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What changed in Coherus Oncology, Inc.'s 10-K — 2023 vs 2024

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

+721 added−720 removedSource: 10-K (2025-03-17) vs 10-K (2024-03-15)

Top changes in Coherus Oncology, Inc.'s 2024 10-K

721 paragraphs added · 720 removed · 444 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

105 edited+69 added−82 removed168 unchanged
Biggest changeSuch consideration is subject to certain adjustments that will be finalized following the closing pursuant to the Purchase Agreement. ​ ​ License Agreement with Junshi Biosciences On February 1, 2021, we entered into the Collaboration Agreement with Junshi Biosciences for the co-development and commercialization of toripalimab, Junshi Biosciences’ anti-PD-1 antibody in the United States and Canada (the “Collaboration Agreement”). 10 Table of Contents Under the terms of the Collaboration Agreement, we paid $150.0 million upfront for exclusive rights to LOQTORZI in the United States and Canada, an option in these territories to Junshi Biosciences’ anti-TIGIT antibody CHS-006, an option in these territories to a next-generation engineered IL-2 cytokine, and certain negotiation rights to two undisclosed preclinical immuno-oncology drug candidates.
Biggest changeUnder the terms of the Collaboration Agreement, we paid $150.0 million upfront for exclusive rights to LOQTORZI in the United States and Canada, an option in these territories to Junshi Biosciences’ anti-TIGIT antibody CHS-006, an option in these territories to a next-generation engineered IL-2 cytokine, and certain negotiation rights to two undisclosed preclinical immuno-oncology drug candidates.
LOQTORZI is an anti-PD-1 antibody that we developed in collaboration with Junshi Biosciences. We announced the launch of LOQTORZI in the U.S. on January 2, 2024.
LOQTORZI is an anti-PD-1 antibody that we developed in collaboration with Junshi Biosciences. We announced the launch of LOQTORZI in the U.S. on January 2, 2024.
Our agreement with Orox will expire on a product-by-product and country-by-country basis ten years after regulatory approval of such product in such country, subject to automatic three-year extensions unless Orox notifies us in writing at least 18 months in advance of the date upon which the term would otherwise expire that it does not wish to extend the term for such product in such country.
Our agreement with Orox / Gador will expire on a product-by-product and country-by-country basis ten years after regulatory approval of such product in such country, subject to automatic three-year extensions unless Orox notifies us in writing at least 18 months in advance of the date upon which the term would otherwise expire that it does not wish to extend the term for such product in such country.
This team is responsible for negotiating payer coverage with national and regional health plans and pension benefit managers (via a team of National Account Directors), servicing account specific questions regarding the billing, coding and reimbursement of Coherus’ products (via a team of Field Reimbursement Managers), and managing our Coherus Solutions patient services hub which provides product specific coverage, reimbursement and co-pay support for patients and providers.
This team is responsible for negotiating payer coverage with national and regional health plans and pension benefit managers (via a team of National Account Directors), servicing account specific questions regarding the billing, coding and reimbursement of our products (via a team of Field Reimbursement Managers), and managing our Coherus Solutions patient services hub which provides product specific coverage, reimbursement and co-pay support for patients and providers.
Pharmaceutical Coverage, Pricing and Reimbursement In the United States and other countries, sales of UDENYCA, YUSIMRY, LOQTORZI and any other products for which we receive regulatory approval for commercial sale will depend in part on the availability of coverage and reimbursement from third-party payers, including government health administrative authorities, managed care providers, private health insurers and other organizations.
Pharmaceutical Coverage, Pricing and Reimbursement In the United States and other countries, sales of UDENYCA and LOQTORZI and any other products for which we receive regulatory approval for commercial sale will depend in part on the availability of coverage and reimbursement from third-party payers, including government health administrative authorities, managed care providers, private health insurers and other organizations.
Specifically, under regulations issued by the FDA, a combination product may be: ● a product composed of two or more regulated components that are physically, chemically, or otherwise combined or mixed and produced as a single entity; ● two or more separate products packaged together in a single package or as a unit and composed of drug and device products, device and biological products, or biological and drug products; 18 Table of Contents ● a drug, or device, or biological product packaged separately that according to its investigational plan or proposed labeling is intended for use only with an approved individually specified drug, or device, or biological product where both are required to achieve the intended use, indication, or effect and where upon approval of the proposed product the labeling of the approved product would need to be changed, e.g., to reflect a change in intended use, dosage form, strength, route of administration, or significant change in dose; or ● any investigational drug, or device, or biological product packaged separately that according to its proposed labeling is for use only with another individually specified investigational drug, device, or biological product where both are required to achieve the intended use, indication, or effect.
Specifically, under regulations issued by the FDA, a combination product may be: ● a product composed of two or more regulated components that are physically, chemically, or otherwise combined or mixed and produced as a single entity; ● two or more separate products packaged together in a single package or as a unit and composed of drug and device products, device and biological products, or biological and drug products; 17 Table of Contents ● a drug, or device, or biological product packaged separately that according to its investigational plan or proposed labeling is intended for use only with an approved individually specified drug, or device, or biological product where both are required to achieve the intended use, indication, or effect and where upon approval of the proposed product the labeling of the approved product would need to be changed, e.g., to reflect a change in intended use, dosage form, strength, route of administration, or significant change in dose; or ● any investigational drug, or device, or biological product packaged separately that according to its proposed labeling is for use only with another individually specified investigational drug, device, or biological product where both are required to achieve the intended use, indication, or effect.
Human clinical trials for novel drugs and biologics are typically conducted in three sequential phases that may overlap or be combined. ● Phase 1—The product candidate is initially introduced into healthy human subjects and tested for safety, dosage tolerance, absorption, metabolism, distribution and elimination.
Human clinical trials for novel drugs and biologics are typically conducted in three sequential phases that may overlap or be combined. ● Phase 1—The product candidate is initially introduced into healthy human subjects and tested for safety, dosage tolerance, optimal dosage, absorption, metabolism, distribution and elimination.
Decreases in third-party reimbursement for UDENYCA, YUSIMRY, LOQTORZI or other products for which we receive regulatory approval or a decision by a third-party payer to not cover our products could reduce physician utilization of our products and have a material adverse effect on our sales, results of operations and financial condition.
Decreases in third-party reimbursement for UDENYCA and LOQTORZI or other products for which we receive regulatory approval or a decision by a third-party payer to not cover our products could reduce physician utilization of our products and have a material adverse effect on our sales, results of operations and financial condition.
We also have Performance Management Training and Interview Training programs for our managers. We have a highly collaborative, engaging company environment. ​ Additional Information We view our operations and measure our business as one reportable segment operating primarily in the United States. See “Note 1.
We also have Performance Management, Leadership and Interview Training programs for our managers. We have a highly collaborative, engaging company environment. ​ Additional Information We view our operations and measure our business as one reportable segment operating primarily in the United States. See “Note 1.
Under this agreement, Orox has an option, exercisable within a defined time period, to obtain an exclusive license to commercialize certain additional biosimilar products in the same field and territory. We are obligated to manufacture and supply licensed products to Orox.
Under this agreement, Orox / Gador has an option, exercisable within a defined time period, to obtain an exclusive license to commercialize certain additional biosimilar products in the same field and territory. We are obligated to manufacture and supply licensed products to Orox / Gador.
Either party may terminate the agreement for material breach by the other party that is not cured within a specified time period. Orox may terminate the Agreement for convenience on a product-by-product basis at any time upon 12-months prior written notice.
Either party may terminate the agreement for material breach by the other party that is not cured within a specified time period. Orox / Gador may terminate the agreement for convenience on a product-by-product basis at any time upon 12-months prior written notice.
Each party may terminate the agreement upon bankruptcy or insolvency of the other party, and we may terminate the agreement immediately upon written notice to Orox if Orox challenges the licensed patents or commits a breach of specified provisions of the agreement.
Each party may terminate the agreement upon bankruptcy or insolvency of the other party, and we may terminate the agreement immediately upon written notice to Orox / Gador if Orox / Gador challenges the licensed patents or commits a breach of specified provisions of the agreement.
The higher standard of interchangeability must be demonstrated by information sufficient to show that: ● the proposed product is biosimilar to the reference product; ● the proposed product is expected to produce the same clinical result as the reference product in any given patient; and 17 Table of Contents ● for a product that is administered more than once to an individual, the risk to the patient in terms of safety or diminished efficacy of alternating or switching between the biosimilar and the reference product is no greater than the risk of using the reference product without such alternation or switch.
The higher standard of interchangeability must be demonstrated by information sufficient to show that: ● the proposed product is biosimilar to the reference product; ● the proposed product is expected to produce the same clinical result as the reference product in any given patient; and 16 Table of Contents ● for a product that is administered more than once to an individual, the risk to the patient in terms of safety or diminished efficacy of alternating or switching between the biosimilar and the reference product is no greater than the risk of using the reference product without such alternation or switch.
We are eligible to receive from Orox a share of gross profits in the low twenty percent range from the sale of licensed products, on a product-by-product basis.
We are eligible to receive from Orox / Gador a share of gross profits in the low twenty percent range from the sale of licensed products, on a product-by-product basis.
Pursuant to the terms and subject to the conditions set forth in the Purchase Agreement, on March 1, 2024, we completed the divestiture of our CIMERLI ophthalmology franchise through the sale of our subsidiary, Coherus Ophthalmology LLC, to Sandoz for upfront, all-cash consideration of $170.0 million plus an additional $17.8 million for CIMERLI product inventory and prepaid manufacturing assets.
Pursuant to the terms and subject to the conditions set forth in the CIMERLI Purchase Agreement, on March 1, 2024, we completed the divestiture of our CIMERLI ophthalmology franchise through the sale of our subsidiary, Coherus Ophthalmology LLC (“Coherus Ophthalmology”), to Sandoz for upfront, all-cash consideration of $170.0 million plus an additional $17.8 million for CIMERLI product inventory and prepaid manufacturing assets.
In the case of some therapeutic candidates for severe or life-threatening diseases, such as cancer, especially when the product candidate may be inherently too toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients. ● Phase 2—Clinical trials are performed on a limited patient population intended to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage. ● Phase 3—Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical study sites.
In the case of some therapeutic candidates for severe or life-threatening diseases, such as cancer, especially when the product candidate may be inherently too toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients. ● Phase 2—Clinical trials are performed on a limited patient population intended to identify possible adverse effects and safety risks and to preliminarily evaluate the efficacy of the product for specific targeted diseases. ● Phase 3—Clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population at geographically dispersed clinical study sites.
By the end of 2032, we expect them to be prescribed mostly in the large and commercially lucrative locoregionally advanced and recurrent or metastatic first-line setting. Immuno-oncology agents, and the PD-1/PD-L1 class in particular, have shifted the treatment paradigm across a broad range of tumors, and across the continuum of cancer settings (metastatic to early stage).
By the end of 2033, we expect them to be prescribed mostly in the large and commercially lucrative locoregionally advanced and recurrent or metastatic first-line setting. Immuno-oncology agents, and the PD-1/PD-L1 class in particular, have shifted the treatment paradigm across a broad range of tumors, and across the continuum of cancer settings (metastatic to early stage).
A number of states have either implemented or are considering implementation of drug price transparency legislation. Requirements under such laws include advance notice of planned price increases, reporting price increase amounts and factors considered in taking such increases, wholesale acquisition cost information disclosure to prescribers, purchasers, and 22 Table of Contents state agencies, and new product notice and reporting.
A number of states have either implemented or are considering implementation of drug price transparency legislation. Requirements under such laws include advance notice of planned price increases, reporting price increase amounts and factors considered in taking such increases, wholesale acquisition cost information disclosure to prescribers, purchasers, and 21 Table of Contents state agencies, and new product notice and reporting.
On October 27, 2023, we announced that LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced nasopharyngeal carcinoma (NPC), and as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
On October 27, 2023, we announced that LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced NPC, and as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
On Dec. 11, 2023 we announced that the NCCN updated the clinical practice guidelines for NPC to include LOQTORZI as a preferred, category 1 first-line treatment option for adults with metastatic or recurrent locally advanced NPC when used in combination with cisplatin and gemcitabine.
On December 11, 2023 we announced that NCCN updated the clinical practice guidelines for NPC to include LOQTORZI as a preferred, category 1 first-line treatment option for adults with metastatic or recurrent locally advanced NPC when used in combination with cisplatin and gemcitabine.
We also grant equity compensation awards that vest over time through our long-term incentive plan to employees to align such employees’ incentives with our long-term strategic objectives and the interests of our stockholders. ​ We also offer competitive benefits to our employees, including paid vacation and holidays, family leave, disability insurance, life insurance, healthcare, dental and vision coverage, dependent care flexible spending accounts, a 401(k) plan with a company match, and an Employee Stock Purchase Plan.
We also grant equity compensation awards that vest over time through our long-term incentive plan to employees to align such employees’ incentives with our long-term strategic objectives and the interests of our stockholders. ​ 22 Table of Contents We also offer competitive benefits to our employees, including paid vacation and holidays, family leave, disability insurance, life insurance, healthcare, dental and vision coverage, dependent care flexible spending accounts, a 401(k) plan with a company match, and an Employee Stock Purchase Plan.
Any waiver of our Code of Business Conduct and Ethics for any of our directors or executive officers must be disclosed on a Current Report on Form 8-K within four business days, or such shorter period as may be required under applicable law. ​ 24 Table of Contents ​
Any waiver of our Code of Business Conduct and Ethics for any of our directors or executive officers must be disclosed on a Current Report on Form 8-K within four business days, or such shorter period as may be required under applicable law. ​ 23 Table of Contents ​
Regulatory authorities may withdraw product approvals, 19 Table of Contents request product recalls or impose marketing restrictions through labeling changes or product removals if a company fails to comply with regulatory standards, if it encounters problems following initial marketing or if previously unrecognized problems are subsequently discovered.
Regulatory authorities may withdraw product approvals, 18 Table of Contents request product recalls or impose marketing restrictions through labeling changes or product removals if a company fails to comply with regulatory standards, if it encounters problems following initial marketing or if previously unrecognized problems are subsequently discovered.
Noncompliance with such beneficiary inducement provision of the federal Civil Monetary 20 Table of Contents Penalties Law can result in civil money penalties for each wrongful act, assessment of three times the amount claimed for each item or service and exclusion from the federal healthcare programs.
Noncompliance with such beneficiary inducement provision of the federal Civil Monetary 19 Table of Contents Penalties Law can result in civil money penalties for each wrongful act, assessment of three times the amount claimed for each item or service and exclusion from the federal healthcare programs.
The SEC maintains a website (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Such filings are placed on our website as soon as reasonably possible after they are filed with the SEC.
The SEC maintains a website (https://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Such filings are placed on our website as soon as reasonably possible after they are filed with the SEC.
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount program with a new manufacturer discounting program (which began in 2025).
Third- 21 Table of Contents party payers are increasingly examining the medical necessity and cost effectiveness of medical products and services in addition to safety and efficacy and, accordingly, significant uncertainty exists as to the reimbursement status of newly approved therapeutics.
Third-party payers 20 Table of Contents are increasingly examining the medical necessity and cost effectiveness of medical products and services in addition to safety and efficacy and, accordingly, significant uncertainty exists as to the reimbursement status of newly approved therapeutics.
The central focus of an IND submission is on the general investigational plan and the protocol(s) for human studies, 14 Table of Contents although the IND must also include the results of preclinical testing and animal testing assessing the toxicology, pharmacokinetic, pharmacology and pharmacodynamic characteristics of the product along with other information, including information about product chemistry, manufacturing and controls and a proposed clinical trial protocol.
The central focus of an IND submission is on the general investigational plan and the protocol(s) for human studies, although the IND must also include the results of preclinical testing and animal testing assessing the toxicology, pharmacokinetic, pharmacology and pharmacodynamic characteristics of the product along with other information, including information about product chemistry, manufacturing and controls and a proposed clinical trial protocol.
In the United States, a patent’s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the United States Patent and Trademark Office (“USPTO”) in examining and granting a patent or may be shortened if a patent is terminally disclaimed over a commonly owned patent or a patent naming a common inventor and having an earlier expiration date.
In the United States, a patent’s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the United States Patent and Trademark Office (“USPTO”) in examining and 11 Table of Contents granting a patent or may be shortened if a patent is terminally disclaimed over a commonly owned patent or a patent naming a common inventor and having an earlier expiration date.
We are obligated to develop licensed products and achieve regulatory approval for such products outside of the Caribbean and Latin American countries covered by the agreement by specified dates in order to support Orox’s activities under the agreement in its licensed territory.
We are obligated to develop licensed products and achieve regulatory approval for such products outside of the Caribbean and Latin American countries covered by the agreement by specified dates in order to support Orox / Gador’s activities under the agreement in its licensed territory.
For a discussion of risks related to our competition, please see “Risk Factors— Risks Related to Competitive Activity.” Collaboration and License Agreements Distribution Agreement with Orox Pharmaceuticals B.V. (“Orox”) In December 2012, we entered into a distribution agreement with Orox, for the commercialization of biosimilar versions of our internally developed biosimilars.
For a discussion of risks related to our competition, please see “Risk Factors— Risks Related to Competitive Activity.” Collaboration and License Agreements Distribution Agreement with Orox Pharmaceuticals B.V. (“Orox”) / Laboratorio Gador S.A. (“Gador”) In December 2012, we entered into a distribution agreement with Orox / Gador, for the commercialization of biosimilar versions of our internally developed biosimilars.
Additionally, we offer an Employee Assistance Program (“EAP”) that includes professional support for employees to balance the stress of personal and professional demands. ​ 23 Table of Contents Inclusion and Diversity ​ People are a critical component of our efforts to drive growth and deliver value for stockholders.
Additionally, we offer an Employee Assistance Program that includes professional support for employees to balance the stress of personal and professional demands. ​ Inclusion and Diversity ​ People are a critical component of our efforts to drive growth and deliver value for stockholders.
To help reduce the risk of the introduction of adventitious agents with use of 15 Table of Contents biological products, the PHSA emphasizes the importance of manufacturing control for products whose attributes cannot be precisely defined.
To help reduce the risk of the introduction of adventitious agents with use of biological products, the PHSA emphasizes the importance of manufacturing control for products whose attributes cannot be precisely defined.
Healthcare Reform, including the IRA The United States federal and state governments continue to propose and pass legislation designed to regulate the healthcare industry, including legislation that seeks to indirectly or directly regulate pharmaceutical drug pricing. Most significantly, on August 16, 2022, the IRA was signed into law.
Healthcare Reform, including the Inflation Reduction Act of 2022 (the “IRA”) The United States federal and state governments continue to propose and pass legislation designed to regulate the healthcare industry, including legislation that seeks to indirectly or directly regulate pharmaceutical drug pricing. Most significantly, on August 16, 2022, the IRA was signed into law.
LOQTORZI, following its recent launch, faces a competitive market in the United States where a number of anti-PD-1 or PD-L1 antibody drugs have been approved by the FDA including the following marketed products from several competitors: Keytruda® (pembrolizumab) from Merck & Company, Inc. (“Merck”), Opdivo® (nivolumab) from Bristol-Myers Squibb Company (“BMS”), Tecentriq® (atezolizumab) from Genentech, Inc.
LOQTORZI faces a competitive market in the United States where a number of anti-PD-1 or PD-L1 antibody drugs have been approved by the FDA, although not in NPC, including the following marketed products from several competitors: Keytruda® (pembrolizumab) from Merck & Co., Inc. (“Merck”), Opdivo® (nivolumab) from Bristol-Myers Squibb Company (“BMS”), Tecentriq® (atezolizumab) from Genentech, Inc.
LOQTORZI is a next-generation programmed death receptor-1 (“PD-1”) monoclonal antibody that blocks PD-1 ligands PD-L1 and PD-L2 with high potency at a unique site on the PD-1 receptor, enabling the immune system to activate and kill the tumor.
LOQTORZI is a novel next-generation PD-1 monoclonal antibody that blocks PD-1 ligands PD-L1 and PD-L2 with high potency at a unique site on the PD-1 receptor, enabling the immune system to activate and kill the tumor.
GSK4381562 is an antibody targeting CD112R, also known as PVRIG, an inhibitory protein expressed on natural killer (“NK”) and T cells. GSK4381562 is designed to block the interaction of CD112R with CD112, its binding partner that is expressed on tumor cells.
GSK4381562 is an investigational antibody targeting CD112R (“PVRIG”), an inhibitory protein expressed on natural killer (“NK”) and T cells. GSK4381562 is designed to block the interaction of PVRIG with CD112, its binding partner that is expressed on tumor cells.
Any payments payable to Adimab as a result of any product candidates being developed pursuant to the license agreement between Surface and GSK, dated December 16, 2020, which was subsequently amended in August 2021 (as amended, the “GSK Agreement”), will be payable to Adimab directly by GSK.
Any payments payable to Adimab as a result of any product candidates being developed pursuant to the license agreement between Surface and GSK, dated December 16, 2020, which was subsequently amended in August 2021 (as amended, the “GSK Agreement”), will be payable to Adimab directly by GSK. 10 Table of Contents GSK Out-licensing Agreement In December 2020, Surface entered into the GSK Agreement.
Our most recent charter for our audit, compensation, and nominating and corporate governance committees and our Code of Business Conduct and Ethics are available on our website as well. Any waiver of our Code of Business Conduct and Ethics may be made only by our board of directors.
Our most recent charter for our audit, compensation, and nominating and corporate governance committees and our Code of Business Conduct and Ethics are available on our website as well at https://www.coherus.com. Any waiver of our Code of Business Conduct and Ethics may be made only by our board of directors (“Board”).
As of December 31, 2023, we had 306 full-time and part-time employees. All were located in the United States and none of our employees were represented by a labor union. We have not experienced any work stoppages and believe we have good relations with our employees and contractors.
The Plan was completed in 2024. As of December 31, 2024, we had 228 full-time and part-time employees. All were located in the United States and none of our employees were represented by a labor union. We have not experienced any work stoppages and believe we have good relations with our employees and contractors.
Casdozokitug is currently in two on-going clinical studies, a Phase 1/2 study in advanced solid tumors (clinicaltrials.gov identifier# NCT04374877) and a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861). ● CHS-114 (formerly SRF114), is an investigational highly specific human afucosylated IgG1 monoclonal antibody selectively targeting CCR8, a chemokine receptor highly expressed on Treg cells in the TME.
Casdozokitug is currently in three on-going clinical studies, including a Phase 1/2 study in advanced solid tumors (clinicaltrials.gov identifier# NCT04374877), a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861) and a randomized Phase 2 study in HCC evaluating casdozokitug in combination with toripalimab and bevacizumab (clinicaltrials.gov identifier# NCT06679985). ● CHS-114 (formerly SRF114), is an investigational highly specific human afucosylated IgG1 monoclonal antibody selectively targeting CCR8, a chemokine receptor highly expressed on Treg cells in the TME.
Adimab Development and Option Agreement In October 2018, Surface and Adimab LLC (“Adimab”), entered into an amended and restated development and option agreement, (as amended by the amendments dated as of December 16, 2020, June 1, 2022 and July 18, 2022, “the A&R Adimab Agreement”), which amended and restated the development and option agreement with Adimab dated July 2014, as amended, (“the Original Adimab Agreement”), for the discovery and optimization of proprietary antibodies as potential therapeutic product candidates.
(“Surface”), which we acquired in September 2023, and Adimab LLC (“Adimab”), entered into an amended and restated development and option agreement, (as amended by the amendments dated as of December 16, 2020, June 1, 2022 and July 18, 2022, the “A&R Adimab Agreement”), which amended and restated the development and option agreement with Adimab dated July 2014, as amended, (the “Original Adimab Agreement”), for the discovery and optimization of proprietary antibodies as potential therapeutic product candidates.
On January 19, 2024, we entered into a Purchase and Sale Agreement (the “Purchase Agreement”) by and between us and Sandoz Inc., a Delaware corporation (“Sandoz”).
On January 19, 2024, we entered into a Purchase and Sale Agreement (the “CIMERLI Purchase Agreement”) by and between us and Sandoz.
Under this agreement, we granted to Orox an exclusive license to commercialize UDENYCA in Latin America, except Brazil and Argentina, and YUSIMRY and CHS-0214 (our etanercept (Enbrel ® ) biosimilar candidate, for which we discontinued development in 2020) in Latin America, except Brazil.
Under this agreement, we granted to Orox / Gador an exclusive license to commercialize UDENYCA in Latin America, except Brazil and Argentina, and YUSIMRY (which we sold in 2024) and CHS-0214 (which we discontinued development in 2020) in Latin America, except Brazil.
We are enrolling patients with advanced solid tumors in North America in a clinical trial evaluating safety and pharmacokinetics of CHS-114 (clinicaltrials.gov identifier# NCT05635643).
We are enrolling patients with advanced solid tumors and HNSCC in the U.S. in a clinical trial evaluating safety and pharmacokinetics of CHS-114 with and without LOQTORZI (clinicaltrials.gov identifier# NCT05635643).
The term of individual patents depends upon the legal term of the patents in countries in which they are obtained. In most countries, including the United States, the patent term is generally 20 years from the earliest date of filing a non-provisional patent application in the applicable country.
In most countries, including the United States, the patent term is generally 20 years from the earliest date of filing a non-provisional patent application in the applicable country.
Casdozokitug is currently in two on-going clinical studies, a Phase 1/2 study in patients with advanced solid tumors (clinicaltrials.gov identifier# NCT04374877) and a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861).
Casdozokitug is currently in three on-going clinical studies, including a Phase 1/2 study in patients with advanced solid tumors, including combination with toripalimab in non-small cell lung cancer (clinicaltrials.gov identifier# NCT04374877), and a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861).
(“Genentech”), Imfinzi® (durvalumab) from AstraZeneca plc (“AstraZeneca”), Bavencio® (avelumab) from EMD Serono Inc. and Pfizer Inc. (“Pfizer”), Libtayo® (cemiplimab-rwlc) from Regeneron Pharmaceuticals, Inc. (“Regeneron”) and Sanofi S.A. (“Sanofi”), and Jemperli (dostarlimab-gxly) from GlaxoSmithKline plc (“GlaxoSmithKline”).
(“Genentech”), Imfinzi® (durvalumab) from AstraZeneca plc (“AstraZeneca”), Bavencio® (avelumab) from EMD Serono Inc. and Pfizer, Libtayo® (cemiplimab-rwlc) from Regeneron Pharmaceuticals, Inc. (“Regeneron”), Jemperli (dostarlimab-gxly) from GlaxoSmithKline plc (“GlaxoSmithKline”) and TEVIMBRA® (tislelizumab-jsgr) from BeiGene, Ltd.
Due to the uncertainty of pharmaceutical development and the historical failure rates generally associated with drug development, we may not receive any milestone payments or any royalty payments under the GSK Agreement. We did not recognize license-related revenue under the GSK Agreement from September 8, 2023 through December 31, 2023.
Due to the uncertainty of pharmaceutical development and the historical failure rates generally associated with drug development, we may not receive any milestone payments or any royalty payments under the GSK Agreement. We have not recognized license-related revenue under the GSK Agreement to date.
Further, the FDA may require that certain contraindications, warnings or precautions be included in the product labeling. The FDA may impose restrictions and conditions on product distribution, prescribing, or dispensing in the form of a risk management plan, or otherwise limit the scope of any approval.
The FDA may impose restrictions and conditions on product distribution, prescribing, or dispensing in the form of a risk management plan, or otherwise limit the scope of any approval.
Due to its immune regulatory nature, there is a rationale for inhibiting IL-27 to treat cancer, as this approach will influence the activity of multiple types of immune cells that are necessary to recognize and attack a tumor. Casdozokitug received orphan drug designation and fast track designation from the FDA for the treatment of HCC in November 2020.
Due to its immune regulatory nature, there is a rationale for inhibiting IL-27 to treat cancer, as this approach will influence the activity of multiple types of immune cells that are necessary to recognize and attack a tumor.
We react to emergencies on an ongoing basis to protect our employees. ​ Training, Development and Engagement ​ Through our online learning platform, we deliver a variety of required learning modules, including those modules tied to our Code of Business Conduct, unlawful harassment and anti-corruption policies, which are completed periodically by all team members.
We have an incident reporting plan to respond to injuries and emergencies on an ongoing basis to protect our employees and comply with all Occupational Safety and Health Administration requirements. ​ Training, Development and Engagement ​ Through our online learning platform, we deliver a variety of required learning modules, including those modules tied to our Code of Business Conduct, cybersecurity, unlawful harassment, workplace violence prevention and anti-corruption policies, which are completed periodically by all team members.
The lead clinical stage product candidate from our acquisition of Surface (the “Surface Acquisition”) is casdozokitug (CHS-388, formerly SRF388), an investigational antibody targeting interleukin 27 (“IL-27”) , an immune regulatory cytokine, or protein that is overexpressed in certain cancers, including hepatocellular, lung and renal cell carcinoma.
Our lead clinical stage product candidate is casdozokitug (CHS-388, formerly SRF388), an investigational antagonist antibody targeting IL-27, an immune regulatory cytokine, that is overexpressed in certain cancers, including hepatocellular, lung and renal cell carcinoma.
In addition to LOQTORZI, multiple other competitors are seeking to develop and approve novel anti-PD-1 or PD-L1 antibody drugs in the United States in the coming years, including but not limited to BeiGene, Ltd. (in collaboration with Novartis International AG (“Novartis”)).
In addition to LOQTORZI, multiple other competitors are seeking to develop and approve novel anti-PD-1 or PD-L1 antibody drugs in the United States in the coming years, including but not limited to camrelizumab from Elevar Therapeutics, Inc. (in collaboration with Jiangsu Hengrui Pharmaceuticals Co., Ltd.).
In addition, the FDA may require post marketing clinical trials, sometimes referred to as “Phase 4” clinical trials, designed to further assess a biological product’s safety and effectiveness, and testing and surveillance programs to monitor the safety of approved products that have been commercialized.
In addition, the FDA may require post marketing clinical trials, sometimes referred to as “Phase 4” clinical trials, designed to further assess a biological product’s safety and effectiveness, and testing and surveillance programs to monitor the safety of approved products that have been commercialized. 14 Table of Contents Expedited Development and Review Programs The FDA has a number of programs intended to expedite the development or review of a marketing application for an investigational drug or biologic.
The A&R Adimab Agreement, among other things, extended the discovery term of the Original Adimab Agreement, provided access to additional antibodies, and expanded our right to evaluate and use antibodies that were modified or derived using Adimab technology for diagnostic purposes. Upon our selection of a target, we and Adimab will initiate a research plan and the discovery term begins.
The A&R Adimab Agreement, among other things, provided access to additional antibodies and expanded our right to evaluate and use antibodies that were modified or derived using Adimab technology for diagnostic purposes.
We will be required to use commercially reasonable efforts to develop, seek market approval of, and commercialize at least one antibody against the target covered by the Commercialization Option in specified markets upon the exercise of a Commercialization Option. 11 Table of Contents Under the A&R Adimab Agreement, we are obligated to make milestone payments and to pay specified fees upon the exercise of the Research Option or Commercialization Option.
We will be required to use commercially reasonable efforts to develop, seek market approval of, and commercialize at least one antibody against the target covered by the Commercialization Option in specified markets upon the exercise of a Commercialization Option.
For a discussion of risks related to our sources and availability of supplies, please see “Risk Factors—Risks Related to Our Ability to Hire and Retain Highly Qualified Personnel” and “Risk Factors—Risks Related to Manufacturing and Supply Chain.” Competition While we believe that our biologics platform, knowledge, experience and scientific resources provide us with competitive advantages, we face competition from many different sources.
For a discussion of risks related to manufacturing our products and our reliance on third parties, please see “Risk Factors— Risks Related to Manufacturing and Supply Chain” and “Risk Factors—Risks Related to Reliance on Third Parties.” Competition While we believe that our knowledge, experience and scientific resources provide us with competitive advantages, we face competition from many different sources.
Another product, CIMERLI® (ranibizumab-eqrn), was approved by the FDA in August 2022 as a biosimilar product interchangeable with Lucentis (ranibizumab injection) for the treatment of neovascular (wet) age-related macular degeneration, macular edema following retinal vein occlusion, diabetic macular edema, diabetic retinopathy, and myopic choroidal neovascularization. We launched CIMERLI commercially in the United States in October 2022.
(“Sandoz”) pursuant to the sale of our CIMERLI ophthalmology franchise (the “CIMERLI Sale” and, together with the YUSIMRY Sale, the “Sale Transactions”) ● CIMERLI (ranibizumab-eqrn), a Lucentis biosimilar, was approved by the FDA on August 2, 2022 for the treatment of neovascular (wet) age-related macular degeneration, macular edema following retinal vein occlusion, diabetic macular edema, diabetic retinopathy, and myopic choroidal neovascularization and we launched CIMERLI commercially in the United States on October 3, 2022.
On October 27, 2023, we announced that LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced nasopharyngeal carcinoma (“NPC”), and as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
Food and Drug Administration (“FDA”) in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced nasopharyngeal carcinoma (“NPC"), and as monotherapy for the treatment of adults with recurrent unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
We expect any products that we develop and commercialize directly or with partners to compete on the basis of, among other things, price and the availability of reimbursement from government and other third-party payers.
(“AbbVie”), Bayer AG, F. Hoffmann-La Roche Ltd, Amgen Inc. (“Amgen”), LaNova Medicines Ltd. and Nanjing Immunophage Biotech Co., Ltd. We expect any products that we develop and commercialize directly or with partners to compete on the basis of, among other things, price and the availability of reimbursement from government and other third-party payers.
UDENYCA ONBODY became commercially available in the first quarter of 2024. ● LOQTORZI was developed for its ability to block PD-1 interactions with its ligands, PD-L1 and PD-L2, by binding to the FG loop on the PD-1 receptor.
We anticipate the transactions contemplated by the UDENYCA Purchase Agreement to close late in the first quarter or early in the second quarter of 2025. ● LOQTORZI was developed for its ability to block PD-1 interactions with its ligands, PD-L1 and PD-L2, by binding to the FG loop on the PD-1 receptor.
If during the 30-day waiting period the FDA raises concerns or questions related to the proposed clinical studies, the sponsor and the FDA must resolve any outstanding concerns or questions before clinical studies can begin. If the FDA has neither commented on nor questioned the IND within this 30-day period, the clinical trial proposed in the IND may begin.
If during the 30-day waiting period the FDA raises concerns or 12 Table of Contents questions related to the proposed clinical studies, the sponsor and the FDA must resolve any outstanding concerns or questions before clinical studies can begin.
Our guiding principles are anchored on the goals of being able to recruit, incentivize, retain and integrate talented employees who can develop, implement, and drive long-term value creation strategies. Compensation and Benefits ​ We believe our base salaries are fair and competitive with the external labor markets in which our employees work and are reviewed on a regular basis.
Our guiding principles are anchored on the goals of being able to recruit, incentivize, retain and integrate talented employees who can develop, implement, and drive long-term value creation strategies.
In March 2022, we paid $35.0 million for the exercise of our option to license the TIGIT Program (as defined in the Collaboration Agreement). Subsequent joint development consistent with the Collaboration Agreement commenced. On January 10, 2024, we announced that we had delivered a notice of termination of the TIGIT Program to Junshi Biosciences pursuant to the Collaboration Agreement.
On January 10, 2024, we announced that we had delivered a notice of termination of the TIGIT Program (as defined in the Collaboration Agreement) to Junshi Biosciences pursuant to the Collaboration Agreement.
The IRA permits the Secretary of the Department of Health and Human Services (“HHS”) to implement many of these provisions through guidance, as opposed to regulation, for the initial years. On August 29, 2023, HHS announced the list of the first ten drugs that will be subject to price negotiations.
The IRA permits the Secretary of the Department of Health and Human Services (“HHS”) to implement many of these provisions through guidance, as opposed to regulation, for the initial years. HHS has issued and will continue to issue guidance implementing the IRA.
In addition to the field facing teams, Coherus has a team of strategic account managers that support the portfolio of products and work directly with the largest accounts including group purchasing organizations, integrated delivery networks, and large clinic customers. We have an experienced market access and patient services team that support the portfolio of Coherus’ products.
We will maintain a focused set of field facing sales representatives and strategic account managers to support LOQTORZI and work directly with the largest accounts including group purchasing organizations, integrated delivery networks, and large clinic customers. 7 Table of Contents We have an experienced market access and patient services team that will continue to support LOQTORZI and a set of personnel will also transfer to Accord to ensure the continued success of UDENYCA.
In response to the COVID-19 pandemic, we implemented additional safety measures for the protection of our employees, including work-from-home measures for applicable employees and additional cleaning and protective measures. We require that all employees are fully vaccinated for COVID-19 and recommend they get all booster shots recommended by the United States Centers of Disease Control and Prevention.
In response to the COVID-19 pandemic, we implemented additional safety measures for the protection of our employees, including work-from-home measures for applicable employees and additional cleaning and protective measures.
The additional milestone payments, option fee for the IL-2 cytokine and royalties are contingent upon future events and, therefore, will be recorded if and when it becomes probable that a milestone will be achieved, or when an option fee or royalties are incurred.
The accrued royalty obligation to Junshi Biosciences was $1.5 million as of December 31, 2024 and immaterial at December 31, 2023. The additional milestone payments and royalties are contingent upon future events and, therefore, will be recorded if and when it becomes probable that a milestone will be achieved, or when an option fee or royalties are incurred.
Patients treated with chemotherapy alone experience poor prognosis: only 20% experience one-year progression-free survival; up to 50% developed distant metastasis during their disease course; and low median overall survival (“OS”) of 29 months. Based on SEER and DRG models, we estimate that the annual drug-treatable population in the United States for NPC is approximately 2,000 patients annually.
Patients treated with chemotherapy alone experience poor prognosis: 6 Table of Contents only 20% experience one-year progression-free survival; up to 50% developed distant metastasis during their disease course; and low median overall survival (“OS”) of 29 months.
Clinical trials involve the administration of the investigational new drug or biologic to healthy volunteers or patients with the condition under investigation, all under the supervision of a qualified investigator.
If the FDA has neither commented on nor questioned the IND within this 30-day period, the clinical trial proposed in the IND may begin. Clinical trials involve the administration of the investigational new drug or biologic to healthy volunteers or patients with the condition under investigation, all under the supervision of a qualified investigator.
Under the United States settlement, our license period in the United States commenced on July 1, 2023. Settlement and License Agreements with Pfizer In October 2019, we entered into a license and settlement agreement with Pfizer relating to Coherus’ patents and applications for patents directed to Humira (adalimumab) formulations.
Settlement and License Agreements with Pfizer In October 2019, we entered into a license and settlement agreement with Pfizer relating to Coherus’ patents and applications for patents directed to Humira (adalimumab) formulations. ​ License Agreement with Junshi Biosciences On February 1, 2021, we entered into the Collaboration Agreement with Junshi Biosciences for the co-development and commercialization of toripalimab, Junshi Biosciences’ anti-PD-1 antibody in the United States and Canada (the “Collaboration Agreement”).
Immunology ● YUSIMRY, a biosimilar of Humira (adalimumab), is a monoclonal antibody that can bind to tumor necrosis factor (“TNF”). YUSIMRY provides certain therapeutic benefits for treatment of patients with certain inflammatory diseases characterized by increased production of TNF in the body, including rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, Crohn’s disease, psoriasis and ulcerative colitis.
YUSIMRY provides certain therapeutic benefits for treatment of patients with certain inflammatory diseases characterized by increased production of TNF in the body, including rheumatoid arthritis, juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, Crohn’s disease, psoriasis and ulcerative colitis. In December 2021, the FDA approved YUSIMRY, which we launched in the United States in July 2023.
Assuming successful completion of all required testing in accordance with all applicable regulatory requirements, detailed information regarding the investigational product is submitted to the FDA in the form of a BLA or NDA requesting approval to market the product for one or more indications.
Additionally, for both NDA and BLA products, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its proposed shelf-life. 13 Table of Contents Assuming successful completion of all required testing in accordance with all applicable regulatory requirements, detailed information regarding the investigational product is submitted to the FDA in the form of a BLA or NDA requesting approval to market the product for one or more indications.
Of this group, 60% have relapsed/metastatic disease and would be candidates for LOQTORZI. 40% have localized disease that can progress to relapsed/metastatic within a 12-24 month timeframe.
Based on SEER and DRG models, we estimate that the annual drug-treatable population in the United States for NPC is approximately 2,000 patients annually. Of this group, 60% have relapsed/metastatic disease and would be candidates for LOQTORZI. 40% have localized disease that can progress to relapsed/metastatic within a 12-24 month timeframe.
In 2022, sales of SCCHN therapies in the major pharmaceutical markets under study (United States, France, Germany, Italy, Spain, United Kingdom, and Japan) totaled $1.5 billion, and sales were expected to increase to almost $3.5 billion in 2032.
In 2023, sales of HNSCC therapies in the major pharmaceutical markets under study (United States, France, Germany, Italy, Spain, United Kingdom, and Japan) totaled $1.4 billion, and sales were expected to increase to almost $4.8 billion in 2033. Fueling this growth is the label expansion of pembrolizumab in the locoregionally advanced setting, and the expected approval of four new therapies.
In March 2022, Surface earned a $30.0 million milestone payment from GSK upon the dosing of the first patient in the Phase 1 trial of GSK4381562. We are eligible to receive up to $60.0 million in additional clinical milestones and $155.0 million in regulatory milestones. In addition, we may receive up to $485.0 million in sales milestone payments.
We are eligible to receive up to $60.0 million in additional clinical milestones and $155.0 million in regulatory milestones. In addition, we may receive up to $485.0 million in sales milestone payments.
Additionally, our commercial success may depend on our ability to obtain and maintain proprietary protection for our technologies where applicable and to prevent others from infringing our proprietary rights.
Additionally, our commercial success may depend on our ability to obtain and maintain proprietary protection for our technologies where applicable and to prevent others from infringing our proprietary rights. We seek to protect our proprietary technologies by, among other methods, filing United States and international patent applications on these technologies, inventions and improvements that are important to our business.
GSK is responsible for all costs 12 Table of Contents and expenses of such development, manufacturing and commercialization and is obligated to provide us with updates on its development, manufacturing and commercialization activities through the joint development committee.
GSK is responsible for all costs and expenses of such development, manufacturing and commercialization and is obligated to provide us with updates on its development, manufacturing and commercialization activities through the joint development committee. In March 2022, Surface earned a $30.0 million milestone payment from GSK upon the dosing of the first patient in the Phase 1 trial of GSK4381562.
Even if such additional information is submitted, the FDA may ultimately decide that the original BLA or NDA does not satisfy the criteria for approval. 16 Table of Contents Even if a product receives regulatory approval, the approval may be significantly limited to specific indications and dosages or the indications for use may otherwise be limited, which could restrict the commercial value of the product.
Even if a product receives regulatory approval, the approval may be significantly limited to specific indications and dosages or the indications for use may otherwise be limited, which could restrict the commercial value of the product. Further, the FDA may require that certain contraindications, warnings or precautions be included in the product labeling.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur determination of the expiration date of any patent in the United States or abroad that we consider relevant may be incorrect, which may negatively impact our ability to develop and market our products. ​ Our failure to identify and correctly interpret relevant patents may negatively impact our ability to develop and market our products. ​ If we are unable to obtain and maintain effective patent rights for our product candidates or any future product candidates, we may not be able to prevent competitors from using technologies we consider important in our successful development and commercialization of our product candidates, resulting in loss of any potential competitive advantage our patents may have otherwise afforded us. ​ While our principal focus in matters relating to intellectual property is to avoid infringing the valid and enforceable rights of third parties, we also rely upon a combination of patents, trade secret protection and confidentiality agreements to protect our own intellectual property related to our product candidates and development programs.
Biggest changeIf we are unable to obtain and maintain effective patent rights for our products and product candidates, we may not be able to prevent competitors from using technologies we consider important in our successful development and commercialization of our product candidates, resulting in loss of any potential competitive advantage our patents may have otherwise afforded us.
In cases where we are successful in obtaining additional regulatory approvals to market one or more of our product candidates, our revenue will be dependent, in part, upon the size of the markets in the territories for which we gain regulatory approval, the number of biosimilar or immuno-oncology competitors in such markets, the accepted price for the product, the ability to get reimbursement at any price, the nature and degree of competition from originators and other biosimilar or immuno-oncology companies (including competition from large pharmaceutical companies entering the biosimilar market or possessing large established positions in the immuno-oncology market that may be able to gain advantages in the sale of biosimilar or immuno-oncology products based on brand recognition and/or existing relationships with customers and payers) and whether we own (or have partnered with companies owning) the commercial rights for that territory.
In cases where we are successful in obtaining additional regulatory approvals to market one or more of our product candidates, our revenue will be dependent, in part, upon the size of the markets in the territories for which we gain regulatory approval, the number of biosimilar or immuno-oncology competitors in such markets, the accepted price for the product, the ability to get reimbursement at any price, the nature and degree of competition from originators and other biosimilar or immuno-oncology companies (including competition from large pharmaceutical companies entering the biosimilar market or possessing large established positions in the immuno-oncology market that may be able to gain advantages in the sale of biosimilar or immuno-oncology products based on brand recognition or existing relationships with customers and payers) and whether we own (or have partnered with companies owning) the commercial rights for that territory.
Disruptions at the FDA and other agencies may also slow the time necessary for new drugs and biologics or modifications to approved drugs and biologics to be reviewed and/or approved by necessary government agencies, which would adversely affect our business.
Disruptions at the FDA and other agencies may also slow the time necessary for new drugs and biologics or modifications to approved drugs and biologics to be reviewed or approved by necessary government agencies, which would adversely affect our business.
External developments can also result in changing preferences for convenient forms of administration of products that may impact our business. As new products are approved that compete with the reference product to our biosimilar products, sales of the reference originator product may be adversely impacted or rendered obsolete.
External developments can also result in changing preferences for convenient forms of administration of products that may impact our business. As new products are approved that compete with the reference product to our biosimilar product, sales of the reference originator product may be adversely impacted or rendered obsolete.
Any adverse developments affecting manufacturing operations for our products and product candidates, including due to sudden or long-term changes in weather patterns or conflicts in particular geographic areas, may result in shipment delays, inventory shortages, lot failures, withdrawals or recalls or other interruptions in the supply of our product candidates.
Any adverse developments affecting manufacturing operations for our products and product candidates, including due to sudden or long-term changes in weather patterns or conflicts in particular geographic areas, may result in shipment delays, inventory shortages, lot failures, withdrawals or recalls or other interruptions in the supply of our products and product candidates.
If any such inspection, audit or RRA identifies a failure to comply with applicable regulations or if a violation of our product specifications or applicable regulations occurs independent of such an inspection, audit or RRA, we or the relevant regulatory authority may require remedial measures that may be costly and/or time consuming for us or a third party to implement and that may include the temporary or permanent suspension of a clinical study or commercial sales or the temporary or permanent closure of a facility.
If any such inspection, audit or RRA identifies a failure to comply with applicable regulations or if a violation of our product specifications or applicable regulations occurs independent of such an inspection, audit or RRA, we or the relevant regulatory authority may require remedial measures that may be costly or time consuming for us or a third party to implement and that may include the temporary or permanent suspension of a clinical study or commercial sales or the temporary or permanent closure of a facility.
If we receive approval for our product candidates, regulatory agencies including the FDA and foreign regulatory agencies, regulations require that we report certain information about adverse medical events if those products may have caused or contributed to those adverse events.
For our products and If we receive approval for our product candidates, regulatory agencies including the FDA and foreign regulatory agencies, regulations require that we report certain information about adverse medical events if those products may have caused or contributed to those adverse events.
If we are sued for patent infringement, we would need to demonstrate that our product candidates, products or methods either do not infringe the patent claims of the relevant patent or that the patent claims are invalid and/or unenforceable, and we may not be able to do this. Proving that a patent is invalid or unenforceable is difficult.
If we are sued for patent infringement, we would need to demonstrate that our product candidates, products or methods either do not infringe the patent claims of the relevant patent or that the patent claims are invalid or unenforceable, and we may not be able to do this. Proving that a patent is invalid or unenforceable is difficult.
Third parties may submit applications for patent term extensions in the United States or other jurisdictions where similar extensions are available and/or Supplementary Protection Certificates in the E.U. states and Switzerland seeking to extend certain patent protection, which, if approved, may interfere with or delay the launch of one or more of our products.
Third parties may submit applications for patent term extensions in the United States or other jurisdictions where similar extensions are available or Supplementary Protection Certificates in the E.U. states and Switzerland seeking to extend certain patent protection, which, if approved, may interfere with or delay the launch of one or more of our products.
We expect that healthcare reform measures that may be adopted in the future may result in more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price that we receive for any approved product. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors.
We expect that healthcare reform measures that may be adopted in the future may result in more rigorous coverage criteria, new payment methodologies and additional downward pressure on the price that we receive for any approved product. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors.
In addition, geopolitical tensions or conflicts, such as the war between Russia and Ukraine or conflicts in the Middle East, may create a heightened risk of cyberattacks. We have also outsourced elements of our information technology infrastructure, and as a result a number of third-party vendors may or could have access to our Confidential Information.
In addition, geopolitical tensions or conflicts, such as the war between Russia and Ukraine or the conflicts in the Middle East, may create a heightened risk of cyberattacks. We have also outsourced elements of our information technology infrastructure, and as a result a number of third-party vendors may or could have access to our Confidential Information.
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 certain 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 certain materials or interrupt our business operations. Furthermore, environmental laws and regulations are complex, change frequently and have tended to become more stringent.
If we fail to compete effectively, we may not achieve significant market penetration and expansion. ● We face intense competition and rapid technological change and the possibility that our competitors may develop therapies that are similar, more advanced or more effective than ours, which may adversely affect our financial condition and our ability to successfully commercialize our product candidates. ● If an improved version of an originator product, such as Neulasta or Humira, is developed or if the market for the originator product significantly declines, sales of our biosimilar products may suffer. ● Healthcare reform measures, including the IRA, may increase the difficulty and cost for us to obtain marketing approval for and commercialize our products, affect the prices we may set, and have a material adverse effect on our business and results of operations. ● We are highly dependent on the services of our key executives and personnel, including our President and Chief Executive Officer, Dennis M.
If we fail to compete effectively, we may not achieve significant market penetration and expansion. ● We face intense competition and rapid technological change and the possibility that our competitors may develop therapies that are similar, more advanced or more effective than ours, which may adversely affect our financial condition and our ability to successfully commercialize our product candidates. ● If an improved version of an originator product, such as Neulasta, is developed or if the market for the originator product significantly declines, sales of our biosimilar product may suffer. ● Healthcare reform measures, including the IRA, may increase the difficulty and cost for us to obtain marketing approval for and commercialize our products, affect the prices we may set, and have a material adverse effect on our business and results of operations. ● We are highly dependent on the services of our key executives and personnel, including our President and Chief Executive Officer, Dennis M.
These efforts may include or have included: ● settling, or refusing to settle, patent lawsuits with biosimilar companies, resulting in such patents remaining an obstacle for biosimilar approval; ● submitting Citizen Petitions to request the FDA Commissioner to take administrative action with respect to prospective and submitted biosimilar applications; ● appealing denials of Citizen Petitions in United States federal district courts and seeking injunctive relief to reverse approval of biosimilar applications; ● restricting access to reference brand products for equivalence and biosimilarity testing that interferes with timely biosimilar development plans; ● attempting to influence potential market share by conducting medical education with physicians, payers, regulators and patients claiming that biosimilar products are too complex for biosimilar approval or are too dissimilar from originator products to be trusted as safe and effective alternatives; ● implementing payer market access tactics that benefit their brands at the expense of biosimilars; seeking state law restrictions on the substitution of biosimilar products at the pharmacy without the intervention of a physician or through other restrictive means such as excessive recordkeeping requirements or patient and physician notification; ● seeking federal or state regulatory restrictions on the use of the same non-proprietary name as the reference brand product for a biosimilar or interchangeable biologic; ● seeking changes to the United States Pharmacopeia, an industry recognized compilation of drug and biologic standards; ● obtaining new patents covering existing products or processes, which could extend patent exclusivity for a number of years or otherwise delay the launch of biosimilars; and ● influencing legislatures so that they attach special patent extension amendments to unrelated federal legislation. ​ 34 Table of Contents Our products and our product candidates, if approved, could face price competition from other products or biosimilars of the same reference products for the same indication.
These efforts may include or have included: ● settling, or refusing to settle, patent lawsuits with biosimilar companies, resulting in such patents remaining an obstacle for biosimilar approval; ● submitting Citizen Petitions to request the FDA Commissioner to take administrative action with respect to prospective and submitted biosimilar applications; ● appealing denials of Citizen Petitions in United States federal district courts and seeking injunctive relief to reverse approval of biosimilar applications; ● restricting access to reference brand products for equivalence and biosimilarity testing that interferes with timely biosimilar development plans; ● attempting to influence potential market share by conducting medical education with physicians, payers, regulators and patients claiming that biosimilar products are too complex for biosimilar approval or are too dissimilar from originator products to be trusted as safe and effective alternatives; ● implementing payer market access tactics that benefit their brands at the expense of biosimilars; ● seeking state law restrictions on the substitution of biosimilar products at the pharmacy without the intervention of a physician or through other restrictive means such as excessive recordkeeping requirements or patient and physician notification; ● seeking federal or state regulatory restrictions on the use of the same non-proprietary name as the reference brand product for a biosimilar or interchangeable biologic; ● seeking changes to the United States Pharmacopeia, an industry recognized compilation of drug and biologic standards; ● obtaining new patents covering existing products or processes, which could extend patent exclusivity for a number of years or otherwise delay the launch of biosimilars; and ● influencing legislatures so that they attach special patent extension amendments to unrelated federal legislation. ​ 33 Table of Contents Our products and our product candidates, if approved, could face price competition from other products or biosimilars of the same reference product for the same indication.
Additionally, obtaining placement on national and/or local clinical guidelines/pathways, as well as coverage on third-party payor formularies, can impact our short and long-term financial performance. ● As we have in-licensed development and/or commercial rights to LOQTORZI, we rely on prior and ongoing preclinical, clinical, regulatory and manufacturing expertise of our collaborators in order to advance this product candidate through regulatory approvals in the United States and other licensed territories. ● Our products and our product candidates, even if approved, will remain subject to regulatory scrutiny. ● Disruptions at the FDA and other government agencies caused by funding shortages, government shut-downs or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, and conduct inspections of manufacturing facilities, or otherwise prevent new or modified products from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business. ● Our biosimilar products face significant competition from the reference products and from other biosimilar products or pharmaceuticals approved for the same indication as the originator products.
Additionally, obtaining placement on national and/or local clinical guidelines/pathways, as well as coverage on third-party payor formularies, can impact our short and long-term financial performance. ● As we have in-licensed development and/or commercial rights to LOQTORZI, we rely on prior and ongoing preclinical, clinical, regulatory and manufacturing expertise of our collaborators in order to advance this product candidate through regulatory approvals in the United States and other licensed territories. ● Our products and our product candidates, even if approved, will remain subject to regulatory scrutiny. ● Disruptions at the FDA and other government agencies caused by funding shortages, government shut-downs or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, and conduct inspections of manufacturing facilities, or otherwise prevent new or modified products from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business. ● Our biosimilar product faces significant competition from the reference product and from other biosimilar products or pharmaceuticals approved for the same indication as the originator products.
Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; ● federal and state consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; ● the federal physician “sunshine” requirements under the ACA, which requires certain manufacturers of drugs, devices, biologics and medical supplies to report annually to the Centers for Medicare & Medicaid Services information related to payments and other transfers of value made by such manufacturers to physicians (defined to include doctors, dentists, optometrists, podiatrists, chiropractors, and certain non-physician practitioners (physician assistants, nurse practitioners, 55 Table of Contents clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants and certified nurse midwives)), and teaching hospitals and ownership and investment interests held by physicians and their immediate family members; and ● state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws that may apply to items or services reimbursed by any third-party payer, including commercial insurers, state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; and state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures and pricing information.
Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; ● federal and state consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; ● the federal physician “sunshine” requirements under the ACA, which requires certain manufacturers of drugs, devices, biologics and medical supplies to report annually to the Centers for Medicare & Medicaid Services information related to payments and other transfers of value made by such manufacturers to physicians (defined to include doctors, dentists, optometrists, podiatrists, chiropractors, and certain non-physician practitioners (physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants and certified nurse midwives)), and teaching hospitals and ownership and investment interests held by physicians and their immediate family members; and ● state and foreign law equivalents of each of the above federal laws, such as anti-kickback and false claims laws that may apply to items or services reimbursed by any third-party payer, including commercial insurers, state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; and state laws that require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures and pricing information.
We also need to make a determination of excess or obsolete inventory that requires significant judgment and may result in write-downs of inventory, charges related to firm purchase commitments, or both. Any adverse developments affecting the manufacturing operations of our products and product candidates could substantially increase our costs and limit supply for our products and product candidates.
We also need to make a determination of excess or obsolete inventory that requires judgment and may result in write-downs of inventory, charges related to firm purchase commitments, or both. Any adverse developments affecting the manufacturing operations of our products and product candidates could substantially increase our costs and limit supply for our products and product candidates.
If we or one of our collaboration partners were to initiate legal proceedings against a third party to enforce a patent covering one of our product candidates, the defendant could counterclaim that the patent covering our product candidate is invalid and/or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity and/or unenforceability are commonplace.
If we or one of our collaboration partners were to initiate legal proceedings against a third party to enforce a patent covering one of our product candidates, the defendant could counterclaim that the patent covering our product candidate is invalid or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace.
Further, the Loan Agreement includes certain other affirmative covenants and negative covenants, including, covenants and restrictions that among other things, restrict our ability to incur liens, incur additional indebtedness, make investments, engage in certain mergers and acquisitions or asset sales, and declare dividends or redeem or repurchase capital stock.
Further, the 2029 Loan Agreement includes certain other affirmative covenants and negative covenants, including, covenants and restrictions that among other things, restrict our ability to incur liens, incur additional indebtedness, make investments, engage in certain mergers and acquisitions or asset sales, and declare dividends or redeem or repurchase capital stock.
We are dependent on Junshi Biosciences and Orox for the commercialization of our product candidates in certain markets and we intend to seek additional commercialization partners for major markets, and the failure to commercialize in those markets could have a material adverse effect on our business and operating results.
We are dependent on Junshi Biosciences and Orox / Gador for the commercialization of our product candidates in certain markets and we intend to seek additional commercialization partners for major markets, and the failure to commercialize in those markets could have a material adverse effect on our business and operating results.
We have relied upon and plan to continue to rely upon third-party clinical research organizations (“CROs”) to monitor and manage data for our ongoing nonclinical and clinical programs. We rely on these parties for execution of our nonclinical and clinical studies and control only certain aspects of their activities.
We have relied upon and plan to continue to rely upon third-party contract research organizations (“CROs”) to monitor and manage data for our ongoing nonclinical and clinical programs. We rely on these parties for execution of our nonclinical and clinical studies and control only certain aspects of their activities.
We also need to make a determination of excess or obsolete inventory that requires significant judgment and includes consideration of many factors, such as estimates of future product demand, current and future market conditions, product expiration information and potential product obsolescence, among others.
We also need to make a determination of excess or obsolete inventory that requires judgment and includes consideration of many factors, such as estimates of future product demand, current and future market conditions, product expiration information and potential product obsolescence, among others.
Risks Related to Competitive Activity Our biosimilar products face significant competition from the reference products and from other biosimilar products or pharmaceuticals approved for the same indication as the originator products. Our product LOQTORZI and product candidate CHS-114, if approved, will face significant competition from other immuno-oncology biologics.
Risks Related to Competitive Activity Our biosimilar product faces significant competition from the reference product and from other biosimilar products or pharmaceuticals approved for the same indication as the originator products. Our product LOQTORZI and product candidate CHS-114, if approved, will face significant competition from other immuno-oncology biologics.
Additionally, if microbial, viral or other contaminations are discovered in our product candidates or in the manufacturing facilities in which our product candidates are made, such manufacturing facilities may need to be closed for an extended period of time to investigate and remedy the contamination.
Additionally, if microbial, viral or other contaminations are discovered in our products or product candidates or in the manufacturing facilities in which our products or product candidates are made, such manufacturing facilities may need to be closed for an extended period of time to investigate and remedy the contamination.
Should the originator company succeed in obtaining an approval of an improved biologic product, it may capture a significant share of the collective reference product market in the applicable jurisdiction and significantly reduce the market for the reference product and thereby the potential size of the market for our biosimilar products.
Should the originator company succeed in obtaining an approval of an improved biologic product, it may capture a significant share of the collective reference product market in the applicable jurisdiction and significantly reduce the market for the reference product and thereby the potential size of the market for our biosimilar product.
We have experienced reduced production yields, product defects and other supply disruptions. For example, we have experienced failures with respect to the manufacturing of certain lots of each of our product candidates resulting in delays prior to our taking corrective action.
We have experienced reduced production yields, product defects and other supply disruptions. For example, we have experienced failures with respect to the manufacturing of certain lots of each of our products and product candidates resulting in delays prior to our taking corrective action.
The degree of market acceptance of our recently launched product, LOQTORZI, or any of our product candidates, if approved for commercial sale, will depend on a number of factors, including: ● the safety and efficacy of the product, as demonstrated in clinical studies, and potential advantages over competing treatments; ● the prevalence and severity of any side effects and any limitations or warnings contained in a product’s approved labeling; ● the clinical indications for which approval is granted; ● for our immuno-oncology product candidates, our ability to compete in a competitive immuno-oncology market that may differ from the biosimilar market; ● inclusion, in either parity or better position, on commonly accepted clinical guidelines or pathways that influence prescribing patterns and/or affect reimbursement; ● relative convenience, ease of administration and any real or perceived benefit from administration at home as opposed to in the clinic; ● prevalence of the disease or condition for which the product is approved; ● the cost of treatment, particularly in relation to competing treatments; ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ● the strength of marketing and distribution support and timing of market introduction of competitive products; ● the extent to which the product is approved for inclusion on formularies of hospitals, integrated delivery networks and managed care organizations; ● publicity concerning our products or competing products and treatments; ● the extent to which third-party payers (including government and national/regional commercial plans) provide adequate third-party coverage and reimbursement for our products and product candidates, if approved; ● the price at which we sell our products; 30 Table of Contents ● the potential impact of the IRA on the pharmaceutical industry and the market for biosimilars; ● the actions taken by current and future competitors to delay, restrict or block customer usage of the product; and ● our ability to maintain compliance with regulatory requirements.
The degree of market acceptance of our product LOQTORZI, or any of our product candidates, if approved for commercial sale, will depend on a number of factors, including: ● the safety and efficacy of the product, as demonstrated in clinical studies, and potential advantages over competing treatments; ● the prevalence and severity of any side effects and any limitations or warnings contained in a product’s approved labeling; ● the clinical indications for which approval is granted; ● for our immuno-oncology product candidates, our ability to compete in a competitive immuno-oncology market that may differ from the biosimilar market; ● inclusion, in either parity or better position, on commonly accepted clinical guidelines or pathways that influence prescribing patterns and/or affect reimbursement; ● relative convenience, ease of administration and any real or perceived benefit from administration at home as opposed to in the clinic; ● prevalence of the disease or condition for which the product is approved; ● the cost of treatment, particularly in relation to competing treatments; ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ● the strength of marketing and distribution support and timing of market introduction of competitive products; ● the extent to which the product is approved for inclusion on formularies of hospitals, integrated delivery networks and managed care organizations; 29 Table of Contents ● publicity concerning our products or competing products and treatments; ● the extent to which third-party payers (including government and national/regional commercial plans) provide adequate third-party coverage and reimbursement for our products and product candidates, if approved; ● the price at which we sell our products; ● the potential impact of the IRA on the pharmaceutical industry and the market for our products; ● the actions taken by current and future competitors to delay, restrict or block customer usage of the product; and ● our ability to maintain compliance with regulatory requirements.
We do not currently have the infrastructure or capability internally to manufacture supplies of our product candidates for use in our nonclinical and clinical studies, and we lack the resources and the capability to manufacture any of our product candidates on a clinical or commercial scale.
We do not currently have the infrastructure or capability internally to manufacture supplies of our products and product candidates for use in our nonclinical and clinical studies, and we lack the resources and the capability to manufacture any of our products and product candidates on a clinical or commercial scale.
The eligibility criteria of our clinical trials, once established, may further limit the pool of available trial participants. ​ Patient enrollment in clinical trials may be affected by other factors, including: • size and nature of the targeted patient population; • severity of the disease or condition under investigation; • availability and efficacy of approved therapies for the disease or condition under investigation; • patient eligibility criteria for the trial in question as defined in the protocol; • perceived risks and benefits of the product candidate under study; • clinicians’ and patients’ perceptions as to the potential advantages of the product candidate being studied in relation to other available therapies, including any products that may be approved for, or any product candidates under investigation for, the indications we are investigating; • efforts to facilitate timely enrollment in clinical trials; • patient referral practices of physicians; • the ability to monitor patients adequately during and after treatment; • proximity and availability of clinical trial sites for prospective patients; • continued enrollment of prospective patients by clinical trial sites; and • the risk that patients enrolled in clinical trials will drop out of such trials before completion.
The eligibility criteria of our clinical trials, once established, may further limit the pool of available trial participants. ​ Patient enrollment in clinical trials may be affected by other factors, including: • size and nature of the targeted patient population; • severity of the disease or condition under investigation; • availability and efficacy of approved therapies for the disease or condition under investigation; • patient eligibility criteria for the trial in question as defined in the protocol; • perceived risks and benefits of the product candidate under study; 50 Table of Contents • clinicians’ and patients’ perceptions as to the potential advantages of the product candidate being studied in relation to other available therapies, including any products that may be approved for, or any product candidates under investigation for, the indications we are investigating; • efforts to facilitate timely enrollment in clinical trials; • patient referral practices of physicians; • the ability to monitor patients adequately during and after treatment; • proximity and availability of clinical trial sites for prospective patients; • continued enrollment of prospective patients by clinical trial sites; and • the risk that patients enrolled in clinical trials will drop out of such trials before completion.
The labelling of “interchangeability” is important because, in the United States for example, the first biosimilar determined to be interchangeable with a particular reference, or originator, product for any condition of use is eligible for a period of market exclusivity that 52 Table of Contents delays an FDA determination that a second or subsequent biosimilar product is interchangeable with that originator product for any condition of use until the earlier of: (1) one year after the first commercial marketing of the first interchangeable product; (2) 18 months after resolution of a patent infringement suit instituted under 42 U.S.C. § 262(l)(6) against the applicant that submitted the application for the first interchangeable product, based on a final court decision regarding all of the patents in the litigation or dismissal of the litigation with or without prejudice; (3) 42 months after approval of the first interchangeable product, if a patent infringement suit instituted under 42 U.S.C. § 262(l)(6) against the applicant that submitted the application for the first interchangeable product is still ongoing; or (4) 18 months after approval of the first interchangeable product if the applicant that submitted the application for the first interchangeable product has not been sued under 42 U.S.C. § 262(l)(6).
The labelling of “interchangeability” is important because, in the United States for example, the first biosimilar determined to be interchangeable with a particular reference, or originator, product for any condition of use is eligible for a period of market exclusivity that delays an FDA determination that a second or subsequent biosimilar product is interchangeable with that originator product for any condition of use until the earlier of: (1) one year after the first commercial marketing of the first interchangeable product; (2) 18 months after resolution of a patent infringement suit instituted under 42 U.S.C. § 262(l)(6) against the applicant that submitted the application for the first interchangeable product, based on a final court decision regarding all of the patents in the litigation or dismissal of the litigation with or without prejudice; (3) 42 months after approval of the first interchangeable product, if a patent infringement suit instituted under 42 U.S.C. § 262(l)(6) against the applicant that submitted the application for the first interchangeable product is still ongoing; or (4) 18 months after approval of the first interchangeable product if the applicant that submitted the application for the first interchangeable product has not been sued under 42 U.S.C. § 262(l)(6).
If we fail to comply with applicable regulatory requirements, a regulatory agency or enforcement authority may, among other possibilities: ● issue warning letters; ● impose civil or criminal penalties; ● suspend or withdraw regulatory approval; ● suspend any of our ongoing clinical studies; ● refuse to approve pending applications or supplements to approved applications submitted by us; 32 Table of Contents ● impose restrictions on our operations, including closing our contract manufacturers’ facilities; or ● seize or detain products or require a product recall.
If we fail to comply with applicable regulatory requirements, a regulatory agency or enforcement authority may, among other possibilities: ● issue warning letters; ● impose civil or criminal penalties; 31 Table of Contents ● suspend or withdraw regulatory approval; ● suspend any of our ongoing clinical studies; ● refuse to approve pending applications or supplements to approved applications submitted by us; ● impose restrictions on our operations, including closing our contract manufacturers’ facilities; or ● seize or detain products or require a product recall.
Disruptions at the FDA and other government agencies caused by funding shortages, government shut-downs or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, and conduct inspections of manufacturing facilities, or otherwise prevent new or modified products from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business.
Disruptions at the FDA and other government agencies caused by funding shortages, staffing limitations, government shut-downs or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, and conduct inspections of manufacturing facilities, or otherwise prevent new or modified products from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business.
It is critical that we do so in a secure manner to maintain the confidentiality and integrity of such Confidential Information. ​ Despite the implementation of security measures, our information technology systems as well as those of our third-party collaborators, consultants, contractors, suppliers, and service providers, may be vulnerable to damage from physical or electronic break-ins, computer viruses, misconfigurations, “bugs” or other vulnerabilities, “phishing” attacks, malware, ransomware, denial of service and other cyberattacks or disruptive incidents that could result in unauthorized access to, use or disclosure of, corruption of, or loss of Confidential Information and could subject us to significant liabilities and regulatory and enforcement actions, and reputational damage.
It is critical that we do so in a secure manner to maintain the confidentiality and integrity of such Confidential Information. 68 Table of Contents Despite the implementation of security measures, our information technology systems as well as those of our third-party collaborators, consultants, contractors, suppliers, and service providers, may be vulnerable to damage from physical or electronic break-ins, computer viruses, misconfigurations, “bugs” or other vulnerabilities, “phishing” attacks, malware, ransomware, denial of service and other cyberattacks or disruptive incidents that could result in unauthorized access to, use or disclosure of, corruption of, or loss of Confidential Information, and could subject us to significant liabilities and regulatory and enforcement actions, and reputational damage.
Additionally, if one or more of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, a number of potentially significant negative consequences could result, including but not limited to: ● regulatory authorities may withdraw approvals of such product; ● regulatory authorities may require additional warnings on the label; ● we may be required to create a REMS plan, 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; and ● our reputation may suffer.
Additionally, if one or more of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, a number of potentially significant negative consequences could result, including but not limited to: ● regulatory authorities may withdraw approvals of such product; ● regulatory authorities may require additional warnings on the label; 43 Table of Contents ● we may be required to create a REMS plan, 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; and ● our reputation may suffer.
On October 12, 2023, the UK Extension to the DPF came into effect (as approved by the UK government), as a UK GDPR data transfer mechanism from the U.K. to U.S. entities self-certified under the DPF. Other foreign jurisdictions are increasingly implementing or developing their own privacy regimes with complex and onerous compliance obligations and robust regulatory enforcement powers.
On October 12, 2023, the U.K. Extension to the DPF came into effect (as approved by the U.K. government), as a data transfer mechanism from the U.K. to U.S. entities self-certified under the DPF. Other foreign jurisdictions are increasingly implementing or developing their own privacy regimes with complex and onerous compliance obligations and robust regulatory enforcement powers.
If we are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from participation in government health care programs, such as Medicare and Medicaid, imprisonment, additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations.
If we are found to be in violation of any of the laws described above or any other governmental regulations that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion from participation in government health care programs, such as Medicare and Medicaid, imprisonment, additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and 55 Table of Contents our results of operations.
If we are unable to obtain funding on a timely basis or at all, stay profitable or generate any net profits, we may be required to significantly curtail, delay or discontinue one or more of our research or development programs or the commercialization of any products or product candidates or be unable to expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our financial condition and results of operations. 28 Table of Contents ​ Risks Related to Launch and Commercialization of our Products and our Product Candidates We have a limited operating history in an emerging regulatory environment on which to assess our business.
If we are unable to obtain funding on a timely basis or at all, stay profitable or generate any net profits, we may be required to significantly curtail, delay or discontinue one or more of our research or development programs or the commercialization of any products or product candidates or be unable to expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our financial condition and results of operations. ​ Risks Related to Launch and Commercialization of our Products and our Product Candidates We have a limited operating history in an emerging regulatory environment on which to assess our business.
Individual states in the United States have also proposed and enacted legislation and implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, marketing cost disclosure and other transparency measures, and, in some cases, measures designed to encourage importation from other countries and bulk purchasing.
Individual states in the United States have also proposed and enacted legislation and implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, marketing cost disclosure, drug price reporting and other transparency measures, and, in some cases, measures designed to encourage importation from other countries and bulk purchasing.
Our development of novel biologic product candidates, such as casdozokitug and CHS-114, subjects us to additional risks relating to biosimilar competition.
Our development of novel biologic product candidates, such as casdozokitug, CHS-1000 and CHS-114, subjects us to additional risks relating to biosimilar competition.
We may need to request additional waivers from time to time with respect to the Loan Agreement and if we are unable to obtain a waiver that we need it could materially impact our business and financial results. Sales of a substantial number of shares of our common stock in the public market could cause our stock price to fall.
We may need to request waivers from time to time with respect to the 2029 Loan Agreement and if we are unable to obtain a waiver that we need it could materially impact our business and financial results. Sales of a substantial number of shares of our common stock in the public market could cause our stock price to fall.
The process of manufacturing our product candidates is complex, highly regulated and subject to several risks, including but not limited to: ● product loss due to contamination, equipment failure or improper installation or operation of equipment or vendor or operator error; ● equipment failures, labor shortages, natural disasters, power failures and numerous other factors associated with the manufacturing facilities in which our product candidates are produced, and potentially exacerbated by climate change; and ● disruption of supply chains for critical and specialized raw materials, delays in regulatory inspections of manufacturing and testing facilities, and reduced manufacturing capacities created by global events such as the COVID-19 pandemic and the ongoing conflict in Ukraine.
The process of manufacturing our product candidates is complex, highly regulated and subject to several risks, including but not limited to: ● product loss due to contamination, equipment failure or improper installation or operation of equipment or vendor or operator error; ● equipment failures, labor shortages, natural disasters, power failures and numerous other factors associated with the manufacturing facilities in which our product candidates are produced, and potentially exacerbated by climate change; and ● disruption of supply chains for critical and specialized raw materials, delays in regulatory inspections of manufacturing and testing facilities, and reduced manufacturing capacities created by global events such as the COVID-19 pandemic and the ongoing conflicts in Ukraine and the Middle East.
The sale of additional equity or convertible securities, such as the sales from time to time through our sales agreement dated November 8, 2022 (“Sales Agreement”) with Cowen and Company, LLC (“TD Cowen”) pursuant to which we may issue and sell from time to time up to $150.0 million of our common stock through or to TD Cowen as our sales agent or principal in an at-the-market offering (“ATM Offering”), may dilute the share ownership of our existing stockholders.
The sale of additional equity or convertible securities, such as the sales from time to time through our sales agreement dated November 8, 2022 (the “Sales Agreement”) with Cowen and Company, LLC (“TD Cowen”) pursuant to which we may issue and sell from time to time up to $150.0 million of our common stock, including the common stock already sold, through or to TD Cowen as our sales agent or principal in an at-the-market offering (“ATM Offering”), may dilute the share ownership of our existing stockholders.
Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” and should be carefully considered, together with other information in this Annual Report on Form 10-K, including our financial statements and related notes thereto, before making investment decisions regarding our common stock. ● We have a limited history of profitability, which we have not maintained and may not achieve again, and only three products that have been approved and marketed, with multiple products that are not approved and still in development. ● The commercial success of our existing products or any future products will depend upon the degree of market acceptance and adoption by prescribing physicians, healthcare providers and the patients to whom our medicines are prescribed.
Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” and should be carefully considered, together with other information in this Annual Report on Form 10-K, including our financial statements and related notes thereto, before making investment decisions regarding our common stock. ● We have a limited history of profitability, which we have not maintained and may not achieve again, and only two products that have been approved and marketed, one of which we have agreed to sell, and with multiple products that are not approved and still in development. ● The commercial success of our existing products or any future products will depend upon the degree of market acceptance and adoption by prescribing physicians, healthcare providers and the patients to whom our medicines are prescribed.
Furthermore, while payers have adopted the Q-Codes assigned by CMS for UDENYCA, there remains uncertainty as to whether such payers will continue to cover and pay providers for the administration and use of the product with each patient or may favor competing products.
Furthermore, while payers have adopted the Q-Code assigned by CMS for UDENYCA, there remains uncertainty as to whether such payers will continue to cover and pay providers for the administration and use of the product with each patient or may favor competing products.
Further, the continued hybrid working environment has generally increased the attack surface available to criminals, as more companies and individuals work online and work remotely, and as such, the risk of a cybersecurity incident potentially occurring, and our investment in risk mitigations against such an incident, is increasing.
Further, the continued hybrid working environment has generally increased the attack surface available to criminals, as more companies and individuals work online and work remotely, and as such, the risk of a cybersecurity incident potentially occurring, and our investment in risk mitigations against such incidents, is increasing.
Although we have received upfront payments, milestone and other contingent payments and/or funding for development from some of our collaboration and license agreements, our only approved products include UDENYCA, YUSIMRY and LOQTORZI which are approved for commercialization in the United States, and we have no products approved in any other territories.
Although we have received upfront payments, milestone and other contingent payments and/or funding for development from some of our collaboration and license agreements, our only approved products are UDENYCA and LOQTORZI which are approved for commercialization in the United States, and we have no products approved in any other territories.
We currently anticipate that we will retain any future earnings for the development, operation and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Any return to stockholders will therefore be limited to any appreciation of their stock.
We currently anticipate that we will retain any future earnings for the development, operation and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Any potential return to stockholders will therefore be limited to the appreciation of their stock, if any.
These factors include those discussed in the “Risk Factors” section of this Annual Report on Form 10-K and others such as: ● adverse results or delays in preclinical or clinical studies; ● the risk of deterioration in our financial conditions, such as reduced collection of cash and increased costs in the future; ● any inability to obtain additional funding; ● any delay in filing an IND, NDA, BLA, Section 351(k) BLA or other regulatory submission for any of our product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory agency’s review of that IND, NDA, BLA, Section 351(k) BLA or other regulatory submission; ● the perception of limited market sizes or pricing for our products and product candidates; ● failure to successfully develop and commercialize our product candidates; 57 Table of Contents ● post-marketing safety issues relating to our product candidates or biosimilars generally; ● failure to maintain our existing strategic collaborations or enter into new collaborations; ● failure by us or our licensors and strategic collaboration partners to prosecute, maintain or enforce our intellectual property rights; ● changes in laws or regulations applicable to our products; ● future outbreaks of COVID-19 and other viral pandemics; ● any inability to obtain adequate product supply for our product candidates or the inability to do so at acceptable prices; ● adverse regulatory decisions; ● introduction of new products, services or technologies by our competitors; ● failure to meet or exceed financial projections we may provide to the public; ● failure to meet or exceed the financial projections of the investment community; ● the perception of the pharmaceutical industry by the public, legislatures, regulators and the investment community; ● announcements of significant acquisitions, dispositions, strategic partnerships, joint ventures or capital commitments by us, our strategic collaboration partners or our competitors; ● disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our technologies; ● additions or departures of key scientific or management personnel; ● lawsuits, including but not limited to complaints initiated by stockholders, customers and collaboration partners, and litigation filed by us or filed against us pertaining to patent infringement or other violations of intellectual property rights; ● the outcomes of any citizen petitions filed by parties seeking to restrict or limit the approval of biosimilar products; ● 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 stock; ● changes in the market valuations of similar companies; ● general market or macroeconomic conditions, including rising interest rates and inflation; ● sales of our common stock by us or our stockholders in the future; ● trading volume of our common stock; ● issuance of patents to third parties that could prevent our ability to commercialize our product candidates; ● reductions in the prices of originator products that could reduce the overall market opportunity for our product candidates intended as biosimilars to such originator products; and ● changes in biosimilar regulatory requirements that could make it more difficult for us to develop our product candidates.
These factors include those discussed in the “Risk Factors” section of this Annual Report on Form 10-K and others such as: ● adverse results or delays in preclinical or clinical studies; ● the risk of deterioration in our financial conditions, such as reduced collection of cash and increased costs in the future; ● any inability to obtain additional funding; ● any delay or inability to satisfy the conditions to closing of the UDENYCA Sale or failure to receive either of the Earnout Payments after the closing; ● any delay in filing an IND, NDA, BLA, Section 351(k) BLA or other regulatory submission for any of our product candidates and any adverse development or perceived adverse development with respect to the applicable regulatory agency’s review of that IND, NDA, BLA, Section 351(k) BLA or other regulatory submission; ● the perception of limited market sizes or pricing for our products and product candidates; ● failure to successfully develop and commercialize our product candidates; ● post-marketing safety issues relating to our product candidates or products; ● failure to maintain our existing strategic collaborations or enter into new collaborations; ● failure by us or our licensors and strategic collaboration partners to prosecute, maintain or enforce our intellectual property rights; ● changes in laws or regulations applicable to our products; ● future outbreaks of COVID-19 and other viral pandemics; ● any inability to obtain adequate product supply for our products and product candidates or the inability to do so at acceptable prices; ● adverse regulatory decisions; ● introduction of new products, services or technologies by our competitors; ● failure to meet or exceed financial projections we may provide to the public; ● failure to meet or exceed the financial projections of the investment community; ● the perception of the pharmaceutical industry by the public, legislatures, regulators and the investment community; 57 Table of Contents ● announcements of significant acquisitions, dispositions, strategic partnerships, joint ventures or capital commitments by us, our strategic collaboration partners or our competitors; ● disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our technologies; ● additions or departures of key scientific or management personnel; ● lawsuits, including but not limited to complaints initiated by stockholders, customers and collaboration partners, and litigation filed by us or filed against us pertaining to patent infringement or other violations of intellectual property rights; ● the outcomes of any citizen petitions filed by parties seeking to restrict or limit the approval of our biosimilar product; ● 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 company or our stock; ● changes in the market valuations of similar companies; ● general market or macroeconomic conditions, including rising interest rates and inflation; ● sales of our common stock by us or our stockholders in the future; ● trading volume of our common stock; ● issuance of patents to third parties that could prevent our ability to commercialize our product candidates; ● reductions in the prices of originator products that could reduce the overall market opportunity for our product intended as a biosimilar to such originator products; and ● changes in regulatory requirements that could make it more difficult for us to develop our product candidates.
Events that may prevent successful or timely completion of clinical development include but are not limited to: ● inability to generate sufficient preclinical, toxicology or other in vivo or in vitro data to support the initiation of human clinical studies; ● delays in reaching a consensus with regulatory agencies on study design; ● delays in reaching agreement on acceptable terms with prospective CROs, and clinical study sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and clinical study sites; ● delays in obtaining required IRB approval at each clinical study site; ● imposition of a clinical hold by regulatory agencies, after review of an IND or amendment or equivalent application or amendment, or an inspection of our clinical study operations or study sites or as a result of adverse events reported during a clinical trial; ● delays in recruiting suitable patients to participate in our clinical studies sponsored by us or our partners; ● difficulty collaborating with patient groups and investigators; ● failure by our CROs, other third parties or us to adhere to clinical study requirements; ● failure to perform in accordance with the FDA’s good clinical practices requirements or applicable regulatory guidelines in other countries; ● delays in patients completing participation in a study or return for post-treatment follow-up, or patients dropping out of a study; ● occurrence of adverse events associated with the product candidate that are viewed to outweigh its potential benefits; ● changes in regulatory requirements and guidance that require amending or submitting new clinical protocols; ● the cost of clinical studies of our product candidates being greater than we anticipate; ● clinical studies of our product candidates producing negative or inconclusive results, which may result in us deciding or regulators requiring us to conduct additional clinical studies or abandon product development programs; and ● delays in manufacturing, testing, releasing, validating or importing/exporting and/or distributing sufficient stable quantities of our product candidates and originator products for use in clinical studies or the inability to do any of the foregoing. 50 Table of Contents Any inability to successfully complete nonclinical and clinical development could result in additional costs to us or impair our ability to generate revenue.
Events that may prevent successful or timely completion of clinical development include but are not limited to: 49 Table of Contents ● inability to generate sufficient preclinical, toxicology or other in vivo or in vitro data to support the initiation of human clinical studies; ● delays in reaching a consensus with regulatory agencies on study design; ● delays in reaching agreement on acceptable terms with prospective CROs, and clinical study sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and clinical study sites; ● delays in obtaining required IRB approval at each clinical study site; ● imposition of a clinical hold by regulatory agencies, after review of an IND or amendment or equivalent application or amendment, or an inspection of our clinical study operations or study sites or as a result of adverse events reported during a clinical trial; ● delays in recruiting suitable patients to participate in our clinical studies sponsored by us or our partners; ● difficulty collaborating with patient groups and investigators; ● failure by our CROs, other third parties or us to adhere to clinical study requirements; ● failure to perform in accordance with the FDA’s good clinical practices requirements or applicable regulatory guidelines in other countries; ● delays in patients completing participation in a study or return for post-treatment follow-up, or patients dropping out of a study; ● occurrence of adverse events associated with the product candidate that are viewed to outweigh its potential benefits; ● changes in regulatory requirements and guidance that require amending or submitting new clinical protocols; ● the cost of clinical studies of our product candidates being greater than we anticipate; ● clinical studies of our product candidates producing negative or inconclusive results, which may result in us deciding or regulators requiring us to conduct additional clinical studies or abandon product development programs; and ● delays in manufacturing, testing, releasing, validating or importing/exporting and/or distributing sufficient stable quantities of our product candidates and originator products for use in clinical studies or the inability to do any of the foregoing.
We could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage or for a lower price than otherwise would be desirable and we may be required to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects.
We could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage or for a lower 27 Table of Contents price than otherwise would be desirable and we may be required to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects.
A delay in the development of our product candidates, or having to enter into a new agreement with a different third party on less favorable terms than we have with our current suppliers, could have a material adverse impact on our business.
A delay in the development of our products and product candidates, or having to enter into a new agreement with a different third party on less favorable terms than we have with our current suppliers, could have a material adverse impact on our business.
If these third parties do not successfully carry out their contractual duties, meet expected deadlines or comply with regulatory requirements, we may not be able to obtain regulatory approval for or commercialize our product candidates and our business could be substantially harmed. ● We are subject to a multitude of manufacturing risks and the risks of inaccurately forecasting sales of our products.
If these third parties do not successfully carry out their contractual duties, meet expected deadlines or comply with regulatory requirements, we may not be able to obtain regulatory approval for or commercialize our product candidates and our business could be substantially harmed. 24 Table of Contents ● We are subject to a multitude of manufacturing risks and the risks of inaccurately forecasting sales of our products.
We are marketing LOQTORZI, UDENYCA and YUSIMRY in the United States, and subject to product approvals and relevant patent and settlement agreement expirations, we intend to market our other biosimilar products in the United States and outside the United States on our own or with future collaboration partners.
We are marketing LOQTORZI and UDENYCA in the United States, and subject to product approvals and relevant patent and settlement agreement expirations, we intend to market our other products in the United States and outside the United States on our own or with future collaboration partners.
The ACA, among other things, modified the AMP definition under the MDRP for drugs that are inhaled, infused, instilled, implanted or injected and not generally distributed through the retail channel; expanded rebate payments under the MDRP to include utilization by individuals enrolled in Medicaid managed care organizations; added a provision to increase the Medicaid rebate for line extension drugs; established annual fees and taxes on manufacturers of certain branded prescription drugs; expanded the entities eligible for discounts under the Public Health Service 340B drug pricing program; and established the Medicare Part D coverage gap discount program, in which manufacturers must agree to offer point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D.
The ACA, among other things, modified the average manufacturer price (“AMP”) definition under the Medicaid Drug Rebate Program (“MDRP”) for drugs that are inhaled, infused, instilled, implanted or injected and not generally distributed through the retail channel; expanded rebate payments under the MDRP to include utilization by individuals enrolled in Medicaid managed care organizations; added a provision to increase the Medicaid rebate for line extension drugs; established annual fees and taxes on manufacturers of certain branded prescription drugs; expanded the entities eligible for discounts under the Public Health Service 340B drug pricing program; and established the Medicare Part D coverage gap discount program, in which manufacturers must agree to offer point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer’s outpatient drugs to be covered under Medicare Part D.
Further, continued market acceptance of UDENYCA, LOQTORZI and YUSIMRY, and any future product candidates that may be approved, depends on our efforts to educate the medical community and third-party payers on the benefits of our products and product candidates and will require significant resources from us and we have significantly less resources compared to large, well-funded pharmaceutical entities.
Further, continued market acceptance of UDENYCA (prior to the UDENYCA Sale) and LOQTORZI, and any future product candidates that may be approved, depends on our efforts to educate the medical community and third-party payers on the benefits of our products and product candidates and will require significant resources from us and we have significantly less resources compared to large, well-funded pharmaceutical entities.
In markets outside of the United States and E.U., reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies. We may be subject, directly or indirectly, to federal and state healthcare laws, including fraud and abuse, false claims and physician payment transparency laws.
In markets outside of the United States and E.U., reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies. ​ 54 Table of Contents We may be subject, directly or indirectly, to federal and state healthcare laws, including fraud and abuse, false claims and physician payment transparency laws.
If the market for the reference product is impacted, we may lose significant market share for our approved biosimilar products. As a result of the above factors, our business, prospects and financial condition could suffer. ​ 35 Table of Contents Any product candidates for which we intend to seek approval as original biologic products may face competition sooner than anticipated.
If the market for the reference product is impacted, we may lose significant market share for our biosimilar product. As a result of the above factors, our business, prospects and financial condition could suffer. 34 Table of Contents Any product candidates for which we intend to seek approval as original biologic products may face competition sooner than anticipated.
Finally, it is possible that some countries will not approve a biosimilar without clinical data from their population or may require that the biosimilar product be manufactured within their region, or some countries may require both. If other biosimilars of pegfilgrastim (Neulasta) or adalimumab (Humira) are determined to be interchangeable and our biosimilar products are not, our business could suffer.
Finally, it is possible that some countries will not approve a biosimilar without clinical data from their population or may require that the biosimilar product be manufactured within their region, or some countries may require both. If other biosimilars of pegfilgrastim (Neulasta) are determined to be interchangeable and our biosimilar product is not, our business could suffer.
We expect that additional state and federal healthcare reform measures will be adopted in the future, any 54 Table of Contents of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures, such as a single reimbursement code for biosimilar products.
We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures, such as a single reimbursement code for biosimilar products.
Given the challenges caused by the inherent variability in protein production, we may not be successful in developing our biosimilar products if regulators conclude that we have not achieved a sufficient level of biosimilarity to the originator product, or that the processes we use are unable to generate our products within an acceptable range of variability.
Given the challenges caused by the inherent variability in protein production, we may not be successful in continuing to develop our biosimilar product if regulators conclude that we have not achieved a sufficient level of biosimilarity to the originator product, or that the processes we use are unable to generate our products are within an acceptable range of variability.
We may also be exposed to a risk of loss or litigation and potential liability, which could materially and adversely affect our business, results of operations or financial condition. Our insurance policies may not be 68 Table of Contents adequate to compensate us for the potential losses arising from such disruptions, failure, or security breach.
We may also be exposed to a risk of loss or litigation and potential liability, which could materially and adversely affect our business, results of operations or financial condition. Our insurance policies may not be adequate to compensate us for the potential losses arising from such disruptions, failure, or security breach.
Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk. For example, as of December 31, 2023, we had an accumulated deficit of $1.6 billion.
Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk. For example, as of December 31, 2024, we had an accumulated deficit of $1.6 billion.
Our business could be harmed if those third parties fail to provide us with sufficient quantities of product candidates or fail to do so at acceptable quality levels or prices.
Our business could be harmed if those third parties fail to provide us with sufficient quantities of products and product candidates or fail to do so at acceptable quality levels or prices.
Moreover, even if we do obtain issued patents, they will not guarantee us the right to use our patented technology for commercialization of our product candidates. Third parties may have blocking patents that could prevent us from commercializing our own products, even if our products use or embody our own, patented inventions.
Moreover, even if we do obtain issued patents, they will not guarantee us the right to use our patented 45 Table of Contents technology for commercialization of our product candidates. Third parties may have blocking patents that could prevent us from commercializing our own products, even if our products use or embody our own, patented inventions.
We may incorrectly determine that our products are not covered by a third-party patent. 63 Table of Contents ​ Many patents may cover a marketed product, including but not limited to the composition of the product, methods of use, formulations, cell line constructs, vectors, growth media, production processes and purification processes.
We may incorrectly determine that our products are not covered by a third-party patent. Many patents may cover a marketed product, including but not limited to the composition of the product, methods of use, formulations, cell line constructs, vectors, growth media, production processes and purification processes.
Moreover, the extent to which a biosimilar, once approved, could be substituted for any one of our reference products in a way that is similar to traditional generic substitution for non-biological products will depend on a number of marketplace and regulatory factors that are still developing.
Moreover, the extent to which a biosimilar, once approved, could be substituted for any one of our reference products in a way that is similar to traditional generic substitution for non-biological products will depend on a number of marketplace and regulatory factors.
We must report 340B ceiling prices to HRSA on a quarterly basis, and HRSA publishes them to 340B covered entities. HRSA has finalized regulations regarding the calculation of the 340B ceiling price and the imposition of civil 56 Table of Contents monetary penalties on manufacturers that knowingly and intentionally overcharge covered entities for 340B eligible drugs.
We must report 340B ceiling prices to HRSA on a quarterly basis, and HRSA publishes them to 340B covered entities. HRSA has finalized regulations regarding the calculation of the 340B ceiling price and the imposition of civil monetary penalties on manufacturers that knowingly and intentionally overcharge covered entities for 340B eligible drugs.
We have financed our operations primarily through the sale of equity securities, convertible notes, credit facilities, license agreements and through recent product sales of our products. 27 Table of Contents However, our operating or investing plans may change as a result of many factors that may currently be unknown to us, and we may need to seek additional funds sooner than planned.
We have financed our operations primarily through the sale of equity securities, convertible notes, credit facilities, divestitures, license agreements and through recent product sales of our products. However, our operating or investing plans may change as a result of many factors that may currently be unknown to us, and we may need to seek additional funds sooner than planned.
If we are unable to develop manufacturing processes that achieve a requisite degree of biosimilarity to the originator drug, and within a range of variability considered acceptable by regulatory authorities, we may not be able to obtain regulatory approval for our biosimilar products. Protein-based therapeutics are inherently heterogeneous and their structures are highly dependent on the production process and conditions.
If we are unable to develop manufacturing processes that achieve a requisite degree of biosimilarity to the originator drug, and within a range of variability considered acceptable by regulatory authorities, we may not be able to maintain regulatory approval for our biosimilar product. Protein-based therapeutics are inherently heterogeneous and their structures are highly dependent on the production process and conditions.
These and other risks are described more fully in this “Risk Factors” section. ​ We incur significant increased costs as a result of operating as a public company, and our management is required to devote substantial time to compliance initiatives.
These and other risks are described more fully in this “Risk Factors” section. 67 Table of Contents We incur significant increased costs as a result of operating as a public company, and our management is required to devote substantial time to compliance initiatives.
If an improved version of an originator product, such as Neulasta or Humira, is developed or if the market for the originator product significantly declines, sales of our biosimilar products may suffer.
If an improved version of an originator product, such as Neulasta, is developed or if the market for the originator product significantly declines, sales of our biosimilar product may suffer.
We believe that LOQTORZI and any of our future product candidates approved under an original BLA should qualify for the 12-year period of exclusivity.
We believe that LOQTORZI does, and any of our product candidates approved under an original BLA should, qualify for the 12-year period of exclusivity.
Investor concerns regarding the U.S. or international financial systems could result in less favorable commercial financing terms, including 60 Table of Contents higher interest rates or costs and tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us to acquire financing on acceptable terms or at all.
Investor concerns regarding the U.S. or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us to acquire financing on acceptable terms or at all.
The facilities and quality systems of some or all of our collaboration partners and third-party contractors must pass a pre-approval inspection for compliance with the applicable regulations as a condition of regulatory approval of our product candidates or any of our other potential products.
The facilities and quality systems of some or all of our collaboration partners and third-party contractors must successfully complete a pre-approval inspection for compliance with the applicable regulations as a condition of regulatory approval of our product candidates or any of our other potential products.
Neither we nor any collaboration partner has obtained regulatory approval for any of our products and product candidates, other than UDENYCA, which has received approval from the FDA and EMA, YUSIMRY, which has received approval from the FDA, and LOQTORZI, which has received approval from the FDA and is also approved for use in China, and it is possible that none of our other current or future product candidates will ever obtain additional regulatory approvals.
Neither we nor any collaboration partner has obtained regulatory approval for any of our products and product candidates, other than UDENYCA, which has 48 Table of Contents received approval from the FDA and EMA, and LOQTORZI, which has received approval from the FDA and is also approved for use in China, and it is possible that none of our other current or future product candidates will ever obtain additional regulatory approvals.
If our products or any of our future product candidates, are not covered or adequately reimbursed by third-party payers, including Medicare, then the cost of the relevant product may be absorbed by healthcare providers or charged to patients.
If our products or any of our future product candidates, are not covered or adequately reimbursed by third-party payers, including 30 Table of Contents Medicare, then the cost of the relevant product may be absorbed by healthcare providers or charged to patients.
The number of shares available for issuance under the ESPP will automatically increase on the first day of each fiscal year beginning in 2015 and ending in 2024, equal to 1% of the shares of common stock outstanding on the last day of the immediately preceding fiscal year or such smaller number of shares as determined by our board of directors.
The number of shares available for issuance under the ESPP were automatically increased on the first day of each fiscal year beginning in 2015 and ending in 2024, equal to 1% of the shares of common stock outstanding on the last day of the immediately preceding fiscal year or such smaller number of shares as determined by our board of directors.
The product and patent landscape is highly uncertain and we cannot predict whether our patent filings will afford us a competitive advantage against third parties or if our etanercept and adalimumab products will avoid infringement of third-party patents. ​ We do not consider it necessary for us or our competitors to obtain or maintain a proprietary patent position in order to engage in the business of biosimilar development and commercialization.
The product and patent landscape is highly uncertain and we cannot predict whether our patent filings will afford us a competitive advantage against third parties or if our products will avoid infringement of third-party patents. 65 Table of Contents We do not consider it necessary for us or our competitors to obtain or maintain a proprietary patent position in order to engage in the business of biosimilar development and commercialization.
We cannot predict the impact of such changes and cannot be certain of our future compliance. We do not currently carry biological or hazardous waste insurance coverage. ​ Item 1B. Unresolved Staff Comments Not applicable. ​
We cannot predict the impact of such changes and cannot be certain of our future compliance. We do not currently carry biological or hazardous waste insurance coverage. ​ Item 1B. Unresolved Staff Comments Not applicable. ​ 71 Table of Contents
If these facilities do not pass a pre-approval plant inspection, regulatory approval of the products may not be granted or may be substantially delayed until any violations are corrected to the satisfaction of the regulatory authority, if ever.
If these facilities do not successfully complete a pre-approval plant inspection, regulatory approval of the products may not be granted or may be substantially delayed until any violations are corrected to the satisfaction of the regulatory authority, if ever.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur Board considers cybersecurity risk as part of its risk oversight function and oversees management’s implementation of our cybersecurity risk management program. 71 Table of Contents Management discusses strategic and operational risks at regular management meetings and conducts specific strategic planning and review sessions throughout the year.
Biggest changeManagement discusses strategic and operational risks at regular management meetings and conducts specific strategic planning and review sessions throughout the year.
We use a third-party consultant to provide us with advisory, project execution, and operational support in connection with cybersecurity and to conduct NIST assessments and vulnerability evaluations. • Cybersecurity awareness training of our employees, incident response personnel, and senior management.
We use a third-party consultant to provide us with advisory, project execution, and operational support in connection with cybersecurity and to conduct NIST assessments and vulnerability evaluations. • Cybersecurity awareness training of our employees, contractors, incident response personnel, and senior management.
Our management team supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the information technology environment . ​ ​ Item 2.
Our management team supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the information technology environment . ​ ​
The team has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants. Key members of our information technology management team collectively possess over 15 years of hands-on experience in implementing a diverse array of cybersecurity initiatives.
The team has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants. Key members of our information technology management team collectively possess over 16 years of hands-on experience in implementing a diverse array of cybersecurity initiatives.
As key members of our management team, our Chief Executive Officer, Interim Chief Financial Officer, and Vice President of Information Technology have approximately a combined 45 years of risk management experience and are responsible for assessing and managing our material risks from cybersecurity threats.
As key members of our management team, our Chief Executive Officer, Chief Financial Officer, and Vice President of Information Technology have approximately a combined 48 years of risk management experience and are responsible for assessing and managing our material risks from cybersecurity threats.
Our CIRT has members that include our Chief Executive Officer, Chief Financial Officer, and Vice President of Information Technology.
Our CIRT has members that include our Chief Executive Officer, Chief Financial Officer, Vice President, Corporate & Securities Law, and Vice President of Information Technology.
Their expertise spans both cloud and on-premise IT infrastructure and applications/systems, cultivated through extensive engagement across various regulated environments.
Their expertise 72 Table of Contents spans both cloud and on-premise IT infrastructure and applications/systems, cultivated through extensive engagement across various regulated environments.
Our Board of Directors encourages management to promote a culture that incorporates risk management into our corporate strategy and day-to-day business operations.
Our Board of Directors encourages management to promote a culture that incorporates risk management into our corporate strategy and day-to-day business operations. Our Board considers cybersecurity risk as part of its risk oversight function and oversees management’s implementation of our cybersecurity risk management program.
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Properties Our headquarters are located in Redwood City, California, where we occupy office space under a lease that was amended in October 2023.
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Pursuant to the amendment, we extended the term of the lease through September 30, 2027 for approximately 27,532 square feet of office space and for 20,257 square feet of previously-leased office space, the term of the lease expired on December 31, 2023.
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Our analytical and process development laboratory is located in Camarillo, California under a lease that expires in May 2027, and contains a one-time option to extend the lease term for five years. We believe that our existing facilities are adequate for our current needs.
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When our leases expire, or if we need to hire more employees, we may exercise our renewal option or look for additional or alternate space for our operations and we believe that suitable additional or alternative space will be available in the future on commercially reasonable terms. ​ Item 3.
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Legal Proceedings The information called for by this Item is incorporated herein by reference to Item 8. “Financial Statements and Supplementary Data,” Note 9. “Commitments and Contingencies.” ​ Item 4. Mine Safety Disclosures Not applicable. ​ 72 Table of Contents PART II

Item 2. Properties

Properties — owned and leased real estate

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Item 2.05 Costs Associated with Exit or Disposal Activities In addition to our 35 former employees who transferred to Sandoz in connection with the closing of the Sale Transaction, on March 11, 2024 we committed to a plan to reduce our workforce (the “Plan”) by approximately 26 employees effective March 18, 2024 to focus resources on strategic priorities including the research, development and commercialization of innovative cancer treatments and the commercialization of our portfolio of FDA-approved oncology products.
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Item 2. Properties Our headquarters are located in Redwood City, California, where we occupy office space under a lease that was amended in October 2023. Pursuant to the lease amendment, we extended the term of the lease through September 30, 2027 for approximately 27,532 square feet of office space.
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One-time restructuring charges associated with the Plan are expected to be approximately $1.5 million, primarily consisting of personnel expenses such as salaries, one-time severance payments, and other benefits. Cash payments related to these expenses will be paid out and the Plan is expected to be completed in the first half of 2024.
Added
Our analytical and process development laboratory is located in Camarillo, California under a lease that expires in May 2027, and contains a one-time option to extend the lease term for five years. We believe that our existing facilities are adequate for our current needs.
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The estimated costs that we expect to incur in connection with the Plan are subject to a number of assumptions, and actual results may differ significantly from these estimates.
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When our leases expire, or if we need to hire more employees, we may exercise our renewal option or look for additional or alternate space for our operations and we believe that suitable additional or alternative space will be available in the future on commercially reasonable terms. ​ Item 3.
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We may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, the Plan. ​ (b) During the three months ended December 31, 2023, neither we nor any of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each such term is defined in Item 408(a) of Regulation S-K. ​
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Legal Proceedings The information called for by this Item is incorporated herein by reference to Item 8. “Financial Statements and Supplementary Data,” Note 9. “Commitments and Contingencies.” ​ Item 4. Mine Safety Disclosures Not applicable. ​ PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeRecent Sales of Unregistered Equity Securities F rom January 1, 2023 through December 31, 2023, there were no sales or issuances of unregistered securities that were not otherwise reported on a Quarterly Report on Form 10-Q or Current Report on Form 8-K. 73 Table of Contents Issuer Purchases of Equity Securities We did not repurchase any of our equity securities during the fourth quarter ended December 31, 2023.
Biggest changeRecent Sales of Unregistered Equity Securities F rom January 1, 2024 through December 31, 2024, there were no sales or issuances of unregistered securities that were not otherwise reported on a Quarterly Report on Form 10-Q or Current Report on Form 8-K.
This graph shall not be deemed “soliciting material” or be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any of our filings under the Securities Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
This graph shall not be deemed “soliciting material” or be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that 73 Table of Contents Section, and shall not be deemed to be incorporated by reference into any of our filings under the Securities Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock has been listed on The Nasdaq Global Market under the symbol “CHRS” since November 6, 2014. As of February 29, 2024, there were approximately 85 stockholders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock has been listed on The Nasdaq Global Market under the symbol “CHRS” since November 6, 2014. As of February 28, 2025, there were approximately 81 stockholders of record of our common stock.
Stock Performance Graph The following graph shows the total stockholder’s return on an investment of $100 in cash at market close on December 31, 2018 through December 29, 2023 (the last trading day at the end of our fifth fiscal year) for (i) our common stock, (ii) the Nasdaq Composite Index and (iii) the Nasdaq Biotechnology Index.
Stock Performance Graph The following graph shows the total stockholder’s return on an investment of $100 in cash at market close on December 31, 2019 through December 31, 2024 for (i) our common stock, (ii) the Nasdaq Composite Index and (iii) the Nasdaq Biotechnology Index.
A total of 96,047 shares were surrendered to Coherus in the fourth quarter of 2023, to satisfy minimum tax withholding obligations in connection with the vesting or exercise of stock-based awards . ​ ​ Item 6. [Reserved]
Issuer Purchases of Equity Securities We did not repurchase any of our equity securities during the fourth quarter ended December 31, 2024. A total of 10,807 shares were surrendered to Coherus in the fourth quarter of 2024, to satisfy minimum tax withholding obligations in connection with the vesting or exercise of stock-based awards . ​ ​ Item 6. [Reserved]

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeITEM 6. [Reserved] 74 ​ ​ ​ ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 74 ​ ​ ​ ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 90 ​ ​ ​ ITEM 8. Financial Statements and Supplementary Data 91 ​ ​ ​
Biggest changeITEM 6. [Reserved] 74 ​ ​ ​ ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 74 ​ ​ ​ ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 88 ​ ​ ​ ITEM 8. Financial Statements and Supplementary Data 90 ​ ​ ​

Item 7. Management's Discussion & Analysis

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

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Biggest changeOur future funding requirements will depend on many factors, including the following: ● cash proceeds from product sales; ● the costs of manufacturing, distributing and marketing our products; ● the cost of manufacturing clinical supplies and any products that we may develop; ● the terms and timing of any other collaborative, licensing and other arrangements that we have established or may establish; ● the timing, receipt and amount of sales, profit sharing or royalties, if any, from any product candidates that are approved in the future; ● the number and characteristics of product candidates that we pursue; ● the scope, rate of progress, results and cost of our clinical trials, preclinical testing and other related activities; ● the costs of acquiring originator comparator materials and manufacturing preclinical study and clinical trial supplies and other materials from CMOs and related costs associated with release and stability testing; ● the cost, timing and outcomes of regulatory approvals; ● the cost of preparing, filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights; ● the extent to which we acquire or invest in businesses, products or technologies; ● the impact of general economic conditions on our business, including but not limited to increased interest rates and high inflation; and ● the costs of the impact from the COVID-19 pandemic and future outbreaks.
Biggest changeOur future funding requirements will depend on many factors, including the following: 85 Table of Contents ● cash proceeds from product sales; ● the payment of interest, principal and royalties related to our financial liabilities; ● the costs of manufacturing, distributing and marketing our products; ● the cost of manufacturing clinical drug supplies and establishing commercial supplies of our product candidates and products; ● the timing for our packaging and labeling CMOs to make UDENYCA products available in a sufficient quantity to meet the demand from our customers; ● the percentage of customers that continue to purchase our products and that do not switch to products made by our competitors; ● the terms and timing of any other collaborative, licensing and other arrangements that we have established or may establish; ● the timing, receipt and amount of sales, profit sharing or royalties, if any, from any product candidates that are approved in the future; ● the number and characteristics of product candidates that we pursue; ● the scope, rate of progress, results and cost of our clinical trials, preclinical testing and other related activities; ● the costs of acquiring originator comparator materials and manufacturing preclinical study and clinical trial supplies and other materials from CMOs and related costs associated with release and stability testing; ● the cost, timing and outcomes of regulatory approvals; and ● the extent to which we acquire or invest in businesses, products or technologies.
Net cash provided by financing activities Cash provided by financing activities of $69.6 million in 2023 was primarily due to proceeds of $53.6 million from the Public Offering, net of issuance costs, $18.1 million proceeds from the ATM Offering, net of issuance costs, and $1.8 million proceeds from purchase under the ESPP.
Cash provided by financing activities of $69.6 million in 2023 was primarily due to proceeds of $53.6 million from the Public Offering, net of issuance costs, $18.1 million proceeds from the ATM Offering, net of issuance costs, and $1.8 million proceeds from purchase under the ESPP.
If actual results in the future vary from our estimates, the estimates will be adjusted, which will affect net product revenue in the period that such variances become known. The most significant and judgmental gross to net revenue adjustments are for chargebacks and rebates we provide to customers, hospitals, clinics, and payers under commercial and government programs.
If actual results in the future vary from our estimates, the estimates will be adjusted, which will affect net product revenue in the period that such variances become known. The most judgmental gross to net revenue adjustments are for chargebacks and rebates we provide to customers, hospitals, clinics, and payers under commercial and government programs.
On January 10, 2024, we announced that we had delivered a notice of termination for the TIGIT Program (as defined in the Collaboration Agreement) to Junshi Biosciences pursuant to the Collaboration Agreement.
On January 10, 2024, we announced that we had delivered a notice of termination of the TIGIT Program (as defined in the Collaboration Agreement) to Junshi Biosciences pursuant to the Collaboration Agreement.
Other Updates On October 27, 2023, we announced that LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced NPC, and as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
On October 27, 2023, we announced that LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced NPC, and as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
On January 19, 2024, we entered into the Purchase Agreement by and between us and Sandoz.
On January 19, 2024, we entered into the CIMERLI Purchase Agreement by and between us and Sandoz.
Our external research and development expense consists primarily of: 79 Table of Contents ● expense incurred under agreements with collaborators, consultants, third-party CROs, and investigative sites where a substantial portion of our preclinical studies and all of our clinical trials are conducted; ● costs of acquiring originator comparator materials and manufacturing preclinical study and clinical trial supplies and other materials from CMOs, and related costs associated with release and stability testing; ● costs associated with manufacturing process development activities, analytical activities and pre-launch inventory manufactured prior to regulatory approval being obtained or deemed to be probable ; and ● upfront and certain milestone payments related to licensing and collaboration agreements.
Our external research and development expense consists primarily of: ● expense incurred under agreements with collaborators, consultants, third-party CROs, and investigative sites where a substantial portion of our preclinical studies and all of our clinical trials are conducted; ● costs of acquiring originator comparator materials and manufacturing preclinical study and clinical trial supplies and other materials from CMOs, and related costs associated with release and stability testing; ● costs associated with manufacturing process development activities, analytical activities and pre-launch inventory manufactured prior to regulatory approval being obtained or deemed to be probable ; and ● option and certain milestone payments related to licensing and collaboration agreements.
These potential payments during the ten-year period following September 8, 2023 are only due if we first receive milestone- or royalty-based payments under certain license agreements or upfront payments pursuant to ex-U.S. licensing agreements. Payments to CVR holders can be in the form of cash, stock or a combination of cash and stock.
These potential payments during the 10-year period following September 8, 2023 are only due if we first receive milestone- or royalty-based payments under certain license agreements or upfront payments pursuant to ex-U.S. licensing agreements. Payments to holders of CVRs can be in the form of cash, stock or a combination of cash and stock.
Research and Development Expense Research and development expense represents costs incurred to conduct research, such as the discovery and development of our product candidates. We recognize all research and development costs as they are incurred. We currently track research and development costs incurred on a product candidate basis only for external research and development expenses.
Research and Development Expense Research and development expense represents costs incurred to conduct research, such as the discovery and development of our product candidates. We recognize all research and development costs as they are incurred. We currently track research and 79 Table of Contents development costs incurred on a product candidate basis only for external research and development expenses.
CHS-114 is designed as a cytolytic antibody 77 Table of Contents to cause depletion of intra-tumoral Treg cells, important regulators of immune suppression and tolerance, through ADCC, and/or ADCP. CHS-114 has shown anti-tumor activity as monotherapy or in combination with anti-PD-1 antibodies in preclinical models.
CHS-114 is designed as a cytolytic antibody to cause depletion of intra-tumoral Treg cells, important regulators of immune suppression and tolerance, through ADCC, or ADCP or both. CHS-114 has shown anti-tumor activity as monotherapy or in combination with anti-PD-1 antibodies in preclinical models.
In 2023, 2022 and 2021, total sales deductions to gross product sales were 77%, 73% and 67%, respectively. Adjustments to provisions for rebates and chargebacks related to sales made in prior periods were less than 3% of the actual payments and customer credits issued in each of the years 2023 and 2022.
In 2024, 2023 and 2022, total sales deductions to gross product sales were 83%, 77% and 73%, respectively. Adjustments to provisions for rebates and chargebacks related to sales made in prior periods were less than 3% of the actual payments and customer credits issued in each of the years 2024 and 2023.
Recent Accounting Pronouncements For a description of the impact of recent accounting pronouncements, see “Note 1. Organization and Significant Accounting Policies” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K. 89 Table of Contents ​
Revenue” in the Notes to Consolidated Financial Statements in Part II, Item 8 of this Form 10-K. Recent Accounting Pronouncements For a description of the impact of recent accounting pronouncements, see “Note 1. Organization and Significant Accounting Policies” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K. ​
Personnel costs consist of salaries, benefits and stock-based compensation. Interest Expense Interest expense consists primarily of interest incurred on our outstanding indebtedness and non-cash interest related to the amortization of debt discount and debt issuance costs associated with our outstanding debt agreements.
Personnel costs consist of salaries, benefits and stock-based compensation. Interest Expense Interest expense consists primarily of interest incurred on our outstanding indebtedness, our Revenue Purchase and Sale Agreement, and non-cash interest related to the amortization of debt discount and debt issuance costs associated with our outstanding debt agreements.
A change of 10% in our total provisions for product sales discounts and allowances as of December 31, 2023, would have resulted in a change of our pre-tax earnings in 2023 by approximately $24.5 million. A summary of the activities and ending reserve balances for each significant category of discounts and allowances, can be found in “Note 2.
A change of 10% in our total provisions for product sales discounts and allowances as of December 31, 2024, would have resulted in a change of our pre-tax earnings in 2024 by approximately $27.6 million. A summary of the activities and ending reserve balances for each significant category of discounts and allowances, can be found in “Note 2.
This MD&A section generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022.
This MD&A section generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Our non-cancelable purchase commitments as of December 31, 2023 were $73.1 million, as outlined in “Note 9. Commitments and Contingencies” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K.
Our non-cancelable purchase commitments as of December 31, 2024 were $86.5 million, as outlined in “Note 9. Commitments and Contingencies” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K.
The lead clinical stage product candidate from the Surface Acquisition is casdozokitug (CHS-388, formerly SRF388), an investigational antibody targeting IL-27, an immune regulatory cytokine, or protein that is overexpressed in certain cancers, including hepatocellular, lung and renal cell carcinoma.
Our lead clinical stage product candidate is casdozokitug (CHS-388, formerly SRF388), an investigational antagonist antibody targeting IL-27, an immune regulatory cytokine, that is overexpressed in certain cancers, including hepatocellular, lung and renal cell carcinoma.
Selling, General and Administrative Expense Selling, general and administrative expense consists primarily of personnel costs, allocated facilities costs and other expense for outside professional services, including legal, insurance, human resources, outside marketing, advertising, audit and accounting services, acquisition-related costs, as well as costs associated with establishing commercial capabilities in support of the commercialization of UDENYCA, CIMERLI, YUSIMRY and LOQTORZI.
Selling, General and Administrative Expense Selling, general and administrative expense consists primarily of personnel costs, allocated facilities costs and other expense for outside professional services, including legal, insurance, human resources, outside marketing, advertising, audit and accounting services, certain transaction costs, and costs associated with establishing commercial capabilities in support of the commercialization of UDENYCA and LOQTORZI and the commercialization of CIMERLI and YUSIMRY up until the CIMERLI Sale and the YUSIMRY Sale, respectively.
Casdozokitug is currently in two on-going clinical studies a Phase 1/2 study in advanced solid tumors (clinicaltrials.gov identifier# NCT04374877) and a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861). ● CHS-114 (formerly SRF114), is an investigational highly specific human afucosylated IgG1 monoclonal antibody selectively targeting CCR8, a chemokine receptor highly expressed on Treg cells in the TME.
Casdozokitug is currently in three on-going clinical studies, including a Phase 1/2 study in advanced solid tumors (clinicaltrials.gov identifier# NCT04374877), a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861) and a randomized Phase 2 study in HCC evaluating casdozokitug in combination with toripalimab and bevacizumab (clinicaltrials.gov identifier# NCT06679985). 77 Table of Contents ● CHS-114 (formerly SRF114), is an investigational highly specific human afucosylated IgG1 monoclonal antibody selectively targeting CCR8, a chemokine receptor highly expressed on Treg cells in the TME.
Net cash provided by (used in) investing activities Cash provided by investing activities of $144.6 million in 2023 was primarily due to proceeds from maturities of investments in marketable securities of $144.4 million, proceeds from sale of investments in marketable securities of $13.3 million, and $7.0 million of cash acquired from the Surface Acquisition, partially offset by purchases of investments in marketable securities of $19.5 million and a $1.1 million upfront milestone payment due to the first commercial sale of YUSIMRY.
Cash provided by investing activities of $144.6 million in 2023 was primarily due to proceeds from maturities of investments in marketable securities of $144.4 million, proceeds from sale of investments in marketable securities of $13.3 million, and $7.0 million of cash acquired as part of the Surface Acquisition, partially offset by purchases of investments in marketable securities of $19.5 million.
For example, our partners in licensed territories may exert considerable influence on the regulatory filing process globally. Therefore, we cannot forecast with any degree of certainty the duration and completion costs of these or other current or future clinical trials of our product candidates. We may never succeed in achieving regulatory approval for any of our pipeline product candidates.
Therefore, we cannot forecast with any degree of certainty the duration and completion costs of these or other current or future clinical trials of our product candidates. We may never succeed in achieving regulatory approval for any of our pipeline product candidates.
Another product, CIMERLI (ranibizumab-eqrn), was approved by the FDA in August 2022 as a biosimilar product interchangeable with Lucentis (ranibizumab injection) for the treatment of neovascular (wet) age-related macular degeneration, macular edema following retinal vein occlusion, diabetic macular edema, diabetic retinopathy, and myopic choroidal neovascularization. We launched CIMERLI commercially in the United States in October 2022.
Ophthalmology – Sold to Sandoz pursuant to the CIMERLI Sale ● CIMERLI (ranibizumab-eqrn), a Lucentis biosimilar, was approved by the FDA on August 2, 2022 for the treatment of neovascular (wet) age-related macular degeneration, macular edema following retinal vein occlusion, diabetic macular edema, diabetic retinopathy, and myopic choroidal neovascularization and we launched CIMERLI commercially in the United States on October 3, 2022.
We are also pursuing an early-stage development candidate that is in investigational new drug application-enabling studies, CHS-1000, an antibody targeting human ILT4, designed to improve anti-PD-1 clinical benefit by transforming an unfavorable TME to a more favorable TME.
We also have an early-stage development candidate, CHS-1000, an investigational antibody targeting human ILT4, designed to improve anti-PD-1 clinical benefit by transforming an unfavorable TME to a more favorable TME.
Contingent Milestones We have obligations to make future payments to third parties that become due and payable upon the achievement of certain development, regulatory and commercial milestones (such as clinical trial achievements, the filing of a BLA, approval by the FDA or product launch).
For further discussion of risks related to our financial condition and capital requirements, please see “Risk Factors—Risks Related to Our Financial Condition and Capital Requirements.” Contingent Milestones We have obligations to make future payments to third parties that become due and payable upon the achievement of certain development, regulatory and commercial milestones (such as clinical trial achievements, the filing of a BLA, approval by the FDA or product launch).
Casdozokitug is currently in two on-going clinical studies, a Phase 1/2 study in patients with advanced solid tumors (clinicaltrials.gov identifier# NCT04374877) and a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861).
Casdozokitug is currently in three on-going clinical studies, including a Phase 1/2 study in patients with advanced solid tumors, including in combination with toripalimab in non-small cell lung cancer (clinicaltrials.gov identifier# NCT04374877), and a Phase 2 study in HCC (clinicaltrials.gov identifier# NCT05359861).
Due to its immune regulatory nature, there is a rationale for inhibiting IL-27 to treat cancer, as this approach will influence the activity of multiple types of immune cells that are necessary to recognize and attack a tumor. Casdozokitug received orphan drug designation and fast track designation from the FDA for the treatment of HCC in November 2020.
Due to its immune regulatory nature, there is a rationale for inhibiting IL-27 to treat cancer, as this approach will influence the activity of multiple types of immune cells that are necessary to recognize and attack a tumor.
GSK4381562 is an antibody targeting CD112R, also known as PVRIG, an inhibitory protein expressed on NK and T cells. GSK4381562 blocks the interaction of CD112R with CD112, its binding partner that is expressed on tumor cells. GSK4381562 can promote the activation of both NK and T cells, with potential to elicit a strong anti-tumor response and promote immunological memory.
GSK4381562 is designed to block the interaction of PVRIG with CD112, its binding partner that is expressed on tumor cells. GSK4381562 is designed to promote the activation of both NK and T cells, with potential to elicit a strong anti-tumor response and promote immunological memory.
With the exception of $25.0 million for a milestone payment to Junshi Biosciences, of which we expect to pay $12.5 million in the second quarter of 2024 and $12.5 million in the first quarter of 2025, as of December 31, 2023, no other milestones were accrued because their probability of achievement had not reached the threshold for recognition. 86 Table of Contents ​ The following table presents a summary of our active partnerships and collaborations that have contingent regulatory and sales milestones as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ Counterparty ​ Description ​ Potential Aggregate Milestone Amount Junshi Biosciences ​ LOQTORZI ​ $355.0 million (1) ​ ​ CHS-006 anti-TIGIT antibody ​ $255.0 million (2) Adimab ​ Casdozokitug ​ $13.0 million Vaccinex ​ CHS-114 ​ $15.0 million ​ (1) $290.0 million relates to sales milestones and $65.0 million relates to regulatory milestones, excluding the $25.0 million milestone payment to Junshi Biosciences, of which we expect to pay $12.5 million in the second quarter of 2024 and $12.5 million in the first quarter of 2025.
With the exception of $12.5 million for the second half of a milestone payment to Junshi Biosciences that was paid in January of 2025, as of December 31, 2024, no other milestones were accrued because their probability of achievement had not reached the threshold for recognition. ​ The following presents a summary of our active partnerships and collaborations that have contingent regulatory and sales milestones as of December 31, 2024: ​ ​ ​ ​ ​ ​ Counterparty ​ Description ​ Remaining Potential Aggregate Milestone Amount Junshi Biosciences ​ LOQTORZI ​ $355.0 million (1) Adimab ​ Casdozokitug ​ $13.0 million Vaccinex ​ CHS-114 ​ $15.0 million ​ (1) $290.0 million relates to sales milestones and $65.0 million relates to regulatory milestones for indications that are not currently the subject of our clinical trials.
Expenses in 2023 and 2022 primarily related to manufacturing efforts for new formulations and clinical studies. 80 Table of Contents (3) In October 2023, LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced NPC, and for LOQTORZI as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
(2) In October 2023, LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced NPC, and for LOQTORZI as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
Pursuant to the terms and subject to the conditions set forth in the Purchase Agreement, on March 1, 2024, we completed the divestiture of our CIMERLI ophthalmology franchise through the sale of our subsidiary, Coherus Ophthalmology LLC, to Sandoz for upfront, all-cash consideration of $170.0 million plus an additional $17.8 million for CIMERLI product inventory and prepaid manufacturing assets.
Pursuant to the terms and subject to the conditions set forth in the CIMERLI Purchase Agreement, on March 1, 2024, we completed the divestiture of our CIMERLI ophthalmology franchise through the sale of our subsidiary, Coherus Ophthalmology, to Sandoz for upfront, all-cash consideration of $170.0 million plus an additional $17.8 million for CIMERLI product inventory and prepaid manufacturing assets. ​ License Agreement with Junshi Biosciences On February 1, 2021, we entered into the Collaboration Agreement with Junshi Biosciences for the co-development and commercialization of LOQTORZI, Junshi Biosciences’ anti-PD-1 antibody in the United States and Canada.
Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 that are not included in this Form 10-K 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 6, 2023.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K 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 March 15, 2024. 74 Table of Contents Overview We are a commercial-stage biopharmaceutical company focused on the research, development and commercialization of innovative immunotherapies to treat cancer.
Such consideration is subject to certain adjustments that will be finalized following the closing pursuant to the Purchase Agreement. ​ License Agreement with Junshi Biosciences On February 1, 2021, we entered into the Collaboration Agreement with Junshi Biosciences for the co-development and commercialization of LOQTORZI, Junshi Biosciences’ anti-PD-1 antibody in the United States and Canada. 78 Table of Contents Under the terms of the Collaboration Agreement, we paid $150.0 million upfront for exclusive rights to LOQTORZI in the United States and Canada, an option in these territories to Junshi Biosciences’ anti-TIGIT antibody CHS-006, an option in these territories to a next-generation engineered IL-2 cytokine, and certain negotiation rights to two undisclosed preclinical immuno-oncology drug candidates.
Under the terms of the Collaboration Agreement, we paid $150.0 million upfront for exclusive rights to LOQTORZI in the United States and Canada, an option in these territories to Junshi Biosciences’ anti-TIGIT antibody CHS-006, an option in these territories to a 78 Table of Contents next-generation engineered IL-2 cytokine, and certain negotiation rights to two undisclosed preclinical immuno-oncology drug candidates.
We will have the right to conduct all commercial activities of LOQTORZI in the United States and Canada. We are obligated to pay Junshi Biosciences up to a 20% royalty on net sales of LOQTORZI and up to an aggregate $380.0 million in one-time payments for the achievement of various regulatory and sales milestones.
We are obligated to pay Junshi Biosciences up to an aggregate $380.0 million in one-time payments for the achievement of various regulatory and sales milestones, of which we have already paid $25.0 million, and a royalty in the low twenty percent range on net sales of LOQTORZI.
UDENYCA ONBODY became commercially available in the first quarter of 2024. ● LOQTORZI was developed for its ability to block PD-1 interactions with its ligands, PD-L1 and PD-L2, by binding to the FG loop on the PD-1 receptor.
We anticipate the transactions contemplated by the UDENYCA Purchase Agreement to close late in the first quarter or early in the second quarter of 2025. ● LOQTORZI was developed for its ability to block PD-1 interactions with its ligands, PD-L1 and PD-L2, by binding to the FG loop on the PD-1 receptor.
As a result, cost of goods sold reflects a mid-single digit royalty on UDENYCA net product revenue, which began July 1, 2019 and continues for five years from then.
As a result, cost of goods sold for the five-year period ending on July 1, 2024 reflects a mid-single digit royalty on UDENYCA net product revenue.
Cash used in operating activities of $241.1 million in 2022 was primarily due to the net loss of $291.8 million adjusted for the classification of the cash option payment to Junshi Biosciences of $35.0 million to investing activities, non-cash items including stock-based compensation expense of $50.7 million, net inventory write-downs of $26.0 million and other non-cash adjustments of $18.2 million, partially offset by the changes in our operating assets and liabilities of $79.3 million.
Cash used in operating activities of $174.9 million in 2023 was primarily due to the net loss of $237.9 million adjusted for non-cash items including net inventory write-downs of $52.6 million, stock-based compensation expense of $43.1 million and other non-cash adjustments of $4.1 million, partially offset by the changes in our operating assets and liabilities of $36.8 million.
We announced the launch of LOQTORZI in the U.S. on January 2, 2024. ​ ● Casdozokitug ( CHS-388, formerly SRF388), is an investigational recombinant human IgG1 monoclonal antibody targeting IL-27, an immune regulatory cytokine, or protein that is overexpressed in certain cancers, including hepatocellular, lung and renal cell carcinoma.
On June 27, 2024, we entered into the Canada License Agreement with Apotex, pursuant to which, we granted to Apotex an exclusive license under our rights to toripalimab to commercialize toripalimab within Canada. ● Casdozokitug (CHS-388, formerly SRF388), is an investigational recombinant human IgG1 monoclonal antibody targeting IL-27, an immune regulatory cytokine, or protein that is overexpressed in certain cancers, including hepatocellular, lung and renal cell carcinoma.
Critical Accounting Estimates The preparation of our consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S.
These were partially offset by $3.6 million in tax payments related to net share settlement. Critical Accounting Estimates The preparation of our consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S.
CIMERLI Divestment Transaction On January 19, 2024, we entered into the Purchase Agreement by and between us and Sandoz.
On December 2, 2024, we entered into the UDENYCA Purchase Agreement by and between us and Intas.
Product Sales Discounts and Allowances ​ We recognize revenue when a customer obtains control of the product, which generally occurs upon delivery to and acceptance by the customer.
These estimates form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Product Sales Discounts and Allowances ​ We recognize revenue when a customer obtains control of the product, which generally occurs upon delivery to and acceptance by the customer.
Our second clinical-stage product candidate from the Surface Acquisition, CHS-114 (formerly SRF114), is an investigational IgG1 antibody targeting CCR8, a chemokine receptor highly expressed on Treg cells in the TME.
We initiated a randomized Phase 2 study in HCC evaluating casdozokitug in combination with toripalimab and bevacizumab in the fourth quarter of 2024 (clinicaltrials.gov identifier# NCT06679985). Our second clinical-stage product candidate, CHS-114 (formerly SRF114), is an investigational IgG1 antibody targeting CCR8, a chemokine receptor highly expressed on Treg cells in the TME.
We will pay 70% of all milestone- and royalty-based payments that we or our affiliates actually receive from the product candidates licensed to Novartis Institutes and GSK during the ten-year period following the entry into the CVR Agreement to the holders of the CVRs. ​ Immunology ● YUSIMRY, a biosimilar of Humira (adalimumab), is a monoclonal antibody that can bind to TNF.
Through September 2033, we have an obligation to pay 70% of all milestone- and royalty-based payments that we or our affiliates receive from GSK4381562 to the holders of CVRs. Immunology – Sold to HKF pursuant to the YUSIMRY Sale ● YUSIMRY (adalimumab-aqvh), a biosimilar of Humira (adalimumab), is a monoclonal antibody that can bind to TNF.
As of December 31, 2023, no payments are due to CVR holders. For further details, see “Note 6. Surface Acquisition” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K.
Financial Liabilities” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K.
Contingent Value Rights ​ We have recorded a contingent consideration liability for the fair value of the potential payments under the CVR Agreement in connection with the Surface Acquisition.
Contingent Value Rights ​ We have recorded a contingent consideration liability for the fair value of the potential payments under the Contingent Value Rights Agreement, dated September 8, 2023, by and among the Company and Computershare Inc. and its affiliate Computershare Trust Company, N.A., together, as the rights agent thereunder (the “CVR Agreement”) in connection with the Surface Acquisition.
As of December 31, 2023, we have accrued a $25.0 million milestone payment to Junshi Biosciences, of which we expect to pay $12.5 million in the second quarter of 2024 and $12.5 million in the first quarter of 2025, as well as an immaterial royalty obligation.
The $35.0 million payment for the option to license CHS-006 was reflected in our first quarter of 2022 financial statements. As of December 31, 2024, we had an accrued expense of $12.5 million for a milestone payable to Junshi Biosciences, which was paid in January 2025, as well as $1.5 million for our royalty obligation.
The following table summarizes our research and development expense incurred during the respective periods: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Development Status as of ​ Year Ended December 31, (in thousands) December 31, 2023 2023 2022 External costs incurred by product candidate: ​ ​ UDENYCA Approved (1) ​ $ 4,476 ​ $ 17,358 YUSIMRY Approved (2) ​ 7,273 ​ 26,309 LOQTORZI ​ Approved (3) ​ ​ 17,192 ​ ​ 36,871 CHS-006 (option terminated) ​ Clinical Trials (4) ​ ​ 5,833 ​ ​ 39,650 CHS-1000 ​ Development ​ ​ 7,105 ​ ​ 2,671 Casdozokitug ​ Development (5) ​ ​ 4,129 ​ ​ — CHS-114 ​ Development (5) ​ ​ 1,429 ​ ​ — Other discontinued projects ​ Discontinued (6) ​ ​ 23 ​ ​ 1,007 Other research and development expenses (7) ​ 2,826 ​ 1,838 Internal costs ​ 59,150 ​ 73,654 Total research and development expenses ​ $ 109,436 ​ $ 199,358 ​ (1) Expenses related primarily to development efforts to obtain PAS for additional presentations of UDENYCA.
The following table summarizes our research and development expense incurred during the respective periods: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Development Status as of ​ Year Ended December 31, (in thousands) December 31, 2024 2024 2023 External costs incurred by product candidate: ​ ​ Casdozokitug ​ Clinical trials (1) ​ $ 16,588 ​ $ 4,129 CHS-114 ​ Clinical trials (1) ​ ​ 7,847 ​ ​ 1,429 CHS-1000 ​ IND approved ​ ​ 2,773 ​ ​ 7,105 LOQTORZI ​ Approved (2) ​ ​ 13,290 ​ ​ 17,192 UDENYCA Approved (3) ​ ​ 3,612 ​ ​ 4,476 YUSIMRY Divested (4) ​ 545 ​ 7,273 CIMERLI ​ Divested (5) ​ ​ 699 ​ ​ 683 Other discontinued projects ​ Discontinued (6) ​ ​ 2,305 ​ ​ 5,856 Other research and development expenses ​ 1,430 ​ 2,143 Internal costs ​ 44,247 ​ 59,150 Total research and development expenses ​ $ 93,336 ​ $ 109,436 ​ (1) We acquired casdozokitug and CHS-114 in connection with the acquisition of Surface (the “Surface Acquisition”) in September 2023.
Other Income (Expense), Net Other income (expense), net consists primarily of interest earned on our cash and cash equivalents, non-cash accretion of discount on our investments in marketable securities, foreign exchange gains (losses) resulting from currency fluctuations, and gains (losses) from disposal of long-lived assets.
Other Income (Expense), Net Other income (expense), net consists primarily of interest earned on our cash and cash equivalents, non-cash accretion of discount on our investments in marketable securities, foreign exchange gains (losses) resulting from currency fluctuations, gains (losses) from financial instruments including the change in fair value of the embedded derivative contained in the Revenue Purchase and Sale Agreement that meets the criteria to be bifurcated and accounted for separately from the Revenue Purchase and Sale Agreement (the "Royalty Fee Derivative Liability"), gains (losses) from disposal of long-lived assets, and income related to services provided under transition service agreements.
We recognized $0.4 million of income tax benefit for the year ended December 31, 2023.
In 2023, income tax provision (benefit) consists of the change in deferred tax balances resulting from the recognition of a deferred tax liability related to the Surface Acquisition, and we recognized $0.4 million of income tax benefit for the year ended December 31, 2023.
In March 2022, we paid $35.0 million for the exercise of our option to license CHS-006. Subsequent joint development consistent with the Collaboration Agreement commenced. On January 10, 2024, we announced that we had delivered a notice of termination of the TIGIT Program (as defined in the Collaboration Agreement) to Junshi Biosciences pursuant to the Collaboration Agreement.
On June 27, 2024, we entered into the Canada License Agreement pursuant to which, we granted to Apotex an exclusive license under our rights to toripalimab to commercialize toripalimab within Canada. In March 2022, we paid $35.0 million for the exercise of our option to license CHS-006. Subsequent joint development consistent with the Collaboration Agreement commenced.
Furthermore, in the past, we have entered into collaborations with third parties to participate in the development and commercialization of our product candidates, and we may enter into additional collaborations in the future. In situations in which third parties have substantial influence over the development activities for product candidates, the estimated completion dates are not fully under our control.
In situations in which third parties have substantial influence over the development activities for product candidates, the estimated completion dates are not fully under our control. For example, our partners in licensed territories may exert considerable influence on the regulatory filing process globally.
Summary Statement of Cash Flows The following table summarizes our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, (in thousands) 2023 2022 Net cash used in operating activities ​ $ (174,884) ​ $ (241,124) Net cash provided by (used in) investing activities ​ 144,640 ​ (166,850) Net cash provided by financing activities ​ ​ 69,600 ​ ​ 54,326 Net increase (decrease) in cash, cash equivalents and restricted cash ​ $ 39,356 ​ $ (353,648) ​ 87 Table of Contents Net cash used in operating activities Cash used in operating activities of $174.9 million for the year ended December 31, 2023 was primarily due to the net loss of $237.9 million adjusted for non-cash items including net inventory write-downs of $52.6 million, stock-based compensation expense of $43.1 million and other non-cash adjustments of $4.1 million, partially offset by the changes in our operating assets and liabilities of $36.8 million.
Summary Statement of Cash Flows The following table summarizes our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (in thousands) ​ 2024 2023 Net cash used in operating activities ​ $ (20,440) ​ $ (174,884) Net cash provided by investing activities ​ ​ 230,321 ​ 144,640 Net cash (used in) provided by financing activities ​ ​ (186,974) ​ ​ 69,600 Net increase in cash, cash equivalents and restricted cash ​ $ 22,907 ​ $ 39,356 ​ Net cash used in operating activities Cash used in operating activities of $20.4 million in 2024 was primarily the result of net adjustments of $104.8 million against our net income of $28.5 million plus changes in our operating assets and liabilities of $55.9 million.
We are enrolling patients with advanced solid tumors in North America in a clinical trial evaluating safety and pharmacokinetics of CHS-114 (clinicaltrials.gov identifier# NCT05635643). ● We are pursuing an early-stage development candidate, CHS-1000, an antibody targeting human ILT4, designed to improve anti-PD-1 clinical benefit by transforming an unfavorable TME to a more favorable TME.
We plan to initiate a Phase 1b clinical study of CHS-114 in combination with toripalimab in second-line HNSCC (clinicaltrials.gov identifier# NCT05635643) and to initiate a Phase 1b clinical study of CHS-114 in combination with toripalimab and/or other treatments in participants with advanced solid tumors with the first cohort evaluating gastric cancer (clinicaltrials.gov identifier# NCT06657144), each in the first quarter of 2025. ● CHS-1000 is an investigational antibody targeting human ILT4, designed to improve anti-PD-1 clinical benefit by transforming an unfavorable TME to a more favorable TME.
Excluding the potential impact of any acquisitions or business development transactions that have not been consummated, we expect our selling, general and administrative expense for the full year 2024 to be lower than the full year 2023 primarily as a result of the CIMERLI Sale Transaction, reduced headcount and decreased commercial costs.
Notwithstanding the retrospective reporting for discontinued operations, we expect our selling, general and administrative expense for the full year 2025 to be lower than the full year 2024 primarily as a result of decreased operating costs and headcount due to the divestitures .
These were partially offset by fully repaying $109.0 million on the 2022 Convertible Notes and $81.8 million on the 2025 Term Loan (excluding interest which is presented as an operating activity), and $3.7 million in tax payments related to net share settlement of RSUs.
Net cash (used in) provided by financing activities Cash used in financing activities of $187.0 million in 2024 was primarily due to $260.4 million in payments to fully repay the 2027 Term Loans (excluding interest which is presented as an operating activity) and $2.5 million in tax payments related to net share settlement of RSUs.
Leases ​ We lease office and laboratory facilities through arrangements treated as operating leases, and we lease vehicles through finance leases. Refer to “Note 10. Leases” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K for additional information to our leases.
Leases” in the Notes to Consolidated Financial Statements contained in Part II, Item 8 of this Annual Report on Form 10-K for additional information to our leases. Our total non-cancelable contractual obligations arising from these agreements as of December 31, 2024 was $5.8 million, with $2.2 million of these obligations due within twelve months.
We have funded our operations primarily through sales of our common stock, issuance and incurrence of convertible and term debt and sales of our products. On January 19, 2024, we entered into the Purchase Agreement by and between us and Sandoz.
On December 2, 2024, we announced the UDENYCA Sale for $483.4 million in cash, inclusive of $118.4 million of UDENYCA product inventory, subject to other requirements. 84 Table of Contents We have funded our operations primarily through sales of our common stock, issuance and incurrence of convertible and term debt, the Revenue Purchase and Sale Agreement, the Sale Transactions and sales of our products.
Additionally, w e share a percentage of gross profits on sales of Bioeq Licensed Products in the United States with Bioeq in the low- to mid-fifty percent range, and pursuant to the Genentech Agreement we incur a royalty that is a low single-digit percentage of net sales of CIMERLI that was incurred through the end of 2023 but that is no longer owed.
Additionally, until the CIMERLI Sale on March 1, 2024, w e shared a percentage of gross profits on sales of CIMERLI in the United States with Bioeq AG (“Bioeq”) in the low- to mid-fifty percent range. Cost of goods sold includes a royalty in the low twenty percent range on net sales of LOQTORZI.
Research and Development Expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (in thousands) 2023 2022 Change Research and development ​ $ 109,436 ​ $ 199,358 ​ $ (89,922) ​ The decrease in research and development expense was primarily due to: ● the first quarter of 2022 including an upfront payment of $35.0 million to exercise our option to license CHS-006, a TIGIT-targeted antibody, in the United States and Canada; ● a decrease of $19.0 million in YUSIMRY costs primarily due to certain manufacturing costs for YUSIMRY being capitalized since mid-2022, as well as completion of key studies in the second half of 2022; ● a decrease of $18.5 million in co-development costs for LOQTORZI and CHS-006 resulting from reducing the scope of the development plan for LOQTORZI in the United States beginning in 2023; ● a decrease of $12.9 million in costs to develop additional presentations of UDENYCA; ● a decrease of $10.0 million in personnel and stock-based compensation expense primarily due to fewer employees; and ● a decrease of $4.5 million in facilities, supplies and materials and other infrastructure related expenses to support our research and development programs.
Research and Development Expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (in thousands) ​ 2024 2023 Change Research and development ​ $ 93,336 ​ $ 109,436 ​ $ (16,100) ​ The decrease in research and development expense was primarily due to: ● a net decrease of $14.5 million in personnel costs including stock-based compensation expense, primarily due to a decrease in headcount and restructuring charges of $3.6 from our reduction in force in the first quarter of 2023; ● a decrease of $7.4 million in co-development costs for toripalimab and CHS-006 resulting from reducing the scope of the development plan for toripalimab in the United States beginning in 2023 and the termination of the TIGIT Program announced in January 2024; ● a decrease of $6.7 million in external costs related to YUSIMRY; and ● a decrease of $4.3 million for fewer expenditures during the period for the development of CHS-1000.
LOQTORZI is an anti-PD-1 antibody that we developed in collaboration with Junshi Biosciences.
LOQTORZI is an anti-PD-1 antibody that we developed in collaboration with Junshi Biosciences that is currently the only immune checkpoint inhibitor approved by the FDA for the treatment of these indications. We announced the launch of LOQTORZI in the U.S. on January 2, 2024.
We expect our research and development expense in 2024 to be lower than in 2023, as CHS-006 co-development with Junshi Biosciences has been terminated and we continue our focus on cost containment across multiple functions. 82 Table of Contents Selling, General and Administrative Expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (in thousands) 2023 2022 Change Selling, general and administrative ​ $ 192,015 ​ $ 198,481 ​ $ (6,466) ​ The decrease in selling, general and administrative expense was primarily due to lower average headcount, including reductions of $9.9 million in employee and consultant costs and $3.1 million in stock-based compensation.
Selling, General and Administrative Expense ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, (in thousands) 2024 2023 Change Selling, general and administrative ​ $ 167,738 ​ $ 192,015 ​ $ (24,277) ​ The decrease in selling, general and administrative expense was driven primarily by lower headcount, including reductions of $21.3 million in employee, consultant and travel costs, $9.8 million in stock-based compensation, and decreased operating costs following divestitures.
The largest component of our total operating expense has historically been our investment in research and development activities, including the licensing and collaboration costs, clinical development and manufacturing process development of our product candidates. The process of conducting the necessary clinical research to obtain regulatory approval is costly and time consuming.
The process of conducting the necessary clinical research to obtain regulatory approval is costly and time consuming. Furthermore, in the past, we have entered into collaborations with third parties to participate in the development and commercialization of our product candidates, and we may enter into additional collaborations in the future.
CHS-114 is designed to cause depletion of intra-tumoral Treg cells, important regulators of immune suppression and tolerance, through ADCC, or ADCP, or both, that has shown anti-tumor activity in preclinical models. We are enrolling patients with advanced solid tumors in North America in a clinical trial evaluating safety and pharmacokinetics of CHS-114 (clinicaltrials.gov identifier# NCT05635643).
We are enrolling patients with advanced solid tumors and HNSCC in the U.S. in a clinical trial evaluating safety and pharmacokinetics of CHS-114 with and without LOQTORZI (clinicaltrials.gov identifier# NCT05635643).
We plan to submit an IND to the FDA in the second quarter of 2024 for CHS-1000. ● In addition to our internally developed portfolio of product candidates that we obtained in the Surface Acquisition, we also own NZV930 and GSK4381562, which are exclusively licensed to Novartis Institutes and GSK, respectively.
Our IND for CHS-1000 was allowed to proceed by the FDA in the second quarter of 2024 and initiating the first-in-human clinical study remains subject to further evaluation in our portfolio prioritization process. In addition, we have a product candidate, GSK4381562, which is exclusively licensed to GSK.
We believe blocking PD-1 interactions with PD-L1 and PD-L2 can help to promote the immune system’s ability to attack and kill tumor cells. ​ On October 27, 2023, we announced that LOQTORZI was approved by the FDA in combination with cisplatin and gemcitabine for the first-line treatment of adults with metastatic or recurrent locally advanced NPC, and as monotherapy for the treatment of adults with recurrent, unresectable, or metastatic NPC with disease progression on or after platinum-containing chemotherapy.
We believe blocking PD-1 interactions with PD-L1 and PD-L2 can help to promote the immune system’s ability to attack and kill tumor cells.
Such consideration is subject to certain adjustments that will be finalized following the closing pursuant to the Purchase Agreement. Cost of Goods Sold Cost of goods sold consists primarily of third-party manufacturing, distribution, certain overhead costs, and royalties on certain products.
Cost of Goods Sold Cost of goods sold consists primarily of third-party manufacturing, distribution, certain overhead costs, and royalties on certain products. On May 2, 2019, we settled a trade secret action brought by Amgen.
We believe that our available cash, cash equivalents, marketable securities, cash collected from product sales and ATM Offering and Public Offering proceeds received to date will be sufficient to fund our planned expenditures and meet our obligations for at least the twelve months following our financial statement issuance date.
Based on individual distributor historical purchasing patterns, supply allocations to wholesalers for all three presentations of UDENYCA were removed between the end of January 2025 and the end of February 2025. ​ Irrespective of whether the UDENYCA Sale is consummated, we believe that our available cash, cash equivalents, and cash collected from product sales and services provided under transition service agreements will be sufficient to fund our planned expenditures and meet our obligations for at least the twelve months following the date of this Annual Report on Form 10-K.
Due to its immunosuppressive nature, there is a rationale for inhibiting IL-27 to treat cancer, as this approach will influence the activity of multiple types of immune cells that are necessary to recognize and attack a tumor. Casdozokitug received orphan drug designation and fast track designation from the FDA for the treatment of HCC in November 2020.
Casdozokitug received orphan drug designation from the FDA for the treatment of HCC in October 2020 and fast track designation from the FDA for the treatment of HCC in November 2020.
Cash used in investing activities of $166.9 million in 2022 was primarily due to purchases of investments in marketable securities of $127.4 million, the option fee payment of $35.0 million to license CHS-006 from Junshi Biosciences, a $2.4 million milestone payment to Bioeq related to the launch of CIMERLI, and purchases of property and equipment of $2.0 million.
Net cash provided by investing activities Cash provided by investing activities of $230.3 million in 2024 was primarily due to $187.8 million of cash acquired from the CIMERLI Sale, $40.0 million of cash received from the YUSIMRY Sale, proceeds from the sale of investments in marketable securities of $8.7 million and proceeds from maturities of investments in marketable securities of $6.2 million, partially offset by the milestone payment to Junshi Biosciences of $12.5 million.
No income tax provision or benefit was recognized for the year ended December 31, 2022. 83 Table of Contents Liquidity and Capital Resources ​ Certain relevant measures of our liquidity and capital resources are summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ December 31, (in thousands) 2023 2022 Financial assets ​ ​ ​ ​ ​ ​ ​ Total Cash, cash equivalents and marketable securities ​ $ 117,748 ​ ​ $ 191,681 ​ ​ ​ ​ ​ ​ ​ ​ Debt obligations: ​ ​ ​ ​ ​ 2027 Term Loans ​ $ 246,481 ​ ​ $ 245,483 2026 Convertible Notes ​ 226,888 ​ ​ 225,575 Total debt obligations ​ $ 473,369 ​ ​ $ 471,058 ​ Although we were profitable in 2020 and 2019, due to our research and development expenditures and decline in revenue beginning in 2021, we have generated significant operating losses in all other years since our inception, including in 2023 and 2022.
Liquidity and Capital Resources ​ Certain relevant measures of our liquidity and capital resources are summarized as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, (in thousands) 2024 2023 Financial assets ​ ​ ​ ​ ​ ​ Total Cash, cash equivalents and marketable securities ​ $ 125,987 ​ $ 117,748 ​ ​ ​ ​ ​ ​ ​ Financial liabilities (1) : ​ ​ ​ ​ 2029 Term Loan ​ $ 36,698 ​ $ — Revenue Purchase and Sale Agreement ​ ​ 28,743 (2) ​ ​ — 2027 Term Loans ​ ​ — ​ ​ 246,481 2026 Convertible Notes ​ 228,229 (2) ​ 226,888 Total Financial liabilities ​ $ 293,670 ​ $ 473,369 ​ (1) See “Note 8.
Removed
Overview We are a commercial-stage biopharmaceutical company focused on the research, development and commercialization of innovative cancer treatments and the commercialization of our portfolio of FDA-approved oncology products, including LOQTORZI. Our strategy is to build a leading immuno-oncology business funded with cash generated from our diversified portfolio of FDA-approved therapeutics.
Added
Our commercial portfolio includes our first product, UDENYCA (pegfilgrastim-cbqv), a biosimilar to Neulasta, a long-acting G-CSF, and LOQTORZI, a novel next-generation PD-1 inhibitor. We are developing an innovative immuno-oncology pipeline that is expected to bring forward new potential indications for LOQTORZI in the U.S. and the development of new product candidates.
Removed
As of March 15, 2024, our commercial portfolio includes two FDA-approved biosimilar products. Our first product, UDENYCA, a biosimilar to Neulasta, a long-acting G-CSF, was launched commercially in the United States in January 2019.
Added
UDENYCA was launched commercially in a pre-filled syringe presentation in the United States in January 2019, followed by the launch of UDENYCA in an autoinjector presentation in May 2023 and the launch of UDENYCA ONBODY in February 2024.
Removed
The FDA approved the PAS for an AI presentation of UDENYCA on March 3, 2023, and on May 22, 2023 we announced the availability of UDENYCA AI for commercial sale. On December 26, 2023 we announced that the FDA approved the PAS for our third pegfilgrastim presentation, UDENYCA ONBODY. UDENYCA ONBODY became commercially available in the first quarter of 2024.
Added
On December 2, 2024, we and Intas entered into the UDENYCA Purchase Agreement, pursuant to which, and upon the terms and subject to the conditions thereof, we have agreed to divest the UDENYCA Business to Intas.
Removed
Our second product, YUSIMRY (adalimumab-aqvh), a biosimilar to Humira (adalimumab), was launched in the United States in July 2023.
Added
As consideration for the UDENYCA Sale, Intas has agreed to pay us $483.4 million in cash, inclusive of $118.4 million of UDENYCA product inventory, subject to downward adjustment by the amount of inventory delivered at the closing of the UDENYCA Sale less than the Inventory Target. Intas has designated Accord to purchase the physical assets, including product inventory.
Removed
Such consideration is subject to certain adjustments that will be finalized following the closing pursuant to the Purchase Agreement. O ur commercial portfolio includes LOQTORZI, a novel PD-1 inhibitor .
Added
In addition, the Company is also eligible to receive two Earnout Payments of $37.5 million each, provided that certain minimum UDENYCA Net Sales thresholds are met during specified periods after the closing of the UDENYCA Sale.
Removed
LOQTORZI is an anti-PD-1 antibody that we developed in collaboration with Junshi Biosciences. We announced the launch of LOQTORZI in the U.S. on January 2, 2024. We also have a pipeline of earlier stage clinical and preclinical immuno-oncology programs. On September 8, 2023, we acquired Surface and took ownership of its assets, including its portfolio of product candidates.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA hypothetical 100 basis point increase in the interest rate on our variable rate debt could result in up to a $2.5 million increase in the annual interest expense as of December 31, 2023. In April 2020, we issued $230.0 million aggregate principal amount of 2026 Convertible Notes with a fixed interest rate of 1.5%.
Biggest changeWe currently do not hedge our variable interest rate debt. The interest rate during the first quarter of 2025 will be 12.33%. A hypothetical 100 basis point increase in the interest rate on our variable rate debt could result in up to a $0.4 million increase in the annual interest expense that we pay.
We do not enter into investments for trading or speculative purposes. Our financial instruments that are exposed to concentration of credit risk consist primarily of cash, cash equivalents, investments and accounts receivables. We attempt to minimize the risks related to cash, cash equivalents and investments by investing in a broad and diverse range of financial instruments.
Our financial instruments that are exposed to concentration of credit risk consist primarily of cash, cash equivalents, investments and accounts receivables. We attempt to minimize the risks related to cash, cash equivalents and investments by investing in a broad and diverse range of financial instruments.
We are also subject to credit risk from trade receivables related to product sales, and we monitor the credit worthiness of customers that are granted credit in the normal course of business. In general, there is no requirement for collateral from customers. We have not experienced significant losses with respect to the collection of trade receivables.
We are not exposed to any significant concentrations of credit risk from these financial instruments. We are also subject to credit risk from trade receivables related to product sales, and we monitor the credit worthiness of customers that are granted credit in the normal course of business. In general, there is no requirement for collateral from customers.
The investment portfolio is maintained in accordance with our investment policy, which defines allowable investments, specifies credit quality standards and limits the credit exposure of any single issuer. There were no material losses from credit risks on such accounts during any of the periods presented. We are not exposed to any significant concentrations of credit risk from these financial instruments.
The investment portfolio is maintained in accordance with our investment policy, which defines allowable investments, specifies credit quality standards and limits the credit exposure of any single issuer. There were no material losses 88 Table of Contents from credit risks on such accounts during any of the periods presented.
Due to the short-term duration of our investment portfolio and the low risk profile of our investments, we believe that our exposure to interest rate risk on these investments is not significant and a 1% movement in market interest rates would not have a material impact to our financial results.
Due to the short-term duration of our cash and cash equivalents, we believe that our exposure to interest rate risk is not significant and a 1% movement in market interest rates would not have a material impact to our financial results. We do not enter into investments for trading or speculative purposes.
Since the notes have a fixed annual interest rate, we have no financial or economic interest exposure associated with changes in interest rates. However, the fair value of fixed rate debt fluctuates when interest rates change. Additionally, the fair value of the 2026 Convertible Notes can be impacted when the market price of our common stock fluctuates.
In April 2020, we issued $230.0 million aggregate principal amount of 2026 Convertible Notes with a fixed interest rate of 1.5%. Since the notes have a fixed annual interest rate, we have no financial or economic interest exposure associated with changes in interest rates for these notes. However, the fair value of fixed rate debt fluctuates when interest rates change.
We are exposed to interest rate risk with respect to variable rate debt. As of December 31, 2023, we had $250.0 million principal outstanding on our 2027 Term Loans that starting April 1, 2023, accrue interest at 8.25% plus the Adjusted Term SOFR, with a floor on Adjusted Term SOFR of 1.0%.
We have not experienced significant losses with respect to the collection of trade receivables. We are exposed to interest rate risk with respect to variable rate debt. As of December 31, 2024, we had $38.7 million principal outstanding on our 2029 Term Loan that accrues interest at 8.0% per annum, plus the three-month SOFR, with a floor of 1.0%.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk We are exposed to market risk related to changes in interest rates. As of December 31, 2023, we had cash and cash equivalents and marketable securities of $117.7 million, primarily invested in U.S. treasuries and government agency securities, commercial paper, corporate bonds and money market funds.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk We are exposed to market risk related to changes in interest rates. As of December 31, 2024, we had cash and cash equivalents of $126.0 million. Our primary exposure to market risk is interest rate sensitivity.
We carry the 2026 Convertible Notes on our balance sheet at face value less the unamortized discount and issuance costs, and we present the fair value for required disclosure purposes only. Substantially all of our sales are denominated in U.S. dollars. We had exposure to the exchange rate between the U.S.
Additionally, the fair value of the 2026 Convertible Notes can be impacted when the market price of our common stock fluctuates. We carry the 2026 Convertible Notes on our balance sheets at face value less the unamortized discount and issuance costs, and we present the fair value for required disclosure purposes only.
Removed
Our primary exposure to market risk is interest rate sensitivity. Our marketable securities are subject to interest rate risk and could fall in value if market interest rates increase.
Added
We plan to use a portion of the proceeds of the UDENYCA Sale to fully repay the entirety of the 2026 Convertible Notes. Substantially all of our sales are denominated in U.S. dollars, and since the CIMERLI Sale, we do not have any material exposure to the exchange rate between the U.S.
Removed
We currently do not hedge our variable interest rate debt. The interest rate for our variable rate debt during the quarter ended December 31, 2023 was 13.91%, and the interest rate during the first quarter of 2024 will be 13.84%.
Added
Dollar and the Euro. ​ ​ 89 Table of Contents
Removed
Dollar and the Euro because we made purchases of CIMERLI inventory from and paid royalties to our partner Bioeq that were denominated in Euros, and we were therefore subject to fluctuations due to changes in foreign currency exchange rates. Accordingly, fluctuations in the exchange rate between the U.S. Dollar and the Euro may have impacted our consolidated statements of operations.
Removed
In the first quarter of 2023, we started utilizing euro currency contracts to manage euro currency risk in purchasing inventory and future settlement of euro denominated assets and liabilities. The volume of our foreign currency contract activity is limited by the amount of transaction exposure in each foreign currency and our election whether to hedge the transactions.
Removed
There are no derivative instruments entered into for speculative or trading purposes. Since our derivatives all matured and settled by December 31, 2023, there were no derivative assets or derivative liabilities as of December 31, 2023. ​ ​ 90 Table of Contents

Other CHRS 10-K year-over-year comparisons