This Quarterly Report on Form 10-Q contains forward-looking statementsregarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Any statements contained herein that are not statements of historical facts contained in this Quarterly Report on Form 10-Q may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by words such as “aim,” “anticipate,” “assume,” “attempt,” “believe,” “contemplate,” “continue,” “could,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “predict,” “potential,” “seek,” “should,” “strive,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. These forward-looking statements include, but are not limited to, statements about:
| ● | whether our available cash, cash equivalents and marketable securities, and product sales will be sufficient to fund our planned expenditures and meet our obligations in the future; |
| ● | whether we will be able to continue to maintain or increase sales for our product LOQTORZI® (toripalimab-tpzi); |
| ● | our expectations regarding our ability to develop and commercialize our product candidates; |
| ● | our ability to maintain regulatory approval for our product and our ability to obtain and maintain regulatory approval of our product candidates, if and when approved; |
| ● | our expectations regarding government and third-party payer coverage and reimbursement; |
| ● | our ability to manufacture our product and product candidates in conformity with regulatory requirements and to scale up manufacturing capacity of our product and product candidates for commercial supply; |
| ● | our reliance on third-party contract manufacturers to supply our product candidates and product for us; |
| ● | our expectations regarding the potential market size and the size of the patient populations for our product and product candidates, if approved for commercial use, and expectations regarding our ability to capture a certain percentage of those markets; |
| ● | our expectations about making required future interest and principal payments as they become due in connection with our debt obligations; |
| ● | our financial performance, including, but not limited to, projected net revenue, cost of goods sold, research and development expenses, selling and general administrative expense, and interest expense; |
| ● | the implementation of strategic plans for our business, product and product candidates; |
| ● | the initiation, timing, progress and results of future preclinical and clinical studies and our research and development programs; |
| ● | the likelihood of us receiving either of the $37.5 million payments we are eligible to receive as part of our divestiture of the UDENYCA franchise, depending on post-closing net sales of UDENYCA; |
| ● | the scope of protection we are able to establish and maintain for intellectual property rights covering our product and product candidates; |
| ● | our expectations regarding the scope or enforceability of third-party intellectual property rights, or the applicability of such rights to our product and product candidates; |
| ● | the cost, timing and outcomes of potential litigation involving our product and product candidates or other aspects of our business; |
| ● | our reliance on third-party contract research organizations to conduct clinical trials of our product candidates; |
| ● | the benefits of the use of our product and product candidates; |
| ● | our expectations about potential risks, disruptions and losses from future cyberattacks and security incidents; |
| ● | the rate and degree of market acceptance of our current or any future product and product candidates; |
| ● | our ability to compete with companies who currently are producing competitor products or will produce them in the future; |
| ● | developments and projections relating to our competitors, our market opportunity and our industry; and |
| ● | the effects of the continuation of the war in Ukraine and conflicts in the Middle East on our business and prospects. |
We have based these forward-looking statements on our current expectations about future events. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Our actual results may differ materially from those suggested by these forward-looking statements for various reasons, including those identified in Part II, Item 1A Risk Factors and discussed elsewhere in this Quarterly Report on Form 10-Q. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. The forward-looking statements included in this report are made only as of the date hereof. Except as required under federal securities laws and the rules and regulations of the Securities and Exchange Commission (“SEC”), we do not undertake, and specifically decline, any obligation to update any of these statements or to publicly announce the results of any revisions to any forward-looking statements after the distribution of this report, whether as a result of new information, future events, changes in assumptions or otherwise. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make or enter into, except for the acquisition of Surface to the extent described herein.
This Quarterly Report on Form 10-Q also contains estimates, projections, market opportunity estimates and other information concerning our industry, our business, and the markets for certain diseases, including data regarding the estimated size of those markets, and the incidence and prevalence of certain medical conditions. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained this industry, business, market and other data from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data, publicly filed reports and similar sources.
Risk Factor Summary
Below is a summary of the principal factors that make an investment in our common stock speculative or risky. This summary does not address all of the risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found in Part II, Item 1A Risk Factors and should be carefully considered, together with other information in this Quarterly Report on Form 10-Q, including our financial statements and related notes thereto, before making investment decisions regarding our common stock.
| ● | We have a limited history of profitability, which we have not maintained and may not achieve again, and only one product that has been approved and marketed and with multiple product candidates that are not approved and still in development. |
| ● | The commercial success of our existing product or any future products will depend upon the size of the applicable markets and the degree of market acceptance and adoption by prescribing physicians, healthcare providers and the patients to whom our medicines are prescribed. Additionally, obtaining placement on national and/or local clinical guidelines/pathways, as well as coverage on third-party payor formularies, can impact our short and long-term financial performance. |
| ● | Our product and our product candidates, even if approved, will remain subject to regulatory scrutiny. |
| ● | Disruptions at the U.S. Food and Drug Administration (“FDA”) and other government agencies caused by funding shortages, staffing limitations, government shut-downs or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, and conduct inspections of manufacturing facilities, or otherwise prevent new or modified products from being developed, or approved or commercialized in a timely manner or at all, which could negatively impact our business. |
| ● | Our product LOQTORZI faces, and our product candidates tagmokitug and casdozokitug, if approved, will face, significant competition from other immuno-oncology biologics and other treatment regimens. If we fail to compete effectively, we may not achieve significant market penetration and expansion. |
| ● | We face intense competition and rapid technological change and the possibility that our competitors may develop therapies that are similar, more advanced or more effective than ours, which may adversely affect our financial condition and our ability to successfully commercialize our product candidates. |
| ● | Healthcare reform measures, including the Inflation Reduction Act (“IRA”) and the One Big Beautiful Bill Act (the “OBBBA”), may increase the difficulty and cost for us to obtain marketing approval for and commercialize our product, affect the prices we may set, and have a material adverse effect on our business and results of operations. |
| ● | We are highly dependent on the services of our key executives and personnel, including our President and Chief Executive Officer, Dennis M. Lanfear, and if we are not able to retain these members of our management or recruit additional management, clinical and scientific personnel, our business will suffer. |
| ● | We rely on third parties to conduct our nonclinical and clinical studies and perform other tasks for us. If these third parties do not successfully carry out their contractual duties, meet expected deadlines or comply with regulatory requirements, we may not be able to obtain regulatory approval for or commercialize our product candidates and our business could be substantially harmed. |
| ● | We are subject to a multitude of manufacturing risks and the risks of inaccurately forecasting sales of our product. Any adverse developments affecting the manufacturing operations of our product and product candidates, including the risks associated with transitioning our biomanufacturing processes from an offshoring |
business model to an onshoring business model, could substantially increase our costs and limit supply for our product and product candidates.
| ● | The continuation of the war between Russia and Ukraine and conflicts in the Middle East may exacerbate certain risks we face. |
| ● | Our product or our product candidates may cause undesirable side effects or have other properties that could, as applicable, delay or prevent their regulatory approval, limit the commercial profile of an approved label or result in significant negative consequences following marketing approval, if granted. |
| ● | If we infringe or are alleged to infringe intellectual property rights of third parties, our business could be harmed. Third-party claims of intellectual property infringement may prevent or delay our development and commercialization efforts. |
| ● | We are heavily dependent on the development, clinical success, regulatory approval and commercial success of our product candidates. We cannot give any assurance that any of our product candidates will receive regulatory approval, which is necessary before they can be commercialized. |
