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

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Paragraph-level year-over-year comparison of Fulcrum Therapeutics, Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+466 added−522 removedSource: 10-K (2024-02-27) vs 10-K (2023-03-09)

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

466 paragraphs added · 522 removed · 373 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

190 edited+53 added−118 removed331 unchanged
Biggest changeRestrictions under applicable federal and state health care laws and regulations, include the following: • the federal Anti-Kickback Statute, which prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, paying, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made, in whole or in part, under a federal health care program such as Medicare and Medicaid; • the federal civil and criminal false claims laws, including the civil False Claims Act, and civil monetary penalties laws, which prohibit individuals or entities from, among other things, knowingly presenting, or causing to be presented, to the federal government, claims for payment that are false, fictitious or fraudulent or knowingly making, using or causing to made or used a false record or statement to avoid, decrease or conceal an obligation to pay money to the federal government; • the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created additional federal criminal laws that prohibit, among other things, knowingly and willfully executing, or attempting to 37 execute, a scheme to defraud any health care benefit program or making false statements relating to health care matters; • HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act, and their respective implementing regulations, including the Final Omnibus Rule published in January 2013, which impose obligations, including mandatory contractual terms, with respect to safeguarding the privacy, security and transmission of individually identifiable health information; • the federal false statements statute, which prohibits knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement in connection with the delivery of or payment for health care benefits, items or services; • the Foreign Corrupt Practices Act, or FCPA, which prohibits companies and their intermediaries from making, or offering or promising to make improper payments to non-U.S. officials for the purpose of obtaining or retaining business or otherwise seeking favorable treatment; • the federal transparency requirements known as the federal Physician Payments Sunshine Act, under the Patient Protection and Affordable Care Act, as amended by the Health Care Education Reconciliation Act, or the ACA, which requires certain manufacturers of drugs, devices, biologics and medical supplies to report annually to the Centers for Medicare & Medicaid Services, or CMS, within the United States Department of Health and Human Services, information related to payments and other transfers of value made by that entity to physicians, certain other licensed healthcare practitioners and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members; • federal government price reporting laws, which require us to calculate and report complex pricing metrics in an accurate and timely manner to government programs; • federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; and • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to health care items or services that are reimbursed by non-government third-party payors, including private insurers.
Biggest changeIn addition, there may be additional federal, state and non-U.S. laws which govern the privacy and security of health and other personal information in certain circumstances, many of which differ from each other in significant ways and may not have the same effect, thus complicating compliance efforts; • the federal false statements statute, which prohibits knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement in connection with the delivery of or payment for health care benefits, items or services; • the Foreign Corrupt Practices Act, or FCPA, which prohibits companies and their intermediaries from making, or offering or promising to make improper payments to non-U.S. officials for the purpose of obtaining or retaining business or otherwise seeking favorable treatment; • the federal transparency requirements known as the federal Physician Payments Sunshine Act, under the Patient Protection and Affordable Care Act, as amended by the Health Care Education Reconciliation Act, or the ACA, which requires certain manufacturers of drugs, devices, biologics and medical supplies to report annually to the Centers for Medicare & Medicaid Services, or CMS, within the United States Department of Health and Human Services, information related to payments and other transfers of value made by that entity to physicians, certain other licensed healthcare practitioners and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members; • federal government price reporting laws, which require us to calculate and report complex pricing metrics in an accurate and timely manner to government programs; • federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that potentially harm consumers; and • analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, which may apply to health care items or services that are reimbursed by non-government third-party payors, including private insurers.
We have retained all rights to our lead product candidates focused on rare genetically defined diseases, and plan to commercialize any approved product for such rare genetically defined diseases using a targeted sales infrastructure.
We have retained all rights to our lead product candidates focused on rare genetically defined diseases, and we plan to commercialize any approved product for such rare genetically defined diseases using a targeted sales infrastructure.
We believe that there may be additional patients who are not formally diagnosed due to a perceived difficulty of obtaining a diagnosis and the fact that there are no approved treatments. Approximately two-thirds of cases are familial-inherited in an autosomal dominant fashion and one-third of cases are sporadic. FSHD affects all ethnic groups with similar incidence and prevalence.
We believe that there may be additional patients who are not formally diagnosed due to a perceived difficulty of obtaining a diagnosis and the fact that there are no approved treatments. Approximately two-thirds of FSHD cases are familial-inherited in an autosomal dominant fashion and one-third of cases are sporadic. FSHD affects all ethnic groups with similar incidence and prevalence.
The original design of ReDUX4 included a muscle biopsy at week 16 during the 24-week treatment period followed by an open label extension. Sixteen of the 80 subjects in trial completed the 24-week treatment period and rolled over to the open label extension portion of the trial.
The original design of ReDUX4 included a muscle biopsy at week 16 during the 24-week treatment period followed by an open label extension. Sixteen of the 80 subjects in the trial completed the 24-week treatment period and rolled over to the open label extension portion of the trial.
These sickle shaped cells are much less flexible than healthy cells and can block blood vessels (vaso-occlusion) or rupture cells (lysis), leading to pain, anemia, irreversible organ damage or even death. During fetal development, the major form of hemoglobin is HbF. Similar to hemoglobin in adults, HbF is also a complex of four proteins, two α-subunits and two γ-subunits.
These sickle shaped cells are much less flexible than healthy cells and can block blood vessels (vaso-occlusion) or rupture (lysis), leading to pain, anemia, irreversible organ damage or even death. During fetal development, the major form of hemoglobin is HbF. Similar to hemoglobin in adults, HbF is also a complex of four proteins, two α-subunits and two γ-subunits.
Losmapimod With respect to losmapimod, we own one U.S. patent covering the method of use of losmapimod for the treatment of patients with FSHD and two U.S. patent covering the use of other clinical-stage p38 inhibitors for the treatment of patients with FSHD, each of which are expected to expire in 2038, and related patents and pending patent applications in Canada and Mexico, Europe, Africa, Australia and New Zealand, South America, and Asia with expiration dates in 2038.
Losmapimod With respect to losmapimod, we own one U.S. patent covering the method of use of losmapimod for the treatment of patients with FSHD and two U.S. patents covering the use of other clinical-stage p38 inhibitors for the treatment of patients with FSHD, each of which are expected to expire in 2038, and related patents and pending patent applications in Canada and Mexico, Europe, Africa, Australia and New Zealand, South America, and Asia with expiration dates in 2038.
Consequently, marketing authorization under exceptional circumstances may be granted subject to certain specific obligations, which may include the following: • the applicant must complete an identified program of studies within a time period specified by the competent authority, the results of which form the basis of a reassessment of the benefit/risk profile; • the medicinal product in question may be supplied on medical prescription only and may in certain cases be administered only under strict medical supervision, possibly in a hospital and in the case of a radiopharmaceutical, by an authorized person; and • the package leaflet and any medical information must draw the attention of the medical practitioner to the fact that the particulars available concerning the medicinal product in question are as yet inadequate in certain specified respects.
Consequently, a marketing authorization under exceptional circumstances may be granted subject to certain specific obligations, which may include the following: • the applicant must complete an identified program of studies within a time period specified by the competent authority, the results of which form the basis of a reassessment of the benefit/risk profile; • the medicinal product in question may be supplied on medical prescription only and may in certain cases be administered only under strict medical supervision, possibly in a hospital and in the case of a radiopharmaceutical, by an authorized person; and • the package leaflet and any medical information must draw the attention of the medical practitioner to the fact that the particulars available concerning the medicinal product in question are as yet inadequate in certain specified respects.
Data and Market Exclusivity In the EU, innovative medicinal products approved on the basis of a complete independent data package qualify for eight years of data exclusivity upon marketing authorization and an additional two years of market exclusivity pursuant to Directive 2001/83/EC. Regulation (EC) No 726/2004 repeats this entitlement for medicinal products authorized in accordance the centralized authorization procedure.
Data and Market Exclusivity In the EU, innovative medicinal products approved on the basis of a complete and independent data package qualify for eight years of data exclusivity upon marketing authorization and an additional two years of market exclusivity pursuant to Directive 2001/83/EC. Regulation (EC) No 726/2004 repeats this entitlement for medicinal products authorized in accordance the centralized authorization procedure.
Even if a product is considered to be an innovative medicinal product so that the innovator gains the prescribed period of data exclusivity, another company nevertheless could also market another version of the product if such company obtained marketing authorization based on an MAA with a complete independent data package of pharmaceutical tests, preclinical tests and clinical trials.
Even if a product is considered to be an innovative medicinal product so that the innovator gains the prescribed period of data exclusivity, another company nevertheless could also market another version of the product if such company obtained marketing authorization based on an MAA with a complete and independent data package of pharmaceutical tests, preclinical tests and clinical trials.
However, marketing authorization may be granted to a similar medicinal product with the same orphan indication during the ten-year period with the consent of the marketing authorization holder for the original orphan medicinal product or if the manufacturer of the original orphan medicinal product is unable to supply sufficient quantities.
However, a marketing authorization may be granted to a similar medicinal product with the same orphan indication during the ten-year period with the consent of the marketing authorization holder for the original orphan medicinal product or if the manufacturer of the original orphan medicinal product is unable to supply sufficient quantities.
Among the provisions of the ACA of importance to our potential product candidates are: • an annual, nondeductible fee on any entity that manufactures or imports specified branded prescription drugs and biologic agents, apportioned among these entities according to their market share in certain government healthcare programs; • expansion of eligibility criteria for Medicaid programs, thereby potentially increasing a manufacturer’s Medicaid rebate liability; • expanded manufacturers’ rebate liability under the Medicaid Drug Rebate Program; • expanded the types of entities eligible for the 340B drug discount program; • established the Medicare Part D coverage gap discount program by requiring manufacturers to provide a 70% point-of-sale-discount off the negotiated price of applicable brand drugs to eligible beneficiaries during their coverage gap period as a condition for the manufacturers’ outpatient drugs to be covered under Medicare Part D; and • a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.
Among the provisions of the ACA of importance to our potential product candidates are: • an annual, nondeductible fee on any entity that manufactures or imports specified branded prescription drugs and biologic agents, apportioned among these entities according to their market share in certain government healthcare programs; • expansion of eligibility criteria for Medicaid programs, thereby potentially increasing a manufacturer’s Medicaid rebate liability; • expanded manufacturers’ rebate liability under the Medicaid Drug Rebate Program; • expanded the types of entities eligible for the 340B drug discount program; • established the Medicare Part D coverage gap discount program by requiring manufacturers to provide a 70% point-of-sale-discount off the negotiated price of applicable brand drugs to eligible beneficiaries during their coverage gap period as a condition for the manufacturers’ outpatient drugs to be covered under Medicare Part D; and • a Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research.
Regulation (EC) No. 141/2000, as implemented by Regulation (EC) No. 847/2000 provides that a drug can be designated as an orphan drug by the European Commission if its sponsor can establish: (1) that the product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition; (2) either (a) such condition affects no more than five (5) in ten thousand (10,000) persons in the EU when the application is made, or (b) it is unlikely that the product, without the benefits derived from orphan status, would generate sufficient return in the EU to justify the necessary investment in its development; and (3)there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU or, if such method exists, the product will be of significant benefit to those affected by that condition.
Regulation (EC) No. 141/2000, as implemented by Regulation (EC) No. 847/2000 provides that a product can be designated as an orphan product by the European Commission if its sponsor can establish: (1) that the product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition; (2) either (a) such condition affects no more than five (5) in ten thousand (10,000) persons in the EU when the application is made, or (b) it is unlikely that the product, without the benefits derived from orphan status, would generate sufficient return in the EU to justify the necessary investment in its development; and (3)there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU or, if such method exists, the product will be of significant benefit to those affected by that condition.
Under the statute, a generic drug is bioequivalent to a RLD if “the rate and extent of absorption of the drug do not show a significant difference from the rate and extent of absorption of the listed drug.” Upon approval of an ANDA, the FDA indicates whether the 35 generic product is “therapeutically equivalent” to the RLD in its publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” also referred to as the “Orange Book.” Depending on state laws, generic drugs that are found to be therapeutically equivalent may be automatically substituted for prescriptions for the RLD by the dispensing pharmacist, without the intervention of the prescriber.
Under the statute, a generic drug is bioequivalent to a RLD if “the rate and extent of absorption of the drug do not show a significant difference from the rate and extent of absorption of the listed drug.” Upon approval of an ANDA, the FDA indicates whether the generic product is “therapeutically equivalent” to the RLD in its publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” also referred to as the “Orange Book.” Depending on state laws, generic drugs that are found to be therapeutically equivalent may be automatically substituted for prescriptions for the RLD by the dispensing pharmacist, without the intervention of the prescriber.
Other potential consequences may include: • restrictions on the marketing or manufacturing of the product, complete withdrawal of the product from the market or product recalls; • fines, warning letters or holds on post-approval clinical trials; 34 • refusal of the FDA to approve pending applications or supplements to approved applications, or suspension or revocation of product license approvals; • product seizure or detention, or refusal to permit the import or export of products; or • injunctions or the imposition of civil or criminal penalties.
Other potential consequences may include: • restrictions on the marketing or manufacturing of the product, complete withdrawal of the product from the market or product recalls; • fines, warning letters or holds on post-approval clinical trials; • refusal of the FDA to approve pending applications or supplements to approved applications, or suspension or revocation of product license approvals; • product seizure or detention, or refusal to permit the import or export of products; or • injunctions or the imposition of civil or criminal penalties.
To date, we have achieved a $2.5 million specified preclinical milestone. MyoKardia will also pay us tiered royalties ranging from a mid single-digit percentage to a low double-digit percentage based on MyoKardia’s, and any of its affiliates’ and sublicensees’, annual worldwide net sales of products under the agreement directed against any Identified 24 Target.
To date, we have achieved a $2.5 million specified preclinical milestone. MyoKardia will also pay us tiered royalties ranging from a mid single-digit percentage to a low double-digit percentage based on MyoKardia’s, and any of its affiliates’ and sublicensees’, annual worldwide net sales of products under the agreement directed against any Identified Target.
Further, under the IRA, orphan drugs are exempted from the Medicare drug price negotiation program, but only if they have one rare disease designation and for which the only approved indication is for that disease or condition. If a product receives multiple rare disease designations or has multiple approved indications, it may not qualify for the orphan drug exemption.
Further, under the IRA, orphan drugs are exempted from the Medicare drug price negotiation program, but only if they have one orphan designation and for which the only approved indication is for that disease or condition. If a product receives multiple orphan designations or has multiple approved indications, it may not qualify for the orphan drug exemption.
By screening our small molecule probe library and a CRISPR library, we identified several potential drug targets that activated the HBG1/2 genes and resulted in HbF elevation. Each screening approach identified the same protein complex which we believe plays an important role in the expression of genes responsible for the production of HbF.
By screening our small molecule probe library and a CRISPR library, we identified several potential drug targets that activated the HBG1/2 genes and resulted in HbF elevation. Each screening approach identified the same protein complex, PRC2, which we believe plays an important role in the expression of genes responsible for the production of HbF.
Additionally, researchers from Saint Louis University independently published the results of a study which concluded that inhibitors of p38α/ß, including losmapimod, suppressed DUX4 expression in cellular and animal FSHD models. Losmapimod Overview After identifying p38α/ß as a potential drug target, we evaluated multiple small molecule inhibitors of p38α/ß.
Additionally, researchers from Saint Louis University independently published the results of a study that concluded that inhibitors of p38α/ß, including losmapimod, suppressed DUX4 expression in cellular and animal FSHD models. Losmapimod Overview After identifying p38α/ß as a potential drug target, we evaluated multiple small molecule inhibitors of p38α/ß.
The applicant will receive a fee reduction for the MAA if the orphan drug designation has been granted, but not if the designation is still pending at the time the marketing authorization is submitted. Orphan drug designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.
The applicant will receive a fee reduction for the MAA if the orphan designation has been granted, but not if the designation is still pending at the time the marketing authorization is submitted. Orphan designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.
The FDA requires a 30-day waiting period after the filing of each IND before clinical trials may begin. This waiting period is designed to allow the FDA to review the IND to determine, among other things, whether human research subjects will be exposed to 29 unreasonable health risks.
The FDA requires a 30-day waiting period after the filing of each IND before clinical trials may begin. This waiting period is designed to allow the FDA to review the IND to determine, among other things, whether human research subjects will be exposed to unreasonable health risks.
The EU medicines rules expressly permit the EU Member States to adopt national legislation prohibiting o© restricting the sale, supply or use of any medicinal product containing, consisting of or derived from a specific type of human or animal cell, such as embryonic stem cells.
The EU medicines rules expressly permit the EU Member States to adopt national legislation prohibiting or restricting the sale, supply or use of any medicinal product containing, consisting of or derived from a specific type of human or animal cell, such as embryonic stem cells.
The study also found that the most notable declines in RWS were in above-the-shoulder level quadrants with no significant changes in lower quadrants and that RWS declined more significantly if the subjects wore 500-gram weights on their wrists. 12 The figure above illustrates RWS in four quadrants.
The study also found that the most notable declines in RWS were in above-the-shoulder level quadrants with no significant changes in lower quadrants and that RWS declined more significantly if the subjects wore 500-gram weights on their wrists. The figure above illustrates RWS in four quadrants.
SCD is reported to shorten life expectancy by approximately 20 to 30 years. People with SCD are primarily treated by hematologists. 14 In the United States, where newborn screening for SCD is mandatory, the estimated prevalence is approximately 100,000 individuals. In Europe, the estimated prevalence is approximately 50,000 individuals.
SCD is reported to shorten life expectancy by approximately 20 to 30 years. People with SCD are primarily treated by hematologists. In the United States, where newborn screening for SCD is mandatory, the estimated prevalence is approximately 100,000 individuals. In Europe, the estimated prevalence is approximately 50,000 individuals.
Novo Nordisk A/S, or Novo, is evaluating nDec (decitabine-tetrahydrouridine), a small molecule designed to increase production of HbF, in a Phase 2 clinical trial that began enrolling in the summer of 2022. Novo is also evaluating etavopivat, 27 a PKR agonist, in a Phase 2/3 clinical trial.
Novo Nordisk A/S, or Novo, is evaluating nDec (decitabine-tetrahydrouridine), a small molecule designed to increase production of HbF, in a Phase 2 clinical trial that began enrolling in the summer of 2022. Novo is also evaluating etavopivat, a PKR agonist, in a Phase 2/3 clinical trial.
Following issuance of a clinical hold or partial clinical hold, a clinical trial may only resume after the FDA has so notified the sponsor. The FDA will base that determination on information provided by the sponsor correcting the deficiencies previously cited or otherwise satisfying the FDA that the clinical trial can proceed.
Following issuance of a clinical hold or partial clinical hold, a clinical trial may only resume after the FDA has notified the sponsor. The FDA will base that determination on information provided by the sponsor correcting the deficiencies previously cited or otherwise satisfying the FDA that the clinical trial can proceed.
If an applicant obtains a marketing authorization in all EU Member States, or a marketing authorization granted in the centralized procedure by the European Commission, and the study results for the peopulationopulation are included in the product information, even when negative, the medicine is then eligible for an additional six-month period of qualifying patent protection through extension of the term of the Supplementary Protection Certificate or SPC, provided an application for such extension is made at the same time as filing the SPC application for the product, or at any point up to two years before the SPC expires, even where the trial results are negative.
If an applicant obtains a marketing authorization in all EU Member States, or a marketing authorization granted in the centralized procedure by the European Commission, and the study results for the population are included in the product information, even when negative, the medicine is then eligible for an additional six-month period of qualifying patent protection through extension of the term of the Supplementary Protection Certificate or SPC, provided an application for such extension is made at the same time as filing the SPC application for the product, or at any point up to two years before the SPC expires, even where the trial results are negative.
At present, Great Britain has implemented EU legislation on the marketing, promotion and sale of medicinal products through the Human Medicines Regulations 2012 (as amended) (under the Northern Ireland Protocol, the EU regulatory framework continues to apply in Northern Ireland).
At present, Great Britain has implemented EU legislation on the marketing, promotion and sale of medicinal products through the Human Medicines Regulations 2012 (as amended) (under the Northern Ireland Protocol, the EU regulatory framework currently continues to apply in Northern Ireland).
Among the total of 14 Phase 1 and Phase2 placebo-controlled clinical trials of losmapimod (N=1327 on losmapimod; N=735 on placebo), the distribution of SAEs was similar among losmapimod-treated and placebo-treated subjects. The most common SAEs were cardiac disorders (2% placebo; 3% losmapimod) and respiratory, thoracic and mediastinal disorders (1% placebo; 2% losmapimod).
Among the total of 14 Phase 1 and Phase 2 placebo-controlled clinical trials of losmapimod (N=1327 on losmapimod; N=735 on placebo), the distribution of SAEs was similar among losmapimod-treated and placebo-treated subjects. The most common SAEs were cardiac disorders (2% placebo; 3% losmapimod) and respiratory, thoracic and mediastinal disorders (1% placebo; 2% losmapimod).
The new Clinical Trials Regulation aims to simplify and streamline the approval of clinical trials in the EU. Under the new coordinated procedure for the approval of clinical trials, the sponsor of a clinical trial is required to submit a single application for approval of a clinical 40 trial to a reporting EU Member State through an EU Portal.
The new Clinical Trials Regulation aims to simplify and streamline the approval of clinical trials in the EU. Under the new coordinated procedure for the approval of clinical trials, the sponsor of a clinical trial is required to submit a single application for approval of a clinical trial to a reporting EU Member State through an EU Portal.
Importantly, a dedicated EMA contact and rapporteur from the Committee for Human Medicinal Products, or CHMP, or Committee for Advanced Therapies, are appointed early in the PRIME scheme facilitating increased understanding of the product at EMA’s Committee level.
Importantly, a dedicated EMA contact and rapporteur from the Committee for Medicinal Products for Human Use, or CHMP, or Committee for Advanced Therapies, are appointed early in the PRIME scheme facilitating increased understanding of the product at the EMA’s Committee level.
The primary endpoints are to assess safety and tolerability over the 52-week period. The secondary endpoints are the change 11 from baseline in pHSP27 and the ratio of pHSP27 to total HSP27 in blood and muscle for assessment of the inhibition of p38α/ß during the dosing period.
The primary endpoints are to assess safety and tolerability over the 52-week period. The secondary endpoints are the change from baseline in pHSP27 and the ratio of pHSP27 to total HSP27 in blood and muscle for assessment of the inhibition of p38α/ß during the dosing period.
The 44 GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR.
The GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR.
The American Taxpayer Relief Act of 2012 further reduced Medicare payments to 39 several types of providers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.
The American Taxpayer Relief Act of 2012 further reduced Medicare payments to several types of providers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.
A “similar medicinal product” is defined as a medicinal product containing a similar active substance or substances as contained in an authorized orphan medicinal product, and which is 43 intended for the same therapeutic indication.
A “similar medicinal product” is defined as a medicinal product containing a similar active substance or substances as contained in an authorized orphan medicinal product, and which is intended for the same therapeutic indication.
Orphan Drug Designation and Exclusivity Products receiving orphan designation in the EU can receive ten years of market exclusivity, during which time no “similar medicinal product” may be placed on the market.
Orphan Designation and Exclusivity Products receiving orphan designation in the EU can receive ten years of market exclusivity, during which time no “similar medicinal product” may be placed on the market.
Orphan medicinal products are eligible for financial incentives such as reduction of fees or fee waivers. The application for orphan drug designation must be submitted before the application for marketing authorization.
Orphan medicinal products are eligible for financial incentives such as reduction of fees or fee waivers. The application for orphan designation must be submitted before the application for marketing authorization.
However, HSCT is more commonly offered to pediatric individuals with an available HLA-matched sibling donor. The 5-year survival rates in this young SCD population is quite high but for older individuals (>16 years), the survival rates can be considerably lower. There are also significant risks associated with HSCT including infertility and graft-versus-host disease.
However, allo-HSCT is more commonly offered to pediatric individuals with an available HLA-matched sibling donor. The 5-year survival rates in this young population is quite high but for older individuals (>16 years), the survival rates can be considerably lower. There are also significant risks associated with allo-HSCT including infertility and graft-versus-host disease.
Other legislative changes have been proposed and adopted in the United States since the ACA was enacted. The Budget Control Act of 2011, among other things, created measures for spending reductions by Congress. This includes aggregate reductions of Medicare payments to providers up to 2% per fiscal year. Subsequent legislation extended the 2% which remains in effect through 2030.
Other legislative changes have been proposed and adopted in the United States since the ACA was enacted. The Budget Control Act of 2011, among other things, created measures for spending reductions by Congress. This includes aggregate reductions of Medicare payments to providers up to 2% per fiscal year. Subsequent legislation extended the 2% which remains in effect through 2031.
The 42 holder of a national marketing authorization may submit an application to the competent authority of an EU Member State requesting that this authority recognize the marketing authorization delivered by the competent authority of another EU Member State.
The holder of a national marketing authorization may submit an application to the competent authority of an EU Member State requesting that this authority recognize the marketing authorization delivered by the competent authority of another EU Member State.
Paediatric Studies and Exclusivity Prior to obtaining a marketing authorization in the EU, applicants must demonstrate compliance with all measures included in an EMA-approved PIP covering all subsets of the pediatric population, unless the EMA has granted a product-specific waiver, a class waiver, or a deferral for one or more of the measures included in the PIP.
Paediatric Studies and Exclusivity Prior to obtaining a marketing authorization in the EU, applicants must demonstrate compliance with all measures included in an EMA-approved pediatric investigation plan, or PIP, covering all subsets of the pediatric population, unless the EMA has granted a product-specific waiver, a class waiver, or a deferral for one or more of the measures included in the PIP.
Clinical Trial: Phase 2 Open Label Study Trial In parallel with the ReDUX4 Phase 2b clinical trial, we also initiated in August 2019 an open label, single center Phase 2 clinical trial of losmapimod in up to 16 patients with FSHD and clinical severity scores of two to four on the Ricci scale.
Clinical Trial: Phase 2 Open Label Study Trial In parallel with the ReDUX4 Phase 2b clinical trial, we also initiated an open label, single center Phase 2 clinical trial of losmapimod in up to 16 patients with FSHD and clinical severity scores of two to four on the Ricci scale.
Additionally, some state and local laws require the registration of pharmaceutical sales representatives in the jurisdiction. State laws also govern the privacy and security of personal information, including health information. Many state laws differ from each other in significant ways, thus complicating compliance efforts.
Additionally, some state and local laws require the registration of pharmaceutical sales representatives in the jurisdiction. State laws also govern the privacy and security of personal information, including health information. Many state laws differ from each other in various ways, thus complicating compliance efforts.
We measure potential losmapimod treatment effects on shoulder and upper arm function and mobility/ambulation, as well as on muscle strength and function and quality of life and activities of daily living, similar to the assessments in the Phase 2b clinical trial.
We measured potential losmapimod treatment effects on shoulder and upper arm function and mobility/ambulation, as well as on muscle strength and function and quality of life and activities of daily living, similar to the assessments in the Phase 2b clinical trial.
FTX-6058 showed a significant elevation of HbF over baseline in each of these 14 donor cell lines. We have conducted additional preclinical profiling in CD34+ derived cells and observed that treatment with FTX-6058 increased HbF levels to approximately 30% of total hemoglobin, as measured by mass spectrometry, high performance liquid chromatography, and fast protein liquid chromatography techniques.
Pociredir showed a significant elevation of HbF over baseline in each of these 14 donor cell lines. We have conducted additional preclinical profiling in CD34+ derived cells and observed that treatment with pociredir increased HbF levels to approximately 30% of total hemoglobin, as measured by mass spectrometry, high performance liquid chromatography, and fast protein liquid chromatography techniques.
In the losmapimod group, the SAEs of fatatity were infections and infestations (four), general disorders and administrative site conditions (three), respiratory, thoracic and mediastinal disorders (two), cardiac disorder (one), injury poisoning and procedural complications (one), gastrointestinal disorder (one) and neoplasm (one).
In the losmapimod group, the SAEs of fatality were infections and infestations (four), general disorders and administrative site conditions (three), respiratory, thoracic and mediastinal disorders (two), cardiac disorder (one), injury poisoning and procedural complications (one), gastrointestinal disorder (one) and neoplasm (one).
Special pricing and reimbursement rules may apply to orphan drugs. Inclusion of orphan drugs in reimbursement systems tend to focus on the medical usefulness, need, quality and economic benefits to patients and the healthcare system as for any drug.
Special pricing and reimbursement rules may apply to orphan products. Inclusion of orphan products in reimbursement systems tend to focus on the medical usefulness, need, quality and economic benefits to patients and the healthcare system as for any drug.
Until being placed on clinical hold, the Phase 1b trial was evaluating subjects both on and off hydroxyurea. Phase 1b data from subjects in the 6 mg dose cohort (n=10) showed up to 9.5% absolute HbF increases from baseline. These data suggested no difference in response in subjects on (n=3) and off (n=7) background hydroxyurea.
Until being placed on clinical hold in February 2023, the Phase 1b trial was evaluating subjects both on and off background hydroxyurea therapy. Phase 1b data from subjects in the 6 mg dose cohort (n=10) showed up to 9.5% absolute HbF increases from baseline. These data suggested no difference in response in subjects on (n=3) and off (n=7) background hydroxyurea.
As part of our FTX-6058 development program, we have conducted numerous non-clinical toxicology studies, including studies conducted under good laboratory practice, or GLP. These toxicology studies have included repeat-dose maximum tolerated dose and dose range finding studies; 28-day, 13-week, 17-week, and 26-week studies in rats; and 28-day, 13-week, and 39-week studies in dogs.
As part of our pociredir development program, we have conducted numerous non-clinical toxicology studies, including studies conducted under good laboratory practice, or GLP. These toxicology studies have included repeat-dose maximum tolerated dose and dose range finding studies; 28-day, 13-week, 17-week, and 26-week studies in rats; and 28-day, 13-week, and 39-week studies in dogs.
In October 2022, we presented data through 96 weeks from the open label extension portion of ReDUX4, which showed that patients in the initial treatment-arm who continued to receive losmapimod experienced maintenance of effect through 96 weeks as measured by RWS mean change from baseline.
In October 2022, we presented data through 96 weeks from the open label extension portion of ReDUX4, which showed that patients in the initial treatment-arm who continued to receive losmapimod experienced maintenance of effect through 96 weeks as measured by reachable workspace, or RWS, mean change from baseline.
These rules can impose post-authorization studies and additional monitoring obligations. • The manufacturing of authorized medicinal products, for which a separate manufacturer’s license is mandatory, must also be conducted in strict compliance with the applicable EU laws, regulations and guidance, including Directive 2001/83/EC, Directive 2003/94/EC, Regulation (EC) No 726/2004 and the European Commission Guidelines for Good Manufacturing Practice.
These rules can impose post-authorization studies and additional monitoring obligations. • The manufacturing of authorized medicinal products, for which a separate manufacturer’s license is mandatory, must also be conducted in strict compliance with the applicable EU laws, regulations and guidance, including Directive 2001/83/EC, Directive (EU) 2017/1572, Regulation (EC) No 726/2004 and the European Commission Guidelines for Good Manufacturing Practice.
One drug target that we identified from our screening efforts for which we did not observe adverse cell health issues was p38α/ß, which had been studied extensively in other diseases, but had not been reported to be linked to DUX4 expression or FSHD until we conducted our screening efforts.
However, one drug target that we identified from our screening efforts for which we did not observe adverse cell health consequences was p38α/ß, which had been studied extensively in other diseases but had not been reported to be linked to DUX4 expression or FSHD until we conducted our screening efforts.
We observed that hydroxyurea had a minimal impact on HbF elevation, whereas we observed that FTX-6058 significantly elevated HbF. In cells treated with the combination of FTX-6058 and hydroxyurea, we observed an increased effect relative to either compound alone. Additionally, we studied FTX-6058 in a mouse model of SCD, known as the Townes mouse model.
We observed that hydroxyurea had a minimal impact on HbF elevation, whereas we observed that pociredir significantly elevated HbF. In cells treated with the combination of pociredir and hydroxyurea, we observed an increased effect relative to either compound alone. Additionally, we studied pociredir in a mouse model of SCD, known as the Townes mouse model.
As shown in the figures below, we observed that FTX-6058 resulted in a significant increase in HbF-expressing cells, or F-cells, and HbF protein levels after 13 days of dosing at 5 mg/kg once per day whereas hydroxyurea resulted in modest increases in F-cells and HbF.
As shown in the figures below, we observed that pociredir resulted in a significant increase in HbF-expressing cells, or F-cells, and HbF protein levels after 13 days of dosing at 5 mg/kg once per day whereas hydroxyurea resulted in modest increases in F-cells and HbF.
In these studies, we used a conventional method of assessing statistical significance known as a one-way analysis of variance, or ANOVA. The p-value for FTX-6058 was less than 0.001 for both studies and the p-value for hydroxyurea in the study depicted on the right was less than 0.01.
In these studies, we used a conventional method of assessing statistical significance known as a one-way analysis of variance, or ANOVA. The p-value for pociredir was less than 0.001 for both studies and the p-value for hydroxyurea in the study depicted on the right was less than 0.01.
As a result of our evaluation and relative to other p38α/ß inhibitors, we identified losmapimod as the preferred development candidate based on substantial and attractive preclinical and clinical data regarding safety, PK and target 8 inhibition, and its advanced stage of development.
As a result of our evaluation and relative to other p38α/ß inhibitors, we identified losmapimod as the preferred development candidate based on substantial and attractive preclinical and clinical data regarding safety, pharmacokinetics, or PK, and target inhibition, and its advanced stage of development.
Percentage of F-cells in Townes mice treated with FTX-6058 HbF protein levels in Townes mice treated with FTX-6058 In the graphic on the left, we quantified the percentage of F-cells as a percentage of total cells (%F-cells) for the three treatment conditions from mouse blood, shown as a percentage of vehicle-alone-treated SCD mice.
Percentage of F-cells in Townes mice treated with pociredir HbF protein levels in Townes mice treated with pociredir In the graphic on the left, we quantified the percentage of F-cells as a percentage of total cells (%F-cells) for the three treatment conditions from mouse blood, shown as a percentage of vehicle-alone-treated SCD mice.
Given the breadth of opportunities for our proprietary product engine to discover drug targets and develop product candidates for genetically defined diseases, we may enter into strategic partnerships for certain drug targets, product candidates or disease areas, such as our collaboration and license agreement with MyoKardia, a wholly-owned subsidiary of Bristol Myers Squibb.
Given the breadth of opportunities for our discovery approach to discover drug targets and develop product candidates for genetically defined diseases, we may enter into strategic partnerships for certain drug targets, product candidates or disease areas, such as our collaboration and license agreement with MyoKardia, a wholly-owned subsidiary of Bristol Myers Squibb.
FulcrumSeek Identified the Drug Target for FSHD We utilized patient-derived FSHD1 muscle cells, known as myotubes, and screened them with our small molecule probe library to identify drug targets that reduced DUX4 expression. We identified several potential drug targets, however the modulation of the majority of the targets adversely affected the health or differentiation of muscle cells.
Identification of the Drug Target for FSHD We utilized patient-derived FSHD1 muscle cells, known as myotubes, and screened them with our small molecule probe library to identify drug targets that reduced DUX4 expression. While we identified several potential drug targets, the modulation of the majority of the targets adversely affected the health or differentiation of muscle cells.
Clinical Trial: Phase 1 Healthy Volunteers In the fourth quarter of 2020, we initiated a Phase 1 clinical trial of FTX-6058 in healthy adult volunteers. The Phase 1 randomized, double-blind, placebo-controlled trial was designed to evaluate the safety, tolerability, and PK of ascending doses of FTX-6058.
Clinical Trial: Phase 1 Healthy Volunteers In the fourth quarter of 2020, we initiated a Phase 1 clinical trial of pociredir in healthy adult volunteers. The Phase 1 randomized, double-blind, placebo-controlled trial was designed to evaluate the safety, tolerability, and PK of ascending doses of pociredir.
The failure of an applicant to comply with the applicable regulatory requirements at any time during the product development process, including non-clinical testing, clinical testing, the approval process or post-approval process, may result in delays to the conduct of a study, regulatory review and approval and/or administrative or judicial sanctions. 28 An applicant seeking approval to market and distribute a new drug in the United States generally must satisfactorily complete each of the following steps before the product candidate will be approved by the FDA: • preclinical testing including laboratory tests, animal studies and formulation studies, which must be performed in accordance with the FDA’s GLP regulations and standards; • submission to the FDA of an IND for human clinical testing, which must become effective before human clinical trials may begin; • approval by an independent institutional review board, or IRB, representing each clinical site before each clinical trial may be initiated; • performance of adequate and well-controlled human clinical trials to establish the safety, potency and purity of the product candidate for each proposed indication, in accordance with current good clinical practices, or GCP; • preparation and submission to the FDA of a new drug application, or NDA, for a drug product which includes not only the results of the clinical trials, but also, detailed information on the chemistry, manufacture and quality controls for the product candidate and proposed labelling for one or more proposed indication(s); • review of the product candidate by an FDA advisory committee, where appropriate or if applicable; • satisfactory completion of an FDA inspection of the manufacturing facility or facilities, including those of third parties, at which the product candidate or components thereof are manufactured to assess compliance with current good manufacturing practices, or cGMP, requirements and to assure that the facilities, methods and controls are adequate to preserve the product’s identity, strength, quality and purity; • satisfactory completion of any FDA audits of the non-clinical and clinical trial sites to assure compliance with GCP and the integrity of clinical data in support of the NDA; • payment of user fees and securing FDA approval of the NDA to allow marketing of the new drug product; and • compliance with any post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy, or REMS, and the potential requirement to conduct any post-approval studies required by the FDA.
An applicant seeking approval to market and distribute a new drug in the United States generally must satisfactorily complete each of the following steps before the product candidate will be approved by the FDA: • preclinical testing including laboratory tests, animal studies and formulation studies, which must be performed in accordance with the FDA’s GLP regulations and standards; • submission to the FDA of an IND for human clinical testing, which must become effective before human clinical trials may begin; • approval by an independent institutional review board, or IRB, representing each clinical site before each clinical trial may be initiated; • performance of adequate and well-controlled human clinical trials to establish the safety and effectiveness of the product candidate for each proposed indication, in accordance with current good clinical practices, or GCP; • preparation and submission to the FDA of a new drug application, or NDA, for a drug product which includes not only the results of the clinical trials, but also, detailed information on the chemistry, manufacture and quality controls for the product candidate and proposed labelling for one or more proposed indication(s); • review of the product candidate by an FDA advisory committee, where appropriate or if applicable; • satisfactory completion of an FDA inspection of the manufacturing facility or facilities, including those of third parties, at which the product candidate or components thereof are manufactured to assess compliance with current good manufacturing practices, or cGMP, requirements and to assure that the facilities, methods and controls are adequate to preserve the product’s identity, strength, quality and purity; • satisfactory completion of any FDA audits of the non-clinical and clinical trial sites to assure compliance with GCP and the integrity of clinical data in support of the NDA; • payment of user fees and securing FDA approval of the NDA to allow marketing of the new drug product; and • compliance with any post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy, or REMS, and the potential requirement to conduct any post-approval studies required by the FDA.
We expect to continue to rely on third parties for the manufacture of FTX-6058 for any future clinical trials and for the manufacture of any future product candidates for preclinical and clinical testing, as well as for commercial manufacture if our product candidates receive marketing approval.
We expect to continue to rely on third parties for the manufacture of pociredir for any future clinical trials and for the manufacture of any future product candidates for preclinical and clinical testing, as well as for commercial manufacture if our product candidates receive marketing approval.
PGIC, a measure of self-reported change in how a patient feels and functions, showed that participants were able to recognize improvements after 48 weeks of treatment. More participants in the losmapimod group reported improvement at 48 weeks compared to placebo. Four times more losmapimod participants reported improvement over time as compared to participants treated with placebo.
PGIC, a measure of self-reported change in how a patient feels and functions, shows whether participants were able to recognize improvements after 48 weeks of treatment. More participants in the losmapimod group reported improvement at 48 weeks compared to placebo. Four times more losmapimod participants reported improvement over time as compared to participants treated with placebo.
As of March 2, 2023, our employee records indicate that approximately 38% of our full-time U.S. employees identify as non-white.
As of March 2, 2023, our employee records indicate that approximately 29% of our full-time U.S. employees identify as non-white.
We may in the future pursue commercialization partnerships for certain product candidates and/or markets outside the United States. • Selectively enter into strategic partnerships to maximize the value of our product engine and pipeline.
We may in the future pursue commercialization partnerships for certain product candidates and/or markets outside the United States. • Selectively enter into strategic partnerships to maximize the value of our discovery approach and pipeline.
In connection with the clinical hold, the FDA noted that the profile of hematological malignancies observed in the toxicology studies of FTX-6058 is similar to that observed with other inhibitors of PRC2 and that hematological malignancies have been reported clinically with other inhibitors of PRC2.
In connection with the clinical hold, the FDA noted that the profile of hematological malignancies observed in the toxicology studies of pociredir is similar to that observed with other inhibitors of PRC2 and that hematological malignancies have been reported clinically with other inhibitors of PRC2.
Notably, based on a review of data from other mechanisms, HbF fold induction in CD34+ cells has translated reliably into the clinic. Effect of FTX-6058 treatment in differentiated primary human CD34+ cells 21 Additionally, we compared the effect of FTX-6058 in CD34+ derived cells relative to that of hydroxyurea.
Notably, based on a review of data from other mechanisms, HbF fold induction in CD34+ cells has translated reliably into the clinic. Effect of pociredir treatment in differentiated primary human CD34+ cells Additionally, we compared the effect of pociredir in CD34+ derived cells relative to that of hydroxyurea.
Intellectual Property We strive to protect and enhance the proprietary technology, inventions and improvements that are commercially important to the development of our business, including by seeking, maintaining and defending patent rights, whether developed internally or licensed from third parties.
Intellectual Property We strive to protect and enhance our discovery approach, inventions and improvements that are commercially important to the development of our business, including by seeking, maintaining and defending patent rights, whether developed internally or licensed from third parties.
GSK generally observed a similar frequency of serious adverse events, or SAEs, and deaths between patients given losmapimod and patients given placebo. These trials included extensive evaluation of the cardiovascular risk profile of losmapimod, including completion of an evaluation of the potential to prolong corrected QT.
GSK generally observed a similar frequency of SAEs and deaths between patients given losmapimod and patients given placebo. These trials included extensive evaluation of the cardiovascular risk profile of losmapimod, including completion of an evaluation of the potential to prolong corrected QT.
Item 1. Bu siness. Overview We are a clinical-stage biopharmaceutical company focused on improving the lives of patients with genetically defined rare diseases in areas of high unmet medical need. Our most advanced clinical product candidate, losmapimod, is being developed for the potential treatment of facioscapulohumeral muscular dystrophy, or FSHD.
Item 1. Bu siness. Overview We are a clinical-stage biopharmaceutical company focused on developing small molecules to improve the lives of patients with genetically defined rare diseases in areas of high unmet medical need. Our most advanced clinical-stage product candidate, losmapimod, is being developed for the potential treatment of facioscapulohumeral muscular dystrophy, or FSHD.
The clinical outcome assessments are RWS, FSHD-TUG, muscle strength, motor function ability and generic and FSHD-specific patient reports of quality of life and activities of daily living. Other exploratory assessments include the six minute walk test, spirometry, and muscle ultrasound. There is also an assessment of day-to-day mobility using wearable sensors.
The clinical outcome assessments were RWS, FSHD-TUG, muscle strength, motor function ability and generic and FSHD-specific patient reports of quality of life and activities of daily living. Other exploratory assessments included the six minute walk test, spirometry, and muscle ultrasound. There was also an assessment of day-to-day mobility using wearable sensors.
FTX-6058 Currently, our patent portfolio related to FTX-6058 includes two issued U.S. patents directed to composition of matter that is expected to expire in 2040, two U.S. non-provisional applications and related pending patent applications in Canada 25 and Mexico, Europe, Africa, Australia and New Zealand, South America, and Asia that, if issued, are expected to expire between 2039 and 2040.
Pociredir Currently, our patent portfolio related to pociredir includes two issued U.S. patents directed to composition of matter that is expected to expire in 2040, one U.S. non-provisional application and related pending patent applications in Canada and Mexico, Europe, Africa, Australia and New Zealand, South America, and Asia that, if issued, are expected to expire between 2039 and 2040.
HBG mRNA Mean Fold Induction for FTX-6058 versus Placebo 2mg* 6mg* 10mg* 20 mg 30mg Mean Fold Induction P-value Mean Fold Induction P-value Mean Fold Induction P-value Mean Fold Induction P-value Mean Fold Induction P-value Day 7 1.28 0.3494 1.94 0.0135 2.08 0.0063 2.06 0.0072 2.29 0.0025 Day 14 1.20 0.5122 2.45 0.0025 3.54 5.63 6.15 Safety Follow-up (Day 21-24) 1.21 0.3736 2.75 3.22 6.45 6.13 FTX-6058 Activity in Preclinical Studies We have observed in vitro and in vivo activation of the HBG1/2 genes in preclinical studies with FTX-6058.
HBG mRNA Mean Fold Induction for pociredir versus Placebo 2 mg* 6 mg* 10 mg* 20 mg 30 mg Mean Fold Induction P-value Mean Fold Induction P-value Mean Fold Induction P-value Mean Fold Induction P-value Mean Fold Induction P-value Day 7 1.28 0.3494 1.94 0.0135 2.08 0.0063 2.06 0.0072 2.29 0.0025 Day 14 1.20 0.5122 2.45 0.0025 3.54 5.63 6.15 Safety Follow-up (Day 21-24) 1.21 0.3736 2.75 3.22 6.45 6.13 Pociredir Activity in Preclinical Studies We have observed in vitro and in vivo activation of the HBG1/2 genes in preclinical studies with pociredir.
Losmapimod was generally well-tolerated and the majority of TEAEs were deemed unlikely related or not related to study drug by the investigator. There were three SAEs (post-op wound infection, alcohol poisoning and a suicide attempt) reported in two participants in the losmapimod group, each assessed as unrelated to losmapimod. There were no deaths or 10 discontinuations due to adverse events.
Losmapimod was generally well-tolerated and the majority of treatment emergent adverse events, or TEAEs, were deemed unlikely related or not related to study drug by the investigator. There were three SAEs (post-op wound infection, alcohol poisoning and a suicide attempt) reported in two participants in the losmapimod group, each assessed as unrelated to losmapimod.
Although many of the existing state privacy laws exempt clinical trial information and health information governed by HIPAA, future privacy and data protection laws may be broader in scope.
Although many of the existing state privacy laws exempt clinical trial information and health information governed by HIPAA, future privacy and data protection laws may be broader in scope and apply to our business.
According to the World Health Organization, the global incidence is estimated to be approximately 300,000 births annually. SCD is most prevalent in Africa and the Middle East. Approved drug treatments for SCD focus primarily on the management and reduction of painful vaso-occlusive crises, and improvement of hemolytic anemia.
According to the World Health Organization, the global incidence is estimated to be approximately 300,000 births annually. SCD is most prevalent in Africa and the Middle East. Several approved drug treatments for SCD focus primarily on the management and reduction of painful vaso-occlusive crises, and improvement of hemolytic anemia, as well as gene therapies for the treatment of severe SCD.
We also observed improved biomarkers of hemolysis in evaluable subjects dosed at 6 mg. The figures below illustrate percentage HbF increase by HPLC and absolute percentage HbF change from baseline for evaluable subjects (n=7) in the 6 mg dose cohort.
We also observed improved biomarkers of hemolysis in evaluable subjects dosed at 6 mg. The figures below illustrate percentage HbF increase by HPLC and absolute percentage HbF change from baseline for evaluable subjects (n=7) in the 6 mg dose cohort. Subjects with asterisks were on background hydroxyurea.
We observed that FTX-6058 elevated levels of HbF with minimal adverse effects on important cellular health markers.
We observed that pociredir elevated levels of HbF with minimal adverse effects on important cellular health markers.
As a result of the ongoing COVID-19 pandemic, we extended the ReDUX4 treatment period from 24 to 48 weeks through a protocol amendment to ensure the safety of the subjects and to allow for the opportunity for a biopsy at week 16 as originally intended or at week 36.
As a result of the impact of the COVID-19 pandemic on clinical site visits, we extended the ReDUX4 treatment period from 24 to 48 weeks through a protocol amendment to ensure the safety of the subjects and to allow for the opportunity for a biopsy either at week 16 as originally intended or at week 36.
There are no approved therapies for the treatment of FSHD. Current treatment is limited to symptomatic management including physical/ occupational therapy, low-intensity aerobic exercise tailored to the patient’s distribution of weakness, and general pain management, which may provide limited beneficial effect.
Current treatment of FSHD is limited to symptomatic management including physical/ occupational therapy, low-intensity aerobic exercise tailored to the patient’s distribution of weakness, and general pain management, which may provide limited beneficial effect.
FulcrumSeek Identified the Drug Target for Certain Hemoglobinopathies Applying FulcrumSeek, we conducted target identification and validation activities using human umbilical cord blood-derived erythroid progenitor 2, or HUDEP2, cells as a model to study HbF reactivation. HUDEP2 cells are immature RBCs.
Identification of the Drug Target for SCD We conducted target identification and validation activities using human umbilical cord blood-derived erythroid progenitor 2, or HUDEP2, cells as a model to study HbF reactivation. HUDEP2 cells are immature RBCs.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFor example: • portions of our product engine are protected by trade secrets, but much of our product engine is not protected by intellectual property, including patents, trade secrets and know-how, and we may not be able to develop, acquire or in-license any patentable technologies or other intellectual property related to the unprotected portions of our product engine; • others may be able to make product candidates that are similar to ours but that are not covered by the claims of the patents that we own; 76 • we, or our license partners or current or future collaborators, might not have been the first to make the inventions covered by the issued patent or pending patent applications that we license or may own in the future; • we, or our license partners or current or future collaborators, might not have been the first to file patent applications covering certain of our or their inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our owned or in-licensed intellectual property rights; • it is possible that our owned and in-licensed pending patent applications or those we may own or in-license in the future will not lead to issued patents; • issued patents that we hold rights to may be held invalid or unenforceable, including as a result of legal challenges by our competitors; • our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • we cannot ensure that any of our patents, or any of our pending patent applications, if issued, or those of our licensors, will include claims having a scope sufficient to protect our product candidates; • we cannot ensure that any patents issued to us or our licensors will provide a basis for an exclusive market for our commercially viable product candidates or will provide us with any competitive advantages; • we cannot ensure that our commercial activities or product candidates will not infringe upon the patents of others; • we cannot ensure that we will be able to successfully commercialize our product candidates on a substantial scale, if approved, before the relevant patents that we own or license expire; • we may not develop additional proprietary technologies that are patentable; • the patents of others may harm our business; and • we may choose not to file a patent in order to maintain certain trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property.
Biggest changeFor example: • others may be able to make product candidates that are similar to ours but that are not covered by the claims of the patents that we own; • we, or our license partners or current or future collaborators, might not have been the first to make the inventions covered by the issued patent or pending patent applications that we license or may own in the future; • we, or our license partners or current or future collaborators, might not have been the first to file patent applications covering certain of our or their inventions; • others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our owned or in-licensed intellectual property rights; • it is possible that our owned and in-licensed pending patent applications or those we may own or in-license in the future will not lead to issued patents; • issued patents that we hold rights to may be held invalid or unenforceable, including as a result of legal challenges by our competitors; • our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets; • we cannot ensure that any of our patents, or any of our pending patent applications, if issued, or those of our licensors, will include claims having a scope sufficient to protect our product candidates; • we cannot ensure that any patents issued to us or our licensors will provide a basis for an exclusive market for our commercially viable product candidates or will provide us with any competitive advantages; • we cannot ensure that our commercial activities or product candidates will not infringe upon the patents of others; • we cannot ensure that we will be able to successfully commercialize our product candidates on a substantial scale, if approved, before the relevant patents that we own or license expire; • portions of our discovery technology are protected by trade secrets, but much is not protected by intellectual property, including patents, trade secrets and know-how, and we may not be able to develop, acquire or in-license any patentable technologies or other intellectual property related to the unprotected portions of our discovery portfolio; • we may not develop additional proprietary technologies that are patentable; • the patents of others may harm our business; and • we may choose not to file a patent in order to maintain certain trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property.
Increased volatility and decreases in market prices of equity securities generally and of our common stock in particular may have an adverse impact on our willingness and/or ability to continue to sell our common stock through our ATM offering program.
Increased volatility and decreases in market prices of equity securities generally and of our common stock in particular may have an adverse impact on our willingness and/or ability to continue to sell our common stock through an ATM offering program.
The exclusivity period in the European Union can be reduced to six years at the end of the fifth year it is determined that a drug no longer meets the criteria for orphan drug designation, including if the drug is sufficiently profitable so that market exclusivity is no longer justified.
The exclusivity period in the European Union can be reduced to six years at the end of the fifth year if it is determined that a drug no longer meets the criteria for orphan drug designation, including if the drug is sufficiently profitable so that market exclusivity is no longer justified.
However, a failure or delay in obtaining regulatory approval in one country may have a negative effect on the regulatory process in other countries. We may not be able to file for marketing approvals and may not receive necessary approvals to commercialize our products in any market.
However, a failure or delay in obtaining regulatory approval in one country may have a negative effect on the regulatory process in other countries. We may not be able to file for marketing approvals and may not receive the necessary approvals to commercialize our products in any market.
Patient enrollment is affected by a variety of other factors, including: • the prevalence and severity of the disease under investigation; • the eligibility criteria for the trial in question; • the perceived risks and benefits of the product candidate under trial; • the requirements of the trial protocols, including invasive procedures such as muscle biopsies or medical resonance imaging (MRI), which requires the use of specialized equipment; 56 • the availability of existing treatments for the indications for which we are conducting clinical trials; • the ability to recruit clinical trial investigators with the appropriate competencies and experience; • the efforts to facilitate timely enrollment in clinical trials; • the patient referral practices of physicians; • the ability to monitor patients adequately during and after treatment; • the proximity and availability of clinical trial sites for prospective patients; • the conduct of clinical trials by competitors for product candidates that treat the same indications as our product candidates; • the ability to identify specific patient populations for biomarker-defined trial cohort(s); and • the cost to, or lack of adequate compensation for, prospective patients.
Patient enrollment is affected by a variety of other factors, including: • the prevalence and severity of the disease under investigation; • the eligibility criteria for the trial in question; • the perceived risks and benefits of the product candidate under trial; • the requirements of the trial protocols, including invasive procedures such as muscle biopsies or medical resonance imaging (MRI), which requires the use of specialized equipment; • the availability of existing treatments for the indications for which we are conducting clinical trials; • the ability to recruit clinical trial investigators with the appropriate competencies and experience; • the efforts to facilitate timely enrollment in clinical trials; • the patient referral practices of physicians; • the ability to monitor patients adequately during and after treatment; • the proximity and availability of clinical trial sites for prospective patients; • the conduct of clinical trials by competitors for product candidates that treat the same indications as our product candidates; • the ability to identify specific patient populations for biomarker-defined trial cohort(s); and • the cost to, or lack of adequate compensation for, prospective patients.
In addition, later discovery of previously unknown adverse events or other problems with our products, manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may have various consequences, including: • suspension of or restrictions on such products, manufacturers or manufacturing processes; • restrictions and warnings on the labeling or marketing of a product; • restrictions on product distribution or use; • requirements to conduct post-marketing studies or clinical trials; • warning letters or untitled letters; 80 • withdrawal of the products from the market; • refusal to approve pending applications or supplements to approved applications that we submit; • recall of products; • fines, restitution or disgorgement of profits or revenues; • suspension of any ongoing clinical trials; • suspension or withdrawal of marketing approvals; • damage to relationships with any potential collaborators; • unfavorable press coverage and damage to our reputation; • refusal to permit the import or export of our products; • product seizure or detention; • injunctions or the imposition of civil or criminal penalties; or • litigation involving patients using our products.
In addition, later discovery of previously unknown adverse events or other problems with our products, manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may have various consequences, including: • suspension of or restrictions on such products, manufacturers or manufacturing processes; • restrictions and warnings on the labeling or marketing of a product; • restrictions on product distribution or use; • requirements to conduct post-marketing studies or clinical trials; • warning letters or untitled letters; • withdrawal of the products from the market; • refusal to approve pending applications or supplements to approved applications that we submit; • recall of products; • fines, restitution or disgorgement of profits or revenues; • suspension of any ongoing clinical trials; • suspension or withdrawal of marketing approvals; • damage to relationships with any potential collaborators; • unfavorable press coverage and damage to our reputation; • refusal to permit the import or export of our products; • product seizure or detention; • injunctions or the imposition of civil or criminal penalties; or • litigation involving patients using our products.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for any product candidates or products that we may develop; • injury to our reputation and significant negative media attention; • withdrawal of clinical trial participants; • significant costs to defend any related litigation; • substantial monetary awards to trial participants or patients; 64 • loss of revenue; • reduced resources of our management to pursue our business strategy; and • the inability to commercialize any products that we may develop.
Regardless of merit or eventual outcome, liability claims may result in: • decreased demand for any product candidates or products that we may develop; • injury to our reputation and significant negative media attention; • withdrawal of clinical trial participants; • significant costs to defend any related litigation; • substantial monetary awards to trial participants or patients; • loss of revenue; • reduced resources of our management to pursue our business strategy; and • the inability to commercialize any products that we may develop.
Alternatively, if a court were to find the choice of forum provision contained in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially adversely affect our business, financial condition and operating results. 90 Item 1B. Unresolve d Staff Comments. Not applicable.
Alternatively, if a court were to find the choice of forum provision contained in our certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially adversely affect our business, financial condition and operating results. Item 1B. Unresolve d Staff Comments. Not applicable.
If any such claims are invalidated or rendered unenforceable for any reason, we will lose valuable intellectual property rights and our ability to prevent others from competing with us would be impaired. 68 Additionally, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted after issuance.
If any such claims are invalidated or rendered unenforceable for any reason, we will lose valuable intellectual property rights and our ability to prevent others from competing with us would be impaired. Additionally, the coverage claimed in a patent application can be significantly reduced before the patent is issued, and its scope can be reinterpreted after issuance.
The pharmaceutical industry has been a particular focus of these efforts and has been significantly 82 affected by legislative initiatives. Current laws, as well as other healthcare reform measures that may be adopted in the future, may result in more rigorous coverage criteria and in additional downward pressure on the price that we receive for any FDA approved product.
The pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by legislative initiatives. Current laws, as well as other healthcare reform measures that may be adopted in the future, may result in more rigorous coverage criteria and in additional downward pressure on the price that we receive for any FDA approved product.
However, we may not be able to obtain any required 72 license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors and other third parties access to the same technologies licensed to us and could require us to make substantial licensing and royalty payments.
However, we may not be able to obtain any required license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors and other third parties access to the same technologies licensed to us and could require us to make substantial licensing and royalty payments.
In addition, our supply chain may be adversely impacted if any of our third-party contract manufacturers become subject to injunctions or other sanctions as a result of their non-compliance with environmental, health and safety laws and regulations. 83 We are subject to anti-corruption laws, as well as export control laws, customs laws, sanctions laws and other laws governing our operations.
In addition, our supply chain may be adversely impacted if any of our third-party contract manufacturers become subject to injunctions or other sanctions as a result of their non-compliance with environmental, health and safety laws and regulations. We are subject to anti-corruption laws, as well as export control laws, customs laws, sanctions laws and other laws governing our operations.
Termination of these agreements or reduction or elimination of our rights under these agreements may 73 result in our having to negotiate new or reinstated agreements with less favorable terms, or cause us to lose our rights under these agreements, including our rights to important intellectual property or technology, which would have a material adverse effect on our business, financial condition, results of operations and prospects.
Termination of these agreements or reduction or elimination of our rights under these agreements may result in our having to negotiate new or reinstated agreements with less favorable terms, or cause us to lose our rights under these agreements, including our rights to important intellectual property or technology, which would have a material adverse effect on our business, financial condition, results of operations and prospects.
See Item 1 “Business—Competition” in this Annual Report on Form 10-K. 60 Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.
See Item 1 “Business—Competition” in this Annual Report on Form 10-K. Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.
This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. 89 Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, we are required to furnish a report by our management on our internal control over financial reporting.
This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, we are required to furnish a report by our management on our internal control over financial reporting.
In addition, the uncertainties associated with litigation could have a material adverse 71 effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties, or enter into development partnerships that would help us bring our product candidates to market.
In addition, the uncertainties associated with litigation could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties, or enter into development partnerships that would help us bring our product candidates to market.
If the FDA does not accept the data from any trial that we conduct outside the United 58 States, it would likely result in the need for additional trials, which would be costly and time-consuming and could delay or permanently halt our development of the applicable product candidates.
If the FDA does not accept the data from any trial that we conduct outside the United States, it would likely result in the need for additional trials, which would be costly and time-consuming and could delay or permanently halt our development of the applicable product candidates.
Our ability to generate revenues from these arrangements will depend on our collaborators’ abilities and efforts to successfully perform the functions assigned to them in these arrangements. 65 Collaborations that we enter into, including our collaboration with MyoKardia, may not be successful, and any success will depend heavily on the efforts and activities of such collaborators.
Our ability to generate revenues from these arrangements will depend on our collaborators’ abilities and efforts to successfully perform the functions assigned to them in these arrangements. Collaborations that we enter into, including our collaboration with MyoKardia, may not be successful, and any success will depend heavily on the efforts and activities of such collaborators.
Although we or our licensors are not currently involved in any litigation, we may become involved in lawsuits to protect or enforce our patent or other intellectual property rights, which could be expensive, time-consuming and unsuccessful. Competitors and other third parties may infringe, misappropriate or otherwise violate our or our licensor’s issued patents or other intellectual property.
Although we or our licensors are not currently involved in any litigation to protect or enforce our patent or other intellectual property rights, we may become involved in such lawsuits, which could be expensive, time-consuming and unsuccessful. Competitors and other third parties may infringe, misappropriate or otherwise violate our or our licensor’s issued patents or other intellectual property.
Such registered shares can be freely sold in the public market upon issuance, subject to volume limitations applicable to affiliates. 88 We are an “emerging growth company,” and the reduced disclosure requirements applicable to emerging growth companies may make our common stock less attractive to investors.
Such registered shares can be freely sold in the public market upon issuance, subject to volume limitations applicable to affiliates. We are an “emerging growth company,” and the reduced disclosure requirements applicable to emerging growth companies may make our common stock less attractive to investors.
Such a loss of patent protection could have a material adverse impact on our business and our ability to commercialize or license our technology and product candidates. 70 Changes to patent laws in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.
Such a loss of patent protection could have a material adverse impact on our business and our ability to commercialize or license our technology and product candidates. Changes to patent laws in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products.
Generally, if a product with an orphan drug designation subsequently receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of marketing exclusivity, which precludes the FDA or the EMA from approving another marketing authorization application for the same drug for a certain time period.
Generally, if a product with an orphan drug designation subsequently receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of market exclusivity, which precludes the FDA or the EMA from approving another marketing authorization application for the same drug for a certain time period.
If any of the physicians or other 81 healthcare providers or entities with whom we expect to do business is found to be not in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from participation in government funded healthcare programs.
If any of the physicians or other healthcare providers or entities with whom we expect to do business is found to be not in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from participation in government funded healthcare programs.
Accordingly, if our cybersecurity measures or those of our service providers fail to protect against unauthorized access, attacks, compromise or the mishandling of data by our employees or contractors, then our reputation, customer trust, business, results of operations and financial condition could be adversely affected.
If our cybersecurity measures or those of our service providers fail to protect against unauthorized access, attacks, compromise or the mishandling of data by our employees or contractors, then our reputation, customer trust, business, results of operations and financial condition could be adversely affected.
For example, in response to the ongoing COVID-19 pandemic, the clinical trial sites for our ReDUX4 trial temporarily postponed trial-related activities, impacting our clinical trial execution plans, and we cannot be certain that we will not face other postponements or similar difficulties in the future.
For example, in response to the COVID-19 pandemic, the clinical trial sites for our ReDUX4 trial temporarily postponed trial-related activities, impacting our clinical trial execution plans, and we cannot be certain that we will not face other postponements or similar difficulties in the future.
Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we have patent protection or licenses but enforcement is not as strong as that in the United 74 States.
Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we have patent protection or licenses but enforcement is not as strong as that in the United States.
Thus, even if we seek to utilize the accelerated approval pathway for a product candidate, we may not experience a faster development or regulatory review or approval 79 process for that product. In addition, receiving accelerated approval does not assure that the product’s accelerated approval will ultimately be converted to a traditional approval.
Thus, even if we seek to utilize the accelerated approval pathway for a product candidate, we may not experience a faster development or regulatory review or approval process for that product. In addition, receiving accelerated approval does not assure that the product’s accelerated approval will ultimately be converted to a traditional approval.
We cannot be certain of 53 the timely completion or outcome of our preclinical testing and studies and cannot predict if the FDA or other regulatory agencies will accept our proposed clinical programs or if the outcome of our preclinical testing and studies will ultimately support the further development of our current or future product candidates.
We cannot be certain of the timely completion or outcome of our preclinical testing and studies and cannot predict if the FDA or other regulatory agencies will accept our proposed clinical programs or if the outcome of our preclinical testing and studies will ultimately support the further development of our current or future product candidates.
We cannot provide stockholders any assurance that we will be able to successfully identify additional product candidates with our product engine, including as a result of our collaboration with MyoKardia, advance any additional product candidates through the development process or successfully commercialize any such additional product candidates.
We cannot provide stockholders any assurance that we will be able to successfully identify additional product candidates, including as a result of our collaboration with MyoKardia, advance any additional product candidates through the development process or successfully commercialize any such additional product candidates.
If we commercialize our product candidates in foreign markets, we will be subject to additional risks and uncertainties, including: • economic weakness, including inflation, or political instability in particular economies and markets, which could include localized disputes that have a broader regional or global impact (such as the Russian invasion of Ukraine); • the burden of complying with complex and changing foreign regulatory, tax, accounting and legal requirements, many of which vary between countries; • different medical practices and customs in foreign countries affecting acceptance in the marketplace; • tariffs and trade barriers, as well as other governmental controls and trade restrictions; • other trade protection measures, import or export licensing requirements or other restrictive actions by U.S. or foreign governments; • longer accounts receivable collection times; • longer lead times for shipping; • compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; • workforce uncertainty in countries where labor unrest is common; • language barriers for technical training; • reduced protection of intellectual property rights in some foreign countries, and related prevalence of generic alternatives to therapeutics; • foreign currency exchange rate fluctuations and currency controls; • differing foreign reimbursement landscapes; • uncertain and potentially inadequate reimbursement of our products; and • the interpretation of contractual provisions governed by foreign laws in the event of a contract dispute.
If we commercialize our product candidates in foreign markets, we will be subject to additional risks and uncertainties, including: • economic weakness, including inflation, or political instability in particular economies and markets, which could include localized disputes that have a broader regional or global impact (such as the Russian invasion of Ukraine or recent hostilities in Israel and Gaza Strip); • the burden of complying with complex and changing foreign regulatory, tax, accounting and legal requirements, many of which vary between countries; • different medical practices and customs in foreign countries affecting acceptance in the marketplace; • tariffs and trade barriers, as well as other governmental controls and trade restrictions; • other trade protection measures, import or export licensing requirements or other restrictive actions by U.S. or foreign governments; • longer accounts receivable collection times; • longer lead times for shipping; • compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; • workforce uncertainty in countries where labor unrest is common; • language barriers for technical training; • reduced protection of intellectual property rights in some foreign countries, and related prevalence of generic alternatives to therapeutics; • foreign currency exchange rate fluctuations and currency controls; • differing foreign reimbursement landscapes; • uncertain and potentially inadequate reimbursement of our products; and • the interpretation of contractual provisions governed by foreign laws in the event of a contract dispute.
We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval or commercialize our product candidates, including: • regulators or institutional review boards, or IRBs, may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site; • we may experience delays in reaching, or fail to reach, agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites; • regulators may decide the design of our clinical trials is flawed, for example if our trial protocol does not evaluate treatment effects in trial subjects for a sufficient length of time; • clinical trials of our product candidates may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon product development programs; • we may be unable to establish clinical endpoints that applicable regulatory authorities would consider clinically meaningful, or, if we seek accelerated approval, biomarker efficacy endpoints that applicable regulatory authorities would consider likely to predict clinical benefit; • preclinical testing may produce results based on which we may decide, or regulators may require us, to conduct additional preclinical studies before we proceed with certain clinical trials, limit the scope of our clinical trials, halt ongoing clinical trials or abandon product development programs; 54 • the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate or participants may drop out of these clinical trials at a higher rate than we anticipate; • our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • we may decide, or regulators or IRBs may require us, to suspend or terminate clinical trials of our product candidates for various reasons, including noncompliance with regulatory requirements or a finding that the participants are being exposed to unacceptable health risks; • regulators or IRBs may require us to perform additional or unanticipated clinical trials to obtain approval or we may be subject to additional post-marketing testing requirements to maintain regulatory approval; • regulators may revise the requirements for approving our product candidates, or such requirements may not be as we anticipate; • the cost of clinical trials of our product candidates may be greater than we anticipate; • the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient or inadequate; • our product candidates may have undesirable side effects or other unexpected characteristics, causing us or our investigators, regulators or IRBs to suspend or terminate the trials; • unforeseen global instability, including political instability, such as the Russian invasion of Ukraine, or instability from an outbreak of pandemic or contagious disease, such as the ongoing COVID-19 pandemic, in or around the countries in which we conduct our clinical trials, could delay the commencement or rate of completion of our clinical trials; and • regulators may withdraw their approval of a product or impose restrictions on its distribution, such as in the form of a risk evaluation and mitigation strategy, or REMS.
We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval or commercialize our product candidates, including: • regulators or institutional review boards, or IRBs, may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site; • we may experience delays in reaching, or fail to reach, agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites; • regulators may decide the design of our clinical trials is flawed, for example if our trial protocol does not evaluate treatment effects in trial subjects for a sufficient length of time; • clinical trials of our product candidates may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon product development programs; • we may be unable to establish clinical endpoints that applicable regulatory authorities would consider clinically meaningful, or, if we seek accelerated approval, biomarker efficacy endpoints that applicable regulatory authorities would consider likely to predict clinical benefit; • preclinical testing may produce results based on which we may decide, or regulators may require us, to conduct additional preclinical studies before we proceed with certain clinical trials, limit the scope of our clinical trials, halt ongoing clinical trials or abandon product development programs; • the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate or participants may drop out of these clinical trials at a higher rate than we anticipate; • our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; • we may decide, or regulators or IRBs may require us, to suspend or terminate clinical trials of our product candidates for various reasons, including noncompliance with regulatory requirements or a finding that the participants are being exposed to unacceptable health risks; • regulators or IRBs may require us to perform additional or unanticipated clinical trials to obtain approval or we may be subject to additional post-marketing testing requirements to maintain regulatory approval; • regulators may revise the requirements for approving our product candidates, or such requirements may not be as we anticipate; • the cost of clinical trials of our product candidates may be greater than we anticipate; • the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient or inadequate; • our product candidates may have undesirable side effects or other unexpected characteristics, causing us or our investigators, regulators or IRBs to suspend or terminate the trials; • unforeseen global instability, including political instability, such as the Russian invasion of Ukraine or recent hostilities in Israel and Gaza Strip, or instability from an outbreak of pandemic or contagious disease in or around the countries in which we conduct our clinical trials, could delay the commencement or rate of completion of our clinical trials; and • regulators may withdraw their approval of a product or impose restrictions on its distribution, such as in the form of a risk evaluation and mitigation strategy, or REMS.
Given the breadth and depth of changes in privacy, data protection and consumer protection obligations, preparing for and complying with these requirements is rigorous and time intensive and requires significant resources and a review of our technologies, systems and practices, as well as those of any third-party collaborators, service providers, contractors or consultants that store, process or transfer personal data on our behalf.
Given the breadth and depth of changes in privacy, data protection and consumer protection obligations, preparing for and complying with these requirements is rigorous and time intensive and requires significant resources and ongoing review of our technologies, systems and practices, as well as those of any third-party collaborators, service providers, contractors or consultants that store, process or transfer personal data on our behalf.
The stock market in general and the market for smaller biopharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to 87 the operating performance of particular companies.
The stock market in general and the market for smaller biopharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies.
If that were to occur, the protection we derive from orphan exclusivity may be adversely affected. 78 Special designation by the FDA, such as fast track or breakthrough therapy, may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that our product candidates will receive marketing approval.
If that were to occur, the protection we derive from orphan exclusivity may be adversely affected. Designation by the FDA, such as fast track or breakthrough therapy, may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that our product candidates will receive marketing approval.
There are a broad variety of data protection and security laws and regulations that may be applicable to our activities governing the collection, use, disclosure, and protection of health-related and other personal information (including, for example, state data breach notification laws, health information and/or genetic privacy laws and federal and state consumer protection laws including Section 5 of the FTC Act, HIPAA, and the California Consumer Protection Act or CCPA).
There are a broad variety of privacy and data security laws and regulations that may be applicable to our activities governing the collection, use, disclosure, and protection of health-related and other personal information (including, state data breach notification laws, health information and/or genetic privacy laws and federal and state consumer protection laws including Section 5 of the FTC Act, HIPAA, and the California Consumer Privacy Act, or CCPA).
Collaborations pose a number of risks, including the following: • collaborators have significant discretion in determining the amount and timing of efforts and resources that they will apply to these collaborations; • collaborators may not perform their obligations as expected; • collaborators may not pursue development of our product candidates or may elect not to continue or renew development programs based on results of clinical trials or other studies, changes in the collaborators’ strategic focus or available funding, or external factors, such as an acquisition, that divert resources or create competing priorities; • collaborators may not pursue commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew commercialization programs based on results of clinical trials or other studies, changes in the collaborators’ strategic focus or available funding, or external factors, such as an acquisition, that may divert resources or create competing priorities; • collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing; • we may not have access to, or may be restricted from disclosing, certain information regarding product candidates being developed or commercialized under a collaboration and, consequently, may have limited ability to inform our stockholders about the status of such product candidates on a discretionary basis; • collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidates and products if the collaborators believe that the competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours; • product candidates discovered in collaboration with us may be viewed by our collaborators as competitive with their own product candidates or products, which may cause collaborators to cease to devote resources to the commercialization of our product candidates; • a collaborator may fail to comply with applicable regulatory requirements regarding the development, manufacture, distribution or marketing of a product candidate or product; • a collaborator with marketing and distribution rights to one or more of our product candidates that achieve regulatory approval may not commit sufficient resources to the marketing and distribution of such product or products; • disagreements with collaborators, including disagreements over intellectual property or proprietary rights, contract interpretation or the preferred course of development, might cause delays or terminations of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive; • collaborators may not properly obtain, maintain, enforce, defend or protect our intellectual property or proprietary rights or may use our proprietary information in such a way as to potentially lead to disputes or legal proceedings that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation; • disputes may arise with respect to the ownership of intellectual property developed pursuant to our collaborations; • collaborators may infringe, misappropriate or otherwise violate the intellectual property or proprietary rights of third parties, which may expose us to litigation and potential liability; and • collaborations may be terminated for the convenience of the collaborator (e.g., termination of our collaboration with Acceleron following its acquisition by Merck), and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates. 66 Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner, or at all.
Collaborations pose a number of risks, including the following: • collaborators have significant discretion in determining the amount and timing of efforts and resources that they will apply to these collaborations; • collaborators may not perform their obligations as expected; • collaborators may not pursue development of our product candidates or may elect not to continue or renew development programs based on results of clinical trials or other studies, changes in the collaborators’ strategic focus or available funding, or external factors, such as an acquisition, that divert resources or create competing priorities; • collaborators may not pursue commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew commercialization programs based on results of clinical trials or other studies, changes in the collaborators’ strategic focus or available funding, or external factors, such as an acquisition, that may divert resources or create competing priorities; • collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing; • we may not have access to, or may be restricted from disclosing, certain information regarding product candidates being developed or commercialized under a collaboration and, consequently, may have limited ability to inform our stockholders about the status of such product candidates on a discretionary basis; • collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with our product candidates and products if the collaborators believe that the competitive products are more likely to be successfully developed or can be commercialized under terms that are more economically attractive than ours; • product candidates discovered in collaboration with us may be viewed by our collaborators as competitive with their own product candidates or products, which may cause collaborators to cease to devote resources to the commercialization of our product candidates; • a collaborator may fail to comply with applicable regulatory requirements regarding the development, manufacture, distribution or marketing of a product candidate or product; • a collaborator with marketing and distribution rights to one or more of our product candidates that achieve regulatory approval may not commit sufficient resources to the marketing and distribution of such product or products; • disagreements with collaborators, including disagreements over intellectual property or proprietary rights, contract interpretation or the preferred course of development, might cause delays or terminations of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive; • collaborators may not properly obtain, maintain, enforce, defend or protect our intellectual property or proprietary rights or may use our proprietary information in such a way as to potentially lead to disputes or legal proceedings that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation; • disputes may arise with respect to the ownership of intellectual property developed pursuant to our collaborations; • collaborators may infringe, misappropriate or otherwise violate the intellectual property or proprietary rights of third parties, which may expose us to litigation and potential liability; and • collaborations may be terminated for the convenience of the collaborator (e.g., termination of our collaboration with Acceleron Pharma, Inc., or Acceleron, following its acquisition by Merck & Co., or Merck), and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates.
If we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully develop and commercialize our product candidates, which would materially harm our business. We may not be successful in our efforts to use our product engine to build a pipeline of product candidates.
If we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully develop and commercialize our product candidates, which would materially harm our business. We may not be successful in our efforts to build a pipeline of product candidates.
We are party to license and funding agreements, such as our agreement with GSK, and we may enter into additional licensing and funding arrangements with third parties that impose or may impose diligence, development and commercialization timelines, milestone payment, royalty, insurance and other obligations on us.
We are party to license and funding agreements, such as our agreement with GSK and our recent license agreement with CAMP4, and we may enter into additional licensing and funding arrangements with third parties that impose or may impose diligence, development and commercialization timelines, milestone payment, royalty, insurance and other obligations on us.
Commercial revenues, if any, will not be derived unless and until we can achieve sales of products, which we do not anticipate for many years, if at all. Accordingly, we will need to continue to rely on additional financing to achieve our business objectives.
Commercial revenues, if any, will not be derived unless and until we can achieve sales of products, which we do not anticipate for several years, if at all. Accordingly, we will need to continue to rely on additional financing to achieve our business objectives.
In addition to seeking patents for our product candidates, we also rely on trade secrets and confidentiality agreements to protect our unpatented know-how, technology and other proprietary information, to maintain our competitive position, including certain aspects of our proprietary product engine.
In addition to seeking patents for our product candidates, we also rely on trade secrets and confidentiality agreements to protect our unpatented know-how, technology and other proprietary information, to maintain our competitive position, including certain aspects of our discovery technology.
In either scenario, our clinical trial supply could be delayed significantly as we establish alternative 61 supply sources.
In either scenario, our clinical trial supply could be delayed significantly as we establish alternative supply sources.
Our ability to generate product revenues, which we do not expect will occur for many years, if ever, will depend heavily on the successful development, regulatory approval and eventual commercialization of our product candidates.
Our ability to generate product revenues, which we do not expect will occur for several years, if ever, will depend heavily on the successful development, regulatory approval and eventual commercialization of our product candidates.
We conducted an analysis under Section 382 to determine if historical changes in ownership through December 31, 2021 would limit or otherwise restrict our ability to utilize our pre-change net operating losses and research and development tax credit carryforwards to offset future taxable income.
We conducted an analysis under Section 382 of the Code to determine if historical changes in ownership through December 31, 2021 would limit or otherwise restrict our ability to utilize our pre-change net operating losses and research and development tax credit carryforwards to offset future taxable income.
For example, while we believe that the specific and generic claims contained in our U.S. patent provide protection for the method of using losmapimod for the treatment of FSHD and while we also believe that the specific and generic claims contained in our issued and pending U.S. non-provisional and provisional applications provide protection for the pharmaceutical compositions and methods of use for FTX-6058, third parties may nevertheless challenge such claims.
For example, while we believe that the specific and generic claims contained in our U.S. patent provide protection for the method of using losmapimod for the treatment of FSHD and while we also believe that the specific and generic claims contained in our issued and pending U.S. non-provisional and provisional applications provide protection for the pharmaceutical compositions and methods of use for pociredir, third parties may nevertheless challenge such claims.
In May 2022, we established a new ATM offering program to sell shares of our common stock having an aggregate offering price of up to $50.0 million from time to time.
In May 2022, we established an ATM offering program to sell shares of our common stock having an aggregate offering price of up to $50.0 million from time to time.
The success of our product candidates will depend on several factors, including the following: • successfully completing preclinical studies and clinical trials; • allowance by the FDA or other regulatory agencies of the INDs, clinical trial applications, or CTAs, or other regulatory filings for losmapimod, FTX-6058 and future product candidates, including our ability to resolve the current clinical hold on FTX-6058 for SCD; 52 • expanding and maintaining a workforce of experienced scientists and others to continue to develop our product candidates; • applying for and receiving marketing approvals from applicable regulatory authorities; • obtaining and maintaining intellectual property protection and regulatory exclusivity for our product candidates; • making arrangements with third-party manufacturers for, or establishing, commercial manufacturing capabilities; • establishing sales, marketing and distribution capabilities and successfully launching commercial sales of the products, if and when approved, whether alone or in collaboration with others; • acceptance of the products, if and when approved, by patients, the medical community and third-party payors; • effectively competing with other therapies; • obtaining and maintaining coverage, adequate pricing and adequate reimbursement from third-party payors, including government payors; • maintaining, enforcing, defending and protecting our rights in our intellectual property portfolio; • not infringing, misappropriating or otherwise violating others’ intellectual property or proprietary rights; and • maintaining a continued acceptable safety profile of the products following receipt of any regulatory approvals.
The success of our product candidates will depend on several factors, including the following: • successfully completing preclinical studies and clinical trials; • allowance by the FDA or other regulatory agencies of the INDs, clinical trial applications, or CTAs, or other regulatory filings for losmapimod, pociredir and future product candidates; • expanding and maintaining a workforce of experienced scientists and others to continue to develop our product candidates; • applying for and receiving marketing approvals from applicable regulatory authorities; • obtaining and maintaining intellectual property protection and regulatory exclusivity for our product candidates; • making arrangements with third-party manufacturers for, or establishing, commercial manufacturing capabilities; • establishing sales, marketing and distribution capabilities and successfully launching commercial sales of the products, if and when approved, whether alone or in collaboration with others; • acceptance of the products, if and when approved, by patients, the medical community and third-party payors; • effectively competing with other therapies; • obtaining and maintaining coverage, adequate pricing and adequate reimbursement from third-party payors, including government payors; • maintaining, enforcing, defending and protecting our rights in our intellectual property portfolio; • not infringing, misappropriating or otherwise violating others’ intellectual property or proprietary rights; and • maintaining a continued acceptable safety profile of the products following receipt of any regulatory approvals.
Any investigation of any potential violations of the Bribery Act, the FCPA, other anti-corruption laws or Trade Control laws by United Kingdom, U.S. or other authorities could also have an adverse impact on our reputation, our business, results of operations and financial condition.
Any investigation of any potential violations of the Bribery Act, the FCPA, other anti-corruption laws or Trade Control laws by United Kingdom, United States or other authorities could also have an adverse impact on our reputation, our business, results of operations and financial condition.
There are approved products in the EZH2 class of medications and their approved labeling outlines safety risks, including an increased risk of malignancies. In the event that FTX-6058 has similar safety risks as other PRC2 medications, this could impact its acceptance.
There are approved products in the EZH2 class of medications and their approved labeling outlines safety risks, including an increased risk of malignancies. In the event that pociredir has similar safety risks as other PRC2 medications, this could impact its acceptance.
The market price for our common stock may be influenced by many factors, including: • results of or developments in preclinical studies and clinical trials of our product candidates or those of our competitors or potential collaborators, including the recent clinical hold on FTX-6058 (and whether or not we are able to resolve such hold); • our success in commercializing our product candidates, if and when approved; • the success of competitive products or technologies; • regulatory or legal developments in the United States and other countries; • developments or disputes concerning patent applications, issued patents or other intellectual property or proprietary rights; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • the results of our efforts to discover, develop, acquire or in-license products, product candidates, technologies or data referencing rights, the costs of commercializing any such products and the costs of development of any such product candidates or technologies; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or the financial results of companies that are perceived to be similar to us; • changes in the structure of healthcare payment systems; • market conditions in the pharmaceutical and biotechnology sectors; • general economic, industry and market conditions; and • the other factors described in this “Risk Factors” section.
The market price for our common stock may be influenced by many factors, including: • results of or developments in preclinical studies and clinical trials of our product candidates or those of our competitors or potential collaborators; • our success in commercializing our product candidates, if and when approved; • the success of competitive products or technologies; • regulatory or legal developments in the United States and other countries; • developments or disputes concerning patent applications, issued patents or other intellectual property or proprietary rights; • the recruitment or departure of key personnel; • the level of expenses related to any of our product candidates or clinical development programs; • the results of our efforts to discover, develop, acquire or in-license products, product candidates, technologies or data referencing rights, the costs of commercializing any such products and the costs of development of any such product candidates or technologies; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or the financial results of companies that are perceived to be similar to us; • changes in the structure of healthcare payment systems; • market conditions in the pharmaceutical and biotechnology sectors; • general economic, industry and market conditions; and • the other factors described in this “Risk Factors” section.
We expect to devote substantial financial resources to our ongoing and planned activities, particularly as we continue our ongoing and planned clinical trials of losmapimod and FTX-6058, continue research and development and initiate additional clinical trials of, and seek regulatory approval for, these and other product candidates.
We expect to devote substantial financial resources to our ongoing and planned activities, particularly as we continue our ongoing and planned clinical trials of losmapimod and pociredir, continue research and development and initiate additional clinical trials of, and seek regulatory approval for, these and other product candidates.
As of December 31, 2022, we also had federal and state research and development tax credit carryforwards of $6.9 million and $4.0 million, respectively, which begin to expire in 2035 and 2030, respectively. These net operating loss and tax credit carryforwards could expire unused and be unavailable to offset future income tax liabilities.
As of December 31, 2023, we also had federal and state research and development tax credit carryforwards of $7.6 million and $4.9 million, respectively, which begin to expire in 2035 and 2030, respectively. These net operating loss and tax credit carryforwards could expire unused and be unavailable to offset future income tax liabilities.
If such additional adverse events were to emerge, further advancement of our clinical studies could be halted or delayed and we may not receive regulatory approval for FTX-6058.
If such additional adverse events were to emerge, further advancement of our clinical studies could be halted or delayed and we may not receive regulatory approval for pociredir.
The FDA granted fast track designation to losmapimod for the treatment of FSHD and to FTX-6058 for the treatment of SCD, and we may seek fast track designation for some of our other product candidates as well as breakthrough therapy designation, including for losmapimod.
The FDA granted fast track designation to losmapimod for the treatment of FSHD and to pociredir for the treatment of SCD, and we may seek fast track designation for some of our other product candidates as well as breakthrough therapy designation, including for losmapimod.
Even if we receive regulatory approval for FTX-6058, our labeling may be restricted and/or market acceptance for our product may be diminished, and the commercial potential of our FTX-6058 program may be materially and negatively impacted.
Even if we receive regulatory approval for pociredir, our labeling may be restricted and/or market acceptance for our product may be diminished, and the commercial potential of our pociredir program may be materially and negatively impacted.
If we do not successfully identify, develop, obtain regulatory approval for and commercialize product candidates based upon our technological approach, we will not be able to generate product revenues. Clinical drug development involves a lengthy and expensive process, with an uncertain outcome. The results of preclinical studies and early clinical trials may not be predictive of future results.
If we do not successfully identify, develop, obtain regulatory approval for and commercialize product candidates, we will not be able to generate product revenues. Clinical drug development involves a lengthy and expensive process, with an uncertain outcome. The results of preclinical studies and early clinical trials may not be predictive of future results.
However, if certain formalities and requirements are not met, our European patents and patent applications could be challenged for non-compliance and brought under the jurisdiction of the UPC. We cannot be certain that our European patents and patent applications will avoid falling under the jurisdiction of the UPC, if we decide to opt out of the UPC.
However, if certain formalities and requirements are not met, our European patents and patent applications could be challenged for non-compliance and brought under the jurisdiction of the UPC. We cannot be certain that our European patents and patent applications will avoid falling under the jurisdiction of the UPC.
If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, we may: • be delayed in obtaining marketing approval for our product candidates; • not obtain marketing approval at all; • obtain approval for indications or patient populations that are not as broad as intended or desired; • obtain approval with labeling or a REMS that includes significant use or distribution restrictions or safety warnings; • be subject to additional post-marketing testing requirements; or • have the product removed from the market after obtaining marketing approval. 55 Our product development costs will also increase if we experience delays in testing or in obtaining marketing approvals.
If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, we may: • be delayed in obtaining marketing approval for our product candidates; • not obtain marketing approval at all; • obtain approval for indications or patient populations that are not as broad as intended or desired; • obtain approval with labeling or a REMS that includes significant use or distribution restrictions or safety warnings; • be subject to additional post-marketing testing requirements; or • have the product removed from the market after obtaining marketing approval.
The ongoing COVID-19 pandemic already caused significant disruptions in the financial markets, and it may continue to, and any future pandemic could similarly, cause such disruptions, which could impact our ability to raise additional funds 51 through public offerings and may also impact the volatility of our stock price and trading in our stock.
The COVID-19 pandemic caused significant disruptions in the financial markets and any future pandemic could similarly cause such disruptions, which could impact our ability to raise additional funds through public offerings and may also impact the volatility of our stock price and trading in our stock.
We expect to rely on third parties for the manufacture of FTX-6058 for any future clinical trials and for the manufacture of any future product candidates for preclinical and clinical testing.
We expect to rely on third parties for the manufacture of pociredir for any future clinical trials and for the manufacture of any future product candidates for preclinical and clinical testing.
Any of these occurrences could materially harm our business. 57 If any of our product candidates receives marketing approval and we, or others, later discover that the drug is less effective than previously believed or causes undesirable side effects that were not previously identified, our ability to market the drug could be compromised.
If any of our product candidates receives marketing approval and we, or others, later discover that the drug is less effective than previously believed or causes undesirable side effects that were not previously identified, our ability to market the drug could be compromised.
Internal Revenue Code of 1986, as amended, or the Code, and corresponding provisions of state law, a corporation that undergoes an “ownership change,” which is generally defined as a greater than 50% change, by value, in its equity ownership by certain stockholders over a three-year period, is subject to limitations on its ability to utilize its pre-change net operating losses and research and development tax credit carryforwards to offset future taxable income.
In general, under Section 382 of the Code, and corresponding provisions of state law, a corporation that undergoes an “ownership change,” which is generally defined as a greater than 50% change, by value, in its equity ownership by certain stockholders over a three-year period, is subject to limitations on its ability to utilize its pre-change net operating losses and research and development tax credit carryforwards to offset future taxable income.
There can be no assurance that any development problems we experience in the future related to our proprietary product engine or any of our research or development programs will not cause significant delays or unanticipated costs, or that such development problems can be solved.
There can be no assurance that any development problems we experience in the future related to our discovery technologies or any of our research or development programs will not cause significant delays or unanticipated costs, or that such development problems can be solved.
We also have licenses and agreements to certain technologies used in our product engine, all of which are non-exclusive. While we still face all of the risks described herein with respect to those agreements, we cannot prevent third parties from also accessing those technologies. In addition, our licenses may place restrictions on our future business opportunities.
We also have licenses and agreements to certain technologies that we use in our discovery efforts, all of which are non-exclusive. While we still face all of the risks described herein with respect to those agreements, we cannot prevent third parties from also accessing those technologies. In addition, our licenses may place restrictions on our future business opportunities.
Our business was negatively impacted by the ongoing COVID-19 pandemic and may in the future be impacted by any future pandemics. In addition, this pandemic may continue to, and any future pandemics may, adversely impact economies worldwide, which could result in adverse effects on our business and operations.
Our business was negatively impacted by the COVID-19 pandemic and may in the future be impacted by any future pandemics. In addition, the effects of any future pandemics may, adversely impact economies worldwide, which could result in adverse effects on our business and operations.
Furthermore, replacing executive officers and key employees may be difficult and may take an extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to successfully develop, gain regulatory approval of and commercialize products.
Additionally, the number of recent departures has created some uncertainty. Furthermore, replacing executive officers and key employees may be difficult and may take an extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to successfully develop, gain regulatory approval of and commercialize products.
We anticipate that our expenses will increase substantially as we: • continue our clinical development of losmapimod and seek to resolve the clinical hold on FTX-6058; • continue our ongoing preclinical studies; • advance clinical-stage product candidates through later stage trials, such as REACH, the Phase 3 clinical trial of losmapimod for the treatment of FSHD; • pursue the discovery of drug targets for other genetically-defined rare diseases and the subsequent development of any resulting product candidates; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • scale up our manufacturing processes and capabilities, or arrange for a third party to do so on our behalf, to support our clinical trials of our product candidates and commercialization of any of our product candidates for which we may obtain marketing approval; • establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain regulatory approval; • acquire or in-license products, product candidates, technologies and/or data referencing rights; • make any milestone payments to affiliates of GSK, under our right of reference and license agreement with GSK upon the achievement of specified clinical or regulatory milestones; • maintain, expand, enforce, defend and protect our intellectual property; • hire additional clinical, quality control and scientific personnel; and • add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts and our operations as a public company. 48 To become and remain profitable, we must succeed in developing, and eventually commercializing, a product or products that generate significant revenue.
We anticipate that our expenses will increase substantially as we: • continue our clinical development of losmapimod and pociredir; • continue our ongoing preclinical studies; • advance clinical-stage product candidates through later stage trials, such as REACH, the Phase 3 clinical trial of losmapimod for the treatment of FSHD; • pursue the discovery of drug targets for other genetically-defined rare diseases and the subsequent development of any resulting product candidates, including for Diamond Blackfan Anemia under our recent license agreement with CAMP4; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • scale up our manufacturing processes and capabilities, or arrange for a third party to do so on our behalf, to support our clinical trials of our product candidates and commercialization of any of our product candidates for which we may obtain marketing approval; • establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain regulatory approval; • acquire or in-license products, product candidates, technologies and/or data referencing rights, such as our recent agreement with CAMP4; • make any milestone payments to affiliates of GlaxoSmithKline plc, or GSK, under our right of reference and license agreement with GSK upon the achievement of specified clinical or regulatory milestones, or to CAMP4 under our license agreement with CAMP4; • maintain, expand, enforce, defend and protect our intellectual property; • hire additional clinical, quality control and scientific personnel; and • add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts and our operations as a public company.
If we elect or are forced to suspend or terminate any clinical trial of our product candidates, the commercial prospects of such product candidate will be harmed, and our ability to generate product revenue from such product candidate will be delayed or eliminated.
If we elect or are forced to suspend or terminate any clinical trial of our product candidates, the commercial prospects of such product candidate will be harmed, and our ability to generate product revenue from such product candidate will be delayed or eliminated. Any of these occurrences could materially harm our business.
We experienced enrollment delays in our ReDUX4 clinical trial due to the COVID-19 pandemic as the clinical trial sites for our ReDUX4 clinical trial temporarily postponed trial-related activities. We also saw temporary disruptions in other business activities due to a temporary reduction in workforce presence at our Cambridge research facility.
We experienced enrollment delays in our ReDUX4 clinical trial due to the COVID-19 pandemic as the clinical trial sites for our ReDUX4 clinical trial temporarily postponed trial-related activities. We also saw temporary disruptions in other business activities due to a temporary reduction in workforce presence at our Cambridge research facility, and COVID-19 had a significant impact on economies worldwide.
For example, on February 23, 2023, the FDA placed our IND for FTX-6058 on clinical hold based on hematological malignancies observed in nonclinical toxicology studies.
For example, in February 2023, the FDA placed our IND for pociredir on clinical hold based on hematological malignancies observed in nonclinical toxicology studies.
Our ability to use our net operating losses and research and development tax credit carryforwards to offset future taxable income may be subject to certain limitations. As of December 31, 2022, we had federal and state net operating loss carryforwards of $275.1 million and $272.6 million, respectively, which begin to expire in 2036.
Our ability to use our net operating losses and research and development tax credit carryforwards to offset future taxable income may be subject to certain limitations. As of December 31, 2023, we had federal and state net operating loss carryforwards of $312.3 million and $317.1 million, respectively, which begin to expire in 2036.
Our future capital requirements will depend on many factors, including: • the progress, costs and results of our ongoing clinical trials of losmapimod, including REACH, the Phase 3 clinical trial of losmapimod for the treatment of FSHD, which enrolled its first patient in June 2022, and our ability to resolve the clinical hold on the Phase 1b trial of FTX-6058; • additional planned clinical trials; • the scope, progress, costs and results of discovery research, preclinical development, laboratory testing and clinical trials for our current product candidates in additional indications or for any future product candidates that we may pursue; • the number of and development requirements for other product candidates that we pursue; • the costs, timing and outcome of regulatory review of our product candidates; • our ability to enter into contract manufacturing arrangements for supply of active pharmaceutical ingredient, or API, and manufacture of our product candidates and the terms of such arrangements; • the success of our collaboration with MyoKardia; • our ability to establish and maintain additional strategic collaborations, licensing or other arrangements and the financial terms of such arrangements; • the payment or receipt of milestones, royalties and other collaboration-based revenues, if any; • the costs and timing of future commercialization activities, including product manufacturing, sales, marketing and distribution, for any of our product candidates for which we may receive marketing approval; • the amount and timing of revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval; 49 • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights and defending any intellectual property-related claims; • the impact of the ongoing COVID-19 pandemic on our business and operations; and • the extent to which we acquire or in-license other products, product candidates, technologies or data referencing rights.
Our future capital requirements will depend on many factors, including: • the progress, costs and results of our ongoing clinical trials of losmapimod, including REACH, the Phase 3 clinical trial of losmapimod for the treatment of FSHD, which completed enrollment in September 2023, and our Phase 1b clinical trial of pociredir in SCD; • additional planned clinical trials; • the scope, progress, costs and results of discovery research, preclinical development, laboratory testing and clinical trials for our current product candidates in additional indications or for any future product candidates that we may pursue; • the number of and development requirements for other product candidates that we pursue; • the costs, timing and outcome of regulatory review of our product candidates; • our ability to enter into contract manufacturing arrangements for supply of active pharmaceutical ingredient, or API, and manufacture of our product candidates and the terms of such arrangements; • the success of our collaboration with MyoKardia or under our recent license agreement with CAMP4; • our ability to establish and maintain additional strategic collaborations, licensing or other arrangements and the financial terms of such arrangements; • the payment or receipt of milestones, royalties and other collaboration-based revenues, if any; • the costs and timing of future commercialization activities, including product manufacturing, sales, marketing and distribution, for any of our product candidates for which we may receive marketing approval; • the amount and timing of revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights and defending any intellectual property-related claims; • the extent to which we acquire or in-license other products, product candidates, technologies or data referencing rights.
We may also choose to further realign our operations to achieve additional operational efficiencies beyond our recently announced strategic realignment. Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates.
We may also choose to further realign our operations to achieve additional operational efficiencies beyond the strategic realignment commenced in August 2022. Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates.
In addition, although we believe we have obtained sufficient quantities of FTX-6058 from a CMO for the completion of our Phase 1b clinical trial for SCD if we are able to resolve the clinical hold, we cannot be sure we have correctly estimated our drug product requirements, which could delay, prevent or impair our development efforts.
In addition, although we believe we have obtained sufficient quantities of pociredir from a CMO for the completion of our Phase 1b clinical trial for SCD, we cannot be sure we have correctly estimated our drug product requirements, which could delay, prevent or impair our development efforts.
Clinical trials may fail to demonstrate that our product candidates are safe for humans and effective for indicated uses. For example, FTX-6058, our clinical trial stage candidate to treat SCD, is an EEDi. EED is a member of the PRC2 complex, which also includes EZH2.
Clinical trials may fail to demonstrate that our product candidates are safe for humans and effective for indicated uses. For example, pociredir, our clinical trial stage candidate to treat SCD, is an embryonic ectoderm development, or EED, inhibitor. EED is a member of the PRC2 complex, which also includes EZH2.
Currently, the most impactful point of divergence relates to transfer mechanisms (i.e., the ability for companies in the European Union or the United Kingdom to transfer personal information to third countries, including the United States), because it requires us to implement a variety of different contractual clauses approved by European Union’s or United Kingdom’s regulators.
Currently, the most impactful point of divergence relates to transfer mechanisms (i.e., the ability for companies in the European Union or the United Kingdom to transfer personal information to third countries, including the United States), because it requires us to implement a variety of different contractual clauses approved by European Union’s or United Kingdom’s regulators, and carry out transfer impact assessments to establish whether the third country can ensure essential equivalency.
As of March 2, 2023, our executive officers and directors and our stockholders who owned more than 5% of our outstanding common stock in the aggregate beneficially owned shares representing approximately 57.1% of our capital stock.
As of February 20, 2023, our executive officers and directors and our stockholders who owned more than 5% of our outstanding common stock in the aggregate beneficially owned shares representing approximately 48.6% of our capital stock.
For example, the collection, use, disclosure, transfer, or other processing of personal data regarding individuals in the European Union, including personal health data, is subject to the European Union’s General Data Protection Regulation, or EU GDPR, which took effect across all Member States of the European Economic Area, or EEA, in May 2018.
For example, the collection, use, disclosure, transfer, or other processing of personal data regarding individuals in the European Economic Area, or EEA, including personal health data, is subject to the European Union’s General Data Protection Regulation, or EU GDPR.
Following the withdrawal of the United Kingdom from the European Union, or Brexit, the EU GDPR has been incorporated into United Kingdom’s laws, or UK GDPR and together with the EU GDPR, GDPR. Despite Brexit, the EU and UK GDPR remain largely aligned.
Following the withdrawal of the United Kingdom from the European Union, or Brexit, the EU GDPR has been incorporated into United Kingdom’s laws, or UK GDPR, alongside the UK Data Protection Act 2018, and together with the EU GDPR, is referred to as GDPR. Despite Brexit, the EU and UK GDPR remain largely aligned.
If any of our product candidates receives marketing approval, the accompanying label may limit the approved use of our drug, which could limit sales of the product. 77 The process of obtaining marketing approvals, both in the United States and abroad, is expensive, may take many years, if approval is obtained at all, and can vary substantially based upon a variety of factors, including the type, complexity and novelty of the product candidates involved.
The process of obtaining marketing approvals, both in the United States and abroad, is expensive, may take many years, if approval is obtained at all, and can vary substantially based upon a variety of factors, including the type, complexity and novelty of the product candidates involved.
Our net loss was $109.9 million for the year ended December 31, 2022 and $80.8 million for the year ended December 31, 2021. As of December 31, 2022, we had an accumulated deficit of $412.3 million.
Our net loss was $97.3 million for the year ended December 31, 2023 and $109.9 million for the year ended December 31, 2022. As of December 31, 2023, we had an accumulated deficit of $509.7 million.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeAny future determination to declare dividends will be made at the discretion of our board of directors and will depend on our financial condition, operating results, capital requirements, general business conditions and other factors that our board of directors may deem relevant. Unregistered Sales of Equity Securities None. Item 6. R e served. Not applicable. 92
Biggest changeAny future determination to declare dividends will be made at the discretion of our board of directors and will depend on our financial condition, operating results, capital requirements, general business conditions and other factors that our board of directors may deem relevant. Unregistered Sales of Equity Securities None.
Holders of Our Common Stock As of March 2, 2023, there were approximately 17 holders of record of shares of our common stock. This number does not include stockholders for whom shares are held in “nominee” or “street” name. Dividends We have never declared or paid any cash dividends on our capital stock.
Holders of Our Common Stock As of February 20, 2024, there were approximately 14 holders of record of shares of our common stock. This number does not include stockholders for whom shares are held in “nominee” or “street” name. Dividends We have never declared or paid any cash dividends on our capital stock.

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe increase in general and administrative expenses was primarily attributable to the following: • $8.7 million in increased employee compensation costs, including a $3.0 million increase in stock-based compensation expense, primarily due to increased general and administrative headcount; • $1.2 million in increased facility-related costs, primarily associated with our lease agreement for additional office space in Cambridge, Massachusetts, which commenced in November 2021, as well as depreciation and other utility and maintenance costs; • $0.8 million in increased professional services, primarily due to increased use of consulting services; and • $0.5 million in increased other costs. 99 Restructuring Expenses Restructuring charges were $0.4 million for the year ended December 31, 2022, compared to zero for the year ended December 31, 2021.
Biggest changeThe decrease in general and administrative expenses was primarily attributable to the following: • $2.3 million in decreased professional services costs, primarily due to decreased consulting and insurance costs; • partially offset by $1.3 million of increased employee compensation costs, including a $1.4 million increase in stock-based compensation expense; • $0.3 million in increased facility-related costs, including increased costs associated with our leases as well as depreciation and other utility and maintenance costs; and • $0.6 million in increased other costs.
At each reporting date, we evaluate if the achievement of a performance-based milestone is probable based on the expected satisfaction of the performance conditions. 103 We determine the fair value of restricted stock awards and restricted stock units based on the estimated fair value of our common stock on the date of grant, less any applicable purchase price.
At each reporting date, we evaluate if the achievement of a performance-based milestone is probable based on the expected satisfaction of the performance conditions. We determine the fair value of restricted stock awards and restricted stock units based on the estimated fair value of our common stock on the date of grant, less any applicable purchase price.
A change in the outcome of any of these variables with respect to the development of any of our product candidates would significantly change the costs and timing associated with the development of that product candidate, and potentially other candidates. 97 Research and development activities account for a significant portion of our operating expenses.
A change in the outcome of any of these variables with respect to the development of any of our product candidates would significantly change the costs and timing associated with the development of that product candidate, and potentially other candidates. Research and development activities account for a significant portion of our operating expenses.
The net proceeds of the offering were $117.3 million, after deducting underwriting discounts and commissions and offering expenses. 93 We have incurred significant operating losses since our inception and we expect to continue to incur significant operating losses for the foreseeable future.
The net proceeds of the offering were $117.3 million, after deducting underwriting discounts and commissions and offering expenses. We have incurred significant operating losses since our inception and we expect to continue to incur significant operating losses for the foreseeable future.
See “—Liquidity and Capital Resources.” 94 Components of Results of Operations Revenue We have not generated any revenue from product sales and do not expect to generate revenue from the sale of products for several years, if at all.
See “—Liquidity and Capital Resources.” Components of Results of Operations Revenue We have not generated any revenue from product sales and do not expect to generate revenue from the sale of products for several years, if at all.
Net cash provided by financing activities during the year ended December 31, 2022 primarily consisted of net proceeds of $80.8 million from the completion of the public offering of our common stock in August 2022.
Net cash provided by financing activities during the year ended December 31, 2022 primarily consisted of net proceeds of $80.8 million from the August 2022 completion of the public offering of our common stock.
Since inception, our operations have focused on organizing and staffing our company, business planning, raising capital, establishing our intellectual property, building our discovery platform, including our proprietary compound library and product engine, identifying drug targets and potential product candidates, in-licensing assets, producing drug substance and drug product material for use in clinical trials and conducting preclinical studies and clinical trials.
Since inception, our operations have focused on organizing and staffing our company, business planning, raising capital, establishing our intellectual property, building our discovery platform, including our proprietary compound library and technologies, identifying drug targets and potential product candidates, in-licensing assets, producing drug substance and drug product material for use in clinical trials and conducting preclinical studies and clinical trials.
Pre-development candidate expenses, unallocated expenses and internal research and development expenses are classified separately. Losmapimod external expenses during the year ended December 31, 2022 include a $5.0 million milestone achieved under our right of reference and license agreement with GSK upon initiation of the REACH trial during the second quarter of 2022.
Pre-development candidate expenses, unallocated expenses and internal research and development expenses are classified separately. Losmapimod external expenses during the year ended December 31, 2022 includes a $5.0 million milestone achieved under our right of reference and license agreement with GSK upon initiation of the REACH trial during the second quarter of 2022.
We do not track our internal research and development expenses on a program-by-program basis as the resources are deployed across multiple projects. The following table summarizes our external research and development expenses by program following nomination as a development candidate for the years ended December 31, 2022 and 2021.
We do not track our internal research and development expenses on a program-by-program basis as the resources are deployed across multiple projects. The following table summarizes our external research and development expenses by program following nomination as a development candidate for the years ended December 31, 2023 and 2022.
On July 20, 2020, we entered into a collaboration and license agreement with MyoKardia, pursuant to which we granted to MyoKardia an exclusive worldwide license under certain intellectual property rights to research, develop, make, have made, use, have used, sell, have sold, offer for sale, have offered for sale, import, have imported, export, have exported, distribute, have distributed, market, have marketed, promote, have promoted, or otherwise exploit products directed against certain biological targets identified by us that are capable of modulating up to a certain number of genes of interest with relevance to certain genetically defined cardiomyopathies.
In July 2020, we entered into a collaboration and license agreement with MyoKardia, which we amended in April 2023, pursuant to which we granted to MyoKardia an exclusive worldwide license under certain intellectual property rights to research, develop, make, have made, use, have used, sell, have sold, offer for sale, have offered for sale, import, have imported, export, have exported, distribute, have distributed, market, have marketed, promote, have promoted, or otherwise exploit products directed against certain biological targets identified by us that are capable of modulating up to a certain number of genes of interest with relevance to certain genetically defined cardiomyopathies.
This is due to the numerous risks and uncertainties associated with developing our product candidates, including the uncertainty related to: • the timing and progress of preclinical and clinical development activities, including in light of the ongoing COVID-19 pandemic as well as our efforts to resolve the clinical hold on FTX-6058; • the number and scope of preclinical and clinical programs we decide to pursue; • our ability to raise additional funds necessary to complete clinical development of and commercialize our product candidates; • our ability to maintain our current research and development programs and to establish new ones; • our ability to establish new licensing or collaboration arrangements; • the progress of the development efforts of parties with whom we may enter into collaboration arrangements; • the successful initiation and completion of clinical trials with safety, tolerability and efficacy profiles that are satisfactory to the FDA or any comparable foreign regulatory authority; • the receipt and related terms of regulatory approvals from applicable regulatory authorities; • the availability of raw materials and active pharmaceutical ingredient, or API, for use in production of our product candidates; • our ability to establish and operate a manufacturing facility, or secure manufacturing supply through relationships with third parties; • our ability to consistently manufacture our product candidates in quantities sufficient for use in clinical trials; • our ability to obtain and maintain intellectual property protection and regulatory exclusivity, both in the United States and internationally; • our ability to maintain, enforce, defend and protect our rights in our intellectual property portfolio; • the commercialization of our product candidates, if and when approved; • our ability to obtain and maintain third-party coverage and adequate reimbursement for our product candidates, if approved; • the acceptance of our product candidates, if approved, by patients, the medical community and third-party payors; • competition with other products; and • a continued acceptable safety profile of our products following receipt of any regulatory approvals.
This is due to the numerous risks and uncertainties associated with developing our product candidates, including the uncertainty related to: • the timing and progress of preclinical and clinical development activities; • the number and scope of preclinical and clinical programs we decide to pursue; • our ability to raise additional funds necessary to complete clinical development of and commercialize our product candidates; • our ability to maintain our current research and development programs and to establish new ones; • our ability to establish new licensing or collaboration arrangements; • the progress of the development efforts of parties with whom we may enter into collaboration arrangements; • the successful initiation and completion of clinical trials with safety, tolerability and efficacy profiles that are satisfactory to the FDA or any comparable foreign regulatory authority; • the receipt and related terms of regulatory approvals from applicable regulatory authorities; • the availability of raw materials and active pharmaceutical ingredient, or API, for use in production of our product candidates; • our ability to establish and operate a manufacturing facility, or secure manufacturing supply through relationships with third parties; • our ability to consistently manufacture our product candidates in quantities sufficient for use in clinical trials; • our ability to obtain and maintain intellectual property protection and regulatory exclusivity, both in the United States and internationally; • our ability to maintain, enforce, defend and protect our rights in our intellectual property portfolio; • the commercialization of our product candidates, if and when approved; • our ability to obtain and maintain third-party coverage and adequate reimbursement for our product candidates, if approved; • the acceptance of our product candidates, if approved, by patients, the medical community and third-party payors; • competition with other products; and • a continued acceptable safety profile of our products following receipt of any regulatory approvals.
As of December 31, 2022 and 2021, we have recorded $0.9 million and $4.1 million, respectively, of deferred revenue associated with the MyoKardia collaboration agreement, which is classified as either current or noncurrent, net of current portion in our consolidated balance sheets based on the period over which the revenue is expected to be recognized.
As of December 31, 2022 we have recorded $0.9 million of deferred revenue associated with the MyoKardia collaboration agreement, which is classified as either current or noncurrent, net of current portion in our consolidated balance sheets based on the period over which the revenue is expected to be recognized.
We expect our expenses and operating losses will increase substantially over the next several years in connection with our ongoing activities, as we: • continue our clinical development of losmapimod and FTX-6058, including efforts to resolve the clinical hold on FTX-6058; • continue our ongoing preclinical studies; • advance clinical-stage product candidates into later stage trials; • pursue the discovery of drug targets for other genetically-defined rare diseases and the subsequent development of any resulting product candidates; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • scale up our manufacturing processes and capabilities, or arrange for a third party to do so on our behalf, to support our clinical trials of our product candidates and commercialization of any of our product candidates for which we obtain marketing approval; • establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain regulatory approval; • acquire or in-license products, product candidates, technologies and/or data referencing rights; • make any milestone payments to affiliates of GSK under our right of reference and license agreement with GSK upon the achievement of specified clinical or regulatory milestones; • maintain, expand, enforce, defend and protect our intellectual property; • hire additional clinical, quality control and scientific personnel; and • add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts and our operations as a public company.
We expect our expenses and operating losses will increase substantially over the next several years in connection with our ongoing activities, as we: • continue our clinical development of losmapimod and pociredir; • continue our ongoing preclinical studies; • advance clinical-stage product candidates into later stage trials such as REACH, the Phase 3 clinical trial of losmapimod for the treatment of FSHD; • pursue the discovery of drug targets for other genetically-defined rare diseases and the subsequent development of any resulting product candidates, including for Diamond Blackfan Anemia under our recent license agreement with CAMP4; • seek regulatory approvals for any product candidates that successfully complete clinical trials; • scale up our manufacturing processes and capabilities, or arrange for a third party to do so on our behalf, to support our clinical trials of our product candidates and commercialization of any of our product candidates for which we obtain marketing approval; • establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain regulatory approval; • acquire or in-license products, product candidates, technologies and/or data referencing rights, such as our recent agreement with CAMP4; • make any milestone payments to affiliates of GSK under our right of reference and license agreement with GSK upon the achievement of specified clinical or regulatory milestones, or to CAMP4 under our license agreement with CAMP4; • maintain, expand, enforce, defend and protect our intellectual property; • hire additional clinical, quality control and scientific personnel; and • add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts and our operations as a public company.
The agreement terminated effective October 1, 2022, following notification from Acceleron in June 2022 of its decision to terminate the agreement for convenience. For the years ended December 31, 2022 and 2021, we recognized $1.0 million and $9.6 million, respectively, of collaboration revenue under the Acceleron collaboration agreement.
The agreement terminated effective October 1, 2022, following notification from Acceleron in June 2022 of its decision to terminate the agreement for convenience. For the years ended December 31, 2023 and 2022, we recognized zero and $1.0 million, respectively of collaboration revenue under the Acceleron collaboration agreement.
Our ability to generate product revenue sufficient to achieve profitability, if ever, will depend heavily on the successful development and eventual commercialization of one or more of our product candidates. Our net losses were $109.9 million and $80.8 million for the years ended December 31, 2022 and 2021, respectively.
Our ability to generate product revenue sufficient to achieve profitability, if ever, will depend heavily on the successful development and eventual commercialization of one or more of our product candidates. Our net losses were $97.3 million and $109.9 million for the years ended December 31, 2023 and 2022, respectively.
If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations. As of December 31, 2022, we had $202.9 million in cash, cash equivalents, and marketable securities.
If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations. As of December 31, 2023, we had $236.2 million in cash, cash equivalents, and marketable securities.
Our funding requirements and timing and amount of our operating expenditures will depend largely on: • the progress, costs and results of our clinical trials of losmapimod and FTX-6058, including our efforts to resolve the clinical hold on FTX-6058; • the scope, progress, costs and results of discovery research, preclinical development, laboratory testing and clinical trials for our current product candidates in additional indications or for any future product candidates that we may pursue; • the impact of the ongoing COVID-19 pandemic on our business and operations; • the number of and development requirements for other product candidates that we pursue; • the costs, timing and outcome of regulatory review of our product candidates; • our ability to enter into contract manufacturing arrangements for supply of API and manufacture of our product candidates and the terms of such arrangements; • the success of our collaboration with MyoKardia; • our ability to establish and maintain additional strategic collaborations, licensing or other arrangements and the financial terms of such arrangements; • the payment or receipt of milestones, royalties and other collaboration-based revenues, if any; • the costs and timing of future commercialization activities, including product manufacturing, sales, marketing and distribution, for any of our product candidates for which we may receive marketing approval; • the amount and timing of revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights and defending any intellectual property-related claims; and • the extent to which we acquire or in-license other products, product candidates, technologies or data referencing rights.
Our funding requirements and timing and amount of our operating expenditures will depend largely on: • the progress, costs and results of our clinical trials of losmapimod and pociredir; • the scope, progress, costs and results of discovery research, preclinical development, laboratory testing and clinical trials for our current product candidates in additional indications or for any future product candidates that we may pursue, including under our recent license agreement with CAMP4; • the number of and development requirements for other product candidates that we pursue; • the costs, timing and outcome of regulatory review of our product candidates; • our ability to enter into contract manufacturing arrangements for supply of API and manufacture of our product candidates and the terms of such arrangements; • the success of our collaboration with MyoKardia; • our ability to establish and maintain additional strategic collaborations, licensing or other arrangements and the financial terms of such arrangements; • the payment or receipt of milestones, royalties and other collaboration-based revenues, if any; • the costs and timing of future commercialization activities, including product manufacturing, sales, marketing and distribution, for any of our product candidates for which we may receive marketing approval; • the amount and timing of revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval; • the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property and proprietary rights and defending any intellectual property-related claims; and • the extent to which we acquire or in-license other products, product candidates, technologies or data referencing rights.
Overview We are a clinical-stage biopharmaceutical company focused on improving the lives of patients with genetically defined rare diseases in areas of high unmet medical need. Our most advanced clinical product candidate, losmapimod, is being developed for the potential treatment of FSHD.
Overview We are a clinical-stage biopharmaceutical company focused on developing small molecules to improve the lives of patients with genetically defined rare diseases in areas of high unmet medical need. Our most advanced clinical-stage product candidate, losmapimod, is being developed for the potential treatment of FSHD.
The royalties are payable on a product-by-product basis during a specified royalty term, and may be reduced in specified circumstances. For the years ended December 31, 2022 and 2021 we recognized $5.3 million and $9.6 million, respectively, of collaboration revenue under the MyoKardia collaboration agreement.
The royalties are payable on a product-by-product basis during a specified royalty term, and may be reduced in specified circumstances. For the years ended December 31, 2023 and 2022 we recognized $2.8 million and $5.3 million, respectively, of collaboration revenue under the MyoKardia collaboration agreement.
We recognize compensation expense for awards with performance-based vesting conditions over the remaining service period using an accelerated attribution method when management determines that achievement of the performance condition is probable.
We have also granted certain stock-based awards with performance-based vesting conditions.We recognize compensation expense for awards with performance-based vesting conditions over the remaining service period using an accelerated attribution method when management determines that achievement of the performance condition is probable.
Net Cash Provided by (Used in) Investing Activities Net cash provided by investing activities was $12.4 million during the year ended December 31, 2022 compared to net cash used in investing activities of $129.7 million during the year ended December 31, 2021.
Net Cash (Used in) Provided by Investing Activities Net cash used in investing activities was $36.7 million during the year ended December 31, 2023 compared to net cash provided by investing activities of $12.4 million during the year ended December 31, 2022.
In addition to the variables described above, if and when any of our product candidates successfully complete development, we will incur substantial additional costs associated with regulatory filings, marketing approval, post-marketing requirements, maintaining our intellectual property rights, and regulatory protection, in addition to other commercial costs.
In addition to the variables described above, if and when any of our product candidates successfully complete development, we will incur substantial additional costs associated with regulatory filings, marketing approval, post-marketing requirements, maintaining our intellectual property rights, and regulatory protection, in addition to other commercial costs. We cannot reasonably estimate these costs at this time.
We cannot reasonably estimate these costs at this time. 101 Until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaboration arrangements, strategic alliances and marketing, distribution or licensing arrangements. We currently have no credit facility or committed sources of capital.
Until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaboration arrangements, strategic alliances and marketing, distribution or licensing arrangements. We currently have no credit facility or committed sources of capital.
We recognize revenue under each of the Acceleron and MyoKardia collaboration agreements based on our pattern of performance related to the respective identified performance obligation, which is the period over which we will perform research services under each of the agreements.
We recognize revenue under collaboration agreements based on our pattern of performance related to the respective identified performance obligation, which is the period over which we will perform research services under the respective agreement.
As of December 31, 2022, we had received $5.6 million of cost reimbursement payments and $2.5 million of milestone payments under the MyoKardia collaboration agreement.
As of December 31, 2023, we had received $7.2 million of cost reimbursement payments and $2.5 million of milestone payments under the MyoKardia collaboration agreement.
We recognize compensation expense for these awards over the requisite service period, which is generally the vesting period of the respective award. Generally, we issue awards with only service-based vesting conditions and record the expense for these awards using the straight-line method. We have also granted certain stock-based awards with performance-based vesting conditions.
We recognize compensation expense for these awards over the requisite service period, which is generally the vesting period of the respective award. Generally, we issue awards with only service-based vesting conditions and record the expense for these awards using the straight-line method.
As of December 31, 2022, we have funded our operations primarily with aggregate gross proceeds of $587.5 million from the sale of shares of our capital stock and from upfront payments received under our collaboration and license agreements. As of December 31, 2022, we had cash, cash equivalents, and marketable securities of $202.9 million.
As of December 31, 2023, we have funded our operations primarily with aggregate gross proceeds of $712.5 million from the sale of shares of our capital stock and from upfront payments received under our collaboration and license agreements. As of December 31, 2023, we had cash, cash equivalents, and marketable securities of $236.2 million.
We expect our research and development expenses to increase significantly in future periods as we continue to implement our business strategy, which includes advancing losmapimod for the treatment of FSHD, advancing FTX-6058 for the treatment of certain hemoglobinopathies, including SCD, if we are able to resolve the current clinical hold, expanding our research and development efforts, including hiring additional personnel to support our research and development efforts, and seeking regulatory approvals for our product candidates that successfully complete clinical trials.
We expect our research and development expenses to increase significantly in future periods as we continue to implement our business strategy, which includes advancing losmapimod for the treatment of FSHD, advancing pociredir for the treatment of SCD, expanding our research and development efforts, including hiring additional personnel to support our research and development efforts, and seeking regulatory approvals for our product candidates that successfully complete clinical trials.
As of December 31, 2022, we have recorded no deferred revenue associated with the Acceleron collaboration agreement.
As of December 31, 2023, we have recorded no deferred revenue associated with the MyoKardia collaboration agreement.
We expect that our revenue will fluctuate from quarter-to-quarter and year-to-year based upon our pattern of performance under the MyoKardia collaboration agreement and as a result of the timing, amount, and achievement of milestones and reimbursement of costs incurred under the MyoKardia collaboration agreement.
We expect that our revenue may fluctuate from quarter-to-quarter and year-to-year as a result of the timing, amount, and achievement of milestones under the MyoKardia collaboration agreement.
In January 2023, we announced Phase 1b data from our clinical trial of FTX-6058 in SCD. We have completed enrollment in the 6 mg and 2 mg dose cohorts, and we do not plan to enroll additional subjects in these cohorts.
We expect to report topline data from REACH in the fourth quarter of 2024. In January 2023, we announced interim data from our Phase 1b clinical trial of pociredir in SCD. We completed enrollment in the 6 mg and 2 mg dose cohorts, and we do not plan to enroll additional subjects in these cohorts.
We have developed a proprietary product engine, FulcrumSeek, that we employ to systematically identify and validate cellular drug targets that can potentially modulate gene expression to treat known root causes of genetically defined diseases.
In addition to product candidate development, we have developed discovery approach that we employ to systematically identify and validate cellular drug targets that can potentially modulate gene expression to treat known root causes of genetically defined rare diseases.
Although we commenced enrollment in the 12 mg dose cohort, on February 23, 2023, the FDA placed a full clinical hold on the IND for FTX-6058 for SCD.
Although we commenced enrollment in the 12 mg dose cohort, in February 2023 the FDA placed a full clinical hold on the IND application for pociredir for SCD, which was lifted in August 2023.
Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation on a relative standalone selling price basis, except for any variable consideration that meets the criteria to be allocated entirely to a single performance obligation or to a distinct service that forms part of a single performance obligation. 102 We recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied, either at a point in time or over time.
Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation on a relative standalone selling price basis, except for any variable consideration that meets the criteria to be allocated entirely to a single performance obligation or to a distinct service that forms part of a single performance obligation.
Our other clinical product candidate is FTX-6058, which is being developed for the potential treatment of certain hemoglobinopathies, including SCD. We initiated REACH, a randomized, double-blind, placebo-controlled, multi-national Phase 3 clinical trial of losmapimod in the second quarter of 2022 and plan to complete enrollment in the second half of 2023.
Our other clinical product candidate is pociredir, which is being developed for the potential treatment of SCD. We initiated REACH, a randomized, double-blind, placebo-controlled, multi-national Phase 3 clinical trial of losmapimod in the second quarter of 2022 and we completed enrollment during September 2023. The trial enrolled 260 patients.
As of December 31, 2022, we recorded unbilled accounts receivable of $0.2 million related to reimbursable research and development costs under the MyoKardia collaboration agreement for activities performed during the three months ended December 31, 2022.
As of December 31, 2023, we recorded unbilled accounts receivable of $0.5 million related to reimbursable research and development costs under the MyoKardia collaboration agreement for activities performed during the three months ended December 31, 2023. In the future, we may generate revenue from milestones and royalty payments under the MyoKardia collaboration agreement.
Cash Flows The following table provides information regarding our cash flows for the years ended December 31, 2022 and 2021: Year Ended December 31, (in thousands) 2022 2021 Net cash used in operating activities $ (97,050 ) $ (78,478 ) Net cash provided by (used in) investing activities 12,413 (129,669 ) Net cash provided by financing activities 84,323 186,507 Net decrease in cash, cash equivalents, and restricted cash $ (314 ) $ (21,640 ) Net Cash Used in Operating Activities Net cash used in operating activities was $97.1 million during the year ended December 31, 2022 compared to net cash used in operating activities of $78.5 million during the year ended December 31, 2021.
Cash Flows The following table provides information regarding our cash flows for the years ended December 31, 2023 and 2022: Year Ended December 31, (in thousands) 2023 2022 Net cash used in operating activities $ (90,965 ) $ (97,050 ) Net cash (used in) provided by investing activities (36,692 ) 12,413 Net cash provided by financing activities 118,122 84,323 Net decrease in cash, cash equivalents, and restricted cash $ (9,535 ) $ (314 ) Net Cash Used in Operating Activities Net cash used in operating activities was $91.0 million during the year ended December 31, 2023 compared to net cash used in operating activities of $97.1 million during the year ended December 31, 2022.
For the years ended December 31, 2022 and 2021, we recognized $1.0 million and $9.6 million, respectively, of collaboration revenue under the Acceleron collaboration agreement and $5.3 million and $9.6 million of collaboration revenue, respectively, under the MyoKardia collaboration agreement.
For the years ended December 31, 2023 and 2022, we recognized zero and $1.0 million, respectively, of collaboration revenue under the Acceleron collaboration agreement, which terminated in October 2022, and $2.8 million and $5.3 million of collaboration revenue, respectively, under the MyoKardia collaboration agreement.
Net cash provided by financing activities during the year ended December 31, 2021 primarily consisted of net proceeds of $182.9 million from the completion of the public offerings of our common stock in January 2021 and August 2021.
Net cash provided by financing activities during the year ended December 31, 2023 primarily consisted of net proceeds of $117.3 million from the January 2023 public offering of our common stock.
Year Ended December 31, (in thousands) 2022 2021 Losmapimod external expenses $ 26,260 $ 19,128 FTX-6058 external expenses 15,133 14,041 Pre-development candidate expenses and unallocated expenses 14,964 16,100 Internal research and development expenses 20,425 20,432 Total research and development expenses $ 76,782 $ 69,701 96 The successful development of our product candidates is highly uncertain.
Year Ended December 31, (in thousands) 2023 2022 Losmapimod external expenses $ 29,069 $ 26,260 Pociredir external expenses 7,442 15,133 Pre-development candidate expenses and unallocated expenses 14,536 14,964 Internal research and development expenses 20,754 20,425 Total research and development expenses $ 71,801 $ 76,782 The successful development of our product candidates is highly uncertain.
As of December 31, 2022, we had an accumulated deficit of $412.3 million.
As of December 31, 2023, we had an accumulated deficit of $509.7 million.
The increase in net cash provided by investing activities of $142.0 million was primarily due to net maturities of marketable securities during the year ended December 31, 2022, as compared to net purchases of marketable securities during the year ended December 31, 2021. 100 Net Cash Provided by Financing Activities Net cash provided by financing activities was $84.3 million during the year ended December 31, 2022 compared to net cash provided by financing activities of $186.5 million during the year ended December 31, 2021.
The increase in net cash used in investing activities of $49.1 million was primarily due to net purchases of marketable securities during the year ended December 31, 2023, as compared to net maturities of marketable securities during the year ended December 31, 2022.
If the performance obligation is satisfied over time, we recognize revenue based on the use of either an output or input method.
We recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied, either at a point in time or over time. If the performance obligation is satisfied over time, we recognize revenue based on the use of either an output or input method.
Research and Development Expenses The following table summarizes our research and development expenses for the years ended December 31, 2022 and 2021: Year Ended December 31, Change (in thousands) 2022 2021 $ External research and development $ 44,944 $ 36,934 $ 8,010 Employee compensation 20,425 20,432 (7 ) Laboratory supplies 4,242 5,115 (873 ) Facility costs 5,593 5,552 41 Other 1,578 1,668 (90 ) Total research and development expenses $ 76,782 $ 69,701 $ 7,081 Research and development expense increased by $7.1 million from $69.7 million for the year ended December 31, 2021 to $76.8 million for the year ended December 31, 2022.
Research and Development Expenses The following table summarizes our research and development expenses for the years ended December 31, 2023 and 2022: Year Ended December 31, Change (in thousands) 2023 2022 $ External research and development $ 41,179 $ 44,944 $ (3,765 ) Employee compensation 20,754 20,425 329 Laboratory supplies 3,501 4,242 (741 ) Facility costs 4,834 5,593 (759 ) Other 1,533 1,578 (45 ) Total research and development expenses $ 71,801 $ 76,782 $ (4,981 ) Research and development expense decreased by $5.0 million from $76.8 million for the year ended December 31, 2022 to $71.8 million for the year ended December 31, 2023.
General and Administrative Expenses The following table summarizes our general and administrative expenses for the years ended December 31, 2022 and 2021: Year Ended December 31, Change (in thousands) 2022 2021 $ Employee compensation $ 23,488 $ 14,801 $ 8,687 Professional services 13,278 12,488 790 Facility costs 2,206 960 1,246 Other 2,722 2,267 455 Total general and administrative expenses $ 41,694 $ 30,516 $ 11,178 General and administrative expenses increased by $11.2 million from $30.5 million for the year ended December 31, 2021 to $41.7 million for the year ended December 31, 2022.
General and Administrative Expenses The following table summarizes our general and administrative expenses for the years ended December 31, 2023 and 2022: Year Ended December 31, Change (in thousands) 2023 2022 $ Employee compensation $ 24,809 $ 23,488 $ 1,321 Professional services 11,023 13,278 (2,255 ) Facility costs 2,516 2,206 310 Other 3,320 2,722 598 Total general and administrative expenses $ 41,668 $ 41,694 $ (26 ) General and administrative expenses decreased by less than $0.1 million from $41.7 million for the year ended December 31, 2022 to $41.7 million for the year ended December 31, 2023.
Results of Operations Comparison of the Years Ended December 31, 2022 and 2021 The following summarizes our results of operations for the years ended December 31, 2022 and 2021, along with the changes in those items in dollars: Year Ended December 31, Change (in thousands) 2022 2021 $ Collaboration revenue $ 6,342 $ 19,163 $ (12,821 ) Operating expenses: Research and development 76,782 69,701 7,081 General and administrative 41,694 30,516 11,178 Restructuring expenses 427 — 427 Total operating expenses 118,903 100,217 18,686 Loss from operations (112,561 ) (81,054 ) (31,507 ) Other income, net 2,690 207 2,483 Net loss $ (109,871 ) $ (80,847 ) $ (29,024 ) 98 Collaboration Revenue Collaboration revenue decreased by $12.8 million from $19.2 million for the year ended December 31, 2021 to $6.3 million for the year ended December 31, 2022.
Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 The following summarizes our results of operations for the years ended December 31, 2023 and 2022, along with the changes in those items in dollars: Year Ended December 31, Change (in thousands) 2023 2022 $ Collaboration revenue $ 2,805 $ 6,342 $ (3,537 ) Operating expenses: Research and development 71,801 76,782 (4,981 ) General and administrative 41,668 41,694 (26 ) Restructuring expenses — 427 (427 ) Total operating expenses 113,469 118,903 (5,434 ) Loss from operations (110,664 ) (112,561 ) 1,897 Other income, net 13,329 2,690 10,639 Net loss $ (97,335 ) $ (109,871 ) $ 12,536 Collaboration Revenue Collaboration revenue decreased by $3.5 million from $6.3 million for the year ended December 31, 2022 to $2.8 million for the year ended December 31, 2023.
Based on our current operating plan, we believe that our existing cash, cash equivalents, and marketable securities as of December 31, 2022, together with the net proceeds from the sale of our shares of common stock in a public offering in January 2023, will enable us to fund our operating expenses and capital expenditure requirements into mid-2025.
As a result, we expect to incur substantial operating losses and negative operating cash flows for the foreseeable future. Based on our current operating plan, we believe that our existing cash, cash equivalents, and marketable securities as of December 31, 2023 will enable us to fund our operating expenses and capital expenditure requirements into 2026.
The net proceeds of the offering were $80.8 million, after deducting underwriting discounts and commissions and offering expenses. In January 2023, we issued and sold 9,615,384 shares of our common stock in a public offering at a public offering price of $13.00 per share, less underwriting discounts and commissions.
To date, we have funded our operations primarily from the sale of shares of our capital stock and from upfront payments received under our collaboration and license agreements. In January 2023, we issued and sold 9,615,384 shares of our common stock in a public offering at a public offering price of $13.00 per share, less underwriting discounts and commissions.
We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect.
We believe that our existing cash, cash equivalents, and marketable securities as of December 31, 2023 will enable us to fund our operating expenses and capital expenditure requirements into 2026. We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect.
Other Income, Net Other income, net increased by $2.5 million from $0.2 million for the year ended December 31, 2021 to $2.7 million for the year ended December 31, 2022. The increase in other income, net was primarily attributable to an increased rate of return.
Other Income, Net Other income, net increased by $10.6 million from $2.7 million for the year ended December 31, 2022 to $13.3 million for the year ended December 31, 2023.
The increase in research and development expense was primarily attributable to the following: • $8.0 million in increased external research and development costs, primarily to support the advancement of our lead programs, including a $5.0 million milestone achieved during the second quarter of 2022 under the right of reference and license agreement with GSK upon the initiation of REACH during the second quarter of 2022, offset by a $0.9 million decrease in laboratory supplies costs.
The decrease in research and development expense was primarily attributable to the following: • $3.8 million of decreased external research and development costs, primarily associated with decreased costs for pociredir as a result of the clinical hold from February 2023 to August 2023, and achievement of a $5.0 million milestone due to GSK upon initiation of REACH in the second quarter of 2022, partially offset by increased costs associated with the advancement of REACH as we completed enrollment in September 2023; • $0.8 million of decreased facilities costs; • $0.7 million of decreased laboratory costs; • partially offset by $0.3 million of increased employee compensation costs.
Other Income, Net Other income, net consists primarily of interest income related to our investments in cash equivalents and marketable securities.
The increase in other income, net was primarily attributable to an increased rate of return on our cash, cash equivalents, and marketable securities and an increase in our average cash, cash equivalents, and marketable securities balance.
The increase in net cash used in operating activities of $18.6 million was primarily due to increased external research and development costs as we continue to advance our lead programs, increased employee compensation costs, and increased general and administrative costs to support the growth of our organization.
The decrease in net cash used in operating activities of $6.1 million was primarily due to a decrease in net loss, including as a result of decreased external research and development costs as a result of the clinical hold for pociredir, which was lifted in August 2023, and increased interest income.
We then apply computational biology and analytics to identify targets with specificity and selectivity accompanied by a comprehensive data set that significantly accelerates development. This approach led to the identification of both losmapimod for FSHD and FTX-6058 for hemoglobinopathies, as well as a robust discovery pipeline.
Our discovery approach led to the identification of both losmapimod for FSHD and pociredir for SCD, as well as a robust discovery pipeline.
Removed
We have suspended enrollment and dosing in the Phase 1b trial of FTX-6058, withdrew our separate IND for FTX-6058 for beta thalassemia and intend to work diligently with FDA to resolve the hold as soon as possible.
Added
The Phase 1b clinical trial is being re-initiated at the 12 mg once daily dose level, with that cohort expected to enroll approximately 10 patients, and will be followed by an additional cohort of approximately 10 patients at the 20 mg once daily dose level.
Removed
Our product engine integrates patient-derived tissue- and disease-relevant cell models that we interrogate using our pharmacologically diverse and highly annotated small-molecule compound library and customized CRISPR and RNAi libraries. These screens generate tens of millions of data points and high-content imaging.
Added
Following the clinical hold, we amended the protocol to revise the inclusion and exclusion criteria for the Phase 1b clinical trial to target patients with higher disease severity.
Removed
To date, we have funded our operations primarily from the sale of shares of our capital stock and from upfront payments received under our collaboration and license agreements.
Added
With our priorities focused on the development and potential commercialization of our two clinical-stage assets, losmapimod and pociredir, and ongoing work on our preclinical programs in hematology and muscle diseases, we are realigning our strategy and resources accordingly and will be winding down certain exploratory activities from our discovery efforts.
Removed
In August 2022, we issued and sold 11,029,410 shares of our common stock in a public offering at a public offering price of $7.82 per share, which includes 1,438,618 shares issued upon the exercise in full by the underwriters of their option to purchase additional shares at the public offering price, less underwriting discounts and commissions.
Added
We expect that our general and administrative expenses will increase in the future to support continued research and development activities and planned commercialization activities, including establishing a sales, marketing and distribution infrastructure to commercialize any medicines for which we may obtain marketing approval.
Removed
We believe that our existing cash, cash equivalents, and marketable securities, together with the net proceeds from the sale of our shares of common stock in the public offering in January 2023, will enable us to fund our operating expenses and capital expenditure requirements into mid-2025.
Added
These increases will likely include increased costs related to the hiring of additional personnel, legal, audit, filing fees, and general compliance and consulting expenses, among other expenses. Other Income, Net Other income, net consists primarily of interest income related to our investments in cash equivalents and marketable securities.
Removed
As of December 31, 2021, we have recorded $0.6 million of deferred revenue associated with the Acceleron collaboration agreement, which is classified as either current or net of current portion in our consolidated balance sheets based on the period over which the revenue was expected to be recognized.
Added
Net Cash Provided by Financing Activities Net cash provided by financing activities was $118.1 million during the year ended December 31, 2023 compared to net cash provided by financing activities of $84.3 million during the year ended December 31, 2022.
Removed
As of December 31, 2022, we had received $4.9 million of cost reimbursement payments and $2.0 million of milestone payments under the Acceleron collaboration agreement. As of December 31, 2022, we recorded no unbilled accounts receivable related to reimbursable research and development costs under the Acceleron collaboration agreement.
Removed
In the future, we will recognize additional revenue associated with the $10.0 million upfront payment and the $2.5 million preclinical milestone achieved in December 2021 as we satisfy our performance obligation, and from reimbursement of costs incurred under the MyoKardia collaboration agreement.
Removed
In the future, we may also generate additional revenue from 95 milestones and royalty payments under the MyoKardia collaboration agreement.
Removed
We expect our general and administrative expenses will increase for the foreseeable future to support our expanded infrastructure and increased costs of expanding our operations and operating as a public company.
Removed
These increases will likely include increased expenses related to accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with exchange listing and SEC requirements, director and officer insurance premiums, and investor relations costs associated with operating as a public company.
Removed
Restructuring Expenses In August 2022, we announced the implementation of a strategic plan to realign internal investments and operations to prioritize our two clinical programs. In connection with this decision, we announced a workforce reduction of 25% of our planned headcount, which was completed in August 2022. Restructuring expenses consist of severance and other employee-related costs.
Removed
In August 2022, we announced the implementation of a strategic plan to realign internal investments and operations to prioritize our two clinical programs. In connection with this decision, we announced a workforce reduction of 25% of our planned headcount, which was completed in August 2022.
Removed
In August 2022, we completed a public offering of our common stock and issued and sold 11,029,410 shares of common stock at a public offering price of $7.82 per share, resulting in net proceeds of $80.8 million after deducting underwriting discounts and commissions and offering expenses.
Removed
As a result, we expect to incur substantial operating losses and negative operating cash flows for the foreseeable future.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeInflation generally affects us by increasing our cost of labor and clinical trial costs. We do not believe that inflation had a material effect on our business, financial condition or results of operations during the years ended December 31, 2022 and 2021.
Biggest changeInflation generally affects us by increasing our cost of labor and clinical trial costs. We do not believe that inflation had a material effect on our business, financial condition or results of operations during the years ended December 31, 2023 and 2022.
Interest income 104 is sensitive to changes in the general level of interest rates; however, due to the nature of these investments, an immediate 10% change in interest rates would not have a material effect on the fair market value of our investment portfolio. We are also exposed to market risk related to changes in foreign currency exchange rates.
Interest income is sensitive to changes in the general level of interest rates; however, due to the nature of these investments, an immediate 10% change in interest rates would not have a material effect on the fair market value of our investment portfolio. We are also exposed to market risk related to changes in foreign currency exchange rates.
We contract with vendors that are located outside of the United States and certain invoices are denominated in foreign currencies. We are subject to fluctuations in foreign currency rates in connection with these arrangements. We do not currently hedge our foreign currency exchange rate risk. As of December 31, 2022, we had minimal or no liabilities denominated in foreign currencies.
We contract with vendors that are located outside of the United States and certain invoices are denominated in foreign currencies. We are subject to fluctuations in foreign currency rates in connection with these arrangements. We do not currently hedge our foreign currency exchange rate risk. As of December 31, 2023, we had minimal or no liabilities denominated in foreign currencies.
Treasury securities and our investments are in short-term marketable securities, such as corporate bonds and commercial paper. As of December 31, 2022, we had cash, cash equivalents, and marketable securities of $202.9 million.
Treasury securities and our investments are in short-term marketable securities, such as corporate bonds and commercial paper. As of December 31, 2023, we had cash, cash equivalents, and marketable securities of $236.2 million.

Other FULC 10-K year-over-year comparisons