447 paragraphs added · 415 removed · 330 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

125 edited+63 added−28 removed251 unchanged
Biggest changeClinical Development of ABBV-RGX‑314 Suprachoroidal Delivery for the Treatment of DR We are evaluating the efficacy, safety and tolerability of suprachoroidal delivery of ABBV-RGX-314 for the treatment of DR in ALTITUDE ® , a multi-center, open label, randomized, controlled, dose-escalation Phase II trial. We have enrolled 79 patients dosed in Cohorts 1-5 at three dose levels.
Biggest changeTwo-year findings from this study were published in The Lancet in March 2024, in a paper titled "Gene therapy for neovascular age-related macular degeneration by subretinal delivery of RGX-314: a phase 1/2a dose-escalation study." Clinical Development of ABBV-RGX‑314 Suprachoroidal Delivery for the Treatment of Wet AMD We are also evaluating the efficacy, safety and tolerability of suprachoroidal delivery of ABBV-RGX-314 through AAVIATE ® , a multi-center, open label, randomized, controlled, dose-escalation Phase II trial of ABBV-RGX-314 for the treatment of wet AMD.
Drug or biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses may be eligible for accelerated approval, which means that they may be approved on the basis of an effect on a surrogate endpoint that is reasonably likely to predict a clinical benefit, or on the basis of an effect on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity or prevalence of the condition and the availability or lack of alternative treatments.
Drug or biological products studied for their safety and effectiveness in treating serious or life-threatening illnesses may be eligible for accelerated approval, which means that they may be approved on the basis of an effect on a surrogate endpoint that is reasonably likely to predict a clinical benefit, or on the basis of an effect on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality or other clinical benefit, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity or prevalence of the condition and the availability or lack of alternative treatments.
Under this Minnesota license agreement, as amended, we receive an exclusive license under the licensed patent rights to make, have made, use, offer to sell or sell, offer to lease or lease, import or otherwise offer to dispose or dispose of products covered by the licensed patent rights in all fields of use in any country or territory in which a licensed patent has been issued and is unexpired or a licensed patent application is pending until November 2019, after which time the field of use would be limited to all fields of use using our NAV Vectors in addition to certain additional indications and areas.
Under this Minnesota license agreement, as amended, we receive an exclusive license under the licensed patent rights to make, have made, use, offer to sell or sell, offer to lease or lease, import or otherwise offer to dispose or dispose of products covered by the licensed patent rights in all fields of use in any country or territory in which a licensed patent has been issued and is unexpired or a licensed patent application is pending until November 2019, after which time the field of use would be limited to all fields of use using 15 our NAV Vectors in addition to certain additional indications and areas.
The grant of marketing authorization in the EU for products containing viable human tissues or cells such as gene therapy medicinal products is governed by Regulation (EC) No 1394/2007 on advanced therapy medicinal products, read in combination with Directive 2001/83/EC on the Community code relating to medicinal products for human use and Regulation (EC) No 726/2004 laying down Community procedures for the authorization and supervision of medicinal products for human and veterinary use and establishing the EMA.
The grant of marketing authorization in the EU for products containing viable human tissues or cells such as gene therapy medicinal products is governed by Regulation (EC) No 1394/2007 on advanced therapy medicinal products, read in combination with Directive 2001/83/EC on the Community code relating to medicinal products for human use and Regulation (EC) No 726/2004 laying 26 down Community procedures for the authorization and supervision of medicinal products for human and veterinary use and establishing the EMA.
These include a national application for a medicinal product, either on a 150-day assessment procedure or on a rolling review basis. From 1 January 2024, the UK has adopted an international recognition procedure which is a route open to applicants that have already received an authorization for the same product from one of the MHRA reference regulators.
These include a national application for a 28 medicinal product, either on a 150-day assessment procedure or on a rolling review basis. From 1 January 2024, the UK has adopted an international recognition procedure which is a route open to applicants that have already received an authorization for the same product from one of the MHRA reference regulators.
These polysaccharides, called glycosaminoglycans (GAGs), accumulate in tissues of MPS II patients, resulting in diverse clinical signs and symptoms. HS is a key biomarker of I2S enzyme activity and high amounts of HS accumulate in the central nervous system (CNS) of MPS II patients, which has been shown to correlate with neurocognitive manifestations of the disease.
These polysaccharides, called glycosaminoglycans (GAGs), accumulate in tissues of MPS II patients, resulting in diverse clinical signs and symptoms. HS is a key biomarker of I2S enzyme activity and high amounts of HS accumulate in the central nervous system (CNS) of neuronopathic MPS II patients, which has been shown to correlate with neurocognitive manifestations of the disease.
In the United States and markets in other countries, sales of any product candidates for which regulatory approval for commercial sale is obtained will depend in part on the availability of coverage and reimbursement from third-party payors. Third-party payors include government authorities, managed care providers, private health insurers and other organizations.
In the United States and markets in other countries, sales of any product candidates for which regulatory approval for commercial sale is obtained will depend in part on the availability of coverage and adequate reimbursement from third-party payors. Third-party payors include government authorities, managed care providers, private health insurers and other organizations.
We focus research on designing features and implementing delivery device solutions that we believe have the potential to improve the effect, patient safety and caregiver usability of AAV Therapeutics. We have advanced image-guided device delivery of AAV Therapeutics into the cerebrospinal fluid to target the brain and central nervous system for neurodegenerative diseases.
We focus research on designing 5 features and implementing delivery device solutions that we believe have the potential to improve the effect, patient safety and caregiver usability of AAV Therapeutics. We have advanced image-guided device delivery of AAV Therapeutics into the cerebrospinal fluid to target the brain and central nervous system for neurodegenerative diseases.
While the process for the application and granting of the approvals was streamlined, it remains a complex process that can significantly delay the start of a multinational clinical trial. In the United Kingdom of Great Britain and Northern Ireland (UK), clinical trials are governed by the Medicines for Human Use (Clinical Trials) Regulations 2004.
While the process for the application and granting of the approvals was streamlined, it remains a complex process that can significantly delay the start of a multinational clinical trial. In the United Kingdom of Great Britain and Northern Ireland (UK), clinical trials are governed by the Medicines for Human Use (Clinical Trials) Regulations 2004 (UK CTRs).
Many countries outside of the United States have a similar process that requires the submission of a clinical study application much like the IND prior to the commencement of human clinical studies. In the EU, for example, clinical trials are governed by the new EU Regulation on Clinical Trials (Reg.
Many countries outside of the United States have a similar process that requires the submission of a clinical study application much like the IND prior to the commencement of human clinical studies. In the EU, for example, clinical trials are governed by the EU Regulation on Clinical Trials (Reg.
We have developed a proprietary, high-yielding manufacturing process platform for NAV vector production (NAVXpress TM ) that can be applied across multiple AAV Therapeutics. This manufacturing process platform approach improves development efficiency and shortens timelines by leveraging data across multiple programs.
We have developed a proprietary, high-yielding manufacturing process platform for NAV vector production (NAVXpress ® ) that can be applied across multiple AAV Therapeutics. This manufacturing process platform approach improves development efficiency and shortens timelines by leveraging data across multiple programs.
We believe that our analytical capabilities are at the forefront of AAV Therapeutic development. AAV Therapeutic Manufacturing Our research team works closely with our manufacturing team, allowing us to evaluate the manufacturability of AAV Therapeutics early in the discovery process.
We believe that our analytical capabilities are at the forefront of AAV Therapeutic development. 4 AAV Therapeutic Manufacturing Our research team works closely with our manufacturing team, allowing us to evaluate the manufacturability of AAV Therapeutics early in the discovery process.
We have developed a broad pipeline of investigational AAV Therapeutics using our NAV Technology Platform as a one-time treatment to address an array of diseases. We are currently focusing our internal development pipeline in three areas: retinal, neuromuscular and neurodegenerative diseases. We believe these product candidates are differentiated, can be expedited, and support meaningful near-term and long-term value generation.
We have developed a broad pipeline of investigational AAV Therapeutics using our NAV Technology Platform as one-time treatments to address an array of diseases. We are currently focusing our internal development pipeline in three areas: retinal, neuromuscular and neurodegenerative diseases. We believe these product candidates are differentiated, can be expedited, and support meaningful near-term and long-term value generation.
RGX-202 is designed to support the delivery and targeted expression of genes throughout skeletal and heart muscle using the NAV AAV8 vector, and a well-characterized muscle-specific promoter (Spc5-12). We have received orphan drug product, Fast Track designation and rare pediatric disease designation from the FDA for RGX‑202.
RGX-202 is designed to support the delivery and targeted expression of the transgene throughout skeletal and heart muscle using the NAV AAV8 vector, and a well-characterized muscle-specific promoter (Spc5-12). We have received orphan drug product, Fast Track designation and rare pediatric disease designation from the FDA for RGX‑202.
Under the Breakthrough Therapy program, products intended to treat a serious or life-threatening disease or condition may be eligible for additional benefits when preliminary clinical evidence demonstrates that such product may have substantial improvement on one or more clinically significant endpoints over existing therapies.
Under the Breakthrough Therapy program, products intended to treat a serious or life-threatening disease or condition may be eligible for additional benefits when preliminary clinical evidence demonstrates that such product may have substantial improvement on one or more clinically significant endpoints over available therapies.
Our patent portfolio relating to ABBV-RGX-314 includes one issued U.S. patent that will expire in 2037, one pending PCT and seven PCTs that have entered national stage for which any issued U.S. or European patent would expire in 2037, 2038, 2039, 2040 or 2043, in each case without taking into account any possible patent term adjustment or extension. 14 Table of Contents Neuromuscular Diseases In addition to our NAV Technology Platform patents covering the NAV AAV8 vector and its manufacture, our patent portfolio includes more recent filings relating to RGX-202, the NAV AAV8 capsid carrying our microdystrophin construct used to treat Duchenne and the manufacture of RGX-202.
Our patent portfolio relating to ABBV-RGX-314 includes one issued U.S. patent that will expire in 2037, one pending PCT and seven PCTs that have entered national stage for which any issued U.S. or European patent would expire in 2037, 2038, 2039, 2040 or 2043, in each case without taking into account any possible patent term adjustment or extension. 16 Neuromuscular Diseases In addition to our NAV Technology Platform patents covering the NAV AAV8 vector and its manufacture, our patent portfolio includes more recent filings relating to RGX-202, the NAV AAV8 capsid carrying our microdystrophin construct used to treat Duchenne and the manufacture of RGX-202.
Additionally, marketing authorization may be granted to a similar product during the 10-year period of market exclusivity for the same therapeutic indication at any time if: • The second applicant can establish in its application that its product, although similar to the orphan medicinal product already authorized, is safer, more effective or otherwise clinically superior; 25 Table of Contents • The holder of the marketing authorization for the original orphan medicinal product consents to a second orphan medicinal product application; or • The holder of the marketing authorization for the original orphan medicinal product cannot supply enough orphan medicinal product.
Additionally, marketing authorization may be granted to a similar product during the 10-year period of market exclusivity for the same therapeutic indication at any time if: • The second applicant can establish in its application that its product, although similar to the orphan medicinal product already authorized, is safer, more effective or otherwise clinically superior; • The holder of the marketing authorization for the original orphan medicinal product consents to a second orphan medicinal product application; or • The holder of the marketing authorization for the original orphan medicinal product cannot supply enough orphan medicinal product.
We have also taken an active role in the formation of several of our NAV Technology Licensees, including being a founding shareholder in Dimension Therapeutics, Inc. (Dimension), Prevail Therapeutics Inc. (Prevail) and Corlieve Therapeutics SAS (Corlieve), all of which have been acquired in strategic transactions since their formation.
We have also taken an active role in the formation of several of our NAV Technology Licensees, including being a founding shareholder in Dimension Therapeutics, Inc., Prevail Therapeutics Inc. and Corlieve Therapeutics SAS, all of which were acquired in strategic transactions since their formation.
Food and Drug Administration (FDA) in 2019, and has been used to treat over 3,700 patients suffering from SMA, a debilitating and potentially deadly disease. Our partnering strategy provides us the flexibility to sublicense development of treatments designed to address significant unmet medical needs, while remaining focused on our own pipeline of AAV Therapeutics.
Food and Drug Administration (FDA) in 2019, and has been used to treat over 4,500 patients suffering from SMA, a debilitating and potentially deadly disease. Our partnering strategy 3 provides us the flexibility to sublicense development of treatments designed to address significant unmet medical needs, while remaining focused on our own pipeline of AAV Therapeutics.
We have deep in-house knowledge of biologics and gene therapy manufacturing, which has enabled us to scale manufacturing of our AAV Therapeutics while ensuring product quality for patients and improving cost-of-goods. 4 Table of Contents We have developed systems which we believe will provide robust manufacturing and global supply of AAV Therapeutics to meet quality requirements and anticipated research, clinical and future commercial demand.
We have deep in-house knowledge of biologics and gene therapy manufacturing, which has enabled us to scale manufacturing of our AAV Therapeutics while ensuring product quality for patients and improving cost-of-goods. We have developed systems which we believe will provide robust manufacturing and global supply of AAV Therapeutics to meet quality requirements and anticipated research, clinical and future commercial demand.
In addition, the FDA may require post marketing clinical studies designed to further assess a biological product’s safety and effectiveness, and testing and surveillance programs to monitor the safety of approved products that have been commercialized. 19 Table of Contents For new molecular entities, one of the performance goals agreed to by the FDA under PDUFA is to review 90% of standard BLAs within 10 months of the 60-day filing date and 90% of priority BLAs in six months of the 60-day filing date, whereupon a review decision is to be made.
In addition, the FDA may require post marketing clinical studies designed to further assess a biological product’s safety and effectiveness, and testing and surveillance programs to monitor the safety of approved products that have been commercialized. 21 For new molecular entities, one of the performance goals agreed to by the FDA under PDUFA is to review 90% of standard BLAs within 10 months of the 60-day filing date and 90% of priority BLAs in six months of the 60-day filing date, whereupon a review decision is to be made.
Accordingly, manufacturers must continue to expend time, money, and effort in the area of production and quality control to maintain cGMP compliance. Discovery of 21 Table of Contents problems with a product after approval may result in restrictions on a product, manufacturer, or holder of an approved BLA, including withdrawal of the product from the market.
Accordingly, manufacturers must continue to expend time, money, and effort in the area of production and quality control to maintain cGMP compliance. Discovery of problems with a product after approval may result in restrictions on a product, manufacturer, or holder of an approved BLA, including withdrawal of the product from the market.
Our Investigational AAV Therapeutics As of December 31, 2023, in addition to the patents related to our NAV Technology Platform described above, our patent portfolio included a total of four issued U.S. patents, one issued European patent, two pending International Patent applications filed pursuant to the Patent Cooperation Treaty (PCTs) and 19 PCTs that have entered national stage relating to our product candidates, which are described below: Retinal Diseases In addition to our NAV Technology Platform patents covering the NAV AAV8 vector and manufacture of NAV AAV8 vectors used in our retinal disease programs, our patent portfolio includes more recent filings relating to our clinical candidate vectors, clinical protocols, routes of administration to the eye (subretinal and suprachoroidal), formulations and target diseases treated by our gene therapy vectors.
Our Investigational AAV Therapeutics As of December 31, 2024, in addition to the patents related to our NAV Technology Platform described above, our patent portfolio included a total of six issued U.S. patents, one issued European patent, two pending International Patent applications filed pursuant to the Patent Cooperation Treaty (PCTs) and 22 PCTs that have entered national stage relating to our product candidates, which are described below: Retinal Diseases In addition to our NAV Technology Platform patents covering the NAV AAV8 vector and manufacture of NAV AAV8 vectors used in our retinal disease programs, our patent portfolio includes more recent filings relating to our clinical candidate vectors, clinical protocols, routes of administration to the eye (subretinal and suprachoroidal), formulations and target diseases treated by our gene therapy vectors.
Two additional products are marketed in select geographies in Asia by JCR Pharmaceuticals Co., Ltd. (Izcargo) and GC Pharma (Hunterase ICV). Companies with products in development for the treatment of MPS II include, but may not be limited to, Denali Therapeutics Inc., and Sigilon Therapeutics, Inc.
Two additional products are marketed in select geographies in Asia by JCR Pharmaceuticals Co., Ltd. (Izcargo) and GC Pharma (Hunterase ICV). Companies with products in development for the treatment of MPS II include, but may not be limited to, Denali Therapeutics Inc., Esteve and Immusoft.
Our license agreement with Penn, as amended, provides us with an exclusive, worldwide license under certain patents and patent applications in order to make, have made, use, import, offer for sale and sell products covered by the claims of the licensed patents and patent applications as well as all patentable inventions (to the extent they are or become available for license) that: • were discovered by Dr.
Wilson (the 2014 SRA). 13 Our license agreement with Penn, as amended, provides us with an exclusive, worldwide license under certain patents and patent applications in order to make, have made, use, import, offer for sale and sell products covered by the claims of the licensed patents and patent applications as well as all patentable inventions (to the extent they are or become available for license) that: • were discovered by Dr.
Moreover, a payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved. 23 Table of Contents Third-party payors are increasingly challenging the price and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy.
Moreover, a payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate will be approved. 25 Third-party payors are increasingly challenging the price and examining the medical necessity and cost-effectiveness of medical products and services, in addition to their safety and efficacy.
Our Good Manufacturing Practices (cGMP) production facility, the REGENXBIO Manufacturing Innovation Center (RMIC), is located in our corporate headquarters in Rockville, Maryland. The RMIC has been designed to support production of AAV Therapeutics and has been in operation since mid-2022.
Our Good Manufacturing Practices (cGMP) production facility, the REGENXBIO Manufacturing Innovation Center (RMIC), is located in our corporate headquarters in Rockville, Maryland. The RMIC has been designed to support clinical and future commercial production of AAV Therapeutics and has been in operation since mid-2022.
Our website address is www.regenxbio.com. The information contained in, or that can be accessed through, our website is not a part of, or incorporated by reference in, this Annual Report on Form 10-K. We file annual, quarterly, and current reports, proxy statements, and other documents with the SEC under the Exchange Act.
The information contained in, or that can be accessed through, our website is not a part of, or incorporated by reference in, this Annual Report on Form 10-K. We file annual, quarterly, and current reports, proxy statements, and other documents with the SEC under the Exchange Act.
After a BLA is approved, the product also may be subject to official lot release. As part of the manufacturing process, the manufacturer is required to perform certain tests on each lot of the product before it is released for distribution.
After a BLA is approved, the product also may be subject to official lot release. As part of the manufacturing process, manufacturers are required to perform certain tests on each lot of the product before it is released for distribution.
We believe we have extensive human safety experience to support the development of our investigational AAV Therapeutics based on data from over 4,500 patients dosed with AAV Therapeutics derived from our NAV Technology Platform in more than 15 different clinical-stage programs and with one FDA approved product.
We believe we have extensive human safety experience to support the development of our investigational AAV Therapeutics based on data from thousands of patients dosed with AAV Therapeutics derived from our NAV Technology Platform in more than 15 different clinical-stage programs and with one FDA approved product.
For other countries outside of the EU, such as countries in Eastern Europe, Latin America or Asia, the requirements governing the conduct of clinical studies, product licensing, 26 Table of Contents pricing and reimbursement vary from country to country.
For other countries outside of the EU, such as countries in Eastern Europe, Latin America or Asia, the requirements governing the conduct of clinical studies, product licensing, pricing and reimbursement vary from country to country.
Not only must we compete with other companies that are focused on gene therapy products using earlier generation AAV technology and other gene therapy platforms, but any products that we may commercialize will have to compete with existing therapies and new therapies that may become available in the future. 15 Table of Contents There are other organizations working to improve existing therapies or to develop new therapies for our initially selected disease indications.
Not only must we compete with other companies that are focused on gene therapy products using earlier generation AAV technology and other gene therapy platforms, but any products that we may commercialize will have to compete with existing therapies and new therapies that may become available in the future. 17 There are other organizations working to improve existing therapies or to develop new therapies for our initially selected disease indications.
Under the terms of the agreement, we are obligated to pay Minnesota upfront fees, annual maintenance fees, royalties on net sales, if any, sublicense fees and fees upon the achievement of various milestones. 13 Table of Contents Emory University .
Under the terms of the agreement, we are obligated to pay Minnesota upfront fees, annual maintenance fees, royalties on net sales, if any, sublicense fees and fees upon the achievement of various milestones. Emory University .
Our patent portfolio relating to RGX-202 includes two pending PCTs and three PCTs that have entered the national stage for which any issued U.S. or European patent would expire in 2040, 2042 or 2043 without taking into account any possible patent term adjustment or extension.
Our patent portfolio relating to RGX-202 includes five pending PCTs that have entered the national stage for which any issued U.S. or European patent would expire in 2040, 2042 or 2043 without taking into account any possible patent term adjustment or extension.
Our patent portfolio relating to RGX-121 includes one issued U.S. patent that will expire in 2038, one issued U.S. patent that will expire in 2039 and one issued U.S. patent that will expire in 2040, one issued European patent that will expire in 2036 and nine PCTs that have entered national stage for which any issued U.S. or European patents would expire in 2034, 2036, 2037, 2038, 2041 or 2042, in each case without taking into account any possible patent term adjustment or extension.
Our patent portfolio relating to RGX-121 includes one issued U.S. patent that will expire in 2034, one issued U.S. patent that will expire in 2038, one issued U.S. patent that will expire in 2039, one issued U.S. patent that will expire in 2040, one issued U.S. patent that will expire in 2042, one issued European patent that will expire in 2036, one pending PCT application and ten PCTs that have entered national stage for which any issued U.S. or European patents would expire in 2034, 2036, 2037, 2038, 2039, 2041 or 2042, in each case without taking into account any possible patent term adjustment or extension.
Two separate routes of administration of ABBV-RGX-314 to the eye are being evaluated: a subretinal delivery procedure as well as a targeted, in-office administration to the suprachoroidal space. We have licensed certain exclusive rights to the SCS Microinjector ® from Clearside Biomedical, Inc. (Clearside) to deliver gene therapy treatments to the suprachoroidal space of the eye.
Two separate routes of administration of ABBV-RGX-314 to the eye are being evaluated: a subretinal delivery procedure as well as a targeted, in-office administration to the suprachoroidal space. We have licensed certain exclusive rights to the SCS Microinjector ® from Clearside Biomedical, Inc.
Competition We are aware of a number of companies focused on developing gene therapies in various disease indications, including 4D Molecular Therapeutics, Inc., Adverum Biotechnologies, Inc., Amicus Therapeutics, Inc., BioMarin Pharmaceutical, Inc., Homology Medicines, Inc., MeiraGTx Limited, Novartis AG, Passage Bio, Inc., PTC Therapeutics, Inc., Roche, Sanofi, Sarepta Therapeutics, Inc., Solid Biosciences, Inc., Taysha Gene Therapies, Inc., Tenaya Therapeutics, Inc. and uniQure N.V., as well as a number of companies addressing other methods for modifying genes and regulating gene expression.
Competition We are aware of a number of companies focused on developing and commercializing gene therapies in various disease indications, including 4D Molecular Therapeutics, Inc., Adverum Biotechnologies, Inc., Amicus Therapeutics, Inc., Astellas Pharma, BioMarin Pharmaceutical, Inc., MeiraGTx Limited, Novartis AG, Passage Bio, Inc., PTC Therapeutics, Inc., Roche, Sanofi, Sarepta Therapeutics, Inc., Solid Biosciences, Inc., Taysha Gene Therapies, Inc., Tenaya Therapeutics, Inc., Ultragenyx Pharmaceutical Inc. and uniQure N.V., as well as a number of companies addressing other methods for modifying genes and regulating gene expression.
Each protocol and any amendments to the protocol must be submitted to the FDA as 17 Table of Contents part of the IND. Clinical studies must be conducted and monitored in accordance with the FDA’s regulations imposing the GCP requirements, including the requirement that all research subjects provide informed consent.
Each protocol and any amendments to the protocol must be submitted to the FDA as 19 part of the IND. Clinical studies must be conducted and monitored in accordance with the FDA’s regulations imposing the GCP requirements, including the requirement that all research subjects provide informed consent.
We believe that we are in material compliance with applicable environmental laws and that continued compliance therewith will not have a material adverse effect on our business. We cannot predict, however, how changes in these laws may affect our future operations. Equivalent laws have been adopted in other countries that impose similar obligations. 22 Table of Contents Other U.S.
We believe that we are in material compliance with applicable environmental laws and that continued compliance therewith will not have a material adverse effect on our business. We cannot predict, however, how changes in these laws may affect our future operations. Equivalent laws have been adopted in other countries that impose similar obligations. 24 Other U.S.
A product under the Fast Track, Breakthrough Therapy, or RMAT programs may be eligible for “rolling review,” which means the FDA may consider for review sections of the BLA on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the application, the FDA agrees to accept sections of the application and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the application. 20 Table of Contents A BLA may be eligible for priority review if the product has the potential to provide safe and effective therapy where no satisfactory alternative therapy exists or a significant improvement in the treatment, diagnosis or prevention of a serious or life-threatening disease or condition compared to marketed products.
A product with Fast Track, Breakthrough Therapy, or RMAT designation program may be eligible for “rolling review,” which means the FDA may consider for review sections of the BLA on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the application, the FDA agrees to accept sections of the application and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the application. 22 A BLA may be eligible for priority review if the product has the potential to provide safe and effective therapy where no satisfactory alternative therapy exists or a significant improvement in the treatment, diagnosis or prevention of a serious or life-threatening disease or condition compared to marketed products.
Other companies with gene therapies in early development for DMD include, but may not be limited to, Solid Biosciences, Genethon, Ultragenyx, Insmed, and Vertex. • MPS II. The principal marketed competition for the treatment of MPS II is a systemic enzyme replacement therapy marketed by Takeda Pharmaceutical Company, Ltd. and Sanofi (Elaprase).
Other companies with gene therapies in early development for DMD include, but may not be limited to, Ultragenyx, Insmed, Huidagene, Novartis and Vertex. • MPS II. The principal marketed competition for the treatment of MPS II is a systemic enzyme replacement therapy marketed by Takeda Pharmaceutical Company, Ltd. and Sanofi (Elaprase).
Applications to the FDA are required before conducting clinical testing of biological products, and each clinical study protocol for a gene therapy product is reviewed by the FDA. 16 Table of Contents Within the FDA, the Center for Biologics Evaluation and Research (CBER) regulates gene therapy products as biological products.
Applications to the FDA are required before conducting clinical testing of biological products, and each clinical study protocol for a gene therapy product is reviewed by the FDA. 18 Within the FDA, the Center for Biologics Evaluation and Research (CBER) regulates gene therapy products as biological products.
Presence of the CT domain has been shown in preclinical studies to recruit several key proteins to the muscle cell membrane, leading to improved muscle resistance to contraction-induced muscle damage in dystrophic mice. Additional design features, including codon optimization and reduced CpG content, may potentially improve gene expression, increase translational efficiency and reduce immunogenicity.
Presence of the CT domain has been shown in preclinical studies to recruit several key proteins to the muscle cell membrane, leading to improved muscle resistance to contraction-induced muscle damage in dystrophic mice. Additional design features may potentially improve gene expression, increase translational efficiency and reduce immunogenicity.
NAV Technology Platform As of December 31, 2023, our patent portfolio included 24 issued U.S. patents and three European patents relating to the AAV7, AAV8, AAV9, AAVrh10 and AAVrh46 vectors and their uses. These patents have terms that will expire as late as 2027, not including patent term extensions.
NAV Technology Platform As of December 31, 2024, our patent portfolio included 25 issued U.S. patents and five European patents relating to the AAV7, AAV8, AAV9, AAVrh10 and AAVrh46 vectors and their uses. These patents have terms that will expire as late as 2027, not including patent term extensions.
Under the terms of the Penn license agreement, we issued equity to Penn and are also obligated to pay Penn: • up to $20.5 million upon the achievement of various development and sales-based milestones; • low- to mid-single digit royalties on net sales of licensed pharmaceutical products sold by us or our affiliates; • low-single digit to low-double digit royalty percentages of net sales on licensed products intended for research purposes only; • low- to mid-double digit royalty percentage on royalties received from third parties on net sales of licensed pharmaceutical products by such third parties; • certain sublicense fees, of which $9 million remains outstanding as of December 31, 2023; and • reimbursements for ongoing patent prosecution and maintenance expenses.
Under the terms of the Penn license agreement, we issued equity to Penn and are also obligated to pay Penn: • up to $20.5 million upon the achievement of various development and sales-based milestones, of which $0.5 million have been paid to date; • low- to mid-single digit royalties on net sales of licensed pharmaceutical products sold by us or our affiliates; • low-single digit to low-double digit royalty percentages of net sales on licensed products intended for research purposes only; • low- to mid-double digit royalty percentage on royalties received from third parties on net sales of licensed pharmaceutical products by such third parties; • certain sublicense fees, of which $6.0 million remain outstanding as of December 31, 2024; and • reimbursements for ongoing patent prosecution and maintenance expenses.
The principal marketed anti-VEGF competition for DR without DME is Roche/Genentech (Lucentis) and Regeneron (Eylea, Eylea HD). Companies with products in development for the treatment of DR without DME include, but may not be limited to, Eyepoint Pharmaceuticals, Kodiak Sciences, Novartis, Ocular Therapeutix, Ocuphire Pharma, OcuTerra Therapeutics, and Roche. • DMD.
The principal marketed anti-VEGF competition for DR without DME is Roche/Genentech (Lucentis) and Regeneron (Eylea, Eylea HD). Companies with products in development for the treatment of DR without DME include, but may not be limited to, Kodiak Sciences, Novartis, Ocular Therapeutix and Roche. • DMD.
Our investigational AAV Therapeutics include: • ABBV-RGX-314, which we are developing in collaboration with AbbVie to treat large patient populations impacted by wet age-related macular degeneration (wet AMD), diabetic retinopathy (DR) and other chronic retinal diseases characterized by loss of vision. • RGX-202, which we are developing to treat Duchenne muscular dystrophy (Duchenne), one of the most common fatal genetic disorders affecting children. • RGX-121, which we are developing to treat Mucopolysaccharidosis type II (MPS II), a progressive, neurodegenerative lysosomal storage disorder. 2 Table of Contents Our internal pipeline is shown below.
Our investigational AAV Therapeutics include: • ABBV-RGX-314, which we are developing in collaboration with AbbVie to treat large patient populations impacted by wet age-related macular degeneration (wet AMD), diabetic retinopathy (DR) and other chronic retinal diseases characterized by loss of vision. • RGX-202, which we are developing to treat Duchenne muscular dystrophy (Duchenne), one of the most common fatal genetic disorders affecting children. • RGX-121 and RGX-111, which we are developing and plan to commercialize with Nippon Shinyaku to treat Mucopolysaccharidosis type II (MPS II) and Mucopolysaccharidosis type I (MPS I), both of which are progressive, neurodegenerative lysosomal storage disorders. 2 Our internal pipeline is shown below.
Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the biological product candidate does not undergo unacceptable deterioration over its shelf life. 18 Table of Contents U.S.
Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the biological product candidate does not undergo unacceptable deterioration over its shelf life. 20 U.S.
Customers Our revenues for the years ended December 31, 2023, 2022 and 2021 consisted solely of license and royalty revenue. One customer (Novartis Gene Therapies) accounted for approximately 95% of our total revenues for the year ended December 31, 2023. One customer (Novartis Gene Therapies) accounted for approximately 90% of our total revenues for the year ended December 31, 2022.
Customers Our revenues for the years ended December 31, 2024, 2023 and 2022 consisted solely of license and royalty revenue. One customer (Novartis Gene Therapies) accounted for approximately 98%, 95% and 90% of our total revenues for the years ended December 31, 2024, 2023 and 2022, respectively.
It is possible that the information that we post on our social media channels could be deemed material information. Therefore, we encourage investors, the media and others interested in our company to review the information that we post on our social media channels. 28 Table of Contents
It is possible that the information that we post on our social media channels could be deemed material information. Therefore, we encourage investors, the media and others interested in our company to review the information that we post on our social media channels. 29
A new Regulation on HTA on EU level was adopted in December 2021: Regulation (EU) 2021/2282 on health technology assessment (the HTA Regulation). The HTA Regulation covers new medicines and certain new medical devices.
A new Regulation on HTA on EU level was adopted in December 2021: Regulation (EU) 2021/2282 on health technology assessment (the HTA Regulation) and applies from January 12, 2025. The HTA Regulation covers new medicines and certain new medical devices.
We can design our AAV Therapeutics to deliver genes for a spectrum of therapeutic modalities. Our current pipeline of investigational AAV Therapeutics uses NAV Vectors to deliver genes for a therapeutic antibody, or a functional gene to compensate for a missing or non-functional gene.
We can design our AAV Therapeutics to deliver transgenes encoding a spectrum of therapeutic modalities. Our current pipeline of investigational AAV Therapeutics uses NAV Vectors to deliver transgenes encoding therapeutic antibodies, or able to compensate for a missing or non-functional gene.
MPS II, also known as Hunter syndrome, is a rare disease caused by a deficiency of the IDS gene which encodes the I2S enzyme. The I2S enzyme is responsible for the breakdown of polysaccharides called heparan sulfate (HS) and dermatan sulfate (DS) in lysosomes, which are structures that dispose of waste products inside cells.
MPS II, also known as Hunter syndrome, is a rare disease caused by mutations in the gene responsible for making iduronate-2-sulfatase (IDS), which encodes the I2S enzyme. The I2S enzyme is responsible for the breakdown of the polysaccharides heparan sulfate (HS) and dermatan sulfate in lysosomes, structures that dispose of waste products inside cells.
We leverage the differentiated characteristics of NAV Vectors to target different tissues and cells. To further enhance the profile of AAV Therapeutics, we have developed a platform of different devices to assist in the delivery of AAV Therapeutics using multiple routes of administration to tissues and cells.
To further enhance the profile of AAV Therapeutics, we have developed a platform of different devices to assist in the delivery of AAV Therapeutics using multiple routes of administration to tissues and cells.
We aim to ensure that our formulations are designed and assessed to ensure product stability can be maintained for numerous years and that our AAV Therapeutics can be exposed to a variety of handling and delivery procedures.
We have developed product formulations specific to our different delivery devices and routes of administration. We aim to ensure that our formulations are designed and assessed to ensure product stability can be maintained for numerous years and that our AAV Therapeutics can be exposed to a variety of handling and delivery procedures.
We currently use our NAV Technology Platform to develop treatments in the areas of retinal, neuromuscular and neurodegenerative diseases. We also sublicense our NAV Technology Platform to third parties in order to develop and bring to market AAV Therapeutics for a range of severe diseases with significant unmet medical needs outside of our core disease indications and therapeutic areas.
We also sublicense our NAV Technology Platform to third parties in order to develop and bring to market AAV Therapeutics for a range of severe diseases with significant unmet medical needs outside of our core disease indications and therapeutic areas. The Trustees of the University of Pennsylvania.
In addition, gene therapies, including genetically modified cells, that lead to a durable modification of cells or tissues, may be eligible for regenerative medicine advanced therapy (RMAT) designation.
In addition, gene therapies, including genetically modified cells, that lead to a sustained effect on cells or tissues, may be eligible for regenerative medicine advanced therapy (RMAT) designation.
Without dystrophin, muscles throughout the body degenerate and become weak, eventually leading to loss of movement and independence, required support for breathing, cardiomyopathy and premature death. There is presently no cure for Duchenne, and for most patients, there are no satisfactory disease modifying treatments available. Duchenne is one of the most common fatal genetic disorders affecting children, primarily boys.
Without dystrophin, muscles throughout the body degenerate and become weak, eventually leading to loss of movement and independence, required support for breathing, cardiomyopathy and premature death. There is presently no cure for Duchenne, and there is a significant unmet need for disease modifying treatment options. Duchenne is one of the most common fatal genetic disorders affecting children, primarily boys.
In 2018, in our clinical trial for the treatment of MPS II, an investigational AAV Therapeutic was delivered to a patient using an intracisternal delivery device for the first time. We have also led the development of two different types of delivery devices of AAV Therapeutics into the eye for targeting the retina of patients.
We have also led the development of two different types of delivery devices of AAV Therapeutics into the eye for targeting the retina of patients. In 2020, in our clinical trial for the in-office treatment of wet AMD, an investigational AAV Therapeutic was delivered to a patient using a novel, suprachoroidal delivery device for the first time.
Our experience and expertise distinguish us from other gene therapy companies and will help ensure value generation and our continued growth. AAV Therapeutics Historically, the primary challenge for gene therapy has been the safe and effective delivery of genes into cells.
Our experience and expertise distinguish us from other gene therapy companies and will help ensure value generation and our continued growth. AAV Therapeutics Historically, the primary challenge for gene therapy has been the safe and effective delivery of genes into cells. To address this challenge, scientists designed and developed a variety of gene vectors to facilitate gene delivery into cells.
Individual member states will continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technology, and making decisions on pricing and reimbursement. The HTA Regulation will become applicable in January 2025.
Individual member states will continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technology, and making decisions on pricing and reimbursement.
By the time of death, most patients with CNS involvement are severely mentally handicapped and require constant care. MPS II is estimated to occur in approximately 1 in 100,000 to 1 in 170,000 births worldwide. Based on global population, this equates to approximately 500 to 1,000 MPS II patients born each year worldwide.
By the time of death, most patients with CNS involvement are severely mentally handicapped and require constant care. MPS II is estimated to occur in approximately 1 in 100,000 to 1 in 170,000 births worldwide.
The Trustees of the University of Pennsylvania. In February 2009, we entered into an exclusive, worldwide license agreement with Penn for patent and other intellectual property rights relating to a gene therapy technology platform based on AAVs discovered at Penn in the laboratory of James M. Wilson, M.D., Ph.D.
In February 2009, we entered into an exclusive, worldwide license agreement with Penn for patent and other intellectual property rights relating to a gene therapy technology platform based on AAVs discovered at Penn in the laboratory of James M. Wilson, M.D., Ph.D. This license was amended in September 2014, April 2016, April 2019, September 2020 and March 2022.
Human Capital Resources As of February 22, 2024, we employed 344 full-time employees, of which 277 were engaged in research and development activities, including preclinical, clinical and manufacturing related functions, and 67 were engaged in general administrative activities, including commercial, corporate development, finance, legal, human resources, information technology, facilities and other general and administrative functions.
Human Capital Resources As of March 7, 2025, we employed 353 full-time employees, of which 285 were engaged in research and development activities, including preclinical, clinical and manufacturing related functions, and 68 were engaged in general administrative activities, including commercial, corporate development, finance, legal, human resources, information technology, facilities and other general and administrative functions.
To date, we have observed that AAV Therapeutics derived from our NAV Technology Platform have been generally well tolerated. 3 Table of Contents Our AAV Therapeutic Platform Discovery and Development of AAV Therapeutics We have a team of scientists and engineers dedicated to expanding the understanding and applications of AAV vectors, applying the differentiated capabilities of the NAV Technology Platform and exploring the potential to generate new, innovative AAV Therapeutics.
Our AAV Therapeutic Platform Discovery and Development of AAV Therapeutics We have a team of scientists and engineers dedicated to expanding the understanding and applications of AAV vectors, applying the differentiated capabilities of the NAV Technology Platform and exploring the potential to generate new, innovative AAV Therapeutics.
Future license and royalty revenue is uncertain due to the contingent nature of our licenses granted to third parties and may fluctuate significantly from period to period.
We expect future license and royalty revenue to continue to be derived from a limited number of licensees. Future license and royalty revenue is uncertain due to the contingent nature of our licenses granted to third parties and may fluctuate significantly from period to period.
Therefore, the UK regulatory regime is currently substantially similar to EU regulations, but under the Medicines and Medical Devices Act 2021, the UK may adopt changed regulations for medicines, including their research, development and commercialization. Currently, there are proposals to amend regulations with respect to clinical trials.
Therefore, the UK regulatory regime is currently substantially similar to EU regulations, but under the Medicines and Medical Devices Act 2021, the UK may adopt changed regulations for medicines, including their research, development and commercialization. Currently, new regulations with respect to clinical trials are due to come into force in 2026, as referred to above (the New UK CTRs).
Penn has the right to terminate: • with notice if we are late in paying money due under the license agreement; • with notice if we fail to achieve a diligence event on or before the applicable completion date or otherwise breach the license agreement; • if we or our affiliates experience insolvency; or • if we commence any action against Penn to declare or render any claim of the licensed patent rights invalid or unenforceable. 12 Table of Contents Under the 2014 SRA, as amended, we funded research at Penn, paid certain intellectual property legal and filing expenses and received the rights to certain research results.
Penn has the right to terminate: • with notice if we are late in paying money due under the license agreement; • with notice if we fail to achieve a diligence event on or before the applicable completion date or otherwise breach the license agreement; 14 • if we or our affiliates experience insolvency; or • if we commence any action against Penn to declare or render any claim of the licensed patent rights invalid or unenforceable.
The principal marketed competition for the treatment of DMD is a gene therapy marketed by Sarepta/Roche (Elevidys). Currently marketed exon skipping competition for DMD includes Sarepta (Exondys, Vyondys, Amondys) and Nippon Shinyaku Co., Ltd. (Viltepso). There is one principal competitive gene therapy product in clinical development from Pfizer, Inc. (PF-06939926).
The principal marketed competition for the treatment of DMD is a gene therapy marketed by Sarepta/Roche (Elevidys). Currently marketed exon skipping competition for DMD includes Sarepta (Exondys, Vyondys, Amondys) and Nippon Shinyaku Co., Ltd. (Viltepso). There are two principal competitive gene therapy products in clinical development from Solid Biosciences (SGT-003) and Genethon (GNT0004).
Dose level 2 reduced the risk of developing vision-threatening events by 89% in these patients. 7 Table of Contents NPDR patients treated with ABBV-RGX-314 at dose levels 1 and 2 demonstrated clinically meaningful improvements in disease severity and reduction of vision-threatening events.
NPDR patients treated with ABBV-RGX-314 at dose levels 1 and 2 demonstrated clinically meaningful improvements in disease severity and reduction of vision-threatening events.
Biological product manufacturers and other entities involved in the manufacture and distribution of approved biological products are required to register their establishments with the FDA and certain state agencies, and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP and other laws.
Any agency or judicial enforcement action could have a material adverse effect on us. 23 Biological product manufacturers and other entities involved in the manufacture and distribution of approved biological products are required to register their establishments with the FDA and certain state agencies, and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP and other laws.
Collaborations, Licensing and Company Formation Collaborations, licensing and company formation are a key part of our commitment to enable the ongoing development of gene therapy treatments. 9 Table of Contents AbbVie Eye Care Collaboration In September 2021, REGENXBIO and AbbVie announced a global strategic partnership to develop and commercialize ABBV-RGX-314, a potential one-time gene therapy for the treatment of wet AMD, DR and other chronic retinal diseases.
AbbVie Eye Care Collaboration In September 2021, REGENXBIO and AbbVie announced a global strategic partnership to develop and commercialize ABBV-RGX-314, a potential one-time gene therapy for the treatment of wet AMD, DR and other chronic retinal diseases.
Lucentis biosimilars (Biogen - Byooviz, Coherus Biosciences - Cimerli) are also now marketed. Companies with products in development for the treatment of wet AMD include, but may not be limited to, 4D Molecular Therapeutics, Adverum, Eyepoint Pharmaceuticals, Kodiak Sciences, Inc., Ocular Therapeutix, Opthea, and Outlook Therapeutics, Inc. • DR.
Companies with products in development for the treatment of wet AMD include, but may not be limited to, 4D Molecular Therapeutics, Adverum, Avirmax Bio, Exegenesis Bio, Eyepoint Pharmaceuticals, Kodiak Sciences, Inc., Ocular Therapeutix, Opthea, Outlook Therapeutics, Inc. and Skyline Therapeutics. • DR.
As of December 31, 2023, over 4,500 patients have been treated by REGENXBIO and our NAV Technology Licensees using NAV Vectors across clinical trials, managed access and commercial settings. Our NAV Technology Licensees are shown below.
To date, thousands of patients have been treated by REGENXBIO and our NAV Technology Licensees using NAV Vectors across clinical trials, managed access and commercial settings. 12 Our NAV Technology Licensees are shown below.
Diversity, Equity and Inclusion We believe that a diverse, equitable and inclusive culture fosters innovation, which is integral to our mission of improving lives through the curative potential of gene therapy. We are firmly committed to providing equal opportunity in all aspects of employment and aim for appropriate representation of gender, race and ethnicity at every level of our company.
Equal Opportunity We believe that a diverse, equitable and inclusive culture fosters innovation, which is integral to our mission of improving lives through the curative potential of gene therapy. We have worked to ensure equal opportunity in all aspects of employment and appropriate merit-based representation of gender, race and ethnicity throughout our company.
Wilson at Penn prior to February 2009, pursuant to a sponsored research agreement or subsequent amendment to a sponsored research agreement; or • are necessary or useful for the practice of Penn’s patent rights in the treatment of CLN2 disease, a form of Batten disease, and conceived and reduced to practice since October 2015; and • are owned and controlled by Penn. 11 Table of Contents Prior to entering into the license agreement with us, Penn had entered into two license agreements with third parties with respect to certain of the licensed patents and patent applications.
Wilson at Penn prior to February 2009, pursuant to a sponsored research agreement or subsequent amendment to a sponsored research agreement; or • are necessary or useful for the practice of Penn’s patent rights in the treatment of CLN2 disease, a form of Batten disease, and conceived and reduced to practice since October 2015; and • are owned and controlled by Penn.
We are designing new NAV Vectors with new features that may enhance tissue and cell type specificity, increase potency and potentially improve the safety profile of AAV Therapeutics.
We are also engineering novel capsids by leveraging the natural diversity of our NAV Vectors and our detailed knowledge of AAV structure and function. We are designing new NAV Vectors with new features that may enhance tissue and cell type specificity, increase potency and potentially improve the safety profile of AAV Therapeutics.
In December 2020, we sold a portion of our royalty rights from the net sales of Zolgensma to entities managed by Healthcare Royalty Management, LLC (HCR) for a gross purchase price of $200 million. As of December 31, 2023, Zolgensma is approved in 51 countries and over 3,700 patients have been treated.
In December 2020, we sold a portion of our royalty rights from the net sales of Zolgensma to entities managed by Healthcare Royalty Management, LLC (HCR) for a gross purchase price of $200 million.
We entered into a license agreement with each of these NAV Technology Licensees upon their formation, for which we received equity in the NAV Technology Licensee in addition to other consideration. In November 2017, Ultragenyx Pharmaceutical Inc. (Ultragenyx) acquired Dimension for 10 Table of Contents approximately $152 million in cash.
We entered into a license agreement with each of these NAV Technology Licensees upon their formation, for which we received equity in the NAV Technology Licensee in addition to other consideration.
Wilson relating to AAV gene therapy and obtained an option to acquire an exclusive worldwide license in certain intellectual property created pursuant to such 2009 SRA. We entered into an additional sponsored research agreement (the 2013 SRA) with Penn in November 2013 which was funded entirely by our NAV Technology Licensee, Dimension.
In February 2009, we also entered into a sponsored research agreement with Penn (the 2009 SRA) under which we funded the nonclinical research of Dr. Wilson relating to AAV gene therapy and obtained an option to acquire an exclusive worldwide license in certain intellectual property created pursuant to such 2009 SRA.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisks Related to Our Intellectual Property • Our intellectual property rights may be limited by the terms and conditions of licenses granted to us by others. • We must obtain and maintain patent protection for our products and technology to protect our intellectual property rights. • Our intellectual property licenses with third parties may be subject to disagreements. • We are required to comply with the agreements under which we license intellectual property rights from third parties. • We may not be successful in obtaining necessary rights to our product candidates through acquisitions and in-licenses. • We may not be able to protect our intellectual property rights in the United States and throughout the world. • Issued patents covering our NAV Technology Platform or our product candidates could be found invalid or unenforceable. • Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights. • We may be subject to intellectual property claims. • Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our products. • We may be unable to obtain patent term extension and data exclusivity for our product candidates. 30 Table of Contents Risks Related to Ownership of Our Common Stock • Our operating results are difficult to predict and could cause the price of our common stock to fluctuate substantially. • Raising additional capital may cause dilution to our existing stockholders, restrict our operations or require us to relinquish proprietary rights. • Future acquisitions or strategic partnerships may increase our capital requirements, dilute our stockholders, cause us to incur debt or assume contingent liabilities and subject us to other risks. • Provisions in our certificate of incorporation and bylaws might discourage, delay or prevent a change in control. • Our certificate of incorporation includes exclusive forum clauses for certain litigation. • Our business could be negatively affected as a result of the actions of activist stockholders.
Biggest changeRisks Related to Our Intellectual Property • Our intellectual property rights may be limited by the terms and conditions of licenses granted to us by others. • We must obtain and maintain patent protection for our products and technology to protect our intellectual property rights. • Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed. • Our intellectual property licenses with third parties may be subject to disagreements. • We are required to comply with the agreements under which we license intellectual property rights from third parties. • We may not be successful in obtaining necessary rights to our product candidates through acquisitions and in-licenses. • We may not be able to protect our intellectual property rights in the United States and throughout the world. • Issued patents covering our NAV Technology Platform or our product candidates could be found invalid or unenforceable. • Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights. • We may be subject to intellectual property claims. • Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our products. • We may be unable to obtain patent term extension and data exclusivity for our product candidates.
If we or any of our future development partners are unable to develop, or obtain regulatory approval for, or, if approved, successfully commercialize, our lead product candidates, we may not be able to generate sufficient revenue to continue our business.
If we or any of our future development partners are unable to develop, obtain regulatory approval for, or, if approved, successfully commercialize, our lead product candidates, we may not be able to generate sufficient revenue to continue our business.
Because we are developing product candidates for the treatment of certain diseases in which there is little clinical experience and we are using new endpoints and methodologies, there is increased risk that the FDA, the EMA or other regulatory authorities may not consider the endpoints of our clinical trials to provide clinically meaningful results and that these results may be difficult to analyze.
Because we are developing certain product candidates for the treatment of diseases in which there is little clinical experience and we are using new endpoints and methodologies, there is increased risk that the FDA, the EMA or other regulatory authorities may not consider the endpoints of our clinical trials to provide clinically meaningful results and that these results may be difficult to analyze.
Risks Related to Third Parties We rely on third parties to conduct certain preclinical research and development activities and aspects of our clinical trials. If these third parties do not meet our deadlines or otherwise conduct the preclinical research and development activities and trials as required, our preclinical and clinical development programs could be delayed or unsuccessful.
Risks Related to Third Parties We rely on third parties to conduct aspects of our clinical trials and certain preclinical research development activities. If these third parties do not meet our deadlines or otherwise conduct the preclinical research and development activities and trials as required, our clinical and preclinical development programs could be delayed or unsuccessful.
If we or any of our third-party manufacturers fail to comply with applicable cGMP regulations, regulatory authorities can impose regulatory sanctions including, among other things, refusal to approve a pending application for a new product candidate or suspension or revocation of a pre-existing approval.
If we or any of our third-party manufacturers fail to comply with applicable cGMP regulations, regulatory authorities can impose sanctions including, among other things, refusal to approve a pending application for a new product candidate or suspension or revocation of a pre-existing approval.
The future regulatory and commercial success of these product candidates is subject to a number of risks, including the following: • we may not have sufficient financial and other resources or patient availability to complete the necessary clinical trials for our lead product candidates ; • we may not be able to provide evidence of quality, efficacy and safety for our lead product candidates ; • we do not know the degree to which our lead product candidates will be accepted by patients, the medical community and third-party payors as a therapy for the respective diseases to which they relate, even if approved ; • the results of our clinical trials may not meet the level of statistical or clinical significance required by the FDA, EMA or comparable foreign regulatory bodies for marketing approval, and modifications to the design of our clinical trials could delay their enrollment, commencement or completion ; • subjects in our clinical trials may die or suffer other adverse effects for reasons that may or may not be related to our lead product candidates ; • subjects in clinical trials undertaken by our licensees or collaborators, or undertaken by others using AAV, may die or suffer other adverse effects for reasons that may or may not be related to our NAV Technology Platform or AAV ; • certain patients’ immune systems might prohibit the successful delivery of certain gene therapy products to the target tissue, thereby limiting the treatment outcomes ; • we may not successfully establish commercial manufacturing capabilities; • if approved for treatment of the expected conditions, our lead product candidates will likely compete with other treatments then available, including the off-label use of products already approved for marketing and other therapies currently available or which may be developed ; • our products and products developed by our licensees and collaborators may not maintain a continued acceptable safety profile following regulatory approval ; • we may not maintain compliance with post-approval regulation and other requirements ; and • we may not be able to obtain, maintain or enforce our rights under our licensed patents and other intellectual property rights .
The future regulatory and commercial success of these product candidates is subject to a number of risks, including the following: • we may not have sufficient financial and other resources or patient availability to complete the necessary clinical trials for our lead product candidates ; • we may not be able to provide evidence of quality, efficacy and safety for our lead product candidates ; 32 • we do not know the degree to which our lead product candidates will be accepted by patients, the medical community and third-party payors as a therapy for the respective diseases to which they relate, even if approved ; • the results of our clinical trials may not meet the level of statistical or clinical significance required by the FDA, EMA or comparable foreign regulatory bodies for marketing approval, and modifications to the design of our clinical trials could delay their enrollment, commencement or completion ; • subjects in our clinical trials may die or suffer other adverse effects for reasons that may or may not be related to our lead product candidates ; • subjects in clinical trials undertaken by our licensees or collaborators, or undertaken by others using AAV, may die or suffer other adverse effects for reasons that may or may not be related to our NAV Technology Platform or AAV ; • certain patients’ immune systems might prohibit the successful delivery of certain gene therapy products to the target tissue, thereby limiting the treatment outcomes ; • we may not successfully establish commercial manufacturing capabilities; • if approved for treatment of the expected conditions, our lead product candidates will likely compete with other treatments then available, including the off-label use of products already approved for marketing and other therapies currently available or which may be developed ; • our products and products developed by our licensees and collaborators may not maintain a continued acceptable safety profile following regulatory approval ; • we may not maintain compliance with post-approval regulation and other requirements ; and • we may not be able to obtain, maintain or enforce our rights under our licensed patents and other intellectual property rights .
PPACA provides and recent government cases against pharmaceutical and medical device manufacturers support the view that federal Anti-Kickback Statute violations and certain marketing practices, including off-label promotion, may implicate the False Claims Act; • HIPAA, which created new federal criminal statutes that prohibit a person from knowingly and willfully executing a scheme or from making false or fraudulent statements to defraud any healthcare benefit program, regardless of the payor (e.g., public or private); • HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (HITECH), and its implementing regulations, and as amended again by the final HIPAA omnibus rule, Modifications to the HIPAA Privacy, Security, Enforcement, and Breach Notification Rules Under HITECH and the Genetic Information Nondiscrimination Act; • Other Modifications to HIPAA, which imposes certain requirements relating to the privacy, security and transmission of individually identifiable health information without appropriate authorization by entities subject to the rule, such as health plans, health care clearinghouses and health care providers; • federal transparency laws, including the federal Physician Payment Sunshine Act, that require disclosure of payments and other transfers of value provided to physicians and teaching hospitals, and ownership and investment interests held by physicians and other healthcare providers and their immediate family members and applicable group purchasing organizations; 50 Table of Contents • national laws, industry codes and professional codes of conduct applicable to certain European Union Member States which require payments made to physicians to be publicly disclosed and agreements with physicians to often be the subject of prior notification and approval by the physicians’ employer, his or her competent professional organization and/or the regulatory authorities of the individual Member States; • federal, state and foreign laws relating to the processing, storage and transfer of personal data, including, but not limited to, the California Consumer Privacy Act and the European Union’s General Data Protection Regulation, which may require us to incur substantial costs or change our business practices with respect to the treatment of personal data; and • state and foreign law equivalents of each of the above federal laws, state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures and state 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 in certain circumstances, such as specific disease states.
PPACA provides and recent government cases against pharmaceutical and medical device manufacturers support the view that federal Anti-Kickback Statute violations and certain marketing practices, including off-label promotion, may implicate the False Claims Act; • HIPAA, which created new federal criminal statutes that prohibit a person from knowingly and willfully executing a scheme or from making false or fraudulent statements to defraud any healthcare benefit program, regardless of the payor (e.g., public or private); • HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (HITECH), and its implementing regulations, and as amended again by the final HIPAA omnibus rule, Modifications to the HIPAA Privacy, Security, Enforcement, and Breach Notification Rules Under HITECH and the Genetic Information Nondiscrimination Act; • Other Modifications to HIPAA, which imposes certain requirements relating to the privacy, security and transmission of individually identifiable health information without appropriate authorization by entities subject to the rule, such as health plans, health care clearinghouses and health care providers; • federal transparency laws, including the federal Physician Payment Sunshine Act, that require disclosure of payments and other transfers of value provided to physicians and teaching hospitals, and ownership and investment interests held by physicians and other healthcare providers and their immediate family members and applicable group purchasing organizations; • national laws, industry codes and professional codes of conduct applicable to certain European Union Member States which require payments made to physicians to be publicly disclosed and agreements with physicians to often be the subject of prior notification and approval by the physicians’ employer, his or her competent professional organization and/or the regulatory authorities of the individual Member States; • federal, state and foreign laws relating to the processing, storage and transfer of personal data, including, but not limited to, the California Consumer Privacy Act and the European Union’s General Data Protection Regulation, which may require us to incur substantial costs or change our business practices with respect to the treatment of personal data; and • state and foreign law equivalents of each of the above federal laws, state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures and state 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 in certain circumstances, such as specific disease states.
If our operations are found to be in violation of any of the laws described above or any other government regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from participation in government health care programs, such as Medicare and Medicaid, imprisonment, reputational harm, public reprimands, third-party actions, such as cease and desist letters or injunctions, and the curtailment or restructuring of our operations, any of which could harm our ability to operate our business and our results of operations.
If our operations are found to be in violation of any of the laws described above or any other government regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from participation in government health care programs, such as Medicare and Medicaid, reputational harm, public reprimands, third-party actions, such as cease and desist letters or injunctions, and the curtailment or restructuring of our operations, any of which could harm our ability to operate our business and our results of operations.
Risk Factor Summary Risks Related to Our NAV Technology Platform and the Development of Our Product Candidates • It is difficult to predict the time and cost of development and of obtaining regulatory approval for our product candidates. • Our business depends substantially on the success of our lead product candidates. • We have limited clinical results for most of our product candidates. • Regulatory authorities may not consider the endpoints of our clinical trials to provide clinically meaningful results. • The results from our preclinical studies or clinical trials for our product candidates may not support as broad a marketing approval as we seek, and we may be required to conduct additional clinical trials or evaluate subjects for a follow-up period. • We may encounter substantial delays in our planned clinical trials, or we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities. • We may be negatively impacted if the results of our planned clinical trials are inconclusive or if there are safety concerns or serious adverse events associated with our product candidates. • Undesirable side effects may delay or prevent our product candidates and those of our licensees or collaborators from obtaining regulatory approval, limit their commercial potential or result in significant negative consequences following approval. • We cannot predict when, or if, we will obtain regulatory approval to commercialize a product candidate.
Risk Factor Summary Risks Related to Our NAV Technology Platform and the Development of Our Product Candidates • It is difficult to predict the time and cost of development and of obtaining regulatory approval for our product candidates. • Our business depends substantially on the success of our lead product candidates. • We have limited clinical results for some of our product candidates. • Regulatory authorities may not consider the endpoints of our clinical trials to provide clinically meaningful results. • The results from our preclinical studies or clinical trials for our product candidates may not support as broad a marketing approval as we seek, and we may be required to conduct additional clinical trials or evaluate subjects for a follow-up period. • We may encounter substantial delays in our planned clinical trials, or we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities. • We may be negatively impacted if the results of our planned clinical trials are inconclusive or if there are safety concerns or serious adverse events associated with our product candidates. • Undesirable side effects may delay or prevent our product candidates and those of our licensees or collaborators from obtaining regulatory approval, limit their commercial potential or result in significant negative consequences following approval. • We cannot predict when, or if, we will obtain regulatory approval to commercialize a product candidate.
Our ability to generate future revenues from sales of our product candidates and in connection with sales of our licensees’ and collaborators’ products depends heavily on our, and our licensees’ and collaborators’, success in: • completing research studies and preclinical and clinical development of product candidates and identifying new gene therapy product candidates; • obtaining regulatory and marketing approvals for product candidates for which clinical trials are completed; • commercializing product candidates for which regulatory and marketing approval is obtained by establishing a sales force, marketing and distribution infrastructure or, alternatively, collaborating with a commercialization partner; • negotiating favorable terms in any collaboration, licensing or other arrangements into which we or our licensees and collaborators may enter and performing our obligations in such collaborations; • qualifying for adequate coverage and reimbursement by government and third-party payors for product candidates; • maintaining and enhancing a sustainable, scalable, reproducible and transferable manufacturing process for our vectors and product candidates; • establishing and maintaining supply and manufacturing relationships with third parties that can provide adequate, in both amount and quality, products and services to support clinical development and the market demand for product candidates, if approved; 39 Table of Contents • obtaining market acceptance of product candidates as a viable treatment option; • competing effectively when other companies may develop products that are priced lower, reimbursed more favorably by government or other third-party payors, safer, more effective or more convenient to use than our products, if any, or our licensees’ and collaborators’ products; • implementing additional internal systems and infrastructure, as needed; • negotiating favorable terms in any collaboration, licensing or other arrangements into which we may enter and performing our obligations in such collaborations; • maintaining, protecting and expanding our portfolio of intellectual property rights, including patents, trade secrets and know-how; • avoiding and defending against third-party interference, infringement and other intellectual property related claims; and • attracting, hiring and retaining qualified personnel.
Our ability to generate future revenues from sales of our product candidates and in connection with sales of our licensees’ and collaborators’ products depends heavily on our, and our licensees’ and collaborators’, success in: • completing research studies and preclinical and clinical development of product candidates and identifying new gene therapy product candidates; • obtaining regulatory and marketing approvals for product candidates for which clinical trials are completed; • commercializing product candidates for which regulatory and marketing approval is obtained by establishing a sales force, marketing and distribution infrastructure or, alternatively, collaborating with a commercialization partner; • negotiating favorable terms in any collaboration, licensing or other arrangements into which we or our licensees and collaborators may enter and performing our obligations in such collaborations; • qualifying for adequate coverage and reimbursement by government and third-party payors for product candidates; • maintaining and enhancing a sustainable, scalable, reproducible and transferable manufacturing process for our vectors and product candidates; • establishing and maintaining supply and manufacturing relationships with third parties that can provide adequate, in both amount and quality, products and services to support clinical development and the market demand for product candidates, if approved; • obtaining market acceptance of product candidates as a viable treatment option; • competing effectively when other companies may develop products that are priced lower, reimbursed more favorably by government or other third-party payors, safer, more effective or more convenient to use than our products, if any, or our licensees’ and collaborators’ products; • implementing additional internal systems and infrastructure, as needed; • negotiating favorable terms in any collaboration, licensing or other arrangements into which we may enter and performing our obligations in such collaborations; • maintaining, protecting and expanding our portfolio of intellectual property rights, including patents, trade secrets and know-how; • avoiding and defending against third-party interference, infringement and other intellectual property related claims; and • attracting, hiring and retaining qualified personnel.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for our technology, including any product candidates that we may develop; • loss of revenue; • substantial monetary awards to trial participants or patients; • significant time and costs to defend the related litigation; • withdrawal of clinical trial participants; • the inability to license our NAV Technology Platform or commercialize any product candidates that we may develop; and • injury to our reputation and significant negative media attention.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for our technology, including any product candidates that we may develop; • loss of revenue; 50 • substantial monetary awards to trial participants or patients; • significant time and costs to defend the related litigation; • withdrawal of clinical trial participants; • the inability to license our NAV Technology Platform or commercialize any product candidates that we may develop; and • injury to our reputation and significant negative media attention.
Liability may be established under the federal Anti-Kickback Statute without proving actual knowledge of the statute or specific intent to violate it; • federal civil and criminal false claims laws and civil monetary penalty laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid or other government payors that are false or fraudulent.
Liability may be established under the federal Anti-Kickback Statute without proving actual knowledge of the statute or specific intent to violate it; 49 • federal civil and criminal false claims laws and civil monetary penalty laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid or other government payors that are false or fraudulent.
The FDA’s guidance allows for two exceptions to the general rule of concurrent drug/device approval, namely, when the therapeutic product is intended to treat serious and life-threatening conditions for which no alternative exists, and when a serious safety issue arises for an approved therapeutic agent, and no FDA-cleared or FDA-approved companion diagnostic test is yet available.
The FDA’s guidance allows for two exceptions to the general rule of concurrent drug/device approval, namely, when the therapeutic product is intended to treat serious and life-threatening conditions for which no alternative exists, and when a serious safety issue arises for an approved therapeutic 36 agent, and no FDA-cleared or FDA-approved companion diagnostic test is yet available.
If we are successful in executing our business strategy, we will need to expand our managerial, operational, financial and other systems and resources to manage our operations, continue our research and development and licensing activities, and, in the longer term, build a sales and marketing infrastructure to support commercialization of any of our product candidates that are approved for sale.
If we are successful in executing our business strategy, we will need to expand our managerial, operational, financial, compliance and other systems and resources to manage our operations, continue our research and development and licensing activities, and, in the longer term, build a sales and marketing infrastructure to support commercialization of any of our product candidates that are approved for sale.
To the extent that any disruption or security breach results in a loss of, or damage to, our trade secrets, data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability, our competitive position could be harmed and the further licensing of our NAV Technology Platform and development and commercialization of our product candidates could be delayed.
To the extent that any disruption or security breach results in a loss of, or damage to, our trade secrets, data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability, our competitive position could be harmed 51 and the further licensing of our NAV Technology Platform and development and commercialization of our product candidates could be delayed.
Any potential acquisition or strategic partnership may entail numerous risks, including: • increased operating expenses and cash requirements; 60 Table of Contents • the assumption of additional indebtedness or contingent liabilities; • the issuance of our equity securities; • assimilation of operations, intellectual property and products of an acquired company, including difficulties associated with integrating new personnel; • the diversion of our management's attention from our existing product programs and initiatives in pursuing such a strategic merger or acquisition; • retention of key employees, the loss of key personnel, and uncertainties in our ability to maintain key business relationships; • risks and uncertainties associated with the other party to such a transaction, including the prospects of that party and their existing products or product candidates and regulatory approvals; and • our inability to generate revenue from acquired technology and/or products sufficient to meet our objectives in undertaking the acquisition or even to offset the associated acquisition and maintenance costs.
Any potential acquisition or strategic partnership may entail numerous risks, including: • increased operating expenses and cash requirements; 60 • the assumption of additional indebtedness or contingent liabilities; • the issuance of our equity securities; • assimilation of operations, intellectual property and products of an acquired company, including difficulties associated with integrating new personnel; • the diversion of our management’s attention from our existing product programs and initiatives in pursuing such a strategic merger or acquisition; • retention of key employees, the loss of key personnel, and uncertainties in our ability to maintain key business relationships; • risks and uncertainties associated with the other party to such a transaction, including the prospects of that party and their existing products or product candidates and regulatory approvals; and • our inability to generate revenue from acquired technology and/or products sufficient to meet our objectives in undertaking the acquisition or even to offset the associated acquisition and maintenance costs.
Without an internal team or the support of a third party to perform marketing and sales functions, we may be unable to compete successfully against these more established companies. Our efforts to educate the medical community and third-party payors on the benefits of our product candidates may require significant resources and may never be successful.
Without an adequate internal team or the support of a third party to perform marketing and sales functions, we may be unable to compete successfully against these more established companies. Our efforts to educate the medical community and third-party payors on the benefits of our product candidates may require significant resources and may never be successful.
We may need to raise additional funding, which may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate certain of our licensing activities, product development efforts or other operations.
We will need to raise additional funding, which may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate certain of our licensing activities, product development efforts or other operations.
If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, financial condition, results of operations and prospects, including the imposition of significant fines or other sanctions.
If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could have a significant adverse impact on our business, financial condition, results of operations and prospects, including the imposition of significant fines or other sanctions.
Changes in either the patent laws or interpretation of the patent laws in the United States and other countries may diminish the value of our patents or narrow the scope of our patent protection. We may not be aware of all third-party intellectual property rights potentially relating to our technology and product candidates.
Changes in either the patent laws or interpretation of the patent laws in the United States and other countries may diminish the value of our patents or narrow the scope of our patent protection. 53 We may not be aware of all third-party intellectual property rights potentially relating to our technology and product candidates.
Risks Related to Our Financial Position • We face significant competition and there is a possibility that our competitors may achieve regulatory approval before us or develop products that are safer, less expensive or more convenient or effective than ours. • We expect to normally incur losses for the foreseeable future and may never again achieve or maintain profitability. • Failure to obtain additional funding when needed may force us to delay, limit or terminate certain of our licensing activities, product development efforts or other operations. • We have never generated revenue from sales of our product candidates and may never do so in the future.
Risks Related to Our Financial Position • We face significant competition and there is a possibility that our competitors may achieve regulatory approval before us or develop products that are safer, less expensive or more convenient or effective than ours. • We expect to regularly incur losses for the foreseeable future and may never again achieve or maintain profitability. • Failure to obtain additional funding when needed may force us to delay, limit or terminate certain of our licensing activities, product development efforts or other operations. • We have never generated revenue from sales of our product candidates and may never do so in the future.
We may encounter substantial delays in our planned clinical trials, or we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities. Before obtaining marketing approval from regulatory authorities for the sale of our product candidates, we must conduct extensive clinical trials to demonstrate the safety and efficacy of the product candidates.
We may encounter substantial delays in our planned clinical trials, or we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities. Before obtaining marketing approval from regulatory authorities for the sale of our product candidates, we must conduct extensive clinical trials to demonstrate their safety and efficacy.
The cGMP requirements govern quality control of the manufacturing process and documentation policies and procedures. In complying with cGMP, we will be obligated to expend time, money and effort in production, record keeping and quality control to assure that the product meets applicable specifications and other requirements.
The cGMP requirements govern quality control 43 of the manufacturing process and documentation policies and procedures. In complying with cGMP, we will be obligated to expend time, money and effort in production, record keeping and quality control to assure that the product meets applicable specifications and other requirements.
Specifically, we rely on third parties to conduct a portion of our preclinical research and development activities and we may also rely on CROs, medical institutions, clinical investigators, consultants or other third parties to conduct our clinical trials in accordance with our clinical protocols and regulatory requirements.
We also rely on third parties to conduct a portion of our preclinical research and development activities and we may also rely on CROs, medical institutions, clinical investigators, consultants or other third parties to conduct our clinical trials in accordance with our clinical protocols and regulatory requirements.
We currently rely and expect to continue to rely on third parties to conduct our product manufacturing, and these third parties may not perform satisfactorily. We currently plan to have some of the material manufactured for our planned preclinical and clinical programs by third parties.
We currently rely and expect to continue to rely on third parties to conduct parts of our product manufacturing, and these third parties may not perform satisfactorily. We currently plan to have some of the material manufactured for our planned preclinical and clinical programs by third parties.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management. 58 Table of Contents In addition, while it is our policy to require our employees and contractors who may be involved in the conception or development of intellectual property to execute agreements assigning such intellectual property to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own.
Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management. 58 In addition, while it is our policy to require our employees and contractors who may be involved in the conception or development of intellectual property to execute agreements assigning such intellectual property to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own.
Should our product candidates be approved and covered by Medicare Part B or Part D, and fail to fall within a statutory exclusion, such as that for an orphan drug, those products could, after a period of time (e.g., 13 years after FDA approval of biologics, including gene therapies), be selected for negotiation and become subject to prices representing a significant discount from average prices to wholesalers and direct purchasers.
Should our product candidates be approved and covered by Medicare Part B or Part D, and fail to fall within a statutory exclusion, such as that for an orphan drug, those products could, after a period of time (e.g., 11 years after FDA approval of biologics, including gene therapies), be selected for negotiation and become subject to prices representing a significant discount from average prices to wholesalers and direct purchasers.
If we do not meet these milestones as publicly announced, or at all, the commercialization of our products may be delayed or never achieved and, as a result, our stock price may decline. 45 Table of Contents Even if we receive regulatory approval, we still may not be able to successfully commercialize our lead product candidates or any future product candidate, and the revenue that we generate from any approved product’s sales, if any, could be limited.
If we do not meet these milestones as publicly announced, or at all, the commercialization of our products may be delayed or never achieved and, as a result, our stock price may decline. 45 Even if we receive regulatory approval, we still may not be able to successfully commercialize our lead product candidates or any future product candidate, and the revenue that we generate from any approved product’s sales, if any, could be limited.
Our success depends, in large part, on our ability to obtain and maintain patent protection in the United States and other countries with respect to our proprietary NAV Technology Platform, our product candidates and our manufacturing technology.
Our success depends, in part, on our ability to obtain and maintain patent protection in the United States and other countries with respect to our proprietary NAV Technology Platform, our product candidates and our manufacturing technology.
Section 203 imposes certain restrictions on merger, business combinations and other transactions between us and holders of 15% or more of our common stock. 61 Table of Contents Our restated certificate of incorporation includes exclusive forum clauses for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
Section 203 imposes certain restrictions on merger, business combinations and other transactions between us and holders of 15% or more of our common stock. 61 Our restated certificate of incorporation includes exclusive forum clauses for certain litigation that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
As we are developing novel treatments for diseases in which there is little clinical experience with new endpoints and methodologies, there is heightened risk that the FDA, the EMA or other regulatory bodies may not consider the clinical trial endpoints to provide clinically meaningful results (reflecting a tangible benefit to patients).
As we are developing novel treatments for diseases in which there is little clinical experience with new endpoints and methodologies, there is heightened risk that the FDA, the 33 EMA or other regulatory bodies may not consider the clinical trial endpoints that we select to provide clinically meaningful results (reflecting a tangible benefit to patients).
Regulatory authorities also may require additional trials if a new manufacturer is relied upon for commercial production. Switching manufacturers may involve substantial costs and could result in a delay in our desired clinical and commercial timelines. 44 Table of Contents Given the nature of biologics manufacturing, there is a risk of contamination during manufacturing.
Regulatory authorities also may require additional trials if a new manufacturer is relied upon for commercial production. Switching manufacturers may involve substantial costs and could result in a delay in our desired clinical and commercial timelines. 44 Given the nature of biologics manufacturing, there is a risk of contamination during manufacturing.
Unauthorized disclosure of sensitive or confidential patient or employee data, including personally identifiable information, whether through breach of computer systems, systems failure, employee negligence, fraud or misappropriation, or otherwise, or unauthorized access to or through our information systems and networks, whether by our employees or third parties, could result in negative publicity, legal liability and damage to our reputation.
Unauthorized disclosure of sensitive or confidential patient or employee data, including personally identifiable information, whether through breach of information technology systems, systems failure, employee negligence, fraud or misappropriation, or otherwise, or unauthorized access to or through our information systems and networks, whether by our employees or third parties, could result in negative publicity, legal liability and damage to our reputation.
We anticipate that our expenses will increase substantially if, and as, we: • continue our research studies and preclinical and clinical development of our product candidates, including our lead product candidates; 37 Table of Contents • initiate additional preclinical studies and clinical trials for our lead product candidates and future product candidates, if any; • initiate additional activities relating to manufacturing, including building out additional laboratory and manufacturing capacity; • seek to identify additional product candidates; • prepare our BLA and MAA for our lead product candidates and seek marketing approvals for any of our other product candidates that successfully complete clinical trials, if any; • further develop our NAV Technology Platform; • establish a sales, marketing and distribution infrastructure to commercialize any product candidates for which we may obtain marketing approval, if any; • maintain, expand and protect our intellectual property portfolio and enforce our intellectual property rights; and • acquire or in-license other product candidates and technologies.
We anticipate that our expenses will increase substantially if, and as, we: • continue our research studies and preclinical and clinical development of our product candidates, including our lead product candidates; • initiate additional preclinical studies and clinical trials for our lead product candidates and future product candidates, if any; • initiate additional activities relating to manufacturing, including building out additional laboratory and manufacturing capacity; • seek to identify additional product candidates; • prepare our BLA and MAA for our lead product candidates and seek marketing approvals for any of our other product candidates that successfully complete clinical trials, if any; • further develop our NAV Technology Platform; • establish a sales, marketing and distribution infrastructure to commercialize any product candidates for which we may obtain marketing approval, if any; 38 • maintain, expand and protect our intellectual property portfolio and enforce our intellectual property rights; and • acquire or in-license other product candidates and technologies.
The establishment and development of our own commercial team or the establishment of a contract sales force to market any products we may develop will be expensive and time-consuming and could delay any product launch. Moreover, we cannot be certain that we will be able to successfully develop this capability.
The expansion of our own commercial team or the establishment of a contract sales force to market any products we may develop will be expensive and time-consuming and could delay any product launch. Moreover, we cannot be certain that we will be able to successfully develop this capability.
For example, any academic institution that we collaborate with, or may collaborate with in the future, will sometimes be granted rights to publish data arising out of such collaboration, provided that we are notified in advance and given the opportunity to delay publication 42 Table of Contents for a limited time period in order for us to secure patent protection of intellectual property rights arising from the collaboration, in addition to the opportunity to remove confidential or trade secret information from any such publication.
For example, any academic institution that we collaborate with, or may collaborate with in the future, will sometimes be granted rights to publish data arising out of such collaboration, provided that we are notified in advance and given the opportunity to delay publication for a limited time period in order for us to secure patent protection of intellectual property rights arising from the collaboration, in addition to the opportunity to remove confidential or trade secret information from any such publication.
Such proceedings could result in the revocation or cancellation of or amendment to our patents in such a way that they no longer cover our NAV Technology 57 Table of Contents Platform or our product candidates. The outcome following legal assertions of invalidity and unenforceability is unpredictable.
Such proceedings could result in the revocation or cancellation of or amendment to our patents in such a way that they no longer cover our NAV Technology 57 Platform or our product candidates. The outcome following legal assertions of invalidity and unenforceability is unpredictable.
Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future, regardless of their merit. There is a risk that third parties may choose to engage in litigation with us to enforce or to otherwise assert their patent rights against us.
Third parties may assert infringement claims against us or our collaborators based on existing patents or patents that may be granted in the future, regardless of their merit. There is a risk that third parties may choose to engage in litigation with us or our collaborators to enforce or to otherwise assert their patent rights against us.
We have limited clinical results for most of our product candidates and success in preclinical studies or early clinical trials may not be indicative of results obtained in later trials. Gene therapy development has inherent risks. Most of our lead product candidates have limited clinical and preclinical results and we may experience unexpected results in the future.
We have limited clinical results for some of our product candidates and success in preclinical studies or early clinical trials may not be indicative of results obtained in later trials. Gene therapy development has inherent risks. Some of our lead product candidates have limited clinical and preclinical results and we may experience unexpected results in the future.
In addition, there could be 56 Table of Contents public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could materially harm the price of our common stock.
In addition, there could be 56 public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could materially harm the price of our common stock.
Events that may prevent successful or timely commencement and completion of preclinical and clinical development include: • delays in reaching a consensus with regulatory authorities on trial design; • delays in reaching agreement on acceptable terms with prospective CROs and clinical trial sites; • delays in opening clinical trial sites or obtaining required institutional review board or independent Ethics Committee approval at each clinical trial site; • delays in recruiting and enrolling suitable subjects to participate in our clinical trials, due to factors such as the size of the trial or subject population, process for identifying subjects, design or expansion of protocols, eligibility and exclusive criteria, perceived risks and benefits of the relevant product candidate or gene therapy generally, availability of competing therapies and trials, severity of the disease under investigation, need and length of time required to discontinue other potential therapies, availability of genetic testing, availability and proximity of trial sites for prospective subjects, ability to obtain subject consent and referral practices of physicians; 33 Table of Contents • imposition of a clinical hold by regulatory authorities, including as a result of a serious adverse event or after an inspection of our clinical trial operations or trial sites; • failure by us, any CROs we engage or any other third parties to adhere to clinical trial requirements; • failure to perform in accordance with GCP, or applicable regulatory guidelines in the European Union and other countries; • delays in the testing, validation, manufacturing and delivery of our product candidates to the clinical sites, including delays by third parties with whom we have contracted to perform; • delays in having subjects complete participation in a trial or return for post-treatment follow-up; • clinical trial sites or subjects dropping out of a trial; • selection of clinical endpoints that require prolonged periods of clinical observation or analysis of the resulting data; • occurrence of serious adverse events associated with the product candidate that are viewed to outweigh its potential benefits; • occurrence of serious adverse events in trials of the same class of agents conducted by other sponsors; or • changes in regulatory requirements and guidance that require amending or submitting new clinical protocols.
Events that may prevent successful or timely commencement and completion of preclinical and clinical development include: • delays in reaching a consensus with regulatory authorities on trial design; • delays in reaching agreement on acceptable terms with prospective CROs and clinical trial sites; • delays in opening clinical trial sites or obtaining required institutional review board or independent Ethics Committee approval at each clinical trial site; • delays in recruiting and enrolling suitable subjects to participate in our clinical trials, due to factors such as the size of the trial or subject population, process for identifying subjects, design or expansion of protocols, eligibility and exclusive criteria, perceived risks and benefits of the relevant product candidate or gene therapy generally, availability of competing therapies and trials, severity of the disease under investigation, need and length of time required to discontinue other potential therapies, availability of genetic testing, availability and proximity of trial sites for prospective subjects, ability to obtain subject consent and referral practices of physicians; • imposition of a clinical hold by regulatory authorities; • failure by us, any CROs we engage or any other third parties to adhere to clinical trial requirements; • failure to perform in accordance with GCP, or applicable regulatory guidelines in the European Union and other countries; • delays in the testing, validation, manufacturing and delivery of our product candidates to the clinical sites, including delays by third parties with whom we have contracted to perform; • delays in having subjects complete participation in a trial or return for post-treatment follow-up; • clinical trial sites or subjects dropping out of a trial; • selection of clinical endpoints that require prolonged periods of clinical observation or analysis of the resulting data; • occurrence of serious adverse events associated with the product candidate that are viewed to outweigh its potential benefits; 34 • occurrence of serious adverse events in trials of the same class of agents conducted by other sponsors; or • changes in regulatory requirements and guidance that require amending or submitting new clinical protocols.
Patent and Trademark Office. 59 Table of Contents Risks Related to Ownership of Our Common Stock Our operating results may fluctuate substantially, which makes our future operating results difficult to predict and could cause the price of our common stock to fluctuate substantially. We expect our operating results to be subject to fluctuations.
Patent and Trademark Office. 59 Risks Related to Ownership of Our Common Stock Our operating results may fluctuate substantially, which makes our future operating results difficult to predict and could cause the price of our common stock to fluctuate substantially. We expect our operating results to be subject to fluctuations.
This variability and unpredictability could also result in our failing to meet the expectations of securities or industry analysts or investors for any period. If our operating results fall below the expectations of investors or analysts, the price of our common stock could decline substantially.
This variability and unpredictability could also result in our failure to meet the expectations of securities or industry analysts or investors for any period. If our operating results fall below the expectations of investors or analysts, the price of our common stock could decline substantially.
Any current or future licensing agreements or future collaborations we enter into may pose additional risks, including the following: • subjects in clinical trials undertaken by our licensees and collaborators may suffer adverse effects, including death; • our licensees and collaborators may not pursue development and commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the licensees’ or collaborators’ strategic focus or available funding or external factors, such as an acquisition, that divert resources or create competing priorities; • we may not have access to, or may be restricted from disclosing, certain information regarding product candidates being developed or commercialized under a collaboration and, consequently, may have limited ability to inform our stockholders about the status of such product candidates; • our licensees or collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidates if the licensees or collaborators believe that competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours; • product candidates developed in collaboration with us may be viewed by our licensees or collaborators as competitive with their own product candidates or products, which may cause licensees or collaborators to cease to devote resources to the commercialization of our product candidates; • a licensee or collaborator with marketing and distribution rights to one or more of our product candidates that achieve regulatory approval may not commit sufficient resources to the marketing and distribution of any such product candidate; • our licensees or collaborators may breach their reporting, payment, intellectual property or other obligations to us, which could prevent us from complying with our contractual obligations to GSK and Penn; • disagreements with licensees or collaborators, including disagreements over intellectual property and other proprietary rights, payment obligations, contract interpretation or the preferred course of development of any product candidates, may cause delays or termination of the research, development or commercialization of such product candidates, may lead to additional responsibilities for us with respect to such product candidates or may result in litigation or arbitration, any of which would be time-consuming and expensive and could potentially lessen the value of such agreements and collaborations; • our licensees or 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; • disputes may arise with respect to the ownership of our other rights to intellectual property developed pursuant to our licensing agreements or collaborations; • our licensees or collaborators may infringe or otherwise violate the intellectual property rights of third parties, which may expose us to litigation and potential liability; and • licensing agreements or collaborations may be terminated for the convenience of the licensee or collaborator and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates.
Any current or future licensing agreements or future collaborations we enter into may pose additional risks, including the following: • subjects in clinical trials undertaken by our licensees and collaborators may suffer adverse effects, including death; • our licensees and collaborators may not pursue development and commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the licensees’ or collaborators’ strategic focus or available funding or external factors, such as an acquisition, that divert resources or create competing priorities; • we may not have access to, or may be restricted from disclosing, certain information regarding product candidates being developed or commercialized under a collaboration and, consequently, may have limited ability to inform our stockholders about the status of such product candidates; 41 • our licensees or collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidates if the licensees or collaborators believe that competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours; • product candidates developed in collaboration with us may be viewed by our licensees or collaborators as competitive with their own product candidates or products, which may cause licensees or collaborators to cease to devote resources to the commercialization of our product candidates; • a licensee or collaborator with marketing and distribution rights to one or more of our product candidates that achieve regulatory approval may not commit sufficient resources to the marketing and distribution of any such product candidate; • our licensees or collaborators may breach their reporting, payment, intellectual property or other obligations to us, which could prevent us from complying with our contractual obligations to our upstream licensors; • disagreements with licensees or collaborators, including disagreements over intellectual property and other proprietary rights, payment obligations, contract interpretation or the preferred course of development of any product candidates, may cause delays or termination of the research, development or commercialization of such product candidates, may lead to additional responsibilities for us with respect to such product candidates or may result in litigation or arbitration, any of which would be time-consuming and expensive and could potentially lessen the value of such agreements and collaborations; • our licensees or 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; • disputes may arise with respect to the ownership of our other rights to intellectual property developed pursuant to our licensing agreements or collaborations; • depending on the terms of the licensing agreement, the licensee or collaborator may have sole discretion regarding material aspects of the development, marketing or sale of a product candidate; • our licensees or collaborators may infringe or otherwise violate the intellectual property rights of third parties, which may expose us to litigation and potential liability; and • licensing agreements or collaborations may be terminated for the convenience of the licensee or collaborator and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates.
Lastly, certain patients’ immune systems might prohibit the successful delivery of certain gene therapy products to the target tissue, thereby limiting the treatment outcomes. 46 Table of Contents The insurance coverage and reimbursement status of newly approved products is uncertain.
Lastly, certain patients’ immune systems might prohibit the successful delivery of certain gene therapy products to the target tissue, thereby limiting the treatment outcomes. 46 The insurance coverage and reimbursement status of newly approved products is uncertain.
Our customers are concentrated and therefore the loss of a significant customer may harm our business. Our current revenues are derived from a concentrated customer base. Our revenues for the years ended December 31, 2023 and 2022 consisted solely of license and royalty revenue.
Our customers are concentrated and therefore the loss of a significant customer may harm our business. Our current revenues are derived from a concentrated customer base. Our revenues for the years ended December 31, 2024 and 2023 consisted solely of license and royalty revenue.
We, our development partners, including our licensees and collaborators, and our third-party manufacturers and suppliers are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the 51 Table of Contents generation, handling, use, storage, treatment, manufacture, transportation and disposal of, and exposure to, hazardous materials and wastes, as well as laws and regulations relating to occupational health and safety.
We, our development partners, including our licensees and collaborators, and our third-party manufacturers and suppliers are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the generation, handling, use, storage, treatment, manufacture, transportation and disposal of, and exposure to, hazardous materials and wastes, as well as laws and regulations relating to occupational health and safety.
If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates. 55 Table of Contents We may not be successful in obtaining necessary rights to our product candidates through acquisitions and in-licenses.
If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates. 55 We may not be successful in obtaining necessary rights to our product candidates through acquisitions and in-licenses.
Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market could decrease our ability to generate product revenue, and our business, financial condition, results of operations and prospects would be materially harmed. 31 Table of Contents Our business depends substantially on the success of our lead product candidates.
Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market could decrease our ability to generate product revenue, and our business, financial condition, results of operations and prospects would be materially harmed. Our business depends substantially on the success of our lead product candidates.
The inflation rebates may require us to pay rebates if we increased the cost of a covered Medicare Part B or Part D covered product faster than the rate of inflation. At this time, we are unable to predict how these recent legislative changes or any future legislation might affect our business.
The inflation rebates may require us to pay rebates if we were to increase the cost of a covered Medicare Part B or Part D covered product faster than the rate of inflation. At this time, we are unable to predict how these recent legislative changes or any future legislation might affect our business.
Provisions in our restated certificate of incorporation and amended and restated bylaws and under Delaware law might discourage, delay or prevent a change in control of our company or changes in our board of directors and, therefore, depress our stock price.
Provisions in our certificate of incorporation and bylaws and under Delaware law might discourage, delay or prevent a change in control of our company or changes in our board of directors and, therefore, depress our stock price.
Among other things, these provisions: • establish a classified board of directors so that not all members of our board are elected at one time; • permit the board of directors to establish the number of directors; • provide that directors may only be removed “for cause”; • require super-majority voting to amend some provisions in our restated certificate of incorporation and amended and restated bylaws; • authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • eliminate the ability of our stockholders to call special meetings of stockholders; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; • provide that the board of directors is expressly authorized to adopt, amend or repeal our bylaws; and • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
Among other things, these provisions: • establish a classified board of directors so that not all members of our board are elected at one time; • permit the board of directors to establish the number of directors; • provide that directors may only be removed “for cause” and only upon the vote of the holders of at least two-thirds of our outstanding shares; • require super-majority voting to amend some provisions in our restated certificate of incorporation and amended and restated bylaws; • authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • eliminate the ability of our stockholders to call special meetings of stockholders; • prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders; • provide that the board of directors is expressly authorized to adopt, amend or repeal our bylaws; and • establish advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
The government can exercise its march-in rights if it determines that action is necessary because we fail to 53 Table of Contents achieve practical application of the government-funded technology, because action is necessary to alleviate health or safety needs, to meet requirements of federal regulations or to give preference to U.S. industry.
The government can exercise its march-in rights if it determines that action is necessary because we fail to achieve practical application of the government-funded technology, because action is necessary to alleviate health or safety needs, to meet requirements of federal regulations or to give preference to U.S. industry.
Risks Related to the Commercialization of Our Product Candidates If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our product candidates, if approved, we may be unable to generate any product revenue. We currently have no products to sell and therefore no product sales and marketing organization.
Risks Related to the Commercialization of Our Product Candidates If we are unable to adequately establish sales and marketing capabilities or enter into agreements with third parties to market and sell our product candidates, if approved, we may be unable to generate any product revenue. We currently have no products to sell.
Although we have generated significant revenues from licensing our NAV Technology Platform and our other intellectual property, such as our licensing pursuant to the AbbVie Collaboration and License Agreement, we have never generated revenue from sales of our product candidates and may never do so in the future.
Although we have generated significant revenues from licensing our NAV Technology Platform and our other intellectual property, such as our licensing pursuant to the AbbVie Collaboration and License Agreement and may do so under the Nippon Shinyaku Collaboration and License Agreement, we have never generated revenue from sales of our product candidates and may never do so in the future.
Risks Related to Manufacturing • Products intended for use in gene therapies are novel, complex and difficult to manufacture. 29 Table of Contents • Delays in obtaining regulatory approval of our manufacturing process or disruptions in our manufacturing process may delay or disrupt our commercialization efforts. • Third parties we rely upon to conduct our product manufacturing may not perform satisfactorily. • We are required to comply with ongoing manufacturing regulatory requirements.
Risks Related to Manufacturing • Products intended for use in gene therapies are novel, complex and difficult to manufacture. • Delays in obtaining regulatory approval of our manufacturing process or disruptions in our manufacturing process may delay or disrupt our commercialization efforts. • Third parties we rely upon to conduct our product manufacturing may not perform satisfactorily. 30 • We are required to comply with ongoing manufacturing regulatory requirements.
Drug development is a long, expensive and uncertain process, and delay or failure can occur at any stage of development, including after commencement of any of our clinical trials. 32 Table of Contents The results of preclinical studies and early clinical trials are not always predictive of future results.
Drug development is a long, expensive and uncertain process, and delay or failure can occur at any stage of development, including after commencement of any of our clinical trials. The results of preclinical studies and early clinical trials are not always predictive of future results.
Competitors also may obtain FDA or other regulatory approval for their products more rapidly or earlier than we may obtain approval for ours, which could result in our competitors establishing a strong market position before we are able to enter the market.
Competitors also may obtain FDA or other regulatory approval for their products more rapidly or earlier than we may obtain approval for ours, or have already obtained, which could result in our competitors establishing a strong market position before we are able to enter the market.
If we or any of our vendors, contract laboratories or suppliers are found to be out of compliance with cGMP, we may experience delays or disruptions in manufacturing while we work to remedy the violation or while 43 Table of Contents we work to identify suitable replacement vendors, contract laboratories or suppliers.
If we or any of our vendors, contract laboratories or suppliers are found to be out of compliance with cGMP, we may experience delays or disruptions in manufacturing while we work to remedy the violation or while we work to identify suitable replacement vendors, contract laboratories or suppliers.
If we fail to adequately monitor our third-party service providers’ and business partners’ performance, including for compliance with our agreements and regulatory and legal requirements, we may have to incur additional costs to correct errors, our reputation could be 52 Table of Contents harmed or we could be subject to litigation, claims, legal or regulatory proceedings, inquiries or investigations.
If we fail to adequately monitor our third-party service providers’ and business partners’ performance, including for compliance with our agreements and regulatory and legal requirements, we may have to incur additional costs to correct errors, our reputation could be harmed or we could be subject to litigation, claims, legal or regulatory proceedings, inquiries or investigations.
Additionally, if any of our product candidates receives marketing approval, the FDA could require us to adopt a REMS and other regulatory authorities could impose other specific obligations as a condition of approval to ensure that the benefits of our product candidates outweigh their risks, which could delay approval of our product candidates.
Additionally, if any of our product candidates receives marketing approval, the FDA could require us to adopt a Risk Evaluation and Mitigation Strategy (REMS) and other regulatory authorities could impose other specific obligations as a condition of approval to ensure that the benefits of our product candidates outweigh their risks, which could delay approval of our product candidates.
During the FDA review process, we will need to identify success criteria and endpoints such that the FDA will be able to determine the clinical efficacy and safety profile of our product candidates.
During the FDA review process, we will need to identify success criteria and endpoints such that the FDA will be able to subsequently evaluate the clinical efficacy and safety profile of our product candidates.
One customer accounted for approximately 95% of our total revenues for the year ended December 31, 2023. One customer accounted for approximately 90% of our total revenues for the year ended December 31, 2022. We expect future license and royalty revenue to be derived from a limited number of licensees and collaborators.
One customer accounted for approximately 98% of our total revenues for the year ended December 31, 2024. One customer accounted for approximately 95% of our total revenues for the year ended December 31, 2023. We expect future license and royalty revenue to be derived from a limited number of licensees and collaborators.
We have registered trademarks with the USPTO, including for the marks “AAVIATE,” AFFINITY,” “AFFINITY DUCHENNE,” “ALTITUDE,” “ATMOSPHERE,” “CAMPSIITE,” “NAV,” "NAVXCELL” and “REGENXBIO,” as well as for the REGENXBIO logos. Our trademarks or trade names may be challenged, infringed, circumvented or declared generic or determined to be infringing on other marks.
We have registered trademarks with the USPTO, including for the marks “AAVIATE,” “AFFINITY,” “AFFINITY BEYOND,” “AFFINITY DUCHENNE,” “ALTITUDE,” “ATMOSPHERE,” “CAMPSIITE,” “NAV,” “NAVXcell”, “NAVXpress” and “REGENXBIO,” as well as for the REGENXBIO logos. Our trademarks or trade names may be challenged, infringed, circumvented or declared generic or determined to be infringing on other marks.
Our internal computer systems and those of our current and any future collaborators and other contractors or consultants are vulnerable to damage from computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures.
Our information technology systems and those of our current and any future vendors, collaborators and other contractors or consultants are vulnerable to damage from computer viruses, unauthorized access, natural disasters, terrorism, war and telecommunication and electrical failures.
If such an incident were to occur in the future and cause a material interruption in our operations, it could result in a material disruption of our business or financial operations, including our licensing and development programs.
If such an incident were to occur in the future and cause a material interruption in our operations, it could result in a material disruption of our business or financial operations, including our licensing and development programs, and potentially subject us to liability.
We may enter into collaborations regarding one or more of our product candidates with other entities to utilize their marketing and distribution capabilities, such as our collaboration with AbbVie, but we may be unable to enter into such agreements on favorable terms, if at all.
We may enter into additional collaboration arrangements regarding one or more of our product candidates with other entities to utilize their marketing and distribution capabilities, such as our collaboration with AbbVie and Nippon Shinyaku, but we may be unable to enter into such agreements on favorable terms, if at all.
If our licensing agreements or collaborations do not result in the successful development and commercialization of products, or if one of our licensees or collaborators terminates its agreement with us, we may not receive any future milestone or royalty payments, as applicable, under the license agreement or collaboration.
If our licensing agreements or collaborations do not result in the successful development and commercialization of products, or if one of our licensees or collaborators terminates its agreement with us, we may not receive any future milestone or royalty payments.
Accordingly, in markets outside the United States, the reimbursement for our products may be reduced compared with the reimbursement in the United States and may be insufficient to generate commercially reasonable product revenues. 47 Table of Contents Moreover, increasing efforts by government and third-party payors in the United States and abroad to cap or reduce healthcare costs may cause such organizations to limit both coverage and the level of reimbursement for new products approved and, as a result, they may not cover or provide adequate payment for our product candidates.
Accordingly, in markets outside the United States, the reimbursement for our products may be reduced compared with the reimbursement in the United States and may be insufficient to generate commercially reasonable product revenues. 47 Moreover, increasing efforts by government and third-party payors in the United States and abroad to cap or reduce healthcare costs has led to increased pressure on the healthcare industry to reduce costs and may, in the future, cause such organizations to limit both coverage and the level of reimbursement for new products approved and, as a result, they may not cover or provide adequate payment for our product candidates.
Gene therapy is still a relatively new approach to disease treatment and additional adverse side 34 Table of Contents effects could develop. There also is the potential risk of delayed adverse events following exposure to gene therapy products due to persistent biologic activity of the genetic material or other components of products used to carry the genetic material.
Gene therapy is still a relatively new approach to disease treatment and additional adverse side effects could be identified. There also is the potential risk of delayed adverse events following exposure to gene therapy products due to persistent biologic activity of the genetic material or other components of products used to carry the genetic material.
Our internal computer systems, or those of our collaborators or other contractors or consultants, may fail or suffer security breaches, which could result in a material disruption of our business or financial operations, including our licensing and product development programs.
Our information technology systems, or those of our vendors, collaborators or other contractors or consultants, may fail or suffer security breaches, which could result in a material disruption of our business or financial operations, including our licensing and product development programs.
Our future capital requirements will depend on many factors, including: • the timing of enrollment, commencement and completion of our clinical trials; • the results of our clinical trials; • the results of our preclinical studies for our product candidates and any subsequent clinical trials; • the scope, progress, results and costs of drug discovery, laboratory testing, preclinical development and clinical trials for our product candidates; • the costs associated with building out additional laboratory and manufacturing capacity; • the costs, timing and outcome of regulatory review of our product candidates; • the costs of future product sales, medical affairs, marketing, manufacturing and distribution activities for any of our product candidates for which we receive marketing approval; • revenue, if any, received from commercial sales of our products, should any of our product candidates receive marketing approval; 38 Table of Contents • revenue received from commercial sales of Zolgensma and the timing and amount of Zolgensma royalties paid to HCR under our royalty purchase agreement; • revenue received from other commercial sales of our licensees’ and collaborators’ products, should any of their product candidates receive marketing approval, and other revenue received under our licensing agreements and collaborations; • the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • our current licensing agreements or collaborations remaining in effect, including the AbbVie Collaboration and License Agreement, and our ability to timely achieve any milestones set forth in such agreements or collaborations; • our ability to establish and maintain additional licensing agreements or collaborations on favorable terms, if at all; and • the extent to which we acquire or in-license other product candidates and technologies.
Our future capital requirements will depend on many factors, including: • the timing of enrollment, commencement and completion of our clinical trials; • the results of our clinical trials; • the results of our preclinical studies for our product candidates and any subsequent clinical trials; • the scope, progress, results and costs of drug discovery, laboratory testing, preclinical development and clinical trials for our product candidates; • the costs associated with building out additional laboratory and manufacturing capacity; • the costs, timing and outcome of regulatory review of our product candidates; • the impact of any government-imposed tariffs on cost of goods and services, particularly related to partnered product candidates; • the costs of future product sales, medical affairs, marketing, manufacturing and distribution activities for any of our product candidates for which we receive marketing approval; • revenue, if any, received from commercial sales of our products, should any of our product candidates receive marketing approval; • revenue received from commercial sales of Zolgensma and the timing and amount of Zolgensma royalties paid to HCR under our royalty purchase agreement; • revenue received from other commercial sales of our licensees’ and collaborators’ products, should any of their product candidates receive marketing approval, and other revenue received under our licensing agreements and collaborations; • the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • our current licensing agreements or collaborations remaining in effect, including the AbbVie Collaboration and License Agreement relating to ABBV-RGX-314 and the Nippon Shinyaku Collaboration and License Agreement relating to RGX-121 and RGX-111, and our ability to timely achieve any milestones set forth in such agreements or collaborations; 39 • our ability to establish and maintain additional licensing agreements or collaborations on favorable terms, if at all; and • the extent to which we acquire or in-license other product candidates and technologies.
The agreements under which we currently license intellectual property or technology from or to third parties, including the AbbVie Collaboration and License Agreement, are complex, and certain provisions in such agreements may be susceptible to multiple interpretations.
The agreements under which we currently license intellectual property or technology from or to third parties, including the AbbVie Collaboration and License Agreement, the Nippon Shinyaku Collaboration and License Agreement and our license agreements with GSK and Penn, are complex, and certain provisions in such agreements may be susceptible to multiple interpretations.
Risks Related to Our Business Operations • We may not be successful in our efforts to identify or discover additional product candidates. • We may not successfully execute or achieve the expected benefits of our strategic pipeline prioritization and restructuring plan or other cost-saving measures that we may take in the future. • Our future success depends on our ability to retain key employees, consultants and advisors and to attract qualified personnel. • We may face liability for our conduct and that of our employees, principal investigators, consultants or commercial partners. • We may face product liability lawsuits. • We could become subject to fines or penalties related to the failure to comply with environmental, health and safety laws. • We and our collaborators or other contractors or consultants may suffer cybersecurity breaches. • Our customers are concentrated and therefore the loss of a significant customer may harm our business.
Risks Related to Our Business Operations • We may not be successful in our efforts to identify or discover additional product candidates. • Our future success depends on our ability to retain key employees, consultants and advisors and to attract qualified personnel. • We may face liability for our conduct and that of our employees, principal investigators, consultants or commercial partners. • We may face product liability lawsuits. • We could become subject to fines or penalties related to the failure to comply with environmental, health and safety laws. • We and our collaborators or other contractors or consultants may suffer cybersecurity breaches. • Our customers are concentrated and therefore the loss of a significant customer may harm our business.
We have generated significant revenues from licensing our NAV Technology Platform, including sublicense fees, milestone payments and royalties on net sales of a licensed product, Zolgensma, and licensing our intellectual property to AbbVie pursuant to the AbbVie Collaboration and License Agreement.
We have generated significant revenues from licensing our NAV Technology Platform, including sublicense fees, milestone payments and royalties on net sales of a licensed product, Zolgensma, and licensing our intellectual property to AbbVie pursuant to the AbbVie Collaboration and License Agreement and may do so in the future pursuant to the Nippon Shinyaku Collaboration and License Agreement.
Additional risks and uncertainties not currently known to us or that we currently view to be immaterial may also materially adversely affect our business, financial condition or results of operations. In these circumstances, the market price of our common stock would likely decline and you could lose all or part of your investment.
Additional risks and uncertainties not currently known to us or that we currently view to be immaterial may also have a material adverse effect on our business, financial condition or results of operations. In these circumstances, the market price of our common stock would likely decline and you could lose all or part of your investment.
If the results of our planned clinical trials are inconclusive or if there are safety concerns or serious adverse events associated with our product candidates, we may: • be delayed in obtaining marketing approval for our product candidates, if at all; • obtain approval for indications or patient populations that are not as broad as intended or desired; • obtain approval with labeling that includes significant use or distribution restrictions or safety warnings; • be subject to changes in the way the product is administered; • be required to perform additional clinical trials to support approval or be subject to additional post-marketing testing or other requirements; • have regulatory authorities withdraw, vary or suspend their approval of the product or impose restrictions on its distribution in the form of a modified risk evaluation and mitigation; • be subject to the addition of labeling statements, such as warnings or contraindications; • be sued; or • experience damage to our reputation.
If the results of our planned clinical trials are inconclusive or if there are safety concerns or serious adverse events associated with our product candidates, we may: • receive a clinical hold for a particular product candidate, which, if not lifted, could require that we discontinue development of a product candidate; • be required to conduct additional studies or clinical trials with respect to a product candidate or for a potential indication, which may result in additional significant expense and delays in seeking regulatory approval; • be delayed in obtaining regulatory approval for our product candidates, if at all; • obtain approval for indications or patient populations that are not as broad as intended or desired; • obtain approval with labeling that includes significant use or distribution restrictions or safety warnings; • be subject to changes in the way the product is administered; • be required to perform additional clinical trials to support approval or be subject to additional post-marketing testing or other requirements; • have regulatory authorities withdraw, vary or suspend their approval of the product or impose restrictions on its distribution in the form of a modified risk evaluation and mitigation; • be subject to the addition of labeling statements, such as warnings or contraindications; • be sued; or • experience damage to our reputation.
We license certain intellectual property related to our NAV Technology Platform to our NAV Technology Licensees and collaborators. Our NAV Technology Licensees and collaborators have multiple preclinical studies and clinical trials in progress. However, only one gene therapy product based on our licensing program, Novartis AG’s Zolgensma, has been approved or commercialized.
Our NAV Technology Licensees and collaborators have multiple preclinical studies and clinical trials in progress. However, only one gene therapy product based on our licensing program, Novartis AG’s Zolgensma, has been approved or commercialized.
Risks Related to the Commercialization of Our Product Candidates • If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our product candidates, if approved, we may be unable to generate any product revenue. • We may not achieve our projected development goals in the timeframes we announce and expect. • Even if we receive regulatory approval, we still may not be able to successfully commercialize our product candidates. • Failure to obtain or maintain adequate insurance coverage and reimbursement for our products, if approved, could limit our ability to market those products and decrease our ability to generate product revenue. • Government price controls could restrict the amount that we are able to charge for any of our products, if approved.
Risks Related to the Commercialization of Our Product Candidates • If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell our product candidates, if approved, we may be unable to generate any product revenue. • We may not achieve our projected timelines that we announced. • Even if we receive regulatory approval, we still may not be able to successfully commercialize our product candidates. • Failure to obtain or maintain adequate insurance coverage and reimbursement for our products, if approved, or the imposition of price controls or other forms of pricing regulation could limit our ability to market those products and decrease our ability to generate product revenue.
As a result of these concerns, we may decide, or the FDA, the European Commission, the EMA or other regulatory authorities could order us, to halt, delay or amend preclinical development or clinical development of our product candidates or we may be unable to receive regulatory approval of our product candidates for any or all targeted indications.
If any such adverse events occur in our or third-party trials, our clinical trials could be suspended or terminated. 35 As a result of these concerns, we may decide, or the FDA, the European Commission, the EMA or other regulatory authorities could order us, to halt, delay or amend preclinical development or clinical development of our product candidates or we may be unable to receive regulatory approval of our product candidates for any or all targeted indications.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe output of this process is then integrated with our enterprise risk management (ERM) program. The ERM program is managed by our Chief Operating Officer (COO), with input from various representatives across our business operations, and is used to assess risks to our business based on their potential likelihood and magnitude of impact.
Biggest changeThe output of this process is then integrated with our enterprise risk management (ERM) program. The ERM program is managed cross-functionally, with input from various senior management representatives across our business operations, and is used to assess risks to our business based on their potential likelihood and magnitude of impact.
We require annual information security training to be completed by our employees, and we maintain a limited cybersecurity liability insurance policy. 62 Table of Contents Our Senior Vice President of Information Technology (SVP, IT) is responsible for the establishment and maintenance of our cybersecurity program, as well as the assessment and management of cybersecurity risks.
We require annual information security training to be completed by our employees, and we maintain a limited cybersecurity liability insurance policy. 62 Our Senior Vice President of Information Technology (SVP, IT) is responsible for the establishment and maintenance of our cybersecurity program, as well as the assessment and management of cybersecurity risks.
In addition to material risks identified by the ERM process, our information technology management provides periodic reporting, at least semi-annually, on our cybersecurity risk profile and risk mitigation strategies to the Audit Committee. This reporting is also made available to the full Board of Directors.
In addition to material risks identified through the ERM process, our information technology management provides periodic reporting, at least semi-annually, on our cybersecurity risk profile and risk mitigation strategies to the Audit Committee. This reporting is also made available to the full Board of Directors.
The Audit Committee of our Board of Directors oversees our ERM program and is apprised of material risks arising from cybersecurity threats impacting our business. The COO provides quarterly reporting on our material enterprise risks to the Audit Committee.
The Audit Committee of our Board of Directors oversees our ERM program regarding material risks arising from cybersecurity threats impacting our business. Management provides quarterly reporting on our material enterprise risks to the Audit Committee.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe also occupy approximately 78,000 square feet of office, laboratory and warehousing space at other locations in Rockville, Maryland and Washington, D.C., and approximately 10,000 square feet of office space in New York, New York, under leases that expire at various dates through 2029, some of which are renewable for additional years.
Biggest changeWe also occupy approximately 78,000 square feet of office, laboratory and warehousing space at other locations in Rockville, Maryland and Washington, D.C., under leases that expire at various dates through 2029, some of which are renewable for additional years. We believe that our facilities are adequate to meet our operating needs for the foreseeable future.
Removed
We believe that our facilities are adequate to meet our operating needs for the foreseeable future.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWe do not believe that we are currently party to any pending legal actions that could reasonably be expected to have a material adverse effect on our business, financial condition, results of operations or cash flows. ITEM 4. MINE SAF ETY DISCLOSURES Not applicable. 63 Table of Contents PART II
Biggest changeWe do not believe that we are currently party to any pending legal actions that could reasonably be expected to have a material adverse effect on our business, financial condition, results of operations or cash flows. ITEM 4. MINE SAF ETY DISCLOSURES Not applicable. 63 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following performance graph and related information shall not be deemed "soliciting material" or to be "filed" with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, each as amended, except to the extent that we specifically incorporate it by reference into such filing. $100 investment in stock or index December 31, 2018 December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 REGENXBIO Inc. $ 100 $ 98 $ 108 $ 78 $ 54 $ 43 Nasdaq Composite $ 100 $ 137 $ 198 $ 242 $ 163 $ 236 Nasdaq Biotechnology $ 100 $ 125 $ 158 $ 158 $ 142 $ 149 64 Table of Contents Holders As of February 22, 2024, there were six holders of record of our common stock.
Biggest changeThe following performance graph and related information shall not be deemed "soliciting material" or to be "filed" with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, each as amended, except to the extent that we specifically incorporate it by reference into such filing. $100 investment in stock or index December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 REGENXBIO Inc. $ 100 $ 111 $ 80 $ 55 $ 44 $ 19 Nasdaq Composite $ 100 $ 145 $ 177 $ 119 $ 173 $ 224 Nasdaq Biotechnology $ 100 $ 126 $ 126 $ 114 $ 119 $ 118 64 Holders As of March 7, 2025, there were five holders of record of our common stock.
The figures below assume an investment of $100 in our common stock, the Nasdaq Composite Index and the Nasdaq Biotechnology Index at the closing price on December 31, 2018 and assumes the reinvestment of dividends, if any. The comparisons shown in the graph below are based upon historical data.
The figures below assume an investment of $100 in our common stock, the Nasdaq Composite Index and the Nasdaq Biotechnology Index at the closing price on December 31, 2019 and assumes the reinvestment of dividends, if any. The comparisons shown in the graph below are based upon historical data.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is traded on The Nasdaq Global Select Market under the symbol “RGNX.” Stock Performance Graph The graph set forth below compares the cumulative total stockholder return on our common stock between December 31, 2018 and December 31, 2023, with the cumulative total return of (a) the Nasdaq Composite Index and (b) the Nasdaq Biotechnology Index, over the same period.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is traded on The Nasdaq Global Select Market under the symbol “RGNX.” Stock Performance Graph The graph set forth below compares the cumulative total stockholder return on our common stock between December 31, 2019 and December 31, 2024, with the cumulative total return of (a) the Nasdaq Composite Index and (b) the Nasdaq Biotechnology Index, over the same period.
We do not plan to pay dividends in the foreseeable future. ITEM 6. [RESERVED] 65 Table of Contents
We do not plan to pay dividends in the foreseeable future. ITEM 6. [RESERVED] 65

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe decrease was primarily attributable to the following: • a decrease of $11.6 million in manufacturing expenses and other costs of clinical supply for our lead product candidates, largely driven by ABBV-RGX-314 and RGX-202 clinical supply; • a decrease of $8.4 million in costs associated with clinical trial and regulatory activities, largely driven by an increase in net development cost reimbursement from AbbVie under our ABBV-RGX-314 collaboration, and partially offset by increases in clinical trial expenses for RGX-121 and RGX-202; and • a decrease of $2.2 million in costs associated with preclinical activities and other early stage research and development.
Biggest changeThe decrease was primarily attributable to the following: • a decrease of $10.5 million in personnel-related costs for research and development personnel, including a $2.6 million decrease in stock-based compensation expense, primarily driven by the reduction in workforce associated with our corporate restructuring in the fourth quarter of 2023; • a decrease of $10.3 million in manufacturing expenses and other costs of clinical supply for our lead product candidates, largely driven by ABBV-RGX-314 and RGX-121 clinical supply costs; • a decrease of $6.2 million in preclinical activities and other early-stage research and development; and • a decrease of $6.1 million in costs for laboratories and facilities used by research and development personnel, including a $1.1 million decrease in depreciation expense allocated to research and development functions, primarily driven by a decrease in laboratory supplies and consumables.
Investment Income Investment income consists of interest income earned and gains and losses realized from our cash equivalents, marketable securities and non-marketable equity securities. Cash equivalents are comprised of money market mutual funds and highly liquid debt securities with original maturities of 90 days or less at acquisition. Marketable securities are comprised of available-for-sale debt securities.
Investment Income Investment income consists of interest income earned and gains and losses realized from our cash and cash equivalents, marketable securities and non-marketable equity securities. Cash equivalents are comprised of money market mutual funds and highly liquid debt securities with original maturities of 90 days or less at acquisition. Marketable securities are comprised of available-for-sale debt securities.
License agreements generally have a term at least equal to the life of the underlying patents, but are terminable at the option of the licensee.
License agreements generally have a term at least equal to the life of the underlying patents, but are terminable at the option of the licensee.
The following five steps are performed to determine the appropriate revenue recognition for arrangements within the scope of ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies the performance obligations.
The following five steps are performed to determine the appropriate revenue recognition for arrangements within the scope 71 of ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies the performance obligations.
The fair value of our common stock, as used as an input to determine the fair value of our stock option awards, is based on the closing price of our common stock on the date of the grant.
The fair value of our common stock, as used as an input to determine the fair value of our stock option awards, is based on the closing price of our common stock on the date of the 74 grant.
Consideration payable to us under our license agreements may include: (i) up-front and annual fees, (ii) milestone payments based on the achievement of certain development and sales-based milestones, (iii) sublicense fees, (iv) royalties on sales of licensed products and (v) other consideration payable upon optional goods and services purchased by licensees.
Consideration payable to us under our license agreements may include: (i) up-front and annual fees, (ii) milestone payments based on the achievement of certain development and sales-based milestones, (iii) sublicense fees, (iv) royalties on sales of licensed products, (v) fees for services related to the development of licensed products and (vi) other consideration payable upon optional goods and services purchased by licensees.
Private Placement On July 7, 2023, we sold 257,466 shares of our common stock in a private placement transaction for which we received aggregate net proceeds of $4.9 million, net of offering expenses.
Private Placement In July 2023, we sold 257,466 shares of our common stock in a private placement transaction for which we received aggregate net proceeds of $4.9 million, net of offering expenses.
As of December 31, 2023, our NAV Technology Platform was being applied in one commercial product (Zolgensma ® ), and the preclinical and clinical development of a number of other licensed products.
As of December 31, 2024, our NAV Technology Platform was being applied in one commercial product, Zolgensma ® , and the preclinical and clinical development of a number of other licensed products.
The changes in operating assets and liabilities include an increase in other current assets of $10.5 million, which was driven primarily by an increase in net cost reimbursement due from AbbVie under our ABBV-RGX-314 collaboration. Other changes in operating assets and liabilities occurred in the normal course of business as a result of changes in operating working capital.
The changes in operating assets and liabilities include an increase in other current assets of $10.5 million, which was driven primarily by an increase in net cost reimbursement due from AbbVie under our ABBV-RGX-314 collaboration. Other changes in operating working capital occurred in the normal course of business.
Actual results may differ materially from these estimates under different assumptions or conditions. Our significant accounting policies are fully described in Note 2 to our audited consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K.
Actual results may differ materially from these estimates under different assumptions or conditions. Our significant accounting policies are fully described in Note 2, “Summary of Significant Accounting Policies” to our audited consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K.
We license our NAV Technology Platform and other intellectual property rights to other biotechnology and pharmaceutical companies, including collaborators for the joint development and commercialization of our product candidates. The terms of the 67 Table of Contents licenses vary, and licenses may be exclusive or non-exclusive and may be sublicensable by the licensee.
We license our NAV Technology Platform and other intellectual property rights to other biotechnology and pharmaceutical companies, including collaborators for the joint development and commercialization of our product candidates. The terms of the licenses vary, and licenses may be exclusive or non-exclusive and may be sublicensable by the licensee.
We do not expect to achieve such revenues, and expect to continue to incur losses, for at least the next several years. We expect to continue to incur 78 Table of Contents significant research and development and general and administrative expenses for the foreseeable future as we continue the development of, and seek regulatory approval for, our product candidates.
We do not expect to achieve such revenues, and expect to continue to incur losses, for at least the next several years. We expect to continue to incur significant research and development and general and administrative expenses for the foreseeable future as we continue the development of, and seek regulatory approval for, our product candidates.
The issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our common stock to decline. Adequate additional financing may not be available to us on acceptable terms, or at all.
The issuance of additional securities, whether equity or debt, by us, including through our at-the-market program, or the possibility of such issuance, may cause the market price of our common stock to decline. Adequate additional financing may not be available to us on acceptable terms, or at all.
Consideration from licensees under our license agreements may include: (i) up-front and annual fees, (ii) milestone payments based on the achievement of certain development and sales-based milestones, (iii) sublicense fees, (iv) royalties on sales of licensed products and (v) other consideration payable upon optional goods and services purchased by licensees.
Consideration from licensees under our license agreements may include: (i) up-front and annual fees, (ii) milestone payments based on the achievement of certain development and sales-based milestones, (iii) sublicense fees, (iv) royalties on sales of licensed products, (v) fees for services related to the development of licensed products and (vi) other consideration payable upon optional goods and services purchased by licensees.
We then recognize as revenue the amount of the transaction price that is allocated to respective performance obligations when (or as) the respective performance obligations are satisfied. 70 Table of Contents We evaluate our contracts with customers for the presence of significant financing components.
We then recognize as revenue the amount of the transaction price that is allocated to respective performance obligations when (or as) the respective performance obligations are satisfied. We evaluate our contracts with customers for the presence of significant financing components.
For a full discussion and analysis of financial condition and results of operations for the year ended December 31, 2022, including a year-over-year comparison to the year ended December 31, 2021, please read the “Management's Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the year ended December 31, 2022, which we filed with the SEC on February 28, 2023.
For a full discussion and analysis of financial condition and results of operations for the year ended December 31, 2023, including a year-over-year comparison to the year ended December 31, 2022, please read the “Management's Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the year ended December 31, 2023, which we filed with the SEC on February 27, 2024.
Due to the contingent nature of the payments, the amounts and timing of payments to licensors under our in-license agreements are uncertain and may fluctuate significantly from period to period. In March 2022, we entered into a letter agreement with Penn to buy out our obligation to pay sublicense fees under the Penn License.
Due to the contingent nature of the payments, the amounts and timing of payments to licensors under our in-license agreements are uncertain and may fluctuate significantly from period to period. 79 In March 2022, we entered into a letter agreement (the Penn Letter Agreement) with The Trustees of the University of Pennsylvania (Penn) to buy out our obligation to pay sublicense fees under our license agreement with Penn (the Penn License).
We intend to use proceeds obtained from the sale of shares under the ATM Program, if any, for general corporate purposes. As of December 31, 2023, no shares of common stock had been sold under the ATM Program.
As of December 31, 2024, no shares of common stock had been sold under the Leerink ATM Program. We intend to use proceeds obtained from the sale of shares under the Leerink ATM Program, if any, for general corporate purposes.
If it is determined that the license is not distinct from the research and development services, the license is combined with the research and development services into a single performance obligation. 71 Table of Contents We evaluate the transaction price of our license agreements at the inception of each agreement and at each reporting date.
If it is 72 determined that the license is not distinct from the research and development services, the license is combined with the research and development services into a single performance obligation. We evaluate the transaction price of our license agreements at the inception of each agreement and at each reporting date.
Future Funding Requirements We have incurred cumulative losses since our inception and had an accumulated deficit of $705.0 million as of December 31, 2023. Our transition to recurring profitability is dependent upon achieving a level of revenues adequate to support our cost structure, which depends heavily on the successful development, approval and commercialization of our product candidates.
Future Funding Requirements We have incurred cumulative losses since our inception and had an accumulated deficit of $932.1 million as of December 31, 2024. Our transition to recurring profitability is dependent upon achieving a level of revenues adequate to support our cost structure, which depends heavily on the successful development, approval and commercialization of our product candidates.
Cash Flows from Financing Activities For the year ended December 31, 2023, our net cash used in financing activities primarily consisted of $42.3 million of Zolgensma royalties paid to HCR, net of imputed interest, under our royalty purchase agreement.
For the year ended December 31, 2023, our net cash used in financing activities primarily consisted of $42.3 million of Zolgensma royalties paid, net of imputed interest, under our royalty purchase agreement with HCR.
We estimate expected stock price volatility based on the historical volatility of our common stock over a period of time 73 Table of Contents commensurate with the expected term of our stock option awards.
We estimate expected stock price volatility based on the historical volatility of our common stock over a period of time commensurate with the expected term of our stock option awards.
The AFFINITY BEYOND ™ trial, an observational screening study, is also active and recruiting patients. The primary objective is to evaluate the prevalence of AAV8 antibodies in patients with Duchenne up to 12 years of age.
We are also recruiting patients in the AFFINITY BEYOND ® trial, an observational screening study. The primary objective is to evaluate the prevalence of AAV8 antibodies in patients with Duchenne up to 12 years of age.
Through a single administration, gene therapy could potentially alter the course of disease significantly and deliver improved patient outcomes with long-lasting effects. Overview of Product Candidates We have developed a broad pipeline of gene therapy programs using our proprietary adeno-associated virus (AAV) gene therapy delivery platform (NAV Technology Platform) to address genetic diseases.
Through a single administration, gene therapy could potentially alter the course of disease significantly and deliver improved patient outcomes with long-lasting effects. Overview of Product Candidates We have developed a broad pipeline of gene therapy programs using our proprietary adeno-associated virus (AAV) gene therapy delivery platform (NAV Technology Platform) as a one-time treatment to address an array of diseases.
Our federal NOL carryforwards and a portion of our state NOL carryforwards as of December 31, 2023 may be carried forward indefinitely. The remaining portion of our state NOL carryforwards and our federal and state credit carryforwards as of December 31, 2023 expire at various dates between 2029 and 2043.
Our federal NOL carryforwards and a portion of our state NOL carryforwards as of December 31, 2024 may be carried forward indefinitely. The remaining portion of our state NOL carryforwards and our federal and state credit carryforwards as of December 31, 2024 expire at various dates between 2029 and 2044.
Our future capital requirements will depend on many factors, including: • the timing of enrollment, commencement and completion of our clinical trials; • the results of our clinical trials; • the results of our preclinical studies for our product candidates and any subsequent clinical trials; • the scope, progress, results and costs of drug discovery, laboratory testing, preclinical development and clinical trials for our product candidates; • the costs associated with building out additional laboratory and manufacturing capacity; • the costs, timing and outcome of regulatory review of our product candidates; • the costs of future product sales, medical affairs, marketing, manufacturing and distribution activities for any of our product candidates for which we receive marketing approval; • revenue, if any, received from commercial sales of our products, should any of our product candidates receive marketing approval; • revenue received from commercial sales of Zolgensma and the timing and amount of Zolgensma royalties paid to HCR under our royalty purchase agreement; • revenue received from other commercial sales of our licensees’ and collaborators’ products, should any of their product candidates receive marketing approval, and other revenue received under our licensing agreements and collaborations; • the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • our current licensing agreements or collaborations remaining in effect, including the AbbVie Collaboration Agreement, and our ability to timely achieve any milestones set forth in such agreements or collaborations; • our ability to establish and maintain additional licensing agreements or collaborations on favorable terms, if at all; and • the extent to which we acquire or in-license other product candidates and technologies.
Our future capital requirements will depend on many factors, including: • the timing of enrollment, commencement and completion of our clinical trials; • the results of our clinical trials; • the results of our preclinical studies for our product candidates and any subsequent clinical trials; • the scope, progress, results and costs of drug discovery, laboratory testing, preclinical development and clinical trials for our product candidates; • the costs associated with building out additional laboratory and manufacturing capacity; • the costs, timing and outcome of regulatory review of our product candidates; • the impact of any government-imposed tariffs on cost of goods and services, particularly related to partnered product candidates; • the costs of future product sales, medical affairs, marketing, manufacturing and distribution activities for any of our product candidates for which we receive marketing approval; • revenue, if any, received from commercial sales of our products, should any of our product candidates receive marketing approval; • revenue received from commercial sales of Zolgensma and the timing and amount of Zolgensma royalties paid to HCR under our royalty purchase agreement; • revenue received from other commercial sales of our licensees’ and collaborators’ products, should any of their product candidates receive marketing approval, and other revenue received under our licensing agreements and collaborations; 80 • the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims; • our current licensing agreements or collaborations remaining in effect, including the AbbVie Collaboration Agreement relating to ABBV-RGX-314 and the Nippon Shinyaku Collaboration Agreement relating to RGX-121 and RGX-111, and our ability to timely achieve any milestones set forth in such agreements or collaborations; • our ability to establish and maintain additional licensing agreements or collaborations on favorable terms, if at all; and • the extent to which we acquire or in-license other product candidates and technologies.
Off-Balance Sheet Arrangements We did not have any off-balance sheet arrangements during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC. 79 Table of Contents
Off-Balance Sheet Arrangements We did not have any off-balance sheet arrangements during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the rules and regulations of the SEC. 81
Our programs and product candidates are described below: • ABBV-RGX-314: We are developing ABBV-RGX-314 in collaboration with AbbVie as a potential one-time treatment for wet age-related macular degeneration (wet AMD), diabetic retinopathy (DR) and other additional chronic retinal conditions which cause total or partial vision loss.
Our lead programs and product candidates are described below: • ABBV-RGX-314: We are developing ABBV-RGX-314 (surabgene lomparvovec) in collaboration with AbbVie as a potential one-time treatment for chronic retinal conditions that cause total or partial vision loss, including wet age-related macular degeneration (wet AMD) and diabetic retinopathy (DR).
Information collected in this study may be used to identify potential participants for the AFFINITY DUCHENNE trial and potential future trials of RGX-202. • RGX-121: We are developing RGX-121 as an investigational one-time AAV therapeutic for the treatment of Mucopolysaccharidosis Type II (MPS II), also known as Hunter syndrome, using the NAV AAV9 vector to deliver the gene that encodes the iduronate-2-sulfatase enzyme.
Information collected in this study may be used to identify potential participants for the AFFINITY DUCHENNE trial and potential future trials of RGX-202. • RGX-121: We are developing RGX-121 (clemidsogene lanparvovec) in collaboration with Nippon Shinyaku in the United States and certain countries in Asia as an investigational one-time AAV therapeutic for the treatment of Mucopolysaccharidosis Type II (MPS II), also known as Hunter syndrome, using the NAV AAV9 vector to deliver the gene that encodes the iduronate-2-sulfatase enzyme.
In general, we do not allocate personnel and other internal costs, such as facilities and other overhead costs, to specific product candidates or development programs.
As a result, we generally do not allocate personnel and other internal costs, such as facilities and other overhead costs, to specific product candidates or development programs.
The transaction price includes the fixed consideration payable to us during the contract term, as well as any variable consideration to the extent that it is probable that a significant reversal of revenue will not occur in the future. Fixed consideration under the license agreements includes up-front and annual fees payable during the contract term.
The transaction price includes the fixed consideration payable to us during the contract term, as well as any variable consideration to the extent that it is probable that a significant reversal of revenue will not occur in the future.
Cash Flows from Investing Activities For the year ended December 31, 2023, our net cash provided by investing activities consisted of $285.5 million in maturities of marketable debt securities and $2.0 million in proceeds received from uniQure upon the achievement of milestones associated with their acquisition of Corlieve, offset by $86.6 million to purchase marketable debt securities and $10.0 million to purchase property and equipment. 77 Table of Contents For the year ended December 31, 2022, our net cash used in investing activities primarily consisted of $184.9 million to purchase marketable debt securities and $30.7 million to purchase property and equipment, partially offset by $203.1 million in maturities of marketable debt securities.
For the year ended December 31, 2023, our net cash provided by investing activities consisted of $285.5 million in maturities of marketable debt securities and $2.0 million in proceeds received from uniQure upon the achievement of milestones associated with their acquisition of Corlieve, offset by $86.6 million used to purchase marketable debt securities and $10.0 million used to purchase property and equipment.
Operating Expenses Our operating expenses consist primarily of cost of revenues, research and development expenses and general and administrative expenses. Personnel costs including salaries, wages, benefits, bonuses and stock-based compensation expense, comprise a significant component of research and development and general and administrative expenses.
Personnel costs including salaries, wages, benefits, bonuses and stock-based compensation expense, comprise a significant component of research and development and general and administrative expenses.
If we fail to complete the development of our product candidates in a timely manner or obtain regulatory approval and adequate labeling, our ability to generate future revenues will be materially compromised.
We have not generated any revenues from commercial sales of our own products. If we fail to complete the development of our product candidates in a timely manner or obtain regulatory approval and adequate labeling, our ability to generate future revenues will be materially compromised.
Additionally, general and administrative expenses include facility-related and overhead costs not otherwise allocated to research and development expense, professional fees for accounting, legal, commercial and other advisory services, expenses associated with obtaining and maintaining patents, insurance costs, costs of our information systems and other 69 Table of Contents general corporate activities.
Additionally, general and administrative expenses include costs associated with accounting, legal, commercial and other corporate advisory services, obtaining and maintaining patents, insurance, information systems and other general corporate activities, as well as facility-related costs and other corporate overhead costs not otherwise allocated to research and development expense.
Liquidity and Capital Resources Sources of Liquidity As of December 31, 2023, we had cash, cash equivalents and marketable securities of $314.1 million, which were primarily derived from the sale of our common stock and license fees received under the AbbVie Collaboration Agreement.
Liquidity and Capital Resources Sources of Liquidity As of December 31, 2024, we had cash, cash equivalents and marketable securities of $244.9 million, which were primarily derived from the sale of our common stock and pre-funded warrants and license fees received under the AbbVie Collaboration Agreement, as described below.
Research and Development Expense Our research and development expenses consist primarily of: • Salaries, wages and personnel-related costs, including benefits, travel and stock-based compensation, for our scientific personnel and others performing research and development activities; 68 Table of Contents • costs related to executing preclinical studies and clinical trials; • costs related to acquiring, developing and manufacturing materials for preclinical studies and clinical trials; • fees paid to consultants and other third parties who support our product candidate development; • other costs in seeking regulatory approval of our product candidates; and • direct costs and allocated costs related to laboratories and facilities, depreciation expense, information technology and other overhead.
Future costs of revenues are uncertain due to the nature of our license agreements and significant fluctuations in cost of revenues may occur from period to period. 69 Research and Development Expense Our research and development expenses consist primarily of: • salaries, wages and personnel-related costs, including benefits, travel and stock-based compensation, for our scientific personnel and others performing research and development activities; • costs related to executing preclinical studies and clinical trials; • costs related to acquiring, developing and manufacturing materials for preclinical studies and clinical trials; • fees paid to consultants and other third parties who support our product candidate development; • other costs in seeking regulatory approval of our product candidates; and • direct costs and allocated costs related to laboratories and facilities, depreciation expense, information technology and other overhead.
AFFINITY DUCHENNE ™ is a multicenter, open-label dose evaluation and dose expansion clinical trial to evaluate the safety, tolerability and clinical efficacy of a one-time intravenous (IV) dose of RGX-202 in patients with Duchenne.
AFFINITY DUCHENNE ® is a multicenter, open-label Phase I/II/III trial to evaluate the safety, tolerability and clinical efficacy of a one-time intravenous dose of RGX-202 in patients with Duchenne aged one and older.
The AAVIATE ® trial is a multi-center, open label, randomized, controlled, dose-escalation Phase II trial to evaluate the efficacy, safety and tolerability of suprachoroidal delivery of ABBV-RGX-314 for the treatment of wet AMD.
Topline data from these trials are expected to be shared in 2026. Suprachoroidal Delivery The AAVIATE ® trial is a multi-center, open label, randomized, controlled, dose-escalation Phase II trial to evaluate the efficacy, safety and tolerability of suprachoroidal delivery of ABBV-RGX-314 for the treatment of wet AMD.
For additional information regarding our collaborative arrangements, including our ABBV-RGX-314 collaboration with AbbVie which became effective in November 2021, please refer to Note 10, “License and Collaboration Agreements” to the accompanying audited consolidated financial statements. Accrued Research and Development Expenses We estimate our accrued research and development expenses as of each balance sheet date.
For additional information regarding our collaborative arrangements, including our collaborations with AbbVie and Nippon Shinyaku, refer to Note 10, “License and Collaboration Agreements” to the accompanying audited consolidated financial statements. Accrued Research and Development Expenses We estimate our accrued research and development expenses as of each balance sheet date.
Licensing the NAV Technology Platform allows us to maintain our internal product development focus on our core disease indications and therapeutic areas while still expanding the NAV gene therapy pipeline, developing a greater breadth of treatments for patients, providing additional technological and potential clinical proof-of-concept for our NAV Technology Platform and creating potential additional revenue.
Licensing the NAV Technology Platform allows us to maintain our internal product development focus on our core disease indications and therapeutic areas while still expanding the NAV gene therapy pipeline, developing a greater breadth of treatments for patients, providing additional technological and potential clinical proof-of-concept for our NAV Technology Platform and creating potential additional revenue opportunities. 68 Financial Overview Revenues Our revenues to date consist primarily of license and royalty revenue resulting from the licensing of our NAV Technology Platform and other intellectual property rights.
As of December 31, 2023, we had federal net operating loss (NOL) carryforwards of $212.7 million, U.S. state NOL carryforwards of $259.1 million and federal and state research and development tax credit carryforwards of $77.3 million (net of unrecognized tax benefits of $0.1 million) which may be available to offset future income tax liabilities.
As of December 31, 2024, we had federal net operating loss (NOL) carryforwards of $373.6 million, U.S. state NOL carryforwards of $408.9 million and federal and state research and development tax credit carryforwards of $87.2 million (net of unrecognized tax benefits of $0.1 million) which may be available to offset future income tax liabilities.
As of December 31, 2023, the total amount of future Zolgensma royalties to be paid to HCR under the agreement was $102.0 million if paid by November 7, 2024, or $142.0 million if paid after that date. We have no obligation to repay any amounts to HCR if total future Zolgensma royalty payments are not sufficient to repay these amounts.
As of December 31, 2024, the total amount of future Zolgensma royalties to be paid to HCR under the agreement was $95.6 million. We have no obligation to repay any amounts to HCR if total future Zolgensma royalty payments are not sufficient to repay these amounts.
We expect that our cash, cash equivalents and marketable securities as of December 31, 2023, will enable us to fund our operating expenses and capital expenditure requirements, and are sufficient to meet our financial commitments and obligations, for at least the next 12 months from the date of this report, based on our current business plan.
We expect that our cash, cash equivalents and marketable securities as of December 31, 2024, along with the up-front payment of $110.0 million expected to be received under the Nippon Shinyaku Collaboration Agreement, will enable us to fund our operating expenses and capital expenditure requirements, and are sufficient to meet our financial commitments and obligations, for at least the next 12 months from the date of this report, based on our current business plan.
Enrollment continues to be on track in the ATMOSPHERE ® and ASCENT™ pivotal trials as well as the Fellow Eye treatment study for the treatment of patients with wet AMD using subretinal delivery. These trials are expected to support global regulatory submissions with the U.S.
Wet AMD Subretinal Delivery Enrollment continues to be on track in the ATMOSPHERE ® and ASCENT ™ pivotal trials for the treatment of patients with wet AMD using subretinal delivery. These trials are expected to support global regulatory submissions with the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA).
The termination of our licenses by licensees may materially impact the amount of revenue we recognize in future periods. Please refer to Note 2 to our audited consolidated financial statements appearing elsewhere in this Annual Report on Form 10-K for a description of segment and geographical information regarding our revenues.
The termination of our licenses by licensees may materially impact the amount of revenue we recognize in future periods. Please refer to Note 17, “Segment and Geographical Information” to the accompanying audited consolidated financial statements for a description of segment and geographical information regarding our revenues.
License and royalty revenue decreased by $22.5 million, from $112.7 million for the year ended December 31, 2022 to $90.2 million for the year ended December 31, 2023. The decrease was primarily attributable to Zolgensma royalty revenues, which decreased by $16.6 million, from $101.9 million in 2022 to $85.3 million in 2023.
License and royalty revenue decreased by $6.9 million, from $90.2 million for the year ended December 31, 2023 to $83.3 million for the year ended December 31, 2024. The decrease was primarily attributable to non-recurring development milestone revenue recognized in 2023, and Zolgensma royalty revenues, which decreased from $85.3 million in 2023 to $81.5 million in 2024.
For the year ended December 31, 2022, our net cash used in operating activities of $207.5 million consisted of a net loss of $280.3 million, offset by adjustments for non-cash items of $58.9 million and favorable changes in operating assets and liabilities of $14.0 million.
For the year ended December 31, 2024, our net cash used in operating activities of $173.1 million consisted of a net loss of $227.1 million, offset by adjustments for non-cash items of $48.4 million and favorable changes in operating assets and liabilities of $5.5 million.
At-the-Market Offering Program On September 1, 2023, we entered into an ATM Equity Offering SM Sales Agreement with BofA Securities, Inc. (BofA) pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $150.0 million from time to time through BofA, acting as our sales agent (the ATM Program).
In December 2024, we entered into a Sales Agreement with Leerink Partners LLC (Leerink) pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $150.0 million from time to time through Leerink, acting as our sales agent (the Leerink ATM Program).
Under the terms of our royalty purchase agreement with HCR, our future Zolgensma royalties, less amounts payable by us to certain licensors, will be payable to HCR up to a specified capped amount.
Please refer to Note 6, “Leases” to the accompanying consolidated financial statements for further information regarding our lease commitments. Under the terms of our royalty purchase agreement with HCR, our future Zolgensma royalties, less amounts payable by us to certain licensors, will be payable to HCR up to a specified capped amount.
Variable consideration under the license agreements includes development and sales-based milestone payments, sublicense fees and royalties on sales of licensed products. Consideration contingent upon the exercise of options by a licensee is excluded from the transaction price and not accounted for as part of the license agreement until the option is exercised.
Consideration contingent upon the exercise of options by a licensee is excluded from the transaction price and not accounted for as part of the license agreement until the option is exercised.
Platform and new technologies reported in the table above include direct costs not identifiable with a specific lead product candidate, including costs associated with our research and development platform used across programs, process development, manufacturing analytics and early research and development for prospective product candidates and new technologies.
Platform and early research reported in the table above includes direct costs not identifiable with a specific lead product candidate, including costs associated with our research and development platform used across programs, process and analytical development, early research and development for prospective product candidates and new technologies, and other costs in support of research and development activities. 70 Direct expenses related to the development of product candidates for which we have discontinued internal development are included in other product candidates in the table above.
For additional information regarding the corporate restructuring, please refer to Note 14, “Restructuring” to the accompanying audited consolidated financial statements. Overview of Our NAV Technology Platform In addition to our internal product development efforts, we also selectively license the NAV Technology Platform to other leading biotechnology and pharmaceutical companies, which we refer to as NAV Technology Licensees.
Overview of Our NAV Technology Platform In addition to our internal product development efforts, we also selectively license the NAV Technology Platform and other intellectual property rights to other leading biotechnology and pharmaceutical companies, which we refer to as NAV Technology Licensees.
Accordingly, we provided a full valuation allowance for our net deferred tax assets as of December 31, 2023 and 2022. 74 Table of Contents Results of Operations Our consolidated results of operations were as follows (in thousands): Years Ended December 31, Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 Revenues License and royalty revenue $ 90,242 $ 112,724 $ 470,347 $ (22,482 ) $ (357,623 ) Total revenues 90,242 112,724 470,347 (22,482 ) (357,623 ) Operating Expenses Cost of revenues 37,213 54,545 51,833 (17,332 ) 2,712 Research and development 232,266 242,453 181,437 (10,187 ) 61,016 General and administrative 88,494 85,281 79,333 3,213 5,948 Credit losses (recoveries) — — (2,569 ) — 2,569 Other operating expenses (income) 397 (6,679 ) 333 7,076 (7,012 ) Total operating expenses 358,370 375,600 310,367 (17,230 ) 65,233 Income (loss) from operations (268,128 ) (262,876 ) 159,980 (5,252 ) (422,856 ) Other Income (Expense) Interest income from licensing 25 342 719 (317 ) (377 ) Investment income 11,319 5,383 6,825 5,936 (1,442 ) Interest expense (6,862 ) (23,254 ) (26,277 ) 16,392 3,023 Total other income (expense) 4,482 (17,529 ) (18,733 ) 22,011 1,204 Income (loss) before income taxes (263,646 ) (280,405 ) 141,247 16,759 (421,652 ) Income Tax Benefit (Expense) 152 84 (13,407 ) 68 13,491 Net income (loss) $ (263,494 ) $ (280,321 ) $ 127,840 $ 16,827 $ (408,161 ) Comparison of the Years Ended December 31, 2023 and 2022 License and Royalty Revenue.
Accordingly, we provided a full valuation allowance for our net deferred tax assets as of December 31, 2024 and 2023. 75 Results of Operations Our consolidated results of operations were as follows (in thousands): Years Ended December 31, Change 2024 2023 2022 2024 vs. 2023 2023 vs. 2022 Revenues License and royalty revenue $ 83,328 $ 90,242 $ 112,724 $ (6,914 ) $ (22,482 ) Total revenues 83,328 90,242 112,724 (6,914 ) (22,482 ) Operating Expenses Cost of revenues 33,567 37,213 54,545 (3,646 ) (17,332 ) Research and development 208,522 232,266 242,453 (23,744 ) (10,187 ) General and administrative 76,619 88,494 85,281 (11,875 ) 3,213 Credit losses (recoveries) (5,000 ) — — (5,000 ) — Impairment of long-lived assets 2,101 — — 2,101 — Other operating expenses (income) 865 397 (6,679 ) 468 7,076 Total operating expenses 316,674 358,370 375,600 (41,696 ) (17,230 ) Loss from operations (233,346 ) (268,128 ) (262,876 ) 34,782 (5,252 ) Other Income (Expense) Interest income from licensing 174 25 342 149 (317 ) Investment income 18,729 11,319 5,383 7,410 5,936 Interest expense (12,659 ) (6,862 ) (23,254 ) (5,797 ) 16,392 Total other income (expense) 6,244 4,482 (17,529 ) 1,762 22,011 Loss before income taxes (227,102 ) (263,646 ) (280,405 ) 36,544 16,759 Income Tax Benefit — 152 84 (152 ) 68 Net loss $ (227,102 ) $ (263,494 ) $ (280,321 ) $ 36,392 $ 16,827 Comparison of the Years Ended December 31, 2024 and 2023 License and Royalty Revenue.
The ALTITUDE ® trial is a multi-center, open label, randomized, controlled, dose-escalation Phase II trial to evaluate the efficacy, safety and tolerability of ABBV-RGX-314 for the treatment of DR. • RGX-202: We are developing RGX-202 as an investigational one-time AAV therapeutic for the treatment of Duchenne muscular dystrophy (Duchenne), using the NAV AAV8 vector to deliver a transgene for a novel microdystrophin that includes the functional elements of the C-Terminal (CT) domain as well as a muscle-specific promoter to support a targeted therapy for improved resistance to muscle damage associated with Duchenne.
Patients will receive a one-time, in-office injection of ABBV-RGX-314 at dose level 4 (1.5x10e12 GC/eye) with short course prophylactic steroid eye drops. • RGX-202: We are developing RGX-202 as an investigational AAV therapeutic for the treatment of Duchenne muscular dystrophy (Duchenne), using the NAV AAV8 vector to deliver a transgene for a novel microdystrophin that includes the functional elements of the C-Terminal domain as well as a muscle-specific promoter to support a targeted therapy for improved resistance to muscle damage associated with Duchenne.
Cash Flows Our consolidated cash flows were as follows (in thousands): Years Ended December 31, 2023 2022 2021 Net cash provided by (used in) operating activities $ (218,407 ) $ (207,488 ) $ 218,875 Net cash provided by (used in) investing activities 190,943 (11,929 ) (406,642 ) Net cash provided by (used in) financing activities (34,966 ) (28,840 ) 195,250 Net increase (decrease) in cash and cash equivalents and restricted cash $ (62,430 ) $ (248,257 ) $ 7,483 Cash Flows from Operating Activities Our net cash used in operating activities for the year ended December 31, 2023 increased by $10.9 million from the year ended December 31, 2022.
Cash Flows Our consolidated cash flows were as follows (in thousands): Years Ended December 31, 2024 2023 2022 Net cash used in operating activities $ (173,125 ) $ (218,407 ) $ (207,488 ) Net cash provided by (used in) investing activities 103,446 190,943 (11,929 ) Net cash provided by (used in) financing activities 92,683 (34,966 ) (28,840 ) Net increase (decrease) in cash and cash equivalents and restricted cash $ 23,004 $ (62,430 ) $ (248,257 ) Cash Flows from Operating Activities Our net cash used in operating activities for the year ended December 31, 2024 decreased by $45.3 million from the year ended December 31, 2023, largely as a result of lower operating expenses and increased cost reimbursement received from AbbVie under our ABBV-RGX-314 collaboration in 2024.
We have entered into a number of long-term operating leases for office, laboratory and manufacturing space in Rockville, Maryland, Washington, D.C. and New York, New York, as well as a number of laboratory and other equipment leases. Please refer to Note 6 to the accompanying consolidated financial statements for further information regarding our lease commitments.
We have entered into a number of long-term operating leases for office, laboratory and manufacturing space in Rockville, Maryland, Washington, D.C. and New York, New York, as well as a number of laboratory and other equipment leases. As of December 31, 2024, we had recorded total lease liabilities of $82.0 million under our operating leases.
Other Income (Expense) Interest Income from Licensing In accordance with our revenue recognition policy, interest income from licensing consists of imputed interest recognized from significant financing components identified in our license agreements with NAV Technology Licensees as well as interest income accrued on unpaid balances due from licensees.
We expect that our general and administrative expenses will increase as we continue to develop, and potentially commercialize, our product candidates. Other Income (Expense) Interest Income from Licensing In accordance with our revenue recognition policy, interest income from licensing consists of imputed interest recognized from significant financing components identified in our license agreements with NAV Technology Licensees.
Zolgensma is a licensed product under our license agreement with Novartis Gene Therapies for the development and commercialization of treatments for SMA using the NAV Technology Platform. Collaboration and License Agreement with AbbVie Effective in November 2021, we entered into a collaboration and license agreement with AbbVie Global Enterprises Ltd.
Zolgensma is a licensed product under our license agreement with Novartis Gene Therapies for the development and commercialization of treatments for SMA using the NAV Technology Platform. Operating Expenses Our operating expenses consist primarily of cost of revenues, research and development expenses and general and administrative expenses.
Additionally, the parties will share equally in the net profits and net losses associated with the commercialization of ABBV-RGX-314 in the United States, and we are eligible to receive tiered royalties on net sales by AbbVie of ABBV-RGX-314 outside the United States. • In January 2021, we completed a public offering of 4,899,000 shares of our common stock (inclusive of 639,000 shares pursuant to the full exercise by the underwriters of their option to purchase additional shares) at a price of $47.00 per share.
Additionally, the parties will share equally in the net profits and net losses associated with the commercialization of ABBV-RGX-314 in the United States, and we are eligible to receive tiered royalties on net sales by AbbVie of ABBV-RGX-314 outside the United States.
General and administrative expenses increased by $3.2 million, from $85.3 million for the year ended December 31, 2022 to $88.5 million for the year ended December 31, 2023. The increase was primarily attributable to personnel-related costs, professional fees for corporate advisory services and other corporate overhead expenses. Other Operating Expenses (Income).
General and administrative expenses decreased by $11.9 million, from $88.5 million for the year ended December 31, 2023 to $76.6 million for the year ended December 31, 2024. The decrease was primarily attributable to professional services and consulting fees, including legal and other corporate advisory services, and other corporate overhead expenses. 76 Credit Losses (Recoveries).
The increase was largely attributable to a realized gain of $2.2 million recognized in 2023 upon the achievement of milestones associated with the acquisition of our non-marketable equity securities of Corlieve Therapeutics SAS (Corlieve) by uniQure N.V. (uniQure) in July 2021. The remaining increase was primarily attributable to higher yields on investments in cash equivalents and marketable debt securities.
The Company recognized realized gains of $6.6 million and $2.2 million upon the achievement of such milestones during 2024 and 2023, respectively. The remaining increase was primarily attributable to higher yields on investments in cash equivalents and marketable debt securities.
Such ongoing clinical trials include two pivotal trials, one Phase II bridging study, one Long-term Follow-up study, and a Fellow Eye Treatment study in patients with wet AMD, all utilizing subretinal delivery, as well as two Phase II clinical trials in patients with wet AMD and DR are also ongoing along with two corresponding Long-term Follow-up studies, all utilizing in-office suprachoroidal delivery.
Additionally, two Phase II clinical trials in patients with wet AMD (AAVIATE) and DR (ALTITUDE) are ongoing along with two corresponding long-term follow-up studies, all utilizing in-office suprachoroidal delivery. Within the Phase II study in DR, we are also evaluating ABBV-RGX-314 in diabetic macular edema (DME).
Amounts received by us prior to the delivery of underlying performance obligations are deferred and recognized as revenue upon the satisfaction of the performance obligations.
Amounts received by us prior to the delivery of underlying performance obligations are deferred and recognized as 73 revenue upon the satisfaction of the performance obligations. Deferred revenue which is not expected to be recognized within 12 months from the reporting date is recorded as non-current on the consolidated balance sheets.
We believe that RGX-121 is likely to be eligible for priority review, especially if no other gene therapy product for MPS II is approved before submission of a BLA for RGX-121, and potential approval of the Company's planned BLA for RGX-121 could result in receipt of a Rare Pediatric Disease Priority Review Voucher in 2025, assuming the statutory criteria are met.
We expect potential approval of RGX-121 in the second half of 2025. Potential approval of the BLA for RGX-121 could result in receipt of a Rare Pediatric Disease Priority Review Voucher in 2025, assuming the statutory criteria are met.
The favorable changes in operating assets and liabilities were partially offset by a net decrease in total accounts payable and accrued expenses and other current liabilities of $6.8 million, which was driven primarily by decreases in accrued sublicense fees and royalties and income taxes payable.
The favorable changes in operating assets and liabilities were partially offset by a decrease in accrued expenses and other current liabilities of $12.1 million, which was driven primarily by decreases in accruals for external research and development services and sublicense and royalties due to licensors. Other changes in operating working capital occurred in the normal course of business.
General and Administrative Expense Our general and administrative expenses consist primarily of salaries, wages and personnel-related costs, including benefits, travel and stock-based compensation, for employees performing functions other than research and development. This includes certain personnel in executive, commercial, corporate development, finance, legal, human resources, information technology, facilities and administrative support functions.
We expect to continue to incur minor development expenses associated with long-term follow up studies for certain discontinued product candidates. General and Administrative Expense Our general and administrative expenses consist primarily of salaries, wages and personnel-related costs, including benefits, travel and stock-based compensation, for employees performing functions other than research and development.
The AbbVie Collaboration Agreement may materially impact our future revenues, research and development expenses, other operating expenses and operating cash flows associated with the development and commercialization of ABBV-RGX-314. For additional information regarding the AbbVie Collaboration Agreement, please refer to Note 10, “License and Collaboration Agreements—AbbVie Collaboration and License Agreement” to the accompanying audited consolidated financial statements.
For additional information regarding the Nippon Shinyaku Collaboration Agreement, please refer to Note 10, “License and Collaboration Agreements—Nippon Shinyaku Collaboration and License Agreement” to the accompanying audited consolidated financial statements.
For the year ended December 31, 2022, our net cash used in financing activities primarily consisted of $33.1 million of Zolgensma royalties paid to HCR, net of imputed interest, under our royalty purchase agreement, and was partially offset by $4.5 million in proceeds received from the exercise of stock options and issuance of common stock under our employee stock purchase plan.
Cash Flows from Financing Activities For the year ended December 31, 2024, our net cash provided by financing activities primarily consisted of $131.1 million in net proceeds received from the public offering of common stock and pre-funded warrants completed in March 2024, net of underwriting discounts and commissions and other offering expenses paid during the period, and $2.7 million in proceeds received from the exercise of stock options and issuance of common stock under our employee stock purchase plan.
In addition, we may not achieve the expected benefits of any cost reduction measures on our currently anticipated timeline, or at all. Furthermore, our estimates are based on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect which could accelerate our liquidity needs.
Additionally, our estimates are based on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect which could accelerate our liquidity needs. 77 At-the-Market Offering Programs In September 2023, we entered into an ATM Equity Offering SM Sales Agreement with BofA Securities, Inc.
Interest Expense . Interest expense decreased by $16.4 million, from $23.3 million for the year ended December 31, 2022 to $6.9 million for the year ended December 31, 2023.
Research and development expenses decreased by $23.7 million, from $232.3 million for the year ended December 31, 2023 to $208.5 million for the year ended December 31, 2024.
Further, we will be seeking strategic alternatives, including potential partnering, for our other clinical stage product candidates: (i) RGX-111 for the treatment of Mucopolysaccharidosis Type I (MPS I), (ii) RGX-181 for the treatment of late-infantile neuronal ceroid lipofuscinosis type 2 (CLN2) disease, and (iii) RGX-381 for the treatment of the ocular manifestations of CLN2 disease.
Efforts to continue development of RGX-111 are set to be reinitiated following our announcement in January 2025 of a strategic partnership with Nippon Shinyaku. 67 Strategic Pipeline Prioritization and Restructuring In November 2023, we implemented a strategic pipeline prioritization and corporate restructuring designed to prioritize the development of ABBV-RGX-314, RGX-202 and RGX-121, and to seek strategic alternatives for our other clinical stage product candidates: (i) RGX-111 for the treatment of MPS I, (ii) RGX-181 for the treatment of late-infantile neuronal ceroid lipofuscinosis type 2 (CLN2) disease, and (iii) RGX-381 for the treatment of the ocular manifestations of CLN2 disease.
Deferred revenue which is not expected to be recognized within 12 months from the reporting date is recorded as non-current on the consolidated balance sheets. 72 Table of Contents Collaborative Arrangements We evaluate our agreements with collaboration partners to determine whether they are within the scope of ASC 808, Collaborative Arrangements (ASC 808).
Collaborative Arrangements We evaluate our agreements with collaboration partners to determine whether they are within the scope of ASC 808, Collaborative Arrangements (ASC 808).
Our recent sources of liquidity include the following events and transactions: • Effective in November 2021, we entered into the AbbVie Collaboration Agreement for the development and commercialization of ABBV-RGX-314.
The aggregate net proceeds received from the offering were $131.1 million, net of underwriting discounts and commissions and offering expenses. • In September 2021, we entered into the AbbVie Collaboration Agreement for the development and commercialization of ABBV-RGX-314.
Adjustments for non-cash items primarily consisted of stock-based compensation expense of $40.3 million and depreciation and amortization expense of $17.3 million.
Adjustments for non-cash items primarily consisted of stock-based compensation expense of $38.5 million and depreciation and amortization expense of $16.2 million, partially offset by realized gains on investments, credit recoveries and the accretion of discounts on marketable debt securities during the period.
(AbbVie), a subsidiary of AbbVie Inc., to jointly develop and commercialize ABBV-RGX-314 (the AbbVie Collaboration Agreement). We recognized license and royalty revenue of $370.0 million upon the effective date of the collaboration in November 2021.
For additional information regarding the corporate restructuring, please refer to Note 14, “Restructuring” to the accompanying audited consolidated financial statements. Collaboration and License Agreement with AbbVie In September 2021, we entered into a collaboration and license agreement with AbbVie Global Enterprises Ltd. (AbbVie), a subsidiary of AbbVie Inc., to jointly develop and commercialize ABBV-RGX-314 (the AbbVie Collaboration Agreement).
We plan to use levels of cerebrospinal fluid D2S6 as a surrogate endpoint for accelerated approval and we are completing remaining activities in order to support a BLA submission in the second half of 2024.
We plan to use levels of cerebrospinal fluid Heparan sulfate D2S6 as a surrogate endpoint reasonably likely to predict clinical benefit for accelerated approval. A BLA for RGX-121 seeking accelerated approval was submitted to the FDA in March 2025, which we believe is likely to be eligible for priority review.
The decrease in research and development expenses for ABBV-RGX-314 was largely driven by a shift in the development cost sharing arrangement under our collaboration with AbbVie beginning in 2023.
The decrease in research and development expenses was partially offset by an increase of $10.5 million in costs associated with clinical trial activities, largely driven by clinical trial expenses for ABBV-RGX-314 and RGX-202. General and Administrative Expense.
Investment income increased by $5.9 million, from $5.4 million for the year ended December 31, 2022 to $11.3 million for the year ended December 31, 2023.
Investment income increased by $7.4 million, from $11.3 million for the year ended December 31, 2023 to $18.7 million for the year ended December 31, 2024. The increase was largely attributable to the achievement of milestones associated with the acquisition of our non-marketable equity securities of Corlieve Therapeutics SAS (Corlieve) by uniQure N.V. (uniQure) in July 2021.
Removed
ABBV-RGX-314 is currently being evaluated in nine ongoing clinical trials in the United States and Canada.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−0 removed5 unchanged
Biggest changeIf market interest rates were to increase immediately and uniformly by 100 basis points, or one percentage point, from levels at December 31, 2023, we estimate that the increase would have resulted in a hypothetical decline of $1.5 million in the net fair value of our interest-sensitive securities.
Biggest changeIf market interest rates were to increase immediately and uniformly by 100 basis points, or one percentage point, from levels at December 31, 2024, we estimate that the increase would have resulted in a hypothetical decline of $0.8 million in the net fair value of our interest-sensitive securities as of December 31, 2024.
As of December 31, 2023 and 2022, we had cash, cash equivalents and marketable securities of $314.1 million and $565.2 million, respectively. Our cash equivalents and marketable securities as of December 31, 2023 consisted of money market mutual funds, U.S. government and agency securities, certificates of deposit and corporate bonds.
As of December 31, 2024 and 2023, we had cash, cash equivalents and marketable securities of $244.9 million and $314.1 million, respectively. Our cash equivalents and marketable securities as of December 31, 2024 consisted of money market mutual funds, U.S. government and agency securities, certificates of deposit and corporate bonds.
A similar increase in market interest rates as of December 31, 2022 would have resulted in an estimated hypothetical decline of $4.0 million in the net fair value of our interest-sensitive securities as of December 31, 2022.
A similar increase in market interest rates as of December 31, 2023 would have resulted in an estimated hypothetical decline of $1.5 million in the net fair value of our interest-sensitive securities as of December 31, 2023.

Other RGNX 10-K year-over-year comparisons