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

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

+525 added−457 removedSource: 10-K (2024-03-26) vs 10-K (2023-03-23)

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

525 paragraphs added · 457 removed · 346 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

110 edited+36 added−41 removed244 unchanged
Biggest changeAdditionally, new or advanced technologies developed by our competitors may render our current or future product candidates uneconomical or obsolete, and we may not be successful in marketing our product candidates against competitors. 16 Table of Contents Strategic Transactions; Collaboration and Licensing Arrangements In connection with our business development activities, we enter into collaborative and licensing arrangement with third parties, to use our licensed SEE-Tx® computational platform technology to discover novel allosteric sites on misfolded proteins and identify proprietary small molecules that bind these sites, potentially restoring protein folding and treating disease.
Biggest changeStrategic Transactions; Collaboration and Licensing Arrangements In connection with our business development activities, we enter into collaborative and licensing arrangement with third parties to use our Magellan™ drug discovery platform to discover novel allosteric sites on proteins and identify proprietary small molecules that bind these sites to disrupt or restore protein function as may be needed to treat a particular disease.
Advantages of Targeting Allosteric Binding Sites We focus on allosteric binding site, which offer a number of advantages compared to targeting the active binding site of a protein, including the ability to regulate proteins implicated in disease through several different mechanisms of action covering both functional and conformational effects, improved specificity of small molecules because binding to an allosteric binding site is non-competitive with the natural ligand that binds to the active binding site, and the ability to identify small molecules with more favorable drug-like properties.
Advantages of Targeting Allosteric Binding Sites We focus on allosteric binding sites, which offer a number of advantages compared to targeting the active binding site of a protein, including the ability to regulate proteins implicated in disease through several different mechanisms of action covering both functional and conformational effects, improved specificity of small molecules because binding to an allosteric binding site is non-competitive with the natural ligand that binds to the active binding site, and the ability to identify small molecules with more favorable drug-like properties.
The process required by the FDA before our product candidates are approved as drugs for therapeutic indications and may be marketed in the U.S. generally involves the following: ● completion of extensive preclinical studies in accordance with applicable regulations, including studies conducted in accordance with good laboratory practice, or GLP, requirements; ● submission to the FDA of an IND application, which must become effective before clinical trials may begin; ● approval by an institutional review board, or IRB, or independent ethics committee at each clinical trial site before each trial may be initiated; ● performance of adequate and well-controlled clinical trials in accordance with applicable IND regulations, good clinical practice, or GCP, requirements and other clinical trial-related regulations to establish the safety and efficacy of the investigational product for each proposed indication; ● submission to the FDA of an NDA; ● a determination by the FDA within 60 days of its receipt of an NDA, to accept the filing for review; ● satisfactory completion of one or more FDA pre-approval inspections of the manufacturing facility or facilities where the drug will be produced to assess compliance with cGMP requirements to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity; ● potential FDA audit of the clinical trial sites that generated the data in support of the NDA; ● payment of user fees for FDA review of the NDA; and 19 Table of Contents ● FDA review and approval of the NDA, including consideration of the views of any FDA advisory committee, prior to any commercial marketing or sale of the drug in the U.S ​ Preclinical Studies and Clinical Trials for Drugs Before testing any drug in humans, the product candidate must undergo rigorous preclinical testing.
The process required by the FDA before our product candidates are approved as drugs for therapeutic indications and may be marketed in the U.S. generally involves the following: ● completion of extensive non-clinical studies in accordance with applicable regulations, including studies conducted in accordance with good laboratory practice, or GLP, requirements; ● submission to the FDA of an IND application, which must become effective before clinical trials may begin; ● approval by an institutional review board, or IRB, or independent ethics committee at each clinical trial site before each trial may be initiated; ● performance of adequate and well-controlled clinical trials in accordance with applicable IND regulations, good clinical practice, or GCP, requirements and other clinical trial-related regulations to establish the safety and efficacy of the investigational product for each proposed indication; ● submission to the FDA of an NDA; 17 Table of Contents ● a determination by the FDA within 60 days of its receipt of an NDA, to accept the filing for review; ● satisfactory completion of one or more FDA pre-approval inspections of the manufacturing facility or facilities where the drug will be produced to assess compliance with cGMP requirements to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity; ● potential FDA audit of the clinical trial sites that generated the data in support of the NDA; ● payment of user fees for FDA review of the NDA; and ● FDA review and approval of the NDA, including consideration of the views of any FDA advisory committee, prior to any commercial marketing or sale of the drug in the U.S ​ Preclinical Studies and Clinical Trials for Drugs Before testing any drug in humans, the product candidate must undergo rigorous preclinical testing.
Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the product candidate and finalize a process for manufacturing the drug product in commercial quantities in accordance with cGMP requirements.
Concurrent with clinical trials, companies usually complete additional laboratory and animal studies and must also develop additional information about the chemistry and physical characteristics of the product candidate and finalize a process for manufacturing the drug product in commercial quantities in accordance with cGMP requirements.
However, it is currently unclear to what extent the UK will seek to align its regulations with the EU following entry into application of the Clinical Trials Regulation on January 31, 2022. ​ 32 Table of Contents U.S.
However, it is currently unclear to what extent the UK will seek to align its regulations with the EU following entry into application of the Clinical Trials Regulation on January 31, 2022. ​ 31 Table of Contents U.S.
These studies are typically designed to test the safety, dosage tolerance, absorption, metabolism and distribution of the investigational product in humans, excretion the side effects associated with increasing doses, and, if possible, to gain early evidence of effectiveness. ​ ● Phase 2 —Phase 2 clinical trials typically involve administration of the investigational product to a limited patient population with a specified disease or condition to evaluate the preliminary efficacy, optimal dosages and dosing schedule and to identify possible adverse side effects and safety risks. ​ ● Phase 3 —Phase 3 clinical trials typically involve administration of the investigational product to an expanded patient population to further evaluate dosage, to provide statistically significant evidence of clinical efficacy and to further test for safety, generally at multiple geographically dispersed clinical trial sites.
These studies are typically designed to test the safety, dosage tolerance, absorption, metabolism and distribution of the investigational product in humans, excretion the side effects associated with increasing doses, and, if possible, to gain early evidence of effectiveness. 18 Table of Contents ​ ● Phase 2 —Phase 2 clinical trials typically involve administration of the investigational product to a limited patient population with a specified disease or condition to evaluate the preliminary efficacy, optimal dosages and dosing schedule and to identify possible adverse side effects and safety risks. ​ ● Phase 3 —Phase 3 clinical trials typically involve administration of the investigational product to an expanded patient population to further evaluate dosage, to provide statistically significant evidence of clinical efficacy and to further test for safety, generally at multiple geographically dispersed clinical trial sites.
Even if the FDA approves a product, depending on the specific risk(s) to be addressed it may limit the approved indications for use of the product, require that contraindications, warnings or precautions be included in the product labeling, require that post-approval studies, including Phase 4 clinical trials, be conducted to further assess a drug’s safety after approval, require testing and surveillance programs to monitor the product after commercialization or impose other conditions, including distribution and use restrictions or other risk management mechanisms under a REMS, which can materially affect the potential market and profitability of the product.
Even if the FDA approves a product, depending on the specific risk(s) to be addressed it may limit the approved indications for use of the product, require that contraindications, warnings or precautions be included in the product labeling, require that post-approval studies, including Phase 4 clinical trials, be conducted to further assess a 20 Table of Contents drug’s safety after approval, require testing and surveillance programs to monitor the product after commercialization or impose other conditions, including distribution and use restrictions or other risk management mechanisms under a REMS, which can materially affect the potential market and profitability of the product.
We may also be subject to federal transparency laws, including the federal Physician Payment Sunshine Act, which was part of the ACA and requires manufacturers of certain drugs and biologics, among others, to track and disclose payments and other transfers of value they make to U.S. physicians (defined to include doctors, dentists, optometrists, podiatrists, and chiropractors), other healthcare professionals (such as physician assistants and nurse practitioners), and teaching hospitals, as well as ownership and investment interests in the manufacturer held by such physicians and their immediate family members.
We may also be subject to federal transparency laws, including the federal Physician Payment Sunshine Act, which was part of the ACA and requires manufacturers of certain drugs and biologics, among others, to track and disclose payments and other transfers of value they make to U.S. physicians (defined to include doctors, dentists, optometrists, podiatrists, and chiropractors), other healthcare professionals (such as physician assistants and nurse practitioners), and teaching hospitals, as well as ownership and investment interests in the manufacturer held by such 25 Table of Contents physicians and their immediate family members.
Thus far we have identified allosteric binding sites and run virtual screens to identify virtual hits which are being characterized further in biochemical and cell-based assays. Competition The biotechnology and pharmaceutical industries are characterized by the rapid evolution of technologies and understanding of disease etiology, intense competition, and a strong emphasis on intellectual property.
Thus far we have identified allosteric binding sites and run virtual screens to identify virtual hits which have been characterized further in biochemical and cell-based assays. Competition The biotechnology and pharmaceutical industries are characterized by the rapid evolution of technologies and understanding of disease etiology, intense competition, and a strong emphasis on intellectual property.
A harmonized procedure for the assessment of applications for clinical trials has been introduced and is divided into two parts. Part I assessment is led by the competent authorities of a reference Member State selected by the trial sponsor and relates to clinical trial aspects that are considered to be scientifically harmonized across EU 31 Table of Contents Member States.
A harmonized procedure for the assessment of applications for clinical trials has been introduced and is divided into two parts. Part I assessment is led by the competent authorities of a reference Member State selected by the trial sponsor and relates to clinical trial aspects that are considered to be scientifically harmonized across EU 30 Table of Contents Member States.
Allosteric drugs also may provide a new foundation for combining oncolytic agents, to achieve important additive and synergistic effects, and to prevent or overcome drug-resistance to traditional orthosteric anti-cancer agent. ​ Target Selection Strategy ​ Targets have been selected based on the potential mechanism of action (with an initial focus on allosteric inhibition), unmet medical needs such as immune resistance, metastatic resistance, non satisfactory response to current standard of care, level of innovation and availability of preclinical tools. ​ Our Oncology Programs ​ We have two active oncology projects underway in which we are identifying STARs that are designed to destabilize target proteins by binding to allosteric sites on the proteins and rendering them inactive.
Allosteric drugs also may provide a new foundation for combining oncolytic agents, to achieve important additive and synergistic effects, and to prevent or overcome drug-resistance to traditional orthosteric anti-cancer agent. ​ Targets have been selected based on the potential mechanism of action (with an initial focus on allosteric inhibition), unmet medical needs such as immune resistance, metastatic resistance, non satisfactory response to current standard of care, level of innovation and availability of preclinical tools. ​ We have two active oncology projects underway in which we are identifying STARs that are designed to destabilize target proteins by binding to allosteric sites on the proteins and rendering them inactive.
Other Regulatory Matters Manufacturing, sales, promotion and other activities of product candidates following product approval, where applicable, or commercialization are also subject to regulation by numerous regulatory authorities in the U.S. in addition to the FDA, which may include the Centers for Medicare & Medicaid Services, or CMS, other divisions of 24 Table of Contents the Department of Health and Human Services, the Department of Justice, the Drug Enforcement Administration, the Consumer Product Safety Commission, the Federal Trade Commission, the Occupational Safety & Health Administration, the Environmental Protection Agency and state and local governments and governmental agencies.
Other Regulatory Matters Manufacturing, sales, promotion and other activities of product candidates following product approval, where applicable, or commercialization are also subject to regulation by numerous regulatory authorities in the U.S. in addition to the FDA, which may include the Centers for Medicare & Medicaid Services, or CMS, other divisions of the Department of Health and Human Services, the Department of Justice, the Drug Enforcement Administration, the Consumer Product Safety Commission, the Federal Trade Commission, the Occupational Safety & Health Administration, the Environmental Protection Agency and state and local governments and governmental agencies.
The holder of an MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance who is responsible for oversight of that 30 Table of Contents system. Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports, or PSURs.
The holder of an MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance who is responsible for oversight of that 29 Table of Contents system. Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports, or PSURs.
The applicant must submit a Marketing Authorization Application, or MAA, either under a centralized procedure administered by the EMA or one of the procedures administered by competent authorities in the EEA countries 28 Table of Contents (decentralized procedure, national procedure or mutual recognition procedure). An MA may be granted only to an applicant established in the EEA.
The applicant must submit a Marketing Authorization Application, or MAA, either under a centralized procedure administered by the EMA or one of the procedures administered by competent authorities in the EEA countries 27 Table of Contents (decentralized procedure, national procedure or mutual recognition procedure). An MA may be granted only to an applicant established in the EEA.
There are also a number of companies with alpha-synuclein specific approaches ranging from all stages of clinical development but these are distinct from us as they only aim to deplete a specific substrate rather than affecting the root cause of the disease at the start of the disease cascade.
There are also a number of companies with alpha-synuclein specific approaches ranging from all stages of clinical development but these are distinct from us as they only aim to deplete a specific protein rather than affecting the root cause of the disease at the start of the disease cascade.
Given these limitations on current therapies and novel therapeutics approaches, we believe patients would benefit from mall molecules acting as structurally targeted allosteric regulators that offer a new therapeutic approach both on their own and, potentially, in combination with existing therapies.
Given these limitations on current therapies and novel therapeutics approaches, we believe patients would benefit from small molecules acting as structurally targeted allosteric regulators that offer a new therapeutic approach both on their own and, potentially, in combination with existing therapies.
Allosteric Binding Site Identification Using the three-dimensional structure of proteins that have been experimentally derived or generated or predictive protein structures from AI-powered databases such as Alphafold, our SEE-Tx® platform applies various computational methods and proprietary algorithms to identify and map previously uncharacterized clusters of binding hotspots on the protein surface where a small molecule can potentially bind.
Allosteric Binding Site Identification Using the three-dimensional structure of proteins that have been experimentally derived or generated or predictive protein structures from AI-powered databases such as Alphafold, our Magellan™ platform applies various computational methods and proprietary algorithms to identify and map previously uncharacterized clusters of binding hotspots on the protein surface where a small molecule can potentially bind.
The graphic below provides an overview of the different mechanism of action available through allosteric binding sites. ​ Enzyme Misfolding and Disease Proteins are large biomolecules that have a vast array of functions in different cell types in the body.
The graphic below provides an overview of the different mechanisms of action available through allosteric binding sites. ​ Enzyme Misfolding and Disease Proteins are large biomolecules that have a vast array of functions in different cell types in the body.
As consideration for the license grant from Minoryx, we have agreed to pay Minoryx royalties on a product-by-product basis based on the licensed IP used by us, ranging from a high single digit to low single digit percentage of net revenues of products during the royalty term commencing on the effective date of the Minoryx License Agreement and continuing until the 10th anniversary of the first product commercialization.
As consideration for the license grant from Minoryx, we have agreed to pay Minoryx royalties on a product-by-product basis based on the licensed IP used by us, ranging from a high single digit to low single digit percentage 15 Table of Contents of net revenues of products during the royalty term commencing on the effective date of the Minoryx License Agreement and continuing until the 10th anniversary of the first product commercialization.
Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information, requirements for post-market studies or clinical trials to assess new safety risks, or imposition of distribution or other restrictions under a REMS.
Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information, requirements for post-market studies or clinical 22 Table of Contents trials to assess new safety risks, or imposition of distribution or other restrictions under a REMS.
Oncology Allosteric Regulators in Oncology ​ Allosteric regulators are molecules able to modify the activity of a protein binding to a site topographically distinct from the site of the protein, called the active site, in which the activity characterizing the protein is carried out and in oncology usually involves the binding of receptors. ​ 15 Table of Contents Targeting allosteric sites may provide greater specificity and selectivity of activity and allow for a better efficacy and safety profile.
Allosteric Regulators in Oncology ​ Allosteric regulators are molecules able to modify the activity of a protein binding to a site topographically distinct from the site of the protein, called the active site, in which the activity characterizing the protein is carried out and in oncology usually involves the binding of receptors. ​ Targeting allosteric sites may provide greater specificity and selectivity of activity and allow for a better efficacy and safety profile.
Further, every small molecule hit identified by our platform is experimentally tested based on a two-part molecular hypothesis to confirm that (1) the compound has a positive effect on the relevant biomarkers implicated in the disease and (2) binding to the allosteric binding site identified with the SEE-Tx® platform has the intended effect on protein function.
Further, every small molecule hit identified by our platform is experimentally tested based on a two-part molecular hypothesis to confirm that (1) the compound has a positive effect on the relevant biomarkers implicated in the disease and (2) binding to the allosteric binding site identified with the Magellan™ platform has the intended effect on protein function.
Our success will also depend in part on not infringing upon the proprietary rights of third parties. It is uncertain whether the issuance of any third-party patent would require us to alter our development or commercial 18 Table of Contents strategies, or our drugs or processes, obtain licenses or cease certain activities.
Our success will also depend in part on not infringing upon the proprietary rights of third parties. It is uncertain whether the issuance of any third-party patent would require us to alter our development or commercial strategies, or our drugs or processes, obtain licenses or cease certain activities.
We believe that our SEE-Tx® platform, our scientific capabilities, know-how and experience provide us with competitive advantages. However, we expect substantial competition from multiple sources, including major pharmaceutical, specialty pharmaceutical, and existing or emerging biotechnology companies, academic research institutions and governmental agencies and public and private research institutions worldwide.
We believe that our Magellan™ platform, our scientific capabilities, know-how and experience provide us with competitive advantages. However, we expect substantial competition from multiple sources, including major pharmaceutical, specialty pharmaceutical, and existing or emerging biotechnology companies, academic research institutions and governmental agencies and public and private research institutions worldwide.
Minoryx has the right to terminate the Minoryx License Agreement on a country-by-country basis if we abandon the technology or use the technology for purposes in violation of law and we fail to cure 17 Table of Contents such abandonment or unlawful use. We may terminate the Minoryx License Agreement at any time upon 90 days’ written notice.
Minoryx has the right to terminate the Minoryx License Agreement on a country-by-country basis if we abandon the technology or use the technology for purposes in violation of law and we fail to cure such abandonment or unlawful use. We may terminate the Minoryx License Agreement at any time upon 90 days’ written notice.
Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life. U.S.
Additionally, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life.
Type 1 is the most common form in Western countries (around 95%). The prevalence of type 2 and type 3 Gaucher disease, or nGD, is approximately 1:100,000 people worldwide, and these forms are the most common in non-Western countries, especially in Asian countries where they make up more than 50% of the Gaucher disease patient population.
The prevalence of type 2 and type 3 Gaucher disease, or nGD, is approximately 1:100,000 people worldwide, and these forms are the most common in non-Western countries, especially in Asian countries where they make up more than 50% of the Gaucher disease patient population.
Further, there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which have resulted in several recent Congressional inquiries and proposed and enacted bills designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for 25 Table of Contents products.
Further, there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which have resulted in several recent Congressional inquiries and proposed and enacted bills designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products.
The federal 26 Table of Contents government continues to use the FCA, and the accompanying threat of significant liability, in its investigations and prosecutions of pharmaceutical and biotechnology companies throughout the U.S. Such investigations and prosecutions frequently involve, for example, the alleged promotion of products for unapproved uses and other sales and marketing practices.
The federal government continues to use the FCA, and the accompanying threat of significant liability, in its investigations and prosecutions of pharmaceutical and biotechnology companies throughout the U.S. Such investigations and prosecutions frequently involve, for example, the alleged promotion of products for unapproved uses and other sales and marketing practices.
Gene therapy, which aims to replace mutated genes with non-mutated genes that then can express functional enzymes, is not readily accepted for treating neurological conditions because the procedure is invasive in nature and the efficacy of treating neurological conditions remains to be established.
Gene therapy, which aims to replace mutated genes with non-mutated genes that then can express functional enzymes, is not readily accepted for treating neurological conditions because the procedure is invasive in nature and the efficacy of treating 8 Table of Contents neurological conditions remains to be established.
These clinical trials are intended to establish the overall risk/benefit ratio of the investigational product and to provide an adequate basis for product approval and physician labeling. 20 Table of Contents Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval.
These clinical trials are intended to establish the overall risk/benefit ratio of the investigational product and to provide an adequate basis for product approval and physician labeling. Post-approval trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval.
The graphic below provided an overview of the postulated mechanism of action. ​ Limitations of Current Therapies for the Treatment of LSDs Current therapeutic approaches to address misfolded enzymes have inherent limitations.
The graphic below provides an overview of the postulated mechanism of action . ​ Limitations of Current Therapies for the Treatment of LSDs Current therapeutic approaches to address misfolded enzymes have inherent limitations.
PRIME is a voluntary scheme aimed at enhancing the EMA’s support for the development of medicinal products that target unmet 29 Table of Contents medical needs.
PRIME is a voluntary scheme aimed at enhancing the EMA’s support for the development of medicinal products that target unmet 28 Table of Contents medical needs.
Orphan product exclusivity could block the approval of one of our products for seven years if a competitor obtains approval for the same therapeutic agent for the same indication before we do, 22 Table of Contents unless we are able to demonstrate that our product is clinically superior.
Orphan product exclusivity could block the approval of one of our products for seven years if a competitor obtains approval for the same therapeutic agent for the same indication before we do, unless we are able to demonstrate that our product is clinically superior.
Our average hit rate for validated compounds is 14%, a greater than 100-fold higher success rate compared to traditional high throughput screening methods.
Our average success rate for experimentally validated compounds is 14%, a greater than 100-fold higher success rate compared to traditional high throughput screening methods.
There are several additional potential mechanisms of action including allosteric targeted protein degradation, as well as traditional allosteric inhibition or activation by inducing a conformational change to inhibit or induce binding by the natural ligand of the active site of the protein.
There are several additional potential mechanisms of action including allosteric targeted protein degradation, as well as traditional allosteric inhibition or activation by inducing a 7 Table of Contents conformational change to inhibit or induce binding by the natural ligand of the active site of the protein.
Furthermore, Fast Track designation, Breakthrough Therapy designation, Priority Review and Accelerated Approval do not change the scientific or medical standards for approval or the quality of evidence necessary to support approval but may expedite the development or review process. 23 Table of Contents U.S.
Furthermore, Fast Track designation, Breakthrough Therapy designation, Priority Review and Accelerated Approval do not change the scientific or medical standards for approval or the quality of evidence necessary to support approval but may expedite the development or review process. U.S.
However, an applicant submitting a full NDA would be required to conduct or obtain a right of reference to all of the preclinical studies and adequate and well-controlled clinical trials necessary to demonstrate safety and effectiveness. Employees and Human Capital Resources As of December 31, 2022, we had twenty-eight full-time employees and three part-time employees.
However, an applicant submitting a full NDA would be required to conduct or obtain a right of reference to all of the preclinical studies and adequate and well-controlled clinical trials necessary to demonstrate safety and effectiveness. Employees and Human Capital Resources As of December 31, 2023, we had twenty-nine full-time employees and three part-time employees.
We have entered into a license agreement, dated December 20, 2017 (the “Minoryx License Agreement”), with Minoryx Therapeutics, S.L., a company organized under the laws of Spain (“Minoryx”), pursuant to which we obtained exclusive worldwide license rights from Minoryx to use and exploit its intellectual property (“IP”), including its SEE-Tx® discovery platform for the identification of non-competitive pharmacological chaperones and exclusive worldwide sublicense rights to certain IP licensed by Minoryx from the University of Barcelona and the Institució Catalana de Recerca i Estudis Avançats.
We have entered into a license agreement, dated December 20, 2017 (the “Minoryx License Agreement”), with Minoryx Therapeutics, S.L., a company organized under the laws of Spain (“Minoryx”), pursuant to which we obtained exclusive worldwide license rights from Minoryx to use and exploit its intellectual property (“IP”), including certain components of its computational drug discovery platform Magellan™ for the identification of non-competitive pharmacological chaperones and exclusive worldwide sublicense rights to certain IP licensed by Minoryx from the University of Barcelona and the Institució Catalana de Recerca i Estudis Avançats.
In addition, we regularly use our website to post information regarding our business, product development programs and governance, and we encourage investors to use our website, specifically the section titled “Investor Relations” as a source of information about us.
In addition, we regularly use our website to post information regarding our business, product 32 Table of Contents development programs and governance, and we encourage investors to use our website, specifically the section titled “Investor Relations” as a source of information about us.
We make these reports available through our website as soon as reasonably practicable after we 33 Table of Contents electronically file such reports with, or furnish such reports to, the Securities and Exchange Commission, or the SEC. You can review our electronically filed reports and other information that we file with the SEC on the SEC’s web site at http://www.sec.gov.
We make these reports available through our website as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the Securities and Exchange Commission, or the SEC. You can review our electronically filed reports and other information that we file with the SEC on the SEC’s web site at http://www.sec.gov.
The misfolding of GALC can 13 Table of Contents result in the toxic accumulation of galactosylceramide, inhibiting myelin production, and of psychosine, leading to demyelination of cells and ultimately to Krabbe disease. There is no available cure for Krabbe disease.
The misfolding of GALC can result in the toxic accumulation of galactosylceramide, inhibiting myelin production, and of psychosine, leading to demyelination of cells and ultimately to Krabbe disease. There is no available cure for Krabbe disease.
Up to 15% of patients with Parkinson’s disease carry GBA1 mutations, making it the major genetic risk factor for the disease and this rate is higher in certain patient populations. At present, there is no effective cure for Parkinson’s disease.
Up to 15% of patients with Parkinson’s disease carry GBA1 mutations, making it the largest genetic risk factor for the disease, and this rate is higher in certain ethnic populations. At present, there is no effective cure for Parkinson’s disease.
Any product submitted to the FDA for approval, including a product with Fast Track or Breakthrough Therapy designation, may also be eligible for additional FDA programs intended to expedite the review and approval process, including Priority Review designation and Accelerated Approval.
Any product submitted to the FDA for approval, including a product with Fast Track or Breakthrough Therapy designation, may also be eligible for additional FDA programs intended to expedite the review and approval 21 Table of Contents process, including Priority Review designation and Accelerated Approval.
We believe that SEE-Tx® is uniquely suited to identify allosteric binding sites on the protein surface, which are different from the protein’s active (or orthosteric) binding site where the natural ligand of the protein binds.
We believe that Magellan™ is uniquely suited to identify allosteric binding sites on the protein surface, which are different from the active (or orthosteric) binding site where the natural ligand of the protein binds.
We refer to the small molecules we identify that bind to these allosteric sites as structurally targeted allosteric regulators, or STARs, to reflect their mechanism of action and how they are discovered. The graphic below provided an overview of SEE-Tx®.
We refer to the small molecules we identify that bind to these allosteric sites as structurally targeted allosteric regulators, or STARs, to reflect their mechanism of action and how they are discovered. The graphic below provides an overview of Magellan™.
This patent is expected to expire in 2032. In regard to our GLB program, we in-license from Minoryx pursuant to the Minoryx License Agreement, a patent family with a pending European patent application with claims directed to composition of matter and eight foreign patent applications pending in such jurisdictions such as Canada, Australia, Japan, Europe, and China.
In regard to our GLB program, we in-licensed from Minoryx pursuant to the Minoryx License Agreement, a patent family with a pending European patent application with claims directed to composition of matter and eight foreign patent applications pending in such jurisdictions such as Canada, Australia, Japan, Europe, and China.
We have now identified a hit chemical series that inhibits polymerization of A1AT protein, and a priority patent application was filed in February 2023.
We have identified one allosteric site and identified a hit chemical series that inhibits polymerization of A1AT protein. A priority patent application was filed in February 2023.
We run our SEE-Tx® simulations for target and drug discovery in supercomputer centers where we pay only for time used as and when needed. We can identify a novel allosteric site in one to two weeks, perform virtual screening in three to four weeks, and validate compounds experimentally in two to three weeks.
We run our Magellan™ simulations for target and drug discovery in supercomputer centers where we pay only for time used as and when needed. We can identify a novel allosteric site in one to two weeks, set up and complete virtual screening in three to four weeks, and validate compounds experimentally in two to three weeks.
Our STAR compound also has shown GCase enzyme enhancement in an extended panel of patient derived cells representative of the most frequent and pathogenic GBA1 mutations related to GBA1 PD and nGD.
GT-02287 also has shown GCase enzyme enhancement in an extended panel of patient-derived cells representative of the most frequent and pathogenic GBA1 mutations related to GBA1 PD and nGD.
Overview of Gaucher Disease ​ Gaucher disease is an inherited LSD caused by homozygous mutations of the GBA1 gene that result in the misfolding and subsequent dysfunction of GCase, an enzyme that breaks down fatty chemicals in the body. Gaucher disease is traditionally classified according to one of three types.
Overview of Gaucher Disease Gaucher disease is an inherited LSD caused by homozygous mutations of the GBA1 gene that result in the misfolding and subsequent dysfunction of GCase. Gaucher disease is traditionally classified according to one of three types.
In cell-based functional assays, we observed a dose-dependent increase in GCase activity in normal and GCase mutant cells when treated with GT-02287 as well as a concomitant depletion of the GCase substrate, glucosyl ceremide.
In cell-based functional assays, we observed a dose-dependent increase in GCase activity in normal and GCase mutant cells when treated with GT-02287 as well as a concomitant depletion of the GCase substrates glucosylceramide and glucosylsphingosine.
Additionally, before approving an NDA, the FDA may inspect one or more clinical trial sites to assure compliance with GCP and other requirements and the integrity of the clinical data submitted to the FDA.
Additionally, before approving an NDA, the FDA may inspect one or more clinical trial sites to assure compliance with GCP and other requirements and the integrity of the clinical data submitted to the FDA, and one or more sites where non-clinical testing was conducted to assure compliance with GLP and other requirements.
In type 1 or the infantile form, the onset is observed earlier and is a more severe and rapidly progressive disease. Type 2 and 3 are less severe manifestations and have slower progression with a juvenile or adult onset.
It manifests in a continuum of clinical severity by type. In type 1 or the infantile form, the onset is observed earlier and is a more severe and rapidly progressive disease. Type 2 and 3 are less severe manifestations and have slower progression with a juvenile or adult onset.
We expect to continue to identify and evaluate collaboration, co-development and licensing opportunities that may be similar to or different from the collaborations and licenses that we have entered into. Zentalis Pharmaceuticals, Inc.
We expect to continue to identify and evaluate collaboration, co-development and licensing opportunities that may be similar to or different from the collaborations and licenses that we have entered into. Minoryx Therapeutics, S.L.
The graphic below provided an overview of the differences and benefits of allosteric binding sites compared to active binding sites. ​ 6 Table of Contents Identification of Structurally Targeted Allosteric Regulators (“STARs”) – Our Molecular Hypothesis After an allosteric site has been identified, characterized and selected for targeting, we then use our proprietary structure-based virtual screening methodology to filter a pool of seven to ten million commercially-available compounds to identify those that may potentially bind to the hotspot and have a functional effect.
The graphic below provides an overview of the differences and benefits of allosteric binding sites compared to active binding sites. 6 Table of Contents ​ Identification of Structurally Targeted Allosteric Regulators (“STARs”) – Our Molecular Hypothesis After an allosteric site has been identified, characterized and selected for targeting, we then use our proprietary structure-based virtual screening methodology to explore virtual chemical libraries of over 50 billion compounds to identify those that may bind to the hotspot and have a functional effect.
The FDA reviews an NDA to determine, among other things, whether the drug is safe and effective and whether the facility in which it is manufactured, processed, packaged or held meets standards designed to assure the product’s continued safety, quality and purity.
Once the submission is accepted for filing, the FDA begins an in-depth substantive review of the NDA. The FDA reviews an NDA to determine, among other things, whether the drug is safe and effective and whether the facility in which it is manufactured, processed, packaged or held meets standards designed to assure the product’s continued safety, quality and purity.
We use our exclusively in-licensed computational target and drug discovery platform, Site-Directed Enzyme Enhancement Therapy (“SEE-Tx®”), to discover novel allosteric binding sites on proteins implicated in a disease and to identify proprietary small molecules that bind these sites to modulate protein function and treat the underlying cause of the disease.
Our Magellan™ Platform We use our computational target and drug discovery platform, Magellan™, to discover novel allosteric binding sites on proteins implicated in a disease and to identify proprietary small molecules that bind these sites to modulate protein function and treat the underlying cause of the disease.
Before approving an NDA, the FDA typically will inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications.
The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications.
Discovering and targeting novel allosteric sites with our platform not only reduces traditional drug discovery timelines but enables rational drug design and offers the potential for superior small molecule drugs that are highly specific and that can penetrate hard to reach tissues and cross the blood-brain barrier.
Discovering and targeting novel allosteric sites with our platform not only reduces traditional drug discovery timelines but enables rational drug design and offers the potential for superior small molecule drugs that are highly specific and that can penetrate hard to reach tissues and cross the blood-brain barrier. ​ 5 Table of Contents Our Research Programs We have used the Magellan™ drug discovery platform to identify novel allosteric sites and small molecules for all of our pipeline programs.
Our exclusively in-licensed SEE-Tx® platform was designed to address this problem. We use the platform to discover novel binding sites on proteins implicated in a disease and to identify proprietary small molecules that bind these sites to modulate protein function and treat the underlying cause of the disease.
We use the platform to discover novel binding sites on proteins implicated in a disease and to identify proprietary small molecules that bind these sites to modulate protein function and treat the underlying cause of the disease.
Minoryx’s IP includes the SEE-Tx® discovery platform, certain proprietary Minoryx compounds acting as pharmacological chaperones, all patents and pending applications related thereto and Minoryx’s Know-How and Trademark related to the SEE-Tx® platform.
Minoryx’s IP includes certain components of the Magellan™ drug discovery platform, certain proprietary Minoryx compounds acting as pharmacological chaperones, all patents and pending applications related thereto and Minoryx’s Know-How.
In standard chaperone therapy, the drug binds to the active site of the enzyme or other target protein which impairs the protein’s function to some degree by competing with the active substrate, decreasing efficacy and potentially leading to selectivity issues.
Drugs that binds to the active site of the enzyme or other target protein impair the protein’s function to some degree by competing with the active substrate, decreasing efficacy and potentially leading to selectivity issues.
We believe our therapeutic approach represents a potentially significant change from current approaches by addressing protein misfolding using our efficient and proprietary ability to identify previously undiscovered allosteric sites and compounds that avoid the active sites of enzymes and cross the blood-brain barrier or penetrate other hard-to-treat tissues such as bone and cartilage. 8 Table of Contents Our Pipeline of STARs We are leveraging our SEE-Tx® technology platform to develop a pipeline of novel small molecule drug candidates to address complex diseases.
We believe our therapeutic approach represents a potentially significant change from current approaches by addressing protein misfolding using our efficient and proprietary ability to identify previously undiscovered allosteric sites and compounds that avoid the active sites of enzymes and cross the blood-brain barrier or penetrate other hard-to-treat tissues such as bone and cartilage.
Parkinson's disease often starts with a tremor in one hand and other symptoms including slow movement, stiffness and loss of balance, and progresses to a severely debilitating disease that eventually requires full-time home care or a transfer to a skilled nursing facility.
Death of dopaminergic neurons in the brain causes dopamine levels to drop, leading to the symptoms of Parkinson's disease, which often start with a tremor in one hand and other symptoms including slow movement, stiffness and loss of balance, and progresse to a severely debilitating disease that eventually requires full-time home care or a transfer to a skilled nursing facility.
At present, there is no effective cure or disease-modifying treatment for Krabbe Disease. Treatment of a child who is symptomatic before six months of age is supportive and focused on improving quality of life and avoiding complications.
The prevalence of Krabbe disease is reported as about 1 in 100,000 to 1 in 250,000 live births worldwide. At present, there is no effective cure or disease-modifying treatment for Krabbe Disease. Treatment of a child who is symptomatic before six months of age is supportive and focused on improving quality of life and avoiding complications.
However, the actual protection afforded by a patent varies on a product-by-product basis, from country to country and depends upon many factors, including the type of patent, the scope of its coverage, the availability of regulatory-related extensions, the availability of legal remedies in a particular country and the validity and enforceability of the patent.
However, the actual protection afforded by a patent varies on a product-by-product basis, from country to country and depends upon many factors, including the type of patent, the scope of its coverage, the availability of regulatory-related extensions, the availability of legal remedies in a particular country and the validity and enforceability of the patent. 16 Table of Contents Furthermore, we rely upon trade secrets and know-how and continuing technological innovation to develop and maintain our competitive position.
Individual states in the U.S. have also been increasingly passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
Individual states in the U.S. have also been increasingly passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. 24 Table of Contents From time to time, legislation is drafted, introduced, and passed in Congress that could significantly change the statutory provisions governing the sale, marketing, coverage, and reimbursement of products regulated by CMS or other government agencies.
Data may come from company-sponsored clinical trials intended to test the safety and efficacy of a product’s use or from a number of alternative sources, including studies initiated by investigators. To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety and efficacy of the investigational product to the satisfaction of the FDA.
Data may come from company-sponsored clinical trials intended to test the safety and efficacy of a product’s use or from a number of alternative sources, including studies initiated by investigators.
An advisory committee is a panel of independent experts, including clinicians and other scientific experts, which reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.
The FDA may refer an application for a novel drug to an advisory committee. An advisory committee is a panel of independent experts, including clinicians and other scientific experts, which reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions.
Other federal health reform measures have been proposed and adopted in the U.S. since the ACA was enacted: ● The Budget Control Act of 2011, among other things, created measures for spending reductions by Congress.
It is unclear how any additional challenges and healthcare reform measures of the Biden administration will impact the ACA and our business. 23 Table of Contents Other federal health reform measures have been proposed and adopted in the U.S. since the ACA was enacted: ● The Budget Control Act of 2011, among other things, created measures for spending reductions by Congress.
These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient enrollment in clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs. As a result, our competitors may discover, develop, license, or commercialize products before or more successfully than we do.
These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient 14 Table of Contents enrollment in clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.
These companies include, among others: Prevail Therapeutics, which is evaluating a potential gene therapy candidate in a Phase 1/2 clinical trial, Apollo Therapeutics and Voyager Therapeutics.
There are also companies targeting GBA-PD through other modalities such as gene therapies. These companies include, among others: Prevail Therapeutics, which is evaluating a potential gene therapy candidate in a Phase 1/2 clinical trial, and Voyager Therapeutics.
Vision problems and walking difficulties are the most common initial symptoms in these late-onset forms of the disorder, however, signs and symptoms vary considerably among affected individuals. Individuals with late-onset Krabbe disease may survive many years after the condition begins. Krabbe disease is an inherited LSD caused by mutations in the gene GALC.
The less common forms, those that have a later onset, begin in childhood, adolescence, or adulthood. Vision problems and walking difficulties are the most common initial symptoms in these late-onset forms of the disorder, however, signs and symptoms vary considerably among affected individuals. Individuals with late-onset Krabbe disease may survive many years after the condition begins.
Our Research Programs Using SEE-Tx® Platform In addition, we plan to continue to advance research programs and initiate additional programs targeting allosteric binding sites identified with the SEE-Tx® platform in various therapeutic areas, mainly oncology.
In addition, we plan to continue to advance our existing research programs and initiate additional programs targeting allosteric binding sites identified with the Magellan™ platform in various therapeutic areas through discovery collaborations with industry partners and academic institutions.
Preclinical studies indicate that our STARs help mutated GLB escape premature degradation and travel to the lysosome where it can perform its catalytic activity. These preliminary studies were conducted in vitro using cells that carried the GLB1 mutation. In addition, one compound showed clearance of the toxic GM1 ganglioside accumulation in GM1-affected canine cells.
Binding of two of these compounds to the GLB target has been confirmed using a biophysical assay. Preclinical studies indicate that our STARs help mutated GLB escape premature degradation and travel to the lysosome where it can perform its catalytic activity. These preliminary studies were conducted in vitro using cells that carried the GLB1 mutation.
The IRA also eliminates the “donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and creating a new manufacturer discount program. It is unclear how any additional challenges and healthcare reform measures of the Biden administration will impact the ACA and our business.
The IRA also eliminates the “donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and creating a new manufacturer discount program.
The REMS program could include medication guides, physician communication plans, assessment plans and/or elements to assure safe use, such as restricted distribution methods, patient registries or other risk-minimization tools. The FDA may refer an application for a novel drug to an advisory committee.
The FDA also may require submission of a Risk Evaluation and Mitigation Strategy, or REMS, program to ensure that the benefits of the drug outweigh its risks. The REMS program could include medication guides, physician communication plans, assessment plans and/or elements to assure safe use, such as restricted distribution methods, patient registries or other risk-minimization tools.
Furthermore, we rely upon trade secrets and know-how and continuing technological innovation to develop and maintain our competitive position. We seek to protect our proprietary information, in part, using confidentiality agreements with our collaborators, employees and consultants and invention assignment agreements with our employees. We also have confidentiality agreements or invention assignment agreements with our collaborators and selected consultants.
We seek to protect our proprietary information, in part, using confidentiality agreements with our collaborators, employees and consultants and invention assignment agreements with our employees. We also have confidentiality agreements or invention assignment agreements with our collaborators and selected consultants.
People with Gaucher disease type 3 may survive into adulthood with a wide variety of signs and symptoms, including seizures, skeletal irregularities, eye movement disorders, cognitive and coordination problems as well as enlarged liver and spleen, respiratory problems and blood disorders. ​ Gaucher disease is caused by mutations of the GBA1 gene that encodes GCase, an enzyme which catalyzes a key step in breaking down glucosylceramide and glucosylsphingosine.
People with Gaucher disease type 3 may survive into adulthood with a wide variety of signs and symptoms, including seizures, skeletal irregularities, eye movement disorders, cognitive and coordination problems as well as enlarged liver and spleen, respiratory problems, and blood disorders.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur requirements for additional capital will depend on many factors, including: ● the time and expense for preclinical studies and clinical trials for our product candidates; ● the time and costs involved in obtaining regulatory approval for our product candidates; ● the cost increases and other potential impacts of macroeconomic factors, including heightened inflation and rising interest rates, exchange rate fluctuations, supply chain disruptions and increases in commodity, energy and fuel prices ; ● costs associated with protecting our intellectual property rights; ● successful commercialization of our product candidates; ● development of marketing and sales capabilities; ● payments received under current and future collaboration agreements, if any; and ● market acceptance of our products.
Biggest changeOur requirements for additional capital will depend on many factors, including: ● changes in direction of our research and development programs; ● the time and expense for preclinical studies and clinical trials for our product candidates; ● the time and costs involved in obtaining regulatory approval for our product candidates; ● the cost increases and other potential impacts of macroeconomic factors, including heightened inflation and rising interest rates, liquidity concerns at and failures of banks and other financial institutions, exchange rate fluctuations, supply chain disruptions and increases in commodity, energy and fuel prices, costs associated with protecting our intellectual property rights; ● successful commercialization of our product candidates; ● competitive and technical advances; ● patent development or regulatory changes; ● development of marketing and sales capabilities; ● payments received under current and future collaboration agreements, if any; and ● market acceptance of our products. 46 Table of Contents Our ability to continue operations after our current cash resources are exhausted depends on our ability to obtain additional financing or to achieve profitable operations, as to which no assurances can be given.
If our information technology systems or data, or those of third parties upon which we rely, or our data are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; and other adverse consequences .
If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; and other adverse consequences.
The CCPA allows for administrative fines for noncompliance (up to $7,500 per violation) and allows private litigants affected by certain data breaches to recover significant statutory damages. Although the CCPA exempts some data processed in the context of clinical trials, the CCPA increases compliance costs and potential liability with respect to other personal information we maintain about California residents.
The CCPA provides for administrative fines for noncompliance (up to $7,500 per violation) and allows private litigants affected by certain data breaches to recover significant statutory damages. Although the CCPA exempts some data processed in the context of clinical trials, the CCPA increases compliance costs and potential liability with respect to other personal information we maintain about California residents.
Even if our clinical trials demonstrate acceptable safety and efficacy of STAR molecules for a targeted disease, the labeling we obtain through negotiations with the FDA or foreign regulatory authorities may not include data on secondary endpoints and may not provide us with a competitive advantage over other products approved for the same or similar indications.
Even if our clinical trials demonstrate acceptable safety and efficacy of STAR molecules for a targeted disease, the labeling we obtain through negotiations with the FDA or comparable foreign regulatory authorities may not include data on secondary endpoints and may not provide us with a competitive advantage over other products approved for the same or similar indications.
Different methodologies, assumptions and applications we utilize to assess particular safety or efficacy parameters may yield different statistical results. Even if we believe the data collected from clinical trials of our product candidates are promising, these data may not be sufficient to support approval by the FDA or foreign regulatory authorities.
Different methodologies, assumptions and applications we utilize to assess particular safety or efficacy parameters may yield different statistical results. Even if we believe the data collected from clinical trials of our product candidates are promising, these data may not be sufficient to support approval by the FDA or comparable foreign regulatory authorities.
Our federal NOL carryforwards generated in tax years beginning after December 31, 2017, may be carried forward indefinitely, but the deductibility of such federal NOL carryforward may be limited. It is uncertain if and to what extent various states will conform to U.S. federal income tax law with respect to the treatment of NOL carryforwards.
Our federal NOL carryforwards generated in tax years beginning after December 31, 2017, may be carried forward indefinitely, but the deductibility of such federal NOL carryforwards may be limited. It is uncertain if and to what extent various states will conform to U.S. federal income tax law with respect to the treatment of NOL carryforwards.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. In addition, Section 404 of the Sarbanes-Oxley Act of 2002 (Section 404) and related SEC rules require management to furnish a report on the effectiveness of our internal control over financial reporting.
Our management is responsible for establishing and maintaining adequate system of internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. In addition, Section 404 of the Sarbanes-Oxley Act of 2002 (Section 404) and related SEC rules require management to furnish a report on the effectiveness of our internal control over financial reporting.
The laws that will affect our operations include, but are not limited to: ● the federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from knowingly and willfully soliciting, receiving, offering or paying any remuneration (including any kickback, bribe or rebate), directly or indirectly, overtly or covertly, in cash or in kind, in return for the purchase, recommendation, leasing or furnishing of an item or service reimbursable under a federal healthcare program, such as the Medicare and Medicaid programs; ● federal civil and criminal false claims laws, including, without limitation, the False Claims Act, and civil monetary penalty laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid or other government payors that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; ● HIPAA, which created new federal criminal statutes that prohibit a person from, among other things, knowingly and willfully executing a scheme or making false or fraudulent statements to defraud any healthcare benefit program, regardless of the payor (e.g., public or private); ● HIPAA, as amended by HITECH and its implementing regulations, and as amended again by the final HIPAA omnibus rule, Modifications to the HIPAA Privacy, Security, Enforcement, and Breach Notification Rules Under HITECH and the Genetic Information Nondiscrimination Act; Other Modifications to HIPAA, published in January 2013, which imposes certain requirements relating to the privacy, security and transmission of individually identifiable health information without appropriate authorization by entities subject to the rule, such as health plans, health care clearinghouses and certain health care providers, and their respective business associates and covered subcontractors; ● federal transparency laws, including the federal Physician Payments Sunshine Act, which is part of the Patient Protection and Affordable Care Act (“ACA”), that require certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to the Centers for Medicare & Medicaid Services (“CMS”), information related to: (i) payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare professionals (such as physician assistants and nurse practitioners), and teaching hospitals; and (ii) ownership and investment interests held by physicians and their immediate family members; 57 Table of Contents ● state and foreign law equivalents of each of the above federal laws, state laws that require manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures, and state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or to adopt compliance programs as prescribed by state laws and regulations, or that otherwise restrict payments that may be made to healthcare providers; and ● state and foreign laws that govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.
The laws that will affect our operations include, but are not limited to: ● the federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from knowingly and willfully soliciting, receiving, offering or paying any remuneration (including any kickback, bribe or rebate), directly or indirectly, overtly or covertly, in cash or in kind, in return for the purchase, recommendation, leasing or furnishing of an item or service reimbursable under a federal healthcare program, such as the Medicare and Medicaid programs; ● federal civil and criminal false claims laws, including, without limitation, the False Claims Act, and civil monetary penalty laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid or other government payors that are false or fraudulent or making a false statement to avoid, decrease or conceal an obligation to pay money to the federal government; ● HIPAA, which created new federal criminal statutes that prohibit a person from, among other things, knowingly and willfully executing a scheme or making false or fraudulent statements to defraud any healthcare benefit program, regardless of the payor (e.g., public or private); ● HIPAA, as amended by HITECH and its implementing regulations, and as amended again by the final HIPAA omnibus rule, Modifications to the HIPAA Privacy, Security, Enforcement, and Breach Notification Rules Under HITECH and the Genetic Information Nondiscrimination Act; Other Modifications to HIPAA, published in January 2013, which imposes certain requirements relating to the privacy, security and transmission of individually identifiable health information without appropriate authorization by entities subject to the rule, such as health plans, health care clearinghouses and certain health care providers, and their respective business associates and covered subcontractors; ● federal transparency laws, including the federal Physician Payments Sunshine Act, which is part of the Patient Protection and Affordable Care Act (“ACA”), that require certain manufacturers of drugs, devices, biologics and medical supplies for which payment is available under Medicare, Medicaid or the Children’s Health Insurance Program, with specific exceptions, to report annually to the Centers for Medicare & Medicaid Services (“CMS”), information related to: (i) payments or other “transfers of value” made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), other healthcare professionals (such as physician assistants and nurse practitioners), and teaching hospitals; and (ii) ownership and investment interests held by physicians and their immediate family members; 58 Table of Contents ● state and foreign law equivalents of each of the above federal laws, state laws and foreign law equivalents that require manufacturers to report information related to payments and other transfers of value to physicians and other healthcare professionals or marketing expenditures, state laws and foreign law equivalents that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government or competent regulatory authority or to adopt compliance programs as prescribed by applicable laws and regulations, or that otherwise restrict payments that may be made to healthcare professionals; and ● state and foreign laws that govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.
We are significantly dependent upon our license with Minoryx Therapeutics S.L. (the “Minoryx License”), as described in the section “Business- Strategic Collaboration and Licensing Arrangements- Minoryx Therapeutics, S.L.” in our Annual Report. The Minoryx License grants us exclusive, worldwide rights to certain patents and related intellectual property.
We are significantly dependent upon our license with Minoryx Therapeutics S.L. (the “Minoryx License”), as described in the section “Business – Strategic Transactions; Collaboration and Licensing Arrangements – Minoryx Therapeutics, S.L.” in our Annual Report. The Minoryx License grants us exclusive, worldwide rights to certain patents and related intellectual property.
If our study data do not consistently or sufficiently demonstrate the safety or efficacy of any of our product candidates, then the regulatory approvals for such product candidates could be significantly delayed as we work to meet approval requirements, or, if we are not able to meet these requirements, such approvals could be withheld or withdrawn.
If our study data do not consistently or sufficiently demonstrate the safety or efficacy of any of our product candidates, then the regulatory approvals for such product candidates could be significantly delayed as we work to meet approval requirements, or, if we are not able to meet these requirements, such approvals could be withheld, varied or withdrawn.
Once a clinical trial has begun, it may be delayed, suspended or terminated by us or the FDA or other regulatory authorities due to a number of factors, including: ● ongoing discussions with the FDA or other regulatory authorities regarding the scope or design of our clinical trials; ● failure to conduct clinical trials in accordance with regulatory requirements; ● lower than anticipated recruitment or retention rate of patients in clinical trials; ● inspection of the clinical trial operations or study sites by the FDA or other regulatory authorities resulting in the imposition of a clinical hold; ● lack of adequate funding to continue clinical trials; ● negative results of clinical trials; ● investigational drug product out-of-specification; or ● nonclinical or clinical safety observations, including adverse events and SAEs.
Once a clinical trial has begun, it may be delayed, suspended or terminated by us or the FDA or other comparable foreign regulatory authorities due to a number of factors, including: ● ongoing discussions with the FDA or other comparable foreign regulatory authorities regarding the scope or design of our clinical trials; ● failure to conduct clinical trials in accordance with regulatory requirements; ● lower than anticipated recruitment or retention rate of patients in clinical trials; ● inspection of the clinical trial operations or study sites by the FDA or other comparable foreign regulatory authorities resulting in the imposition of a clinical hold; ● lack of adequate funding to continue clinical trials; ● negative results of clinical trials; ● investigational drug product out-of-specification; or ● nonclinical or clinical safety observations, including adverse events and SAEs.
Success in early preclinical studies or clinical trials may not be indicative of results obtained in later preclinical studies and clinical trials; ◾ clinical trials required for our product candidates are expensive and time-consuming, and their outcome is uncertain; ◾ we will need to raise additional capital, which may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates, and additional capital may not be available on favorable terms or at all, which may force us to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations; ◾ we are subject to extensive and costly government regulation; ◾ even if we obtain regulatory approval to market our product candidates, our product candidates may not be accepted by the market; 34 Table of Contents ◾ we rely on a license to use the technology that is material to our business and if the agreement underlying the license were to be terminated or if other rights that may be necessary for commercializing our intended products cannot be obtained, it would halt our ability to market our products and technology, as well as have an immediate material adverse effect on our business, operating results and financial condition; ◾ we are subject to stringent and evolving U.S. and foreign laws, regulations, rules, contractual obligations, policies and other obligations related to data privacy and security.
Success in early preclinical studies or clinical trials may not be indicative of results obtained in later preclinical studies and clinical trials; ◾ clinical trials required for our product candidates are expensive and time-consuming, and their outcomes are uncertain; ◾ we will need to raise additional capital, which may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates, and additional capital may not be available on favorable terms or at all, which may force us to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations; ◾ we are subject to extensive and costly government regulation; ◾ even if we obtain regulatory approval to market our product candidates, our product candidates may not be accepted by the market; ◾ we rely on a license to use the technology that is material to our business and if the agreement underlying the license were to be terminated or if other rights that may be necessary for commercializing our intended 33 Table of Contents products cannot be obtained, it would halt our ability to market our products and technology, as well as have an immediate material adverse effect on our business, operating results and financial condition; ◾ we are subject to stringent and evolving U.S. and foreign laws, regulations, rules, contractual obligations, policies and other obligations related to data privacy and security.
If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion of drugs from government funded healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws and the curtailment or restructuring of our operations.
If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion of drugs from government funded healthcare programs, such as Medicare and Medicaid or comparable foreign programs, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws and the curtailment or restructuring of our operations.
Where data from foreign clinical trials are intended to serve as the basis for marketing approval in the U.S., the FDA will not approve the application on the basis of foreign data alone unless those data are applicable to the U.S. population and U.S. medical practice; the studies were performed by clinical investigators of recognized competence; and the data are considered valid without the need for an on-site inspection by the FDA or, if the FDA considers such an inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means.
Where data from foreign clinical trials are intended to serve as the basis for marketing approval in the United States, the FDA will not approve the application on the basis of foreign data alone unless those data are applicable to the U.S. population and U.S. medical practice; the studies were performed by clinical investigators of recognized competence; and the data are considered valid without the need for an on-site inspection by the FDA or, if the FDA considers such an inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means.
If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate. 40 Table of Contents Clinical trials required for our product candidates are expensive and time-consuming, and their outcome is uncertain.
If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate. 39 Table of Contents Clinical trials required for our product candidates are expensive and time-consuming, and their outcome is uncertain.
Preclinical and clinical data can be interpreted in different ways. Accordingly, the FDA or foreign regulatory authorities could interpret these data in different ways from us or our partners, which could delay, limit or prevent regulatory approval.
Preclinical and clinical data can be interpreted in different ways. Accordingly, the FDA or comparable foreign regulatory authorities could interpret these data in different ways from us or our partners, which could delay, limit or prevent regulatory approval.
Our current and future arrangements with healthcare professionals, principal investigators, consultants, customers and third-party payors may subject us to various federal and state fraud and abuse laws and other healthcare laws, including, without limitation, the federal Anti-Kickback Statute, the federal civil and criminal false claims laws and the law commonly referred to as the Physician Payments Sunshine Act and regulations.
Our current and future arrangements with healthcare professionals, principal investigators, consultants, customers and third-party payors may subject us to various federal and state fraud and abuse laws and other healthcare laws, including, without limitation, the federal Anti-Kickback Statute, the federal civil and criminal false claims laws and the law commonly referred to as the Physician Payments Sunshine Act and regulations, and foreign equivalent laws and regulations.
Further, we and our product candidates are subject to extensive regulation by the FDA and comparable regulatory authorities in other countries governing, among other things, research, testing, clinical trials, manufacturing, labeling, promotion, selling, adverse event reporting and recordkeeping. Obtaining FDA approval is a lengthy, expensive and uncertain process.
Further, we and our product candidates are subject to extensive regulation by the FDA and comparable regulatory authorities in other countries governing, among other things, research, testing, clinical trials, manufacturing, labeling, promotion, selling, adverse event reporting and recordkeeping. Obtaining FDA and comparable foreign regulatory authority approval is a lengthy, expensive and uncertain process.
Material changes to an approved product, such as, for example, manufacturing changes or revised labeling, may require further regulatory review and approval. Once obtained, any approvals may be withdrawn, including, for example, if there is a later discovery of previously unknown problems with the product, such as a previously unknown safety issue.
Material changes to an approved product, such as, for example, manufacturing changes or revised labeling, may require further regulatory review and approval. Once obtained, any approvals may be withdrawn, suspended or varied, including, for example, if there is a later discovery of previously unknown problems with the product, such as a previously unknown safety issue.
For example, under the EU GDPR, government regulators may impose temporary or definitive bans on data processing, as well as fines of up to 20 million euros (17.5 million British Pounds under the UK GDPR) or 4% of annual global revenue, whichever is greater, or we may be subject to private litigation related to processing of personal information brought by classes of data subjects or consumer protection organizations authorized at law to represent.
For example, under GDPR, government regulators may impose temporary or definitive bans on data processing, as well as fines of up to 20 million euros under the EU GDPR (17.5 million British Pounds under the UK GDPR) or 4% of annual global revenue, in either case, whichever is greater, or we may be subject to private litigation related to processing of personal information brought by classes of data subjects or consumer protection organizations authorized at law to represent.
To the extent that we enter into any marketing, sales, or distribution arrangements with third parties, our product revenues will be lower than if we marketed and sold 53 Table of Contents our products directly, and any revenues we receive will depend upon the efforts of such third-parties.
To the extent that we enter into any marketing, 54 Table of Contents sales, or distribution arrangements with third parties, our product revenues will be lower than if we marketed and sold our products directly, and any revenues we receive will depend upon the efforts of such third-parties.
If we are unable to enforce these covenants not to compete, we may be unable to prevent our competitors from benefiting from the expertise of our former employees or consultants and our competitiveness may be diminished. 56 Table of Contents If we are unable to hire additional qualified personnel, our ability to grow our business may be harmed.
If we are unable to enforce these covenants not to compete, we may be unable to prevent our competitors from benefiting from the expertise of our former employees or consultants and our competitiveness may be diminished. 57 Table of Contents If we are unable to hire additional qualified personnel, our ability to grow our business may be harmed.
The results of future clinical trials may show that our product candidates cause SAEs or undesirable side effects, which could interrupt, delay or halt clinical trials, resulting in delay of, or failure to obtain, marketing approval from the FDA and other regulatory authorities.
The results of future clinical trials may show that our product candidates cause SAEs or undesirable side effects, which could interrupt, delay or halt clinical trials, resulting in delay of, or failure to obtain, marketing approval from the FDA and other comparable foreign regulatory authorities.
If any of our product candidates cause SAEs or undesirable side effects or suffer from quality control issues: ● regulatory authorities may impose a clinical hold or REMS, which could result in substantial delays, significantly increase the cost of development, and/or adversely impact our ability to continue development of the product; ● regulatory authorities may require the addition of statements, specific warnings, or contraindications to the product label, or restrict the product’s indication to a smaller potential treatment population; ● we may be required to change the way the product is administered or conduct additional clinical trials; ● we may be required to implement a risk minimization action plan, which could result in substantial cost increases and have a negative impact on our ability to commercialize the product; ● we may be required to limit the participants who can receive the product; ● we may be subject to limitations on how we promote the product; ● we may, voluntarily or involuntarily, initiate field alerts for product recall, which may result in shortages; ● sales of the product may decrease significantly; ● regulatory authorities may require us to take our approved product off the market; ● we may be subject to litigation or product liability claims, and ● our reputation may suffer.
If any of our product candidates cause SAEs or undesirable side effects or suffer from quality control issues: ● regulatory authorities may impose a clinical hold or REMS, or comparable foreign regulatory strategies, which could result in substantial delays, significantly increase the cost of development, and/or adversely impact our ability to continue development of the product; ● regulatory authorities may require the addition of statements, specific warnings, or contraindications to the product label, or restrict the product’s indication to a smaller potential treatment population; 43 Table of Contents ● we may be required to change the way the product is administered or conduct additional clinical trials; ● we may be required to implement a risk minimization action plan, which could result in substantial cost increases and have a negative impact on our ability to commercialize the product; ● we may be required to limit the participants who can receive the product; ● we may be subject to limitations on how we promote the product; ● we may, voluntarily or involuntarily, initiate field alerts for product recall, which may result in shortages; ● sales of the product may decrease significantly; ● regulatory authorities may require us to take our approved product off the market; ● we may be subject to litigation or product liability claims, and ● our reputation may suffer.
Our ability to generate revenue and achieve profitability will depend on, among other things, successful completion of preclinical development and testing and clinical trials of our product candidates; obtaining necessary regulatory approvals from the FDA; establishing manufacturing, sales and marketing arrangements with third parties; successfully commercializing our products; establishing a favorable competitive position; and raising sufficient funds to finance our activities.
Our ability to generate revenue and achieve profitability will depend on, among other things, successful completion of preclinical development and testing and clinical trials of our product candidates; obtaining necessary regulatory approvals from the FDA and comparable foreign regulatory authorities; establishing manufacturing, sales and marketing arrangements with third parties; successfully commercializing our products; establishing a favorable competitive position; and raising sufficient funds to finance our activities.
Patient enrollment may be affected by other factors including: ● the severity of the disease under investigation; 38 Table of Contents ● design of the study protocol; ● the eligibility criteria for the trial; ● the perceived risks, benefits and convenience of administration of the product candidate being studied; ● our efforts to facilitate timely enrollment in clinical trials; ● the availability of other clinical trials being conducted for the same indication; ● the patient referral practices of physicians; and ● the proximity and availability of clinical trial sites to prospective patients.
Patient enrollment may be affected by other factors including: ● the severity of the disease under investigation; ● design of the study protocol; ● the eligibility criteria for the trial; ● the perceived risks, benefits and convenience of administration of the product candidate being studied; ● our efforts to facilitate timely enrollment in clinical trials; ● the availability of other clinical trials being conducted for the same indication; ● the patient referral practices of physicians; and ● the proximity and availability of clinical trial sites to prospective patients.
We and our CROs are required to comply with the FDA’s Good Clinical Practices (“GCPs”) for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected.
We and our CROs are required to comply with the FDA’s Good Clinical Practices (“GCPs”) and foreign equivalents for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected.
In addition, the IRA, among other things, (1) directs HHS to negotiate the price of certain single-source drugs and biologics covered under Medicare and (2) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.
In addition, the IRA, among other things, (1) directs HHS to negotiate the price of certain high expenditure single-source drugs and biologics covered under Medicare and (2) imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation.
If a drug is intended for the treatment of a serious or life-threatening condition and the drug demonstrates the potential to address unmet medical 42 Table of Contents needs for this condition, the product sponsor may apply for FDA Fast Track Designation.
If a drug is intended for the treatment of a serious or life-threatening condition and the drug 41 Table of Contents demonstrates the potential to address unmet medical needs for this condition, the product sponsor may apply for FDA Fast Track Designation.
Risks Related to Product Development, Regulatory Approval, Manufacturing and Commercialization We may conduct certain of our clinical trials for our product candidates outside of the U.S. which, among other risks, exposes us to the possibility that the FDA and other foreign equivalents may not accept data from such trials, in which case our development plans will be delayed, which could materially harm our business.
Risks Related to Product Development, Regulatory Approval, Manufacturing and Commercialization We may conduct certain of our clinical trials for our product candidates outside of the U.S. which, among other risks, exposes us to the possibility that the FDA and other comparable foreign regulatory authorities may not accept data from such trials, in which case our development plans will be delayed, which could materially harm our business.
Also, third parties we rely on for preclinical development, such as the providers of supercomputer time needed for our SEE-Tx® platform and collaborators that provide us with materials and resources may fail to fulfill their obligations to us in a timely manner or at all and the development of our product candidates could be significantly delayed as a result.
Also, third parties we rely on for preclinical development, such as the providers of supercomputer time needed for our Magellan™ platform and collaborators that provide us with materials and resources may fail to fulfill their obligations to us in a timely manner or at all and the development of our product candidates could be significantly delayed as a result.
In addition, our Amended Charter and 69 Table of Contents Amended Bylaws provide that we will, to the fullest extent permitted by Delaware law, indemnify our directors and officers for costs or damages incurred by them in connection with any threatened, pending, or completed action, suit, or proceeding brought against them by reason of their positions as directors and officers.
In addition, our Amended Charter and Amended Bylaws provide that we will, to the fullest extent permitted by Delaware law, indemnify our directors and officers for costs or damages incurred by them in connection with any threatened, pending, or completed action, suit, or proceeding brought against them by reason of their positions as directors and officers.
Additionally, the reported number of people in the indication we aim to treat, as well as the people with these diseases who have the potential to benefit from treatment with our product candidates, are based on estimates.
Additionally, the reported number of people in the indications we aim to treat, as well as the people with these diseases who have the potential to benefit from treatment with our product candidates, are based on estimates.
Under applicable employment laws, we may not be able to enforce covenants not to compete and therefore may be unable to prevent our competitors from benefiting from the expertise of some of our former employees. Our employment agreements generally include covenants not to compete.
Under applicable employment laws, we may not be able to enforce covenants not to compete and therefore may be unable to prevent our competitors from benefiting from the expertise of some of our former employees. Our employment arrangements generally include covenants not to compete.
If products employing our technologies are marketed abroad, they will also be subject to extensive regulation by foreign governments, whether or not they have obtained the FDA’s approval for a given product and its uses. Such foreign regulation may be equally or more demanding than corresponding United States regulation.
If products employing our technologies are marketed abroad, they will also be subject to extensive regulation by foreign governments, whether or not they have obtained the FDA’s or comparable foreign regulatory authorities’ approval for a given product and its uses. Such foreign regulation may be equally or more demanding than corresponding United States regulation.
The market price for our common stock may be influenced by many factors, including: ● results from, and any delays in our preclinical studies and any other future clinical development programs, including any delays related to the health epidemics or pandemics such as the COVID-19 pandemic or other factors outside of our control; ● actual or anticipated changes in estimates as to financial results, development timelines and other company milestones or recommendations by securities analysts; ● announcements of changes to our operational focus, including changes to the programs we are actively developing; ● announcements by our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; ● announcements of technological innovations or new products by us or our competitors; ● announcement of FDA approval or disapproval of our product candidates or other product-related actions; ● developments involving our discovery efforts and clinical trials; ● developments or disputes concerning patents or proprietary rights, including announcements of infringement, interference or other litigation against us or our potential licensees; ● developments involving our efforts to commercialize our products, including developments impacting the timing of commercialization; ● announcements concerning our competitors, or the biotechnology, pharmaceutical or drug delivery industry in general; ● public concerns as to the safety or efficacy of our product candidates or our competitors’ products; ● changes in government regulation of the pharmaceutical or medical industry; ● changes in the reimbursement policies of third-party insurance companies or government agencies; ● actual or anticipated fluctuations in our operating results; ● changes in financial estimates or recommendations by securities analysts; ● developments involving corporate collaborators, if any; 65 Table of Contents ● changes in accounting principles; ● general economic, industry and market conditions, increasing inflation and measures taken by central banks to combat inflation, exchange rate fluctuations, supply chain disruptions and increasing commodity, energy and fuel prices; ● the impact of political instability, natural disasters, events of terrorism and/or war, such as the war between Ukraine and Russia, and the corresponding tensions created from such conflict between Russia, the United States and countries in Europe as well as other countries such as China; and ● the loss of any of our key scientific or management personnel.
The market price for our common stock may be influenced by many factors, including: ● results from, and any delays in our preclinical studies and any other future clinical development programs, including any delays related to the health epidemics or pandemics or other factors outside of our control; ● actual or anticipated changes in estimates as to financial results, development timelines and other company milestones or recommendations by securities analysts; ● announcements of changes to our operational focus, including changes to the programs we are actively developing; ● announcements by our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; ● announcements of technological innovations or new products by us or our competitors; ● announcement of FDA or comparable foreign regulatory authority approval or disapproval of our product candidates or other product-related actions; ● developments involving our discovery efforts and clinical trials; ● developments or disputes concerning patents or proprietary rights, including announcements of infringement, interference or other litigation against us or our potential licensees; ● developments involving our efforts to commercialize our products, including developments impacting the timing of commercialization; ● announcements concerning our competitors, or the biotechnology, pharmaceutical or drug delivery industry in general; ● public concerns as to the safety or efficacy of our product candidates or our competitors’ products; ● changes in government regulation of the pharmaceutical or medical industry; 68 Table of Contents ● changes in the reimbursement policies of third-party insurance companies or government agencies; ● actual or anticipated fluctuations in our operating results; ● changes in financial estimates or recommendations by securities analysts; ● developments involving corporate collaborators, if any; ● changes in accounting principles; ● general economic, industry and market conditions, heightened inflation and measures taken by central banks to combat inflation, exchange rate fluctuations, supply chain disruptions and increasing commodity, energy and fuel prices; ● the impact of political instability, natural disasters, events of terrorism and/or war, such as the war in Ukraine and the conflict between Hamas and Israel, and the corresponding tensions created from such conflict between Russia, the United States and countries in Europe as well as other countries such as China; and ● the loss of any of our key scientific or management personnel.
Additionally, if a competitor receives FDA approval before we do for a drug that is similar to one of our product candidates, FDA approval for our product candidate may be precluded or delayed due to periods of non-patent 46 Table of Contents exclusivity and/or the listing with the FDA by the competitor of patents covering its newly-approved drug product.
Additionally, if a competitor receives FDA approval before we do for a drug that is similar to one of our product candidates, FDA approval for our product candidate may be precluded or delayed due to periods of non-patent exclusivity and/or the listing with the FDA by the competitor of patents covering its newly-approved drug product.
Our Amended Charter will further provide that, unless we consent in writing to the selection of an alternative forum, the federal district courts are the sole and exclusive forum for the resolution of any complaint asserting a right under the Securities Act, subject to a final adjudication in the State of Delaware of the enforceability of such exclusive forum provision.
Our Amended Charter further provides that, unless we consent in writing to the selection of an alternative forum, the federal district courts are the sole and exclusive forum for the resolution of any complaint asserting a right under the Securities Act, subject to a final adjudication in the State of Delaware of the enforceability of such exclusive forum provision.
If we are unable to successfully develop, receive regulatory approval for and commercialize our current or future product candidates, our business will be harmed. Because the SEE-Tx® platform remains untested and our product candidates are in early stages of development, they will require extensive preclinical and clinical testing.
If we are unable to successfully develop, receive regulatory approval for and commercialize our current or future product candidates, our business will be harmed. Because the Magellan™ platform remains untested and our product candidates are in early stages of development, they will require extensive preclinical and clinical testing.
These risks and uncertainties include the following: patents that may be issued or licensed may be challenged, invalidated, or circumvented, or otherwise may not provide us any competitive advantage; our competitors, many of which have substantially greater resources than we and many of which have made significant investments in competing technologies, may seek, or may already have obtained, patents that will limit, interfere with, or eliminate our ability to make, use, and sell our potential 48 Table of Contents products either in the United States or in international markets; there may be significant pressure on the United States government and other international governmental bodies to limit the scope of patent protection both inside and outside the United States for treatments that prove successful as a matter of public policy regarding worldwide health concerns; and countries other than the United States may have less robust patent laws than those upheld by United States courts, allowing foreign competitors the ability to exploit these laws to create, develop, and market competing products using our technologies and patents.
These risks and uncertainties include the following: patents that may be issued or licensed may be challenged, invalidated, or circumvented, or otherwise may not provide us any competitive advantage; our competitors, many of which have substantially greater resources than we and many of which have made significant investments in competing technologies, may seek, or may already have obtained, patents that will limit, interfere with, or eliminate our ability to make, use, and sell our potential products either in the United States or in international markets; there may be significant pressure on the United States government and other international governmental bodies to limit the scope of patent protection both inside and outside the United States for treatments that prove successful as a matter of public policy regarding worldwide health concerns; and countries other than the United States may have less robust patent laws than those upheld by United States courts, allowing foreign competitors the ability to exploit these laws to create, develop, and market competing products using our technologies and patents. 49 Table of Contents Moreover, any patents issued to us may not provide us with meaningful protection, or others may challenge, circumvent or narrow our patents.
The commencement of clinical trials can be delayed for a variety of reasons, including delays in: ● demonstrating sufficient safety and efficacy to obtain regulatory approval to commence a clinical trial; ● reaching agreement on acceptable terms with prospective CROs and study sites; ● developing a stable formulation of a product candidate; ● manufacturing sufficient quantities of a product candidate; and ● obtaining institutional review board (“IRB”) approval to conduct a clinical trial at a prospective site.
The commencement of clinical trials can be delayed for a variety of reasons, including delays in: ● demonstrating sufficient safety and efficacy to obtain regulatory approval to commence a clinical trial; ● reaching agreement on acceptable terms with prospective CROs and study sites; ● developing a stable formulation of a product candidate; ● manufacturing sufficient quantities of a product candidate; and ● obtaining institutional review board (“IRB”) approval or ethic committee opinions to conduct a clinical trial at a prospective site.
Any such delays or failures to obtain regulatory approval could cause our prospects to suffer significantly. ​ Failure by our third-party manufacturers to comply with the regulatory guidelines set forth by the FDA with respect to our product candidates could delay or prevent the completion of clinical trials, the approval of any product candidates or the commercialization of our products.
Any such delays or failures to obtain regulatory approval could cause our prospects to suffer significantly. ​ Failure by our third-party manufacturers to comply with the regulatory guidelines set forth by the FDA or comparable foreign regulatory authorities with respect to our product candidates could delay or prevent the completion of clinical trials, the approval of any product candidates or the commercialization of our products.
We may not prevail in any such actions and any license required under any of these patents may not be made available on commercially acceptable terms, if at all. In addition, 50 Table of Contents we may not be able to redesign any future product candidates or processes to avoid infringement, if necessary.
We may not prevail in any such actions and any license required under any of these patents may not be made available on commercially acceptable terms, if at all. In addition, we may not be able to redesign any future product candidates or processes to avoid infringement, if necessary.
These operations provide a limited basis to assess our ability to develop and commercialize our product candidates. 41 Table of Contents Because of this lack of experience, any future clinical trials we may conduct may not be completed on time, if at all.
These operations provide a limited basis to assess our ability to develop and commercialize our product candidates. 40 Table of Contents Because of this lack of experience, any clinical trials we may conduct may not be completed on time, if at all.
As part of our business strategy, we may seek Orphan Drug Designation for one or more of our product candidates, and we may be unsuccessful. Regulatory authorities in some jurisdictions, including the United States and Europe, may designate drugs for relatively small patient populations as orphan drugs.
As part of our business strategy, we may seek Orphan Drug Designation for one or more of our product candidates, and we may be unsuccessful. Regulatory authorities in some jurisdictions, including the United States and European countries, may designate drugs for relatively small patient populations as orphan drugs.
Any legal action against us claiming damages and seeking to enjoin commercial activities relating to our SEE-Tx® platform or our processes could subject us to potential liability for damages and require us to obtain a license to continue to manufacture or market any future product candidates based upon the SEE-Tx® platform.
Any legal action against us claiming damages and seeking to enjoin commercial activities relating to our Magellan™platform or our processes could subject us to potential liability for damages and require us to obtain a license to continue to manufacture or market any future product candidates based upon the Magellan™platform.
If there is no lawful manner for us to transfer personal information from the EEA, the UK, or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions at significant expense, increased exposure to regulatory actions, substantial 62 Table of Contents fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal information necessary to operate our business.
If there is no lawful manner for us to transfer personal information from the EEA, the UK, or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions (such as Europe) at significant expense, increased exposure to regulatory actions, substantial fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal information necessary to operate our business.
By extension, clinical trials that are predominantly conducted in the United States or primarily based on feedback from the FDA may not result in sufficiently diverse patient populations to warrant approval in other countries (for example, Japan) or those other health authorities may have differences of opinion on appropriateness of trial design or differences in interpretation of some data.
By extension, clinical trials that are predominantly conducted in the United States or primarily based on feedback from the FDA may not result in sufficiently diverse patient populations to warrant approval in other countries (for example, Japan) or those other comparable foreign regulatory authorities may have differences of opinion on appropriateness of trial design or differences in interpretation of some data.
We intend to rely on third parties to manufacture the compounds used in our studies, and we intend to rely on them for the manufacture of any approved products for commercial sale.
We currently rely on and intend to rely in the future on third parties to manufacture the compounds used in our studies, and we intend to rely on them for the manufacture of any approved products for commercial sale.
The degree of market acceptance of any pharmaceutical product that we develop will depend on a number of factors, including: ● cost-effectiveness; ● the safety and effectiveness of our products, including any significant potential side effects (including drowsiness and dry mouth), as compared to alternative products or treatment methods; ● the timing of market entry as compared to competitive products; ● the rate of adoption of our products by doctors and nurses; ● product labeling or product insert required by the FDA for each of our products; ● reimbursement policies of government and third-party payors, and the willingness of patients to pay out of pocket in the absence of adequate third-party payor coverage and reimbursement; ● effectiveness of our sales, marketing and distribution capabilities and the effectiveness of such capabilities of our collaborative partners, if any; and ● unfavorable publicity concerning our products or any similar products.
The degree of market acceptance of any pharmaceutical product that we develop will depend on a number of factors, including: ● cost-effectiveness; 44 Table of Contents ● the safety and effectiveness of our products, including any significant potential side effects (including drowsiness and dry mouth), as compared to alternative products or treatment methods; ● the timing of market entry as compared to competitive products; ● the rate of adoption of our products by doctors and nurses; ● product labeling or product insert required by the FDA and comparable foreign regulatory authorities for each of our products; ● reimbursement policies of government and third-party payors, and the willingness of patients to pay out of pocket in the absence of adequate third-party payor coverage and reimbursement; ● effectiveness of our sales, marketing and distribution capabilities and the effectiveness of such capabilities of our collaborative partners, if any; and ● unfavorable publicity concerning our products or any similar products.
Anti-corruption laws are interpreted broadly 60 Table of Contents and prohibit companies and their employees, agents, and contractors, from authorizing, promising, offering, or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector.
Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, and contractors, from authorizing, promising, offering, or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector.
These risks include, among other things, the speed at which we can scale up operations, our complete dependence upon development of our product candidates that currently have no market acceptance, our ability to establish and expand our brand name, our ability to expand our operations to meet the commercial demand of our clients, our development of and reliance on strategic and customer relationships and our ability to minimize fraud and other security risks.
These risks include, among other things, the speed at which we can scale up operations, our complete dependence upon development of our product candidates that currently have no market acceptance, our ability to establish and expand our brand name, our development of and reliance on strategic and customer relationships and our ability to minimize fraud and other security risks.
During times of war and other major conflicts, including the war in Ukraine, we and the third parties upon which we rely may be vulnerable to a heightened risk of these attacks, including cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell and distribute our goods and services.
During times of war and other major conflicts, including the war in Ukraine and the conflict between Hamas and Israel, we and the third parties upon which we rely may be vulnerable to a heightened risk of these attacks, including cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell and distribute our goods and services.
For instance, the recently enacted Inflation Reduction Act imposes, among other rules, a 15% minimum tax on the book income of certain large corporations and a 1% excise tax on certain corporate stock repurchases. Further, existing tax laws, statutes, rules, regulations, or ordinances could be interpreted differently, changed, repealed, or modified at any time.
For instance, the recently enacted IRA imposes, among other rules, a 15% minimum tax on the book income of certain large corporations and a 1% excise tax on certain corporate stock repurchases. Further, existing tax laws, statutes, rules, regulations, or ordinances could be interpreted differently, changed, repealed, or modified at any time.
We rely and expect to continue to rely on third parties, including contract research organizations (“CROs”) and outside consultants, to conduct, supervise or monitor some or all aspects of preclinical studies and clinical trials 37 Table of Contents involving our product candidates.
We rely and expect to continue to rely on third parties, including contract research organizations (“CROs”) and outside consultants, to conduct, supervise or monitor some or all aspects of preclinical studies and clinical trials involving our product candidates.
Factors relating to our business that may contribute to these fluctuations include, among other factors described elsewhere in this Annual Report: ● our ability to obtain additional funding to develop our product candidates, the extent to which we are able to obtain such funding on favorable terms, and changes to our operations or strategy that may be necessitated due to the need for additional funding; ● our ability to conduct and complete preclinical studies, including GLP-compliant and IND-enabling preclinical studies; ● delays in the commencement, enrollment and timing of clinical trials; ● the success of our preclinical studies and clinical trials through all phases of development; ● any delays in regulatory review and approval of product candidates in clinical development; ● our ability to obtain and maintain regulatory approval for our product candidates in the United States and foreign jurisdictions; ● our ability to successfully commercialize product candidates for which we obtain regulatory approval, within expected timelines or at all; ● potential toxicity and/or side effects of our product candidates that could delay or prevent commercialization, limit the indications for any approved drug, require the establishment of risk evaluation and mitigation strategies (“REMS”), or cause an approved drug to be taken off the market; ● our ability to establish or maintain collaborations, licensing or other arrangements; ● market acceptance of our product candidates; ● competition from existing products, new products or new therapeutic approaches that may emerge; ● the ability of patients or healthcare providers to obtain coverage of or sufficient reimbursement for our products; ● our ability to leverage our in-licensed technology platform to discover and develop additional product candidates; ● our ability and our licensors’ abilities to successfully obtain, maintain, defend and enforce intellectual property rights important to our business; ● the impact of political instability, natural disasters, events of terrorism and wars, including Russia’s invasion of Ukraine; 36 Table of Contents ● the impact of other global and macroeconomic conditions, including rising inflation and interest rates, supply chain disruptions, fluctuating exchange rates, and increases in commodity, energy and fuel prices; and ● potential product liability claims.
Factors relating to our business that may contribute to these fluctuations include, among other factors described elsewhere in this Annual Report: ● our ability to obtain additional funding to develop our product candidates, the extent to which we are able to obtain such funding on favorable terms, and changes to our operations or strategy that may be necessitated due to the need for additional funding; ● our ability to conduct and complete preclinical studies, including GLP-compliant and IND-enabling preclinical studies; ● delays in the commencement, enrollment and timing of clinical trials; ● the success of our preclinical studies and clinical trials through all phases of development; ● any delays in regulatory review and approval of product candidates in clinical development; ● our ability to obtain and maintain regulatory approval for our product candidates in the United States and foreign jurisdictions; ● our ability to successfully commercialize product candidates for which we obtain regulatory approval, within expected timelines or at all; ● potential toxicity and/or side effects of our product candidates that could delay or prevent commercialization, limit the indications for any approved drug, require the establishment of risk evaluation and mitigation strategies (“REMS”), or comparable foreign strategies, or cause an approved drug to be taken off the market; ● our ability to establish or maintain collaborations, licensing or other arrangements; ● market acceptance of our product candidates; ● competition from existing products, new products or new therapeutic approaches that may emerge; ● the ability of patients or healthcare providers to obtain coverage of or sufficient reimbursement for our products; ● our ability to leverage our in-licensed technology platform to discover and develop additional product candidates; ● our ability and our licensors’ abilities to successfully obtain, maintain, defend and enforce intellectual property rights important to our business; 35 Table of Contents ● the impact of political instability, natural disasters, events of terrorism and wars, including Russia’s invasion of Ukraine and the conflict between Hamas and Israel; ● the impact of other global and macroeconomic conditions, including heightened inflation and high interest rates, liquidity concerns at and failures of banks and other financial institutions, supply chain disruptions, fluctuating exchange rates, and increases in commodity, energy and fuel prices; and ● potential product liability claims.
For studies that are conducted only at sites outside of the U.S. and not subject to an IND, the FDA requires the clinical trial to have been conducted in accordance with GCPs, and the FDA must be able to validate the data from the clinical trial through an on-site inspection if it deems such inspection necessary.
For studies that are conducted only at sites outside of the United States and not subject to an IND, the FDA requires the clinical trial to have been conducted in accordance with GCPs, and the FDA must be able to validate the data from the clinical trial through an on-site inspection if it deems such inspection necessary.
Mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated among a smaller number of competitors. Other companies may succeed in developing products earlier than us, obtaining FDA approval for products more rapidly, or developing products that are more effective than our product candidates.
Mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated among a smaller number of competitors. Other companies may succeed in developing products earlier than us, obtaining FDA or comparable foreign regulatory authority approval for products more rapidly, or developing products that are more effective than our product candidates.
Third-party manufacturers must be inspected by the FDA for cGMP compliance before they can produce commercial products. We may be in competition with other companies for access to these manufacturers’ facilities and may be subject to delays in manufacture if the manufacturers give other clients higher priority than they give to us.
Third-party manufacturers must be inspected by the FDA and comparable foreign regulatory authorities for cGMP compliance before they can produce commercial products. We may be in competition with other companies for access to these manufacturers’ facilities and may be subject to delays in manufacture if the manufacturers give other clients higher priority than they give to us.
If we, our collaborators, or our manufacturers fail to comply with applicable regulatory requirements at any stage during the regulatory process, such noncompliance could result in, among other things delays in the approval of applications or supplements to approved applications; refusal of a regulatory authority, including the FDA, to review pending market approval applications or supplements to approved applications; warning letters; fines; import and/or export restrictions; product recalls or seizures; injunctions; total or partial suspension of production; civil penalties; withdrawals of previously approved marketing applications or licenses; recommendations by the FDA or other regulatory authorities against governmental contracts; and/or criminal prosecutions.
If we, our collaborators, or our manufacturers fail to comply with applicable regulatory requirements at any stage during the regulatory process, such noncompliance could result in, among other things delays in the approval of applications or supplements to approved applications; refusal of a regulatory authority, including the FDA, to review pending market approval applications or supplements to approved applications; warning letters; fines; import and/or export restrictions; product recalls or seizures; injunctions; total or partial suspension of production, distribution, manufacturing or clinical trials; civil penalties; withdrawals, suspension or variation of previously approved marketing applications or licenses; recommendations by the FDA or comparable foreign other regulatory authorities against governmental contracts; and/or criminal prosecutions.
Although, to our knowledge, no third party has asserted a claim of infringement or other claim against us, others may hold or claim to hold proprietary or other rights that could prevent our SEE-Tx® platform from being developed or marketed.
Although, to our knowledge, no third party has asserted a claim of infringement or other claim against us, others may hold or claim to hold proprietary or other rights that could prevent our Magellan™ platform from being developed or marketed.
Certain data privacy and security obligations may require us to implement and maintain specific security measures, industry-standard or reasonable security measures to protect our information technology systems and sensitive information. While we have implemented security measures designed to protect against security incidents, there can be no assurance that these measures will be effective.
Certain data privacy and security obligations may require us to implement and maintain specific security measures, industry-standard or reasonable security measures to protect our information technology systems and sensitive information. While we and our third party services providers have implemented security measures designed to protect against security incidents, there can be no assurance that these measures will be effective.
Under applicable U.S. federal income tax law, our federal net operating loss, or NOL, carryforwards generated in tax years beginning on or before December 31, 2017, are only permitted to be carried forward for 20 years.
Under applicable U.S. federal income tax law, our federal NOL carryforwards generated in tax years beginning on or before December 31, 2017, are only permitted to be carried forward for 20 years.
The effects of competition, intellectual property disputes, market acceptance, and FDA regulations, among other factors described herein, preclude us from forecasting revenues or income with certainty or even confidence. Our business and operations may be adversely affected by health epidemics or pandemics.
The effects of competition, intellectual property disputes, market acceptance, and FDA and comparable foreign regulatory authority regulations, among other factors described herein, preclude us from forecasting revenues or income with certainty or even confidence. Our business and operations may be adversely affected by health epidemics or pandemics.
If we decide to pursue a Fast Track Designation for some of our product candidates, it may not lead to a faster development or regulatory review or approval process. We may seek Fast Track Designation for one or more of our product candidates.
If we decide to pursue a Fast Track Designation, or comparable foreign regulatory procedures, for some of our product candidates, it may not lead to a faster development or regulatory review or approval process. We may seek Fast Track Designation, or comparable foreign regulatory procedures, for one or more of our product candidates.
Our research coverage by industry and financial analysts is currently limited. Even if our analyst coverage increases, if one or more of the analysts who cover us downgrade our stock, our stock price would likely decline.
Our research coverage by industry and financial analysts is currently limited. Even if our analyst coverage increases, if one or more of the analysts who cover us downgrade our 71 Table of Contents stock, our stock price would likely decline.
Conducting clinical trials outside the U.S. also exposes us to additional risks, including risks associated with: ● additional foreign regulatory requirements; ● foreign exchange fluctuations; ● compliance with foreign manufacturing, customs, shipment and storage requirements; ● cultural differences in medical practice and clinical research; and ● diminished protection of intellectual property in some countries.
Conducting clinical trials outside the United States also exposes us to additional risks, including risks associated with: ● additional foreign regulatory requirements; ● foreign exchange fluctuations; ● compliance with foreign manufacturing, customs, shipment and storage requirements; ● cultural differences in medical practice and clinical research; and ● diminished protection of intellectual property in some countries.
In particular, changes in corporate tax rates, the realization of our net deferred tax assets, the taxation of foreign earnings, and the deductibility of expenses under the Tax Act, as amended by the Coronavirus Aid, Relief, and 67 Table of Contents Economic Security Act or any future tax reform legislation, could have a material impact on the value of our deferred tax assets, result in significant one-time charges, and increase our future tax expenses.
In particular, changes in corporate tax rates, the realization of our net deferred tax assets, the taxation of foreign earnings, and the deductibility of expenses under the Tax Cuts and Jobs Act, as amended by the Coronavirus Aid, Relief, and Economic Security Act or any future tax reform legislation, could have a material impact on the value of our deferred tax assets, result in significant one-time charges, and increase our future tax expenses.
We have concentrated our efforts and research and development activities on our novel small molecules for potential treatment of rare and genetic diseases caused by protein misfolding and SEE-Tx®, our target identification platform.
We have concentrated our efforts and research and development activities on our novel small molecules for potential treatment of rare and genetic diseases caused by protein misfolding and Magellan™, our target identification platform.
A failure of any of our third-party manufacturers to establish and follow cGMP requirements and to document their adherence to such practices may lead to significant delays in the availability of material for clinical trials, may delay or prevent filing or approval of marketing applications for our products, and may cause delays or interruptions in the availability of our products for commercial distribution following FDA approval.
A failure of any of our third-party manufacturers to establish and follow cGMP requirements and to document their adherence to such practices may lead to significant delays in the availability of material for clinical trials, may delay or prevent filing or approval of marketing applications for our products, and may cause delays or interruptions in the availability of our products for commercial distribution following approval by the FDA or a comparable foreign regulatory authority.
If the FDA does not accept data from our clinical trials of our product candidates conducted outside of the U.S., it would likely result in the need for additional clinical trials, which would be costly and time consuming and delay or permanently halt our development of our product candidates.
If the FDA does not accept data from our clinical trials of our product candidates conducted outside of the United States, it would likely result in the need for additional clinical trials, which would be costly and time consuming and delay or permanently halt our development of our product candidates.
We have limited experience as a company conducting clinical trials and may be unable to complete pivotal clinical trials for any product candidates we may develop. We are not yet a clinical stage company and our success is dependent upon our ability to initiate and successfully complete clinical trials and obtain regulatory approval for and commercialization of our product candidates.
We have limited experience as a company conducting clinical trials and may be unable to complete pivotal clinical trials for any product candidates we may develop. Our success is dependent upon our ability to initiate and successfully complete clinical trials and obtain regulatory approval for and commercialization of our product candidates.
Until recently, our operations have been limited primarily to organizing and staffing our company, expanding its operations, performing research, acquiring, developing and securing our in-licensed technology and preclinical development of our product candidates.
Our operations to date have been primarily limited to organizing and staffing our company, expanding its operations, performing research, acquiring, developing and securing our in-licensed technology and preclinical development of our product candidates.
Despite our efforts, there is a risk that we will not be able to conclude, within the prescribed timeframe or at all, that our internal control over financial 66 Table of Contents reporting is effective as required by Section 404.
Despite our efforts, there is a risk that we will not be able to conclude, within the prescribed timeframe or at all, that our internal control over financial reporting is effective as required by Section 404.
These consequences may include, but are not limited to, government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar); litigation (including class-related claims); additional reporting requirements and/or oversight; bans on processing personal information; orders to destroy or not use personal information; and imprisonment of company officials.
These consequences may include, but are not limited to, government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar); litigation (including class actions) and mass arbitration demands; additional reporting requirements and/or oversight; bans on processing personal information; orders to destroy or not use personal information; and imprisonment of company officials.
While we believe that our existing cash, cash equivalents and marketable securities will enable us to fund our operating expenses and capital expenditure requirements into the second quarter of 2024, we have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner 45 Table of Contents than we expect, including if our business or operations change in a manner that consumes available resources more rapidly than we anticipate.
While we believe that our existing cash, cash equivalents and marketable securities will enable us to fund our operating expenses and capital expenditure requirements into the first quarter of 2025, 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, including if our business or operations change in a manner that consumes available resources more rapidly than we anticipate.
Bribery Act 2010 and similar anti-bribery and anticorruption laws in other jurisdictions; ● business interruptions resulting from geopolitical actions, including war (such as Russia’s invasion of Ukraine) and terrorism, or natural disasters including earthquakes, hurricanes, floods and fires, economic or political instability, sanctions, or public health emergencies, such as the novel COVID-19 coronavirus and related shelter-in-place orders, travel, social distancing and quarantine policies, boycotts, curtailment of trade and other business restrictions; and ● difficulty in importing and exporting clinical trial materials and study samples.
Bribery Act 2010 and similar anti-bribery and anticorruption laws in other jurisdictions; ● business interruptions resulting from geopolitical actions, including war (such as Russia’s invasion of Ukraine and the conflict between Hamas and Israel) and terrorism, or natural disasters including earthquakes, hurricanes, floods and fires, economic or political instability, sanctions, or public health emergencies, and related shelter-in-place orders, travel, social distancing and quarantine policies, boycotts, curtailment of trade and other business restrictions; and ● difficulty in importing and exporting clinical trial materials and study samples.
To obtain FDA approval to market a new pharmaceutical product, we must demonstrate proof of safety and effectiveness in humans. To meet these requirements, we must conduct “adequate and well controlled” clinical trials. Conducting clinical trials is a lengthy, time-consuming, and expensive process.
To obtain FDA or comparable foreign regulatory authority approval to market a new pharmaceutical product, we must demonstrate proof of safety and effectiveness in humans. To meet these requirements, we must conduct “adequate and well controlled” clinical trials. Conducting clinical trials is a lengthy, time-consuming, and expensive process.
None of our product candidates have been determined to be safe and effective, and we have not submitted an IND or an NDA to the FDA or an equivalent application to any foreign regulatory authorities for any of our product candidates. 43 Table of Contents It is possible that none of our product candidates will be approved for marketing.
None of our product candidates have been determined to be safe and effective, and we have not submitted an NDA to the FDA or an equivalent application to any comparable foreign regulatory authorities for any of our product candidates. It is possible that none of our product candidates will be approved for marketing.
In particular, ransomware attacks, including by organized criminal threat actors, nation-states, and nation-state-supported actors, are becoming increasingly prevalent and severe and can lead to significant interruptions in our operations, loss of data and income, reputational harm, and diversion of funds.
In particular, ransomware attacks, including by organized criminal threat actors, nation-states, and nation-state-supported actors, are becoming increasingly prevalent and severe and can lead to significant interruptions in our operations, ability to provide our products or services, loss of data and income, reputational harm, and diversion of funds.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe lease in a multi-tenant building 2,992 square feet of office space in Via Soave n.6, Lugano Switzerland that we use for our general management team, research and administrative activities. This lease expires in May 2026.
Biggest changeWe lease in a multi-tenant building 2,992 square feet of office space in Via Soave n.6, Lugano Switzerland that we use for our research and development team and finance and administrative activities. This lease expires in May 2026.
ITEM 2. PROPERTIES Our principal executive office is located in Bethesda, Maryland, where we lease in a multi-tenant building 1,568 square feet of office space that we use for our administrative, investor relations and business developments and other activities. This lease expires in September 2024.
ITEM 2. PROPERTIES Our principal executive office is located in Bethesda, Maryland, where we lease in a multi-tenant building 1,568 square feet of office space that we use for our general management, investor relations, business developments and other activities. This lease expires in September 2024.
We lease in a multi-tenant building 1,417 square feet of office space in Torre D Building in the Parc Cientific de Barcelona, Spain that we use for our general management and research activities. This lease expires in November 2026.
We lease in a multi-tenant building 1,417 square feet of office space in Torre D Building in the Parc Cientific de Barcelona, Spain that we use for our drug discovery and research activities. This lease expires in November 2026.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThis number does not reflect the beneficial holders of our common stock for whom shares are held in “nominee” or “street” name through brokerage accounts or other nominees. Dividends We have never declared or paid cash dividends on our share capital, and we do not currently intend to pay any cash dividends on our share capital in the foreseeable future.
Biggest changeThis number does not reflect the beneficial holders of our common stock for whom shares are held in “nominee” or “street” name through brokerage accounts or other nominees. 74 Table of Contents Dividends We have never declared or paid cash dividends on our share capital, and we do not currently intend to pay any cash dividends on our share capital in the foreseeable future.
Any future determination related to dividend policy will be made at the discretion of our board of directors, subject to applicable laws, and will depend 70 Table of Contents upon, among other factors, our results of operations, financial condition, contractual restrictions, and capital requirements.
Any future determination related to dividend policy will be made at the discretion of our board of directors, subject to applicable laws, and will depend upon, among other factors, our results of operations, financial condition, contractual restrictions, and capital requirements.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information and Holders Our common stock trades on the Nasdaq Global Market (the "Nasdaq") under the trading symbol "GANX." As of February 28, 2023, there were approximately 64 holders of record of our common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information and Holders Our common stock trades on the Nasdaq Global Market (the "Nasdaq") under the trading symbol "GANX." As of February 29, 2024, there were approximately 66 holders of record of our common stock.

Item 6. [Reserved]

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

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Biggest changeItem 6. Selected Financial Data 71 ​ ​ ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 71 ​ ​ ​ Item 7A. Quantitative and Qualitative Disclosures about Market Risk 81 ​ ​ ​ Item 8. Financial Statements and Supplementary Data 82 ​ ​ ​
Biggest changeItem 6. Selected Financial Data 75 ​ ​ ​ Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 75 ​ ​ ​ Item 7A. Quantitative and Qualitative Disclosures about Market Risk 85 ​ ​ ​ Item 8. Financial Statements and Supplementary Data 86 ​ ​ ​

Item 7. Management's Discussion & Analysis

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

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Biggest changeConsolidated Results of Operations Comparison of the Years Ended December 31, 2022 and 2021 The following table summarizes our results of operations for the periods indicated, together with the changes in those items in dollars. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ ​ ​ ​ ​ ​ ​ Increase ​ 2022 ​ 2021 ​ (Decrease) Revenues: ​ ​ ​ Collaborative Agreements ​ 132,640 ​ ​ 133,928 ​ ​ (1,288) Other income 7,468 ​ 31,066 ​ (23,598) Total revenues $ 140,108 ​ $ 164,994 ​ $ (24,886) ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating expenses: ​ ​ ​ ​ Research and development (8,377,290) ​ (7,164,229) ​ 1,213,061 General and administrative (9,539,863) ​ (6,826,938) ​ 2,712,925 Total operating expenses $ (17,917,153) ​ $ (13,991,167) ​ $ 3,925,986 ​ ​ ​ ​ ​ ​ ​ ​ ​ Loss from operations $ (17,777,045) ​ $ (13,826,173) ​ $ 3,950,872 ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest income, net 375,357 ​ 12,495 ​ 362,862 Foreign exchange loss, net (96,074) ​ (72,920) ​ (23,154) Loss before income tax $ (17,497,762) ​ $ (13,886,598) ​ $ 3,611,164 ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax (92,976) ​ (4,008) ​ 88,968 Net loss $ (17,590,738) ​ $ (13,890,606) ​ $ 3,700,132 ​ ​ ​ ​ ​ ​ ​ ​ ​ Net loss per ordinary share: ​ ​ ​ Basic and diluted loss per share (1.48) ​ (1.37) ​ 0.11 Weighted-average common stock used in per share calculations – basic and diluted 11,883,368 ​ 10,165,404 ​ ​ ​ 75 Table of Contents Comparison of the Years ended December 31, 2022 and 2021 Revenues For the years ended December 31, 2022 and 2021, total revenues were $140,108 and $164,994, respectively and consisted mainly of revenues from a collaboration agreement and other income related to subleasing our Lugano office space.
Biggest changeOther Financial Income (Expense) Other financial income (expense) consists of interest income, interest expense and foreign exchange gain or loss, net. 79 Table of Contents Consolidated Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 The following table summarizes our results of operations for the periods indicated, together with the changes in those items. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ ​ ​ ​ ​ ​ ​ Increase ​ 2023 ​ 2022 ​ (Decrease) Revenues: ​ ​ ​ Collaborative Agreements ​ 55,180 ​ ​ 132,640 ​ ​ (77,460) Other income — ​ 7,468 ​ (7,468) Total revenues $ 55,180 ​ $ 140,108 ​ $ (84,928) ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating expenses: ​ ​ ​ ​ Research and development (11,520,613) ​ (8,377,290) ​ 3,143,323 General and administrative (10,787,700) ​ (9,539,863) ​ 1,247,837 Total operating expenses $ (22,308,313) ​ $ (17,917,153) ​ $ 4,391,160 ​ ​ ​ ​ ​ ​ ​ ​ ​ Loss from operations $ (22,253,133) ​ $ (17,777,045) ​ $ 4,476,088 ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest income, net 494,234 ​ 375,357 ​ 118,877 Foreign exchange loss, net (429,346) ​ (96,074) ​ (333,272) Loss before income tax $ (22,188,245) ​ $ (17,497,762) ​ $ 4,690,483 ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax (79,275) ​ (92,976) ​ (13,701) Net loss $ (22,267,520) ​ $ (17,590,738) ​ $ 4,676,782 ​ ​ ​ ​ ​ ​ ​ ​ ​ Net loss per ordinary share: ​ ​ ​ Basic and diluted loss per share (1.71) ​ (1.48) ​ 0.23 Weighted-average common stock used in per share calculations – basic and diluted 13,011,361 ​ 11,883,368 ​ ​ ​ Comparison of the Years ended December 31, 2023 and 2022 Revenues For the years ended December 31, 2023 and 2022, total revenues were $55 thousand and $140 thousand, respectively, and consisted mainly of income from a collaboration agreement with Zentalis Pharmaceuticals.
If we are unable to obtain funding, we could be required to delay, limit, reduce or eliminate research and development programs, product portfolio expansion or future commercialization efforts, or grant rights to develop and market our product candidates even if we would otherwise prefer to develop and market such candidates ourselves, which could adversely affect our business prospects.
If we are unable to obtain funding, we could be required to delay, limit, reduce or eliminate research and development programs, product portfolio expansion or future commercialization efforts, or grant rights to develop, sell and market our product candidates even if we would otherwise prefer to develop and market such product candidates ourselves, which could adversely affect our business prospects.
Share-based compensation We recognize compensation costs related to equity based compensation granted to employees, consultants and directors, based on the estimated fair value of the awards as of the grant date. We estimate the grant date fair value, and the resulting share-based compensation, using the Black-Scholes option-pricing model.
Share-based compensation We recognize compensation costs related to share based compensation granted to employees, consultants and directors, based on the estimated fair value of the awards as of the grant date. We estimate the grant date fair value, and the resulting share-based compensation, using the Black-Scholes option-pricing model.
We will remain an emerging growth company until the earliest of (i) the last day of our first fiscal year in which we have total annual gross revenue of $1.07 billion or more, (ii) December 31, 2026, (iii) the date on which we 80 Table of Contents have issued more than $1.0 billion of non-convertible debt instruments during the previous three fiscal years or (iv) the date on which we are deemed a “large accelerated filer” under the rules of the SEC with at least $700 million of outstanding equity securities held by non-affiliates.
We will remain an emerging growth company until the earliest of (i) the last day of our first fiscal year in which we have total annual gross revenue of $1.07 billion or more, (ii) December 31, 2026, (iii) the date on which we have issued more than $1.0 billion of non-convertible debt instruments during the previous three fiscal years or (iv) the date on which we are deemed a “large accelerated filer” under the rules of the SEC with at least $700 million of outstanding equity securities held by non-affiliates.
Our future funding requirements will depend on many factors, including, but not limited to: ● the scope, timing, progress and results of discovery, preclinical development, laboratory testing and clinical trials for our product candidates; ● the extent to which we enter into collaborations or other arrangements with additional third parties in order to further develop our product candidates; ● the extent to which we encounter increased costs as a result of global and macroeconomic conditions, including heightened inflation and rising interest rates, supply chain disruptions, fluctuating exchange rates, and increases in commodity, energy and fuel prices ; ● the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims; ● the costs and fees associated with the discovery, acquisition or in-license of additional product candidates or technologies; ● our ability to establish additional collaborations on favorable terms, if at all; ● the costs required to scale up our clinical, regulatory and manufacturing capabilities; ● the costs of manufacturing our product candidates for clinical trials and in preparation for marketing approval and commercialization; 78 Table of Contents ● the costs of future commercialization activities, if any, including establishing sales, marketing, manufacturing and distribution capabilities, for any of our product candidates for which we receive marketing approval; and ● revenue, if any, received from commercial sales of our product candidates, should any of our product candidates receive marketing approval.
Our future funding requirements will depend on many factors, including, but not limited to: ● the scope, timing, progress and results of discovery, preclinical development, laboratory testing and clinical trials for our product candidates; ● the extent to which we enter into collaborations or other arrangements with additional third parties in order to further develop our product candidates; ● the extent to which we encounter increased costs as a result of global and macroeconomic conditions, including heightened inflation and high interests rates, supply chain disruptions, fluctuating exchange rates, and increases in commodity, energy and fuel prices; ● the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending intellectual property-related claims; ● the costs and fees associated with the discovery, acquisition or in-license of additional product candidates or technologies; ● our ability to establish additional collaborations on favorable terms, if at all; ● the costs required to scale up our clinical, regulatory and manufacturing capabilities; ● the costs of manufacturing our product candidates for clinical trials and in preparation for marketing approval and commercialization; ● the costs of future commercialization activities, if any, including establishing sales, marketing, manufacturing and distribution capabilities, for any of our product candidates for which we receive marketing approval; and ● revenue, if any, received from commercial sales of our product candidates, should any of our product candidates receive marketing approval.
If we raise funds through collaborations, or other similar arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock.
If we raise funds 81 Table of Contents through collaborations, or other similar arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock.
We anticipate that our research and development expenses will increase substantially in future periods to support progress in our research and development activities, including the commencement of the clinical trials for product candidates we are developing. These increases will likely also result from increased headcount, expanded infrastructure and increased insurance costs.
We anticipate that our research and development expenses will increase substantially in future periods to support progress in our research and development activities, including the progressing of the clinical trials for product candidates we are developing. These increases will likely also result from expanded infrastructure and increased insurance costs.
Until such time, if ever, as we can generate substantial product revenue, we expect to finance our operations through a combination of equity offerings, debt financings, government or private party grants, collaborations, strategic alliances and licensing arrangements.
Until such time, if ever, as we can generate substantial product revenue, we expect to finance our operations through a combination of equity offerings, including at-the-market offerings, debt financings, government or private party grants, collaborations, strategic alliances and licensing arrangements.
We make estimates of our accrued expenses as of each balance sheet date based on facts and 79 Table of Contents circumstances known to us at that time at the date of the preparation of the financial statements.
We make estimates of our accrued expenses as of each balance sheet date based on facts and circumstances known to us at that time at the date of the preparation of the financial statements.
We have incurred recurring losses and negative cash flows from operations since inception and as of December 31, 2022 and December 31, 2021, had an accumulated deficit of $38.5 million and $20.9 million, respectively. We anticipate incurring additional losses until such time, if ever, that we can generate sales of our product candidates currently in development.
We have incurred recurring losses and negative cash flows from operations since inception and as of December 31, 2023 and December 31, 2022, had an accumulated deficit of $60.8 million and $38.5 million, respectively. We anticipate incurring additional losses until such time, if ever, that we can generate sales of our product candidates currently in development.
We may not be able to obtain additional funds through equity or debt financings when needed on favorable terms or at all, including as a result of rising interest rates, volatility in the capital markets and related market uncertainty.
We may not be able to obtain additional funds through equity or debt financings when needed on favorable terms or at all, including as a result of rising interest rates, liquidity concerns at, and failures of, banks and other financial institutions, volatility in the capital markets and related market uncertainty.
Operating Expenses Our expenses since inception have consisted solely of research and development costs and general and administrative costs. 73 Table of Contents Research and Development Expenses Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts, and the development of our product candidates, which include: ● expenses incurred under collaborations with third parties, including contract research organizations (“CROs”) and Universities, that conduct research and preclinical studies, such as in-vitro and in-vivo absorption, distribution, metabolism and excretion (“ADME”), cell model studies, in-vivo pharmacology and pharmacokinetic studies, toxicology studies and chemical synthesis, stability studies, manufacturing and control materials, process characterization, scale-up and transfer, on our behalf; ● employee salaries, benefits and other related costs, including share-based compensation expenses, for employees engaged in research and development functions and overhead allocations consisting of various support and facilities-related expenses, which include rent, utilities and maintenance of our Barcelona labs and Lugano office space, depreciation, travel and conference expenses; ● fees paid to consultants who assist with research and development activities and related travel expenses; and ● the cost of sponsored research, which includes laboratory materials and supplies, manufacturing scale-up expenses and the cost of acquiring and manufacturing preclinical studies.
Research and Development Expenses Research and development expenses consist primarily of costs incurred for our research activities, including our discovery efforts, and the development of our product candidates, which include: ● expenses incurred under collaborations with third parties, including contract research organizations (“CROs”) and Universities, that conduct research, preclinical and clinical studies, such as in-vitro and in-vivo absorption, distribution, metabolism and excretion (“ADME”), cell model studies, in-vivo pharmacology and pharmacokinetic studies, toxicology studies and chemical synthesis, stability studies, manufacturing and control materials, process characterization, scale-up and transfer, clinical trial expenses, on our behalf; ● employee salaries, benefits and other related costs, including share-based compensation expenses, for employees engaged in research and development functions and overhead allocations consisting of various support and facilities-related expenses, which include rent, utilities and maintenance of our facilities, depreciation, travel and conference expenses; ● fees paid to consultants who assist with research and development activities and related travel expenses; and ● the cost of sponsored research, which includes laboratory materials and supplies, manufacturing scale-up expenses and the cost of acquiring and manufacturing preclinical studies.
The war in Ukraine, global geopolitical tension, and COVID-19 pandemic continue to have unpredictable impacts on global societies, economies, financial markets, and business practices.
The war in Ukraine, the conflict between Hamas and Israel, global geopolitical tension, and the post COVID-19 environment continue to have unpredictable impacts on global societies, economies, financial markets, and business practices.
As of December 31, 2022, and 2021, we had $22.1 million and $36.9 million in cash and cash equivalents and marketable securities, respectively, and an accumulated deficit of $38.5 million and $20.9 million, respectively. We had indebtedness of $0.60 million and $0.69 million as of December 31, 2022 and 2021, respectively.
As of December 31, 2023, and December 31, 2022, we had $16.8 million and $22.1 million in cash and cash equivalents and marketable securities, respectively, and an accumulated deficit of $60.8 million and $38.5 million, respectively. We had indebtedness of $0.56 million and $0.60 million as of December 31, 2023 and December 31, 2022, respectively.
As of December 31, 2022, the Company has not sold any shares of common stock pursuant to the Sales Agreement. ​ Until such time, if ever, as we can generate substantial product revenues to support our business and corporate strategy, we expect to finance our cash needs through a combination of public and private equity offerings, debt financings, government or private party grants, collaborations, strategic alliances and licensing arrangements.
Until such time, if ever, as we can generate substantial product revenues to support our business and corporate strategy, we expect to finance our cash needs through a combination of public and private equity offerings, debt financings, at-the-market offerings, government or private party grants, collaborations, strategic alliances, and licensing arrangements.
If we fail to complete the development of our product candidates in a timely manner or fail to obtain their regulatory approval and successfully commercialize them, we will not generate revenues in the future. Our current revenue consists primarily of revenue from our Zentalis collaboration arrangement.
If we fail to complete the development of our product candidates in a timely manner or fail to obtain their regulatory approval and successfully commercialize them, we will not generate 77 Table of Contents revenues in the future.
As a result, we expect that our research and development expenses will continue to increase in the foreseeable future as we (i) increase personnel costs, including stock-based compensation, (ii) continue preclinical development of our lead compounds, (iii) initiate clinical trials for certain product candidates, (iv) continue to discover and develop additional product candidates, and (v) pursue later stages of clinical development of product candidates. 74 Table of Contents General and Administrative Expenses General and administrative expenses consist primarily of salaries, bonus and other related costs, including share-based compensation, for personnel in our executive, finance, corporate and business development and administrative functions.
As a result, we expect that our research and development expenses will continue to increase in the foreseeable future as we (i) increase personnel costs, including stock-based compensation, (ii) continue preclinical development of our lead compounds, (iii) progress our clinical trials for certain product candidates, (iv) continue to discover and develop additional product candidates, and (v) pursue later stages of clinical development of product candidates.
We have not generated any product revenues and have not achieved profitable operations. There is no assurance that profitable operations will ever be achieved, and, if achieved, could be sustained on a continuing basis. In addition, we will need significant additional financing to fund our operations and to develop our product candidates.
We have not generated any product revenues and have not achieved profitable operations. There is no assurance that profitable operations will ever be achieved, and, if achieved, could be sustained on a continuing basis.
Cash Used in Investing Activities During the year ended December 31, 2022, cash used in investing activities was $14,775 thousand, primarily due to the purchase of marketable securities for $17,735 thousand and the purchase of computers and equipment for $119 thousand, offset by $3,079 thousand attributable to maturity of marketable securities.
During the year ended December 31, 2022, cash used in investing activities was $14.7 million, primarily due to purchase of marketable securities for $17.7 million, partially offset by the maturity of marketable securities for $3 million.
We expect to continue to identify and evaluate collaboration, co-development and licensing opportunities that may be similar to or different from the collaboration and licenses arrangements that we have entered into. Collaboration with Zentalis On April 20, 2021, we entered into a multi-target collaboration agreement, or the Zentalis Agreement, with Zentalis Pharmaceuticals, Inc.
We expect to continue to identify and evaluate collaboration, co-development and licensing opportunities that may be similar to or different from the collaboration and licenses arrangements that we have entered into.
On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses, defined benefit pension liability, share-based compensation and recognition of research grants. Our actual results may differ from these estimates under different assumptions or conditions. During the year ended December 31, 2022, there were no material changes to our critical accounting policies.
On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses, defined benefit pension liability, share-based compensation, recognition of research grants 83 Table of Contents and the going concern assessment. Our actual results may differ from these estimates under different assumptions or conditions.
General and administrative expenses also include legal fees relating to patent and corporate matters, professional fees for accounting, auditing, tax and consulting services, insurance costs, travel expenses, and facility-related expenses, and other operating costs.
General and administrative expenses also include legal fees relating to patent and corporate matters, professional fees for accounting, auditing, tax and consulting services, insurance costs, travel expenses, and facility-related expenses, and other operating costs. We will continue to focus on preserving our liquidity resources while we seek to maximize shareholders’ value.
Certain assumptions used in our Black-Scholes option-pricing model represent management’s best estimates and involve a number of assumptions and the application of management’s judgment, as they are inherently subjective. Research Grants Under the terms of the research and development grants awarded, we are entitled to receive reimbursement of our allowable direct expenses.
Certain assumptions used in our Black-Scholes option-pricing model represent management’s best estimates and involve a number of assumptions and the application of management’s judgment, as they are inherently subjective.
We have not yet commercialized any products or technologies, and we do not expect to generate revenue from sales of any products in the near term, if at all. We have funded our operations to date primarily through a combination of sales of our securities and research grants.
We have not yet received approval for or commercialized any products or technologies, and we do not expect to generate revenue from sales of any products in the near term, if at all.
Because of the numerous risks and uncertainties associated with research, development and commercialization of pharmaceutical products, we are unable to estimate the exact amount of our operating capital requirements.
Funding Requirements Our primary use of cash is to fund our operating expenses, which consist of research and development and general and administrative expenditures. 82 Table of Contents Because of the numerous risks and uncertainties associated with research, development and commercialization of pharmaceutical products, we are unable to estimate the exact amount of our operating capital requirements.
Cash Flows The following table provides information regarding our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 31, ​ 2022 ​ 2021 ​ ​ ​ Cash used in operating activities $ (14,692,139) ​ $ (12,365,670) Cash used in investing activities (14,774,813) ​ (94,212) Cash (used) / provided by financing activities (78,774) ​ 41,766,775 Net (decrease) / increase in cash, cash equivalents and restricted cash $ (29,569,523) ​ $ 29,407,671 ​ Cash Used in Operating Activities During the year ended December 31, 2022, we used $14,692 thousand of cash in operating activities, primarily to fund our operations related to the development of our product candidates and related general and administrative support activities.
Cash Flows The following table provides information regarding our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 31, ​ 2023 ​ 2022 ​ ​ ​ Cash used in operating activities $ (18,865,873) ​ $ (14,692,139) Cash provided/(used) by/in investing activities 10,222,667 ​ (14,774,813) Cash provided/(used) by/in financing activities 12,641,343 ​ (78,774) Effect of exchange rate changes ​ 488,404 ​ ​ (23,797) Net increase / (decrease) in cash, cash equivalents and restricted cash $ 4,486,541 ​ $ (29,569,523) ​ Cash Used in Operating Activities During the year ended December 31, 2023 and 2022, we used $18.9 million and $14.7 million of cash, respectively, in operating activities, primarily to fund our operations related to the development of our product candidates and related general and administrative support activities.
Contributions from research and development activities under the grants are recorded based on management’s best estimate of the periods in which the related expenditures are incurred and activities performed and are classified in the statement of operations as a reduction to research and development expenses. JOBS Act We qualify as an “emerging growth company”, as defined in the JOBS Act.
Such expenses are offset by contributions from research grants, which are recorded as a reduction to research and development expenses based on our best estimate of the periods in which the related expenditures are incurred and activities performed.
In May 2022, we filed a shelf registration statement on Form S-3, which covers the offering, issuance and sale of up to a maximum aggregate offering price of $100.0 million of any combination of our common stock, preferred 76 Table of Contents stock, debt securities and/or warrants from time to time in one or more offerings (the “Shelf Registration Statement”).
In May 2022, we filed a shelf registration statement on Form S-3, which covers the offering, issuance and sale of up to a maximum aggregate offering price of $100.0 million of any combination of our common stock, preferred stock, debt securities and/or warrants from time to time in one or more offerings (the “Shelf Registration Statement”). ​ In May 2022, we entered into a Controlled Equity OfferingSM Sales Agreement, or Sales Agreement, with Cantor Fitzgerald & Co., or Cantor, pursuant to which we were able to offer and sell shares of our common stock having an aggregate offering price of up to $16.0 million from time to time through or to Cantor, acting as our agent or principal, in a series of one or more at-the-market equity offerings, which we refer to as our ATM Program.
From inception through December 31, 2022, we have raised an aggregate of $60 million of gross proceeds through the issuance of convertible preferred stock and our IPO. As of December 31, 2022, we had cash, cash equivalents and marketable securities of $22.1 million. For the year ended December 31, 2022, we had cash outflows from operations of $14.7 million.
From inception through December 31, 2023, we have raised an aggregate of $74 million of gross proceeds through equity financings, including the issuance of convertible preferred stock, our IPO and sales under our ATM Program. As of December 31, 2023, we had cash, cash equivalents and marketable securities of $16.8 million.
Financing Requirements; Current Financing Environment Until such time, if ever, as we can generate substantial product revenues to support our cost structure, we expect to seek additional funding through a combination of public or private equity offerings, debt financings, government or private party grants, collaborations, strategic alliances and licensing arrangements.
Investors should read the section below titled “Liquidity and Capital Resources” for additional information regarding our financial condition and ability to continue operations. ​ Financing Requirements; Current Financing Environment Until such time, if ever, as we can generate substantial product revenues to support our business and corporate strategy, we expect to finance our cash needs through a combination of public and private equity offerings, including an at-the-market offering, debt financings, government or private party grants, collaborations, strategic alliances and licensing arrangements.
The increase is due to higher taxable profit realized by our Spanish subsidiary as a consequence of the allocation of non deductible tax expenses. Liquidity and Capital Resources Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations.
Liquidity and Capital Resources Since our inception, we have not generated any revenue from product sales and have incurred significant operating losses and negative cash flows from our operations.
The following table provides a breakout of our research and development expenses by major categories of expense: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ 2022 ​ 2021 ​ Change Pre-clinical activities and outside services 5,192,868 ​ 4,849,576 ​ ​ 343,292 Personnel expenses 2,969,038 ​ 2,223,585 ​ ​ 745,453 Other 297,517 ​ 275,816 ​ ​ 21,701 Research grants (82,133) ​ (184,748) ​ ​ 102,615 Total research and development expenses $ 8,377,290 ​ $ 7,164,229 ​ $ 1,213,061 ​ We recognize research and development costs as incurred.
The following table provides a breakout of our research and development expenses by major categories of expense: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ 2023 ​ 2022 ​ Change Pre-clinical activities, clinical activities and outside services 7,535,538 ​ 5,192,868 ​ ​ 2,342,670 Personnel expenses 3,956,187 ​ 2,969,038 ​ ​ 987,149 Other 628,958 ​ 297,517 ​ ​ 331,441 Research grants (600,070) ​ (82,133) ​ ​ (517,937) Total research and development expenses $ 11,520,613 ​ $ 8,377,290 ​ $ 3,143,323 ​ We recognize research and development costs as incurred.
As of December 31, 2022, the Company has not sold any shares of common stock pursuant to the Sales Agreement. ​ Strategic Transactions; Collaboration and Licensing Arrangement In connection with our business development activities, we enter into collaborative and licensing arrangement with third parties, to use our licensed SEE-Tx® computational platform technology to discover novel allosteric sites on misfolded proteins and identify proprietary small molecules that bind these sites, potentially restoring protein folding and treating disease.
Strategic Transactions; Collaboration and Licensing Arrangement In connection with our business development activities, we enter into collaboration and licensing arrangements with third parties, to use our licensed Magellan™ computational platform technology to discover novel allosteric sites on proteins and identify proprietary small molecules that bind these sites and may be developed into pharmaceutical products.
General and Administrative Expenses General and administrative expenses increased by $2,712,925 to $9,539,863 for the year ended December 31, 2022 from $6,826,938 for the year ended December 31, 2021.
General and Administrative Expenses General and administrative expenses increased by $1.3 million to $10.8 million for the year ended December 31, 2023 from $9.5 million for the year ended December 31, 2022.
During the year ended December 31, 2021, cash used in investing activities was $94 thousand primarily due to purchases of furniture, computers and lab instruments. Cash Used/Provided by Financing Activities During the year ended December 31, 2022, cash used by financing activities was $79 thousand related to the payment of the current portion of a long-term loan.
During the year ended December 31, 2022, cash used in financing activities was $78 thousand, reflecting the payment of current portion of long-term debt.
We have generated an extensive preclinical data package providing evidence of the mechanism of action and effect of our lead product candidate GT-02287 for the treatment of GBA1 Parkinson’s disease, including restoration of GCase function, reduction of toxic lipid substrates and toxic forms of alpha-synuclein, improved survival of dopaminergic neurons, and increase of dopamine levels and improved locomotor function in animal models.
GT-02287 - our lead product candidate: for the treatment of GBA1 Parkinson’s disease and other synucleinopathies Our clinical stage product candidate, GT-02287, is being developed for the treatment of GBA1 Parkinson’s disease. We have generated an extensive preclinical data package providing evidence of the mechanism of action and safety of GT-02287.
We may not be able to obtain additional funds through equity or debt financings when needed on favorable terms or at all, including as a result of rising interest rates, recent and potential future bank failures, volatility in the capital markets and related market uncertainty.
We may not be able to obtain additional funds through equity or debt financings when needed on favorable terms or at all. See “Financing Requirements; Current Financing Environment” and “Liquidity and Capital Resources”.
Our primary research and development focus since inception has been the application of our in-licensed SEE-Tx® platform to various indications and targets. We are using our platform to generate a broad pipeline of product candidates. Research and development activities are central to our business model.
Our primary research and development focus since inception has been the application of our Magellan™ platform to various indications and targets, and more recently the development of our clinical stage lead product candidate GT-02287 for the treatment of Parkinson’s diseae and other neurodegenerative diseases. 78 Table of Contents Research and development activities are central to our business model.
We plan to conduct the Phase 1 clinical trial in Australia and evaluate administration of both single and multiple ascending dose levels of GT-02287 in healthy volunteers to assess safety and pharmacokinetics.
In September 2023, we initiated the first-in-human Phase 1 clinical trial to assess the safety, tolerability, pharmacokinetics, and food effect of GT-02287 in healthy participants.
The increase in research and development expenses for the year ended December 31, 2022 was primarily attributable to increases in external collaborations and external expenses, such as pre-IND clinical studies, quality and clinical manufacturing due to advancement of our GBA1 PD research programs into a development stage.
The increase in research and development expenses for the year ended December 31, 2023 was primarily attributable to increases in external R&D services and external expenses related to the commencement and conduct of our Phase 1 clinical trial with our lead drug candidate GT-02287 for the treatment of GBA1 Parkinson’s disease.
We continue to monitor the impacts on our operations and access to financing of global and worsening macroeconomic conditions, such as the war in Ukraine, global geopolitical tension, the COVID-19 pandemic, heightened inflation and rising interest rates, exchange rate fluctuations, supply chain disruptions, recent and potential future bank failures and increases in commodity, energy and fuel prices. 71 Table of Contents Financial Condition ​ Since our inception in 2017, we have devoted substantially all of our resources to identify and develop next-generation brain-penetrant allosteric small molecules for the treatment of devastating diseases with high-unmet medical needs using our in-licensed SEE-Tx® platform.
Gain Therapeutics Australia is our wholly owned subsidiary with the business purpose to conduct and supervise the Phase 1 clinical trial of our lead product candidate GT-02287. ​ ​ 75 Table of Contents Financial Condition ​ Since our inception in 2017, we have devoted substantially all of our resources to identify and develop next-generation brain-penetrant allosteric small molecules for the treatment of devastating diseases with high-unmet medical needs using our Magellan™ platform.
The variance is also due to higher personnel-related costs resulting from an increase in employee headcount and stock-based compensation expenses. Interest income, net Interest income net increased by $362,862 to $375,357 for the year ended December 31, 2022 from $12,495 for the year ended December 31, 2021.
The increase in general and administrative expenses for the year ended December 31, 2023 was primarily attributable to increases in professional fees for corporate compliance consulting and non cash costs related to share based compensation. 80 Table of Contents Interest income, net Interest income net increased by $0.12 million to $0.49 million for the year ended December 31, 2023 from $0.37 million for the year ended December 31, 2022.
Removed
We use our exclusively in-licensed computational target and drug discovery platform, Site-Directed Enzyme Enhancement Therapy (“SEE-Tx®”), to discover novel allosteric binding sites on proteins implicated in a disease and to identify proprietary small molecules that bind these sites to modulate protein function and treat the underlying cause of the disease.
Added
In preclinical models of GBA1 Parkinson’s disease, GT-02287 has been shown to restore glucocerebrosidase, or GCase, function in the lysosome, reduce toxic lipid substrates and toxic forms of alpha-synuclein, improve survival of dopaminergic neurons, increase dopamine levels, completely restore locomotor function, and reduce plasma-based neurodegeneration maker, neurofilament light chain, or NfL, back to the level of healthy animals.
Removed
We believe that SEE-Tx® is uniquely suited to identify allosteric binding sites on the protein surface, which are different from the protein’s active (or orthosteric) binding site where the natural ligand of the protein binds.
Added
The study design includes a single ascending dose part during which the study participants receive one dose of GT-02287 at different dose levels, and a multiple ascending dose part during which the study participants receive one daily dose of GT-02287 for 14 days at different dose levels.
Removed
Targeting an allosteric binding site instead of the active binding site of a protein provides numerous advantages, including: the ability to regulate proteins implicated in disease through several different mechanisms of action covering both functional and conformational effects, including stabilization, destabilization, targeted degradation, allosteric inhibition, and allosteric activation of the targeted protein; improved specificity of small molecules because binding to an allosteric binding site is non-competitive with the natural substrate that binds to the active binding site; and the ability to identify small molecules with more favorable drug-like properties.
Added
In February 2024, we initiated the multiple ascending dose part of this Phase 1 clinical trial, which we anticipate completing in the second quarter of 2024, with the availability of the quality assurance audited interim report in the third quarter of 2024.
Removed
The SEE-Tx® platform has been used to identify novel allosteric sites and small molecules for all of our internal programs and partnered programs.
Added
We are planning to expand the scope of this Phase 1 clinical trial by amending the study protocol to include a cohort of 12-15 patients with Parkinson’s disease.
Removed
Discovering and targeting novel allosteric sites with our platform not only reduces traditional drug discovery timelines but enables rational drug design and offers the potential for superior small molecule drugs that are highly specific and that can penetrate hard to reach tissues and cross the blood-brain barrier.
Added
These patients will be treated for a period of three months to evaluate safety, tolerability, and pharmacokinetics in patients, as well as to assess the effect of GT-02287 on certain biomarkers of the GCase disease cascade. In preparation for the treatment of Parkinson’s disease patients, in September 2023, we initiated the sub chronic (13 weeks treatment) preclinical toxicity study.
Removed
We anticipate completing IND-enabling toxicology studies in the first half of 2023 with the goal of filing the dossier required to commence a first-time-in-human, Phase 1 clinical trial of GT-02287 in the second half of 2023.
Added
The in-vivo phase of the preclinical toxicity study was concluded in January 2024 with the final, quality assurance audited, report expected by the beginning of the second quarter of 2024.
Removed
In addition, we plan to continue to advance research programs and initiate additional programs targeting allosteric binding sites identified with the SEE-Tx® platform in various therapeutic areas, mainly oncology. Through academic partnerships, co-development and licensing arrangements, we intend to develop a broad pipeline of therapeutics, using our novel approach of identifying and targeting previously unknown allosteric sites.
Added
In addition, we are planning to initiate the chronic (6 months in rodents and 9 months in non-rodents) preclinical toxicity study in the second half of 2024, enabling the conduct of clinical studies in patients with a GT-02287 treatment duration beyond three months .
Removed
In response to the current financing environment, we continue to streamline our operational plans to become more capital efficient. We are focusing on progressing our Parkinson’s and Gaucher disease programs and remain opportunistic to partnering opportunities for these lead programs and for drug discovery collaborations with our exclusively in-licensed computational SEE-Tx® platform.
Added
On June 1, , 2023 our Australian subsidiary (Gain Therapeutics Australia PTY LTD or “Gain Therapeutics Australia” ) was established.
Removed
In addition, we expect to continue to develop our program for Krabbe disease and liver and lung disease program, and use our exclusively in-licensed computational SEE-Tx® platform to establish new programs in oncology while seeking non-dilutive funding in order to continue or progress our other research programs.
Added
During the year ended December 31, 2023, we sold an aggregate of 862,535 shares of common stock at an average price of $4.60 per share, raising gross proceeds of $3.9 million, which includes $0.4 million in sales and commissions and other offering expenses.
Removed
We have financed our operations through a combination of sales of convertible preferred stock, including Series A Preferred Stock and Series B Preferred Stock, and our initial public offering (“IPO”) of our common stock, as well as research grants. In 2019 and 2020, through our Series A and Series B financings, we raised $14 million in aggregate gross proceeds.
Added
The Sales Agreement and the ATM Program were terminated in conjunction with the public offering and concurrent private placement of shares of the Company’s common stock in November 2023, as described below. In November 2023, we completed the public offering of 2.5 million shares of our common stock and warrants to purchase 1.3 million shares of our common stock.
Removed
On March 17, 2021, we completed our IPO and issued and sold approximately 4.1 million shares of our common stock at a public offering price of $11.00 per share, including approximately 0.5 million shares in connection with the full exercise of the underwriters’ option to purchase additional shares, resulting in net proceeds of approximately $40.5 million, after deducting the underwriting discounts and commissions and offering expenses.
Added
The warrants have an exercise price of $2.75 per share and were sold at the rate of one warrant for every two shares of common stock purchased in the public offering.
Removed
We believe that our existing cash, cash equivalents and marketable securities will enable us to fund our operating expenses and capital expenditure requirements into the second quarter of 2024.
Added
The public offering price for each set of two shares of common stock and accompanying warrant to purchase one share of commons stock was $4.01 (with an effective price of $2.00 per share and $0.01 per warrant).
Removed
Recently worsening global macroeconomic conditions, including actions taken by central banks to counter inflation, recent and potential future bank failures, volatility in the capital markets and related market uncertainty, may impact our ability to obtain additional financing when needed on favorable terms or at all. 72 Table of Contents In May 2022, we filed a shelf registration statement on Form S-3, which covers the offering, issuance and sale of up to a maximum aggregate offering price of $100.0 million of any combination of our common stock, preferred stock, debt securities and/or warrants from time to time in one or more offerings (the “Shelf Registration Statement”).
Added
In a private placement that was completed concurrently with the public offering we also issued to accredited investors 2.5 million of shares of our common stock (or pre-funded warrants in lieu thereof) and private warrants to purchase 2.5 million shares of our common stock with an exercise price of $2.75 per share.
Removed
We are currently subject to General Instruction I.B.6 to Form S-3 (the “Baby Shelf Rule”), and the amount of funds we can raise through primary public offerings of securities in any twelve-month period using our Shelf Registration Statement is limited to one-third of the aggregate market value of the voting and non-voting common equity held by non-affiliates.
Added
The private offering price per share and accompanying warrant in the private placement was $2.00 per set of securities sold privately. The public offering and the concurrent private placement resulted in combined gross proceeds of $10.1 million, which includes $1.2 million of underwriting commissions, placement agent’s fees and other expenses connected with the financing round.
Removed
We will be limited by the Baby Shelf Rule until such time as our public float exceeds $75.0 million. As of December 31, 2022, the Company has not sold any securities pursuant to the Shelf Registration Statement. ​ In May 2022, we entered into a Controlled Equity Offering SM Sales Agreement, or Sales Agreement with Cantor Fitzgerald & Co.
Added
As of December 31, 2023 $0.9 million of the costs associated with the financing round had already been paid or deducted from the gross proceeds, while the reminder of the amount has been paid in the first quarter of 2024.
Removed
(“Cantor”), pursuant to which we may offer and sell shares of our common stock having an aggregate offering price of up to $16.0 million from time to time through or to Cantor, acting as our agent or principal, in a series of one or more at-the-market equity offerings.
Added
In addition, we will need significant additional financing to fund our operations and to develop our product candidates. 76 Table of Contents Our ability to continue operations after our current cash resources are exhausted depends on our ability to obtain additional financing or to achieve profitable operations, as to which no assurances can be given.
Removed
Cantor is not required to sell any specific amount but acts as our sales agent using commercially reasonable efforts consistent with its normal trading and sales practices. Shares sold pursuant to the Sales Agreement will be sold pursuant to the Shelf Registration Statement and will count towards the limit of the Baby Shelf Rule.
Added
Cash requirements may vary materially from those now planned because of changes in direction of our research and development programs, competitive and technical advances, patent developments, regulatory changes or other developments.
Removed
Our common stock will be sold at prevailing market prices at the time of the sale, and as a result, prices may vary.
Added
If adequate additional funds are not available when required, or if we are unsuccessful in entering into partnership agreements for further development of our pipeline, management may need to curtail our development efforts and planned operations to conserve cash.
Removed
(“Zentalis”) to discover new product candidates for the treatment of cancer. Under the terms of the Zentalis Agreement, we have agreed to use our licensed SEE-Tx® computational platform technology to identify binding site on target proteins and determine the potential suitability of these sites as drug targets, as well as their prospective therapeutic use in oncology.
Added
Going Concern ​ As of December 31, 2023 and December 31, 2022, we had an accumulated deficit of $60.8 million and $38.5 million, respectively, and as of December 31, 2023, we had cash, cash equivalents and marketable securities of $16.8 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS Under SEC rules and regulations, because we are considered to be a “smaller reporting company”, we are not required to provide the information required by this item in this Annual Report ​ 81 Table of Contents
Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS Under SEC rules and regulations, because we are considered to be a “smaller reporting company”, we are not required to provide the information required by this item in this Annual Report ​ 85 Table of Contents