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What changed in MeiraGTx Holdings plc's 10-K — 2023 vs 2024

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

+612 added−549 removedSource: 10-K (2025-03-13) vs 10-K (2024-03-15)

Top changes in MeiraGTx Holdings plc's 2024 10-K

612 paragraphs added · 549 removed · 441 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

178 edited+85 added−32 removed379 unchanged
Biggest changeA summary of our product candidates and the status of such product candidates as of March 1, 2024 is described below. 6 Table of Contents In addition to these clinical and preclinical programs, we have preclinical and research programs in other indications and novel molecular technologies that we aim to advance into clinical development, including: ● riboswitch gene regulation—use of our proprietary RNA shape regulation cassette to precisely control gene expression with novel small molecules, potentially transforming gene therapy technology into a delivery mechanism for a broad array of biologic drugs; ● geographic atrophy age related macular degeneration, or dry AMD—use of gene therapy technology to introduce light sensitive molecules into rod photoreceptors in order to restore some aspects of vision lost in this disease; ● other ocular conditions—glaucoma and uveitis; ● central nervous systems/peripheral nervous system diseases—brain-derived neurotrophic factor gene therapy for treatment of genetic obesity disorders, as well as the development of gene therapy product candidates for other central nervous system diseases; and ● inflammatory/autoimmune diseases—use of gene therapy technology for the local delivery of immunomodulatory therapeutics, including osteoarthritis, gout and certain rare inflammatory disorders.
Biggest changeIn addition to these clinical and preclinical programs, we have preclinical and research programs in other indications and novel molecular technologies that we aim to advance into clinical development, including: ● riboswitch gene regulation—use of our proprietary RNA shape regulation cassette to precisely control gene expression with novel small molecules, potentially transforming gene therapy technology into a delivery mechanism for a broad array of biologic drugs; ● central nervous systems/peripheral nervous system diseases—brain-derived neurotrophic factor gene therapy for treatment of genetic obesity disorders, as well as the development of gene therapy product candidates for other central nervous system diseases; and ● inflammatory/autoimmune diseases—use of gene therapy technology for the local delivery of immunomodulatory therapeutics, including osteoarthritis, gout and certain rare inflammatory disorders.
The process required by the FDA before a biologic may be marketed in the United States generally involves the following: ● completion of extensive nonclinical studies, sometimes referred to as preclinical laboratory tests, and preclinical studies and applicable requirements for the humane use of laboratory animals and formulation studies in accordance with applicable regulations, including good laboratory practices, or GLPs; ● submission to the FDA of an IND which must become effective before clinical trials may begin; ● approval by an independent Institutional Review Board, or IRB, or ethics committee at each clinical site before the trial is commenced; 29 Table of Contents ● performance of adequate and well controlled human clinical trials according to the FDA’s regulations commonly referred to as good clinical practices, or GCPs, and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed biological product for its intended use; ● preparation and submission to the FDA of a BLA for marketing approval that includes substantive evidence of safety, purity, potency and efficacy from results of nonclinical testing and clinical trials; ● a determination by the FDA within 60 days of its receipt of a BLA to file the application for review; ● satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the biological product is produced to assess compliance with current GMP, or cGMP, to assure that the facilities, methods and controls are adequate to preserve the biological product’s identity, strength, quality and purity; ● potential FDA audit of the nonclinical and clinical study sites that generated the data in support of the BLA; ● FDA review and approval, or licensure, of the BLA prior to any commercial marketing or sale of the product in the United States; and ● compliance with any post-approval requirements, including the potential requirement to conduct post-approval studies.
The process required by the FDA before a biologic may be marketed in the United States generally involves the following: ● completion of extensive nonclinical studies, sometimes referred to as preclinical laboratory tests, and preclinical studies and applicable requirements for the humane use of laboratory animals and formulation studies in accordance with applicable regulations, including good laboratory practices, or GLPs; ● submission to the FDA of an IND which must become effective before clinical trials may begin; ● approval by an independent Institutional Review Board, or IRB, or ethics committee at each clinical site before the trial is commenced; ● performance of adequate and well controlled human clinical trials according to the FDA’s regulations commonly referred to as good clinical practices, or GCPs, and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed biological product for its intended use; ● preparation and submission to the FDA of a BLA for marketing approval that includes substantive evidence of safety, purity, potency and efficacy from results of nonclinical testing and clinical trials; ● a determination by the FDA within 60 days of its receipt of a BLA to file the application for review; ● satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the biological product is produced to assess compliance with current GMP, or cGMP, to assure that the facilities, methods and controls are adequate to preserve the biological product’s identity, strength, quality and purity; ● potential FDA audit of the nonclinical and clinical study sites that generated the data in support of the BLA; ● FDA review and approval, or licensure, of the BLA prior to any commercial marketing or sale of the product in the United States; and ● compliance with any post-approval requirements, including the potential requirement to conduct post-approval studies.
The second patent family includes 46 issued patents in the United States, Albania, Australia, Austria, Belgium, Bulgaria, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Latvia, Lithuania, Luxembourg, Malaysia, Malta, Mexico, Monaco, Netherlands, North Macedonia, Norway, Poland, Portugal, Romania, San Marino, Serbia, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 15 pending patent applications with claims directed to compositions of matter and methods of use in the United States, African Regional Intellectual Property Organization, Brazil, Canada, Egypt, Eurasian Patent Organization, India, Indonesia (two applications), Republic of Korea, New Zealand, Philippines (two applications), South Africa and Vietnam.
The second patent family includes 48 issued patents in the United States, Albania, Australia, Austria, Belgium, Bulgaria, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Latvia, Lithuania, Luxembourg, Malaysia, Malta, Mexico, Monaco, Netherlands, North Macedonia, Norway, Poland, Portugal, Romania, San Marino, Serbia, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 15 pending patent applications with claims directed to compositions of matter and methods of use in the United States, African Regional Intellectual Property Organization, Brazil, Canada, Egypt, Eurasian Patent Organization, India, Indonesia, Republic of Korea, New Zealand, Philippines (two applications), South Africa and Vietnam (two applications).
Government Regulation Outside of the United States In addition to regulations in the United States, we may be subject to a variety of regulations in other jurisdictions, for instance in the UK or EU, governing, among other things, clinical trials, marketing authorizations, or MA, post-MA requirements and any commercial sales and distribution of our products.
Government Regulation Outside of the United States In addition to regulations in the United States, we may be subject to a variety of regulations in other jurisdictions, for instance in the UK or EU, governing, among other things, clinical trials, marketing authorizations, or MAs, post-MA requirements and any commercial sales and distribution of our products.
The UK regulatory framework in relation to clinical trials is derived from existing EU legislation (as implemented into UK law, through secondary legislation), and after Brexit, EU laws on clinical trials (including the CTR) are not directly applicable in Great Britain (i.e., the UK excluding Northern Ireland).
The UK regulatory framework in relation to clinical trials is derived from pre-existing EU legislation (as implemented into UK law, through secondary legislation), and after Brexit, EU laws on clinical trials (including the CTR) are not directly applicable in Great Britain (i.e., the UK excluding Northern Ireland).
UK Specials Regulation The UK’s Human Medicines Regulations 2012 allow for the manufacture and supply of medicinal products not authorized for marketing to patients with special needs at the request of the healthcare professional responsible for the patient’s care (these products are referred to as “specials”).
UK Specials Regulation The UK’s Human Medicines Regulations 2012 (as amended) allow for the manufacture and supply of medicinal products not authorized for marketing to patients with special needs at the request of the healthcare professional responsible for the patient’s care (these products are referred to as “specials”).
National governments and health service providers have different priorities and approaches to the delivery of health care and the pricing and reimbursement of products in that context. In general, however, the healthcare budgetary constraints in most EU member states have resulted in restrictions on the pricing and reimbursement of medicines by relevant health service providers.
National governments and health service providers have different priorities and approaches to the delivery of healthcare and the pricing and reimbursement of products in that context. In general, however, the healthcare budgetary constraints in most EU member states have resulted in restrictions on the pricing and reimbursement of medicines by relevant health service providers.
To address LCA4, we developed a viral vector to replace the AIPL1 gene in all photoreceptors by using the AIPL1 cDNA driven by the rhodopsin kinase promoter, which is active in both rods and cones. We have manufactured and released AAV-AIPL1 for compassionate use under an MHRA specials license in the UK to treat eight children with LCA4.
To address LCA4, we developed a viral vector to replace the AIPL1 gene in all photoreceptors by using the AIPL1 cDNA driven by the rhodopsin kinase promoter, which is active in both rods and cones. We have manufactured and released AAV-AIPL1 for compassionate use under an MHRA specials license in the UK to treat 11 children with LCA4.
The fourth patent family includes 45 issued patents in the United States, Albania, Australia, Austria, Belgium, Bulgaria, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Latvia, Lithuania, Luxembourg, Malta, Malaysia, Monaco, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Republic of Korea, Romania, San Marino, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 16 pending patent applications with claims directed to compositions of matter and methods of use in the United States, African Regional Industrial Property Organization, Australia, Brazil, Egypt, Eurasian Patent Organization, Hong Kong, India, Indonesia, Israel, Mexico, New Zealand, Philippines, Singapore, South Africa and Vietnam.
The fourth patent family includes 51 issued patents in the United States, Albania, Australia, Austria, Belgium, Bulgaria, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Eurasian Patent Organization, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Republic of Korea, Latvia, Lithuania, Luxembourg, Malta, Malaysia, Mexico, Monaco, Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Romania, San Marino, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 10 pending patent applications with claims directed to compositions of matter and methods of use in the United States, African Regional Industrial Property Organization, Australia, Brazil, Egypt, New Zealand, Philippines, Singapore, South Africa and Vietnam.
The first patent family, with claims directed to compositions of matter and methods of use relating to our RPE65 program, and the AAV-RPE65 product candidate includes 49 issued patents in the United States, Albania, Australia, Austria, Belgium, Bulgaria, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, India, Ireland, Israel (two patents), Italy, Japan, Latvia, Lithuania, Luxembourg, Malta, Malaysia, Mexico, Monaco, Netherlands, North Macedonia, Norway, Philippines, Poland, Portugal, Romania, San Morino, Serbia, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 10 pending patent applications in the United States, Brazil, Canada, European Patent Organization, Hong Kong, Mexico, New Zealand (two applications), Nigeria and Thailand.
The first patent family, with claims directed to compositions of matter and methods of use relating to our RPE65 program, and the AAV-RPE65 product candidate includes 52 issued patents in the United States (two patents), Albania, Australia, Austria, Belgium, Bulgaria, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, India, Ireland, Israel (two patents), Italy, Japan, Latvia, Lithuania, Luxembourg, Malta, Malaysia, Mexico, Monaco, Netherlands, New Zealand, North Macedonia, Norway, Philippines, Poland, Portugal, Romania, San Morino, Serbia, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 7 pending patent applications in the United States, Brazil, European Patent Organization, Hong Kong, Mexico, Nigeria and Thailand.
At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical 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.
At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure, drug price reporting and other transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
The first patent family includes 54 issued patents in the United States (two patents), African Regional Intellectual Property Organization, Albania, Australia, Austria, Belgium, Bulgaria, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Eurasian Patent Organization, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, India, Ireland, Israel (two patents), Italy, Japan (two patents), Latvia, Lithuania, Luxembourg, Malaysia, Malta, Mexico, Monaco, Netherlands, New Zealand, North Macedonia, Norway, Philippines, Poland, Portugal, Romania, San Marino, Serbia, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 22 pending patent applications with claims directed to compositions of matter and methods of use in the United States, African Regional Intellectual Property Organization, Australia, Brazil, Canada, China, Egypt, Eurasian Patent Organization, European Patent Organization, Hong Kong (two applications), Indonesia, Japan, Republic of Korea, Mexico, New Zealand, Philippines, Singapore, South Africa (three applications) and Vietnam.
The first patent family includes 58 issued patents in the United States (two patents), African Regional Intellectual Property Organization, Albania, Australia (two patents), Austria, Belgium, Bulgaria, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Eurasian Patent Organization, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, India, Ireland, Israel (two patents), Italy, Japan (two patents), Republic of Korea, Latvia, Lithuania, Luxembourg, Malaysia, Malta, Mexico, Monaco, Netherlands, New Zealand, North Macedonia, Norway, Philippines, Poland, Portugal, Romania, San Marino, Serbia, Singapore, Slovakia, Slovenia, South Africa (two patents) Spain, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 20 pending patent applications with claims directed to compositions of matter and methods of use in the United States, African Regional Intellectual Property Organization, Australia, Brazil, Canada, China, Egypt, Eurasian Patent Organization, European Patent Organization, Hong Kong (two applications), Indonesia, Japan, Republic of Korea, Mexico, New Zealand, Philippines, Singapore, South Africa and Vietnam.
In May 2018, we were granted a license to manufacture gene therapy product candidates in our GMP compliant manufacturing facility by the United Kingdom’s Medicines and Healthcare products Regulatory Agency, or MHRA. The MHRA re-certified the facility in the second quarter of 2020 .
In May 2018, we were granted a license to manufacture gene therapy product candidates in our GMP compliant manufacturing facility by the United Kingdom’s Medicines and Healthcare products Regulatory Agency, or MHRA. The MHRA re-certified the facility in the second quarter of 2024 .
In addition to giving us access to patients and potentially accelerated enrollment in our treatment studies, we believe the prospective natural history data on each treated patient allow us to gather robust data from our Phase 1/2 clinical trials in a condensed timeframe.
In addition to giving us access to patients and potentially accelerated enrollment in our treatment studies, we believe the prospective natural history data on each treated patient allowed us to gather robust data from our Phase 1/2 clinical trials in a condensed timeframe.
It will permit EU member states to use common HTA tools, methodologies, and procedures across the EU, working together in four main areas, including joint clinical assessment of the innovative health technologies with the highest potential impact for patients, joint scientific consultations whereby developers can seek advice from HTA authorities, identification of emerging health technologies to identify promising technologies early, and continuing voluntary cooperation in other areas.
It will permit EU member states to use common HTA tools, methodologies, and procedures across the EU, working together in four main areas, including joint clinical assessment of the innovative health technologies with the highest potential impact for patients, joint scientific consultations whereby developers can seek advice from HTA authorities, identification of emerging health technologies to identify promising technologies early, 48 Table of Contents and continuing voluntary cooperation in other areas.
Neurodegenerative Disease Preclinical Development Pipeline In addition to our clinical stage Parkinson’s disease program, we continue to conduct research to develop our preclinical pipeline of gene therapy product candidates for the treatment of other serious diseases of the central nervous system, including AAV-UPF1 to address motor neuron death in amyotrophic lateral sclerosis (ALS), and an Alzheimer’s 10 Table of Contents disease program focused on endosomal trafficking dysfunction.
Neurodegenerative Disease Preclinical Development Pipeline In addition to our clinical stage Parkinson’s disease program, we continue to conduct research to develop our preclinical pipeline of gene therapy product candidates for the treatment of other serious diseases of the central nervous system, including AAV-UPF1 to address motor neuron death in amyotrophic lateral sclerosis (ALS), and an Alzheimer’s disease program focused on endosomal trafficking dysfunction.
A special may only be supplied: (i) in response to an unsolicited order from a healthcare professional responsible for the care of the patient, (ii) if the product is manufactured and assembled in accordance with the specifications of that healthcare professional to fulfil the special needs of the individual patient which cannot be met by products already authorized for marketing, and (iii) if the product is manufactured under a specials license granted by the UK’s MHRA.
A special may only be 50 Table of Contents supplied: (i) in response to an unsolicited order from a healthcare professional responsible for the care of the patient, (ii) if the product is manufactured and assembled in accordance with the specifications of that healthcare professional to fulfil the special needs of the individual patient which cannot be met by products already authorized for marketing, and (iii) if the product is manufactured under a specials license granted by the UK’s MHRA.
A sponsor who is planning to submit a marketing application for a drug or biological product that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration must submit an initial Pediatric Study Plan, or PSP, within sixty days after an end-of-Phase 2 meeting or as may be agreed between the sponsor and FDA.
A sponsor who is planning to submit a marketing application for a drug or biological product that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration must 33 Table of Contents submit an initial Pediatric Study Plan, or PSP, within sixty days after an end-of-Phase 2 meeting or as may be agreed between the sponsor and FDA.
On December 20, 2023 (the “Closing Date”), we and MeiraGTx UK II Limited entered into and consummated an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Janssen pursuant to which we sold and assigned to Janssen, and Janssen purchased and assumed, that certain License Agreement, dated February 5, 2019, by and between UCL Business Plc (now UCL Business Ltd.) (“UCLB”), on the one hand, and MeiraGTx UK II Limited and our wholly-owned subsidiary MeiraGTx Limited, on the other hand (the “UCLB RPGR License Agreement”), relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
On December 20, 2023 (the “Closing Date”), we and MeiraGTx UK II Limited entered into and consummated an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Johnson & Johnson Innovative Medicine pursuant to which we sold and assigned to Johnson & Johnson Innovative Medicine, and Johnson & Johnson Innovative Medicine purchased and assumed, that certain License Agreement, dated February 5, 2019, by and between UCL Business Plc (now UCL Business Ltd.) (“UCLB”), on the one hand, and MeiraGTx UK II Limited and our wholly-owned subsidiary MeiraGTx Limited, on the other hand (the “UCLB RPGR License Agreement”), relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount program with a new manufacturer discounting program (which began in 2025).
While the products we have in development do not make use of embryonic stem cells, it is possible that the national laws in certain EU member states may prohibit or restrict us from commercializing our products, even if they have been granted an MA. 43 Table of Contents Data and Marketing Exclusivity The EU also provides opportunities for market exclusivity.
While the products we have in development do not make use of embryonic stem cells, it is possible that the national laws in certain EU member states may prohibit or restrict us from commercializing our products, even if they have been granted an MA. Data and Marketing Exclusivity The EU also provides opportunities for market exclusivity.
Failure to comply with the requirements of GDPR and the applicable national data protection laws of the EU member states may result in fines of up to €20 million or up to 4% of the total worldwide 48 Table of Contents annual turnover of a noncompliant undertaking in the preceding financial year, whichever is higher, and other administrative penalties and may expose us to compensation claims from affected individuals.
Failure to comply with the requirements of GDPR and the applicable national data protection laws of the EU member states may result in fines of up to €20 million or up to 4% of the total worldwide annual turnover of a noncompliant undertaking in the preceding financial year, whichever is higher, and other administrative penalties and may expose us to compensation claims from affected individuals.
We chose diseases of the eye as our first area of clinical focus because we believe the eye is ideally suited for gene therapy for the following reasons. ● The eye is easily accessible and has highly compartmentalized anatomy, which allows for accurate delivery of vectors to specific tissues using direct visualization and microsurgical techniques. ● The structure of the eye allows for efficient delivery to specific cell subtypes with small volumes of vector, making the dose per patient much lower than is needed for systemic treatment. ● Anatomical barriers and unique structure of the eye make the immune response to the intraocular administration of vectors more attenuated than systemic administration. ● Largely non-dividing cell populations in the eye make good targets for potentially stable, long-term gene delivery and expression. ● The retina, a structure in the back of the eye, is visible and there are many well validated structural and functional readouts allowing the detailed assessment of the therapeutic impact of the gene therapy treatment.
We chose diseases of the eye as an area of clinical focus because we believe the eye is ideally suited for gene therapy for the following reasons. ● The eye is easily accessible and has highly compartmentalized anatomy, which allows for accurate delivery of vectors to specific tissues using direct visualization and microsurgical techniques. ● The structure of the eye allows for efficient delivery to specific cell subtypes with small volumes of vector, making the dose per patient much lower than is needed for systemic treatment. 12 Table of Contents ● Anatomical barriers and unique structure of the eye make the immune response to the intraocular administration of vectors more attenuated than systemic administration. ● Largely non-dividing cell populations in the eye make good targets for potentially stable, long-term gene delivery and expression. ● The retina, a structure in the back of the eye, is visible and there are many well validated structural and functional readouts allowing the detailed assessment of the therapeutic impact of the gene therapy treatment.
Strategically, we believe our facilities will minimize our dependence on third-party contract manufacturers, which we believe provides a significant strategic, clinical and commercial advantage, as well as significantly reduce the cost of goods sold for our programs. We have identified and licensed a proprietary HEK-293 cell line that is well characterized and that we have banked in hundreds of vials.
Strategically, we believe our facilities will minimize our dependence on third-party contract manufacturers, which we believe provides a significant strategic, clinical and commercial advantage, as well as significantly reduce the cost of goods sold for our programs. 23 Table of Contents We have identified and licensed a proprietary HEK-293 cell line that is well characterized and that we have banked in hundreds of vials.
Companies established in the UK can no longer use the centralized procedure and instead must follow one of the UK national authorization procedures or one of the remaining post-Brexit international cooperation procedures to obtain an MA to market products in the UK.
Therefore, since Brexit, companies established in the UK can no longer use the centralized procedure and instead must follow one of the UK national authorization procedures or one of the remaining post-Brexit international cooperation procedures to obtain an MA to market products in the UK.
The overall ten-year market exclusivity period may be extended to a maximum of eleven years if during the first eight years of those ten years, the MA holder obtains an authorization for one or more new therapeutic indications, which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit over existing therapies.
The overall ten-year market exclusivity period may be extended to a maximum of eleven years if during the first eight years of those ten years, the MA holder obtains an authorization for one or more 45 Table of Contents new therapeutic indications, which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit over existing therapies.
Additionally, pursuant to the Stand-Alone UCLB Agreement related to CNGB3, we paid UCLB an upfront payment of £1.5 million and issued £1.5 million of the Company’s ordinary shares. 27 Table of Contents Commencing on the first commercial sale of licensed products under each Stand-Alone UCLB Agreement, we must make low single-digit percentage royalty payments to UCLB on net sales of such products.
Additionally, pursuant to the Stand-Alone UCLB Agreement related to CNGB3, we paid UCLB an upfront payment of £1.5 million and issued £1.5 million of the Company’s ordinary shares. Commencing on the first commercial sale of licensed products under each Stand-Alone UCLB Agreement, we must make low single-digit percentage royalty payments to UCLB on net sales of such products.
Pursuant to the Brandeis Agreement, Brandeis granted us an exclusive, worldwide license under certain patent rights with claims directed to compositions of matter and methods of use relating to our ALS gene therapy program and the AAV-UPF1 product candidate to develop and commercialize licensed products. We must use commercially reasonable efforts to develop and commercialize licensed products.
Pursuant to the Brandeis Agreement, Brandeis granted us an exclusive, worldwide license under certain patent rights with claims directed to compositions of matter and methods of use relating to our ALS gene therapy program and the AAV-UPF1 product candidate to develop and commercialize licensed products. 29 Table of Contents We must use commercially reasonable efforts to develop and commercialize licensed products.
We believe that our deep understanding of disease models informs our development of potency assays for the GMP production of our product candidates, and our experienced teams in viral vector design and optimization work closely with our process development team to design viral vectors and develop proprietary production cell lines for efficient scaling of manufacturing processes.
We believe that our deep understanding of disease models informs our development of potency assays for the GMP production of our product 4 Table of Contents candidates, and our experienced teams in viral vector design and optimization work closely with our process development team to design viral vectors and develop proprietary production cell lines for efficient scaling of manufacturing processes.
Additional data from this study were presented at the Retina Subspecialty Day of the American Academy of Ophthalmology Annual Meeting in October 2019. 13 Table of Contents AAV-RPE65 met the study’s primary endpoint of safety and tolerability. Additionally, AAV-RPE65 demonstrated statistically significant improvement across several secondary endpoints assessing clinical activity.
Additional data from this study were presented at the Retina Subspecialty Day of the American Academy of Ophthalmology Annual Meeting in October 2019. AAV-RPE65 met the study’s primary endpoint of safety and tolerability. Additionally, AAV-RPE65 demonstrated statistically significant improvement across several secondary endpoints assessing clinical activity.
Biologics may be marketed only for the approved indications and in accordance with the provisions of the approved labeling. 36 Table of Contents Discovery of previously unknown problems or the failure to comply with the applicable regulatory requirements may result in restrictions on the marketing of a product or withdrawal of the product from the market as well as possible civil or criminal sanctions.
Biologics may be marketed only for the approved indications and in accordance with the provisions of the approved labeling. Discovery of previously unknown problems or the failure to comply with the applicable regulatory requirements may result in restrictions on the marketing of a product or withdrawal of the product from the market as well as possible civil or criminal sanctions.
Manufacturing a special also imposes a five year record retention requirement subject to review by the MHRA, including details of any suspected adverse reaction to the product so sold or supplied of which the person is aware or 16 Table of Contents subsequently becomes aware, as well as a continuing obligation to notify the MHRA of any suspected adverse reaction to the medicinal product which is a serious adverse reaction.
Manufacturing a special also imposes a five year record retention requirement subject to review by the MHRA, including details of any suspected adverse reaction to the product so sold or supplied of which the person is aware or subsequently becomes aware, as well as a continuing obligation to notify the MHRA of any suspected adverse reaction to the medicinal product which is a serious adverse reaction.
In the United States, the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by federal and state legislative initiatives, including those designed to limit the pricing, coverage, and reimbursement of pharmaceutical and biopharmaceutical products, especially under government-funded health care programs, and increased governmental control of drug pricing.
In the United States, the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by federal and state legislative initiatives, including those designed to limit the pricing, coverage, and reimbursement of pharmaceutical and biopharmaceutical products, especially under government-funded healthcare programs, and increased governmental control of drug pricing.
Marketing Authorizations In the EU, medicinal products can only be placed on the market after obtaining an MA. To obtain regulatory approval of an investigational chemical or biological product in the EU, we must submit a marketing authorization application, or MAA. The process for doing this depends, among other things, on the nature of the medicinal product.
Marketing Authorizations In the EU, medicinal products can only be placed on the market after obtaining an MA. To obtain regulatory approval of an investigational chemical or biological product in the EU, we must submit an MAA. The process for doing this depends, among other things, on the nature of the medicinal product.
Additional aspects of the transgene sequence may be engineered for optimal gene expression, such as codon usage and synthetic introns, which may enhance levels of therapeutic protein expression. 19 Table of Contents Gene therapy can be used to address monogenic diseases, which result in mutations in a single gene in a patient’s genome.
Additional aspects of the transgene sequence may be engineered for optimal gene expression, such as codon usage and synthetic introns, which may enhance levels of therapeutic protein expression. Gene therapy can be used to address monogenic diseases, which result in mutations in a single gene in a patient’s genome.
The fifth patent family includes three issued patents in the United States, Australia and Japan and 22 pending patent applications with claims directed to compositions of matter and methods of use in the United States, African Regional Industrial Property Organization, Australia, Brazil, Canada, China, Egypt, Eurasian Patent Organization, European Patent Organization, Hong Kong, India, Indonesia, Israel, Republic of Korea, Malaysia, Mexico, New Zealand (two applications), Philippines, Singapore, South Africa and Vietnam.
The fifth patent family includes nine issued patents in the United States, African Regional Industrial Property Organization, Australia, China, Indonesia, Japan, Republic of Korea, Mexico and Philippines, and 16 pending patent applications with claims directed to compositions of matter and methods of use in the United States, Australia, Brazil, Canada, Egypt, Eurasian Patent Organization, European Patent Organization, Hong Kong, India, Israel, Malaysia, New Zealand (two applications), Singapore, South Africa and Vietnam.
The third patent family includes nine issued patents in the United States, African Regional Intellectual Property Organization, China, India, Indonesia, Japan, Malaysia, Mexico and Singapore and 14 pending patent applications with claims directed to compositions of matter and methods of use in the United States, Australia, Brazil, Canada, Egypt, Eurasian Patent Organization, European Patent Organization, Hong Kong, Israel, Republic of Korea, New Zealand, Philippines, South Africa and Vietnam.
The third patent family includes 11 issued patents in the United States, African Regional Intellectual Property Organization, Australia, China, Eurasian Patent Organization, India, Indonesia, Japan, Malaysia, Mexico and Singapore and 12 pending patent applications with claims directed to compositions of matter and methods of use in the United States, Brazil, Canada, Egypt, European Patent Organization, Hong Kong, Israel, Republic of Korea, New Zealand, Philippines, South Africa and Vietnam.
We have developed a gene therapy candidate optimized for safety and potency for the treatment of RPE65 -associated retinal dystrophy, AAV-RPE65. AAV-RPE65 is an AAV2/5 viral vector, in which a codon optimized RPE65 gene is driven by a novel synthetic retinal pigment epithelium cell specific promoter.
We have developed a gene therapy candidate optimized for safety and potency for the treatment of RPE65 -associated retinal 13 Table of Contents dystrophy, AAV-RPE65. AAV-RPE65 is an AAV2/5 viral vector, in which a codon optimized RPE65 gene is driven by a novel synthetic retinal pigment epithelium cell specific promoter.
Post-approval clinical trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These clinical trials are used to gain additional experience from the treatment of patients in the intended therapeutic indication, particularly for long-term safety follow-up.
Post-approval clinical trials, sometimes referred to as Phase 4 clinical trials, may be conducted after initial marketing approval. These clinical trials are used to gain additional experience from the treatment of patients in the intended therapeutic indication, particularly for long-term safety follow- 32 Table of Contents up.
For example, the EU General Data Protection Regulation, or GDPR, imposes strict requirements for processing the personal data of individuals within the European Economic Area, or EEA, or in the context of our activities in the EEA. The GDPR allows EU member states to make additional laws and regulations further regulating the processing of genetic, biometric or health data.
For example, the EU General Data Protection Regulation, or GDPR, imposes strict requirements for processing the personal data of individuals within the EEA or in the context of our activities in the EEA. The GDPR allows EU member states to make additional laws and regulations further regulating the processing of genetic, biometric or health data.
We believe that gene therapy using AAV-UPF1 may increase UPF1 levels in cells affected by ALS, and we intend to deliver our viral vector product candidate to the central nervous system via intrathecal injection, or injection into the spinal canal. Alzheimer’s Disease With the world population aging, Alzheimer’s disease has emerged as an extremely common and costly disease.
We believe that gene therapy using AAV-UPF1 may increase UPF1 levels in cells affected by ALS, and we intend to deliver our viral vector product candidate to the central nervous system via intrathecal injection, or injection into the spinal canal. 11 Table of Contents Alzheimer’s Disease With the world population aging, Alzheimer’s disease has emerged as an extremely common and costly disease.
In recent years, the first gene therapies have received regulatory approval, including approval by the FDA of Luxturna, marketed by Spark Therapeutics, Inc. which was purchased by Roche, for treatment of RPE65 -associated retinal dystrophy, and Zolgensma, marketed by AveXis, Inc., a Novartis company, for the treatment of spinal muscular atrophy, resulting in a growing acceptance of gene therapy technology as a potentially safe and effective therapeutic approach.
In recent years, more than 40 gene therapies have received regulatory approval, including approval by the FDA of Luxturna, marketed by Spark Therapeutics, Inc. which was purchased by Roche, for treatment of RPE65 -associated retinal dystrophy, and Zolgensma, marketed by AveXis, Inc., a Novartis company, for the treatment of spinal muscular atrophy, resulting in a growing acceptance of gene therapy technology as a potentially safe and effective therapeutic approach.
Patents issued from this family are expected to expire February 2, 2037, not including any patent term adjustments that may extend the patent term in certain jurisdictions.
Patents issued from this family are expected to expire February 2, 2036, not including any patent term adjustments that may extend the patent term in certain jurisdictions.
Both the FDCA and the PHSA and their corresponding regulations govern, among other things, the research, development, safety, testing, packaging, manufacture, storage, recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling, and import and export of biological products. U.S.
Both the FDCA and the PHSA and their corresponding regulations govern, among other things, the research, development, safety, testing, packaging, manufacture, storage, recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling, and import and export of biological products. 30 Table of Contents U.S.
It is illegal to pay, offer to pay or authorize the payment of anything of value to any employee or official of a foreign government or public international organization, or political party, political party official, or political candidate in an attempt to obtain or retain business or to otherwise influence a person working in an official capacity.
It is illegal to pay, offer to pay or authorize the payment of anything of value to any 41 Table of Contents employee or official of a foreign government or public international organization, or political party, political party official, or political candidate in an attempt to obtain or retain business or to otherwise influence a person working in an official capacity.
Further, the obligation to provide pediatric clinical trial data can be waived by the PDCO when these data are not needed or appropriate because the product is likely to be ineffective or unsafe in children, the disease or condition for which the product is intended occurs only in adult populations, or when the product does not represent a significant therapeutic benefit over existing treatments for pediatric patients.
Further, the obligation 46 Table of Contents to provide pediatric clinical trial data can be waived by the PDCO when these data are not needed or appropriate because the product is likely to be ineffective or unsafe in children, the disease or condition for which the product is intended occurs only in adult populations, or when the product does not represent a significant therapeutic benefit over existing treatments for pediatric patients.
Our policy is to protect our proprietary position by, among other methods, filing or collaborating with our licensors to file U.S. and foreign patent applications related to our proprietary technology, inventions and improvements that are important to the development and implementation of our business.
Our policy is to protect our proprietary position by, among other methods, filing or collaborating with our licensors to file U.S. and foreign patent applications related to our proprietary technology, inventions and improvements that are important to the development 24 Table of Contents and implementation of our business.
The Brandeis Agreement may be terminated by Brandeis 28 Table of Contents for our insolvency or for our material breach that remains uncured for 60 days (or for 30 days in the case of breaches related to payment obligations). Such material breach may be cured only once in any 12-month period.
The Brandeis Agreement may be terminated by Brandeis for our insolvency or for our material breach that remains uncured for 60 days (or for 30 days in the case of breaches related to payment obligations). Such material breach may be cured only once in any 12-month period.
Biological product manufacturers and other entities involved in the manufacture and distribution of approved biological products are required to register their establishments with the FDA and certain state agencies, and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP requirements and other laws.
Biological product manufacturers and other entities involved in the manufacture and distribution of approved biological products are required to register their establishments with the FDA and certain state agencies, and are subject 38 Table of Contents to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP requirements and other laws.
A REMS is a safety strategy to 33 Table of Contents manage a known or potential serious risk associated with a medicine and to enable patients to have continued access to such medicines by managing their safe use, and could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
A REMS is a safety strategy to manage a known or potential serious risk associated with a medicine and to enable patients to have continued access to such medicines by managing their safe use, and could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools.
Unless otherwise required by regulation, PREA does not apply to any biological product for an indication for which orphan drug designation has been granted. 32 Table of Contents Under the Prescription Drug User Fee Act, or PDUFA, as amended, each BLA must be accompanied by a user fee. The FDA adjusts the PDUFA user fees on an annual basis.
Unless otherwise required by regulation, PREA does not apply to any biological product for an indication for which orphan drug designation has been granted. Under the Prescription Drug User Fee Act, or PDUFA, as amended, each BLA must be accompanied by a user fee. The FDA adjusts the PDUFA user fees on an annual basis.
The idea is that the gene encoding a particular biologic drug or a therapeutic antibody or peptide would be delivered to target cells in the body, but these transgenes would only be activated in the presence of a specific, proprietary small molecule.
The idea is that 21 Table of Contents the gene encoding a particular biologic drug or a therapeutic antibody or peptide would be delivered to target cells in the body, but these transgenes would only be activated in the presence of a specific, proprietary small molecule.
In addition, we have now delivered combinations of gut peptides such as GLP-1, GIP and PYY, and we have shown that the efficacy with respect to glucose control is better than constitutively active expression of those peptides.
In addition, we have now delivered combinations of gut peptides such as GLP-1, GIP glucagon, amylin, PYY and leptin, and we have shown that the efficacy with respect to glucose control is better than constitutively active expression of those peptides.
As noted above, on December 20, 2023, we and MeiraGTx UK II Limited entered into and consummated an Asset Purchase Agreement with Janssen pursuant to which we sold and assigned to Janssen, and Janssen purchased and assumed, the UCLB RPGR License Agreement relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
As noted above, on December 20, 2023, we and MeiraGTx UK II Limited entered into and consummated an Asset Purchase Agreement with Johnson & Johnson Innovative Medicine pursuant to which we sold and assigned to Johnson & Johnson Innovative Medicine, and Johnson & Johnson Innovative Medicine purchased and assumed, the UCLB RPGR License Agreement relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
The FDA or the sponsor or its data safety monitoring board may suspend or permanently discontinue a clinical trial at any time on various grounds, including a 31 Table of Contents finding that the research subjects or patients are being exposed to an unacceptable health risk or the clinical trial is not being conducted in accordance with FDA regulations.
The FDA or the sponsor or its data safety monitoring board may suspend or permanently discontinue a clinical trial at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk or the clinical trial is not being conducted in accordance with FDA regulations.
Additionally, an MA may be granted to a similar product for the same indication at any time if (1) the second applicant can establish that its product, although similar, is 44 Table of Contents safer, more effective or otherwise clinically superior, (2) the applicant consents to a second orphan medicinal product application; or (3) the applicant cannot supply enough orphan medicinal product.
Additionally, an MA may be granted to a similar product for the same indication at any time if (1) the second applicant can establish that its product, although similar, is safer, more effective or otherwise clinically superior, (2) the applicant consents to a second orphan medicinal product application; or (3) the applicant cannot supply enough orphan medicinal product.
The centralized procedure is optional for product candidates 41 Table of Contents containing a new active substance not yet authorized in the EU, or for product candidates that constitute a significant therapeutic, scientific or technical innovation or which are in the interest of public health in the EU.
The centralized procedure is optional for product candidates containing a new active substance not yet authorized in the EU, or for product candidates that constitute a significant therapeutic, scientific or technical innovation or which are in the interest of public health in the EU.
Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to make compliance efforts more challenging, and can result in investigations, proceedings, or actions that lead to significant penalties and restrictions on data processing. 39 Table of Contents U.S. Foreign Corrupt Practices Act The U.S.
Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to make compliance efforts more challenging, and can result in investigations, proceedings, or actions that lead to significant penalties and restrictions on data processing. U.S. Foreign Corrupt Practices Act The U.S.
The sixth patent family includes three issued patents in African Regional Industrial Property Organization, Japan and Mexico and 20 pending patent applications with claims directed to compositions of matter and methods of use in the United States, Australia, Brazil, Canada, China, Egypt, Eurasian Patent Organization, European Patent Organization, Hong Kong, India, Indonesia, Israel, Republic of Korea, Malaysia, New Zealand (two applications), Philippines, Singapore, South Africa and Vietnam.
The sixth patent family includes nine issued patents in African Regional Industrial Property Organization, China, Indonesia, Israel, Japan, Republic of Korea, Malaysia, Mexico and New Zealand and 14 pending patent applications with claims directed to compositions of matter and methods of use in the United States, Australia, Brazil, Canada, Egypt, Eurasian Patent Organization, European Patent Organization, Hong Kong, India, New Zealand, Philippines, Singapore, South Africa and Vietnam.
On January 30, 2019, we and our wholly-owned subsidiary MeiraGTx UK II Limited entered into a Collaboration, Option and License Agreement with Janssen Pharmaceuticals, Inc., one of the Janssen Pharmaceutical Companies of Johnson & Johnson (“Janssen”), as further amended by that certain First Amendment to Collaboration, Option and License Agreement, dated as of December 16, 2021 (the “Collaboration Agreement”), for, among other things, the research, development and commercialization of gene therapies for the treatment of IRDs, including botaretigene sparoparvovec, or bota-vec (formerly referred to as AAV-RPGR), for the treatment of X-linked retinitis pigmentosa related to mutations in the retinitis pigmentosa GTPase regulator gene , or XLRP-RPGR (the “RPGR Product”), and two genetic forms of achromatopsia.
Relationship with Johnson & Johnson Innovative Medicine On January 30, 2019, we and our wholly-owned subsidiary MeiraGTx UK II Limited entered into a Collaboration, Option and License Agreement with Johnson & Johnson Innovative Medicine (formerly known as Janssen Pharmaceuticals, Inc.), as further amended by that certain First Amendment to Collaboration, Option and License Agreement, dated as of December 16, 2021 (the “Collaboration Agreement”), for, among other things, the research, development and commercialization of gene therapies for the treatment of IRDs, including botaretigene sparoparvovec, or bota-vec (formerly referred to as AAV-RPGR), for the treatment of X-linked retinitis pigmentosa related to mutations in the retinitis pigmentosa GTPase regulator gene , or XLRP-RPGR (the “RPGR Product”), and two genetic forms of achromatopsia.
A negative HTA by a leading and recognized HTA body concerning a medicinal product could undermine the prospects to obtain reimbursement for such product not only in the EU member state in which the negative assessment was issued, but also in other EU member states. 46 Table of Contents In 2011, Directive 2011/24/EU was adopted at the EU level.
A negative HTA by a leading and recognized HTA body concerning a medicinal product could undermine the prospects to obtain reimbursement for such product not only in the EU member state in which the negative assessment was issued, but also in other EU member states. In 2011, Directive 2011/24/EU was adopted at the EU level.
The third patent family, which we have exclusively optioned, with claims directed to compositions of matter and methods of use relating to our dry AMD gene therapy program, includes 52 issued patents in African Regional Intellectual Property Organization, Albania, Austria, Australia, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Eurasian Patent Organization, Finland, France, Germany, Greece, Hong, Kong, Hungary, Iceland, Indonesia, Ireland, Israel, Italy, Japan, Republic of Korea, Latvia, Lithuania, Luxembourg, Malta, Malaysia, Mexico, Monaco, Netherlands, New Zealand, Nigeria, North Macedonia, Norway, Poland, Portugal, Romania, San Marino, Serbia, Singapore, Slovakia, Slovenia, Spain, South Africa, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and 9 pending applications in the United States, Australia, Brazil, China, Hong Kong, Philippines, Singapore, Thailand and Vietnam.
The third patent family, with claims directed to compositions of matter and methods of use relating to our dry AMD gene therapy program, includes 54 issued patents in African Regional Intellectual Property Organization, Albania, Austria, Australia (two patents), Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Eurasian Patent Organization, Finland, France, Germany, Greece, Hong, Kong, Hungary, Iceland, Indonesia, Ireland, Israel, Italy, Japan, Republic of Korea, Latvia, Lithuania, Luxembourg, Malta, Malaysia, Mexico, Monaco, Netherlands, New Zealand, Nigeria, North Macedonia, Norway, Poland, Portugal, Romania, San Marino, Serbia, Singapore (two patents), Slovakia, Slovenia, Spain, South Africa, Sweden, Switzerland/Liechtenstein, Turkey and the United Kingdom and seven pending applications in the United States, Brazil, China, Hong Kong, Philippines, Thailand and Vietnam.
Our gene therapy product candidate AAV-CNGA3 was granted orphan drug designation by the FDA and orphan designation by the European Commission, rare pediatric disease designation by the FDA, and in January 2021, was granted Fast Track designation by the FDA for the treatment of ACHM caused by CNGA3 mutations.
Our gene therapy product candidate AAV-CNGA3 was granted orphan drug designation by the FDA and orphan designation by the European Commission, rare pediatric disease designation by the FDA, and was granted Fast Track designation by the FDA for the treatment of ACHM caused by CNGA3 mutations.
The sponsor of a Fast Track product 34 Table of Contents candidate has opportunities for more frequent interactions with the review team during product development and, once a BLA is submitted, the application may be eligible for priority review.
The sponsor of a Fast Track product candidate has opportunities for more frequent interactions with the review team during product development and, once a BLA is submitted, the application may be eligible for priority review.
Janssen is also responsible for any royalty or milestone amounts that become payable on the RPGR Product under the UCLB RPGR License Agreement. ​ Strategic Investment from Sanofi On October 30, 2023, we entered into an Investment Agreement (the “Investment Agreement”) with Sanofi Foreign Participations B.V.
Johnson & Johnson Innovative Medicine is also responsible for any royalty or milestone amounts that become payable on the RPGR Product under the UCLB RPGR License Agreement. ​ Strategic Investment from Sanofi On October 30, 2023, we entered into an Investment Agreement (the “Investment Agreement”) with Sanofi Foreign Participations B.V.
In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. The FDA may also impose clinical holds on a biological product candidate at any time before or during clinical trials due to safety concerns or non-compliance.
In such a case, the IND sponsor and the FDA must resolve any outstanding concerns before the clinical trial can begin. The FDA may also impose clinical holds on a 31 Table of Contents biological product candidate at any time before or during clinical trials due to safety concerns or non-compliance.
A specials license allows physicians to prescribe a treatment of AAV-AIPL1 for patients with LCA4 that they deem appropriate. We play no role in the physician’s treatment decision.
A specials license allows physicians to prescribe a treatment of AAV-AIPL1 for patients with LCA4 that they deem appropriate with local ethics approval. We play no role in the physician’s treatment decision.
Based on the safety and efficacy data observed for AAV-hAQP1 in the Phase 1 clinical trial, we initiated in June 2023 a randomized, double-blind, placebo-controlled Phase 2 study evaluating two active doses of AAV-hAQP1 for the treatment of grade 2 or 3 RIX with participants currently being enrolled and dosed.
Based on the safety and efficacy data observed for AAV-hAQP1 in the Phase 1 clinical trial, we initiated in June 2023 a randomized, double-blind, placebo-controlled Phase 2 AQUAx2 study evaluating two active doses of AAV-hAQP1 for the treatment of grade 2 or 3 RIX with participants currently being enrolled and dosed in the U.S., Canada and UK.
In connection with entering into the Asset Purchase Agreement, we and MeiraGTx UK II Limited entered into a Termination Agreement with Janssen on the Closing Date terminating the Collaboration Agreement. ​ MeiraGTx UK II Limited and Janssen also entered into a Supply Agreement on the Closing Date pursuant to which MeiraGTx UK II Limited agreed to manufacture and supply the RPGR Product for Janssen (the “Supply Agreement”).
In connection with entering into the Asset Purchase Agreement, we and MeiraGTx UK II Limited entered into a Termination Agreement with Johnson & Johnson Innovative Medicine on the Closing Date terminating the Collaboration Agreement. ​ MeiraGTx UK II Limited and Johnson & Johnson Innovative Medicine also entered into a Supply Agreement on the Closing Date pursuant to which MeiraGTx UK II Limited agreed to manufacture and supply the RPGR Product for Johnson & Johnson Innovative Medicine (the “Supply Agreement”).
The sponsor must take out a clinical trial insurance policy, and in most EU member states, the sponsor is liable to provide ‘no fault’ compensation to any study subject injured in the clinical trial. 40 Table of Contents The regulatory landscape related to clinical trials in the EU has been subject to recent changes.
The sponsor must take out a clinical trial insurance policy, and in most EU member states, the sponsor is liable to provide ‘no fault’ compensation to any study subject injured in the clinical trial. The regulatory landscape related to clinical trials in the EU has been subject to recent changes.
A conditional MA may contain specific obligations to be fulfilled by the MA holder, including obligations with respect to the completion of ongoing or new studies, and with respect to the collection of pharmacovigilance data.
A conditional MA may contain specific obligations to be fulfilled by the MA holder, including obligations with respect 44 Table of Contents to the completion of ongoing or new studies, and with respect to the collection of pharmacovigilance data.
The sialogogues pilocarpine (approved for RIX) and cevimeline (used off-label) are minimally effective in patients with grade 2/3 RIX where the gland structure and function have been significantly impaired. No new medications for RIX have been approved in over 20 years.
The sialogogues pilocarpine (approved for RIX) and cevimeline (used off-label) are minimally effective in 7 Table of Contents patients with grade 2/3 RIX where the gland structure and function have been significantly impaired. No new medications for RIX have been approved in over 20 years.
Our wholly-owned facilities have now produced GMP clinical trial material for six different indications, using multiple AAV serotypes, including administration into the eye, salivary gland and central nervous system. 4 Table of Contents We have also developed a potentially transformative technology to precisely and specifically control gene expression levels via dose-response to orally delivered small molecules.
Our wholly-owned facilities have now produced GMP clinical trial material for eight different indications, using multiple AAV serotypes, including administration into the eye, salivary gland and central nervous system. We have also developed a potentially transformative technology to precisely and specifically control gene expression levels via dose-response to orally delivered small molecules.
We can 21 Table of Contents knock our regulation mechanism into T-cells to regulate CAR expression in CAR-T, and have demonstrated reduced exhaustion, improved T-cell profile, improved cytotoxicity, and 3-4x increased potency in tumor killing, in vivo , compared to existing CAR-T therapies.
We can knock our regulation mechanism into T-cells to regulate CAR expression in CAR-T, and have demonstrated reduced exhaustion, improved T-cell profile, improved cytotoxicity, and 3-4x increased potency in tumor killing, in vivo , compared to existing CAR-T therapies.
Janssen is responsible for any royalty or milestone amounts that become payable on the RPGR Product under the UCLB RPGR License Agreement. License Agreement between BRI-Alzan Inc. and Brandeis In May 2013, BRI-Alzan Inc., or BRI-Alzan, entered into a license agreement with Brandeis, or the Brandeis Agreement.
Johnson & Johnson Innovative Medicine is responsible for any royalty or milestone amounts that become payable on the RPGR Product under the UCLB RPGR License Agreement. License Agreement between BRI-Alzan Inc. and Brandeis In May 2013, BRI-Alzan Inc., or BRI-Alzan, entered into a license agreement with Brandeis, or the Brandeis Agreement.
Post Brexit, the MHRA has updated various aspects of the regulatory regime for medicines in the UK, including: introducing the Innovative Licensing and Access Procedure to accelerate the time to market and facilitate patient access for innovative medicines; updates to the UK national approval procedure, introducing a 150-day objective for assessing applications for MAs in the UK, Great Britain and Northern Ireland and a rolling review process for MA applications (rather than a consolidated full dossier submission).
Post Brexit, the MHRA has updated various aspects of the regulatory regime for medicines in the UK, including: introducing the Innovative Licensing and Access Procedure to accelerate the time to market and facilitate patient access for innovative medicines; updates to the UK national approval procedure, introducing a 150-day objective for assessing applications for MAs in the UK and a rolling review process for MAAs (rather than a consolidated full dossier submission).
Failure to conduct required confirmatory trials in a timely manner, or to confirm a clinical benefit during post-marketing trials, will allow the FDA to withdraw the approved biologic product from the market on an expedited basis.
Failure to conduct required confirmatory trials in a timely manner, or to confirm a clinical benefit 36 Table of Contents during post-marketing trials, will allow the FDA to withdraw the approved biologic product from the market on an expedited basis.
Additionally, pursuant to and subject to the terms and conditions set forth in the Asset Purchase Agreement, Janssen agreed to pay us future contingent consideration of up to an aggregate of $350.0 million, as follows: (i) a milestone payment of $50.0 million in connection with the achievement of the initiation of the extension study for the Phase 3 LUMEOS clinical trial for the RPGR Product, which milestone was achieved during the first quarter of 2024; (ii) $10.0 million upon completion of certain specified development services for the drug substance for the RPGR Product; (iii) $5.0 million upon completion of certain specified development services for the drug product for the RPGR Product; (iv) $175.0 million upon the first commercial sale of an RPGR Product in the United States; (v) 5 Table of Contents $75.0 million upon the first commercial sale of an RPGR Product in at least one of the United Kingdom, France, Germany, Spain and Italy; (vi) $25.0 million upon completion of the transfer of certain manufacturing technology for drug substance and drug product from us to Janssen; and (vii) $10.0 million upon regulatory approval of a Janssen-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
Additionally, pursuant to and subject to the terms and conditions set forth in the Asset Purchase Agreement, Johnson & Johnson Innovative Medicine agreed to pay us future contingent consideration of up to an aggregate of $350.0 million, as follows: (i) a milestone payment of $50.0 million in connection with the achievement of the initiation of the extension study for the Phase 3 LUMEOS clinical trial for the RPGR Product; (ii) $10.0 million upon completion of certain specified development services for the drug substance for the RPGR Product; (iii) $5.0 million upon completion of certain specified development services for the drug product for the RPGR Product; (iv) $175.0 million upon the first commercial sale of an RPGR Product in the United States; (v) $75.0 million upon the first commercial sale of an RPGR Product in at least one of the United Kingdom, France, Germany, Spain and Italy; (vi) $25.0 million upon completion of the transfer of certain manufacturing technology for drug substance and drug product from us to Johnson & Johnson Innovative Medicine; and (vii) $10.0 million upon regulatory approval of a Johnson & Johnson Innovative Medicine-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
ACHM patients suffer significant vision loss due to the complete lack of cone function. ACHM occurs in approximately one in 30,000 people in the United States.
ACHM patients suffer significant vision loss due to the complete lack of cone function. ACHM occurs in 14 Table of Contents approximately one in 30,000 people in the United States.
Competitors, however, may receive approval of different products for the indication for which the orphan product has exclusivity or obtain approval for the same product but for a different disease or condition for which the orphan product has exclusivity.
Competitors, however, may receive approval of different products for the indication for which the orphan product has exclusivity or obtain approval for the same product but for a different disease or condition for which the orphan product has 35 Table of Contents exclusivity.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

176 edited+40 added−34 removed474 unchanged
Biggest changeOur future funding requirements, both near and long-term, will depend on many factors, including, but not limited to: ● the progress, timing, costs and results of our clinical development for our radiation-induced xerostomia product candidate, AAV-hAQP1, and for our product candidate for the treatment of Parkinson’s disease, AAV-GAD; ● the progress, timing, costs and results of our ongoing clinical development for our CNGB3 achromatopsia gene therapy product candidate, AAV-CNGB3, for our CNGA3 achromatopsia gene therapy product candidate, AAV-CNGA3, for our RPE65-associated retinal dystrophy product candidate, AAV-RPE65, and to continue to conduct our ongoing natural history studies for IRDs; 52 Table of Contents ● the development of our product candidate for the treatment of ALS, AAV-UPF1, for our product candidate for the treatment of xerostomia associated with Sjogren’s syndrome, AAV-hAQP1, and our product candidate for the treatment of neovascular age related macular degeneration, or wet AMD; ● the development of our potentially transformative gene regulation technology designed to precisely and specifically control gene therapy expression levels via dose-response to orally delivered small molecules; ● the extent to which we receive the milestone payments under the Asset Purchase Agreement with Janssen; ● continuing our current research programs and our preclinical development of product candidates from our current research programs; ● seeking to identify, assess, acquire and/or develop additional research programs and additional product candidates; ● the preclinical testing and clinical trials for any product candidates we identify and develop; ● the outcome, timing and cost of meeting regulatory requirements established by the FDA, MHRA, EMA and other regulatory authorities; ● the cost of expanding and protecting our intellectual property portfolio, including filing, prosecuting, defending and enforcing our patent claims and other intellectual property rights; ● the cost of defending potential intellectual property disputes, including patent infringement actions brought by third parties against us or any of our product candidates; ● the effect of competing technological and market developments; ● the cost of further developing and scaling our manufacturing facilities and processes; ● the cost and timing of completion of commercial-scale manufacturing facilities and activities; ● the cost of making royalty, milestone or other payments under current and any future in-license agreements; ● our ability to establish and maintain strategic collaborations, licensing or other agreements and the financial terms of such agreements; ● the extent to which we in-license or acquire rights to other products, product candidates and technologies; ● the cost of establishing sales, marketing and distribution capabilities for our product candidates in regions where we choose to commercialize our products; and ● the initiation, progress, timing and results of our commercialization of our product candidates, if approved for commercial sale. 53 Table of Contents Raising additional capital through the sale of equity or convertible debt securities will dilute your ownership interest, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a shareholder.
Biggest changeOur future funding requirements, both near and long-term, will depend on many factors, including, but not limited to: ● the progress, timing, costs and results of our clinical development for our radiation-induced xerostomia product candidate, AAV-hAQP1, and for our product candidate for the treatment of Parkinson’s disease, AAV-GAD; ● the progress, timing, costs and results of our ongoing clinical development for our AAV-AIPL1 gene therapy product candidate, our CNGB3 achromatopsia gene therapy product candidate, AAV-CNGB3, for our CNGA3 achromatopsia gene therapy product candidate, AAV-CNGA3, and for our RPE65-associated retinal dystrophy product candidate, AAV-RPE65; ● the development of our product candidate for the treatment of ALS, AAV-UPF1, for our product candidate for the treatment of xerostomia associated with Sjogren’s syndrome, AAV-hAQP1, and our product candidate for the treatment of neovascular age related macular degeneration, or wet AMD; ● the development of our potentially transformative riboswitch gene regulation platform technology designed to precisely and specifically control gene therapy expression levels via dose-response to orally delivered small molecules; ● the extent to which we receive the milestone payments under the Asset Purchase Agreement with Johnson & Johnson Innovative Medicine; ● continuing our current research programs and our preclinical development of product candidates from our current research programs; ● seeking to identify, assess, acquire and/or develop additional research programs and additional product candidates; ● the preclinical testing and clinical trials for any product candidates we identify and develop; ● the outcome, timing and cost of meeting regulatory requirements established by the FDA, MHRA, EMA and other regulatory authorities; ● the cost of expanding and protecting our intellectual property portfolio, including filing, prosecuting, defending and enforcing our patent claims and other intellectual property rights; 55 Table of Contents ● the cost of defending potential intellectual property disputes, including patent infringement actions brought by third parties against us or any of our product candidates; ● the effect of competing technological and market developments; ● the cost of further developing and scaling our manufacturing facilities and processes; ● the cost and timing of completion of commercial-scale manufacturing facilities and activities; ● the cost of making royalty, milestone or other payments under current and any future in-license agreements; ● our ability to establish and maintain strategic collaborations, licensing or other agreements and the financial terms of such agreements; ● the extent to which we in-license or acquire rights to other products, product candidates and technologies; ● the cost of establishing sales, marketing and distribution capabilities for our product candidates in regions where we choose to commercialize our products; and ● the initiation, progress, timing and results of our commercialization of our product candidates, if approved for commercial sale.
A risk in any gene therapy product based on viral vectors is the risk of insertional mutagenesis. ​ If unacceptable side effects or deaths arise in the development of our product candidates, we, the FDA, the IRBs at the institutions in which our studies are conducted, DSMB, or other regulatory bodies could suspend or terminate our clinical trials or the FDA, MHRA or other regulatory authorities could order us to cease clinical trials or deny approval of our product candidates for any or all targeted indications.
A risk in any gene therapy product based on viral vectors is the risk of insertional mutagenesis. ​ If unacceptable side effects or deaths arise in the development of our product candidates, we, the FDA, the IRBs at the institutions in which our studies are conducted, the DSMB, or other regulatory bodies could suspend or terminate our clinical trials or the FDA, MHRA or other regulatory authorities could order us to cease clinical trials or deny approval of our product candidates for any or all targeted indications.
If our management is unable to effectively manage our expected growth, our expenses may increase more than expected, our potential ability to generate revenue could be reduced and we may not be able to implement our business strategy.
If our management is unable to effectively manage our growth, our expenses may increase more than expected, our potential ability to generate revenue could be reduced and we may not be able to implement our business strategy.
Events that may prevent successful or timely completion of clinical development include: ● inability to generate sufficient preclinical, toxicology, or other in vivo or in vitro data to support the initiation of clinical trials; ● delays in sufficiently developing, characterizing or controlling a manufacturing process suitable for advanced clinical trials; ● delays in developing suitable assays for screening patients for eligibility for trials with respect to certain product candidates; ● delays in reaching consensus with the FDA, MHRA or other regulatory authorities as to the design or implementation of our clinical trials and obtaining regulatory allowance or approval to commence a clinical trial; ● inability to reach an agreement on acceptable terms with clinical trial sites or prospective contract research organizations, or CROs, the terms of which can be subject to extensive negotiation and may vary significantly among different clinical trial sites; ● our inability to recruit and train clinical trial investigators with the appropriate competencies and experience to conduct the clinical trials, administer our product candidates and oversee clinical trial staff; ● delays in obtaining IRB or ethics committee approval or positive opinion at each site; ● inability to recruit suitable patients to participate in a clinical trial; ● inability to develop and validate any companion diagnostic we may decide to use in connection with a clinical trial, if applicable; ● delays in sufficiently developing, designing and manufacturing equipment or medical devices used to administer our product candidates in our clinical trials, if applicable; ● patients not completing a clinical trial or returning for post-treatment follow-up; ● clinical sites, CROs, or other third parties deviating from trial protocol or dropping out of a trial; ● failures to conduct clinical trials in accordance with good clinical practice, or GCP, requirements, or other applicable regulatory guidelines; 59 Table of Contents ● addressing patient safety concerns that arise during the course of a trial, including occurrence of adverse events associated with the product candidate; ● having an insufficient number of clinical trial sites; or ● inability to manufacture sufficient quantities of our product candidates for use in clinical trials, or to manufacture such product candidates to acceptable quality standards.
Events that may prevent successful or timely completion of clinical development include: ● inability to generate sufficient preclinical, toxicology, or other in vivo or in vitro data to support the initiation of clinical trials; ● delays in sufficiently developing, characterizing or controlling a manufacturing process suitable for advanced clinical trials; ● delays in developing suitable assays for screening patients for eligibility for trials with respect to certain product candidates; ● delays in reaching consensus with the FDA, MHRA or other regulatory authorities as to the design or implementation of our clinical trials and obtaining regulatory allowance or approval to commence a clinical trial; ● inability to reach an agreement on acceptable terms with clinical trial sites or prospective contract research organizations, or CROs, the terms of which can be subject to extensive negotiation and may vary significantly among different clinical trial sites; ● our inability to recruit and train clinical trial investigators with the appropriate competencies and experience to conduct the clinical trials, administer our product candidates and oversee clinical trial staff; ● delays in obtaining IRB or ethics committee approval or positive opinion at each site; ● inability to recruit suitable patients to participate in a clinical trial; ● inability to develop and validate any companion diagnostic we may decide to use in connection with a clinical trial, if applicable; ● delays in sufficiently developing, designing and manufacturing equipment or medical devices used to administer our product candidates in our clinical trials, if applicable; ● patients not completing a clinical trial or returning for post-treatment follow-up; ● clinical sites, CROs, or other third parties deviating from trial protocol or dropping out of a trial; 62 Table of Contents ● failures to conduct clinical trials in accordance with good clinical practice, or GCP, requirements, or other applicable regulatory guidelines; ● addressing patient safety concerns that arise during the course of a trial, including occurrence of adverse events associated with the product candidate; ● having an insufficient number of clinical trial sites; or ● inability to manufacture sufficient quantities of our product candidates for use in clinical trials, or to manufacture such product candidates to acceptable quality standards.
The degree of market acceptance of our product candidates, if approved for commercial sale, will depend on a number of factors, including but not limited to: ​ ● the efficacy and potential advantages compared to alternative treatments; ​ ● effectiveness of sales and marketing efforts; ​ ● the cost of treatment in relation to alternative treatments, including any similar generic treatments; ​ ● our ability to offer our product candidates for sale at competitive prices; 83 Table of Contents ​ ● the convenience and ease of administration; ​ ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ​ ● the strength of marketing and distribution support, and publicity concerning our products or competing products and treatments; ​ ● the timing of market introduction of competitive products; ​ ● the availability of third-party coverage and adequate reimbursement; ​ ● product labeling or product insert requirements of the FDA, MHRA, EMA or other regulatory authorities, including any limitations or warnings contained in a product’s approved labeling; ​ ● the prevalence and severity of any side effects; and ​ ● any restrictions on the use of our product together with other medications. ​ Because we expect sales of our product candidates, if approved, to generate substantially all of our product revenues for a substantial period, the failure of these product candidates to find market acceptance would harm our business and could require us to seek additional financing. ​ If we are unable to establish sales, marketing and distribution capabilities either on our own or in collaboration with third parties, we may not be successful in commercializing our product candidates or realizing the synergies in the target indications of our programs, even if they are approved. ​ We do not have any infrastructure for the sales, marketing or distribution of our products, and the cost of establishing and maintaining such an organization may exceed the cost-effectiveness of doing so or we may seek collaborative arrangements or external funding to commercialize our product candidates.
The degree of market acceptance of our product candidates, if approved for commercial sale, will depend on a number of factors, including but not limited to: ​ ● the efficacy and potential advantages compared to alternative treatments; ​ ● effectiveness of sales and marketing efforts; ​ ● the cost of treatment in relation to alternative treatments, including any similar generic treatments; ​ ● our ability to offer our product candidates for sale at competitive prices; ​ ● the convenience and ease of administration; ​ ● the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ​ ● the strength of marketing and distribution support, and publicity concerning our products or competing products and treatments; ​ ● the timing of market introduction of competitive products; ​ ● the availability of third-party coverage and adequate reimbursement; ​ ● product labeling or product insert requirements of the FDA, MHRA, EMA or other regulatory authorities, including any limitations or warnings contained in a product’s approved labeling; ​ ● the prevalence and severity of any side effects; and ​ ● any restrictions on the use of our product together with other medications. 88 Table of Contents ​ Because we expect sales of our product candidates, if approved, to generate substantially all of our product revenues for a substantial period, the failure of these product candidates to find market acceptance would harm our business and could require us to seek additional financing. ​ If we are unable to establish sales, marketing and distribution capabilities either on our own or in collaboration with third parties, we may not be successful in commercializing our product candidates or realizing the synergies in the target indications of our programs, even if they are approved. ​ We do not have any infrastructure for the sales, marketing or distribution of our products, and the cost of establishing and maintaining such an organization may exceed the cost-effectiveness of doing so or we may seek collaborative arrangements or external funding to commercialize our product candidates.
It is possible that the FDA may refuse to accept for substantive review any BLAs, or the MHRA or EMA any of our MAAs, that we submit for our product candidates or may conclude after review of our data that our application is insufficient to obtain marketing approval of our product candidates. ​ Prior to obtaining approval to commercialize a product candidate in the United States, the UK, the EU or elsewhere, we or our collaborators must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA, MHRA, EMA or foreign regulatory agencies, that such product candidates are safe and effective for their intended uses, or with respect to biologics in the United States, that such product candidates are safe, pure, and potent for their intended uses.
It is possible that the FDA may refuse to accept for substantive review any BLAs, or the MHRA or EMA any of our MAAs, that we submit for our product candidates or may conclude after review of our data that our application is insufficient to obtain marketing approval of our product candidates. ​ Prior to obtaining approval to commercialize a product candidate in the United States, the UK, the EU or elsewhere, we or our collaborators must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA, MHRA, EMA or other foreign regulatory agencies, that such product candidates are safe and effective for their intended uses, or with respect to biologics in the United States, that such product candidates are safe, pure, and potent for their intended uses.
The market price for our ordinary shares may be influenced by many factors, including: ​ ● the success of competitive products or technologies; ​ ● actual or expected changes in our growth rate relative to our competitors; ​ ● results of clinical trials of our product candidates or those of our competitors; ​ ● developments related to our existing or any future collaborations; ​ ● regulatory or legal developments in the United States and other countries; ​ 102 Table of Contents ● development of new product candidates that may address our markets and make our product candidates less attractive; ​ ● changes in physician, hospital or healthcare provider practices that may make our product candidates less useful; ​ ● announcements by us, our partners or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; ​ ● the impact of any potential strategic transactions related to our assets; ​ ● developments or disputes concerning patent applications, issued patents or other proprietary rights; ​ ● the recruitment or departure of key personnel; ​ ● the level of expenses related to any of our product candidates or clinical development programs; ​ ● failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public; ​ ● the results of our efforts to discover, develop, acquire or in-license additional product candidates or products; ​ ● actual or expected changes in estimates as to financial results, development timelines, recommendations by securities analysts or shifting investor perceptions; ​ ● variations in our financial results or those of companies that are perceived to be similar to us; ​ ● changes in the structure of healthcare payment systems; ​ ● market conditions in the pharmaceutical and biotechnology sectors; ​ ● general economic, industry and market conditions; ​ ● changes in accounting principles; and ​ ● the other factors described in this “Item 1A.
The market price for our ordinary shares may be influenced by many factors, including: ​ ● the success of competitive products or technologies; ​ ● actual or expected changes in our growth rate relative to our competitors; ​ ● results of clinical trials of our product candidates or those of our competitors; ​ ● developments related to our existing or any future collaborations; ​ ● regulatory or legal developments in the United States and other countries; ​ ● development of new product candidates that may address our markets and make our product candidates less attractive; ​ ● changes in physician, hospital or healthcare provider practices that may make our product candidates less useful; 106 Table of Contents ​ ● announcements by us, our partners or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; ​ ● the impact of any potential strategic transactions related to our assets; ​ ● developments or disputes concerning patent applications, issued patents or other proprietary rights; ​ ● the recruitment or departure of key personnel; ​ ● the level of expenses related to any of our product candidates or clinical development programs; ​ ● failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public; ​ ● the results of our efforts to discover, develop, acquire or in-license additional product candidates or products; ​ ● actual or expected changes in estimates as to financial results, development timelines, recommendations by securities analysts or shifting investor perceptions; ​ ● variations in our financial results or those of companies that are perceived to be similar to us; ​ ● changes in the structure of healthcare payment systems; ​ ● market conditions in the pharmaceutical and biotechnology sectors; ​ ● general economic, industry and market conditions; ​ ● changes in accounting principles; and ​ ● the other factors described in this “Item 1A.
Among the provisions of the ACA, those of greatest importance to the pharmaceutical and biotechnology industries include the following: ​ ● an annual, non-deductible fee payable by any entity that manufactures or imports certain branded prescription drugs and biologic agents (other than those designated as orphan drugs), which is apportioned among these entities according to their market share in certain government healthcare programs; ​ ● a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; ​ ● expansion of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to certain individuals with income at or below 133% of the federal poverty level, thereby potentially increasing a manufacturer’s Medicaid rebate liability; ​ ● a licensure framework for follow on biologic products; ​ ● a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research; and ​ ● establishment of a Center for Medicare & Medicaid Innovation at the Centers for Medicare & Medicaid Services, or CMS, to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending. ​ Since its enactment, there have been judicial, Congressional and executive branch challenges to certain aspects of the ACA.
Among the provisions of the ACA, those of greatest importance to the pharmaceutical and biotechnology industries include the following: ​ ● an annual, non-deductible fee payable by any entity that manufactures or imports certain branded prescription drugs and biologic agents (other than those designated as orphan drugs), which is apportioned among these entities according to their market share in certain government healthcare programs; ​ ● a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected; ​ ● expansion of eligibility criteria for Medicaid programs by, among other things, allowing states to offer Medicaid coverage to certain individuals with income at or below 133% of the federal poverty level, thereby potentially increasing a manufacturer’s Medicaid rebate liability; ​ ● a licensure framework for follow on biologic products; ​ ● a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research; and ​ ● establishment of a Center for Medicare & Medicaid Innovation at the CMS to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending. ​ Since its enactment, there have been judicial, Congressional and executive branch challenges to certain aspects of the ACA.
Any of these occurrences may harm our business, financial condition and prospects significantly. ​ 69 Table of Contents If any of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by any such product, including during any long-term follow-up observation period recommended or required for patients who receive treatment using our products, a number of potentially significant negative consequences could result, including: ​ ● regulatory authorities may withdraw approvals of such product; ​ ● we may be required to recall a product or change the way such product is administered to patients; ​ ● additional restrictions may be imposed on the marketing of the particular product or the manufacturing processes for the product; ​ ● regulatory authorities may require additional warnings on the label, such as a “black box” warning or contraindication; ​ ● we may be required to implement a Risk Evaluation and Mitigation Strategy, or REMS, or create a medication guide outlining the risks of such side effects for distribution to patients or similar risk management measures; ​ ● the product could become less competitive; ​ ● we could be sued and held liable for harm caused to patients; and ​ ● our reputation may suffer. ​ ​ ​ Any of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved, and could significantly harm our business, results of operations and prospects. ​ Success in preclinical studies or clinical trials may not be indicative of results in future clinical trials. ​ Results from previous preclinical studies or clinical trials are not necessarily predictive of future clinical trial results, and interim results of a clinical trial are not necessarily indicative of final results.
Any of these occurrences may harm our business, financial condition and prospects significantly. ​ 73 Table of Contents If any of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by any such product, including during any long-term follow-up observation period recommended or required for patients who receive treatment using our products, a number of potentially significant negative consequences could result, including: ​ ● regulatory authorities may withdraw approvals of such product; ​ ● we may be required to recall a product or change the way such product is administered to patients; ​ ● additional restrictions may be imposed on the marketing of the particular product or the manufacturing processes for the product; ​ ● regulatory authorities may require additional warnings on the label, such as a “black box” warning or contraindication; ​ ● we may be required to implement a Risk Evaluation and Mitigation Strategy, or REMS, or create a medication guide outlining the risks of such side effects for distribution to patients or similar risk management measures; ​ ● the product could become less competitive; ​ ● we could be sued and held liable for harm caused to patients; and ​ ● our reputation may suffer. ​ ​ ​ Any of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved, and could significantly harm our business, results of operations and prospects. ​ Success in preclinical studies or clinical trials may not be indicative of results in future clinical trials. ​ Results from previous preclinical studies or clinical trials are not necessarily predictive of future clinical trial results, and interim results of a clinical trial are not necessarily indicative of final results.
In addition, even if additional product candidates are granted such regulatory designations, the regulatory authority may later decide that such product candidates no longer meet the conditions for qualification or decide that the time period for review or approval will not be shortened, as applicable. ​ We have received orphan drug designation and orphan designation from the FDA and European Commission, respectively, for AAV-CNGB3, AAV-CNGA3, AAV-RPE65, AAV-AIPL1, AAV-RDH12 and orphan drug designation from the FDA for AAV-hAQP1, and we may seek orphan drug designation or orphan designation for additional product candidates in the future, but any orphan drug designations or orphan designations we have received or may receive in the future may not confer marketing exclusivity or other expected benefits.
In addition, even if additional product candidates are granted such regulatory designations, the regulatory authority may later decide that such product candidates no longer meet the conditions for qualification or decide that the time period for review or approval will not be shortened, as applicable. ​ We have received orphan drug designation and orphan designation from the FDA and European Commission, respectively, for AAV-CNGB3, AAV-CNGA3, AAV-RPE65, AAV-AIPL1, AAV-RDH12 and orphan drug designation from the FDA for AAV-hAQP1 and AAV-BBS10, and we may seek orphan drug designation or orphan designation for additional product candidates in the future, but any orphan drug designations or orphan designations we have received or may receive in the future may not confer marketing exclusivity or other expected benefits.
Any such changes in tax laws, regulations and treaties, or the interpretation thereof, tax policy initiatives and reforms under consideration and the practices of tax authorities in jurisdictions in which we operate could adversely affect our tax position, including our effective tax rate or tax payments. ​ We have significant U.S. federal and state net operating losses, or NOLs, and UK carryforward tax losses which we may not be able to realize or which may be restricted under applicable law.
Any such changes in tax laws, regulations and treaties, or the interpretation thereof, tax policy initiatives and reforms under consideration and the practices of tax authorities in jurisdictions in which we operate could adversely affect our tax position, including our effective tax rate or tax payments. ​ We have significant U.S. federal and state net operating losses, or NOLs, and UK and Ireland carryforward tax losses which we may not be able to realize or which may be restricted under applicable law.
The process of establishing and maintaining collaborative relationships is difficult, time-consuming and involves significant uncertainty, such as: ​ ● a collaboration partner may shift its priorities and resources away from our product candidates due to a change in business strategies, or a merger, acquisition, sale or downsizing; ​ ● a collaboration partner may seek to renegotiate or terminate their relationships with us due to unsatisfactory clinical results, manufacturing issues, a change in business strategy, a change of control or other reasons; ​ ● a collaboration partner may cease development in therapeutic areas which are the subject of our strategic collaboration; ​ ● a collaboration partner may not devote sufficient capital or resources towards our product candidates; ​ ● a collaboration partner may change the success criteria for a product candidate thereby delaying or ceasing development of such candidate; ​ ● a significant delay in initiation of certain development activities by a collaboration partner will also delay payment of milestones tied to such activities, thereby impacting our ability to fund our own activities; ​ ● a collaboration partner could develop a product that competes, either directly or indirectly, with our product candidate; ​ ● a collaboration partner with commercialization obligations may not commit sufficient financial or human resources to the marketing, distribution or sale of a product; ​ ● a collaboration partner with manufacturing responsibilities may encounter regulatory, resource or quality issues and be unable to meet demand requirements; ​ ● a collaboration partner may terminate a strategic alliance; ​ ● a dispute may arise between us and a partner concerning the research, development or commercialization of a product candidate resulting in a delay in milestones, royalty payments or termination of an alliance 88 Table of Contents and possibly resulting in costly litigation or arbitration which may divert management attention and resources; and ​ ● a partner may use our products or technology in such a way as to make us subject to litigation with a third party. ​ If any collaborator fails to fulfill its responsibilities in a timely manner, or at all, our research, clinical development, manufacturing or commercialization efforts related to that collaboration could be delayed or terminated, or it may be necessary for us to assume responsibility for expenses or activities that would otherwise have been the responsibility of our collaborator.
The process of establishing and maintaining collaborative relationships is difficult, time-consuming and involves significant uncertainty, such as: ​ ● a collaboration partner may shift its priorities and resources away from our product candidates due to a change in business strategies, or a merger, acquisition, sale or downsizing; ​ ● a collaboration partner may seek to renegotiate or terminate their relationships with us due to unsatisfactory clinical results, manufacturing issues, a change in business strategy, a change of control or other reasons; ​ ● a collaboration partner may cease development in therapeutic areas which are the subject of our strategic collaboration; ​ ● a collaboration partner may not devote sufficient capital or resources towards our product candidates; ​ ● a collaboration partner may change the success criteria for a product candidate thereby delaying or ceasing development of such candidate; ​ ● a significant delay in initiation of certain development activities by a collaboration partner will also delay payment of milestones tied to such activities, thereby impacting our ability to fund our own activities; ​ ● a collaboration partner could develop a product that competes, either directly or indirectly, with our product candidate; ​ ● a collaboration partner with commercialization obligations may not commit sufficient financial or human resources to the marketing, distribution or sale of a product; ​ ● a collaboration partner with manufacturing responsibilities may encounter regulatory, resource or quality issues and be unable to meet demand requirements; ​ ● a collaboration partner may terminate a strategic alliance; ​ ● a dispute may arise between us and a partner concerning the research, development or commercialization of a product candidate resulting in a delay in milestones, royalty payments or termination of an alliance and possibly resulting in costly litigation or arbitration which may divert management attention and resources; and ​ ● a partner may use our products or technology in such a way as to make us subject to litigation with a third party. ​ If any collaborator fails to fulfill its responsibilities in a timely manner, or at all, our research, clinical development, manufacturing or commercialization efforts related to that collaboration could be delayed or terminated, or it may be necessary for us to assume responsibility for expenses or activities that would otherwise have been the responsibility of our collaborator.
Physician Payments Sunshine Act and its implementing regulations, which requires certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid, or the Children’s Health Insurance Program, with specific exceptions, to report annually to the government information related to certain payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician practitioners (physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants and certified nurse midwives), and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members; ​ ● analogous U.S. state laws and regulations, including: state anti-kickback and false claims laws, which may apply to our business practices, including but not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed by any third-party payor, including private insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S. federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and other remuneration and items of value provided to healthcare professionals and entities; and state and local laws that require the registration of pharmaceutical sales representatives; and ​ ● similar healthcare laws and regulations in the UK, EU and other jurisdictions, including reporting requirements detailing interactions with and payments to healthcare providers. ​ Ensuring that our internal operations and future business arrangements with third parties comply with applicable healthcare laws and regulations will involve substantial costs.
Physician Payments Sunshine Act and its implementing regulations, which requires certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid, or the Children’s Health Insurance Program, with specific exceptions, to report annually to the government information related to certain payments and other transfers of value to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain non-physician practitioners (physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants and certified nurse midwives), and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members; ​ ● analogous U.S. state laws and regulations, including: state anti-kickback and false claims laws, which may apply to our business practices, including but not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed by any third-party payor, including private insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S. federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and other remuneration and items of value provided to healthcare professionals and entities; and state and local laws that require the registration of pharmaceutical sales representatives; and ​ 82 Table of Contents ● similar healthcare laws and regulations in the UK, EU and other jurisdictions, including reporting requirements detailing interactions with and payments to healthcare providers. ​ Ensuring that our internal operations and future business arrangements with third parties comply with applicable healthcare laws and regulations will involve substantial costs.
Similar risks apply in foreign jurisdictions. ​ 72 Table of Contents In addition, later discovery of previously unknown adverse events or other problems with our products, manufacturers or manufacturing processes, including adverse events of unanticipated severity or frequency, or with our manufacturing processes or third-party manufacturers, or failure to comply with regulatory requirements, may yield various results, including: ​ ● restrictions on manufacturing such products; ​ ● restrictions on the labeling or marketing of a product; ​ ● restrictions on product distribution or use; ​ ● requirements to conduct post-marketing studies or clinical trials; ​ ● warning letters or holds on clinical trials; ​ ● withdrawal of the products from the market; ​ ● refusal to approve pending applications or supplements to approved applications that we submit; ​ ● recall of products; ​ ● fines, restitution or disgorgement of profits or revenues; ​ ● suspension or withdrawal of marketing approvals; ​ ● refusal to permit the import or export of our products; ​ ● product seizure or detention; or ​ ● injunctions or the imposition of civil or criminal penalties. ​ The FDA’s and foreign regulatory authorities’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
Similar risks apply in foreign jurisdictions. ​ 76 Table of Contents In addition, later discovery of previously unknown adverse events or other problems with our products, manufacturers or manufacturing processes, including adverse events of unanticipated severity or frequency, or with our manufacturing processes or third-party manufacturers, or failure to comply with regulatory requirements, may yield various results, including: ​ ● restrictions on manufacturing such products; ​ ● restrictions on the labeling or marketing of a product; ​ ● restrictions on product distribution or use; ​ ● requirements to conduct post-marketing studies or clinical trials; ​ ● warning letters or holds on clinical trials; ​ ● withdrawal of the products from the market; ​ ● refusal to approve pending applications or supplements to approved applications that we submit; ​ ● recall of products; ​ ● fines, restitution or disgorgement of profits or revenues; ​ ● suspension or withdrawal of marketing approvals; ​ ● refusal to permit the import or export of our products; ​ ● product seizure or detention; or ​ ● injunctions or the imposition of civil or criminal penalties. ​ The FDA’s and foreign regulatory authorities’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates.
We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval or commercialize our product candidates or significantly increase the cost of such trials, including: ● we may experience changes in regulatory requirements or guidance, or receive feedback from regulatory authorities that requires us to modify the design of our clinical trials; ● clinical trials of our product candidates may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon development programs; ● the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate, or participants may drop out of these clinical trials at a higher rate than we anticipate; ● our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; ● we or our investigators might have to suspend or terminate clinical trials of our product candidates for various reasons, including non-compliance with regulatory requirements, a finding that our product candidates have undesirable side effects or other unexpected characteristics, or a finding that the participants are being exposed to unacceptable health risks; ● the cost of clinical trials of our product candidates may be greater than we anticipate, and we may not have funds to cover the costs; ● the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient or inadequate; ● business interruptions resulting from geopolitical actions, including war and terrorism, or a widespread health emergency, such as the COVID-19 pandemic, or natural disasters including earthquakes, typhoons, floods and fires, or from economic or political instability; and ● any future collaborators that conduct clinical trials may face any of the above issues, and they may conduct clinical trials in ways they view as advantageous to them but that are suboptimal for us.
We may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to receive marketing approval or commercialize our product candidates or significantly increase the cost of such trials, including: ● we may experience changes in regulatory requirements or guidance, or receive feedback from regulatory authorities that requires us to modify the design of our clinical trials; ● clinical trials of our product candidates may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon development programs; ● the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate, or participants may drop out of these clinical trials at a higher rate than we anticipate; ● our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all; ● we or our investigators might have to suspend or terminate clinical trials of our product candidates for various reasons, including non-compliance with regulatory requirements, a finding that our product candidates have undesirable side effects or other unexpected characteristics, or a finding that the participants are being exposed to unacceptable health risks; ● the cost of clinical trials of our product candidates may be greater than we anticipate, and we may not have funds to cover the costs; ● the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient or inadequate; ● business interruptions resulting from geopolitical actions, including war and terrorism, or a widespread health emergency, or natural disasters including earthquakes, typhoons, floods and fires, or from economic or political instability; and ● any future collaborators that conduct clinical trials may face any of the above issues, and they may conduct clinical trials in ways they view as advantageous to them but that are suboptimal for us.
The following examples are illustrative: ​ ● others may be able to make products that are the same as or similar to our product candidates but that are not covered by the claims of the patents that we own or have exclusively licensed; ​ ● others, including inventors or developers of our owned or in-licensed patented technologies who may become involved with competitors, may independently develop similar technologies that function as alternatives or replacements for any of our technologies without infringing our intellectual property rights; ​ ● we or our licensors or our other collaboration partners might not have been the first to conceive and reduce to practice the inventions covered by the patents or patent applications that we own, license or will own or license; ​ ● we or our licensors or our other collaboration partners might not have been the first to file patent applications covering certain of the patents or patent applications that we or they own or have obtained a license, or will own or will have obtained a license; ​ ● we or our licensors may fail to meet obligations to the U.S. government with respect to in-licensed patents and patent applications funded by U.S. government grants, leading to the loss of patent rights; ​ ● issued patents that we own or exclusively license may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors; and ​ ● our competitors might conduct research and development activities in countries where we do not have patent rights, or in countries where research and development safe harbor laws exist, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets. ​ Our reliance on third parties may require us to share our trade secrets, which increases the possibility that our trade secrets will be misappropriated or disclosed, and confidentiality agreements with employees and third parties may not adequately prevent disclosure of trade secrets and protect other proprietary information. ​ We consider proprietary trade secrets, confidential know-how and unpatented know-how to be important to our business.
The following examples are illustrative: ​ ● others may be able to make products that are the same as or similar to our product candidates but that are not covered by the claims of the patents that we own or have exclusively licensed; ​ ● others, including inventors or developers of our owned or in-licensed patented technologies who may become involved with competitors, may independently develop similar technologies that function as 100 Table of Contents alternatives or replacements for any of our technologies without infringing our intellectual property rights; ​ ● we or our licensors or our other collaboration partners might not have been the first to conceive and reduce to practice the inventions covered by the patents or patent applications that we own, license or will own or license; ​ ● we or our licensors or our other collaboration partners might not have been the first to file patent applications covering certain of the patents or patent applications that we or they own or have obtained a license, or will own or will have obtained a license; ​ ● we or our licensors may fail to meet obligations to the U.S. government with respect to in-licensed patents and patent applications funded by U.S. government grants, leading to the loss of patent rights; ​ ● issued patents that we own or exclusively license may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors; and ​ ● our competitors might conduct research and development activities in countries where we do not have patent rights, or in countries where research and development safe harbor laws exist, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets. ​ Our reliance on third parties may require us to share our trade secrets, which increases the possibility that our trade secrets will be misappropriated or disclosed, and confidentiality agreements with employees and third parties may not adequately prevent disclosure of trade secrets and protect other proprietary information. ​ We consider proprietary trade secrets, confidential know-how and unpatented know-how to be important to our business.
If we are unable to maintain 99 Table of Contents existing insurance with adequate levels of coverage, any significant uninsured liability may require us to pay substantial amounts, which would adversely affect our cash position and results of operations. ​ Our employees and independent contractors, including consultants, vendors, and any third parties we may engage in connection with development and commercialization may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could harm our business. ​ Misconduct by our employees and independent contractors, including consultants, vendors, and any third parties we may engage in connection with development and commercialization, could include intentional, reckless or negligent conduct or unauthorized activities that violate: (i) applicable laws and regulations of the FDA, MHRA, EMA and other regulatory or governmental authorities, including those laws that require the reporting of true, complete and accurate information to such authorities; (ii) manufacturing standards; (iii) data privacy and security, fraud and abuse and other healthcare laws and regulations; or (iv) laws that require the reporting of true, complete and accurate financial information and data.
If we are unable to maintain existing insurance with adequate levels of coverage, any significant uninsured liability may require us to pay substantial amounts, which would adversely affect our cash position and results of operations. ​ 104 Table of Contents Our employees and independent contractors, including consultants, vendors, and any third parties we may engage in connection with development and commercialization may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could harm our business. ​ Misconduct by our employees and independent contractors, including consultants, vendors, and any third parties we may engage in connection with development and commercialization, could include intentional, reckless or negligent conduct or unauthorized activities that violate: (i) applicable laws and regulations of the FDA, MHRA, EMA and other regulatory or governmental authorities, including those laws that require the reporting of true, complete and accurate information to such authorities; (ii) manufacturing standards; (iii) data privacy and security, fraud and abuse and other healthcare laws and regulations; or (iv) laws that require the reporting of true, complete and accurate financial information and data.
We expect to experience pricing pressures in connection with the sale of our product candidates due to the trend toward managed health care, the increasing influence of health maintenance organizations and additional legislative changes. The downward pressure on healthcare costs in general, particularly prescription drugs and biologics and surgical procedures and other treatments, has become intense.
We expect to experience pricing pressures in connection with the sale of our product candidates due to the trend toward managed healthcare, the increasing influence of health maintenance organizations and additional legislative changes. The downward pressure on healthcare costs in general, particularly prescription drugs and biologics and surgical procedures and other treatments, has become intense.
As a result, our owned 91 Table of Contents and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours. ​ Third parties may assert claims against us alleging infringement of their patents and proprietary rights, or we may need to become involved in lawsuits to defend or enforce our patents, either of which could result in substantial costs or loss of productivity, delay or prevent the development and commercialization of our product candidates, prohibit our use of proprietary technology or sale of products or put our patents and other proprietary rights at risk. ​ Our commercial success depends, in part, upon our ability to develop, manufacture, market and sell our product candidates without alleged or actual infringement, misappropriation or other violation of the patents and proprietary rights of third parties.
As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours. ​ Third parties may assert claims against us alleging infringement of their patents and proprietary rights, or we may need to become involved in lawsuits to defend or enforce our patents, either of which could result in substantial costs or loss of productivity, delay or prevent the development and commercialization of our product candidates, prohibit our use of proprietary technology or sale of products or put our patents and other proprietary rights at risk. ​ Our commercial success depends, in part, upon our ability to develop, manufacture, market and sell our product candidates without alleged or actual infringement, misappropriation or other violation of the patents and proprietary 96 Table of Contents rights of third parties.
If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, we may: ● incur unplanned costs; 60 Table of Contents ● be delayed in obtaining marketing approval for our product candidates or not obtain marketing approval at all; ● obtain marketing approval in some countries and not in others; ● obtain marketing approval for indications or patient populations that are not as broad as intended or desired; ● obtain marketing approval with labeling that includes significant use or distribution restrictions or safety warnings, including boxed warnings; ● be subject to additional post-marketing testing requirements; or ● have the product removed from the market after obtaining marketing approval.
If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other 63 Table of Contents testing, if the results of these trials or tests are not positive or are only modestly positive or if there are safety concerns, we may: ● incur unplanned costs; ● be delayed in obtaining marketing approval for our product candidates or not obtain marketing approval at all; ● obtain marketing approval in some countries and not in others; ● obtain marketing approval for indications or patient populations that are not as broad as intended or desired; ● obtain marketing approval with labeling that includes significant use or distribution restrictions or safety warnings, including boxed warnings; ● be subject to additional post-marketing testing requirements; or ● have the product removed from the market after obtaining marketing approval.
Data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval, which could negatively impact our business, financial condition, results of operations and prospects. ​ 70 Table of Contents The regulatory approval processes of the FDA, MHRA, competent authorities in the EU and other regulatory authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidates, our business will be substantially harmed. ​ The time required to obtain approval by the FDA, MHRA, European Commission and other regulatory authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities.
Data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval, which could negatively impact our business, financial condition, results of operations and prospects. ​ 74 Table of Contents The regulatory approval processes of the FDA, MHRA, competent authorities in the EU and other regulatory authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidates, our business will be substantially harmed. ​ The time required to obtain approval by the FDA, MHRA, European Commission and other regulatory authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities.
The lengthy approval process as well as the unpredictability of future clinical trial results may result in our failing to obtain regulatory approval to market our product candidates, which would significantly harm our business, results of operations and prospects. ​ 71 Table of Contents Even if we obtain FDA, MHRA or European Commission approval for our product candidates in the United States, UK or EU, we may never obtain approval for or commercialize them in any other jurisdiction, which would limit our ability to realize their full market potential. ​ In order to market any products in any particular jurisdiction, we must establish and comply with numerous and varying regulatory requirements on a country-by-country basis regarding safety and efficacy.
The lengthy approval process as well as the unpredictability of future clinical trial results may result in our failing to obtain regulatory approval to market our product candidates, which would significantly harm our business, results of operations and prospects. ​ 75 Table of Contents Even if we obtain FDA, MHRA or European Commission approval for our product candidates in the United States, UK or EU, we may never obtain approval for or commercialize them in any other jurisdiction, which would limit our ability to realize their full market potential. ​ In order to market any products in any particular jurisdiction, we must establish and comply with numerous and varying regulatory requirements on a country-by-country basis regarding safety and efficacy.
We expect that additional U.S. federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that the U.S. federal government will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures. ​ Individual states in the United States have also increasingly passed legislation and implemented 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.
We expect that additional U.S. federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that the U.S. federal government will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures. ​ Individual states in the United States have also increasingly passed legislation and implemented 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, drug price reporting and other transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
Our future financial performance and our ability to commercialize our product candidates and compete effectively will depend, in part, on our ability to effectively manage any future growth. Our expected growth could require significant capital expenditures and may divert financial resources from other projects, such as the development of additional product candidates.
Our future financial performance and our ability to commercialize our product candidates and compete effectively will depend, in part, on our ability to effectively manage any future growth. Our growth could require significant capital expenditures and may divert financial resources from other projects, such as the development of additional product candidates.
National governments and health service providers have different priorities and approaches to the delivery of health care and the pricing and reimbursement of products in that context. In general, however, the healthcare budgetary constraints in the UK and in most EU member states have resulted in restrictions on the pricing and reimbursement of medicines by relevant health service providers.
National governments and health service providers have different priorities and approaches to the delivery of healthcare and the pricing and reimbursement of products in that context. In general, however, the healthcare budgetary constraints in the UK and in most EU member states have resulted in restrictions on the pricing and reimbursement of medicines by relevant health service providers.
As a result, our right to claim certain reliefs from UK tax may be restricted, and changes in law or practice in the UK could result in the imposition of further restrictions on our right to claim UK tax reliefs. ​ We may be classified as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes, which could result in adverse U.S. federal income tax consequences to U.S. investors in our ordinary shares. ​ Based on the current and anticipated value of our assets, including goodwill, and the current and anticipated composition of our income, assets and operations, we do not believe we were a PFIC for the taxable year ended on December 31, 2023, and do not expect to be a PFIC for the current taxable year.
As a result, our right to claim certain reliefs from UK tax may be restricted, and changes in law or practice in the UK could result in the imposition of further restrictions on our right to claim UK tax reliefs. ​ We may be classified as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes, which could result in adverse U.S. federal income tax consequences to U.S. investors in our ordinary shares. ​ Based on the current and anticipated value of our assets, including goodwill, and the current and anticipated composition of our income, assets and operations, we do not believe we were a PFIC for the taxable year ended on December 31, 2024, and do not expect to be a PFIC for the current taxable year.
If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our share price or trading volume to decline. ​ Expectations relating to environmental, social and governance factors may impose additional costs and expose us to new risks. ​ There is an increasing focus from the SEC, stock exchanges, certain investors and other stakeholders concerning corporate responsibility, specifically related to environmental, social and governance factors.
If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our share price or trading volume to decline. ​ Expectations relating to environmental, social and governance factors may impose additional costs and expose us to new risks. ​ There is an increasing focus from the SEC, foreign regulators, stock exchanges, certain investors and other stakeholders concerning corporate responsibility, specifically related to environmental, social and governance factors.
There can be no assurance, however, that the policies and procedures will be followed at all times or effectively detect and prevent violations of the applicable laws by one or more of our employees, consultants, agents, or collaborators and, as a result, we could be subject to fines, penalties, or prosecution. ​ Risks Related to Commercialization ​ We face significant competition in an environment of rapid technological change, and there is a possibility that our competitors may achieve regulatory approval before us or develop therapies that are safer or more advanced or effective than ours, which may harm our financial condition and our ability to successfully market or commercialize any product candidates we may develop. ​ The development and commercialization of new gene therapy products is highly competitive.
There can be no assurance, however, that the policies and procedures will be followed at all times or effectively detect and prevent violations of the applicable laws by one or more of our employees, consultants, agents, or collaborators and, as a result, we could be subject to fines, penalties, or prosecution. ​ 85 Table of Contents Risks Related to Commercialization ​ We face significant competition in an environment of rapid technological change, and there is a possibility that our competitors may achieve regulatory approval before us or develop therapies that are safer or more advanced or effective than ours, which may harm our financial condition and our ability to successfully market or commercialize any product candidates we may develop. ​ The development and commercialization of new gene therapy products is highly competitive.
As a result, it may be difficult or impossible for investors to effect service of process upon us within the United States or other jurisdictions, including judgments predicated upon the civil liability provisions of the federal securities laws of the United States. ​ 104 Table of Contents In particular, investors should be aware that there is uncertainty as to whether the courts of the Cayman Islands or any other applicable jurisdictions would recognize and enforce judgments of U.S. courts obtained against us or our directors or management predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States or entertain original actions brought in the Cayman Islands or any other applicable jurisdiction’s courts against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States. ​ The rights of our shareholders differ from the rights typically offered to shareholders of a U.S. corporation. ​ Our corporate affairs and the rights of holders of ordinary shares are governed by Cayman Islands law, including the provisions of the Cayman Islands Companies Act (as amended), or the Companies Act, the common law of the Cayman Islands and by our memorandum and articles of association.
As a result, it may be difficult or impossible for investors to effect service of process upon us within the United States or other jurisdictions, including judgments predicated upon the civil liability provisions of the federal securities laws of the United States. ​ In particular, investors should be aware that there is uncertainty as to whether the courts of the Cayman Islands or any other applicable jurisdictions would recognize and enforce judgments of U.S. courts obtained against us or our directors or management predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States or entertain original actions brought in the Cayman Islands or any other applicable jurisdiction’s courts against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States. ​ The rights of our shareholders differ from the rights typically offered to shareholders of a U.S. corporation. ​ Our corporate affairs and the rights of holders of ordinary shares are governed by Cayman Islands law, including the provisions of the Cayman Islands Companies Act (as amended), or the Companies Act, the common law of the Cayman Islands and by our memorandum and articles of association.
To the extent that any disruption or security breach were to result in a loss of or damage to our data or applications, or inappropriate disclosure of personal, confidential or proprietary information, we could incur liability and the further development of our product candidates could be delayed. ​ In the ordinary course of our business, we, our business partners and our service providers collect, process and store sensitive data, including intellectual property, clinical trial data, proprietary business information, personal data and personally identifiable information of our clinical trial subjects and employees.
To the extent that any disruption or security breach were to result in a loss of or damage to our data or applications, or inappropriate disclosure of personal, confidential or proprietary information, we could incur liabilities and the further development of our product candidates could be delayed. ​ In the ordinary course of our business, we, our business partners and our service providers collect, process and store sensitive data, including intellectual property, clinical trial data, proprietary business information, personal data and personally identifiable information of our clinical trial subjects and employees.
If we fail to satisfy the expectations of investors and other stakeholders or our initiatives are not executed as planned, our reputation and financial results could be adversely affected. ​ Because we do not anticipate paying any cash dividends on our ordinary shares in the foreseeable future, capital appreciation, if any, would be your sole source of gain. ​ Under Cayman Islands law, we may only make distributions by way of dividend out of profits, or out of our share premium account (provided that immediately following the date that the dividend is proposed to be paid we are able to pay our debts as they fall due in the ordinary course of business).
If we fail to satisfy the expectations of investors and other stakeholders or our initiatives are not executed as planned, our reputation and financial results could be adversely affected. ​ Because we do not anticipate paying any cash dividends on our ordinary shares in the foreseeable future, capital appreciation, if any, would be your sole source of gain. ​ Under Cayman Islands law, we may only make distributions by way of dividend out of profits, or out of our share premium account (provided that immediately following the date that the dividend is proposed to be paid we are 113 Table of Contents able to pay our debts as they fall due in the ordinary course of business).
Coupled with ever-increasing national regulatory burdens on those wishing to develop and market products, this could prevent or delay marketing approval of our product candidates, restrict or regulate post-approval activities and affect our ability to commercialize our product candidates, if approved. ​ On December 13, 2021, Regulation No 2021/2282 on Health Technology Assessment, or HTA, amending Directive 2011/24/EU, was adopted.
Coupled with ever-increasing national regulatory burdens on those wishing to develop and market products, this could prevent or delay marketing approval of our product candidates, restrict or regulate post-approval activities and affect our ability to commercialize our product candidates, if approved. ​ On December 13, 2021, Regulation No 2021/2282 on Health Technology Assessment, or HTA, amending Directive 2011/24/EU, was adopted in the EU.
A person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation; ​ ● the U.S. federal civil and criminal false claims and civil monetary penalties laws, including the civil False Claims Act, which, among other things, impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the U.S. federal government, claims for payment or approval that are false or fraudulent, knowingly making, using or causing to be made or used, a false record or statement material to a false or fraudulent claim, or from knowingly making a false statement to avoid, decrease or conceal an obligation to pay money to the U.S. federal government.
A person 81 Table of Contents or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation; ​ ● the U.S. federal civil and criminal false claims and civil monetary penalties laws, including the civil False Claims Act, which, among other things, impose criminal and civil penalties, including through civil whistleblower or qui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the U.S. federal government, claims for payment or approval that are false or fraudulent, knowingly making, using or causing to be made or used, a false record or statement material to a false or fraudulent claim, or from knowingly making a false statement to avoid, decrease or conceal an obligation to pay money to the U.S. federal government.
The enrollment of patients depends on many factors, including: ● the size and nature of the patient population; ● the patient eligibility criteria defined in the protocol; ● the size of the patient population required for analysis of the trial’s primary endpoints; ● the proximity of patients to study sites; ● the design of the trial or side effects that may arise in development; 68 Table of Contents ● our ability to recruit clinical trial investigators with the appropriate competencies and experience; ● clinicians’ and patients’ perceptions as to the potential advantages of the product candidate being studied in relation to other available therapies, including any new products that may be approved for the indications we are investigating; ● our ability to obtain and maintain patient consents; ● the risk that patients enrolled in clinical trials will drop out of the trials before completion; and ● business interruptions resulting from geopolitical actions, including war and terrorism, or widespread health emergencies, such as the COVID-19 pandemic, or natural disasters including earthquakes, typhoons, floods and fires, or from economic or political instability. ​ In addition, other clinical trials for product candidates that are in the same therapeutic areas as our product candidates or approved products for the same clinical indications (such as Luxturna marketed by Spark Therapeutics, Inc. for the treatment of RPE65-associated retinal disease) may reduce the number and type of patients available to us.
The enrollment of patients depends on many factors, including: ● the size and nature of the patient population; ● the patient eligibility criteria defined in the protocol; ● the size of the patient population required for analysis of the trial’s primary endpoints; ● the proximity of patients to study sites; ● the design of the trial or side effects that may arise in development; 72 Table of Contents ● our ability to recruit clinical trial investigators with the appropriate competencies and experience; ● clinicians’ and patients’ perceptions as to the potential advantages of the product candidate being studied in relation to other available therapies, including any new products that may be approved for the indications we are investigating; ● our ability to obtain and maintain patient consents; ● the risk that patients enrolled in clinical trials will drop out of the trials before completion; and ● business interruptions resulting from geopolitical actions, including war and terrorism, or widespread health emergencies, or natural disasters including earthquakes, typhoons, floods and fires, or from economic or political instability. ​ In addition, other clinical trials for product candidates that are in the same therapeutic areas as our product candidates or approved products for the same clinical indications (such as Luxturna marketed by Spark Therapeutics, Inc. for the treatment of RPE65-associated retinal disease) may reduce the number and type of patients available to us.
Adverse events in our clinical trials, even if not ultimately attributable to our product candidates, and the resulting publicity could result in increased governmental regulation, unfavorable public perception, potential regulatory delays in the testing or approval of our product candidates or the halting of clinical trials, stricter labeling requirements for those product candidates that are approved and a decrease in demand for any such product 63 Table of Contents candidates.
Adverse events in our clinical trials, even if not ultimately attributable to our product candidates, and the resulting publicity could result in increased governmental regulation, unfavorable public perception, potential regulatory delays in the testing or approval of our product candidates 66 Table of Contents or the halting of clinical trials, stricter labeling requirements for those product candidates that are approved and a decrease in demand for any such product candidates.
Furthermore, the magnitude of the economic impact of any pandemic including sustained inflation, supply chain disruptions, and major central bank policy actions may result in 62 Table of Contents significant disruption of global financial markets, which could materially affect our performance, financial condition, results of operations, and cash flows, as well as our ability to raise additional capital.
Furthermore, the magnitude of the economic impact of any pandemic including sustained inflation, supply chain 65 Table of Contents disruptions, and major central bank policy actions may result in significant disruption of global financial markets, which could materially affect our performance, financial condition, results of operations, and cash flows, as well as our ability to raise additional capital.
In addition, the government may assert that a claim including items and services resulting from a violation of the U.S. federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act; ​ ● the U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created additional federal criminal statutes which prohibit, among other things, knowingly and willfully 77 Table of Contents executing, or attempting to execute, a scheme to defraud any healthcare benefit program, or knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement, in connection with the delivery of, or payment for, healthcare benefits, items or services.
In addition, the government may assert that a claim including items and services resulting from a violation of the U.S. federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act; ​ ● the U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created additional federal criminal statutes which prohibit, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, or knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement, in connection with the delivery of, or payment for, healthcare benefits, items or services.
If we are unable to establish and maintain collaborative relationships on acceptable terms or to successfully transition terminated collaborative agreements, we may have to delay or discontinue further development of one or more of our product candidates, undertake development and commercialization activities at our own expense or find alternative sources of capital. ​ We have relied, and we expect to continue to rely, on third parties to conduct, supervise and monitor our preclinical studies and clinical trials, and if these third parties perform in an unsatisfactory manner, our business could be harmed. ​ We expect to rely on CROs, clinical trial sites, and other vendors to ensure our preclinical studies and clinical trials are conducted properly and on time.
If we are unable to establish and maintain collaborative relationships on acceptable terms or to successfully transition terminated collaborative agreements, we may have to delay or discontinue further development of one or more of our product candidates, undertake development and commercialization activities at our own expense or find alternative sources of capital. ​ 93 Table of Contents We have relied, and we expect to continue to rely, on third parties to conduct, supervise and monitor our preclinical studies and clinical trials, and if these third parties perform in an unsatisfactory manner, our business could be harmed. ​ We expect to rely on CROs, clinical trial sites, and other vendors to ensure our preclinical studies and clinical trials are conducted properly and on time.
The actual or perceived failure to comply with such obligations could materially harm our business. ​ The global data protection landscape is rapidly evolving, and we are or may become subject to numerous state, federal and foreign laws, requirements and regulations governing the collection, use, access to, confidentiality, disclosure, storage, processing, retention and security of personal information such as information that we may collect in connection with clinical trials in the U.S. and abroad. ​ In the U.S., HIPAA imposes privacy, security and breach reporting obligations with respect to individually identifiable health information upon “covered entities” (health plans, health care clearinghouses and certain health care providers), and their respective business associates, individuals or entities that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity, as well as their covered subcontractors.
The actual or perceived failure to comply with such obligations could materially harm our business. ​ The global data protection landscape is continually evolving, and we are or may become subject to numerous state, federal and foreign laws, requirements and regulations governing the collection, use, access to, confidentiality, disclosure, storage, processing, retention and security of personal information such as information that we may collect in connection with clinical trials in the U.S. and abroad. ​ In the U.S., HIPAA imposes privacy, security and breach reporting obligations with respect to individually identifiable health information upon “covered entities” (health plans, healthcare clearinghouses and certain healthcare providers), and their respective business associates, individuals or entities that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity, as well as their covered subcontractors.
If some investors find our ordinary shares less attractive as a result, there may be a less active trading market for our ordinary shares and our share price may be more volatile. ​ Anti-takeover provisions in our organizational documents and Cayman Islands law may discourage or prevent a change of control, even if an acquisition would be beneficial to our shareholders, which could depress the price of our ordinary shares and prevent attempts by our shareholders to replace or remove our current management. ​ Our memorandum and articles of association contain provisions that may discourage unsolicited takeover proposals that shareholders may consider to be in their best interests.
If some investors find our ordinary shares less attractive as a result, there may be a less active trading market for our ordinary shares and our share price may be more volatile. ​ 108 Table of Contents Anti-takeover provisions in our organizational documents and Cayman Islands law may discourage or prevent a change of control, even if an acquisition would be beneficial to our shareholders, which could depress the price of our ordinary shares and prevent attempts by our shareholders to replace or remove our current management. ​ Our memorandum and articles of association contain provisions that may discourage unsolicited takeover proposals that shareholders may consider to be in their best interests.
In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States. ​ As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would as public shareholders of a United States company. ​ We expect to be treated as resident in the UK for tax purposes, but may be treated as a dual resident company for UK tax purposes. ​ Our board of directors conducts our affairs so that the central management and control of the company is exercised in the UK.
In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States. ​ As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would as public shareholders of a United States company. ​ 109 Table of Contents We expect to be treated as resident in the UK for tax purposes, but may be treated as a dual resident company for UK tax purposes. ​ Our board of directors conducts our affairs so that the central management and control of the company is exercised in the UK.
Without an internal team or the support of a third party to perform marketing and sales functions, we may be unable to compete successfully against these more established companies. ​ If any of our products are commercialized outside of the United States, the UK or the EU, a variety of risks associated with international operations could adversely affect our business. ​ If any of our products are approved for commercialization, we have entered into, and intend to enter into, agreements with third parties to market them in certain jurisdictions outside the United States, the UK and the EU.
Without an internal team or the support of a third party to perform marketing and sales functions, we may be unable to compete successfully against these more established companies. ​ 89 Table of Contents If any of our products are commercialized outside of the United States, the UK or the EU, a variety of risks associated with international operations could adversely affect our business. ​ If any of our products are approved for commercialization, we have entered into, and intend to enter into, agreements with third parties to market them in certain jurisdictions outside the United States, the UK and the EU.
If we are unable to successfully manage the challenges of international expansion and operations, our business and operating results could be harmed. ​ Any product candidates for which we intend to seek approval as biologic products may face competition sooner than anticipated. ​ The ACA includes a subtitle called the Biologics Price Competition and Innovation Act of 2009, or BPCIA, which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product.
If we are unable to successfully manage the challenges of international expansion and operations, our business and operating results could be harmed. ​ 90 Table of Contents Any product candidates for which we intend to seek approval as biologic products may face competition sooner than anticipated. ​ The ACA includes a subtitle called the Biologics Price Competition and Innovation Act of 2009, or BPCIA, which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable with an FDA-licensed reference biological product.
In addition, the Leahy-Smith America Invents Act, or the AIA, which was passed in September 2011, resulted in significant changes to the U.S. patent system. ​ An important change introduced by the AIA is that, as of March 16, 2013, the United States transitioned from a “first-to-invent” to a “first-to-file” system for deciding which party should be granted a patent when two or more patent applications are filed by different parties claiming the same invention.
In addition, the Leahy-Smith America Invents Act, or the AIA, which was passed in September 2011, resulted in significant changes to the U.S. patent system. ​ An important change introduced by the AIA is that, as of March 16, 2013, the United States transitioned from a “first-to-invent” to a “first-to-file” system for deciding which party should be granted a patent when two or more patent 98 Table of Contents applications are filed by different parties claiming the same invention.
We expect that we and our third-party collaborators will be subject to additional risks related to international pharmaceutical operations, including: ​ ● different regulatory requirements for drug and biologic approvals and rules governing drug and biologic commercialization in foreign countries; ​ ● tighter restrictions on data privacy and security and the collection and use of patient data; ​ ● reduced or loss of protection for intellectual property rights; ​ ● foreign reimbursement, pricing and insurance regimes; ​ ● unexpected changes in tariffs, trade barriers and regulatory requirements; ​ ● economic weakness, including inflation, or political instability in particular foreign economies and markets; ​ ● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country; ​ ● business interruptions resulting from geopolitical actions, including war and terrorism, or widespread health emergencies, such as the COVID-19 pandemic, or natural disasters including earthquakes, typhoons, floods and fires, or from economic or political instability; ​ ● greater difficulty with enforcing our contracts; ​ ● potential noncompliance with the FCPA, the Bribery Act and similar anti-bribery and anticorruption laws in other jurisdictions; ​ ● production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and 85 Table of Contents ​ ● workforce uncertainty in countries where labor unrest is more common than in the United States and compliance with tax, employment, immigration and labor laws for employees living or traveling abroad. ​ We have no prior experience in these areas and we may rely on other third parties to help us establish our international commercialization operations.
We expect that we and our third-party collaborators will be subject to additional risks related to international pharmaceutical operations, including: ​ ● different regulatory requirements for drug and biologic approvals and rules governing drug and biologic commercialization in foreign countries; ​ ● tighter restrictions on data privacy and security and the collection and use of patient data; ​ ● reduced or loss of protection for intellectual property rights; ​ ● foreign reimbursement, pricing and insurance regimes; ​ ● unexpected changes in tariffs, trade barriers and regulatory requirements; ​ ● economic weakness, including inflation, or political instability in particular foreign economies and markets; ​ ● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country; ​ ● business interruptions resulting from geopolitical actions, including war and terrorism, or widespread health emergencies, or natural disasters including earthquakes, typhoons, floods and fires, or from economic or political instability; ​ ● greater difficulty with enforcing our contracts; ​ ● potential noncompliance with the FCPA, the Bribery Act and similar anti-bribery and anticorruption laws in other jurisdictions; ​ ● production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and ​ ● workforce uncertainty in countries where labor unrest is more common than in the United States and compliance with tax, employment, immigration and labor laws for employees living or traveling abroad. ​ We have no prior experience in these areas and we may rely on other third parties to help us establish our international commercialization operations.
Even if we receive approval to market our product candidates from the FDA, MHRA or other regulatory bodies, we cannot be certain that our product candidates will be successfully commercialized by us or our collaborators, widely accepted in the marketplace or more effective than other commercially available alternatives.
Even if we receive approval to market our product candidates from the FDA, MHRA or other regulatory bodies, we cannot be certain that our product candidates will be successfully commercialized by us or any of our collaborators, widely accepted in the marketplace or more effective than other commercially available alternatives.
Further, competitors may be developing products with similar technology and may experience problems with their products that could identify problems that would potentially harm our business. 55 Table of Contents We may not be successful in our efforts to identify additional product candidates. Part of our strategy involves identifying novel product candidates.
Further, competitors may be developing products with similar technology and may experience problems with their products that could identify problems that would potentially harm our business. 58 Table of Contents We may not be successful in our efforts to identify additional product candidates. Part of our strategy involves identifying novel product candidates.
These new laws or any other similar laws introduced in the future may result in additional reductions in Medicare and other health care funding, which could negatively affect our customers and accordingly, our financial operations. ​ Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives.
These new laws or any other similar laws introduced in the future may result in additional reductions in Medicare and other healthcare funding, which could negatively affect our customers and accordingly, our financial operations. ​ Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives.
Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business. ​ 93 Table of Contents Changes in patent laws or patent jurisprudence could diminish the value of patents in general, thereby impairing our ability to protect our product candidates. ​ Obtaining and enforcing patents in the biotechnology and genetic medicine industries involve both technological complexity and legal complexity.
Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business. ​ Changes in patent laws or patent jurisprudence could diminish the value of patents in general, thereby impairing our ability to protect our product candidates. ​ Obtaining and enforcing patents in the biotechnology and genetic medicine industries involve both technological complexity and legal complexity.
Any performance failure on the part of our existing or future manufacturers could delay clinical development or marketing approval. ​ Our current and anticipated future dependence upon others for the manufacture of any product candidates we may develop or any components required for the manufacture of our product candidates may adversely affect our future profit margins and our ability to commercialize any product candidates that receive marketing approval on a timely and competitive basis. ​ 87 Table of Contents We have in the past, and may in the future, collaborate with third parties for the development, manufacture and commercialization of our product candidates.
Any performance failure on the part of our existing or future manufacturers could delay clinical development or marketing approval. ​ Our current and anticipated future dependence upon others for the manufacture of any product candidates we may develop or any components required for the manufacture of our product candidates may adversely affect our future profit margins and our ability to commercialize any product candidates that receive marketing approval on a timely and competitive basis. ​ We have in the past, and may in the future, collaborate with third parties for the development, manufacture and commercialization of our product candidates.
If a defendant were to prevail on a legal assertion of invalidity or unenforceability, we would lose at least part, and perhaps all, of the patent protection on our product candidates. ​ Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our technical and management personnel from their normal responsibilities.
If a defendant were to prevail on a legal assertion of invalidity or unenforceability, we would lose at least part, and perhaps all, of the patent protection on our product candidates. ​ Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our technical and management personnel from their normal 97 Table of Contents responsibilities.
Under such circumstances, trade secrets and confidential know-how can be difficult to maintain as confidential. ​ To protect this type of information against disclosure or appropriation by competitors, our policy is to require our employees, consultants, contractors and advisors to enter into confidentiality agreements and, if applicable, material 96 Table of Contents transfer agreements, consulting agreements or other similar agreements with us prior to beginning research or disclosing proprietary information.
Under such circumstances, trade secrets and confidential know-how can be difficult to maintain as confidential. ​ To protect this type of information against disclosure or appropriation by competitors, our policy is to require our employees, consultants, contractors and advisors to enter into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with us prior to beginning research or disclosing proprietary information.
If we are unable to continue to attract and retain high quality personnel, our ability to develop and commercialize product candidates will be limited. ​ 98 Table of Contents Potential product liability lawsuits against us could cause us to incur substantial liabilities and limit commercialization of any products that we may develop. ​ The use of our product candidates in clinical trials and the sale of any products for which we obtain marketing approval exposes us to the risk of product liability claims.
If we are unable to continue to attract and retain high quality personnel, our ability to develop and commercialize product candidates will be limited. ​ Potential product liability lawsuits against us could cause us to incur substantial liabilities and limit commercialization of any products that we may develop. ​ The use of our product candidates in clinical trials and the sale of any products for which we obtain marketing approval exposes us to the risk of product liability claims.
These products may compete with our product candidates, and our or our licensors’ patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. ​ 94 Table of Contents The laws of some jurisdictions do not protect intellectual property rights to the same extent as the laws or regulations in the United States, the UK and the EU, and many companies have encountered significant difficulties in protecting and defending proprietary rights in such jurisdictions.
These products may compete with our product candidates, and our or our licensors’ patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. ​ The laws of some jurisdictions do not protect intellectual property rights to the same extent as the laws or regulations in the United States, the UK and the EU, and many companies have encountered significant difficulties in protecting and defending proprietary rights in such jurisdictions.
Changes in funding for, or disruptions caused by global health concerns impacting, the FDA and other government or regulatory agencies could hinder their ability to hire and retain key leadership and other personnel, or otherwise prevent new products and services from being developed, approved or commercialized in a timely manner, which could negatively impact our business. ​ The ability of the FDA and foreign regulatory authorities to review and approve new products can be affected by a variety of factors, including government budget and funding levels, disruptions caused by global health concerns such as the COVID-19 pandemic, ability to hire and retain key personnel, including those with experience relating to novel gene therapy product candidates, acceptance of the payment of user fees, statutory, regulatory, and policy changes and other events that may otherwise affect the FDA’s or foreign regulatory authorities’ ability to perform routine functions.
Changes in funding for, or disruptions caused by global health concerns impacting, the FDA and other government or regulatory agencies could hinder their ability to hire and retain key leadership and other personnel, or otherwise prevent new products and services from being developed, approved or commercialized in a timely manner, which could negatively impact our business. ​ The ability of the FDA and foreign regulatory authorities to review and approve new products can be affected by a variety of factors, including government budget and funding levels, disruptions caused by global health concerns, ability to hire and retain key personnel, including those with experience relating to novel gene therapy product candidates, acceptance of the payment of user fees, statutory, regulatory, and policy changes and other events that may otherwise affect the FDA’s or foreign regulatory authorities’ ability to perform routine functions.
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare beginning in 2026, with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare beginning in 2026, with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount program with a new manufacturer discounting program (which began in 2025).
In addition, as a result of the expiration or successful challenge of our patent rights, we could face more litigation with respect to the validity and/or scope of patents relating to our competitors’ products. ​ The successful commercialization of our product candidates will depend in part on the extent to which governmental authorities and health insurers establish coverage, adequate reimbursement levels and pricing policies.
In addition, as a result of the expiration or successful challenge of our patent rights, we could face more litigation with respect to the validity and/or scope of patents relating to our competitors’ products. ​ 86 Table of Contents The successful commercialization of our product candidates will depend in part on the extent to which governmental authorities and health insurers establish coverage, adequate reimbursement levels and pricing policies.
Proceedings to enforce our patent rights in foreign jurisdictions, whether or not successful, are likely to result in substantial costs and divert our efforts and attention from other aspects of our business, and additionally could put at risk our or our licensors’ patents of being invalidated or interpreted narrowly, could increase the risk of our or our licensors’ patent applications not issuing, or could provoke third parties to assert claims against us.
Proceedings to enforce our patent rights in foreign jurisdictions, whether or not successful, are likely to result in substantial costs and divert our efforts and attention from other aspects of our business, and additionally could put at risk our or our licensors’ patents of being invalidated or interpreted narrowly, could increase the risk of our or our licensors’ patent applications not issuing, or could provoke 99 Table of Contents third parties to assert claims against us.
The resulting reduction in revenue from applicable products could be substantial. ​ 95 Table of Contents Our proprietary rights may not adequately protect our technologies and product candidates, and do not necessarily address all potential threats to our competitive advantage. ​ The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and may not adequately protect our business, or permit us to maintain our competitive advantage.
The resulting reduction in revenue from applicable products could be substantial. ​ Our proprietary rights may not adequately protect our technologies and product candidates, and do not necessarily address all potential threats to our competitive advantage. ​ The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and may not adequately protect our business, or permit us to maintain our competitive advantage.
In this regard, we will need to continue to dedicate internal resources, potentially engage outside consultants, adopt a detailed work plan to assess and document the adequacy of internal control over financial reporting, continue steps to improve control processes as appropriate, validate through testing whether such controls are functioning as documented, and implement a continuous reporting and improvement process for internal control over financial reporting.
In this regard, we will need to continue to dedicate internal resources, potentially engage outside consultants, adopt a detailed work plan to assess 112 Table of Contents and document the adequacy of internal control over financial reporting, continue steps to improve control processes as appropriate, validate through testing whether such controls are functioning as documented, and implement a continuous reporting and improvement process for internal control over financial reporting.
Relying on third parties increases the risk that we will not have sufficient quantities of such materials, product candidates, or any medicines that we may develop and commercialize, or that such supply will not be available to us at an acceptable cost, which could delay, prevent, or impair our development or commercialization efforts. ​ We produce our product candidates in our GMP viral vector manufacturing facility completed in early 2018 and our second, large scale GMP viral vector manufacturing facility and our first GMP plasmid and DNA production facility came online in 2022.
Relying on third parties increases the risk that we will not have sufficient quantities of such materials, product candidates, or any medicines that we may develop and commercialize, or that such supply will not be available to us at an acceptable cost, which could delay, prevent, or impair our development or commercialization efforts. ​ We produce our product candidates in our GMP viral vector manufacturing facility in London, UK, completed in early 2018, and our second, large scale GMP viral vector manufacturing facility and our first GMP plasmid and DNA production facility came online in 2022 in Shannon, Ireland.
U.S. holders of our ordinary shares should consult their tax advisors regarding the potential application of these rules to their investment in our ordinary shares. ​ Changes in tax laws or challenges to our tax position could adversely affect our results of operations and financial condition. ​ We are subject to complex tax laws that are subject to change or differing interpretations, including on a retroactive basis.
U.S. holders of our ordinary shares should consult their tax advisors regarding the potential application of these rules to their investment in our ordinary shares. 110 Table of Contents ​ Changes in tax laws or challenges to our tax position could adversely affect our results of operations and financial condition. ​ We are subject to complex tax laws that are subject to change or differing interpretations, including on a retroactive basis.
We have invested and expect to continue to invest a meaningful portion of our efforts and expenditures over the next few years in the development of AAV-hAQP1, AAV-GAD, AAV-CNGB3, AAV-CNGA3, AAV-RPE65 and our riboswitch gene regulation technology platform, which will require additional clinical development, management of clinical and manufacturing activities, regulatory approval in multiple jurisdictions, manufacturing sufficient supply, building of a commercial organization, substantial investment and significant marketing efforts before we can generate any revenues from any commercial sales.
We have invested and expect to continue to invest a meaningful portion of our efforts and expenditures over the next few years in the development of AAV-hAQP1, AAV-GAD, AAV-AIPL1 and our riboswitch gene regulation technology platform, as well as potentially AAV-CNGB3, AAV-CNGA3, AAV-RPE65, which will require additional clinical development, management of clinical and manufacturing activities, regulatory approval in multiple jurisdictions, manufacturing sufficient supply, building of a commercial organization, substantial investment and significant marketing efforts before we can generate any revenues from any commercial sales.
Since our inception, we have devoted substantially all of our resources to developing our technology platform, establishing our viral vector manufacturing facilities and plasmid and DNA production facility, developing manufacturing processes, advancing the product candidates in our ophthalmology, salivary gland and neurodegenerative disease programs, research and development activities, building our intellectual property portfolio, organizing and staffing our company, developing our business plans, raising capital, securing debt financing and providing general and administrative support for these operations.
Since our inception, we have devoted substantially all of our resources to developing our technology platform, establishing our viral vector manufacturing facilities and plasmid and DNA production facility, developing manufacturing processes, advancing the product candidates in our ophthalmology, salivary gland and neurodegenerative disease programs, research and development activities, including our riboswitch gene regulation platform technology, building our intellectual property portfolio, organizing and staffing our company, developing our business plans, raising capital, securing debt financing and providing general and administrative support for these operations.
Likewise, in the EU and Great Britain, the European Commission or MHRA, respectively, can authorize a similar product for the same therapeutic indication, if it concludes that the later product is safer, more effective or clinically superior; if the MA holder for the initial orphan medicinal product grants its consent; or if such MA holder is unable to supply sufficient quantities of the product.
Likewise, in the EU and UK, the European Commission or MHRA, respectively, can authorize a similar product for the same therapeutic indication, if it concludes that the later product is safer, more effective or clinically superior; if the MA holder for the initial orphan medicinal product grants its consent; or if such MA holder is unable to supply sufficient quantities of the product.
In 2017, the FDA approved the first gene treatment for RPE65-associated retinal disease, Luxturna, a commercially available product developed by Spark Therapeutics, Inc., which was purchased by Roche. There are a number of other companies 81 Table of Contents developing ocular gene therapy products, including Applied Genetic Technologies Corporation, and 4D Molecular Therapeutics, Inc.
In 2017, the FDA approved the first gene treatment for RPE65-associated retinal disease, Luxturna, a commercially available product developed by Spark Therapeutics, Inc., which was purchased by Roche. There are a number of other companies developing ocular gene therapy products, including Applied Genetic Technologies Corporation, and 4D Molecular Therapeutics, Inc.
We may realize losses in the fair value of certain of our investments or a complete loss of these investments if the credit markets tighten, which would have an adverse effect on our results of operations, liquidity and financial condition. ​ We incur substantial costs as a result of operating as a public company, and our management is required to devote substantial time to new compliance initiatives and corporate governance practices. ​ As a public company, and particularly since we no longer qualify as an emerging growth company and if we no longer qualify as a smaller reporting company or a non-accelerated filer in the future, we incur and will continue to incur significant legal, accounting and other expenses that we did not incur as a private company.
We may realize losses in the fair value of certain of our investments or a complete loss of these investments if the credit markets tighten, which would have an adverse effect on our results of operations, liquidity and financial condition. ​ We incur substantial costs as a result of operating as a public company, and our management is required to devote substantial time to new and existing compliance initiatives and corporate governance practices. ​ As a public company, and particularly since we no longer qualify as an emerging growth company and if we no longer qualify as a smaller reporting company or a non-accelerated filer in the future, we incur and will continue to incur significant legal, accounting and other expenses.
This period may be reduced to six years if, at the end of the fifth year, the orphan designation criteria are no longer met, including where it is shown that the product is sufficiently profitable not to justify maintenance of market exclusivity, or where the prevalence of the condition has increased above the orphan designation threshold.
This period may be reduced to six years if, at the end of the fifth year, the orphan designation criteria are no longer met, including where it is shown that the product is sufficiently profitable not to justify maintenance of market 68 Table of Contents exclusivity, or where the prevalence of the condition has increased above the orphan designation threshold.
Any contamination could adversely affect our ability to produce product candidates on schedule and could, therefore, harm our results of operations and cause reputational damage. Some of the raw materials required in our manufacturing process are derived from biologic sources. 67 Table of Contents Such raw materials are difficult to procure and may be subject to contamination or recall.
Any contamination could adversely affect our ability to produce product candidates on schedule and could, therefore, harm our results of operations and cause reputational damage. Some of the raw materials required in our manufacturing process are derived from biologic sources. Such raw materials are difficult to procure and may be subject to contamination or recall.
Accordingly, in the event of contamination or injury, we could be held liable for damages or be penalized with fines in an amount exceeding our resources, and our clinical trials or regulatory approvals could be suspended. ​ Operating as a public company may make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage.
Accordingly, in the event of contamination or injury, we could be held liable for damages or be penalized with fines in an amount exceeding our resources, and our clinical trials or regulatory approvals could be suspended. ​ Operating as a public company may make it more difficult and more expensive for us to obtain directors’ and officers’ liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage.
We are not permitted to market our product candidates in the United States until they receive approval of a biologics license application, or BLA, from the FDA, we cannot market them in the UK or EU until we receive approval for an MA, from the MHRA or European Commission, respectively, and we cannot market them in other countries until we receive any other required regulatory approval in those countries.
We are not permitted to market our product candidates in the United States until they receive approval of a BLA from the FDA, we cannot market them in the UK or EU until we receive approval for an MA, from the MHRA or European Commission, respectively, and we cannot market them in other countries until we receive any other required regulatory approval in those countries.
In addition, delays in receipt of or failure to receive regulatory clearances or approvals for any other products would harm our business, financial condition, and results of operations. ​ In the UK and EU, similar political, economic and regulatory developments may affect our ability to profitably commercialize our product candidates, if approved.
In addition, delays in receipt of or failure to receive regulatory clearances or approvals for any other products would harm our business, financial condition, and results of operations. ​ 80 Table of Contents In the UK and EU, similar political, economic and regulatory developments may affect our ability to profitably commercialize our product candidates, if approved.
This estimate does not include the $285.0 million in milestones we are eligible to receive under the Asset Purchase Agreement upon first commercial sale of an RPGR Product in the United States and in at least one of the United Kingdom, France, Germany, Spain and Italy, for completion of the transfer of certain manufacturing technology to Janssen and upon regulatory approval of a Janssen-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
This estimate does not include the $285.0 million in milestones we are eligible to receive under the Asset Purchase Agreement upon first commercial sale of an RPGR Product in the United States and in at least one of the United Kingdom, France, Germany, Spain and Italy, for completion of the transfer of certain manufacturing technology to Johnson & Johnson Innovative Medicine and upon regulatory approval of a Johnson & Johnson Innovative Medicine-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
We may not succeed in establishing and maintaining collaborative relationships, which may significantly limit our ability to develop and commercialize our product candidates successfully, if at all. ​ We have entered into collaboration agreements with third parties for the development and commercialization of our product candidates, including the Collaboration Agreement with Janssen for the development and commercialization of AAV-CNGB3, AAV-CNGA3 and bota-vec, which Collaboration Agreement was terminated in December 2023 in connection with our entering into the Asset Purchase Agreement with Janssen.
We may not succeed in establishing and maintaining collaborative relationships, which may significantly limit our ability to develop and commercialize our product candidates successfully, if at all. ​ We have entered into collaboration agreements with third parties for the development and commercialization of our product candidates, including the Collaboration Agreement with Johnson & Johnson Innovative Medicine for the development and commercialization of AAV-CNGB3, AAV-CNGA3 and bota-vec, which Collaboration Agreement was terminated in December 2023 in connection with our entering into the Asset Purchase Agreement with Johnson & Johnson Innovative Medicine.
The Bribery Act, FCPA, and these other laws generally prohibit us, our officers and our 80 Table of Contents employees and intermediaries from bribing, being bribed by, or providing prohibited payments or anything else of value to government officials or other persons to obtain or retain business or gain some other business advantage.
The Bribery Act, FCPA, and these other laws generally prohibit us, our officers and our employees and intermediaries from bribing, being bribed by, or providing prohibited payments or anything else of value to government officials or other persons to obtain or retain business or gain some other business advantage.
If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize our product candidates and may not be able to obtain a satisfactory financial return on our product candidates. ​ 82 Table of Contents There is significant uncertainty related to the insurance coverage and reimbursement of newly-approved products.
If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize our product candidates and may not be able to obtain a satisfactory financial return on our product candidates. ​ There is significant uncertainty related to the insurance coverage and reimbursement of newly-approved products.
However, if our current facilities are damaged, suffer any form of delay or regulatory challenges, we experience slowdowns or problems with our facilities or we are unable to scale our internal manufacturing capabilities to 86 Table of Contents meet demand for our product candidates, we will need to contract with third-party manufacturers to produce our product candidates.
However, if our current facilities are damaged, suffer any form of delay or regulatory challenges, we experience slowdowns or problems with our facilities or we are unable to scale our internal manufacturing capabilities to meet demand for our product candidates, we will need to contract with third-party manufacturers to produce our product candidates.
Expanding our manufacturing capacity to produce the preclinical, clinical and commercial supply of our products and their components, as well as our obligations under the Supply Agreement with Janssen if the RPGR Product is successfully commercialized, has required and will continue to require substantial additional expenditures, time, and various regulatory approvals and permits, as well as hiring, training and retraining employees and managerial personnel to staff our manufacturing and supply chain operations.
Expanding our manufacturing capacity to produce the preclinical, clinical and commercial supply of our products and their components, as well as our obligations under the Supply Agreement with Johnson & Johnson Innovative Medicine if the RPGR Product is successfully commercialized, has required and will continue to require substantial additional expenditures, time, and various regulatory approvals and permits, as well as hiring, training and retraining employees and managerial personnel to staff our manufacturing and supply chain operations.
We do not have a long-term supply agreement with any of the third-party manufacturers, and we purchase our required supply on a purchase order basis. ​ We and our third-party manufacturers may also encounter difficulties or delays in manufacturing of our product candidates or the plasmid used in the production of our product candidates.
We do not have a long-term supply agreement with any of the third-party manufacturers, and we purchase our required supply on a purchase order basis. 91 Table of Contents ​ We and our third-party manufacturers may also encounter difficulties or delays in manufacturing of our product candidates or the plasmid used in the production of our product candidates.
Even if we were ultimately to prevail, any of these events 92 Table of Contents could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business. ​ Competitors may infringe our patents or other intellectual property.
Even if we were ultimately to prevail, any of these events could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business. ​ Competitors may infringe our patents or other intellectual property.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity risk management program is integrated into our overall enterprise risk management program, and includes: ● risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; 109 Table of Contents ● security controls and mitigation measures designed to manage and mitigate material risks from cybersecurity threats to our critical systems and information; ● an IT and security team responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls and mitigation measures, and (3) our response to cybersecurity incidents; ● the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; ● cybersecurity awareness training of our employees, IT and security personnel and senior management; ● a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and ● a risk-based approach to identifying and overseeing third party cybersecurity risks, including evaluating the cybersecurity processes of service providers and other vendors, and reviewing available security certifications and independent audit reports.
Biggest changeOur cybersecurity risk management program is integrated into our overall enterprise risk management program, and includes: ● risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment; ● security controls and mitigation measures designed to manage and mitigate material risks from cybersecurity threats to our critical systems and information; ● an IT and security team responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls and mitigation measures, and (3) our response to cybersecurity incidents; ● the use of external service providers , where appropriate, to assess, test or otherwise assist with aspects of our security controls; ● cybersecurity awareness training of our employees, IT and security personnel and senior management; ● a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and ● a risk-based approach to identifying and overseeing third party cybersecurity risks, including evaluating the cybersecurity processes of service providers and other vendors, and reviewing available security certifications and independent audit reports.
For more information regarding how cybersecurity risks may affect us, see “Item 1A Risk Factors.” Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and has delegated oversight of cybersecurity and other IT risks to the Audit Committee. The Audit Committee oversees management’s implementation of our cybersecurity risk management program.
For more information regarding how cybersecurity risks may affect us, see “Item 1A Risk Factors.” 114 Table of Contents Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and has delegated oversight of cybersecurity and other IT risks to the Audit Committee. The Audit Committee oversees management’s implementation of our cybersecurity risk management program.
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Our management team, including the Vice President, Global IT and Senior Vice President, Risk and Internal Controls, is responsible for assessing and managing our material risks from cybersecurity threats. The team has primary 110 Table of Contents responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our external cybersecurity consultants.
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Our Vice President, Global IT has more than 15 years’ experience leading teams in cybersecurity, designing and securing critical IT infrastructure in the sports entertainment, healthcare and biotech sectors.
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Our Senior Vice President, Risk and Internal Controls has more than 30 years’ experience designing, implementing and leading risk management, internal control and compliance programs including cybersecurity, data privacy and business resilience.
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Our management team supervises efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the IT environment.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe office space lease terminates on September 8, 2029 and the laboratory leases terminate on May 24, 2027. ITEM 3. LEGAL PROCEEDINGS We are not subject to any material legal proceedings. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. ​ 111 Table of Contents PART II
Biggest changeThe office space lease terminates on September 8, 2029 and the laboratory leases terminate on May 24, 2027. ITEM 3. LEGAL PROCEEDINGS We are not subject to any material legal proceedings. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. ​ 115 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeHowever, if we do pay a cash dividend on our ordinary shares in the future, we will only pay such dividend out of our profits or share premium (subject to solvency requirements) as permitted under Cayman Islands law.
Biggest changeHowever, if we do pay a cash dividend on our ordinary shares in the future, we will only pay such dividend out of our profits or share premium (subject to solvency requirements) as permitted under Cayman Islands law. Recent Sales of Unregistered Securities None. ITEM 6. [RESERVED]
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our ordinary shares trade on the Nasdaq Global Select Market under the symbol “MGTX.” Holders of Record As of February 29, 2024, there were 52 holders of record.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our ordinary shares trade on the Nasdaq Global Select Market under the symbol “MGTX.” Holders of Record As of February 28, 2025, there were 51 holders of record.
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Recent Sales of Unregistered Securities On October 30, 2023, we entered into the Investment Agreement with Sanofi Foreign Participations, and solely for the limited purposes set forth therein, Sanofi, pursuant to which we, in a private placement, issued an aggregate of 4.0 million ordinary shares of the Company at a purchase price of $7.50 per share for gross proceeds of $30.0 million. ​ The ordinary shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended.

Item 7. Management's Discussion & Analysis

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

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Biggest changeUnder the Asset Purchase Agreement, Janssen paid the Company a non-refundable upfront cash payment of $65.0 million in December 2023 and a milestone payment of $50.0 million in the first quarter of 2024 in connection with the achievement of the initiation of the extension study for the Phase 3 LUMEOS clinical trial for the RPGR Product. 114 Table of Contents Additionally, pursuant to and subject to the terms and conditions set forth in the Asset Purchase Agreement, Janssen agreed to pay the Company additional future contingent consideration of up to an aggregate of $300.0 million.
Biggest changeAdditionally, pursuant to and subject to the terms and conditions set forth in the Asset Purchase Agreement, Johnson & Johnson Innovative Medicine agreed to pay the Company future contingent consideration of up to an aggregate of $350.0 million, as follows: (i) a milestone payment of $50.0 million in connection with the achievement of the initiation of the extension study for the Phase 3 LUMEOS clinical trial for the RPGR Product; (ii) $10.0 million upon completion of certain specified development services for the drug substance for the RPGR Product; (iii) $5.0 million upon completion of certain specified development services for the drug product for the RPGR Product; (iv) $175.0 million upon the first commercial sale of an RPGR Product in the United States; (v) $75.0 million upon the first commercial sale of an RPGR Product in at least one of the United Kingdom, France, Germany, Spain and Italy; (vi) $25.0 million upon completion of the transfer of certain manufacturing technology for drug substance and drug product from the Company to Johnson & Johnson Innovative Medicine; and (vii) $10.0 million upon regulatory approval of a Johnson & Johnson Innovative Medicine-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
Financing Activities Net cash provided by financing activities was $84.0 million for the year ended December 31, 2023, which consisted primarily of $92.0 million from the issuance of ordinary shares, which was offset by $6.4 million of issuance costs and $1.5 million of payments for withholdings of shares for income taxes.
Net cash provided by financing activities was $84.0 million for the year ended December 31, 2023, which consisted primarily of $92.0 million from the issuance of ordinary shares, which was offset by $6.4 million of issuance costs and $1.5 million of payments for withholdings of shares for income taxes.
We also incurred expenses during the year ended December 31, 2023 and expect to continue to incur expenses related to research activities in additional therapeutic areas to expand our pipeline, developing our potentially transformative gene regulation technology, hiring additional personnel as needed in manufacturing, research, clinical operations, quality and other functional areas, and associated cash and share-based compensation expense, as well as the further development of internal manufacturing capabilities and capacity and other associated costs including the management of our intellectual property portfolio.
We also incurred expenses during the year ended December 31, 2024 and expect to continue to incur expenses related to research activities in additional therapeutic areas to expand our pipeline, developing our potentially transformative gene regulation technology, hiring additional personnel as needed in manufacturing, research, clinical operations, quality and other functional areas, and associated cash and share-based compensation expense, as well as the further development of internal manufacturing capabilities and capacity and other associated costs including the management of our intellectual property portfolio.
Additionally, operating assets, consisting of accounts receivable-related party, prepaid expenses, tax incentive receivable, other current assets and other assets, decreased by $6.0 million and operating liabilities, consisting of accounts payable, accrued expenses, and deferred revenue-related party, decreased by $6.9 million.
Additionally, operating assets, consisting of accounts receivable – related party, prepaid expenses, tax incentive receivable, other current assets and other assets, net, decreased by $6.0 million and operating liabilities, consisting of accounts payable, accrued expenses, other current liabilities and deferred revenue – related party, decreased by $6.9 million.
The duration, costs and timing of clinical trials and development of our existing product candidates or any other product candidate we may develop will depend on a variety of factors, including: 119 Table of Contents ● the scope, rate of progress, expense and results of clinical trials of our existing product candidates, as well as of any future clinical trials of other product candidates and other research and development activities that we may conduct; ● uncertainties in clinical trial design and patient enrollment rates; ● the actual probability of success for our product candidates, including the safety and efficacy, early clinical data, competition, manufacturing capability and commercial viability; ● significant and changing government regulation and regulatory guidance; ● the timing and receipt of any marketing approvals; and ● the expense of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights.
The duration, costs and timing of clinical trials and development of our existing product candidates or any other product candidate we may develop will depend on a variety of factors, including: ● the scope, rate of progress, expense and results of clinical trials of our existing product candidates, as well as of any future clinical trials of other product candidates and other research and development activities that we may conduct; ● uncertainties in clinical trial design and patient enrollment rates; ● the actual probability of success for our product candidates, including the safety and efficacy, early clinical data, competition, manufacturing capability and commercial viability; ● significant and changing government regulation and regulatory guidance; ● the timing and receipt of any marketing approvals; and ● the expense of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights.
If we conclude that some or all aspects of the arrangement are within the scope of ASC 808 and do not represent a transaction with a customer, we recognize our allocation of the shared costs incurred with respect to the jointly conducted activities pursuant to ASC 730, Research and Development .
If we conclude that some or all aspects of the arrangement are within the scope of ASC 808 and do not represent a transaction with a customer, we recognize our allocation of the shared costs incurred with respect to the jointly conducted activities pursuant to ASC 730, Research and Development (“ASC 730”).
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, and include: ● employee-related expenses, including salaries, benefits and travel of our research and development personnel; ● expenses incurred in connection with third-party vendors that conduct clinical and preclinical studies and manufacture the drug product for the clinical trials and preclinical activities; ● acquisition and impairment of in process research and development; ● costs associated with clinical and preclinical activities including costs related to facilities, supplies, rent, insurance, certain legal fees, share-based compensation, and depreciation; and ● expenses incurred with the development and operation of our manufacturing facilities.
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, and include: ● employee-related expenses, including salaries, benefits and travel of our research and development personnel; 123 Table of Contents ● expenses incurred in connection with third-party vendors that conduct clinical and preclinical studies and manufacture the drug product for the clinical trials and preclinical activities; ● acquisition and impairment of in process research and development; ● costs associated with clinical and preclinical activities including costs related to facilities, supplies, rent, insurance, certain legal fees, share-based compensation, and depreciation; and ● expenses incurred with the development and operation of our manufacturing facilities.
Any future debt financing or preferred equity or other financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends and may require the issuance of warrants, which could potentially dilute your ownership interests.
Any future debt financing or preferred equity or other financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital 119 Table of Contents expenditures or declaring dividends and may require the issuance of warrants, which could potentially dilute your ownership interests.
Payments received from a collaboration partner to which 121 Table of Contents this policy applies may include upfront payments in respect of a license of intellectual property, development and commercialization-based milestones, and royalties. Revenue Recognition We evaluate the promised goods or services to determine which promises, or group of promises, represent performance obligations in our contracts with customers.
Payments received from a collaboration partner to which this policy applies may include upfront payments in respect of a license of intellectual property, development and commercialization-based milestones, and royalties. Revenue Recognition We evaluate the promised goods or services to determine which promises, or group of promises, represent performance obligations in our contracts with customers.
As a result of these incurred and expected expenses we will need additional capital to fund our operations, which we may obtain from additional equity or debt financings, collaborations, licensing arrangements, or other sources. 127 Table of Contents We do not currently have any approved products and have never generated any revenue from product sales.
As a result of these incurred and expected expenses we will need additional capital to fund our operations, which we may obtain from additional equity or debt financings, collaborations, licensing arrangements, or other sources. We do not currently have any approved products and have never generated any revenue from product sales.
This estimate does not include the $285.0 million in milestones we are eligible to receive under the Asset Purchase Agreement upon first commercial sale of an RPGR Product in the United States and in at least one of the United Kingdom, France, Germany, Spain and Italy, for completion of the transfer of certain manufacturing technology to Janssen and upon regulatory approval of a Janssen-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
This estimate does not include the $285.0 million in milestones we are eligible to receive under the Asset Purchase Agreement upon first commercial sale of an RPGR Product in the United States and in at least one of the United Kingdom, France, Germany, Spain and Italy, for completion of the transfer of certain manufacturing technology to Johnson & Johnson Innovative Medicine and upon regulatory approval of a Johnson & Johnson Innovative Medicine-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
We then consider any constraints on the variable 122 Table of Contents consideration and include in the transaction price variable consideration to the extent it is deemed probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
We then consider any constraints on the variable consideration and include in the transaction price variable consideration to the extent it is deemed probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
Off-Balance Sheet Arrangements We have not entered into any off-balance sheet arrangements under applicable SEC rules and do not have any holdings in variable interest entities. ​ ​ 130 Table of Contents
Off-Balance Sheet Arrangements We have not entered into any off-balance sheet arrangements under applicable SEC rules and do not have any holdings in variable interest entities. ​ ​ 135 Table of Contents
In addition, we expect to continue to incur expenses related to research activities in additional therapeutic areas to expand our pipeline and developing our potentially transformative gene regulation technology.
In addition, we expect to continue to incur expenses related to research activities in additional therapeutic areas to expand our pipeline and develop our potentially transformative gene regulation technology.
On December 20, 2023, we entered into an Asset Purchase Agreement with Janssen pursuant to which the Company sold and assigned to Janssen a License Agreement between the Company and UCLB relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the APA.
On December 20, 2023, we entered into an Asset Purchase Agreement with Johnson & Johnson Innovative Medicine pursuant to which the Company sold and assigned to Johnson & Johnson Innovative Medicine a License Agreement between the Company and UCLB relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the APA.
On December 20, 2023, we entered into an Asset Purchase Agreement with Janssen pursuant to which the Company sold and assigned to Janssen a License Agreement between the Company and UCLB relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
On December 20, 2023, we entered into an Asset Purchase Agreement with Johnson & Johnson Innovative Medicine pursuant to which the Company sold and assigned to Johnson & Johnson Innovative Medicine a License Agreement between the Company and UCLB relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
On December 20, 2023, we entered into an Asset Purchase Agreement with Janssen pursuant to which the Company sold and assigned to Janssen a License Agreement between the Company and UCLB relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
On December 20, 2023, we entered into an Asset Purchase Agreement with Johnson & Johnson Innovative Medicine pursuant to which the Company sold and assigned to Johnson & Johnson Innovative Medicine a License Agreement between the Company and UCLB relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets as described in the Asset Purchase Agreement.
To determine revenue recognition, we perform the following five steps: i. identify the contract(s) with a customer; ii. identify the performance obligations in the contract; iii. determine the transaction price; iv. allocate the transaction price to the performance obligations within the contract; and v. recognize revenue when (or as) the entity satisfies a performance obligation.
To determine revenue recognition, we perform the following five steps: i. identify the contract(s) with a customer; ii. identify the performance obligations in the contract; iii. determine the transaction price; 126 Table of Contents iv. allocate the transaction price to the performance obligations within the contract; and v. recognize revenue when (or as) the entity satisfies a performance obligation.
Developing certain assumptions (e.g., treatable patient population, expected market share, probability of success and product profitability, and discount rate based on weighted-average cost of capital) to estimate the SSP of a performance obligation requires significant judgment. We record amounts as accounts receivable when the right to consideration is deemed unconditional.
Developing certain assumptions (e.g., treatable patient population, expected market share, probability of success and product profitability, and discount rate based on weighted-average cost of capital) to estimate the SSP of a performance obligation requires significant judgment. We record amounts as contract assets when the right to consideration is deemed unconditional. Contract assets are reclassified as accounts receivable once billed.
This estimate does not include the $285.0 million in milestones we are eligible to receive under the Asset Purchase Agreement upon first commercial sale of an RPGR Product in the United States and in at least one of the United Kingdom, France, Germany, Spain and Italy, for completion of the transfer of certain manufacturing technology to Janssen and upon regulatory approval of a Janssen-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
This estimate does not include the $285.0 million in milestones we are eligible to receive under the Asset Purchase Agreement upon first commercial sale of an RPGR Product in the United States and in at least one of the United Kingdom, France, Germany, Spain and Italy, 133 Table of Contents for completion of the transfer of certain manufacturing technology to Johnson & Johnson Innovative Medicine and upon regulatory approval of a Johnson & Johnson Innovative Medicine-selected manufacturing facility in each of the United States and European Union for commercial manufacture of the RPGR Product.
We have incurred and expect to continue to incur increased expenses associated with being a public company, including costs of accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with Nasdaq and SEC requirements; director and officer insurance costs; and investor and public relations costs.
We have incurred and expect to continue to incur increased expenses associated with being a public company, including costs of accounting, audit, legal, regulatory and tax-related services associated with maintaining compliance with Nasdaq and SEC requirements; director and officer insurance costs; maintaining and protecting our intellectual property portfolio; and investor and public relations costs.
Gain on sale of nonfinancial assets The gain on sale of nonfinancial assets represents the value allocated to the nonfinancial assets sold and assigned to Janssen including the UCLB RPGR License Agreement relating to the research, development, manufacture 120 Table of Contents and exploitation of the RPGR Product, and other related assets pursuant to the Asset Purchase Agreement, net of carrying value. ​ Other comprehensive (loss) income Other comprehensive (loss) income includes the following: Foreign currency translation (loss) gain Expenses of subsidiaries have been translated into U.S. dollars at average exchange rates prevailing during the period.
Gain on Sale of Nonfinancial Assets The gain on sale of nonfinancial assets represents the value allocated to the nonfinancial assets sold and assigned to Johnson & Johnson Innovative Medicine including the UCLB RPGR License Agreement relating to the research, development, manufacture and exploitation of the RPGR Product, and other related assets pursuant to the Asset Purchase Agreement, net of carrying value. ​ Other Comprehensive Loss Other comprehensive loss includes the following: Foreign Currency Translation Loss Expenses of subsidiaries have been translated into U.S. dollars at average exchange rates prevailing during the period.
We base our estimates on historical experience, known trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgements about the carrying value of assets and liabilities that are not readily apparent from our sources. Actual results may differ from these estimates under different assumptions.
We base our estimates on historical experience, known trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgements about the carrying value of assets and liabilities that are not readily apparent from our sources.
We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. Cash Flows We had $130.6 million and $115.5 million of cash, cash equivalents, and restricted cash as of December 31, 2023 and 2022, respectively.
We have based these estimates on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. Cash Flows We had $105.7 million and $130.6 million of cash, cash equivalents, and restricted cash as of December 31, 2024 and 2023, respectively.
Amounts expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue – related party, current. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue – related party.
Amounts expected to be recognized as revenue within the 12 months following the balance 127 Table of Contents sheet date are classified as deferred revenue – related party, current. Amounts not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as deferred revenue – related party.
Consequently, expected volatility is based on an analysis of our Company and guideline companies in accordance with ASC 718. The expected dividend yield is zero as we have never paid dividends and do not currently anticipate paying any in the foreseeable future. Risk-free interest rates are based on quoted U.S.
Expected volatility is based on an analysis of our Company and guideline companies in accordance with ASC 718. The expected dividend yield is zero as we have never paid dividends and do not currently anticipate paying any in the foreseeable future. Risk-free interest rates are based on quoted U.S. Treasury rates for securities with maturities approximating the option’s expected term.
Pursuant to the First Consent and Amendment, we may request in our sole discretion, and Perceptive has agreed to subscribe to purchase upon such request, the issuance of the Tranche 2 Notes in an additional amount of $25.0 million at any time before August 2, 2024.
Pursuant to the First Consent and Amendment, we were able to request, in our sole discretion, and Perceptive agreed to subscribe to purchase upon such request, the issuance of the Tranche 2 Notes in an additional amount of $25.0 million at any time before August 2, 2024 subject to the terms of the Notes Purchase Agreement.
The net loss included net non-cash gains of $20.4 million, which consisted of $54.2 million of a gain on sale of nonfinancial assets, $27.7 million of share-based compensation, $13.7 million of depreciation and amortization, $9.3 million of a foreign currency gain, $1.1 million of amortization of the debt discount, $1.1 million impairment related to acquired in-process research and development and right-of-use assets, $0.5 million of a fair value upward adjustment, $0.2 million of net change in right-of-use assets and liabilities and $0.2 million of amortization of interest on asset retirement obligations.
The net loss included net non-cash income and expense of $20.4 million, which consisted primarily of $27.7 million of share-based compensation, $13.7 million of depreciation and amortization, $1.3 million of non-cash interest and $1.1 million impairment related to acquired in-process research and development, which was partially offset by $54.2 million of a gain on sale of nonfinancial assets, $9.3 million of a foreign currency gain, $0.5 million of a fair value upward adjustment and $0.2 million of net change in right-of-use assets and liabilities.
During the year ended December 31, 2022, our cash used in operating activities of $73.1 million was primarily due to our net loss of $129.6 million as we incurred expenses associated with research activities on our clinical programs, manufacturing of our clinical trial materials, preclinical research programs and general and administrative expenses.
During the year ended December 31, 2023, our cash used in operating activities of $105.4 million was primarily due to our net loss of $84.0 million as we incurred expenses associated with research activities on our clinical programs, manufacturing of our clinical trial materials, preclinical research programs and general and administrative expenses.
Treasury rates for securities with maturities approximating the option’s expected term. Restricted Share Units The Company grants restricted share units (“RSUs”) to employees, non-employee members of our board of directors and non-employee consultants as compensation for services performed. Awards of RSUs are accounted for in accordance with ASC 718, Compensation - Stock Compensation, or ASC 718 .
Restricted Share Units The Company grants restricted share units (“RSUs”) to employees, non-employee members of our board of directors and non-employee consultants as compensation for services performed. Awards of RSUs are accounted for in accordance with ASC 718 .
Adequate additional financing may not be available to us on acceptable terms, or at all. Our failure to raise capital as and when needed would have a negative effect on our financial condition and our ability to pursue our business strategy.
Furthermore, we expect to continue incurring costs associated with being a public company. Adequate additional financing may not be available to us on acceptable terms, or at all. Our failure to raise capital as and when needed would have a negative effect on our financial condition and our ability to pursue our business strategy.
We have historically financed our operations primarily through cash on hand and proceeds from the sale of our ordinary shares, series A ordinary shares and convertible preferred C shares.
We have historically financed our operations primarily through cash on hand and proceeds from the sale of our ordinary shares, series A ordinary shares and convertible preferred C shares and upfront and milestone payments from 132 Table of Contents collaboration agreements.
We expect to continue incurring increasing costs associated with our clinical activities for AAV-hAQP1 for the treatment of radiation-induced xerostomia and xerostomia associated with Sjogren’s syndrome, as well as 113 Table of Contents for AAV-GAD for the treatment of Parkinson’s disease.
We expect to continue incurring increasing costs associated with our clinical activities for AAV-hAQP1 for the treatment of radiation-induced xerostomia and xerostomia associated with Sjogren’s syndrome, AAV-GAD for the treatment of Parkinson’s disease, as well as costs associated with the delivery of services under the Asset Purchase and related agreements.
The following table summarizes our sources and uses of cash for the period presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, ​ ​ 2023 2022 ​ ​ (in thousands) ​ Net cash used in operating activities $ (105,365) $ (73,098) Net cash provided by (used in) investing activities ​ 34,034 ​ (44,963) ​ Net cash provided by financing activities ​ 84,023 ​ 95,200 ​ Net increase (decrease) in cash, cash equivalents and restricted cash ​ $ 12,692 ​ $ (22,861) ​ ​ Operating Activities During the year ended December 31, 2023, our cash used in operating activities of $105.4 million was primarily due to our net loss of $84.0 million as we incurred expenses associated with research activities on our clinical programs, manufacturing of our clinical trial materials, preclinical research programs and general and administrative expenses.
The following table summarizes our sources and uses of cash for the period presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, ​ ​ 2024 2023 ​ ​ (in thousands) ​ Net cash used in operating activities $ (104,495) $ (105,365) Net cash provided by investing activities ​ 23,479 ​ 34,034 ​ Net cash provided by financing activities ​ 54,534 ​ 84,023 ​ Net (decrease) increase in cash, cash equivalents and restricted cash ​ $ (26,482) ​ $ 12,692 ​ ​ Operating Activities During the year ended December 31, 2024, our cash used in operating activities of $104.5 million was primarily due to our net loss of $147.8 million as we incurred expenses associated with research activities on our clinical programs, manufacturing of our clinical trial materials, preclinical research programs and general and administrative expenses.
While our significant accounting policies are described in more detail in the notes to our financial statements appearing in this Form 10-K, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our financial statements.
Actual results may differ from these estimates under different assumptions. 125 Table of Contents While our significant accounting policies are described in more detail in the notes to our financial statements appearing in this Form 10-K, we believe that the following accounting policies are those most critical to the judgments and estimates used in the preparation of our financial statements.
Through December 31, 2023, we received gross proceeds of approximately $562.9 million from sales of our ordinary shares, Series A ordinary shares and convertible preferred C shares, gross proceeds of approximately $75.0 million from issuance of debt, $130.0 million from the Collaboration Agreement with Janssen, and $65.0 million from the Asset Purchase Agreement with Janssen.
Through December 31, 2024, we received gross proceeds of approximately $622.3 million from sales of our ordinary shares, Series A ordinary shares and convertible preferred C shares, gross proceeds of approximately $75.0 million from issuance of debt, $130.0 million from the Collaboration Agreement with Johnson & Johnson Innovative Medicine, and $125.0 million from the Asset Purchase Agreement with Johnson & Johnson Innovative Medicine.
For example, if the FDA or another U.S. or foreign regulatory authority were to require us to conduct clinical trials beyond those that we anticipate will be required for the completion of clinical development of a product candidate, or if we experience significant delays in our clinical trials due to patient enrollment or other reasons, we would be required to expend significant additional financial resources and time on the completion of clinical development.
For example, if the FDA or another U.S. or foreign regulatory authority were to require us to conduct clinical trials beyond those that we anticipate will be required for the completion of clinical development of a product candidate, or if we experience significant delays in our clinical trials due to patient enrollment or other reasons, we would be required to expend significant additional financial resources and time on the completion of clinical development. 124 Table of Contents Other Non-Operating Income (Expense) Other non-operating income (expense) includes the following: Foreign Currency (Loss) Gain Our consolidated financial statements are presented in U.S. dollars, which is our reporting currency.
ASC 808 does not address recognition or measurement matters related to collaborative arrangements. Payments between participants pursuant to a collaborative arrangement that are within the scope of other authoritative accounting literature on income statement classification are accounted for using the relevant provisions of that literature.
Payments between participants pursuant to a collaborative arrangement that are within the scope of other authoritative accounting literature on income statement classification are accounted for using the relevant provisions of that literature.
We have an internally developed manufacturing platform process, internal plasmid production for GMP, two GMP viral vector production facilities as well as an in-house Quality Control hub for stability and release, all fit for IND through commercial supply.
We have two GMP viral vector production facilities, internal plasmid production for GMP, as well as an in-house Quality Control hub for stability and release, all fit for IND through 116 Table of Contents commercial supply. In addition, we have developed a proprietary manufacturing platform with leading yield and quality aspects and commercial readiness.
ASC 718 requires all share-based payments, including grants of RSUs, to be recognized in the consolidated statement of operations and comprehensive loss based on their grant date fair values.
ASC 718 requires all share-based payments, including grants of share options, to be recognized in the statement of operations and comprehensive loss based on their grant date fair values. The grant date fair value of share options is estimated using the Black-Scholes option valuation model.
We are focusing the riboswitch platform on delivery of metabolic peptides including GLP-1, GIP, glucagon and PYY using oral small molecules, as well as cell therapy for oncology and autoimmune diseases.
We are focusing the riboswitch platform on in vivo delivery of biologic therapeutics such as the metabolic peptides GLP-1, GIP, glucagon, amylin, PYY and leptin via oral small molecules, as well as cell therapy for oncology and autoimmune diseases, and long-term intractable pain.
Although initially focusing on the eye, central nervous system, and salivary gland, we have developed the technology to apply genetic medicine to more common diseases, increasing efficacy, addressing novel targets, and expanding access in some of the largest disease areas where the unmet need remains great.
We have developed unique comprehensive technology capabilities to apply genetic medicine to more common diseases, increasing efficacy, addressing novel targets, and expanding access in some of the largest disease areas where the unmet need remains high.
We will require additional capital in the future, which we may raise through equity offerings, debt financings, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements or other sources to enable us to complete the development and potential commercialization of our product candidates. Furthermore, we expect to continue incurring costs associated with being a public company.
The closing of the Private Placement occurred on August 29, 2024. We will require additional capital in the future, which we may raise through equity offerings, debt financings, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements or other sources to enable us to complete the development and potential commercialization of our product candidates.
Outstanding amounts under the Notes Purchase Agreement bear interest at a fluctuating rate per annum equal to 10.00% plus the secured overnight financing rate administered by the Federal Reserve Bank of New York for a one-month tenor, subject to a 1.00% floor.
Outstanding amounts under the Notes Purchase Agreement bear interest at a fluctuating rate per annum equal to 10.00% plus the secured overnight financing rate administered by the Federal Reserve Bank of New York for a one-month tenor, subject to a 1.00% floor. ​ Our obligations under the Notes Purchase Agreement are secured by our London, UK and Shannon, Ireland manufacturing facilities, $3.0 million of our cash and the bank accounts of the Subsidiary Guarantors, and the issued and outstanding equity interests of the Subsidiary Guarantors.
Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be. 123 Table of Contents Share-Based Compensation Options We grant share options to employees, non-employee members of our board of directors and non-employee consultants as compensation for services performed.
Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected in the financial statements as prepaid or accrued research and development expense, as the case may be.
In connection with entering into the Asset Purchase Agreement, we entered into a Termination Agreement with Janssen terminating the Collaboration Agreement. The Company and Janssen also entered into a Supply Agreement on December 20, 2023 pursuant to which the Company agreed to manufacture and supply the RPGR Product for Janssen.
The Company and Johnson & Johnson Innovative Medicine also entered into a Supply Agreement on December 20, 2023 pursuant to which the Company agreed to manufacture and supply the RPGR Product for Johnson & Johnson Innovative Medicine. In December 2023, we received a non-refundable upfront payment of $65.0 million in connection with the Asset Purchase Agreement.
Other research and development expenses represent costs that are not allocated to a specific clinical or preclinical program, such as payroll and payroll related costs, share-based compensation, travel, rent and facilities costs, depreciation and other non-program specific expenses.
Other research and development expenses represent costs that are not allocated to a specific clinical or preclinical program, such as payroll and payroll related costs, share-based compensation, travel, rent and facilities costs, depreciation and other non-program specific expenses. 131 Table of Contents Research and development expenses for the year ended December 31, 2024 were $119.5 million, compared to $103.8 million for the year ended December 31, 2023.
Net cash provided by financing activities was $95.2 million for the year ended December 31, 2022, which consisted primarily of $75.0 million from issuance of the Tranche 1 Notes, $25.0 million from the issuance of ordinary shares and $0.2 million in exercise of share options, which was offset by $2.8 million of payments for withholdings of shares for income taxes, and issuance costs of $2.2 million.
Financing Activities Net cash provided by financing activities was $54.5 million for the year ended December 31, 2024, which consisted primarily of $59.4 million from the issuance of ordinary shares, which was offset by $2.5 million of issuance costs and $2.3 million of payments for withholdings of shares for income taxes.
Additionally, operating assets, consisting of accounts receivable-related party, prepaid expenses, tax incentive receivable, other current assets and other assets, decreased by $5.2 million and operating liabilities, consisting of accounts payable, accrued expenses, and deferred revenue-related party, decreased by $4.4 million. 129 Table of Contents Investing Activities Net cash provided by investing activities for the year ended December 31, 2023 of $34.0 million consisted of $54.2 million from proceeds from the sale of nonfinancial assets and $20.2 million of purchases of property and equipment for our manufacturing, laboratory and process development facilities.
Investing Activities Net cash provided by investing activities for the year ended December 31, 2024 of $23.5 million consisted of $28.4 million from proceeds from the sale of nonfinancial assets offset by $4.9 million of purchases of property and equipment for our manufacturing, laboratory and process development facilities. 134 Table of Contents Net cash provided by investing activities for the year ended December 31, 2023 of $34.0 million consisted of $54.2 million from proceeds from the sale of nonfinancial assets offset by $20.2 million of purchases of property and equipment for our manufacturing, laboratory and process development facilities.
We have ongoing clinical development programs and a broad pipeline of preclinical programs. Since inception, we have incurred significant operating losses. Our net losses for the years ended December 31, 2023 and 2022 were $84.0 million and $129.6 million, respectively. As of December 31, 2023, we had an accumulated deficit of $554.2 million.
We are a clinical stage company and have not generated any product revenues to date. We have ongoing clinical development programs and a broad pipeline of preclinical programs. Since inception, we have incurred significant operating losses. Our net losses for the years ended December 31, 2024 and 2023 were $147.8 million and $84.0 million, respectively.
We expect to incur significant expenses and operating losses for the foreseeable future as we advance the preclinical and clinical development of our product candidates.
Additionally, there are no assurances that we will be successful in obtaining an adequate level of financing for the development and commercialization of our product candidates. We expect to incur significant expenses and operating losses for the foreseeable future as we advance the preclinical and clinical development of our product candidates.
Twelve months of interest was recorded during the year ended December 31, 2023 compared to five months of interest recorded during the year ended December 31, 2022. Gain on sale of nonfinancial assets The gain on sale of nonfinancial assets was $54.2 million for the year ended December 31, 2023 compared to $0 for the year ended December 31, 2022.
Interest Expense Interest expense was $13.3 million for each of the years ended December 31, 2024 and 2023. Gain on Sale of Nonfinancial Assets The gain on sale of nonfinancial assets was $28.4 million for the year ended December 31, 2024 compared to $54.2 million for the year ended December 31, 2023.
We have core capabilities in viral vector design and optimization and a potentially transformative riboswitch gene regulation platform technology that allows for the precise, dose-responsive control of gene expression by oral small molecules.
Our core capabilities in viral vector and capsid optimization allow increased potency, decreased dose and significantly reduced cost of goods for our genetic medicines. We have developed a potentially transformative gene regulation platform using bespoke synthetic riboswitch technology invented in-house that allows for the precise, dose-responsive control of any transgene under the control of oral small molecules.
The financial position and results of operations of our subsidiaries MeiraGTx UK II Limited, MeiraGTx Ireland DAC, MeiraGTx Netherlands B.V., MeiraGTx B.V. and MeiraGTx Belgium are measured using the foreign subsidiaries’ local currency as the functional currency.
The financial position and results of operations of our subsidiaries are measured using the foreign subsidiaries’ local currency as the functional currency, either the pound sterling or the euro.
In connection with entering into the Asset Purchase Agreement, we entered into a Termination Agreement with Janssen terminating the Collaboration Agreement. The Company and Janssen also entered into a Supply Agreement on December 20, 2023 pursuant to which we agreed to manufacture and supply the RPGR Product for Janssen.
The Company and Johnson & Johnson Innovative Medicine also entered into a Supply Agreement on December 20, 2023 pursuant to which we agreed to manufacture and supply the RPGR Product for Johnson & Johnson Innovative Medicine. Under the Asset Purchase Agreement, Johnson & Johnson Innovative Medicine paid the Company a non-refundable upfront cash payment of $65.0 million in December 2023.
We do not expect to generate revenue from sales of products for several years, if at all. Under the Collaboration Agreement, we received an upfront payment in the amount of $100.0 million in March 2019 and a milestone payment in the amount of $30.0 million in December 2021.
Under the Collaboration Agreement, we received an upfront payment in the amount of $100.0 million in March 2019 and a milestone payment in the amount of $30.0 million in December 2021. Additionally, pursuant to the Collaboration Agreement, we received research and development funding for certain research, manufacturing and clinical development costs.
In connection with entering into the Asset Purchase Agreement, we entered into a Termination Agreement with Janssen terminating the Collaboration Agreement. The Company and Janssen also entered into a Supply Agreement on December 20, 2023 pursuant to which the Company agreed to manufacture and supply the RPGR Product for Janssen.
The Company and Johnson & Johnson Innovative Medicine also entered into a Supply Agreement on December 20, 2023 pursuant to which the Company agreed to manufacture and supply the RPGR Product for Johnson & Johnson Innovative Medicine. During the year ended December 31, 2024, we received $60.0 million in milestone payments under the Asset Purchase Agreement.
For convenience of presentation some of the numbers have been rounded in the text below. 112 Table of Contents Overview We are a vertically integrated, clinical-stage gene therapy company with a broad pipeline of late stage clinical programs supported by end-to-end manufacturing capabilities.
For convenience of presentation some of the numbers have been rounded in the text below. Overview We are a vertically integrated, clinical-stage genetic medicines company with a broad pipeline of late-stage clinical programs, including Parkinson’s disease, radiation-induced xerostomia and AIPL1-associated retinal dystrophy.
Interest income Interest income was $2.3 million for the year ended December 31, 2023 compared to $0.8 million for the year ended December 31, 2022. The increase was due to higher interest rates and cash balances during 2023.
Foreign currency gains and losses subsequent to the restructuring are recorded as a part of accumulated other comprehensive income. Interest Income Interest income was $4.1 million for the year ended December 31, 2024 compared to $2.3 million for the year ended December 31, 2023. The increase was due to higher interest rates and cash balances during 2024.
In December 2023, we received a non-refundable upfront payment of $65.0 million in connection with the Asset Purchase Agreement. Our total operating expenses were $151.1 million and $132.3 million for the years ended December 31, 2023 and 2022, respectively.
During the year ended December 31, 2024, we received $60.0 million in milestone payments under the Asset Purchase Agreement. 117 Table of Contents Our total operating expenses were $197.5 million and $151.1 million for the years ended December 31, 2024 and 2023, respectively.
Share-based compensation are accounted for in accordance with ASC 718, Compensation—Stock Compensation , or ASC 718. ASC 718 requires all share-based payments, including grants of share options, to be recognized in the statement of operations and comprehensive loss based on their grant date fair values.
ASC 718 requires all share-based payments, including grants of RSUs, to be recognized in 129 Table of Contents the consolidated statement of operations and comprehensive loss based on their grant date fair values. The grant date fair value of RSUs is determined using the closing market price of the Company’s ordinary shares on the date of grant.
General and administrative expenses General and administrative expenses were $47.3 million for the year ended December 31, 2023, compared to $46.6 million for the year ended December 31, 2022.
There was no cost of service revenue for the year ended December 31, 2023. 130 Table of Contents General and Administrative Expenses General and administrative expenses were $54.2 million for the year ended December 31, 2024, compared to $47.3 million for the year ended December 31, 2023.
We did not generate positive cash flows from operations during the year and there are no assurances that we will generate positive cash flows in the future. Additionally, there are no assurances that we will be successful in obtaining an adequate level of financing for the development and commercialization of our product candidates.
For the year ended December 31, 2024, we used $104.5 million in cash flows from operations. We did not generate positive cash flows from operations during the year and there are no assurances that we will generate positive cash flows in the future.
If we are an active participant and exposed to significant risks and rewards with respect to the arrangement, we account for the arrangement as a collaboration under ASC 808. To date, we have entered into two separate collaboration agreements, both of which are with Janssen, which were determined to be within the scope of ASC 808.
If we are an active participant and exposed to significant risks and rewards with respect to the arrangement, we account for the arrangement as a collaboration under ASC 808. ASC 808 does not address recognition or measurement matters related to collaborative arrangements.
Based on our cash, cash equivalents and accounts receivable – related party at December 31, 2023 and the near-term milestone payments we have received and expect to receive under the Asset Purchase Agreement, we estimate that such funds will be sufficient to enable us to fund our operating expenses and capital expenditure requirements into the first quarter of 2026.
Based on our cash, cash equivalents, accounts receivable – related party and tax incentive receivable at December 31, 2024, together with the proceeds from the anticipated closing of the strategic collaboration with Hologen Ltd, we estimate that such funds will be sufficient to enable us to fund our operating expenses and capital expenditure requirements into 2027 and to repay our debt obligation of $75.0 million to Perceptive (due in August 2026).
The net loss included non-cash charges of $46.9 million, which consisted of $28.6 million of share-based compensation, $9.5 million of a foreign currency loss, $8.7 million of depreciation and amortization, $0.4 million of a fair value downward adjustment, $0.2 million of negative net change in right-of-use assets and liabilities, $0.2 million of amortization of interest on asset retirement obligations and $0.4 million of amortization of the debt discount.
The net loss included net non-cash income and expense of $13.6 million, which consisted primarily of $25.2 million of share-based compensation, $12.8 million of depreciation and amortization, $2.9 million of a foreign currency loss and $1.3 million of non-cash interest, which was partially offset by $28.4 million of a gain on sale of nonfinancial assets and $0.2 million of a gain on termination of lease liabilities.
These increases were partially offset by a decrease of $4.2 million in other general and administrative costs, $1.3 million in insurance, $0.3 million in consulting fees and $0.3 million in depreciation. 125 Table of Contents Research and development expenses Research and development expenses for the years ended December 31, 2023 and 2022 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For The Years Ended December 31, ​ ​ ​ ​ 2023 2022 ​ Change Clinical Programs ​ ​ ​ ​ ​ ​ Botaretigene sparoparvovec ​ $ 55,518 ​ $ 36,918 ​ $ 18,600 AAV-hAQP1 ​ 15,772 ​ 9,068 ​ 6,704 AAV-CNGB3 / AAV-CNGA3 ​ ​ 2,184 ​ ​ 5,743 ​ ​ (3,559) AAV-GAD ​ ​ 7,598 ​ ​ 10,148 ​ ​ (2,550) AAV-RPE65 ​ ​ — ​ ​ 3,751 ​ ​ (3,751) Manufacturing ​ 50,221 ​ 36,258 ​ 13,963 Preclinical Programs ​ ​ ​ ​ ​ ​ ​ ​ ​ Gene regulation ​ ​ 8,324 ​ ​ 12,462 ​ ​ (4,138) Neurodegenerative diseases ​ ​ 2,242 ​ ​ 3,546 ​ ​ (1,304) Preclinical ocular diseases ​ ​ 2,849 ​ ​ 13,999 ​ ​ (11,150) Other research and development expenses ​ ​ 29,506 ​ ​ 26,389 ​ ​ 3,117 Gross research and development expenses ​ ​ 174,214 ​ ​ 158,282 ​ ​ 15,932 Collaboration Agreement reimbursement ​ ​ (70,429) ​ ​ (72,557) ​ ​ 2,128 Research and development expenses ​ $ 103,785 ​ $ 85,725 ​ $ 18,060 ​ ​ Clinical program expenses represent the direct costs for each clinical trial plus the cost of the clinical trial material charged from the manufacturing costs.
Research and Development Expenses Research and development expenses for the years ended December 31, 2024 and 2023 were as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, ​ ​ ​ ​ 2024 2023 ​ Change Clinical Programs ​ ​ ​ ​ ​ ​ Botaretigene sparoparvovec ​ $ 1,250 ​ $ 55,518 ​ $ (54,268) AAV-hAQP1 ​ 17,307 ​ 15,772 ​ 1,535 AAV-CNGB3 / AAV-CNGA3 ​ ​ (969) ​ ​ 2,184 ​ ​ (3,153) AAV-GAD ​ ​ 6,411 ​ ​ 7,598 ​ ​ (1,187) Other ocular diseases ​ ​ 1,763 ​ ​ — ​ ​ 1,763 Manufacturing ​ 53,445 ​ 50,221 ​ 3,224 Preclinical Programs ​ ​ ​ ​ ​ ​ ​ ​ ​ Gene regulation ​ ​ 10,509 ​ ​ 8,324 ​ ​ 2,185 Neurodegenerative diseases ​ ​ 1,608 ​ ​ 2,242 ​ ​ (634) Preclinical ocular diseases ​ ​ 2,474 ​ ​ 2,849 ​ ​ (375) Other research and development expenses ​ ​ 25,686 ​ ​ 29,506 ​ ​ (3,820) Gross research and development expenses ​ ​ 119,484 ​ ​ 174,214 ​ ​ (54,730) Johnson & Johnson Innovative Medicine reimbursement ​ ​ — ​ ​ (70,429) ​ ​ 70,429 Research and development expenses ​ $ 119,484 ​ $ 103,785 ​ $ 15,699 ​ ​ Clinical program expenses represent the direct costs for each clinical trial plus the cost of the clinical trial material charged from the manufacturing costs.
A year to date true-up of the standard batch cost has been reflected in the fourth quarter. Preclinical program expenses represent the direct costs for each group of preclinical programs.
Preclinical program expenses represent the direct costs for each group of preclinical programs.
The grant date fair value of RSUs is determined using the closing market price of the Company’s ordinary shares on the date of grant. 124 Table of Contents Results of Operations Comparison of the Years Ended December 31, 2023 and 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2023 2022 Change ​ ​ (in thousands) License revenue - related party ​ $ 14,017 ​ $ 15,920 ​ $ (1,903) Operating expenses: ​ ​ ​ ​ ​ ​ General and administrative ​ ​ 47,293 ​ ​ 46,550 ​ ​ 743 Research and development ​ 103,785 ​ 85,725 ​ 18,060 Total operating expenses ​ 151,078 ​ 132,275 ​ 18,803 Loss from operations ​ (137,061) ​ (116,355) ​ (20,706) Other non-operating income (expense) ​ ​ ​ ​ ​ ​ Foreign currency gain (loss) ​ 9,300 ​ (9,452) ​ 18,752 Interest income ​ 2,272 ​ 777 ​ 1,495 Interest expense ​ (13,245) ​ (4,946) ​ (8,299) Gain on sale of nonfinancial assets ​ ​ 54,208 ​ ​ — ​ ​ 54,208 Fair value adjustments ​ ​ 499 ​ 361 ​ 138 Net loss ​ $ (84,027) ​ $ (129,615) ​ $ 45,588 Other comprehensive (loss) income: ​ ​ ​ ​ ​ ​ ​ ​ ​ Foreign currency translation (loss) gain ​ ​ (7,482) ​ ​ 8,718 ​ ​ (16,200) Comprehensive loss ​ $ (91,509) ​ $ (120,897) ​ $ 29,388 ​ License revenue – related party License revenue was $14.0 million for the year ended December 31, 2023, compared to $15.9 million for the year ended December 31, 2022.
Results of Operations Comparison of the Years Ended December 31, 2024 and 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2024 2023 Change ​ ​ (in thousands) Revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ Service revenue - related party ​ $ 33,279 ​ $ — ​ $ 33,279 License revenue - related party ​ ​ — ​ ​ 14,017 ​ ​ (14,017) Total revenue ​ ​ 33,279 ​ ​ 14,017 ​ ​ 19,262 Operating expenses: ​ ​ ​ ​ ​ ​ Cost of service revenue - related party ​ ​ 23,791 ​ ​ — ​ ​ 23,791 General and administrative ​ ​ 54,216 ​ ​ 47,293 ​ ​ 6,923 Research and development ​ 119,484 ​ 103,785 ​ 15,699 Total operating expenses ​ 197,491 ​ 151,078 ​ 46,413 Loss from operations ​ (164,212) ​ (137,061) ​ (27,151) Other non-operating income (expense) ​ ​ ​ ​ ​ ​ Foreign currency (loss) gain ​ (2,886) ​ 9,300 ​ (12,186) Interest income ​ 4,145 ​ 2,272 ​ 1,873 Interest expense ​ (13,272) ​ (13,245) ​ (27) Gain on sale of nonfinancial assets ​ ​ 28,434 ​ ​ 54,208 ​ ​ (25,774) Fair value adjustments ​ ​ — ​ 499 ​ (499) Net loss ​ $ (147,791) ​ $ (84,027) ​ $ (63,764) Other comprehensive loss: ​ ​ ​ ​ ​ ​ ​ ​ ​ Foreign currency translation loss ​ ​ (2,284) ​ ​ (7,482) ​ ​ 5,198 Comprehensive loss ​ $ (150,075) ​ $ (91,509) ​ $ (58,566) ​ Service Revenue – Related Party Service revenue was $33.3 million for the year ended December 31, 2024, due to progress of PPQ services under the Asset Purchase Agreement and related agreements.
As of December 31, 2023, we had cash, cash equivalents and restricted cash of $130.6 million, as well as $10.1 million we expect to receive from Janssen in the first quarter of 2024 in connection with the Collaboration Agreement. We are a clinical stage company and have not generated any product revenues to date.
As of December 31, 2024, we had cash, cash equivalents and restricted cash of $105.7 million, as well as $0.7 million we expect to receive from Johnson & Johnson Innovative Medicine in the first quarter of 2025 in connection with the PPQ and transition services we provided to Johnson & Johnson Innovative Medicine.
The increase of $0.7 million was primarily due to an increase of $4.1 million in legal and accounting fees, $2.2 million in payroll and payroll-related costs, $0.4 million in share-based compensation and $0.1 million in rent and facilities costs.
The increase of $6.9 million was primarily due to an increase of $2.1 million in professional fees, and the remaining $4.8 million was related to other general and administrative costs, none of which were individually significant.
Based on our current cash, cash equivalents and accounts receivable – related party at December 31, 2023 and the near-term milestone payments we have received and expect to receive under the Asset Purchase Agreement, we 128 Table of Contents estimate that we will be able to fund our operating expenses and capital expenditure requirements into the first quarter of 2026.
Based on our current cash, cash equivalents, accounts receivable – related party, and tax incentive receivable at December 31, 2024, together with the proceeds from the anticipated closing of the strategic collaboration with Hologen Ltd, we estimate that we will be able to fund our operating expenses and capital expenditure requirements into 2027 and to repay our debt obligation of $75.0 million to Perceptive (due in August 2026).
If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations. 115 Table of Contents Highlights and Recent Developments Recent Development Highlights and Anticipated Milestones ​ AAV-hAQP1 for the Treatment of Grade 2/3 Radiation-Induced Xerostomia: Grade 2/3 radiation-induced xerostomia (RIX) is a severely debilitating consequence of radiation treatment for head and neck cancer that affects approximately 30-40% of all patients treated with radiation for head and neck cancer.
If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to continue our operations at planned levels and be forced to reduce or terminate our operations.
The increase of $18.1 million was primarily due to an increase of $15.4 million in clinical trial expenses primarily related to the bota-vec and AAV-hAQP1 programs, $14.0 million of manufacturing costs, $3.1 million of other research and development expenses and a decrease of $2.1 million in research funding provided under the Collaboration Agreement with Janssen.
The increase of $15.7 million was primarily due to an increase in manufacturing costs of $3.2 million, preclinical expenses of $1.2 million and a reduction in reimbursements from Johnson & Johnson Innovative Medicine of $70.4 million as the reimbursement for the year ended December 31, 2023 was in connection with research funding provided under the Collaboration Agreement, which was terminated on December 20, 2023.
The change in the amount of $16.2 million was primarily due to a strengthening of the U.S. dollar against the pound sterling and euro during the year ended December 31, 2023. Liquidity and Capital Resources Since our inception, we have incurred significant operating losses. For the year ended December 31, 2023, we used $105.4 million in cash flows from operations.
This decrease was a result of a lower value of transaction consideration recognized in connection with the Asset Purchase Agreement during the year ended December 31, 2024 compared to the year ended December 31, 2023. Liquidity and Capital Resources Since our inception, we have incurred significant operating losses.
The change of $18.8 million was primarily due to the strengthening of the U.S. dollar against the pound sterling and euro during the year ended December 31, 2023 as it relates to the valuation of our intercompany payables and receivables.
Foreign Currency (Loss) Gain Foreign currency loss was $2.9 million for the year ended December 31, 2024 compared to a gain of $9.3 million for the year ended December 31, 2023. The change of $12.2 million was primarily due to the restructuring and payment of certain intercompany receivables and payables during the year ended December 31, 2023.
Research and Development Research and development costs are charged to expense as incurred.
Amounts allocated to any material right are recognized as revenue when or as the related future goods or services are transferred or when the option expires. Research and Development Research and development costs are charged to expense as incurred.
(“JJDC”), the investment arm of Johnson & Johnson, pursuant to which we, in a private placement, agreed to issue and sell to JJDC an aggregate of 3,742,514 ordinary shares at a purchase price of $6.68 per share for gross proceeds of approximately $25.0 million.
We received gross proceeds from the offering of $50.0 million and incurred underwriting discounts and commissions and estimated offering expenses of approximately $1.9 million. ​ On August 12, 2024, the Company agreed to sell shares to an accredited investor (the “Investor”) through a private placement rather than through the public offering and as a result, on August 23, 2024, we entered into a securities purchase agreement with the Investor, pursuant to which we, in a private placement, agreed to issue and sell to the Investor 250,000 ordinary shares at a purchase price of $4.00 per share, for gross proceeds of $1.0 million (the “Private Placement”).
Removed
Additionally, pursuant to the Collaboration Agreement, we received research and development funding for certain research, manufacturing and clinical development costs.
Added
Our clinical programs use targeted local delivery of small doses of genetic medicines to treat both inherited and more common conditions with severe unmet need. The successful development of the clinical pipeline is supported by our internal end-to-end manufacturing capabilities.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−0 removed4 unchanged
Biggest changeTo the extent that our international activities recorded in local currencies increase in the future, our exposure to fluctuations in currency exchange rates will correspondingly increase.
Biggest changeTo the extent that our international activities recorded in local currencies increase in the future, our exposure to fluctuations in currency exchange rates will correspondingly increase. As of December 31, 2024, we did not hold any foreign currency forward contracts.
Assuming no change in the outstanding borrowings under the Notes Purchase Agreement, we estimate that a hypothetical 1% increase in the SOFR would increase our annual interest expense by approximately $0.8 million for the year ended December 31, 2023. ​ ​ ​ 131 Table of Contents
Assuming no change in the outstanding borrowings under the Notes Purchase Agreement, we estimate that a hypothetical 1% increase in the SOFR would increase our annual interest expense by approximately $0.8 million for the year ended December 31, 2024. ​ ​ ​ 136 Table of Contents
With respect to our foreign currency exposures as of December 31, 2023, we estimate a 10% unfavorable movement in foreign currency exchange rates would have the effect of creating an additional foreign currency loss of approximately $7.4 million within other non-operating income (expense) for the year ended December 31, 2023.
With respect to our foreign currency exposures as of December 31, 2024, we estimate a 10% unfavorable movement in foreign currency exchange rates would have the effect of creating an additional foreign currency loss of approximately $11.3 million within other non-operating income (expense) for the year ended December 31, 2024.
We may use interest rate cap derivatives, interest rate swaps or other interest rate hedging instruments to economically hedge and manage interest rate risk with respect to our variable floating rate debt. As of December 31, 2023, the annual interest rate was 15.32% and the outstanding balance of the Tranche 1 Notes was $75.0 million.
We may use interest rate cap derivatives, interest rate swaps or other interest rate hedging instruments to economically hedge and manage interest rate risk with respect to our variable floating rate debt. As of December 31, 2024, the annual interest rate was 14.85% and the outstanding balance of the Tranche 1 Notes was $75.0 million.

Other MGTX 10-K year-over-year comparisons