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

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Paragraph-level year-over-year comparison of Viridian Therapeutics, Inc.\DE'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.

+785 added−656 removedSource: 10-K (2024-12-31) vs 10-K (2023-12-31)

Top changes in Viridian Therapeutics, Inc.\DE's 2024 10-K

785 paragraphs added · 656 removed · 523 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

234 edited+115 added−62 removed166 unchanged
Biggest changeA non-exhaustive list of other companies that are advancing therapies in clinical development for the treatment of TED or to target FcRn include: • ACELYRIN, INC. is developing lonigutamab (VB-421), a subcutaneously delivered anti-IGF-1R currently being evaluated in a Phase 1/2 study for TED. • Argenx is developing efgartigimod (“Vyvgart®”), an antibody fragment to target the neonatal Fc receptor (FcRn) that is subcutaneously delivered and expected to be evaluated in a registrational Phase 3 trial in patients with TED. • Immunovant and Harbour BioMed are developing batoclimab (IMVT-1401/HBM9161) and IMVT-1402.
Biggest changeA non-exhaustive list of companies currently advancing therapies in clinical development for the treatment of TED include: • Amgen is developing an on-body subcutaneous formulation of Tepezza in a phase 3 study and has an early-stage candidate AMG-732 in TED. • Argenx is developing efgartigimod (Vyvgart), an antibody fragment to target the FcRn that is subcutaneously delivered and expected to be evaluated in a registrational phase 3 trial in patients with TED. • Immunovant, Inc. is developing a subcutaneous formulation of batoclimab in phase 3 studies in patients with active TED. • Roche is developing satralizumab (Enspryng), an anti-1L-6R that is subcutaneously delivered and is being evaluated in a phase 3 trial in patients with active TED. • Sling Therapeutics, Inc. is developing linsitinib, a small molecule IGF-1R inhibitor currently being evaluated in an ongoing phase 2b/3 study in patients with active TED and currently has plans to initiate a phase 3 trial. • Tourmaline Bio is developing TOUR006, a subcutaneously delivered anti-IL-6, in an ongoing phase 2b clinical trial in patients with active TED. • Lassen Therapeutics is developing LASN01, an intravenously delivered anti-1L-11R currently being evaluated in a phase 2 study in active TED. 19 • ACELYRIN, INC. is developing lonigutamab (VB-421), a subcutaneously delivered anti-IGF-1R currently being evaluated in a phase 1/2 study in patients with TED.
FcRn inhibitors have the potential to treat a broad array of autoimmune diseases, representing a possible significant commercial market opportunity.
FcRn inhibitors have the potential to treat a broad array of autoimmune diseases, representing a possible significant commercial market opportunity.
Under the terms of the Paragon Agreement, Paragon will perform certain development activities in accordance with an agreed upon research plan, and we will pay Paragon agreed upon development fees in exchange for Paragon’s commitment of the necessary personnel and resources to perform these activities.
Under the terms of the Paragon Research Agreement, Paragon will perform certain development activities in accordance with an agreed upon research plan, and we will pay Paragon agreed upon development fees in exchange for Paragon’s commitment of the necessary personnel and resources to perform these activities.
The Paragon Agreement stipulates a final deliverable to us comprising of a report summarizing the experiments and processes performed under the research plan (the “Final Deliverable”).
The Paragon Research Agreement stipulates a final deliverable to us comprising of a report summarizing the experiments and processes performed under the research plan (the “Final Deliverable”).
The ACA contains a number of provisions of particular import to the pharmaceutical and biotechnology industries, including, but not limited to, those governing enrollment in federal healthcare programs, a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, and annual fees based on pharmaceutical companies’ share of sales to federal health care programs.
The ACA contains a number of provisions of particular import to the pharmaceutical and biotechnology industries, including, but not limited to, those governing enrollment in federal healthcare programs, a new methodology by which rebates owed by manufacturers under the 38 Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, and annual fees based on pharmaceutical companies’ share of sales to federal health-care programs.
A kick-off meeting with the CHMP/CAT rapporteur initiates these relationships and includes a team of multidisciplinary experts to provide guidance on the overall development plan and regulatory strategy. PRIME eligibility does not change the standards for product approval, and there is no assurance that any such designation or eligibility will result in expedited review or approval.
A kick-off meeting with the CHMP/CAT rapporteur initiates these relationships and includes a team of multidisciplinary experts to provide guidance on the overall development plan and 34 regulatory strategy. PRIME eligibility does not change the standards for product approval, and there is no assurance that any such designation or eligibility will result in expedited review or approval.
We may, at our sole discretion, exercise the Option with respect to 18 specified programs (“Programs”) at any time until the date that is 90 days after the Company’s receipt of the Final Deliverable the applicable program, or such longer period as agreed upon by the parties (“Option Period”) by delivering written notice of such exercise to Paragon.
We may, at our sole discretion, exercise the Option with respect to specified programs (“Programs”) at any time until the date that is 90 days after the Company’s receipt of the Final Deliverable the applicable program, or such longer period as agreed upon by the parties (“Option Period”) by delivering written notice of such exercise to Paragon.
Failure to comply with these obligations could lead to government enforcement actions and significant penalties against us, harm to our reputation, and adversely impact our business and operating results. The uncertainty regarding the interplay between different regulatory frameworks, such as the CTR and the GDPR, further adds to the complexity that we face with regard to data protection regulation.
Failure to comply with these obligations could lead to government enforcement actions and significant penalties against us, harm to our reputation, and adversely impact our business and operating results. The uncertainty regarding the 30 interplay between different regulatory frameworks, such as the CTR and the GDPR, further adds to the complexity that we face with regard to data protection regulation.
Accelerated evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is expected 28 to be of a major public health interest, particularly from the point of view of therapeutic innovation. Upon request, the CHMP can reduce the time frame to 150 days if the applicant provides sufficient justification for an accelerated assessment.
Accelerated evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is expected to be of a major public health interest, particularly from the point of view of therapeutic innovation. Upon request, the CHMP can reduce the time frame to 150 days if the applicant provides sufficient justification for an accelerated assessment.
Civil and criminal false claims laws, including the FCA, and civil monetary penalty laws, which can be enforced through civil whistleblower or qui tam actions, prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment of federal government funds, including in federal healthcare programs, that are false or fraudulent.
Civil and criminal false claims laws, including the FCA, and civil monetary penalty laws, which can be enforced through civil whistleblower or qui tam actions, prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment of federal government funds, including in federal healthcare programs, that are false or 36 fraudulent.
In light of our reliance on WuXi, we are taking several measures to strengthen our supply chain by moving certain CDMO activities outside of WuXi’s Chinese facilities. See “Risk Factors” for additional information. Sales and Marketing We have not yet defined our sales, marketing, or product distribution strategy for our product candidates because our product candidates are still in development.
In light of our reliance on WuXi, we are taking several measures to strengthen our supply chain by moving certain CDMO activities outside of WuXi’s facilities. See “Risk Factors” for additional information. Sales and Marketing We have not yet defined our sales, marketing, or product distribution strategy for our product candidates because our product candidates are still in development.
Further, subcutaneous offerings can also grow the overall market size for their class. We believe VRDN-003 has significant potential to 13 capture a meaningful proportion of the IV TED market and to grow the TED market as a convenient, less-frequent, low-volume subcutaneous anti-IGF-1R antibody that patients take at home.
Further, subcutaneous offerings can also grow the overall market size for their class. We believe VRDN-003 has significant potential to capture a meaningful proportion of the IV TED market and to grow the TED market as a convenient, less-frequent, low-volume subcutaneous anti-IGF-1R antibody that patients take at home.
Even when HIPAA does not apply, according to the Federal Trade Commission, violating consumers’ privacy rights or failing to take appropriate steps to keep consumers’ personal information secure, including medical and health-related information, may constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act.
Even when HIPAA does not apply, according to the Federal Trade Commission, violating consumers’ privacy rights or failing to take appropriate steps to keep consumers’ personal information secure, including medical and health-related information, may constitute unfair or deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act.
Many benefits accrue to sponsors of product candidates with PRIME designation, including but not limited to, early and proactive regulatory dialogue with the EMA, frequent discussions on clinical trial designs and other 30 development program elements, and potentially accelerated MAA assessment once a dossier has been submitted.
Many benefits accrue to sponsors of product candidates with PRIME designation, including but not limited to, early and proactive regulatory dialogue with the EMA, frequent discussions on clinical trial designs and other development program elements, and potentially accelerated MAA assessment once a dossier has been submitted.
ITEM 1. BUSINESS Company Overview We are a biopharmaceutical company focused on discovering and developing potential best-in-class medicines for serious and rare diseases. We target disease areas where marketed therapies often leave room for improvements in efficacy, safety, and/or dosing convenience.
ITEM 1. BUSINESS Company Overview We are a biopharmaceutical company focused on discovering, developing, and commercializing potential best-in-class medicines for serious and rare diseases. We target disease areas where marketed therapies often leave room for improvements in efficacy, safety, and/or dosing convenience.
Patients with active and chronic TED experience significant impairment to their quality of life, including difficulties activities of daily living, trouble functioning in social situations, and decreased psychological well-being. About one in every three patients experience anxiety and depression.
Patients with active and chronic TED experience significant impairment to their quality of life, including difficulties with the activities of daily living, trouble functioning in social situations, and decreased psychological well-being. About one in every three patients experience anxiety and depression.
We have built relevant expertise in protein and antibody discovery and engineering, biologics manufacturing, nonclinical and clinical development for thyroid eye disease (“TED”), development of anti-neonatal Fc receptor (“FcRn”) therapies, and nonclinical and clinical development for indications in rare and autoimmune diseases.
We have built relevant expertise in protein and antibody discovery and engineering, biologics manufacturing, nonclinical and clinical development, and commercialization for thyroid eye disease (“TED”), development of anti-neonatal Fc receptor (“FcRn”) therapies, and nonclinical and clinical development for indications in rare and autoimmune diseases.
The GDPR imposes a number of strict obligations and restrictions on the ability to process, including collecting, analyzing and transferring, personal data of individuals, in particular 26 with respect to health data from clinical trials and adverse event reporting.
The GDPR imposes a number of strict obligations and restrictions on the ability to process, including collecting, analyzing and transferring, personal data of individuals, in particular with respect to health data from clinical trials and adverse event reporting.
The CCPA/CPRA applies to personal data of consumers, business contacts, and employees, and imposes obligations on certain businesses that do business in California, including to provide specific disclosures in privacy notices and rights to California residents in relation to their personal information.
The CCPA applies to personal data of consumers, business contacts, and employees, and imposes obligations on certain businesses that do business in California, including to provide specific disclosures in privacy notices and rights to California residents in relation to their personal information.
Such laws include, without limitation: the 31 federal Anti-Kickback Statute (“AKS”); the federal False Claims Act (“FCA”); the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and similar foreign, federal and state fraud, abuse and transparency laws.
Such laws include, without limitation: the federal Anti-Kickback Statute (“AKS”); the federal False Claims Act (“FCA”); the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and similar foreign, federal and state fraud, abuse and transparency laws.
In December 2022, we and Paragon entered into a first amendment to the Paragon Agreement, under which we obtained an additional limited license for the purpose of conducting certain activities.
In December 2022, we and Paragon entered into a first amendment to the Paragon Research Agreement, under which we obtained an additional limited license for the purpose of conducting certain activities.
Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement rates, but also have their 34 own methods and approval process apart from Medicare determinations.
Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement rates, but also have their own methods and approval process apart from Medicare determinations.
However, the transitional provisions, adopted with the IDTA and the Addendum, provide that contracts concluded on or before September 21, 2022 on the basis of any old SCCs continue to provide appropriate safeguards for the purpose of the UK regime until March 21, 2024, provided that the processing operations that are the subject matter of the contract remain unchanged and reliance on those clauses ensures that the transfer of personal data is subject to appropriate safeguards.
However, the transitional provisions, adopted with the IDTA and the Addendum, provide that contracts concluded on or before September 21, 2022 on the basis of any old SCCs continued to provide appropriate safeguards for the purpose of the UK regime until March 21, 2024, provided that the processing operations that are the subject matter of the contract remain unchanged and reliance on those clauses ensures that the transfer of personal data is subject to appropriate safeguards.
We plan to continue to identify and advance novel product candidates and technologies to generate potential best-in-class protein and antibody therapeutics, either internally or through in-licensing. 9 Our Pipeline Thyroid Eye Disease (TED) TED, commonly associated with Graves’ Disease, and in some cases referred to as Graves’ orbitopathy, is a serious and rare autoimmune disorder affecting the eye and its adjacent tissue.
We plan to continue to identify and advance novel product candidates and technologies to generate potential best-in-class protein and antibody therapeutics, either internally or through in-licensing. 10 Our Pipeline Thyroid Eye Disease (TED) TED, commonly associated with Graves’ Disease, and in some cases referred to as Graves’ orbitopathy, is a serious and rare autoimmune disorder affecting the eye and its adjacent tissue.
We do not 36 intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other company.
We do not intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other company.
We intend to prioritize indications where a fast-follower and a potentially differentiated drug candidate, or overall product profile, could create significant medical benefit for patients. We are engineering medicines to address unmet medical needs for patients and further advance drug innovation. Our goal is to identify and evaluate product concepts leveraging clinically validated molecular targets using established therapeutic modalities.
We intend to prioritize indications where a fast-follower and a potentially differentiated drug candidate, or overall product profile, could create significant medical benefit for patients. We are engineering product candidates to address unmet medical needs for patients and further advance drug innovation. Our goal is to identify and evaluate product concepts leveraging clinically validated molecular targets using established therapeutic modalities.
If a product that has orphan drug designation subsequently receives the first FDA approval for the disease for which it has such designation, the product is entitled to orphan drug exclusive approval (or exclusivity), which means that the FDA may not approve any other applications, including a full BLA, to market the same product for the same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity.
If a product that has orphan drug designation subsequently receives the first FDA approval for the disease for which it has such designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any other applications, including a full BLA, to market the same product for the same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity.
Thus, if the primary mode of action of a drug- 23 device combination product is attributable to the drug product, the FDA center responsible for premarket review of the drug product would have primary jurisdiction for the combination product.
Thus, if the primary mode of action of a drug-device combination product is attributable to the drug product, the FDA center responsible for premarket review of the drug product would have primary jurisdiction for the combination product.
This was consistent with the increases in IGF-1 levels that have been shown in the clinic following a single dose of VRDN-001 SC and IV. IGF-1 is a PD biomarker for IGF-1R target engagement. • Well-Tolerated : VRDN-003 was well tolerated in all subjects with no SAEs. All treatment-related, treatment-emergent adverse events were grade 1 (mild).
This was consistent with the increases in IGF-1 levels that have been shown in the clinic following a single dose of veligrotug SC and IV. IGF-1 is a PD biomarker for IGF-1R target engagement. • Well-Tolerated : VRDN-003 was well tolerated in all subjects with no SAEs. All treatment-related, treatment-emergent adverse events were grade 1 (mild).
When available to expand market exclusivity, our strategy is to obtain or license additional intellectual property related to core elements of technology and/or product candidates.
When available to expand 18 market exclusivity, our strategy is to obtain or license additional intellectual property related to core elements of technology and/or product candidates.
The overall ten-year period will be extended to a maximum of eleven years if, during the first eight of those ten years, the marketing authorization holder obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies.
The overall ten-year period can be extended to a maximum of eleven years if, during the first eight of those ten years, the marketing authorization holder obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies.
Anti-FcRn Portfolio: VRDN-006 and VRDN-008 In October 2023, consistent with our vision to develop the next generation of best-in-class products for severe autoimmune and rare diseases, we unveiled VRDN-006 and VRDN-008 from our portfolio of engineered FcRn inhibitors. FcRn inhibitors have the potential to treat a broad array of autoimmune diseases, representing a possible significant commercial market opportunity.
FcRn Inhibitor Portfolio: VRDN-006 and VRDN-008 In October 2023, consistent with our vision to develop the next generation of best-in-class products for severe autoimmune and rare diseases, we unveiled VRDN-006 and VRDN-008 from our portfolio of engineered FcRn inhibitors. FcRn inhibitors have the potential to treat a broad array of autoimmune diseases, representing a possible significant commercial market opportunity.
We plan to cultivate a network across TED stakeholders to inform our patient-centric approach, including with patients and advocacy groups, key opinion leaders, research institutions, healthcare professionals and payers. ◦ Prepare for commercialization of VRDN-001 and VRDN-003, for the treatment of patients with TED. We hold worldwide commercialization rights, excluding the greater area of China, to VRDN-001 and VRDN-003.
We plan to cultivate a network across TED stakeholders to inform our patient-centric approach, including with patients and advocacy groups, key opinion leaders, research institutions, healthcare professionals and payers. ◦ Prepare for commercialization of veligrotug and VRDN-003, for the treatment of patients with TED. We hold worldwide commercialization rights, excluding the greater area of China, to veligrotug and VRDN-003.
The regulatory authorities may also impose specific obligations as a condition of the MA. Since October 30, 2023, all RMPs for centrally authorized products are published by the EMA subject only to limited redactions. MA Validity Period and Exclusivity Marketing Authorizations have an initial duration of five years.
The regulatory authorities may also impose specific obligations as a condition of the marketing authorization. Since October 30, 2023, all RMPs for centrally authorized products are published by the EMA subject only to limited redactions. Marketing Authorization Validity Period and Exclusivity Marketing Authorizations have an initial duration of five years.
During this 12-year period of exclusivity, another company may still market a competing version of the reference product if the FDA approves a full BLA for the competing product containing that applicant’s own preclinical data and data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of its product.
During this 12-year period of exclusivity, another company may still market a competing version of the reference product if the FDA approves a full BLA for the competing product containing that applicant’s own nonclinical data and data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of its product.
These clinical trials are intended to establish the overall risk/benefit ratio of the investigational product and to provide an adequate basis for product approval. 20 In some cases, the FDA may require, or companies may voluntarily pursue, additional clinical trials after a product is approved to gain more information about the product.
These clinical trials are intended to establish the overall risk/benefit ratio of the investigational product and to provide an adequate basis for product labeling and approval. In some cases, the FDA may require, or companies may voluntarily pursue, additional clinical trials after a product is approved to gain more information about the product.
Although we have designed VRDN-003 to have a superior dosing profile to its parent molecule, VRDN-001, as well as to the currently marketed IV product, teprotumumab, market examples demonstrate that subcutaneous therapies have commanded market share even where such therapies have the same or worse dosing frequency than their IV counterparts.
Although we have designed VRDN-003 to have a superior dosing profile to its parent molecule, veligrotug, as well as to the currently marketed IV product, teprotumumab, market examples demonstrate that subcutaneous therapies have commanded market share even where such therapies have the same or worse dosing frequency than their IV counterparts.
Our common stock currently trades on The Nasdaq Capital Market under the ticker symbol “VRDN.” Our principal executive office is located at 221 Crescent Street, Suite 401, Waltham, MA 02453, and our telephone number is (617) 272-4600. Our website address is www.viridiantherapeutics.com.
Our common stock currently trades on The Nasdaq Capital Market under the ticker symbol “VRDN.” Our principal executive office is located at 221 Crescent Street, Suite 103A, Waltham, MA 02453, and our telephone number is (617) 272-4600. Our website address is www.viridiantherapeutics.com.
The BLA must include all relevant data available from pertinent preclinical studies and clinical trials, including negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s chemistry, manufacturing, controls, and proposed labeling, among other things.
The BLA must include all relevant data available from pertinent nonclinical studies and clinical trials, including negative or ambiguous results as well as positive findings, together with detailed information relating to the product’s chemistry, manufacturing, controls, and proposed labeling, among other things.
The fast track program is intended to expedite or facilitate the process for reviewing new products that meet certain criteria. Specifically, new products are eligible for fast track designation if they are intended to treat a serious or life-threatening disease or condition and demonstrate the potential to address unmet medical needs for the disease or condition.
The fast track program is intended to expedite or facilitate the process for developing new products that meet certain criteria. Specifically, new products are eligible for fast track designation if they are intended to treat a serious or life-threatening disease or condition and demonstrate the potential to address unmet medical needs for the disease or condition.
Post-Approval Requirements Any products manufactured or distributed by us pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to record-keeping, reporting of adverse experiences, periodic reporting, product sampling and distribution, and advertising and promotion of the product.
Post-Approval Requirements Any products manufactured or distributed by us pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to record-keeping, reporting of adverse experiences, periodic reporting, product sampling and distribution, manufacturing, testing and advertising and promotion of the product.
The reports are also available at the SEC’s internet website at www.sec.gov. A copy of our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and the charters of the Audit Committee, Compensation Committee, Nominative and Corporate Governance Committee and Science and Technology Committee are posted on our website, www.viridiantherapeutics.com, under “Corporate Governance.”
The reports are also available at the SEC’s internet website at www.sec.gov. A copy of our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and the charters of the Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee, and Science and Technology Committee are posted on our website, www.viridiantherapeutics.com, under “Corporate Governance.”
In two randomized, double-blind placebo-controlled trials, infusions of teprotumumab every three weeks, for a total of eight doses, led to a greater than 2 mm decrease in proptosis in 71% and 83% of patients, respectively, compared to 20% and 10% with placebo.
In two randomized, double-blind placebo-controlled trials, infusions of teprotumumab every three weeks, for a total of eight doses, led to a greater than 2 mm decrease in proptosis in 71% and 83% of patients with active TED, respectively, compared to 20% and 10% with placebo.
In January 2020, Tepezza® (teprotumumab), an antibody that blocks the activation of IGF-1R, was approved by the FDA for the treatment of TED. The Tepezza® label was updated in April 2023 to specify its use for the treatment of TED regardless of TED activity or duration.
In January 2020, Tepezza (teprotumumab), an antibody that blocks the activation of IGF-1R, was approved by the FDA for the treatment of TED. The Tepezza labeling was updated in April 2023 to specify its use for the treatment of TED regardless of TED activity or duration.
In addition, the label was updated in its warnings and precautions, adverse reactions, and patient counseling information sections in December 2022 with additional information on hyperglycemia and in July 2023 to include hearing impairment, its potential severity, and guidance for monitoring.
In addition, the labeling was updated in its warnings and precautions, adverse reactions, and patient counseling information sections in December 2022 with additional information on hyperglycemia and in July 2023 to include hearing impairment, its potential severity, and guidance for monitoring.
Regulation of Combination Products Certain therapeutic products are comprised of multiple components, such as drug components and device components, that would normally be subject to different regulatory frameworks by the FDA and frequently regulated by different centers at the FDA. These products are known as combination products.
Regulation of Combination Products Certain therapeutic products comprise multiple components, such as drug components and device components, that would normally be subject to different regulatory frameworks by the FDA and frequently regulated by different centers at the FDA. These products are known as combination products.
The modeling showed that dosing VRDN-003 every eight weeks, every four weeks, and every two weeks achieved a range of exposures levels that were seen for VRDN-001 after intravenous doses of 3 mg/kg, 10 mg/kg and 20 mg/kg, respectively.
The modeling showed that dosing VRDN-003 every eight weeks, every four weeks, and every two weeks achieved a range of exposures levels that were seen for veligrotug after intravenous doses of 3 mg/kg, 10 mg/kg and 20 mg/kg, respectively.
The proof-of-concept portion of this double-blind, placebo-controlled Phase 1/2 trial evaluated two infusions of VRDN-001 administered intravenously, three weeks apart, with efficacy measured six weeks after the first dose. VRDN-001 was evaluated at doses of 3, 10, and 20 mg/kg, with each cohort designed to include six patients randomized to drug, and two patients randomized to placebo.
The proof-of-concept portion of this double-blind, placebo-controlled phase 1/2 trial evaluated two infusions of veligrotug administered intravenously, three weeks apart, with efficacy measured six weeks after the first dose. Veligrotug was evaluated at doses of 3, 10, and 20 mg/kg, with each cohort designed to include six patients randomized to drug, and two patients randomized to placebo.
The proof-of-concept portion of this double-blind, placebo-controlled Phase 1/2 trial evaluated two infusions of VRDN-001 administered intravenously, three weeks apart, with efficacy measured six weeks after the first dose. VRDN-001 was evaluated at doses of 3 and 10 mg/kg, with each cohort designed to include six patients randomized to drug, and two patients randomized to placebo.
The proof-of-concept portion of this double-blind, placebo-controlled phase 1/2 trial evaluated two infusions of veligrotug administered intravenously, three weeks apart, with efficacy measured six weeks after the first dose. Veligrotug was evaluated at doses of 3 and 10 mg/kg, with each cohort designed to include six patients randomized to drug, and two patients randomized to placebo.
Only one patent applicable to an approved product is eligible for the extension and the application for the extension must be submitted prior to the expiration of the patent. The USPTO in consultation with the FDA, reviews and approves the application for any patent term extension or restoration.
Only one patent applicable to an approved product is eligible for the extension and the application for the extension must be submitted prior to the expiration of the patent. The USPTO in consultation with the FDA, reviews and approves the application for any patent term extension.
A large majority of our employees have obtained advanced degrees in their professions. We support our employees’ further development with individualized development plans, mentoring, coaching, group training and conference attendance. Our Corporate Information We were initially founded as a Delaware limited liability company in January 2010 and subsequently incorporated as a Delaware corporation in June 2014.
A large majority of our employees have obtained advanced degrees in their professions. We support our employees’ further development with individualized development plans, mentoring, coaching, group training and conference attendance. Our Corporate Information We were initially founded as miRagen Therapeutics, Inc. as a Delaware limited liability company in January 2010 and subsequently incorporated as a Delaware corporation in June 2014.
Across all VRDN-001 treated patients in the chronic TED trial, 42% were proptosis responders, 40% achieved a CAS of 0 or 1, and no patients had complete resolution of their diplopia. In the Phase 1/2 clinical trials of both active and chronic TED, VRDN-001 had a favorable safety profile and was well-tolerated by all patients treated in all dose cohorts.
Across all veligrotug treated patients in the chronic TED trial, 42% were proptosis responders, 40% achieved a CAS of 0 or 1, and no patients had complete resolution of their diplopia. In the phase 1/2 clinical trials of both active and chronic TED, veligrotug had a favorable safety profile and was well-tolerated by all patients treated in all dose cohorts.
A fast track product may also be eligible for rolling review, where 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 BLA, the FDA agrees to accept sections of the BLA and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the BLA.
A fast track product may also be eligible for rolling review, where the FDA may review sections of the BLA on a rolling basis before the complete application is submitted, if the applicant provides a schedule for the submission of the sections of the BLA, the FDA agrees to accept sections of the BLA and determines that the schedule is acceptable, and the applicant pays any required user fees upon submission of the first section of the BLA.
We focus on advancing therapeutic proteins, including antibodies, that we either in-license or discover internally, incorporating proprietary therapeutic protein and antibody discovery and optimization platforms to advance clinical candidates with unique characteristics.
We focus on advancing therapeutic proteins that we either in-license or discover internally, incorporating proprietary therapeutic protein and antibody discovery and optimization platforms to advance clinical candidates with unique characteristics.
The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, must develop methods for testing the identity, strength, quality and purity of the final product, or for biologics, the safety, purity and potency.
The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, must include methods for testing the identity, strength, quality and purity of the final product, or for biologics, the safety, purity and potency.
Products from small- and medium-sized enterprises may qualify for earlier entry into the PRIME scheme than larger companies on the basis of compelling non-clinical data and tolerability data from initial clinical trials.
Products from small- and medium-sized enterprises may qualify for earlier entry into the PRIME scheme than larger companies on the basis of compelling nonclinical data and tolerability data from initial clinical trials.
The only exception to this is where the competent authority of an EU Member State considers that there are concerns of potential serious risk to public health, the disputed points are subject to a dispute resolution mechanism and may eventually be referred to the EC, whose decision is binding for all EU Member States.
The only exception to this is where the competent authority of a CMS considers that there are concerns of potential serious risk to public health, the disputed points are subject to a dispute resolution mechanism and may eventually be referred to the EC, whose decision is binding for all EU Member States.
Because of the similarities of VRDN-001 and VRDN-003, we expect VRDN-003 to have similar clinical responses at the exposure levels of VRDN-001 that led to robust clinical activity in its Phase 2 clinical study in TED.
Because of the similarities of veligrotug and VRDN-003, we expect VRDN-003 to have similar clinical responses at the exposure levels of veligrotug that led to robust clinical activity in its phase 2 clinical study in TED.
We previously announced positive results from all three dose cohorts, and VRDN-001 demonstrated a favorable safety profile. In the 3 mg/kg dose cohort, nine patients were randomized to receive VRDN-001 to enable all consented patients who were eligible following screening to participate in the trial, and two patients were randomized to receive placebo.
We previously announced positive results from all three dose cohorts, and veligrotug demonstrated a favorable safety profile. In the 3 mg/kg dose cohort, nine patients were randomized to receive veligrotug to enable all consented patients who were eligible following screening to participate in the trial, and two patients were randomized to receive placebo.
Products may not be granted data exclusivity since there is no guarantee that a product will be considered by the EU’s regulatory authorities to include an NCE.
Products may not be granted data exclusivity since there is no guarantee that a product will be considered by the EU’s regulatory authorities to include an NAS.
In consideration for rights granted by ImmunoGen, we are obligated to make certain development milestone payments of up to $48.0 million. In December 2021, we paid a $2.5 million milestone payment to ImmunoGen upon the submission of an IND application for VRDN-001 with the FDA.
In consideration for rights granted by ImmunoGen, we are obligated to make certain development milestone payments of up to $48.0 million. In December 2021, we paid a $2.5 million milestone payment to ImmunoGen upon the submission of an IND application for veligrotug with the FDA.
In October 2023, we entered into a License Agreement with Paragon (the “Paragon License Agreement”) as a result of exercising its Option under the Paragon Agreement to obtain exclusive licenses to develop, manufacture and commercialize certain therapeutic proteins and antibodies and associated products.
In October 2023, we entered into a License Agreement with Paragon (the “Paragon License Agreement”) as a result of exercising our Option under the Paragon Research Agreement to obtain exclusive licenses to develop, manufacture and commercialize certain therapeutic proteins and antibodies and associated products.
With regard to the transfer of personal data from the EEA to the United States, on July 10, 2023, the EC adopted its adequacy decision for the EU-US Data Privacy Framework. On the basis of the new adequacy decision, personal data can flow from the EEA to U.S. companies participating in the framework.
With regard to the transfer of personal data from the EEA to the United States, on July 10, 2023, the European Commission adopted its adequacy decision for the EU-US Data Privacy Framework. On the basis of the new adequacy decision, personal data can flow from the EEA to U.S. companies participating in the framework.
Across all VRDN-001 treated patients in the active TED trial, 71% were proptosis responders, 67% were overall responders, 62% achieved a clinical activity score (“CAS”) of 0 or 1, and 54% had complete resolution of their diplopia.
Across all veligrotug treated patients in the active TED trial, 71% were proptosis responders, 67% were overall responders, 62% achieved a clinical activity score (“CAS”) of 0 or 1, and 54% had complete resolution of their diplopia.
We currently rely on a single multi-site CDMO for manufacturing our clinical materials, WuXi AppTec (Hong Kong) Limited and WuXi Biologics (Hong Kong) Limited (together, “WuXi”), although other avenues remain available if our current manufacturer were to be negatively impacted.
We currently rely on a single multi-site CDMO for manufacturing our clinical materials, WuXi Biologics (Hong Kong) Limited (“WuXi”), although other avenues remain available if our current manufacturer were to be negatively impacted.
Centralized Authorization Procedure The centralized procedure provides for the grant of a single MA that is issued by the EC, following the scientific assessment of the application by the EMA that is valid for all EU Member States as well as in the three additional EEA Member States.
Centralized Marketing Authorizations The centralized procedure provides for the grant of a single marketing authorization that is issued by the EC, following the scientific assessment of the application by the EMA that is valid for all EU Member States as well as in the three additional EEA Member States.
In December 2022, we recorded $10.0 million as research and development expense related to a milestone owed to ImmunoGen related to the first patient dosed in a pivotal clinical trial for VRDN-001, amount which was paid in January 2023 and which was included in accounts payable in the consolidated balance sheet as of December 31, 2022.
In December 2022, we recorded $10.0 million as research and development expense related to a milestone owed to ImmunoGen related to the first 20 patient dosed in a pivotal clinical trial for veligrotug, amount which was paid in January 2023, and which was included in accounts payable in the consolidated balance sheet as of December 31, 2022.
An updated RMP must be submitted: (i) at the request of EMA or a national competent authority, or (ii) whenever the risk-management system is modified, especially as the result of new information being received that may lead to a significant change to the benefit-risk profile or as a result of an important pharmacovigilance or risk-minimization milestone being reached.
An updated RMP must be submitted: (i) at the request of EMA or a NCA, or (ii) whenever the risk-management system is modified, especially as the result of new information being received that may lead to a significant change to the benefit-risk profile or as a result of an important pharmacovigilance or risk-minimization milestone being reached.
We also conducted Phase 1/2 clinical trials of VRDN-001 in patients with active or chronic TED. In the active TED portion of the Phase 1/2 clinical trials, data reported from all three dose cohorts of VRDN-001 (n=21) showed significant and rapid improvement in both the signs and symptoms of TED after two infusions of VRDN-001 compared to placebo.
We conducted phase 1/2 clinical trials of veligrotug in patients with active or chronic TED. In the active TED portion of the phase 1/2 clinical trials, data reported from all three dose cohorts of veligrotug (n=21) showed significant and rapid improvement in both the signs and symptoms of TED after two infusions of veligrotug compared to placebo.
Our multi-pronged engineering approach has resulted in a portfolio of FcRn-targeting molecules that leverage the clinically and commercially validated mechanism of FcRn inhibition in myasthenia gravis while potentially addressing the limitations of current agents such as incomplete IgG suppression and safety. VRDN-006 and VRDN-008 are both designed to be convenient, self-administered, subcutaneous products.
Our multi-pronged engineering approach has resulted in a portfolio of FcRn-targeting molecules that leverage the clinically and commercially validated mechanism of FcRn inhibition in myasthenia gravis and chronic inflammatory demyelinating polyneuropathy (“CIDP”) while potentially addressing the limitations of current agents such as incomplete IgG suppression and safety. VRDN-006 and VRDN-008 are both designed to be convenient, self-administered, subcutaneous products.
We are evaluating VRDN-001 in two global Phase 3 clinical trials, THRIVE and THRIVE-2, for the treatment of active and chronic TED, respectively. THRIVE and THRIVE-2 are each designed to compare a five-dose intravenous treatment arm of VRDN-001 at 10 mg/kg, dosed three weeks apart, to placebo.
We are evaluating veligrotug in two pivotal global phase 3 clinical trials, THRIVE and THRIVE-2, for the treatment of active and chronic TED, respectively. THRIVE and THRIVE-2 are each designed to compare a five-dose intravenous treatment arm of veligrotug at 10 mg/kg, dosed three weeks apart, to placebo.
The CHMP will provide a positive opinion regarding the application only if it meets certain quality, safety and efficacy requirements. This opinion is then transmitted to the EC, which has the ultimate authority for granting MA within 67 days after receipt of the CHMP opinion.
The CHMP will provide a positive opinion regarding the application only if it meets certain quality, safety and efficacy 32 requirements. This opinion is then transmitted to the EC, which has the ultimate authority for granting marketing authorization within 67 days after receipt of the CHMP opinion.
We have an exclusive license to the worldwide rights to develop and commercialize VRDN-001 for all non-oncology indications that do not use radiopharmaceuticals, including the treatment of patients with TED, from ImmunoGen. The antibody sequence that we are developing as VRDN-001 in TED had previously been developed in oncology as AVE-1642 and studied in over 100 patients.
We have an exclusive license to the worldwide rights to develop and commercialize veligrotug for all non-oncology indications that do not use radiopharmaceuticals, including the treatment of patients with TED, from ImmunoGen, Inc. (“ImmunoGen”). The antibody sequence that we are developing as veligrotug in TED had previously been developed in oncology as AVE-1642 and studied in over 100 patients.
A conditional MA must be renewed annually. Orphan Designation and Exclusivity The criteria for designating an orphan medicinal product in the European Union are similar in principle to those in the United States.
A conditional marketing authorization must be renewed annually. Orphan Designation and Exclusivity The criteria for designating an orphan medicinal product in the European Union are similar in principle to those in the United States.
An orphan medicinal product can also obtain an additional two years of market exclusivity for an orphan-designated condition when the results of specific studies are reflected in the Summary of Product Characteristics, addressing the pediatric population and completed in accordance with a fully compliant Pediatric Investigation Plan.
An orphan medicinal product can benefit from an additional two years of market exclusivity for an orphan-designated condition when the results of specific studies are reflected in the Summary of Product Characteristics, addressing the pediatric population and completed in accordance with a fully compliant Pediatric Investigation Plan.
We offer a package of competitive employee benefits, including 401(k) plan matching contributions and an employee stock purchase plan. We have a performance development review process in which managers provide regular feedback to assist with the development of our employees, including the use of individual plans to assist with career development.
We offer a package of competitive employee benefits, including 401(k) plan matching contributions and an employee stock purchase plan. We have a performance development review process in which managers provide regular feedback to assist with the development of our employees.
Furthermore, there is a growing trend towards the required public disclosure of clinical trial data in the EU, which adds to the complexity of obligations relating to processing health data from clinical trials. Such public disclosure obligations are provided in the new EU Clinical Trials Regulation No.536/2014 (“CTR”), European Medicines Agency (“EMA”) disclosure initiatives and voluntary commitments by industry.
Furthermore, there is a growing trend towards the required public disclosure of clinical trial data in the EU, which adds to the complexity of obligations relating to processing health data from clinical trials. Such public disclosure obligations are provided in the new EU Clinical Trials Regulation No.536/2014 (“CTR”), EMA disclosure initiatives and voluntary commitments by industry.
We expect that the THRIVE and THRIVE-2 Phase 3 trials, together with a safety database comprising 300 treated patients will support global health authority registration for marketing approval in both active and chronic TED, respectively.
We expect that the THRIVE and THRIVE-2 phase 3 trials, together with a safety database comprising 300 treated patients (safety database inclusive of patients from the THRIVE and THRIVE-2 trials), will support global health authority registration for marketing approval in both active and chronic TED.
We, along with third-party contractors, will be required to navigate the various preclinical, clinical and commercial approval requirements of the governing regulatory agencies of the countries in which we wish to conduct studies or seek approval or licensure of our product candidates. U.S.
We, along with third-party contractors, will be required to navigate the various requirements of the governing regulatory agencies of the countries in which we wish to conduct studies or seek approval or licensure of our product candidates. U.S.
For medicinal products containing a new active substance not yet authorized in the EEA before May 20, 2004 and indicated for the treatment of other diseases, medicinal products that constitute significant therapeutic, scientific or technical innovations or for which the grant of a MA through the centralized procedure would be in the interest of public health at EU level, an applicant may voluntarily submit an application for a marketing authorization through the centralized procedure.
For medicinal products containing a new active substance not yet authorized in the EEA before May 20, 2004 and indicated for the treatment of other diseases, medicinal products that constitute significant therapeutic, scientific or technical innovations or for which the grant of a marketing authorization through the centralized procedure would be in the interest of public health at EU level, an applicant may request submission of an marketing authorization through the centralized procedure.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeEvents that may prevent successful or timely completion of clinical development include but are not limited to: • inability to generate satisfactory preclinical, toxicology, or other in vivo or in vitro data or diagnostics to support the initiation or continuation of clinical trials; • delays in reaching agreement on acceptable terms with CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs, clinical trial sites, and in countries or regions where our trials are conducted; • delays in obtaining required approvals from institutional review boards or independent ethics committees at each clinical trial site; • failure to permit the conduct of a clinical trial by regulatory authorities; • delays in recruiting eligible patients and/or subjects in our clinical trials; • failure by clinical sites, CROs, or other third parties to adhere to clinical trial requirements; • failure by our clinical sites, CROs, or other third parties to perform in accordance with current GCP requirements of the FDA or applicable foreign regulatory guidelines; • patients and/or subjects dropping out of our clinical trials; • adverse events or tolerability or animal toxicology issues significant enough in our studies, in studies of third parties, or as reported for marketed products for the FDA or other regulatory agencies to put any or all clinical trials on hold, require us to change how we conduct our IND-enabling studies or our ongoing or future trials, including amending or submitting new clinical protocols or additional safety monitoring or measurements; • occurrence of adverse events associated with our product candidates; • changes in regulatory requirements and guidance that require amending or submitting new clinical protocols; • significant costs of clinical trials of our product candidates, including manufacturing activities; • negative or inconclusive results from our clinical trials or the trials of third parties with related or similar product candidates, which may result in our deciding, or regulators requiring us, to conduct additional clinical trials or abandon development programs in other ongoing or planned indications for a product candidate, or change how we conduct our IND-enabling studies or our ongoing or future trials, including amending or submitting new clinical protocols or additional safety monitoring or measurements; and • delays in reaching agreement on acceptable terms with third-party manufacturers and the time to manufacture sufficient quantities of our product candidates acceptable for use in clinical trials. 41 We are expecting that that the THRIVE and THRIVE-2 Phase 3 clinical trials, together with a safety database comprising 300 treated patients, will support global health authority registration for VRDN-001 IV for marketing approval in both active and chronic TED, respectively.
Biggest changeEvents that may prevent successful or timely completion of clinical development include but are not limited to: • inability to generate satisfactory nonclinical, toxicology, or other in vivo or in vitro data or diagnostics to support the initiation or continuation of clinical trials; • delays in reaching agreement on acceptable terms with CROs and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs, clinical trial sites, and in countries or regions where our trials are conducted; • delays in obtaining required approvals from institutional review boards or independent ethics committees at each clinical trial site; • failure to permit the conduct of a clinical trial by regulatory authorities; • delays in or inability to recruit a sufficient number of eligible patients and/or subjects in our clinical trials; • failure by clinical sites, CROs, or other third parties to adhere to clinical trial requirements or to perform their obligations related to the clinical development of our product candidates; 45 • failure of CDMOs, shipping logistics providers or other third parties to deliver necessary clinical material; • failure by our clinical sites, CROs, or other third parties to perform in accordance with current good clinical practice (“cGCP”), current good laboratory practice (“cGLP”), current good manufacturing practice (“cGMP”) or other applicable requirements of the FDA or applicable foreign regulatory authorities; • patients and/or subjects dropping out of our clinical trials; • adverse events or tolerability or animal toxicology issues significant enough in our studies, in studies of third parties, or as reported for marketed products for the FDA or other regulatory agencies to put any or all clinical trials on hold, require us to change how we conduct our IND-enabling studies or our ongoing or future trials, including amending or submitting new clinical protocols or additional safety monitoring or measurements; • occurrence of adverse events associated with our product candidates; • changes in regulatory requirements or guidance that require amending or submitting new clinical protocols; • geopolitical unrest and adverse regulatory or other actions taken against us, or third parties on whom we relay, by foreign governments or entities, including in Israel and China, where we have current or planned clinical trial operations; • significant costs of clinical trials of our product candidates, including manufacturing activities; • negative or inconclusive results from our clinical trials or the trials of third parties with related or similar product candidates, which may result in our deciding, or regulators requiring us, to conduct additional clinical trials or abandon development programs in other ongoing or planned indications for a product candidate, or change how we conduct our IND-enabling studies or our ongoing or future trials, including amending or submitting new clinical protocols or additional safety monitoring or measurements; and • delays in reaching agreement on acceptable terms with third-party manufacturers and the time to manufacture sufficient quantities of our product candidates acceptable for use in clinical trials.
Some of our product candidates, including VRDN-003, VRDN-006 and VRDN-008, are or are anticipated to be drug-device combination products that will require coordination within the FDA and similar foreign regulatory agencies for review of their device and drug components.
Some of our product candidates, including VRDN-003, VRDN-006 and VRDN-008, are or are anticipated to be combination products that will require coordination within the FDA and similar foreign regulatory agencies for review of their device and drug components.
We do not know whether any clinical trials we may conduct will demonstrate consistent or adequate efficacy and safety of our product candidates, with respect to the proposed indication for use, sufficient to receive regulatory approval to market our drug candidates.
We do not know whether any clinical trials we may conduct will demonstrate consistent or adequate safety and efficacy of our product candidates, with respect to the proposed indication for use, sufficient to receive regulatory approval to market our drug candidates.
Regulation of personal data or personal information processing is evolving, as federal, state, and foreign governments continue to adopt new, or modify existing, laws and regulations addressing data privacy and security, and the collection, processing, storage, transfer, and use of such data.
Regulation of personal information processing is evolving, as federal, state, and foreign governments continue to adopt new, or modify existing, laws and regulations addressing data privacy and security, and the collection, processing, storage, transfer, and use of such data.
Collaborations may pose a number of risks, including: • collaborators often have significant discretion in determining the efforts and resources that they will apply to the collaboration and may not commit sufficient resources to the development, marketing, or commercialization of the product or products that are subject to the collaboration; • collaborators may not perform their obligations as expected; • any such collaboration may significantly limit our share of potential future profits from the associated program and may require us to relinquish potentially valuable rights to our current product candidates, potential products, proprietary technologies, or grant licenses on terms that are not favorable to us; • collaborators may cease to devote resources to the development or commercialization of our product candidates if the collaborators view our product candidates as competitive with their own products or product candidates; • disagreements with collaborators, including disagreements over proprietary rights, contract interpretation, or the course of development, might cause delays or termination of the development or commercialization of product candidates, and might result in legal proceedings, which would be time consuming, distracting, and expensive; • collaborators may be impacted by changes in their strategic focus or available funding, or business combinations involving them, which could cause them to divert resources away from the collaboration; • collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability, which would be time consuming, distracting, and expensive; • the collaborations may not result in us achieving revenue to justify such transactions; and • collaborations may be terminated and, if terminated, may result in a need for us to raise additional capital to pursue further development or commercialization of the applicable product candidate.
Collaborations may pose a number of risks, including: • collaborators often have significant discretion in determining the efforts and resources that they will apply to the collaboration and may not commit sufficient resources to the development, marketing, or commercialization of the product or products that are subject to the collaboration; • collaborators may not perform their obligations as expected; • any such collaboration may significantly limit our share of potential future profits from the associated program and may require us to relinquish potentially valuable rights to our current product candidates, potential products, proprietary technologies, or grant licenses on terms that are not favorable to us; • collaborators may cease to devote resources to the development or commercialization of our product candidates if the collaborators view our product candidates as competitive with their own products or product candidates; • disagreements with collaborators, including disagreements over proprietary rights, contract interpretation, or the course of development, might cause delays or termination of the development or commercialization of product candidates, and might result in legal proceedings, which would be time consuming, distracting, and expensive; • collaborators may be impacted by changes in their strategic focus or available funding, or business combinations involving them, which could cause them to divert resources away from the collaboration; 60 • collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability, which would be time consuming, distracting, and expensive; • the collaborations may not result in us achieving revenue to justify such transactions; and • collaborations may be terminated and, if terminated, may result in a need for us to raise additional capital to pursue further development or commercialization of the applicable product candidate.
Any product liability claim brought against us, with or without merit, could result in: • inability to recruit clinical trial volunteers, investigators, patients or subjects, or trial sites; • withdrawal of clinical trial volunteers, investigators, patients or subjects, or trial sites, or limitations on approved indications; • delay in the development of product candidates; • the inability to commercialize, or if commercialized, decreased demand for, our product candidates; • if commercialized, product recalls, labeling, marketing or promotional restrictions, or the need for product modification; • initiation of investigations by regulators; • loss of revenue; • substantial costs of litigation, including monetary awards to patients or other claimants; • liabilities that substantially exceed our product liability insurance, which we would then be required to pay ourselves; • an increase in our product liability insurance rates or the inability to maintain insurance coverage in the future on acceptable terms, if at all; • the diversion of management’s attention from our business; and • damage to our reputation and the reputation of our products and our technology.
Any product liability claim brought against us, with or without merit, could result in: • inability to recruit clinical trial volunteers, investigators, patients or subjects, or trial sites; • withdrawal of clinical trial volunteers, investigators, patients or subjects, or trial sites, or limitations on approved indications; • delay in the development of product candidates; • the inability to commercialize, or if commercialized, decreased demand for, our product candidates; • if commercialized, product recalls, labeling, marketing or promotional restrictions, or the need for product modification; • initiation of investigations by regulators; • loss of revenue; • substantial costs of litigation, including monetary awards to patients or other claimants; 52 • liabilities that substantially exceed our product liability insurance, which we would then be required to pay ourselves; • an increase in our product liability insurance rates or the inability to maintain insurance coverage in the future on acceptable terms, if at all; • the diversion of management’s attention from our business; and • damage to our reputation and the reputation of our products and our technology.
If we are unable to raise additional capital when required or on acceptable terms, we may be required to: • significantly delay, scale back, or discontinue the development or commercialization of our product candidates; • seek strategic alliances, or amend existing alliances, for research and development programs at an earlier stage than otherwise would be desirable or that we otherwise would have sought to develop independently, or on terms that are less favorable than might otherwise be available in the future; 37 • dispose of technology assets, or relinquish or license on unfavorable terms, our rights to technologies or any of our product candidates that we otherwise would seek to develop or commercialize ourselves; • pursue the sale of our company to a third party at a price that may result in a loss on investment for our stockholders; or • file for bankruptcy or cease operations altogether.
If we are unable to raise additional capital when required or on acceptable terms, we may be required to: • significantly delay, scale back, or discontinue the development or commercialization of our product candidates; • seek strategic alliances, or amend existing alliances, for research and development programs at an earlier stage than otherwise would be desirable or that we otherwise would have sought to develop independently, or on terms that are less favorable than might otherwise be available in the future; • dispose of technology assets, or relinquish or license on unfavorable terms, our rights to technologies or any of our product candidates that we otherwise would seek to develop or commercialize ourselves; • pursue the sale of our company to a third-party at a price that may result in a loss on investment for our stockholders; or • file for bankruptcy or cease operations altogether.
These and other requirements could require us or our collaborators to incur additional costs to achieve compliance, limit our competitiveness, necessitate the acceptance of more onerous obligations in our contracts, restrict our ability to use, store, transfer, and process data, impact our or our collaborators’ ability to process or use data in order to support the provision of our products or services, affect our or our collaborators’ ability to offer our products and services or operate in certain locations, cause regulators to reject, limit, or 59 disrupt our clinical trial activities, result in increased expenses, reduce overall demand for our products and services and make it more difficult to meet expectations of or commitments to customers or collaborators.
These and other requirements could require us or our collaborators to incur additional costs to achieve compliance, limit our competitiveness, necessitate the acceptance of more onerous obligations in our contracts, restrict our ability to use, store, transfer, and process data, impact our or our collaborators’ ability to process or use data in order to support the provision of our products or services, affect our or our collaborators’ ability to offer our products and services or operate in certain locations, cause regulators to reject, limit, or disrupt our clinical trial activities, result in increased expenses, reduce overall demand for our products and services and make it more difficult to meet expectations of or commitments to customers or collaborators.
In addition to threats from natural disasters, telecommunications and electrical failures, traditional computer hackers, malicious code (such as malware, viruses, worms, and ransomware), employee error, theft or misuse, password spraying, phishing, and distributed denial-of-service attacks, we now also face threats from sophisticated nation-state and nation-state supported actors who engage in attacks (including advanced persistent threat intrusions) that add to the risks to our internal networks and systems, our third-party service providers, our collaborators and the information that they store and process.
In addition to threats from natural disasters, telecommunications and electrical failures, traditional computer hackers, malicious code (such as malware, viruses, worms, and ransomware), employee error, theft or misuse, password spraying, phishing, and distributed denial-of-service attacks, we also face threats from sophisticated nation-state and nation-state supported actors who engage in attacks (including advanced persistent threat intrusions) that add to the risks to our internal networks and systems, our third-party service providers, our collaborators and the information that they store and process.
At any time while at least 30% of the originally issued Series A Preferred Stock remains issued and outstanding, we may not consummate a Fundamental Transaction (as defined in the Certificate of Designation of the Series A Preferred Stock) or any merger or consolidation of the Company with or into another entity or any stock sale to, or other business combination in which the stockholders of the Company immediately before such transaction do not hold at least a majority of the capital stock of the Company immediately after such transaction, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series A Preferred Stock.
At any time while at least 30% of the originally issued Series A Convertible Preferred Stock remains issued and outstanding, we may not consummate a Fundamental Transaction (as defined in the Certificate of Designation of the Series A Convertible Preferred Stock) or any merger or consolidation of the Company with or into another entity or any stock sale to, or other business combination in which the stockholders of the Company immediately before such transaction do not hold at least a majority of the capital stock of the Company immediately after such transaction, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series A Convertible Preferred Stock.
While these choice of forum provisions do not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction, the choice of forum provision may limit a 67 stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage such lawsuits against our and our directors, officers, and other employees.
While these choice of forum provisions do not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction, the choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage such lawsuits against our and our directors, officers, and other employees.
If such data are not ultimately comparable to that seen in the earlier trials or earlier in the same trial in terms of safety or efficacy, we may be required to make further changes to our process and/or undertake additional clinical testing, either of which could significantly delay the clinical development or commercialization of the associated product candidate, which would materially adversely affect our business, financial condition, results of operations and growth prospects.
If such data are not ultimately comparable to that seen in the earlier trials or earlier in the same trial in terms of safety or efficacy, we may be required to make further changes to our process and/or undertake additional clinical testing, either of which could significantly delay the clinical development or commercialization of the associated product candidate, which could materially adversely affect our business, financial condition, results of operations and growth prospects.
Although we generally do not expect to begin a clinical trial unless we believe we have a sufficient supply of a product candidate to complete the trial, any significant delay or discontinuity in the supply of a product candidate, or the active ingredient or other material components in the manufacture of the product candidate, could delay completion of our clinical trials and potential timing for regulatory approval of our product candidates, which would harm our business and results of operations.
Although we generally do not expect to begin a clinical trial unless we believe we have a sufficient supply of a product candidate to complete the trial, any significant delay or discontinuity in the supply of a product candidate, or the active ingredient or other material components in the manufacture or administration of the product candidate, could delay completion of our clinical trials and potential timing for regulatory approval of our product candidates, which would harm our business and results of operations.
While we believe that we have made significant progress in 46 remediating these deficiencies, we cannot be assured that our CROs, clinical sites, and other vendors will fully remediate any deficiencies and will meet these requirements on an ongoing basis, or that upon inspection by any regulatory authority, such regulatory authority will determine that efforts, including any of our clinical trials, comply with applicable requirements.
While we believe that we have made significant progress in remediating these deficiencies, we cannot be assured that our CROs, clinical sites, and other vendors will fully remediate any deficiencies and will meet these requirements on an ongoing basis, or that upon inspection by any regulatory authority, such regulatory authority will determine that efforts, including any of our clinical trials, comply with applicable requirements.
In such an event, we may be held liable for any resulting damages and such liability could exceed our resources, and state or federal or other applicable authorities may curtail our use of specified materials and/or interrupt our business operations. Furthermore, environmental laws and regulations are complex, change frequently, and have tended to become more stringent.
In such an event, we may be held liable for any resulting damages and such liability could exceed our resources, and state or federal or other applicable authorities may curtail our use of specified materials and/or interrupt our business operations. Furthermore, environmental laws and regulations are 69 complex, change frequently, and have tended to become more stringent.
If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through strategic collaborations, licensing, or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate.
If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through strategic collaborations, licensing, or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and 51 commercialization rights to such product candidate.
If any patents or patent applications cover our product candidates or technologies, we may not be free to manufacture or market our product candidates as planned, absent such a license, which may not be available to us on commercially reasonable terms, or at all. It is also possible that we have failed to identify relevant third-party patents or applications.
If any patents or patent applications cover our product candidates or technologies, we may not be free to 63 manufacture or market our product candidates as planned, absent such a license, which may not be available to us on commercially reasonable terms, or at all. It is also possible that we have failed to identify relevant third-party patents or applications.
Even if patents covering our product candidates are obtained, once the patent life has expired for a product candidate, we may be open to competition. Patent term extensions (“PTEs”) under the Hatch-Waxman Act in the United States and under supplementary protection certificates in Europe may be available to extend the patent exclusivity terms of our product candidates.
Even if patents covering our product candidates are obtained, once the patent life has expired for a product candidate, we may be open to competition. 61 Patent term extensions (“PTEs”) under the Hatch-Waxman Act in the United States and under supplementary protection certificates in Europe may be available to extend the patent exclusivity terms of our product candidates.
Included in these new procedures is a process known as Inter Partes Review (“IPR”), which has been generally used by many third parties since the enactment of the Leahy-Smith Act to render patents unpatentable. These post-grant review procedures are and continue to be an evolving and developing area of law.
Included in these new procedures is a process known as Inter Partes Review, which has been generally used by many third parties since the enactment of the Leahy-Smith Act to render patents unpatentable. These post-grant review procedures are and continue to be an evolving and developing area of law.
The legal systems of some countries, particularly some developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property protection, particularly those relating to biotechnology and therapeutic products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights generally.
The legal systems of some countries, particularly some developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property protection, particularly those relating to biotechnology and therapeutic 66 products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights generally.
In addition, we rely on our third-party research institution collaborators for conducting research and development of our product candidates, and they may be affected by government shutdowns or withdrawn funding. The occurrence of any of these business disruptions could seriously harm our operations and financial condition and increase our costs and expenses.
In addition, we rely or may rely in the future on our third-party research institution collaborators for conducting research and development of our product candidates, and they may be affected by government shutdowns or withdrawn funding. The occurrence of any of these business disruptions could seriously harm our operations and financial condition and increase our costs and expenses.
Changes in corporate tax rates, the realization of net deferred tax assets relating to our operations, the taxation of foreign earnings, and the deductibility of expenses under the Tax Act or future reform legislation could have a material impact 66 on the value of our deferred tax assets, could result in significant one-time charges, and could increase our future U.S. tax expense.
Changes in corporate tax rates, the realization of net deferred tax assets relating to our operations, the taxation of foreign earnings, and the deductibility of expenses under the Tax Act or future reform legislation could have a material impact on the value of our deferred tax assets, could result in significant one-time charges, and could increase our future U.S. tax expense.
The manufacture of drug products, including combination products that comprise a drug product and a device, is complex and requires significant expertise and capital investment, including the development of advanced manufacturing techniques, process controls and product testing methods. Manufacturers of medical products often encounter difficulties in production, particularly in scaling up and validating initial production and absence of contamination.
The manufacture of drug products, including combination products that comprise a biological drug product and a device, is complex and requires significant expertise and capital investment, including the development of advanced manufacturing techniques, process controls and product testing methods. Manufacturers of medical products often encounter difficulties in production, particularly in scaling up and validating initial production and absence of contamination.
Government actions may also prevent maintenance of issued patents in Russia. These actions could result in abandonment or lapse of patents or patent applications, resulting in partial or complete loss of patent rights in Russia. If such an event were to occur, it could have a material adverse effect on our business.
Government actions may also prevent maintenance of issued patents in Russia. These actions 62 could result in abandonment or lapse of patents or patent applications, resulting in partial or complete loss of patent rights in Russia. If such an event were to occur, it could have a material adverse effect on our business.
As a result, we may experience increased turnover due to employees being overworked. Employees also may be unable to perform these multiple roles effectively due to time and resource constraints. Additionally, if we are unable to retain key personnel, we may be required to cover the roles previously performed by such employees with 63 consultants.
As a result, we may experience increased turnover due to employees being overworked. Employees also may be unable to perform these multiple roles effectively due to time and resource constraints. Additionally, if we are unable to retain key personnel, we may be required to cover the roles previously performed by such employees with consultants.
Even after an orphan drug is approved, the FDA can subsequently approve the same drug with the same active moiety for the same condition if the FDA concludes that the later drug is clinically superior in that it is safer, more effective, or makes a major contribution to patient care.
Additionally, even after an orphan drug is approved, the FDA can subsequently approve the same drug with the same active moiety for the same condition if the FDA concludes that the later drug is clinically superior in that it is safer, more effective, or makes a major contribution to patient care.
To successfully commercialize any products that may result from our development programs, we will need to find one or more collaborators to commercialize our products or invest in and develop these capabilities, either on our own or with others, which would be expensive, difficult, and time consuming.
To successfully commercialize any products that may result from our development programs, we may need to find one or more collaborators to commercialize our products or invest in and develop these capabilities, either on our own or with others, which would be expensive, difficult, and time consuming.
Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld material information from the USPTO, or made a misleading statement, during prosecution. The outcome following legal assertions of invalidity, unenforceability, and patentability is unpredictable.
Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld material information from the USPTO, or made a 65 misleading statement, during prosecution. The outcome following legal assertions of invalidity, unenforceability, and patentability is unpredictable.
Further, even if we obtain orphan drug exclusivity for an existing or future product candidate, that exclusivity may not 56 effectively protect the product from competition because different drugs with different active moieties still can be approved for the same condition even with an orphan drug designation.
Further, even if we obtain orphan drug exclusivity for an existing or future product candidate, that exclusivity may not effectively protect the product from competition because different drugs with different active moieties still can be approved for the same condition even with an orphan drug designation.
In addition, we do not currently have, nor do we currently plan to establish, the capability to manufacture product candidates for use in the conduct of our clinical trials, and we lack the resources and the capability to manufacture any of our product candidates on a clinical or commercial scale without the use of third-party manufacturers.
We do not currently have, nor do we currently plan to establish, the capability to manufacture product candidates for use in the conduct of our clinical trials, and we lack the resources and the capability to manufacture any of our product candidates on a clinical or commercial scale without the use of third-party manufacturers.
There is no way to know if we will be able to 45 continue to obtain product liability coverage and obtain expanded coverage, if we require it, in sufficient amounts to protect us against losses due to liability, on acceptable terms, or at all.
There is no way to know if we will be able to continue to obtain product liability coverage and obtain expanded coverage, if we require it, in sufficient amounts to protect us against losses due to liability, on acceptable terms, or at all.
There are expected to be a limited number of suppliers for the active ingredients and other materials, including devices and device components, that we expect to use to manufacture and deliver our product candidates, including those of our product candidates that are anticipated to be drug-device combination products.
There are expected to be a limited number of suppliers for the active ingredients and other materials, including devices and device components, that we expect to use to manufacture and deliver our product candidates, including those of our product candidates that are anticipated to be combination products.
Additionally, our manufacturers may experience manufacturing difficulties due to resource constraints or as a result of labor disputes, shortages, including from the effects of heath emergencies (such as novel viruses or pandemics) and natural disasters, or unstable political environments.
Additionally, our manufacturers may experience manufacturing difficulties due to resource constraints or as a result of labor disputes, shortages, including from the effects of heath emergencies (such as novel viruses or pandemics), natural disasters, or unstable political environments.
We will be required to report adverse reactions and production problems, if any, to the FDA, EMA, and comparable foreign regulatory authorities. Any new legislation could result in delays in product development or commercialization, or increased costs to assure compliance.
We will be required to report adverse reactions and production problems, if any, to the FDA, EMA, and any relevant comparable foreign regulatory authorities. Any new legislation could result in delays in product development or commercialization, or increased costs to assure compliance.
In addition, if we make manufacturing or formulation changes to our product candidates, we may need to conduct additional clinical or nonclinical studies and the results obtained from studying such new formulation may not be consistent with previous results obtained.
In addition, if we make manufacturing or formulation changes to our product candidates, we may need to conduct additional clinical or nonclinical studies and the results obtained, including from studying such new formulation may not be consistent with previous results obtained.
In addition, the failure of our systems, maintenance problems, upgrading or transitioning to new platforms, or a breach in security could result in delays and reduce efficiency in our operations. Remediation of such problems could result in significant, unplanned capital investments.
In addition, the failure of our systems, maintenance problems, upgrading or 73 transitioning to new platforms, or a breach in security could result in delays and reduce efficiency in our operations. Remediation of such problems could result in significant, unplanned capital investments.
We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and the rules and regulations of Nasdaq. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures 69 and internal control over financial reporting.
We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and the rules and regulations of Nasdaq. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting.
We may not be able to identify alternative suppliers to prevent a possible disruption of the manufacture of our product candidates for our clinical trials, and, if approved, ultimately for commercial sale.
We 56 may not be able to identify alternative suppliers to prevent a possible disruption of the manufacture of our product candidates for our clinical trials, and, if approved, ultimately for commercial sale.
Our ability to execute our business plan and maintain operations depends on the continued and uninterrupted performance of our information technology (“IT”) systems or those of third parties upon whom we rely.
Our ability to execute our business plan and maintain operations depends on the continued and uninterrupted performance of our information technology (“IT”) systems and those of third parties upon whom we rely.
Larger scale clinical trials for our product candidates may generate additional data that raise issues regarding the safety and efficacy of our product candidates that were not observed in smaller clinical trials.
Larger scale clinical trials for our product candidates may generate additional data that raise issues regarding the safety and efficacy of 50 our product candidates that were not observed in smaller clinical trials.
This, in turn, could require notification under applicable data privacy regulations or contracts, and could lead to litigation, governmental audits, investigations, fines, penalties, and other possible liability, damage our relationships with our collaborators, trigger indemnification and other contractual obligations, cause us to incur investigation, mitigation and remediation expenses, have a negative impact on our ability to conduct clinical trials, and cause reputational damage.
This, in turn, could require notification under applicable data privacy regulations or contracts, and could lead to financial losses, litigation, governmental audits, investigations, fines, penalties, and other possible liability, damage our relationships with our collaborators, trigger indemnification and other contractual obligations, cause us to incur investigation, mitigation and remediation expenses, have a negative impact on our ability to conduct clinical trials, and cause reputational damage.
Even if one or more of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, potentially significant negative consequences could result, including but not limited to: • regulatory authorities may withdraw approvals of such products; • regulatory authorities may require additional warnings on the drug label; • we may be required to create a REMS, which could include a medication guide outlining the risks of such side effects for distribution to patients, a communication plan for healthcare providers, and/or other elements to assure safe use; 42 • we could be sued and held liable for harm caused to patients or subjects; and • our reputation may suffer.
Even if one or more of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, potentially significant negative consequences could result, including but not limited to: • regulatory authorities may withdraw approvals of such products; • regulatory authorities may require additional warnings on the drug labeling; • we may be required to create a REMS, which could include a medication guide outlining the risks of such side effects for distribution to patients, a communication plan for healthcare providers, and/or other elements to assure safe use; • we could be sued and held liable for harm caused to patients or subjects; and • our reputation may suffer.
If we choose to pursue accelerated approval, there can be no assurance that the FDA will agree that our proposed primary endpoint is an appropriate surrogate 57 endpoint.
If we choose to pursue accelerated approval, there can be no assurance that the FDA will agree that our proposed primary endpoint is an appropriate surrogate endpoint.
Our ability to raise additional funds will depend, in part, on the success of our preclinical studies and clinical trials and other product development activities, regulatory events, our ability to identify and enter into licensing or other strategic arrangements, and other events or conditions that may affect our value or prospects, as well as factors related to financial, economic and market conditions, many of which are beyond our control.
Our ability to raise additional funds will depend, in part, on the success of our nonclinical studies and clinical trials and other product development activities, regulatory events, our ability to identify and enter into licensing or other strategic arrangements, and other events or conditions that may affect our value or prospects, as well as factors related to financial, economic and market conditions, many of which are beyond our control.
In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as 55 federal and state laws in the United States.
In addition, the laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States.
Any of these events could prevent us from achieving or maintaining market acceptance of a product candidate, even if approved, and could significantly harm our business, results of operations, and prospects. Additional time may be required to obtain marketing authorizations for certain of our product candidates because they are, or are anticipated to be, drug-device combination products.
Any of these events could prevent us from achieving or maintaining market acceptance of a product candidate, even if approved, and could significantly harm our business, results of operations, and prospects. Additional time may be required to obtain marketing authorizations for certain of our product candidates because they are, or are anticipated to be, combination products.
If these third parties do not successfully perform and comply with regulatory requirements, we may not be able to successfully complete clinical development, obtain regulatory approval, or commercialize our product candidates and our business could be substantially harmed. We have relied upon and plan to continue to rely upon third-party CROs to conduct, monitor, and manage preclinical and clinical programs.
If these third parties do not successfully perform and comply with regulatory requirements, we may not be able to successfully complete clinical development, obtain regulatory approval, or commercialize our product candidates and our business could be substantially harmed. We have relied upon and plan to continue to rely upon third-party CROs to conduct, monitor, and manage nonclinical and clinical programs.
Any such volatility and disruptions may adversely affect our business or the third parties on whom we rely. If the equity and credit markets deteriorate, including as a result of political unrest or war, it may make any necessary debt or equity financing more difficult to complete, more costly, and more dilutive.
Any such volatility and disruptions may adversely affect our clinical trials, our business and the third parties on whom we rely. If the equity and credit markets deteriorate, including as a result of political unrest or war, it may make any necessary debt or equity financing more difficult to complete, more costly, and more dilutive.
We believe that our current cash, cash equivalents and short-term investments will be sufficient to fund our operations, including our clinical development plan described elsewhere in this Annual Report, into the second half of 2026. We will need to raise additional capital to continue to fund our operations and service our obligations in the future.
We believe that our current cash, cash equivalents and short-term investments will be sufficient to fund our operations, including our clinical development plan described elsewhere in this Annual Report, into the second half of 2027. We will need to raise additional capital to continue to fund our operations and service our obligations in the future.
Any failure or perceived failure by us or our employees, representatives, contractors, consultants, collaborators, or other third-party service providers to comply with our data privacy, security, protection, or confidentiality, or to respond to any data security incidents, breaches or other unauthorized access, acquisition, or disclosure of sensitive information (including, without limitation personal information), may result in additional cost and/or liability to us, including costs from governmental investigations, enforcement actions, regulatory fines, litigation, costs of doing business, or damage to our reputation.
Any failure or perceived failure by us or our employees, representatives, contractors, consultants, collaborators, or other third-party service providers to comply with our data privacy, security, protection, or confidentiality obligations, or to respond to any data security incidents, breaches or other unauthorized access, acquisition, or disclosure of sensitive information (including, without limitation personal information), may result in financial losses, additional cost and/or liability to us, including costs from governmental investigations, enforcement actions, regulatory fines, litigation, costs of doing business, or damage to our reputation.
Our most recent analysis of possible ownership changes was completed for certain tax periods ending through December 31, 2023. It is possible that we have in the past undergone and may in the future undergo, additional ownership changes that could result in additional limitations on our NOL and tax credit carryforwards.
Our most recent analysis of possible ownership changes was completed for certain tax periods ending through December 31, 2024. It is possible that we have in the past undergone and may in the future undergo, additional ownership changes that could result in additional limitations on our NOL and tax credit carryforwards.
Additionally, regional disruptions, including natural disasters or health emergencies (such as novel viruses or pandemics), could significantly disrupt the timing of clinical trials. CROs may also involve higher costs than anticipated, which could negatively affect our financial condition and operations.
Additionally, regional disruptions, including natural disasters, geopolitical unrest, or health emergencies (such as novel viruses or pandemics), could significantly disrupt the timing of clinical trials. CROs may also involve higher costs than anticipated, which could negatively affect our financial condition and operations.
Shortages and governmental restrictions resulting from pandemics or other public health crises may disrupt the ability of or increase the cost for our clinical trial sites and other CROs to procure items that are essential for our research and development activities, including animals that are used for preclinical studies.
Shortages and governmental restrictions resulting from pandemics or other public health crises may disrupt the ability of or increase the cost for our clinical trial sites and other CROs to procure items that are essential for our research and development activities, including animals that are used for nonclinical studies.
The FDA’s longstanding interpretation of the Orphan Drug Act is that exclusivity is specific to the orphan indication for which the drug was actually approved.
For example, the FDA’s longstanding interpretation of the Orphan Drug Act is that exclusivity is specific to the orphan indication for which the drug was actually approved.
Clinical trials by their nature utilize a sample of the potential patient population. However, with a limited number of subjects and limited duration of exposure, we cannot be fully assured that rare and severe side effects of our product candidates will be uncovered.
Clinical trials by their nature utilize a sample of the potential patient population. But, with a limited number of subjects and limited duration of exposure, we cannot be fully assured that rare and severe side effects of our product candidates will be uncovered.
Other potential consequences include, among other things: • restrictions on the marketing or manufacturing of a product, complete withdrawal of the product from the market, or product recalls; • fines, warning letters, or holds on post-approval clinical studies; • refusal of the FDA to approve pending applications or supplements to approved applications, or suspension or revocation of existing product approvals; • product seizure or detention, or refusal of the FDA to permit the import or export of products; or • injunctions or the imposition of civil or criminal penalties.
Other potential consequences include, among other things: • restrictions on the marketing or manufacturing of a product, complete withdrawal of the product from the market, or product recalls; • fines, warning letters, or holds on post-approval clinical studies; 46 • refusal of the FDA or other regulatory authorities to approve pending applications or supplements to approved applications, or suspension or revocation of existing product approvals; • product seizure or detention, or refusal of the FDA or other regulatory authorities to permit the import or export of products; or • injunctions or the imposition of civil or criminal penalties.
Any delay or interruption in the supply of clinical trial supplies could delay the completion of clinical trials, increase the costs associated with maintaining clinical trial programs and, depending upon the period of delay, require us to commence new clinical trials at additional expense or terminate clinical trials completely.
Any delay or interruption in the supply of clinical trial supplies could delay the initiation or completion of clinical trials, increase the costs associated with initiating or maintaining clinical trial programs and, depending upon the period of delay, require us to commence new clinical trials at additional expense or terminate clinical trials completely.
Many of our competitors have substantially greater financial, technical, and other resources, such as larger research and development staff and experienced marketing and manufacturing organizations. Third-party payors, including governmental and private insurers, may also encourage the use of generic products. For example, if VRDN-001 is approved, it may be priced at a significant premium over other competitive products.
Many of our competitors have substantially greater financial, technical, and other resources, such as larger research and development staff and experienced marketing and manufacturing organizations. Third-party payors, including governmental and private insurers, may also encourage the use of generic products. For example, if veligrotug is approved, it may be priced at a significant premium over other competitive products.
These problems may be more likely, or worse, in cases where the products candidates being manufactured are drug-device combination products, like certain of our product candidates, due to the increased complexity in their manufacture and associated supply chain.
These problems may be more likely, or worse, in cases where the products candidates being manufactured are combination products, like certain of our product candidates, due to the increased complexity in their manufacture and associated supply chain.
If granted, accelerated approval may be contingent on the sponsor’s agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to verify and describe the drug’s predicted effect on irreversible morbidity or mortality or other clinical benefit.
If granted, accelerated approval may be contingent on the applicant’s agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to verify and describe the drug’s predicted effect on irreversible morbidity or mortality or other clinical benefit.
This may make it difficult for VRDN-001 or any other future products to compete with these products. If our competitors obtain marketing approval from the FDA, EMA, or comparable foreign regulatory authorities for their product candidates more rapidly than us, it could result in our competitors establishing a strong market position before we are able to enter the market.
This may make it difficult for veligrotug or any other future products to compete with these products. If our competitors obtain marketing approval from the FDA, EMA, or comparable foreign regulatory authorities for their product candidates more rapidly than us, it could result in our competitors establishing a strong market position before we are able to enter the market.
This creates a risk that the final results could be materially different from the preliminary results reported to date. Additionally, differences in patient populations across our clinical trials may lead to inconsistent or unrepresentative data.
This creates a risk that the final results could be materially different from the preliminary results reported, including those reported to date. Additionally, differences in patient populations across our clinical trials may lead to inconsistent or unrepresentative data.
We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future and our expenses will increase substantially if and as we: • continue the development of our product candidates; • continue efforts to discover and develop new product candidates; 38 • continue the manufacturing of our product candidates or increase volumes manufactured by third parties; • continue to advance our programs into large, expensive clinical trials; • initiate additional preclinical studies or clinical trials for our product candidates; • seek regulatory and marketing approvals and reimbursement for our product candidates; • establish a sales, marketing, and distribution infrastructure to commercialize any products for which we may obtain marketing approval and market for ourselves; • seek to identify, assess, acquire, and/or develop other product candidates; • make milestone, royalty, or other payments under third-party license agreements or enter into additional third-party license agreements; • seek to maintain, protect, and expand our intellectual property portfolio; • seek to attract and retain skilled personnel; and • experience any delays or encounter issues with the development and potential for regulatory approval of our clinical and product candidates such as safety issues, manufacturing delays, clinical trial accrual delays, longer follow-up for planned studies or trials, additional major studies or trials, or supportive trials necessary to support marketing approval.
We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future and our expenses will increase substantially if and as we: • continue the development of our product candidates; • continue efforts to discover and develop new product candidates; • continue the manufacturing of our product candidates or increase volumes manufactured by third parties; • continue to advance our programs into large, expensive clinical trials; • initiate additional nonclinical studies or clinical trials for our product candidates; • seek regulatory and marketing approvals, pricing, and reimbursement for our product candidates; 42 • establish a sales, marketing, and supply chain and distribution infrastructure to commercialize any products for which we may obtain marketing approval and market for ourselves; • seek to identify, assess, acquire, and/or develop other product candidates; • make milestone, royalty, or other payments under third-party license agreements or enter into additional third-party license agreements; • seek to maintain, protect, and expand our intellectual property portfolio; • seek to attract and retain skilled personnel; and • experience any delays or encounter issues with the development and potential for regulatory approval of our clinical and product candidates such as safety issues, manufacturing delays, clinical trial accrual delays, longer follow-up for planned studies or trials, additional major studies or trials, or supportive trials necessary to support marketing approval.
In addition to the factors described elsewhere in this “Risk Factors,” some of the factors that may cause the market price of our common stock to fluctuate greatly, and to decline significantly, include: • failure to meet or exceed financial and development projections we may provide to the public and the investment community; • negative outcomes, or perceived negative outcomes, from our interactions with regulatory authorities in connection with the development of our product candidates; • the perception of the pharmaceutical and biotechnology industries by the public, legislatures, regulators, and the investment community; 68 • announcements of significant acquisitions, strategic collaborations, joint ventures, or capital commitments by us or our competitors; • significant lawsuits, including patent or stockholder litigation; • if securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our business and stock; • changes in the market valuations of similar companies; • changes in the possible market size, or perceived market size, for our product candidates; • announcements by commercial partners or competitors of new commercial products, clinical progress or the lack thereof, significant contracts, commercial relationships, or capital commitments; • the introduction of technological innovations or new therapies that compete with our potential products; • changes in the structure of health care payment systems; and • period-to-period fluctuations in our financial results.
In addition to the factors described elsewhere in this “Risk Factors,” some of the factors that may cause the market price of our common stock to fluctuate greatly, and to decline significantly, include: • failure to meet or exceed financial and development projections we may provide to the public and the investment community; • failure of investors to view the clinical trial data that we generate favorably, even if we view the data favorably; • negative outcomes, or perceived negative outcomes, from our interactions with regulatory authorities in connection with the development of our product candidates; • the perception of the pharmaceutical and biotechnology industries by the public, legislatures, regulators, and the investment community; • announcements of significant acquisitions, strategic collaborations, joint ventures, or capital commitments by us or our competitors; • significant lawsuits, including patent or stockholder litigation; • if securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our business and stock; • changes in the market valuations of similar companies; • changes in the possible market size, or perceived market size, for our product candidates; • announcements by commercial partners or competitors of new commercial products, clinical progress or the lack thereof, significant contracts, commercial relationships, or capital commitments; • the introduction of technological innovations or new therapies that compete with our potential products; • changes in the structure of health-care payment systems; and • period-to-period fluctuations in our financial results.
In addition, security incidents or breaches affecting us or our current or future collaborators or third-party service providers could result in the unauthorized access to, or disclosure or loss of the information we process.
In addition, security incidents or breaches affecting us or our current or future collaborators or third-party service providers could result in the unauthorized access to, or disclosure or loss of information, including information that we process.
In 43 addition, from time to time, we may publicly disclose interim, topline, or preliminary data from our preclinical studies and clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change as more patient data become available.
In addition, from time to time, we may publicly disclose interim, topline, or preliminary data from our nonclinical studies and clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change as more patient data become available.
As our development and commercialization plans and strategies develop, we expect to need additional managerial, operational, sales, marketing, financial, legal, and other resources. Our management may need to divert a disproportionate amount of our attention away from our day-to-day activities and devote a substantial amount of time to managing these growth activities.
As our development and commercialization plans and strategies develop and our geographical footprint expands, we expect to need additional managerial, operational, sales, marketing, financial, legal, and other resources. Our management may need to divert a disproportionate amount of our attention away from our day-to-day activities and devote a substantial amount of time to managing these growth activities.
To the extent that we raise additional capital through the sale of equity securities or convertible debt securities, the ownership interest of our stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a stockholder.
To the extent that we raise additional capital through the sale of equity securities or convertible debt securities, or other non-dilutive sources of capital, the ownership interest of our stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a stockholder.
Third-party claims of intellectual property infringement may prevent or delay our development and commercialization efforts. Our commercial success depends in part on our ability to develop, manufacture, market, and sell our product candidates and use our proprietary technology without infringing the patent rights of third parties.
Third-party claims of intellectual property infringement may prevent or delay our development and commercialization efforts. Our commercial success depends in part on our ability to develop, manufacture, market, and sell our product candidates and use our proprietary technology without infringing the intellectual property or other exclusive rights of third parties.
Our product candidates may cause undesirable side effects or have other properties that could delay or prevent their regulatory approval, limit the commercial viability of an approved label, or result in significant negative consequences following marketing approval, if any.
Our product candidates may cause undesirable side effects or have other properties that could delay or prevent their regulatory approval, limit the commercial viability of approved labeling, or result in significant negative consequences following marketing approval, if any.
Such side effects additionally may result in a delay of regulatory approval by the FDA, EMA, or comparable foreign authorities, or, even in the instance that an affected product candidate is approved, may result in a restrictive drug label.
Such side effects additionally may result in a delay or denial of regulatory approval by the FDA, EMA, or comparable foreign authorities, or, even in the instance that an affected product candidate is approved, may result in restrictive drug labeling.
Topline or preliminary data from our clinical trials that we announce or publish from time to time, including the data from our Phase 1 study in healthy volunteers and the masked data for VRDN-001 from our ongoing trials, may change as more patient data become available, and we become subject to audit and verification procedures that could result in material changes in the final data.
Topline or preliminary data from our clinical trials that we announce or publish from time to time, including the data from our phase 1 study in healthy volunteers, the data for veligrotug from our ongoing trials, and topline data may change as more patient data become available and we become subject to audit and verification procedures that could result in material changes in the final data.
We currently rely on outside vendors to manufacture our clinical supplies of our product candidates and plan to continue relying on third parties to manufacture our product candidates, devices, or device components on a commercial scale, if approved. In particular, we rely upon single-sourced manufacturing with one CMO for our drug product.
We currently rely on outside vendors to manufacture our clinical supplies of our product candidates and plan to continue relying on third parties to manufacture our product candidates, devices, or device components on a commercial scale, if approved. In particular, we rely upon single-sourced manufacturing with one CDMO for manufacturing our product candidates, including drug substance and drug product.
Evolving changes in China’s public health, economic, political, and social conditions and the uncertainty around China’s relationship with other governments, such as the United States and the U.K., could also negatively impact our ability to use 49 Chinese companies to manufacture our product candidates for our clinical trials or have an adverse effect on our ability to secure commitments from governments to purchase our potential therapies, which could cause us to delay our clinical development programs or adversely affect our financial condition.
Evolving changes in China’s economic, political, and social conditions and the uncertainty around China’s relationship with other governments, such as the U.S. and the U.K., could also negatively impact our ability to use Chinese companies to manufacture our product candidates for our clinical trials or have an adverse effect on our ability to secure commitments from governments to purchase our potential therapies, which could cause us to delay our clinical development programs or adversely affect our financial condition.
As of December 31, 2023, a majority of the then outstanding shares of Series A Preferred Stock was held by entities affiliated with one stockholder. This provision of the Certificate of Designation may make it more difficult for us to enter into any of the aforementioned transactions.
As of December 31, 2024, a 75 majority of the then outstanding shares of Series A Convertible Preferred Stock was held by entities affiliated with one stockholder. This provision of the Certificate of Designation may make it more difficult for us to enter into any of the aforementioned transactions.
In addition, the USPTO continues to provide updates to its guidance continues to be a developing area. The USPTO guidance may make it impossible for us to obtain similar patent claims in future patent applications. Currently, our patent portfolio contains claims of various types and scope, including methods of medical treatment.
In addition, the USPTO continues to provide updates to its guidance. The USPTO guidance may make it impossible for us to obtain similar patent claims in future patent applications. Currently, our patent portfolio contains claims of various types and scope, including methods of medical treatment.
Although we have product liability insurance, which covers our historical clinical trials in the United States, for up to $10.0 million per occurrence, up to an aggregate limit of $10.0 million, our insurance may be insufficient to reimburse us for any expenses or losses we may suffer.
Although we have product liability insurance, which covers our historical clinical trials, for up to $10.0 million per occurrence, up to an aggregate limit of $10.0 million, our insurance may be insufficient to reimburse us for any expenses or losses we may suffer.
Although some of our employees may have been employed at companies that have launched pharmaceutical products in the past, we have no experience establishing commercial manufacturing relationships for or selling and marketing our product candidates and we currently have no commercial manufacturing relationships or marketing or sales organization.
Although some of our employees may have been employed at companies that have launched pharmaceutical products in the past, we have no experience establishing commercial manufacturing relationships for or selling and marketing our product candidates and we are currently building our commercial manufacturing relationships, marketing, and sales organizations.
For example, hearing impairment observed in Tepezza®, or other negative side effects of other IGF-1R antagonists in development, may negatively affect clinical trials for our product candidates, delay regulatory approval or result in a restrictive drug label, if approved.
For example, hearing impairment observed in Tepezza, or other negative side effects of other IGF-1R antagonists 49 in development, may negatively affect clinical trials for our product candidates, delay regulatory approval or result in restrictive drug labeling, if approved.
In addition, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporate Law, which prohibits stockholders owning in excess of 15% of our outstanding voting stock from merging or combining with us.
In addition, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporate Law, which prohibits stockholders owning in excess of 15% of our outstanding voting stock from merging or combining with us, unless certain conditions are met.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn the last fiscal year, we have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected us, but we face certain ongoing cybersecurity risks threats that, if realized, are reasonably likely to materially affect us. See “Risk Factors” for additional information on cybersecurity risks we face.
Biggest changeIn the last fiscal year, we have not experienced any cybersecurity incidents that resulted in a material effect on our business strategy, results of operations, or financial condition, but we cannot provide assurance that we will not be materially affected in the future by such risks or any future material incidents See “Risk Factors” for additional information on cybersecurity risks we face.
Our Vice President, Digital Operations & Facilities, who reports directly to the Chief Operating Officer and has over 12 years of experience managing information technology and cybersecurity matters, together with our senior leadership team, is responsible for assessing and managing cybersecurity risks.
Our Vice President, Information Technology & Facilities, who reports directly to the Chief Operating Officer and has over 15 years of experience managing information technology and cybersecurity matters, together with our senior leadership team, is responsible for assessing and managing cybersecurity risks.
These processes are managed and monitored by our information technology team, which is led by our Vice President, Digital Operations & Facilities, and include mechanisms, controls, technologies, systems, and other processes designed to prevent or mitigate data loss, theft, misuse, or other security incidents or vulnerabilities affecting the data and maintain a stable information technology environment.
These processes are managed and monitored by our information technology team, which is led by our Vice President, Information Technology & Facilities, and include mechanisms, controls, technologies, systems, and other processes designed to prevent or mitigate data loss, theft, misuse, or other security incidents or vulnerabilities affecting our data and information technology environment.
The Audit Committee receives biannual updates on cybersecurity and information technology matters and related risk exposures from our Chief Operating Officer as well as other members of the senior leadership team. The Board also receives updates from management and the Audit Committee on cybersecurity risks on at least an annual basis.
Our Audit Committee has been designated by our Board to oversee cybersecurity risks. The Audit Committee receives biannual updates on cybersecurity and information technology matters and related risk exposures from members of the senior leadership team. The Board also receives updates from management and the Audit Committee on cybersecurity risks on at least an annual basis. 79
To this end, we have implemented processes designed to assess, identify, and 70 manage risks from potential unauthorized occurrences on or through our information technology systems that may result in adverse effects on the confidentiality, integrity, and availability of these systems and the data residing therein.
ITEM 1C. CYBERSECURITY We have developed and implemented a cybersecurity risk management program that is designed to assess, identify, and manage material risks from cybersecurity threats and to protect the security, confidentiality, integrity and availability of our critical systems and information.
Removed
ITEM 1C. CYBERSECURITY In the ordinary course of our business, we collect, use, store, and transmit digitally confidential, sensitive, proprietary, personal, and health-related information. The secure maintenance of this information and our information technology systems is important to our operations and business strategy.
Removed
Our board of directors, as a whole and at the Audit Committee level, has oversight for the most significant risks facing us and for our processes to identify, prioritize, assess, manage, and mitigate those risks. Our Audit Committee, which is comprised solely of independent directors, has been designated by our Board to oversee cybersecurity risks.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAdditionally, we lease approximately 27,128 sq. ft. of office and laboratory space in Boulder, Colorado under a lease that expires in December 2024, subject to two three-year renewal options prior to the expiration, and that includes rent escalation clauses through the lease term.
Biggest changeThe Fifth Amendment makes certain modifications to both the Massachusetts Lease and the Fourth Amendment, including the addition of 2,788 sq. ft. of office space in the same building (the “September 2024 Expansion Premises”). Additionally, we leased approximately 27,128 sq. ft. of office and laboratory space in Boulder, Colorado under a lease that expired in December 2024.
Under the Second Amendment, we have the option to extend the lease term for an additional period of three years upon notice to the landlord. In July 2022, we entered into a third amendment to the Original Lease (the “Third Amendment”).
Under the Fourth Amendment, we have the option to extend the lease term for an additional period of three years upon notice to the landlord. In September 2024, we entered into a fifth amendment to the Massachusetts Lease (the “Fifth Amendment”).
ITEM 2. PROPERTIES We are party to a multi-year, non-cancelable lease agreement for our office space in Waltham, Massachusetts (the “Original Lease”). In July 2021, we entered into an amendment to the Original Lease to increase our Massachusetts-based office space (the “First Amendment”). In April 2022, we entered into a second amendment to the Original Lease (the “Second Amendment”).
ITEM 2. PROPERTIES We are party to a multi-year, non-cancelable lease agreement for our office space in Waltham, Massachusetts (as subsequently amended in July 2021, April 2022, July 2022, and April 2024, the “Massachusetts Lease”). In April 2024, we entered into a fourth amendment to the Massachusetts Lease (the “Fourth Amendment”).
The Third Amendment makes certain modifications to the Original Lease, including (i) the addition of 5,240 square feet of office space in the same building (the “July 2022 Expansion Premises”), (ii) the termination of the 1,087 square feet of leased space under the Original Lease, and (iii) the extension of the expiration date of the 3,284 square feet of leased space under the First Amendment to April 2027.
The Fourth Amendment makes certain modifications to the Massachusetts Lease, including (i) securing 10,427 sq. ft. of office space in the same building (the “New Premises”), (ii) the termination of the 10,956 sq. ft. of leased space under the Massachusetts Lease (the “Original Premises”), and (iii) the extension of the expiration date of the New Premises to July 2029.
Under the Third Amendment, we have the option to extend the lease term for an additional period of three years upon notice to the landlord.
In September 2024, we entered into a new, multi-year lease agreement for 7,117 sq. ft. of office and laboratory space in Boulder, Colorado that expires in December 2026. We have the option to extend the lease term for an additional period of five years upon notice to the Landlord.
Removed
The Second Amendment made certain modifications to both the Original Lease and First Amendment, including (i) the addition of 2,432 square feet of office space in the same building (the “April 2022 Expansion Premises”), (ii) the termination of the 1,087 square feet of leased space under the Original Lease seven days after the delivery of the April 2022 Expansion Premises, which occurred in the fourth quarter of 2022, and (iii) the extension of the expiration date of the 3,284 square feet of leased space under the First Amendment from October 2024 through November 2026.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS From time to time, we may be involved in legal proceedings in the ordinary course of business. We are currently not a party to any legal proceedings that we believe would have a material adverse effect on our business, financial condition, or results of operations. 71 ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 72 PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS From time to time, we may be involved in legal proceedings in the ordinary course of business. We are currently not a party to any legal proceedings that we believe would have a material adverse effect on our business, financial condition, or results of operations. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 80 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on The Nasdaq Capital Market under the symbol “VRDN.” Holders As of February 22, 2024, we had 31 registered holders of record of our common stock.
Biggest changeITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on The Nasdaq Capital Market under the symbol “VRDN.” Holders As of February 20, 2025, we had 14 registered holders of record of our common stock.

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe $58.9 million increase in research and development expenses is primarily attributable to the following: • $20.4 million increase in clinical trial costs mainly due to expenses associated with our THRIVE and THRIVE-2 clinical trials; • $19.0 million increase in personnel related costs, including share-based compensation, due to an increase in headcount; • $8.0 million increase in milestone, license and option fees due to the $15.0 million upfront payment for development of SC delivery systems, issuance of the equivalent of $5.7 million in shares of our common stock for an exclusive license and collaboration agreement, and a $5.3 million upfront payment for an exclusive license agreement during the year ended December 31, 2023, offset by upfront payments of $4.7 million for certain agreed upon development activities and the $13.0 million milestone payments for clinical trial activities for VRDN-001 during the year ended December 31, 2022; • $5.1 million increase in professional service fees for consultants and contractors to support ongoing programs; and • $3.6 million increase in chemistry, manufacturing and controls costs for our ongoing and planned clinical trials, SC development costs for VRDN-001, as well as IND-enabling activities for VRDN-003.
Biggest changeDirect costs related to the FcRn inhibitor portfolio increased by $12.0 million during the year ended December 31, 2024 compared to the year ended December 31, 2023, primarily attributable to: • $14.0 million increase in nonclinical research to advance the FcRn inhibitor portfolio; and • $14.0 million increase in chemistry, manufacturing and controls costs to support IND-enabling activities. 86 These increases were partially offset by a $16.3 million decrease in milestone, license and option fees as a result expenses incurred during the year ended December 31, 2023, primarily due to a $15.0 million upfront payment related to the development of subcutaneous delivery systems.
Under the Hercules Amendment, the Lenders provided the Company access to an increased term loan with an aggregate principal amount of up to $150 million, in four tranches (collectively the “Amended Term Loan”), consisting of (1) an initial tranche of $50.0 million, $5.0 million of which was drawn at closing of the Hercules Loan and Security Agreement in April 79 2022, $15.0 million of which was drawn at closing of the Hercules Amendment in August 2023, $5.0 million available through December 15, 2023, and $25.0 million available from July 1, 2024 through December 15, 2024; (2) a second tranche of $20.0 million, subject to achievement of certain regulatory milestones, available through February 15, 2025; (3) a third tranche of $20.0 million, subject to achievement of certain regulatory milestones, available through March 31, 2025; and (4) a fourth tranche of $60.0 million subject to approval by the Lenders’ investment committee(s), available through June 15, 2025.
Under the Hercules Amendment, the Lenders provided the Company access to an increased term loan with an aggregate principal amount of up to $150 million, in four tranches (collectively the “Amended Term Loan”), consisting of (1) an initial tranche of $50.0 million, $5.0 million of which was drawn at closing of the Hercules Loan and Security Agreement in April 2022, $15.0 million of which was drawn at closing of the Hercules Amendment in August 2023, $5.0 million of which was available through December 15, 2023, and $25.0 million of which was available from July 1, 2024 through December 15, 2024; (2) a second tranche of $20.0 million, subject to achievement of certain regulatory milestones, available through February 15, 2025; (3) a third tranche of $20.0 million, subject to achievement of certain regulatory milestones, available through March 31, 2025; and (4) a fourth tranche of $60.0 million subject to approval by the Lenders’ investment committee(s), available through June 15, 2025.
Global Economic Considerations The global macroeconomic environment is uncertain, and could be negatively affected by, among other things, increased U.S. trade tariffs and trade disputes with other countries, instability in the global capital and credit markets, supply chain weaknesses, and instability in the geopolitical environment, including as a result of the Russian invasion of Ukraine, the rising tensions between China and Taiwan, the conflict in Israel and surrounding area and other political tensions.
Global Economic Considerations 83 The global macroeconomic environment is uncertain, and could be negatively affected by, among other things, increased U.S. trade tariffs and trade disputes with other countries, instability in the global capital and credit markets, supply chain weaknesses, and instability in the geopolitical environment, including as a result of the Russian invasion of Ukraine, the rising tensions between China and Taiwan, the conflict in Israel and surrounding area and other political tensions.
Should additional capital not be available to us in the near term, or not be available on acceptable terms, we may be unable to realize value from our assets and discharge our liabilities in the normal course of business, which may, among other alternatives, cause us to further delay, substantially reduce, or discontinue operational activities to conserve our cash resources.
Should additional capital not be available to us in the near term, or not be available on acceptable terms, we may be unable to realize value from our assets and discharge our 88 liabilities in the normal course of business, which may, among other alternatives, cause us to further delay, substantially reduce, or discontinue operational activities to conserve our cash resources.
The change in working capital was primarily related to a decrease of $7.0 million in accounts payable and accrued and other liabilities and an increase of $2.1 million in prepaid expenses and other current assets due to the timing of payments and prepayments to vendors for ongoing clinical trial and manufacturing activities.
The change in working capital was primarily related to a decrease of $7.0 million 90 in accounts payable and accrued and other liabilities and an increase of $2.1 million in prepaid expenses and other current assets due to the timing of payments and prepayments to vendors for ongoing clinical trial and manufacturing activities.
Overview We are a biopharmaceutical company focused on discovering and developing potential best-in-class medicines for serious and rare diseases. We target disease areas where marketed therapies often leave room for improvements in efficacy, safety, and/or dosing convenience.
Overview We are a biopharmaceutical company focused on discovering, developing and commercializing potential best-in-class medicines for serious and rare diseases. We target disease areas where marketed therapies often leave room for improvements in efficacy, safety, and/or dosing convenience.
The royalty percentage may vary based on different tiers of annual net sales of the licensed 75 products made. Zenas BioPharma is obligated to make royalty payments to us for the royalty term in the Zenas Agreements.
The royalty percentage may vary based on different tiers of annual net sales of the licensed products made. Zenas BioPharma is obligated to make royalty payments to us for the royalty term in the Zenas Agreements.
We intend to prioritize indications where a fast-follower and a potentially differentiated drug candidate, or overall product profile, could create significant medical benefit for patients. We are engineering medicines to address unmet medical needs for patients and further advance drug innovation. Our goal is to identify and evaluate product concepts leveraging clinically validated molecular targets using established therapeutic modalities.
We intend to prioritize indications where a fast-follower and a potentially differentiated drug candidate, or overall product profile, could create significant medical benefit for patients. We are engineering product candidates to address unmet medical needs for patients and further advance drug innovation. Our goal is to identify and evaluate product concepts leveraging clinically validated molecular targets using established therapeutic modalities.
We consider future economic benefits from acquired contractual rights to licensed technology to be uncertain until such a drug candidate is approved by the FDA or when other significant risk factors are abated. We expect that our research and development expenses will increase as we expand our clinical development programs and initiate new clinical trials.
We consider future economic benefits from acquired contractual rights to licensed technology to be uncertain until such a drug candidate is approved by the FDA or other regulatory authorities, or when other significant risk factors are abated. We expect that our research and development expenses will increase as we expand our clinical development programs and initiate new clinical trials.
Such challenges have caused, and may continue to cause, recession fears, concerns regarding potential sanctions, rising interest rates, foreign exchange volatility and inflationary pressures. At this time, we are unable to quantify the potential effects of this economic instability on our future operations.
Such challenges have caused, and may continue to cause, recession fears, concerns regarding potential sanctions, high interest rates, foreign exchange volatility and inflationary pressures. At this time, we are unable to quantify the potential effects of this economic instability on our future operations.
Our business model is designed to identify and evaluate product opportunities in disease areas where trial data establishes proof-of-concept for a 73 drug target in the clinic, but the competitive evolution of the product life cycle management and number of entrants appears incomplete.
Our business model is designed to identify and evaluate product opportunities in disease areas where trial data 81 establishes proof-of-concept for a drug target in the clinic, but the competitive evolution of the product life cycle management and number of entrants appears incomplete.
The probability of success for each product candidate may be affected by numerous factors, including clinical data, preclinical data, competition, manufacturability and commercial viability of our product candidates. Successful development of future product candidates is highly uncertain and may not result in approved products.
The probability of success for each product candidate may be affected by numerous factors, including clinical data, nonclinical data, competition, manufacturability and commercial viability of our product candidates. Successful development of future product candidates is highly uncertain and may not result in approved products.
The process of conducting clinical trials and preclinical studies necessary to obtain regulatory approval is costly and time consuming. We, or our strategic alliance collaborators, if any, may never succeed in achieving marketing approval for any of our product candidates.
The process of conducting clinical trials and nonclinical studies necessary to obtain regulatory approval is costly and time consuming. We, or our strategic alliance collaborators, if any, may never succeed in achieving marketing approval for any of our product candidates.
Our material cash requirements include obligations as of December 31, 2023, as well as resources required to fulfill our research and development activities and the effects that such obligations and activities are expected to have on our liquidity and cash flows in future periods.
Our material cash requirements include obligations as of December 31, 2024, as well as resources required to fulfill our research and development activities and the effects that such obligations and activities are expected to have on our liquidity and cash flows in future periods.
ATM Agreements In September 2022, we entered into the September 2022 ATM Agreement with Jefferies LLC (“Jefferies”) pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $175.0 million from time to time at prices and on terms to be determined by market conditions at the time of offering, with Jefferies acting as the sales agent.
ATM Agreement In September 2022, we entered into the September 2022 ATM Agreement with Jefferies pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $175.0 million from time to time at prices and on terms to be determined by market conditions at the time of offering, with Jefferies acting as the sales agent.
Clinical Trial and Preclinical Study Accruals We make estimates of our accrued expenses as of each balance sheet date in our consolidated financial statements based on certain facts and circumstances at that time.
Clinical Trial and Nonclinical Study Accruals We make estimates of our accrued expenses as of each balance sheet date in our consolidated financial statements based on certain facts and circumstances at that time.
Across all VRDN-001 treated patients in the chronic TED trial, 42% were proptosis responders, 40% achieved a CAS of 0 or 1, and no patients had complete resolution of their diplopia. In the Phase 1/2 clinical trials of both active and chronic TED, VRDN-001 had a favorable safety profile and was well-tolerated by all patients treated in all dose cohorts.
Across all veligrotug treated patients in the chronic TED trial, 42% were proptosis responders, 40% achieved a CAS of 0 or 1, and no patients had complete resolution of their diplopia. In the phase 1/2 clinical trials of both active and chronic TED, veligrotug had a favorable safety profile and was well-tolerated by all patients treated in all dose cohorts.
The Amended Term Loan bears interest at a floating per annum rate equal to the greater of (1) 7.45% and (2) 4.2% above the Prime Rate (as defined therein), provided that the Term Loan interest rate shall not exceed a per annum rate of 8.95%. Interest is payable monthly in arrears on the first day of each month.
The Amended Term Loan bears interest at a floating per annum rate equal to the greater of (i) 7.45% and (ii) 4.2% above the Prime Rate (as defined therein), provided that the Term Loan interest rate shall not exceed a per annum rate of 8.95%. Interest is payable monthly in arrears on the first day of each month.
We focus on advancing therapeutic proteins, including antibodies, that we either in-license or discover internally, incorporating proprietary therapeutic protein and antibody discovery and optimization platforms to advance clinical candidates with unique characteristics.
We focus on advancing therapeutic proteins that we either in-license or discover internally, incorporating proprietary therapeutic protein and antibody discovery and optimization platforms to advance clinical candidates with unique characteristics.
During the quarter ended December 31, 2023, the Company sold 684,298 shares under the September 2022 ATM Agreement with Jefferies at a weighted average price of $22.30 per share, for aggregate net proceeds of approximately $14.8 million, including commissions to Jefferies as a sales agent.
During the year ended December 31, 2023, the Company sold 684,298 shares under 89 the September 2022 ATM Agreement with Jefferies at a weighted average price of $22.30 per share, for aggregate net proceeds of approximately $14.8 million, including commissions to Jefferies as a sales agent.
Research and Development Expenses Research and development expenses consist of costs incurred for the research and development of our therapeutic programs and product candidates, which include: • employee-related expenses, including salaries, severance, retention, benefits, insurance, and share-based compensation expense; • expenses incurred under agreements with CROs, investigative sites that conduct our clinical trials, and other clinical trial-related vendors, and consultants; • the costs of acquiring, developing, and manufacturing and testing clinical and preclinical materials, including costs incurred under agreements with CMOs; • costs associated with non-clinical activities and regulatory operations; • license fees and milestone payments related to the acquisition and retention of certain licensed technology and intellectual property rights; and • facilities, depreciation, market research, and other expenses, which include allocated expenses for rent and maintenance of facilities, depreciation of leasehold improvements and equipment, and laboratory supplies.
Research and Development Expenses Research and development expenses consist of costs incurred for the research and development of our therapeutic programs and product candidates, which include: • employee-related expenses, including salaries, severance, retention, benefits, insurance, and share-based compensation expense; • expenses incurred under agreements with CROs, investigative sites that conduct our clinical trials, and other clinical trial-related vendors, and consultants; • the costs of acquiring, developing, and manufacturing and testing clinical and nonclinical materials, including costs incurred under agreements with CDMOs; • costs associated with nonclinical activities and regulatory operations; • license fees and milestone payments related to the acquisition and retention of certain licensed technology and intellectual property rights; and 84 • facilities, depreciation, market research, and other expenses, which include allocated expenses for rent and maintenance of facilities, depreciation of leasehold improvements and equipment, and laboratory supplies.
In the chronic TED portion of the Phase 1/2 clinical trials, data reported from both dose cohorts of VRDN-001 (n=12) showed significant and rapid improvement in the signs and symptoms of TED after two infusions of VRDN-001 compared to placebo.
In the chronic TED portion of the phase 1/2 clinical trials, data reported from both dose cohorts of veligrotug (n=12) showed significant and rapid improvement in the signs and symptoms of TED after two infusions of veligrotug compared to placebo.
We also conducted Phase 1/2 clinical trials of VRDN-001 in patients with active or chronic TED. In the active TED portion of the Phase 1/2 clinical trials, data reported from all three dose cohorts of VRDN-001 (n=21) showed significant and rapid improvement in both the signs and symptoms of TED after two infusions of VRDN-001 compared to placebo.
We conducted phase 1/2 clinical trials of veligrotug in patients with active or chronic TED. In the active TED portion of the phase 1/2 clinical trials, data reported from all three dose cohorts of veligrotug (n=21) showed significant and rapid improvement in both the signs and symptoms of TED after two infusions of veligrotug compared to placebo.
Our multi-pronged engineering approach has resulted in a portfolio of FcRn-targeting molecules that leverage the clinically and commercially validated mechanism of FcRn inhibition while potentially addressing the limitations of current agents such as incomplete IgG suppression, safety, and inconvenience of dosing.
Our multi-pronged engineering approach has resulted in a portfolio of FcRn-targeting molecules that leverage the clinically and commercially validated mechanism of FcRn inhibition while potentially addressing the limitations of current agents such as incomplete immunoglobulin G (“IgG”) suppression, safety, and inconvenience of dosing.
Discussions of the year ended December 31, 2021 and year-to-year comparisons between the years ended December 31, 2022 and 2021 have been excluded from this Form 10-K and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 9, 2023.
Discussions of the year ended December 31, 2022 and year-to-year comparisons between the years ended December 31, 2023 and 2022 have been excluded from this Form 10-K and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 27, 2024.
This section discusses 2023 and 2022 items and year-to-year comparisons between the years ended December 31, 2023 and 2022.
This section discusses 2024 and 2023 items and year-to-year comparisons between the years ended December 31, 2024 and 2023.
Other income, net for the year ended December 31, 2022 is comprised of $4.6 million of interest income earned on short-term investments as well as $0.3 million of sub-lease income, offset by $0.5 million in interest expense related to our Hercules Loan and Security Agreement.
Other income, net for the year ended December 31, 2024 is comprised of $31.6 million of interest income earned on short-term investments as well as $0.3 million of sub-lease income, offset by $2.2 million in interest expense related to our Hercules Loan and Security Agreement, and $0.6 million in other losses.
The milestones for the second and third tranches have not yet been achieved. The obligations of the Borrower under the Hercules Amendment agreement are secured by substantially all of the assets of the Borrower, excluding the Borrower’s intellectual property. The Amended Term Loan has a maturity date of October 1, 2026.
As of December 31, 2024, the milestones for the second and third tranches have been achieved. The obligations of the Borrower under the Hercules Amendment agreement are secured by substantially all of the assets of the Borrower, excluding the Borrower’s intellectual property. The Amended Term Loan has a maturity date of October 1, 2026.
The VRDN-003 Phase 1 clinical study showed VRDN-003 to have a prolonged half-life of 40 to 50 days, which is four to five times that of its parent molecule, VRDN-001.
The VRDN-003 phase 1 clinical study showed VRDN-003 to have a prolonged half-life of 40 to 50 days, which is four to five times that of veligrotug.
Further, pharmacokinetic modeling of VRDN-003 predicted that exposure levels of VRDN-003 could be achieved that are equivalent to exposure levels of VRDN-001 that produced clinically meaningful results with multiple dosing regimens of VRDN-003, i.e., subcutaneous injection every two, four, or eight weeks.
Further, pharmacokinetic modeling of VRDN-003 based on the healthy volunteer data predicted that exposure levels of VRDN-003 could be achieved that are equivalent to exposure levels of veligrotug that produced clinically meaningful results with multiple dosing regimens of VRDN-003, i.e., subcutaneous injection every two, four, or eight weeks.
Zenas BioPharma announced that it had obtained IND approval in China in July 2022. Additionally, we are eligible to receive royalty payments based on a percentage of the annual net sales of any licensed products sold on a country-by-country basis in the greater area of China.
Zenas BioPharma announced that it had obtained IND approval in China in July 2022. Under the license agreement, we received a $1.0 million milestone payment from Zenas BioPharma. Additionally, we are eligible to receive royalty payments based on a percentage of the annual net sales of any licensed products sold on a country-by-country basis in the greater area of China.
We have built relevant expertise in protein and antibody discovery and engineering, biologics manufacturing, nonclinical and clinical development for TED, development of anti-neonatal Fc receptor therapies, and nonclinical and clinical development for indications in rare and autoimmune diseases.
We have built relevant expertise in protein and antibody discovery and engineering, biologics manufacturing, nonclinical and clinical development, and commercialization for thyroid eye disease (“TED”), development of anti-neonatal Fc receptor (“FcRn”) therapies, and nonclinical and clinical development for indications in rare and autoimmune diseases.
The aggregate gross proceeds to us from the 2022 Public Offering, including the exercise of the option, were approximately $311.0 million, before deducting underwriting discounts and commissions and other offering expenses payable by us.
The aggregate gross proceeds to us from the September 2024 Public Offering, including the exercise of the option, were approximately $258.8 million, before deducting underwriting discounts and commissions and other offering expenses payable by us.
Across all VRDN-001 treated patients in the active TED trial, 71% were proptosis responders, 67% were overall responders, 62% achieved a CAS of 0 or 1, and 54% had complete resolution of their diplopia.
Across all veligrotug treated patients in the active TED trial, 71% were proptosis responders, 67% were overall responders, 62% achieved a clinical activity score (“CAS”) of 0 or 1, and 54% had complete resolution of their diplopia.
We expect our research and development expenses to continue to increase as we work to progress our clinical and preclinical programs. General and Administrative Expenses General and administrative expenses were $95.0 million during the year ended December 31, 2023, compared to $35.2 million during the year ended December 31, 2022.
We expect our research and development expenses to continue to increase as we work to progress our clinical and nonclinical programs. General and Administrative Expenses General and administrative expenses were $61.1 million during the year ended December 31, 2024, compared to $95.0 million during the year ended December 31, 2023.
We are evaluating VRDN-001 in two global Phase 3 clinical trials, THRIVE and THRIVE-2, for the treatment of active and chronic TED, respectively. THRIVE and THRIVE-2 are each designed to compare a five-dose IV treatment arm of VRDN-001 at 10 mg/kg, dosed three weeks apart, to placebo.
We are conducting a global pivotal program for veligrotug, including evaluating its efficacy and safety in two global well-controlled phase 3 clinical trials, THRIVE and THRIVE-2, for the treatment of active and chronic TED, respectively. THRIVE and THRIVE-2 are each designed to compare a five-dose IV treatment arm of veligrotug at 10 mg/kg, dosed three weeks apart, to placebo.
In addition, the Borrower is required to pay an end-of-term fee equal to 6% of the principal amount of funded Amended Term Loan advances at maturity, which are being accreted as additional interest expense over the term of the loan. Upon execution of the Hercules Amendment, we drew a principal amount of $15.0 million.
In addition, the Borrower is required to pay an end-of-term fee equal to 6% of the principal amount of funded Amended Term Loan advances at maturity, which are being accreted as additional interest expense over the term of the loan.
VRDN-006 is a FcRn-targeting Fc fragment, and in non-human primate studies, demonstrated specificity for blocking FcRn-IgG interactions while not showing decreases in albumin or increases in LDL levels, which are known potential side effects associated with certain full-length monoclonal anti-FcRn antibodies.
In non-human primate (“NHP”) studies, VRDN-006 demonstrated specificity for blocking FcRn-IgG interactions while not showing decreases in albumin or increases in low-density lipoprotein (“LDL”) levels, which are known potential side effects associated with certain full-length anti-FcRn monoclonal antibodies.
Investing Activities Net cash used in investing activities was $94.3 million during the year ended December 31, 2023. Net cash used in investing activities in 2023 primarily consisted of net purchases of investments of $93.4 million and property and equipment purchases of $0.9 million. Net cash used in investing activities was $115.1 million during the year ended December 31, 2022.
Investing Activities Net cash used in investing activities was $228.7 million during the year ended December 31, 2024. Net cash used in investing activities in 2024 primarily consisted of net purchases of investments of $228.1 million and property and equipment purchases of $0.5 million. Net cash used in investing activities was $94.3 million during the year ended December 31, 2023.
We expect that our operating losses will fluctuate significantly from quarter to quarter and year to year due to timing of our development activities and efforts to achieve regulatory approval.
We expect that our operating losses will fluctuate significantly from quarter to quarter and year to year due to timing of our development activities and efforts to achieve regulatory approval. Our commitments primarily consist of obligations under our collaboration, development, and license agreements.
Net cash used in investing activities in 2022 primarily consisted of net purchases of investments of $114.3 million and property and equipment purchases of $0.8 million. Financing Activities Net cash provided by financing activities was $225.7 million during the year ended December 31, 2023.
Net cash used in investing activities in 2023 primarily consisted of net purchases of investments of $93.4 million and property and equipment purchases of $0.9 million. Financing Activities Net cash provided by financing activities was $457.7 million during the year ended December 31, 2024.
Because of the similarities between the VRDN-001 and VRDN-003 antibodies, we expect VRDN-003 to have similar clinical responses at the exposure levels of VRDN-001 that led to robust clinical activity in its Phase 2 clinical trial in TED.
Because of the healthy volunteer data and the similarities between the veligrotug and VRDN-003 antibodies, we expect VRDN-003 to have similar clinical responses at the exposure levels of veligrotug that led to robust clinical activity in its clinical trials to date in TED.
If additional development milestones are met, the interest-only period will be further extended to April 1, 2026. The Borrower is required to repay the Amended Term Loan amount in equal monthly installments of the principal amount and interest between the end of the interest-only period and the maturity date of October 1, 2026.
The Borrower is required to repay the Amended Term Loan amount in equal monthly installments of the principal amount and interest between the end of the interest-only period and the maturity date of October 1, 2026.
The milestone related to the third tranche was not achieved prior to amendment of the Hercules Loan and Security Agreement in August 2023. Upon signing we drew an initial principal amount of $5.0 million. Per the terms of the Hercules Loan and Security Agreement, we were originally obligated to make interest-only payments through April 1, 2024.
Upon signing, we drew an initial principal amount of $5.0 million. Per the terms of the Hercules Loan and Security Agreement, we were originally obligated to make interest-only payments through April 1, 2024, which was extended to October 1, 2024 upon the achievement of a development milestone in August 2022.
Net cash provided by financing activities was $322.2 million for the year ended December 31, 2022.
Net cash provided by financing activities was $225.7 million for the year ended December 31, 2023.
Net cash used in operating activities was $93.8 million for the year ended December 31, 2022, and primarily consisted of a net loss of $129.9 million, adjusted for non-cash items of $20.1 million, including share-based compensation of $19.8 million and working capital adjustments of $16.0 million.
Net cash used in operating activities was $184.2 million for the year ended December 31, 2023, and primarily consisted of a net loss of $237.7 million, adjusted for non-cash items of $63.0 million, including share-based compensation of $67.2 million and working capital adjustments of $9.4 million.
The change in working capital was primarily related to an increase of $7.7 million in accrued and other liabilities and an increase of $3.3 million in prepaid expenses and other current assets due to the timing of payments and prepayments to vendors for ongoing clinical trial and manufacturing activities, and an increase of $11.5 million in accounts payable primarily due to a $10.0 million milestone payment due under a license agreement as of December 31, 2022.
The change in working capital was primarily related to an increase of $21.5 million in accounts payable and accrued and other liabilities, partially offset by an increase of $11.8 million in prepaid expenses and other current assets due to the timing of payments and prepayments to vendors for ongoing clinical trial and manufacturing activities.
Net cash provided by financing activities in 2022 was primarily driven by net proceeds of $313.8 million from the 2022 Public Offering and the September 2022 ATM Agreement, $4.6 million in net proceeds from the Hercules Loan and Security Agreement, as well as $2.8 million in proceeds from the exercise of stock options, $0.9 million in proceeds from the exercise of warrants and $0.2 million in proceeds from the issuance of common stock under our employee stock purchase plan. 81
Net cash provided by financing activities in 2024 was primarily driven by net proceeds of $451.7 million from the 2024 Public Offerings and the September 2022 ATM Agreement, as well as $5.3 million in proceeds from the exercise of stock options and $0.7 million in proceeds from the issuance of common stock under our employee stock purchase plan.
Under the Hercules Loan and Security Agreement, the Lenders provided us with access to a term loan with an aggregate principal amount of up to $75.0 million, in four tranches (collectively the “Term Loan”), consisting of: (1) an initial tranche of $25.0 million, which was available through June 15, 2023; (2) a second tranche of $10.0 million, subject to the achievement of certain regulatory milestones, which was available through June 15, 2023; (3) a third tranche of $15.0 million, subject to the achievement of certain regulatory milestones, available through March 15, 2024; and (4) a fourth tranche of $25.0 million, subject to approval by the Lenders’ investment committee(s), available through December 15, 2024.
Under the Hercules Loan and Security Agreement, the Lenders provided us with access to a term loan with an aggregate principal amount of up to $75.0 million, in four tranches (collectively the “Term Loan”), including an initial tranche of $25.0 million, which was available to us through June 15, 2023.
In August 2023, we executed an amendment to the Hercules Loan and Security Agreement (the “Hercules Amendment”).
In August 2023, we executed an amendment to the Hercules Loan and Security Agreement (the “Hercules Amendment”). The Hercules Amendment was determined to substantially alter the Hercules Loan and Security Agreement and therefore was accounted for as a debt extinguishment.
Liquidity and Capital Resources We have funded our operations to date principally through proceeds received from the sale of our common stock, our Series A Preferred Stock, our Series B Preferred Stock and other equity securities, debt financings, license fees, and reimbursements received under collaboration agreements.
The increase in interest income is primarily attributable to higher interest rates and higher average short-term investments balances during the year ended December 31, 2024 as compared to the year ended December 31, 2023. 87 Liquidity and Capital Resources We have funded our operations to date principally through proceeds received from the sale of our common stock, our Series A Convertible Preferred Stock, our Series B Convertible Preferred Stock and other equity securities, debt financings, license fees, and reimbursements received under collaboration agreements.
We will need to raise additional capital and may seek additional strategic alliances in the future in order to advance the various clinical trials that are part of our clinical development program described above. 76 General and Administrative Expenses General and administrative expenses consist primarily of salaries and related benefits, including share-based compensation, and severance and retention benefits related to our finance, accounting, human resources, legal, business development, and other support functions, professional fees for auditing, tax, and legal services, as well as insurance, board of director compensation, consulting, and other administrative expenses.
General and Administrative Expenses General and administrative expenses consist primarily of salaries and related benefits, including share-based compensation, and severance and retention benefits related to our finance, accounting, human resources, legal, business development, and other support functions, professional fees for auditing, tax, and legal services, market research and other professional and consulting fees to prepare for commercial activities, as well as insurance, board of director compensation, consulting, and other administrative expenses.
The interest rate as of December 31, 2023 was 8.95%. Per the terms of the Hercules Amendment, we are obligated to make interest-only payments through April 1, 2025. If certain development milestones are met, then the interest-only period will be extended to October 1, 2025.
The interest rate as of December 31, 2024 was 8.95%. Per the terms of the Hercules Amendment, we were originally obligated to make interest-only payments through April 1, 2025. Upon achievement of certain development milestones related to our topline results for our phase 3 THRIVE trial in September 2024, the interest-only period was extended to October 1, 2025.
Pursuant to the Securities Purchase Agreement, we agreed to sell an aggregate of 8,869,797 shares of common stock at a price of $12.38 per share (the closing price of our common stock on October 27, 2023), and 92,312 shares of the Company’s Series B non-voting convertible preferred stock at a price of $825.3746 per share.
Private Placements In November 2023, we issued and sold in private placement transactions an aggregate of 8,869,797 shares of our common stock at a price per share of $12.38 and 92,312 shares of our Series B Convertible Preferred Stock at a price per share of $825.3746, pursuant to securities purchase agreements with certain institutional and accredited investors.
We have no products approved for commercial sale and have not generated any revenue from product sales. Since our inception and through December 31, 2023, we have generated an accumulated deficit of $725.9 million.
In addition, as of December 31, 2024, the Company has access to additional undrawn funds under the Hercules Amended Term Loan, as described below. We have no products approved for commercial sale and have not generated any revenue from product sales. Since our inception and through December 31, 2024, we have generated an accumulated deficit of $995.9 million.
We believe VRDN-003 has the potential to be the best-in-class subcutaneous anti-IGF-1R program by preserving the efficacy of anti-IGF-1Rs in TED, improving safety, and maximizing convenience for patients. VRDN-003 has the same binding domain as its parent molecule, VRDN-001, and was engineered to have a longer half-life. VRDN-003 is designed to be a low-volume, self-administered, infrequently-dosed subcutaneous IGF-1R for TED.
VRDN-003 is designed to be a low-volume, infrequently-dosed subcutaneous IGF-1R for TED, which we plan to launch commercially with an auto-injector to enable at-home patient self-administration. We believe VRDN-003 has the potential to be the best-in-class subcutaneous anti-IGF-1R product candidate by preserving the efficacy of anti-IGF-1Rs in TED, improving safety and maximizing convenience for patients.
Our accrued expenses for preclinical studies and clinical trials are based on estimates of costs incurred for services provided by external service providers and for other trial-related activities. The timing and amount of expenses we incur through our external service providers depend on a number of factors, such as site initiation, patient screening, enrollment, delivery of reports, and other events.
Our accrued expenses for nonclinical studies and clinical trials are based on estimates of costs incurred for services provided by external service providers and for other trial-related activities.
The $59.8 million increase in general and administrative expenses is primarily attributable to the following: • $25.6 million increase in personnel costs, including share based compensation, due to an increase in headcount; • $31.0 million of severance costs primarily related to separation agreements with former executive officers, including $26.1 million of incremental share-based compensation related to the modification and acceleration of stock option vesting; and; • $7.9 million increase in professional and license fees due to market research, accounting and other professional fees to support the growing organization and prepare for commercial activities.
The $33.9 million decrease in general and administrative expenses is primarily attributable to the following: • $27.2 million decrease in severance costs, due primarily to separation agreements with former executive officers, including a $22.7 million decrease in share-based compensation related to the modification and acceleration of stock option vesting for former executives.
Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 Year Ended December 31, 2023 2022 Increase (Decrease) (in thousands) Revenue $ 314 $ 1,772 $ (1,458) Research and development expenses 159,765 100,894 58,871 General and administrative expenses 94,999 35,182 59,817 Other income (expense), net 16,716 4,430 12,286 Net loss $ (237,734) $ (129,874) $ (107,860) Revenue Revenue was $0.3 million for the year ended December 31, 2023, as compared to $1.8 million for the year ended December 31, 2022.
Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 Year Ended December 31, 2024 2023 Increase (Decrease) (in thousands) Revenue $ 302 $ 314 $ (12) Research and development expenses 238,254 159,765 78,489 General and administrative expenses 61,083 94,999 (33,916) Other income (expense), net 29,086 16,716 12,370 Net loss $ (269,949) $ (237,734) $ (32,215) Revenue Revenue was $0.3 million for the years ended December 31, 2024 and 2023.
In our head-to-head non-human primate studies, VRDN-006 demonstrated comparable potency and IgG lowering to Vyvgart® (efgartigimod), the current standard of care in FcRn inhibition, as well as a similar safety profile. We plan to file an IND for VRDN-006 by the end of 2024 and expect healthy volunteer data for VRDN-006 in the second half of 2025.
In our head-to-head NHP studies, VRDN-006 demonstrated comparable potency and IgG reductions to efgartigimod, which is the current standard of care in FcRn inhibition, as well as a similar safety profile.
Revenue for both periods was attributable to our collaboration agreement with Zenas BioPharma. The $1.5 million decrease in revenue is due to the timing of activities performed under the collaboration agreement.
Revenue for both periods was attributable to our collaboration agreement with Zenas BioPharma.
Our aggregate gross proceeds from the 2023 Private Placement were approximately $186.0 million, before deducting offering expenses payable by us. 80 Summarized cash flows for the year ended December 31, 2023 and 2022 are as follows: Year Ended December 31, 2023 2022 (in thousands) Net cash provided by (used in): Operating activities $ (184,170) $ (93,838) Investing activities (94,252) (115,126) Financing activities 225,670 322,244 Total $ (52,752) $ 113,280 Operating Activities Net cash used in operating activities was $184.2 million for the year ended December 31, 2023, and primarily consisted of a net loss of $237.7 million, adjusted for non-cash items of $63.0 million, including share-based compensation of $67.2 million and working capital adjustments of $9.4 million.
Summarized cash flows for the year ended December 31, 2024 and 2023 are as follows: Year Ended December 31, 2024 2023 (in thousands) Net cash provided by (used in): Operating activities $ (232,319) $ (184,170) Investing activities (228,651) (94,252) Financing activities 457,737 225,670 Total $ (3,233) $ (52,752) Operating Activities Net cash used in operating activities was $232.3 million for the year ended December 31, 2024, and primarily consisted of a net loss of $269.9 million, adjusted for non-cash items of $28.0 million, including share-based compensation of $42.2 million partially offset by accretion and amortization of premiums and discounts on available-for-sale securities of $15.7 million, and working capital adjustments of $9.6 million.
This five-dose VRDN-001 regimen features fewer infusions and a shorter time per infusion compared to teprotumumab, the currently marketed IGF-1R inhibitor. We expect to report topline THRIVE and THRIVE-2 data in the middle of 2024 and by year end 2024, respectively.
This five-dose veligrotug regimen features fewer infusions and a shorter time per infusion compared to teprotumumab, the currently marketed IGF-1R inhibitor. On September 10, 2024, we announced topline data from the THRIVE study, which enrolled 113 patients, randomized to veligrotug (n=75) and placebo (n=38).
As of December 31, 2023, we had $477.4 million in cash, cash equivalents, and short- 78 term investments. We expect that our current resources, including the gross proceeds of $186.3 million received in January 2024 from the sale of the Company’s common stock, will enable us to fund our planned operations into the second half of 2026.
As of December 31, 2024, we had $717.6 million in cash, cash equivalents, and short-term investments. We expect that our current cash, cash equivalents and short-term investments will be sufficient to fund our planned operations, including our clinical development plan described elsewhere in this Annual Report, into the second half of 2027.
Underwritten Public Offerings In August 2022, we entered into an underwriting agreement with Jefferies, Leerink Partners LLC and Evercore Group LLC relating to the offer and sale of 11,352,640 shares of our common stock, which includes 1,725,000 shares of common stock issued in connection with the exercise in full by the underwriters of their option to purchase additional shares at a public offering price of $23.50 per share, and 28,084 shares of the Company’s Series B Non-Voting Convertible Preferred Stock, at a public offering price of $1,566.745 per share (collectively, the “2022 Public Offering”).
LLC and Stifel, Nicolaus & Company, Incorporated related to the offer and sale (the “September 2024 Public Offering”) of 12,466,600 shares of our common stock, which includes 1,800,000 shares of common stock issued in connection with the exercise in full by the underwriters of their option to purchase additional shares at a public offering price of $18.75 per share, and 20,000 shares of our Series B Convertible Preferred Stock at a price per share of $1,250.0625 per share.
Our most advanced program, VRDN-001, is a differentiated humanized monoclonal antibody targeting IGF-1R intravenously administered for the treatment of TED. In previously presented in vitro preclinical data, we showed that VRDN-001 is a potentially differentiated full antagonist of IGF-1R, compared to teprotumumab’s incomplete antagonism of IGF-1R.
In previously presented in vitro nonclinical data, we showed that veligrotug is a potentially differentiated full antagonist of IGF-1R, compared to teprotumumab’s incomplete antagonism of IGF-1R. VRDN-003 has the same binding domain as veligrotug, and was engineered to have a longer half-life.
In accruing for these activities, we obtain information from various sources and estimate the level of effort or expense allocated to each period. Adjustments to our research and development expenses may be necessary in future periods as our estimates change.
Adjustments to our research and development expenses may be necessary in future periods as our estimates change.
The Hercules Amendment was determined to substantially alter the Hercules Loan and Security Agreement and therefore was accounted for as a debt extinguishment. We recognized a loss on debt extinguishment of $0.2 million related to unamortized debt discount and debt issuance costs as a component of other income, net in the consolidated statements of operations and comprehensive loss.
We recognized a loss on debt extinguishment of $0.2 million in August 2023 related to unamortized debt discount and debt issuance costs.
We expect that the THRIVE and THRIVE-2 Phase 3 trials, together with a safety database comprising 300 treated patients will support global health authority registration for marketing approval in both active and chronic TED, respectively. 74 In addition to our VRDN-001 IV program, in December 2023 we selected VRDN-003 as our prioritized subcutaneous program for pivotal development in TED following positive data in a Phase 1 clinical trial in healthy volunteers.
In addition to our intravenous veligrotug program, VRDN-003 is our subcutaneous product candidate currently in pivotal development in TED, which we selected in December 2023 following positive data in a phase 1 clinical trial in healthy volunteers.
However, upon the achievement of a development milestone in August 2022, the interest-only period was extended to October 1, 2024. If additional development milestones were met, the interest-only period would be further extended to April 1, 2025 pursuant to a second extension.
Upon achievement of certain development milestones related to topline results for the Company’s phase 3 THRIVE-2 trial in December 2024, the interest-only period was further extended to April 1, 2026.
Other Income, net Other income, net was $16.7 million during the year ended December 31, 2023 compared to $4.4 million during the year ended December 31, 2022.
These decreases were partially offset by a $2.9 million increase in legal services, market research and other professional and consulting fees to prepare for commercial activities. Other Income, net Other income, net was $29.1 million during the year ended December 31, 2024 compared to $16.7 million during the year ended December 31, 2023.
Based on these results, we expect to initiate a global pivotal program with VRDN-003 in mid-2024, with planned trials in both active and chronic TED patients, pending regulatory authority alignment. In addition to developing therapies for TED, we are also developing a portfolio of engineered anti-FcRn inhibitors, including VRDN-006 and VRDN-008.
We anticipate topline data for REVEAL-1 and REVEAL-2 in the first half of 2026, and we anticipate submitting a BLA for VRDN-003 for the treatment of TED by the end of 2026. Development of FcRn Inhibitors In addition to developing therapies for TED, we are also developing a portfolio of engineered FcRn inhibitors, including VRDN-006 and VRDN-008.
Removed
We have first prioritized the development of therapies for the treatment of TED, a serious and debilitating rare autoimmune disease that causes inflammation within the orbit of the eye that can cause bulging of the eyes, redness and swelling, double vision, pain, and potential blindness.
Added
Development of Therapies to Treat Thyroid Eye Disease (TED) We are developing two product candidates, veligrotug (formerly known as VRDN-001) for intravenous and VRDN-003 for subcutaneous administration, to treat patients who suffer from TED. Our most advanced program, veligrotug, is a differentiated humanized monoclonal antibody targeting IGF-1R intravenously administered for the treatment of TED.
Removed
TED significantly impacts quality of life, imposing a high burden on activities of daily living and mental health for patients suffering from the disease. TED is a progressive disease consisting of an initial active phase, followed by a transition to a secondary chronic phase.
Added
THRIVE achieved all primary and secondary endpoints with a high level of statistical significance (p 82 requirements for the veligrotug biologics license application (“BLA”), we are conducting our STRIVE clinical trial (safety database inclusive of patients from the THRIVE and THRIVE-2 trials).
Removed
The only medicine approved by the FDA for TED is Tepezza® (teprotumumab), which is an intravenously administered monoclonal antibody that targets IGF-1R. Tepezza® is marketed in the United States by Horizon, which was acquired by Amgen in October 2023.
Added
STRIVE is a global study of veligrotug in TED patients that utilizes broad inclusion criteria (e.g., any severity or duration of disease) and is randomized 3:1 (10 mg/kg IV with an active control of 3 mg/kg IV).
Removed
The results from clinical trials of teprotumumab conducted by Horizon provide strong clinical validation linking the targeting of IGF-1R to clinical benefit in patients with TED. However, clinical trials evaluating teprotumumab in patients with TED reported to date used a single dosing regimen, providing little guidance as to the optimal dosing required for clinical activity in TED.
Added
In January 2025, we completed enrollment in STRIVE with a total of 231 patients, exceeding the enrollment target of 212 due to patient demand. We have also completed enrollment of the open label extension study for non-responding patients in THRIVE and THRIVE-2.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−0 removed2 unchanged
Biggest changeWe do not believe that inflation had a material effect on our business, financial condition or consolidated results of operations during the years ended December 31, 2023 and 2022. ITEM 8.
Biggest changeWe do not believe that inflation had a material effect on our business, financial condition or consolidated results of operations during the years ended December 31, 2024 and 2023. ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The financial statements and supplemental data required by this item are set forth on the pages indicated in Part IV, Item 15(a)(1) of this Annual Report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The financial statements and supplemental data required by this item are set forth on the pages indicated in Part IV, Item 15(a)(1) of this Annual Report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. 91
A change in prevailing interest rates, and/or credit risk, may cause the fair value of the investment to fluctuate. The average duration of all of our available-for-sale investments held as of December 31, 2023, was less than 12 months.
A change in prevailing interest rates, and/or credit risk, may cause the fair value of the investment to fluctuate. The average duration of all of our available-for-sale investments held as of December 31, 2024, was less than 12 months.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Interest Rate Fluctuation Risk As of December 31, 2023, we had cash, cash equivalents and short-term investments of $477.4 million, consisting of money market accounts, corporate bonds, and U.S. Treasury Securities. The primary objectives of our investment activities are to preserve principal, provide liquidity and maximize income without significantly increasing risk.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Interest Rate Fluctuation Risk As of December 31, 2024, we had cash, cash equivalents and short-term investments of $717.6 million, consisting of money market accounts, corporate bonds, and U.S. Treasury Securities. The primary objectives of our investment activities are to preserve principal, provide liquidity and maximize income without significantly increasing risk.

Other VRDN 10-K year-over-year comparisons