10-K

如果註冊人是《證券法》第405條所定義的知名經驗豐富的發行人，則通過勾選標記進行驗證。是的沒有 ☒

如果註冊人無需根據該法案第13或15（d）條提交報告，則通過勾選標記進行驗證。是的沒有 ☒

通過勾選標記確定註冊人是否：（1）在過去12個月內（或在註冊人被要求提交此類報告的較短期限內）提交了1934年證券交易法第13或15（d）條要求提交的所有報告，以及（2）在過去90天內是否遵守此類提交要求。是的☒沒有☐

通過勾選標記檢查註冊人是否已在過去12個月內（或在註冊人被要求提交此類文件的較短期限內）以電子方式提交了根據S-t法規第405條（本章第232.405條）要求提交的所有交互數據文件。是的☒沒有☐

通過複選標記來確定註冊人是大型加速申報人、加速申報人、非加速申報人、小型報告公司還是新興成長型公司。請參閱《交易法》第120億.2條規則中「大型加速備案人」、「加速備案人」、「小型報告公司」和「新興成長型公司」的定義。

如果是新興成長型公司，請通過勾選標記表明註冊人是否選擇不利用延長的過渡期來遵守根據《交易法》第13（a）條規定的任何新的或修訂的財務會計準則。 ☐

通過勾選標記檢查註冊人是否已提交報告並證明其管理層根據《薩班斯-奧克斯利法案》（15 U.S.C.）第404（b）條對其財務報告內部控制有效性的評估7262（b））由編制或發佈審計報告的註冊會計師事務所執行。 ☐

如果證券是根據該法案第12（b）條登記的，請通過勾選標記表明文件中包含的登記人的財務報表是否反映了對先前發佈的財務報表錯誤的更正。 ☐

通過勾選標記來驗證這些錯誤更正是否是需要根據§240.10D-1（b）對註冊人的任何高管在相關恢復期內收到的激勵性補償進行恢復分析的重述。 ☐

通過勾選標記檢查註冊人是否是空殼公司（定義見《交易法》第120億.2條）。是的否 ☒

根據截至2024年6月30日納斯達克全球精選市場報告的普通股最後售價，非關聯公司持有的註冊人普通股的大致總市值爲 $426,783,524.截至該日期，我們的高管、董事和某些股東持有的普通股已被排除在此計算之外，因爲此類人員可能被視爲關聯公司。對於其他目的，對附屬機構地位的確定不一定是決定性的確定。

這份Form 10-K年度報告包含有關我們的業務、運營和財務業績和狀況的前瞻性陳述，以及我們對業務、運營和財務業績和狀況的計劃、目標和預期。本文中包含的任何非歷史事實的陳述均可被視爲前瞻性陳述。這些表述涉及已知和未知的風險、不確定性和其他重要因素，這些因素在某些情況下是我們無法控制的，可能導致我們的實際結果、業績或成就與前瞻性表述中明示或暗示的任何未來結果、業績或成就大不相同。

在某些情況下，您可以通過諸如「目標」、「預期」、「假設」、「相信」、「考慮」、「繼續」、「可能」、「到期」、「估計」、「預期」、「目標」、「打算」、「可能」、「目標」、「計劃」、「預測」、「潛在」、「定位」、「尋求」、「應該」等術語來識別前瞻性陳述，「Target」、「Will」、「Will」和其他類似的表達，是對未來事件和未來趨勢的預測或指示，或這些術語或其他類似術語的否定。這些前瞻性陳述包括但不限於關於以下方面的陳述：

我們是一家臨牀階段的生物製藥公司，開發一系列小分子候選產品來治療嚴重疾病，包括腫瘤和肥胖。我們的計劃基於作用機制，這些機制已在具有重大未滿足醫療需求的適應症的臨牀試驗中實現了概念驗證。我們正在推進多種候選藥物，我們認爲這些藥物有可能作爲單藥或聯合療法在目標適應症中提供更好的臨牀結果。我們管道中最先進的候選產品- TERN-701、TERN-601和TERN-501 -是內部發現的。此外，我們正在努力發現TERN-800系列治療肥胖的小分子葡萄糖依賴性促胰島素肽受體（GIPR）調節劑，該調節劑有可能與胰高血糖素樣肽-1（GLP-1）受體激動劑（例如TERN-601）組合。

TERN-701 是我們專有的、口服、強效、變構BCR-ABL酪蛋白酶抑制劑（TKI），專門針對ABL肉豆蔻酸口袋治療慢性粒細胞白血病，慢性粒細胞白血病是一種始於骨髓並導致白血病細胞生長的癌症，被歸類爲孤兒適應症。Terns此前宣佈了TERN-701 1 1期CARDINAL試驗的積極早期數據，證明了令人信服的分子反應和令人鼓舞的安全性特徵，所有劑量升級隊列中沒有劑量限制性毒性（DLC）、不良事件（AE）相關的治療中止或劑量減少。預計CARDINAL將於2025年第四季度獲得更多安全性和有效性數據。

TERN-601 是我們的小分子GLP-1受體激動劑，旨在每日一次口服治療肥胖症。肥胖是一種慢性疾病，在成人、青少年和兒童中的患病率正在增加，通常定義爲體重指數（BMI）升高至30或更高。Terns此前宣佈了TERN-601 1 1期試驗的積極結果，表明儘管每三天快速調整劑量，但體重在28天內減輕了高達5.5%，並且具有良好的安全性和耐受性。TERN-601的II期CLARCON試驗於2025年3月啓動，第一例患者入組，預計將於2025年第四季度獲得12週數據。

TERN-501 是我們最初爲代謝功能障礙相關脂肪性肝炎（MASH）開發的甲狀腺激素受體β（THR-β）激動劑。自2023年8月宣佈2a期DUET試驗的積極頂線數據以來，鑑於當前對該適應症的監管和臨牀開發要求，我們決定限制MASH TERN-501開發的支出。我們繼續評估TERN-501在其他代謝疾病中的機會。

TERN-800 該系列是我們正在努力發現治療肥胖的小分子GIPR調節劑，我們相信它有可能與GL-1受體激動劑（例如TERN-601）聯合使用。我們正在優先考慮我們的發現工作，以根據內部發現和越來越多的特定科學原理來提名GIPR對抗劑開發候選人，這些科學原理支持GLP-1受體激動劑和GIPR對抗劑組合治療肥胖的潛力。

慢性粒細胞白血病被歸類爲孤兒適應症，是美國第二常見的成人發作性白血病。美國慢粒白血病的患病率約爲90，000例，預計到2030年美國將達到180，000例。2025年，美國預計將新增確診約9，560例慢性粒細胞白血病病例，預計死亡率爲1，290人。

慢性粒細胞白血病是一種起源於骨髓並導致白血病細胞生長的癌症。骨髓是大多數骨骼中的海綿狀組織，負責產生紅細胞、白細胞和血小板。當癌變的血細胞形成並擠滿骨髓中的健康血細胞時，就會發生白血病。白血病可以被定義爲急性或慢性，這是疾病在沒有治療的情況下進展得有多快的特徵。慢性白血病進展緩慢，而急性白血病往往進展迅速。慢性粒細胞白血病發展緩慢，累及骨髓中的髓系白細胞。隨着時間的推移，骨髓會產生太多的白細胞，導致多餘的細胞在血液和/或骨髓中積聚。這種類型的白血病可能是致命的，是由自然細胞分裂過程中的錯誤引起的。一種類型的錯誤被稱爲易位，當一段染色體分離並附着在另一條染色體上時，就會發生這種錯誤。這種易位的結果被稱爲融合基因，這是一種當兩個不同的基因融合在一起時形成的異常基因。慢性粒細胞白血病是由9號和22號染色體自發易位引起的。22號染色體上的斷點簇區(BCR)基因與9號染色體上的原癌基因ABL1激酶融合，形成BCR-ABL1融合癌基因。結果是9號染色體比正常長，22號染色體比正常短。異常的22號染色體被稱爲費城(Ph)染色體。

在慢性期，白血病細胞的繁殖高度依賴於組成型活性BCR-ABL酶活性，該活性驅動白血病細胞的不受調節的分裂。慢粒細胞會排擠骨髓中的健康紅血、白血和血小板細胞，並會導致虛弱、疲勞、呼吸急促、發燒、筋骨疼痛和體重減輕等症狀。如果不及時治療，慢粒細胞白血病可能會發展成爲一種潛在致命的疾病。慢性粒細胞白血病約佔成人新診斷病例的15%。平均診斷年齡約爲64歲，其中約50%的慢性粒細胞白血病患者診斷年齡超過65歲。慢性粒細胞白血病在兒童中很少出現。

活性部位TKI的開發和批准改變了慢粒治療。第一個批准的治療慢性粒細胞白血病的TKI是imatini，於2001年獲得批准。其他活性部位TKI的批准包括達沙替尼、尼洛替尼和博舒替尼分別於2006年、2007年和2012年獲得批准。這些活性部位TKI中的每一種都被批准用於新診斷或難治/不耐受患者人群。波納替尼已被批准用於T315 I突變的成年患者，該藥物也於2012年獲得批准。這些活性部位TKI的使用已將慢粒細胞白血病從致命疾病轉變爲慢性疾病，患者在診斷後可能會存活數十年。

一類新型TKI，稱爲變構TKI，以肉豆蔻酸結合口袋爲目標，將BCR-ABL 1鎖定爲非活性狀態。變構TKI對ABL 1肉豆蔻酸結合口袋具有高度選擇性，並且對其他細胞同工酶幾乎無活性，從而避免了活性位點TKI的脫靶效應。此外，活性部位口袋中的突變（例如T315 I）可能會頻繁發生，這最終可能導致活性部位TKI對慢性粒細胞白血病無效。變構TKI在很大程度上不受許多活性位點耐藥性突變的影響。第一個批准的變構TKI是ascim替尼，驗證了這種作用機制，於2021年獲得批准，並在96周內與活性部位TKI相比，臨牀療效、安全性和耐受性顯着改善。我們相信TERN-701正在生成新的數據，以支持潛在的同類最佳產品，相對於阿西替尼具有更好的療效、安全性和便利性。

伊馬替尼代表了第一個被批准的活性部位TKI，並將CML轉變爲一種可以通過慢性治療存活下來的疾病。伊馬替尼被批准用於新診斷的成人和兒童慢性期費城染色體陽性(Ph+)CML患者，以及干擾素-阿爾法治療失敗後Ph+CML慢性、加速或急變期患者。然而，接受伊馬替尼治療的患者中，大約有一半出現耐藥或不耐受，並可能進展到替代活性部位TKIs。達沙替尼、尼洛替尼和波蘇替尼被批准用於新診斷的Ph+CML慢性期和慢性、加速期或急變期Ph+CML患者，這些患者對先前的治療有抵抗或不耐受。Ponatinib被批准用於慢性期、加速期或急變期CML患者，這些患者沒有其他TKI的適應症，以及T315I突變的成年人。這些活性部位的TKI提供了比伊馬替尼更強的效力，但更差的聲發射曲線和降低的耐受性。由於耐藥或副作用不耐受，大約40%接受活性部位TKI治療的患者轉而接受替代TKI治療。儘管有仿製藥伊馬替尼的供應，但由於療效和安全性方面的很大重疊，活性部位TKI(達沙替尼、尼洛替尼和博魯替尼)在2024年累計產生了約40美元的億銷售額。

變構BCR-ABL抑制劑代表了一種新的CML治療方法，它專門針對ABL肉豆蔻囊。阿西米尼是第一個也是唯一一個被批准用於慢性粒細胞白血病的變構抑制劑。2024年1月，諾華公司宣佈了其3期研究ASC4FIRST(NCT04971226)的頂線數據，即在新診斷的(一線)CML患者中，阿西米尼與研究人員選擇的TKI的對比數據。ASC4FIRST試驗滿足了兩個主要終點，具有臨牀意義和統計意義。在新診斷的Ph+CML慢性期患者中，48周時阿西米尼的主要分子應答(MMR)率高於包括伊馬替尼、尼洛替尼、達沙替尼和波蘇替尼在內的標準治療TKI。Asciminib還顯示出良好的安全性和耐受性，與標準護理活性部位TKI相比，AEs和治療中斷次數更少，沒有觀察到新的安全信號。自2024年10月起，阿西米尼被批准用於新診斷和先前治療的CML。諾華公司預計阿西米尼在各種治療領域的億最高銷售額約爲30美元。

通過定期評估血液和骨髓測試來衡量慢性粒細胞白血病的治療反應。三種治療反應是分子反應、血液反應和細胞基因反應。

分子反應（MR）是血液中具有BCR-ABL基因的細胞數量減少。定量PCR測試用於測量含有BCR-ABL基因的血細胞數量，並以百分比進行量化。對治療的初始分子反應是結果的重要預測因素。因此，MR是監測BCR-ABL轉錄本的最敏感方法，並且在確定進一步的治療選擇方面最相關。當治療開始後3個月和6個月BCR-ABL 1水平爲10%或以下時，即可實現早期分子反應（ESM）。在ECT中，白血病細胞減少了90%或更多。當BCR-ABL 1水平下降至0.1%時，即達到MMR，表明白血病細胞已減少99.9%或更多。當BCR-ABL 1水平降至0.01%或更低時，即可實現深度分子反應（DMR）。當BCR-ABL 1水平無法檢測到時，患者已實現完全分子反應。

根據完全血細胞計數試驗的結果，血液學反應可分爲部分或完全。這項評估測量了血液中的紅細胞、白細胞和血小板的數量。當每種血細胞類型的數量開始恢復到正常水平時，就實現了部分血液學反應。當血細胞計數恢復正常並可在治療開始後一個月內觀察到時，血液學完全有效。細胞遺傳學反應是通過測量骨髓中含有費城染色體的細胞(例如，Ph+細胞)的百分比來評估的。骨髓細胞的細胞遺傳學評估每隔三個月進行一次，以評估患者對治療的反應。當超過35%的骨髓細胞中存在費城染色體時，就會產生輕微的細胞遺傳學反應。當有35%或更少的細胞具有費城染色體時，就實現了主要的細胞遺傳學反應。當在骨髓中沒有檢測到帶有費城染色體的細胞時，就實現了完全的細胞遺傳學反應。

在接受預治療的三線患者中，阿西莫替尼在6個月內在25%的患者中實現了MMR，這優於博舒替尼的MMR率13%，大約高出兩倍，足以在三線環境中獲得加速批准。當阿西莫替尼的III期研究進展到96周時，阿西莫替尼在38%的接受預治療的三線患者中實現了MMR，是博舒替尼16%的MMR緩解率的兩倍多，從而在三線環境中獲得全面批准。96周後，阿西莫替尼患者因缺乏療效或不良事件而停藥率幾乎是博舒替尼患者比例的一半（阿西莫替尼31.2% vs博舒替尼60.5%）。

除了三線治療之外，別構BCR-ABL抑制劑已被證明作爲一線慢性粒細胞白血病治療具有臨牀益處。在一線ASC 4FIRST 3期研究中，與一線環境中的標準治療TKI相比，ascim替尼在第48周時的MMR率更高（68% vs 49%）。與標準治療TKI相比，阿辛替尼還表現出良好的安全性和耐受性，AE和治療中止較少。總體而言，與imatini和第二代TKI相比，ascim替尼在第48周時的EMI和DMR發生率更高，並且具有明顯有利的安全性和耐受性特徵。2024年10月，阿西莫替尼獲得加速批准，用於新診斷的ph陽性慢性期慢性粒細胞白血病。

由於（1）越來越多的患者對當前治療標準變得難治或不耐受，（2）用於對既往TKI治療耐藥或不耐受的CML患者的活性位點TKI的安全性問題，以及（3）活性位點TKI難以治療的BCR-ABL突變（例如，T315 I）。

慢性粒細胞白血病患者的預期壽命幾乎與健康成年人一樣長，而且慢性粒細胞白血病治療對很高比例的患者來說是終身的。因此，在通常長達數十年的治療期內，治療被選擇和修改，以滿足個別患者隨着時間的推移的CML疾病的病程以及患者隨着年齡的增長的個人需求。最近的一份出版物估計，大約40%的人開始使用任何一種TKI切換到另一種TKI。醫生根據治療的分子反應以及其他個別患者的需求(包括藥物耐受性、合併症和藥物-藥物相互作用特徵)指導治療決策，這些需求可能會隨着時間的推移而演變。例如，接受尼洛替尼治療的患者可能會改用伊馬替尼和博蘇替尼，這兩種藥物是心血管或外周動脈合併症患者的首選治療方案，而尼洛替尼則不是那麼受歡迎。相比之下，尼洛替尼和達沙替尼可能被選爲胃腸道或腎臟合併症患者的替代療法，在這些患者中，伊馬替尼和博蘇替尼不太被推薦。慢性粒細胞白血病患者的存活率和治療持續時間持續增加。因此，醫生們正在尋找更多安全、有效和耐受性良好的新療法，以滿足患者隨着時間的推移不斷變化的需求。在以後的慢性粒細胞白血病治療中，患者可能會遇到更大的不耐受挑戰。對於兩次或兩次以上TKI失敗的患者，高達55%的患者對以前的TKI不耐受。即使是低級別、慢性的TKI不耐受也會影響患者對治療的依從性，這反過來可能導致更差的結果。

在使用抑制BCR-ABL酶活性的藥物治療期間，白血病細胞也可能出現耐藥突變，這可以阻止活性位點TKI的結合並使其無效。大約15%至20%的患者出現BCR-ABL突變或分子異常。T315 I代表活性位點突變的一種變體，使大多數活性位點TKI無效。波納替尼是唯一一種獲准用於治療T315 I突變患者的活性部位TKI，但帶有心血管和其他毒性的黑匣子警告。二線和三線治療的潛在耐藥性可能會導致療效結果較差並增加停藥風險。BCR-ABL酶域內的突變也可能影響大多數活性位點TKI結合和抑制BCR-ABL的能力。

與肉豆蔻酸結合口袋結合的變構TKI代表了一種新型的慢性粒細胞白血病治療類別，並有可能解決活性部位TKI的缺點，包括脫靶活性和針對活性部位耐藥性突變的療效有限。阿辛替尼是第一種批准的變構TKI，也適用於治療T315 I突變患者的慢性粒細胞白血病，儘管其每日總劑量是治療無T315 I患者的五倍。高劑量阿西替尼與安全性和耐受性問題有關，可能導致T315 I型慢粒患者的依從性降低。儘管變構TKI相對於活性部位TKI具有顯着優勢，但作爲一個類別，我們相信阿西替尼爲開發同類最佳變構TKI提供了機會，具有更好的功效、安全性和便利性。

TERN-701旨在解決活性部位TKIs的侷限性，目標是通過以下組合實現更好的腫瘤抑制：(1)提高對抗BCR-ABL的療效，包括廣泛的突變；(2)改善安全性和耐受性；(3)改善藥物相互作用；(3)無論是否進食，所有患者都可以每天給藥一次，從而提高便利性。支持療效的數據包括在數字上比阿司米尼對多種bcr-abl變種的效力更強，改善的藥代動力學(PK)和比阿西米尼更好的靶向覆蓋，以及在阿斯米尼失效時臨牀反應的挽救。與阿司米尼相比，TERN-701也顯示出良好的安全性，在我們的第一階段試驗的劑量遞增階段，沒有DLTS，也沒有與AE相關的治療中斷或劑量減少。在健康志願者研究中，TERN-701還證明了在不考慮食物的情況下每天給藥一次的能力，以及良好的藥物相互作用情況，這代表了與阿司米尼相比的潛在關鍵區別。

考慮到新興的臨牀情況，我們相信TERN-701在一線和二線患者設置中有廣闊的機會。在一線，變構類藥物已經顯示出比活性部位TKI的改進，TERN-701正在構建一種差異化的配置文件，與阿司米尼相比，它有可能提供更高的療效、安全性和便利性。因此，如果TERN-701成功完成臨牀開發並獲准上市，我們就有機會治療相當大比例的新診斷患者。我們預計，由於成本的原因，將有很大一部分一線患者開始使用通用的主動站點TKI。根據歷史數據，大約40%開始使用活性部位TKI的患者將由於反應和/或耐受性不佳而需要切換治療，並可能切換到變構TKI。如果被批准上市，我們相信TERN-701可以被定位爲所有轉向變構TKI的患者的選擇。在迄今爲止的第一階段數據中，TERN-701在對活性部位TKI和阿司米尼的反應不佳或不耐受的患者中顯示出令人信服的分子反應。醫生和慢性粒細胞白血病患者繼續尋求新的治療方法，以提供更好的療效、安全性和便利性。

2020年7月，漢索（上海）健康科技有限公司有限公司和江蘇瀚碩製藥集團有限公司（統稱瀚碩）獲得了TERN-701在大中華地區開發的許可。Hansoh將TERN-701稱爲HS-10382。2022年5月，Hansoh在對既往活性部位BCR-ABL TKI治療有耐藥或不耐受的慢性或加速期慢性粒細胞白血病患者中啓動了一項開放標籤、多中心、劑量增加和擴展、首次人體研究。Hansoh負責大中華地區的所有開發成本，包括正在中國進行的第一階段試驗。

我們的1期試驗CARDINAL正在進行中，其中包括來自美國、歐洲和其他國家的研究中心。2024年3月，FDA授予TERN-701治療慢性粒細胞白血病的孤兒藥稱號。

Cardinal試驗是一項正在進行的全球性、多中心、開放標籤、兩部分的1期臨牀試驗，旨在評估TERN-701在以前治療過的CML患者中的安全性、PK和有效性。第一部分是試驗的劑量遞增部分，評估每天一次的TERN-701單一療法，在多達60名確診爲BCR-ABL且有治療失敗或對至少一種第二代TKI(尼洛替尼、達沙替尼或博蘇替尼)療效不佳的第二代TKI的慢性期CML患者的最多五個劑量隊列中。對先前的TKI治療(包括阿西米尼)不耐受的參與者也被允許。第1部分的主要終點是第一個治療週期中DLTS的發生率，以及安全性和耐受性的其他衡量標準。次要終點包括TERN-701PK和療效評估，如血液學和分子反應，通過bcr-abl轉錄本水平的變化來衡量。起始劑量爲160毫克，每日一次，劑量遞增高達500毫克，每日一次，並可選擇較低劑量的80毫克，每日一次。

第2部分是該試驗的劑量擴展部分，將招募約40名患者，隨機接受根據第1部分的數據選擇兩劑TERN-701中的一劑每日一次治療。該試驗劑量擴展部分的主要終點是療效，通過血液學和分子反應來衡量。次要終點包括安全性、耐受性和PK。CARDINAL試驗的總體目標是選擇TERN-701的最佳劑量，以推進慢性期慢性粒細胞白血病的潛在關鍵試驗。

2024年12月，我們宣佈了CARDINAL試驗第1部分劑量升級部分的積極早期數據。截至2024年10月截止日期，15名患者入組了160毫克（n=7）、320毫克（n=5）和400毫克（n=3）三個劑量水平的TERN-701，每日一次給藥，總體中位治療持續時間爲3個月（範圍0.79 - 7.5個月）。入組患者接受過多次預治療，中位數爲4次TKI（範圍：1 - 6），80%的患者接受過3次或以上TKI。分別有47%和40%的患者此前曾接受過波那替尼和阿西替尼。73%的人在基線時沒有MMR，60%的人的基線BCR-ABL轉錄本>1%國際量表。截至數據截止日期，15名患者中有14名仍在接受治療。

12名患者的療效可評估，定義爲具有基線BCR-ABL轉錄本和至少兩個基線後BCR-ABL轉錄本水平（集中評估）。所有療效可評估患者均處於160毫克和320毫克劑量水平。

TERN-701在160毫克至400毫克劑量水平上表現出非常令人鼓舞的安全性特徵，截至數據截止日期，500毫克劑量正在接受評估。

在這個接受過大量治療的人群中，治療後出現的血液學AE的發生率明顯較低，沒有3級或以上的治療相關血細胞減少症。沒有嚴重程度超過2級的非血液學治療相關AE。最後，肝臟和胰酶、血壓和其他生命體徵或心電圖沒有觀察到有臨牀意義的變化。

數據截止日期時160毫克和320毫克劑量水平的穩態PK數據顯示線性PK，暴露量呈劑量比例增加。每日一次給藥後，TERN-701的血漿蛋白結合修正Caverage超過了多種突變和非突變BCR-ABL變體的體外IC 90。重要的是，在160毫克和320毫克QD下，TERN-701的平均自由藥物濃度分別比體內暴露高出約4倍和8倍，在體內暴露中觀察到BCR-ABL信號途徑的強效抑制作用，這表明這些臨牀劑量下具有強大的藥效學（PD）效果。

截至2024年12月，CARDINAL研究入組了19名患者，其中包括500毫克隊列，所有劑量增量隊列至少入組了3名患者。新參與者的回灌給藥在現有的劑量增加隊列中繼續進行。該研究有望在2025年第二季度啓動劑量擴展，預計2025年第四季度將獲得額外的安全性和有效性數據。這些數據預計將包括更大的治療持續時間更長的患者隊列，以及可能首次查看六個月MMR數據（這是慢性粒細胞白血病的批准終點）。

肥胖是一種慢性疾病，在成人、青少年和兒童中的患病率正在增加，被定義爲BMI爲30或更大（計算爲體重（公斤）除以身高（米平方））。導致肥胖的機制包括久坐的生活方式、卡路里攝入量增加以及胰島素和抗精神病藥物等藥物。胰島素抵抗是代謝綜合徵的標誌，也在肥胖中發揮着關鍵作用。

肥胖是一種主要的健康流行病，已被美國醫學會宣佈爲一種疾病，影響全球人口。肥胖行動聯盟（OAC）估計，近9300萬美國人患有肥胖症，預計未來五年內這一數字將增加到12000萬美國人。此外，美國疾病控制中心（CDC）估計，42%的20歲以上成年人患有肥胖症。

根據OAC的數據，有40多種健康狀況與肥胖有關。最常見的肥胖相關疾病包括心臟病、2型糖尿病、中風、膽囊病、胃食道反流病、某些形式的癌症、睡眠呼吸暫停或呼吸問題以及各種其他疾病。根據《管理醫療和專科藥房雜誌》的數據，2016年，美國成年人因肥胖而產生的總醫療成本爲2,600美元億。先前一項關於肥胖導致的未來醫療成本的研究預測，到2030年，這些年度支出將每十年翻一番，達到約7,800美元億，佔美國總醫療成本的14%。因此，世界各地的公共和私人利益攸關方都在採取措施解決肥胖問題。儘管公衆對肥胖流行病的認識不斷提高，以及與肥胖相關的巨大藥物經濟學成本，但我們認爲，對安全、耐受和有效的藥物干預的需求仍然沒有得到滿足。

肥胖症的治療包括生活方式改變、藥物治療、手術和設備植入。生活方式改變、飲食和鍛鍊是目前肥胖症首選的初步治療方法。然而，長期持續改變生活方式的需求往往會導致消耗，通常導致體重回升。當僅改變生活方式失敗時，通常建議進行藥物治療。隨着2021年和2023年推出索馬魯肽和替西帕特（這兩種藥物均被批准用於慢性體重管理），到2035年，全球肥胖市場預計將超過1000億美元，預計還會推出額外的注射劑和口服治療。

GL-1受體激動劑旨在解決肥胖和其他代謝適應症發病機制中涉及的代謝過程。導致體重增加的機制包括久坐的生活方式、卡路里攝入量增加以及胰島素和抗精神病藥物等藥物。胰島素抵抗是代謝綜合徵的標誌，也在肥胖中發揮着關鍵作用。天然內源性配體GL-1在食物攝入後以葡萄糖依賴性方式促進胰腺β細胞分泌胰島素。研究還表明，GLP-1可以減少肝臟中的胰高血糖素分泌，減緩腸道中的胃排空，在大腦中產生飽腹感，減少炎症並改善心臟功能。因此，合成的GLP-1肽已被批准用於治療肥胖症和糖尿病，並在其他代謝疾病中具有治療潛力。

GLP-1化合物快速發展的開發格局多種多樣，包括單一激動劑、多激動劑、激動劑-受體組合，通常可以按給藥途徑和擬肽與新型小分子結構進行分組。GLP-1 R的肽類似物主要通過注射途徑給藥。擬肽GLP-1 R的口服給藥製劑是可用的，並且正在開發中，通常受到腸吸收水平低的限制，而GLP-1 R的口服小分子激動劑被設計爲具有更高的口服吸收。

臨牀試驗中證明了口服小分子GLP-1受體激動劑減肥的概念驗證，驗證了這種作用機制。正在開發的口服GLP-1受體激動劑，例如阿雷尼隆、奧福格列普隆和達努格列普隆，在12周內，安慰劑調整後的體重減輕了5-7%。服用24周和36周的時間更長，奧福格列普隆的體重減輕了10- 12%。

批准的藥物是合成肽，可能需要通過皮下注射給予更高劑量才能治療肥胖。注射給藥途徑可能會限制其在肥胖患者中的使用，特別是如果可以獲得有效的口服治療。

口服小分子治療已證明體重顯着減輕，但仍受到胃腸道AE發生率高的限制。在2期或12周的環境中，領先的小分子GLP-1、阿連尼普羅隆、奧福利普羅隆和達努利普羅隆的噁心率在~70%-90%之間，嘔吐率在~50-60%之間，腹瀉率高達60%。人們採用了漫長而複雜的劑量調整方案，試圖緩慢地適應患者並減少目標劑量下的胃腸道副作用。該劑量調整方案需要大量的劑量調整步驟（達努格列普隆最多11個步驟），並且起始劑量與目標劑量之間發生很大的變化（阿雷尼普隆變化24倍）。因此，通過胃腸道AE衡量，仍有很大的機會獲得一流的口服小分子藥物，具有競爭力的減肥、簡單的劑量調整和出色的耐受性。

TERN-601是一種口服小分子GLP-1受體激動劑。我們主要的GLP-1受體激動劑的內部發現是由許多GLP-1受體激動劑化合物的計算相互作用繪圖、化學合成和體外鑑定驅動的。通過這個過程，我們發現了TERN-601，它是一種有效的GLP-1受體激動劑，部分偏向於產生環磷酸胺而不是招募β-抑制蛋白。

2024年9月，我們宣佈了1期試驗的積極結果，表明儘管每三天快速調整劑量，但體重在28天內減輕了高達5.5%，並且具有良好的安全性和耐受性。重要的是，TERN-601沒有表現出AE相關的停藥、中斷或劑量減少。大多數GI相關AE均爲輕度，沒有嚴重或嚴重AE，肝酶也沒有有臨牀意義的變化。

根據第一階段的結果，我們相信TERN-601完全有能力在第二階段、爲期12周的環境中證明差異化的耐受性特徵，與第一階段相比，劑量調整較慢。在達到目標劑量之前，每個中間劑量的第二階段劑量將在兩到四周之間。在一項爲期12周的研究中，在領先的口服小分子GLP-1 R激動劑中，該劑量調整設計的步驟最少，目標劑量變化倍數最低。我們的緩慢劑量調整旨在實現有競爭力的12周減肥、同類耐受性最佳以及口服小分子類別中最簡單的劑量調整。

TERN-601的1期試驗是一項隨機、雙盲、安慰劑對照的單次和多次給藥（SAD和MAD）試驗，旨在評估TERN-601在肥胖或超重的健康成年人中的安全性、耐受性、PK和PD。審判由兩部分組成。

第1部分是一項SAD研究，評估了BMI & 25 kg/m的健康參與者的五種TERN-601劑量水平2 且< 40公斤/米2. TERN-601的起始劑量爲30毫克，後續劑量水平基於對之前隊列新出現的安全性和PK數據的審查。

第2部分是一項MAD研究，其中肥胖和超重的健康成年人被納入隊列，其中包括根據第1部分的數據選擇的劑量對TERN-601進行劑量調整，持續28天。第2部分包括BMI ' 27公斤/米的健康參與者2 至< 40公斤/米2.

該試驗的主要終點是評估TERN-601每日一次給藥，持續28天的安全性和耐受性。次要終點包括PK、TERN-601治療28天后通過體重減輕來衡量的療效以及其他探索性標誌物。

臨牀試驗結果顯示，TERN-601耐受性良好，並在28天MAD研究中評估的所有三種劑量中表現出劑量依賴性、統計學顯著性安慰劑調整後的平均體重減輕，最高劑量740毫克QD時，安慰劑調整後的最大平均體重減輕爲4.9%（p<0.0001）。

儘管快速調整至高劑量，TERN-601的耐受性良好，任何劑量均未出現治療相關劑量中斷、減量或停藥。大多數（>95%）治療後出現的AE都是輕度的。所有胃腸道事件均爲輕度至中度，與GLP-1 R激動劑類別一致。重要的是，沒有觀察到肝酶、生命體徵或心電圖有臨牀意義的變化。儘管在這項爲期28天的研究中積極調整至高劑量，但沒有出現治療相關的劑量中斷、減量或停藥，大多爲輕度AE，這表明在後續研究中，緩慢調整的耐受性有可能進一步改善。

TERN-601具有獨特的性質，這可能對口服GLP-1 R激動劑有利。其低溶解度和高腸道滲透性可能會導致吸收時間延長，從而實現持續的目標覆蓋和平坦的PK曲線，而腸道壁中的高藥物水平可能會導致腸道中強烈的GLP-1 R激活，從而觸發大腦中的飽腹感中心。此外，TERN-601在循環中的自由分數較低，再加上平坦的PK曲線，可能使TERN-601在高劑量給藥時耐受良好。

TERN-601的2期獵鷹試驗於2025年3月開始，第一名患者入選。Falcon是一項總部位於美國的多中心、隨機、雙盲、安慰劑對照試驗，旨在評估每天服用一次的TERN-601的療效和安全性。這項試驗將評估肥胖或超重的成年人，他們沒有糖尿病，體重指數在≥30到<50 kg/m之間2 或≥27至<30千克/米2至少有一種與體重相關的合併症。患者將被隨機分配到四個活躍的隊列中(每個隊列30個)：250毫克、500毫克、500毫克緩慢滴定、750毫克或安慰劑。主要終點是12周內與安慰劑相比，體重與基線相比的百分比變化。次要終點包括安全性、耐受性和患者體重減輕5%或更高的比例。第二階段12周的數據預計將在2025年第四季度公佈。我們相信TERN-601有潛力成爲一種差異化的口服小分子GLP-1R激動劑，在12周的研究中具有競爭性的體重減輕和卓越的耐受性。

TERN-501 - 具有增強代謝穩定性和肝臟分佈的選擇性THR-β激動劑

TERN-501是一種選擇性的Thr-β激動劑，具有增強的代謝穩定性和肝臟分佈，與其他Thr-β候選藥物相比，這些特性旨在提高安全性和有效性。Thr-β是肝臟中甲狀腺激素受體的主要形式，調節能量代謝的關鍵方面，包括脂肪酸和脂肪的合成，以及通過誘導脂肪酸氧化來清除肝臟脂肪。Thr-β的激活通過線粒體氧化增加脂肪酸代謝，影響膽固醇的合成和代謝。因此，Thr-β刺激有可能提供廣泛的代謝益處，包括減少肝臟脂肪變性，增加脂肪氧化，改善纖維化和血脂參數，如低密度脂蛋白膽固醇和甘油三酯。Thr-β刺激已被確定爲間質性肝炎的靶點，因爲它具有減少肝臟脂肪變性、改善纖維化和改善患者血脂參數的潛力。對於任何蘇氨酸受體激動劑來說，一個關鍵的問題是過量的系統性蘇氨酸受體-α刺激的毒性。TER501對Thr-β的選擇性是對Thr-α激活的23倍，從而將Thr-α刺激引起的心臟毒性風險降至最低。TERN-501還具有很高的代謝穩定性和較低的預計臨牀劑量，我們認爲這使它成爲固定劑量組合聯合制劑的一個有吸引力的候選藥物。

自2023年8月宣佈2a期DUET試驗的積極頂線數據以來，鑑於當前對該適應症的監管和臨牀開發要求，我們決定限制MASH TERN-501開發的支出。我們繼續評估TERN-501在其他代謝疾病中的機會。

非臨牀數據表明，TERN-501可能會增強GLP-1受體激動劑的減肥效果。2023年，我們在飲食誘導的肥胖小鼠模型中啓動了一項TERN-501與GLP-1受體激動劑索馬魯肽的研究。在這個非臨牀模型中，小鼠餵食高熱量飲食以誘導超重和肥胖。研究組包括瘦小鼠、溶劑對照、TERN-501單藥治療、索馬魯肽單藥治療和索馬魯肽與TERN-501聯合給藥。治療10周後，我們觀察到，雖然單用索馬魯肽的體重減輕超過20%，但索馬魯肽與高劑量TERN-501聯用顯着促進了單用索馬魯肽的體重減輕，體重減輕超過30%。

基於這些非臨牀數據，THR-β激動作用是對GLP-1受體對抗作用的補充機制，除了增加體重減輕外，還可能提供更廣泛的代謝和肝臟益處。這些臨牀前聯合數據支持TERN-501作爲注射和口服GLP-1激動劑的聯合伴侶用於治療肥胖症和其他代謝疾病的潛力。

GIP是根據營養攝入而分泌的，通過激活胰腺β細胞和各種組織中的其他細胞中的關聯GIPR，以葡萄糖依賴性的方式增強膳食刺激的胰島素分泌。在臨牀前研究中，GIPR激活與其腸促胰島素伴侶GLP-1結合使用時似乎可以減少食物攝入並促進體重減輕。GIP和GL-1的重疊減肥作用表明，這兩種肽激素的作用結合起來可能會增強比單個藥物觀察到的降血糖和食慾抑制作用。

作爲我們正在進行的治療肥胖症發現工作的一部分，我們正在探索我們的主要GIPR調節劑系列，以確定開發候選物。我們計劃將口服小分子GIPR調節劑與口服小分子GL-1受體激動劑（例如TERN-601）結合起來，用於治療肥胖和代謝疾病。

我們正在優先考慮其發現工作，即根據內部發現和越來越多的科學原理提名GIPR受體阻滯劑開發候選人，這些發現支持GLPR-1激動劑/GIPR受體阻滯劑組合作爲肥胖治療的潛力。

我們沒有擁有或運營用於生產任何候選藥物的生產設施，也沒有計劃在可預見的未來發展自己的生產業務。我們目前依賴並預計將繼續依賴第三方合同製造商來生產我們所有用於臨牀前研究和臨牀試驗的候選藥物。我們沒有與任何這些第三方簽訂長期協議。

如果我們的任何候選藥物獲得任何監管機構的批准，我們打算與第三方合同製造商和一個或多個備用製造商就這些藥物的商業生產達成協議。我們開發的任何藥物的開發和商業批量都需要在符合FDA和我們尋求批准的其他司法管轄區監管機構要求的設施和流程中生產。

我們打算在我們的藥物療法獲得監管機構批准之前的適當時間在關鍵地區建立有針對性的商業基礎設施。我們希望通過內部資源和第三方關係管理銷售、營銷和分銷。

此外，我們還將在美國以外的領土上探索商業化合作夥伴關係。隨着我們的候選藥物在我們的管道中取得進展，我們的商業計劃可能會發生變化。臨牀數據、開發項目的規模、目標市場的規模、商業基礎設施的規模和製造需求都可能影響我們的商業化戰略。

生物技術行業競爭激烈，並受到快速而重大的技術變革的影響。我們相信我們的管道、開發經驗和科學知識爲我們提供了競爭優勢。然而，我們面臨着來自許多不同來源的潛在全球競爭，包括大型跨國製藥公司、成熟的生物技術公司以及小型或早期階段的生物技術公司。此外，學術機構、政府機構以及其他從事研究的公共和私人組織可能會就潛在競爭性產品或技術尋求專利保護。

我們了解到有製藥和生物技術公司擁有慢性粒細胞白血病開發計劃。最近參與或正在參與慢粒治療開發的公司包括但不限於Ascentage Pharma Group、BristolMyers Squibb Company、Enliven Therapeutics Inc.、江蘇漢碩製藥集團有限公司，諾華製藥公司，輝瑞公司，深圳市Target Rx，Inc.，太陽製藥工業有限公司，和武田製藥公司，公司

我們知道製藥和生物技術公司都有肥胖症開發計劃。參與肥胖治療開發的公司包括但不限於Abbvie Inc.、Altimune，Inc.，安進公司，Ascletis Pharma，Inc.，阿斯利康有限公司、勃林格殷格海姆有限公司、禮來公司、吉利德科學公司，韓美製藥公司，江蘇漢碩製藥集團有限公司，江蘇恒瑞製藥有限公司，Kailera Therapeutics，默克公司，Metsera Inc.，LG化學有限公司諾和諾德公司、輝瑞公司、Regor Therapeutics Group，Rhythm Pharmaceuticals，Inc.，Rivus Pharmaceuticals，Inc.，羅氏控股股份公司、Shionogi & Co. Ltd、Sciwind Biosciences Co.、有限公司，結構治療公司，Viking Therapeutics，Inc和Zealand Pharma A/S。

我們的許多競爭對手比我們擁有更多的財力、技術、人力和其他資源，而且可能更有能力開發、製造和銷售技術領先的產品。此外，在許多情況下，我們的競爭能力可能會受到保險公司或其他尋求鼓勵使用仿製藥的第三方付款人的影響。目前市場上有針對我們正在尋求的某些適應症的仿製藥，預計未來幾年將有更多的仿製藥上市。如果我們的候選產品獲得批准，我們預計它們的定價將顯著高於競爭對手的仿製藥。此外，這些競爭對手中的許多人在進行新藥品的臨牀前研究和人體臨牀試驗以及獲得人類治療產品的監管批准方面比我們擁有更多的經驗。因此，我們的競爭對手可能會成功地獲得FDA對優質產品的批准。我們的許多競爭對手已經建立了產品商業化的分銷渠道，而我們沒有這樣的渠道或能力。此外，許多競爭對手擁有更高的知名度和更廣泛的合作關係。規模較小和處於早期階段的公司也可能成爲重要的競爭對手，特別是通過與大型老牌公司的合作安排。儘管我們相信我們的產品候選計劃具有吸引力，但我們不能保證我們的產品將在監管或市場上取得成功。我們的競爭對手可能比我們更快地獲得監管機構對其產品的批准，或者獲得專利保護或其他知識產權，這些限制了我們開發或商業化我們的候選藥物或任何未來候選藥物的能力。我們的競爭對手也可能開發比我們的藥物更有效、更方便、更廣泛使用和更便宜的藥物，或者具有更好的耐受性。在製造和營銷他們的產品方面，這些競爭對手也可能比我們更成功。如果我們無法與上述公司或其他公司競爭，可能會阻礙我們按計劃將產品推向市場的能力。

我們的候選藥物以及我們的發現計劃、流程和專業知識的專有性質和保護對我們的業務非常重要。對於我們的管道候選藥物專利組合，我們尋求涵蓋物質成分以及使用和製造方法的專利保護。我們的政策是追求、維護、捍衛和執行戰略領域的專利權，無論是內部開發的還是從第三方獲得許可的，並保護對我們的業務發展具有商業重要性的技術、發明和改進。我們還依賴商業祕密、機密信息和其他對我們業務發展可能很重要的專有知識。截至2025年2月16日，我們擁有和獨家許可的專利組合包括：

我們的商業成功將在一定程度上取決於獲得和維護我們當前和未來候選藥物的專利保護，以及成功地保護這些專利免受第三方的挑戰。我們阻止第三方製造、使用、銷售、提供銷售或進口我們藥品的能力在很大程度上取決於我們在涵蓋這些活動的有效和可執行專利下擁有的權利的程度。我們不能確定是否會將專利授予我們擁有或許可的任何未決專利申請，或未來我們提交或許可的任何專利申請，也不能確保未來可能授予我們或由我們許可的任何專利在保護我們的候選藥物、發現計劃和過程方面將是商業有用的。此外，我們不能確保我們擁有或許可的任何專利不會受到挑戰、無效或規避，或者這些專利將在保護我們的技術方面具有商業用途。

個別專利的期限取決於獲得專利的國家的法律期限。在我們提交申請的大多數國家，包括美國，專利期爲自提交非臨時專利申請的最早日期起20年。在美國，在某些情況下，涵蓋FDA批准的藥物的專利期限也可能有資格延長專利期限，這允許延長專利期限，作爲對FDA監管審查過程中失去的專利期限的補償。1984年《藥品價格競爭和專利期限恢復法》允許這種專利期限在專利到期後最多延長五年，但專利期限延長不能超過自產品批准之日起總共14年。在那些有資格延期的專利中，只有一項專利可以延期，要求產品、產品的使用方法或產品的製造方法的任何符合延期資格的專利的可延期數量取決於各種因素，包括專利發佈的日期和與監管審查期限有關的某些日期。歐洲和其他一些外國司法管轄區有條款可以延長涵蓋經批准的藥物的專利的期限。未來，如果我們的藥物獲得FDA或類似的外國批准，我們預計將向可延長專利期的適用當局申請延長這些藥物的專利期限，包括美國專利商標局或USPTO。不能保證包括USPTO在內的適用當局會同意我們對是否應批准此類延期的評估，以及如果批准，此類延期的期限。

除了專利保護，我們還依靠商標註冊、商業祕密、專有技術、其他專有信息和持續的技術創新來發展和保持我們的競爭地位。我們尋求保護和維護我們業務的專有信息的機密性，這些信息不受專利保護或我們認爲不適合專利保護。我們通過與第三方簽訂保密協議，以及與員工、顧問和顧問簽訂保密信息和發明協議，採取措施保護我們的專有信息，包括商業祕密和非專利技術。然而，我們不能保證所有此類協議都已正式執行，任何一方都可能違反協議並披露我們的專有信息，包括我們的商業祕密和非專利技術，我們可能無法就此類違規行爲獲得足夠的補救措施。強制執行一方非法披露或挪用商業祕密的主張是困難、昂貴和耗時的，結果是不可預測的。此外，美國國內外的一些法院不太願意或不願意保護商業祕密。

此外，第三方仍然可能獲得此專有信息，或者可能獨立地獲得此或類似信息，我們無權阻止他們使用該信息與我們競爭。如果發生其中任何事件，或者如果我們以其他方式失去對商業祕密的保護並知道該信息的價值可能會大幅降低，我們的競爭地位就會受到損害。如果我們在此類發佈之前沒有申請專利保護，或者如果我們無法以其他方式保持我們專有技術和其他機密信息的機密性，那麼我們獲得專利保護或保護我們商業祕密信息的能力可能會受到損害。

像我們這樣的生物技術公司的專利地位通常是不確定的，涉及複雜的法律、科學和事實問題。我們的商業成功還將在一定程度上取決於不侵犯第三方的專有權。目前尚不確定，頒發任何第三方專利或其他知識產權或其他專有權利是否會要求我們改變我們的開發或商業戰略，或我們的任何候選藥物或工藝，獲得許可證或停止某些活動。我們違反任何許可協議或未能獲得開發或商業化我們未來藥物所需的專有權的許可，可能會對我們產生實質性的不利影響。如果第三方在美國準備和提交的專利申請也要求我們擁有權利的技術，我們可能不得不參與美國專利商標局的干擾或派生程序，以確定發明的優先權。關於與知識產權有關的風險的更多信息，請參見項目1A。「風險因素--知識產權相關的風險。」

於2020年7月，我們與Hansoh訂立獨家選擇權及許可協議，據此，吾等向Hansoh授予獨家選擇權，以便根據我們擁有或控制的若干專利及其他知識產權，包括聲稱我們的bcr-abl融合基因的小分子變構抑制劑TERN-701的組合物及其使用方法的專利，獲得獨家、可再許可及享有專利權的許可，以研究、開發、製造、使用、分銷、銷售及以其他方式開發含有TERN-701的治療產品，或Hansoh產品，用於所有預防性、姑息性、治療和/或診斷在中國大陸中國、臺灣、香港和澳門或漢索地區腫瘤學領域的人類疾病和障礙方面的應用。2021年11月，漢索根據獨家選擇權和許可協議的條款行使了授予TERN-701許可的選擇權。我們保留授權給Hansoh的某些專有技術下的共同獨家權利，以及腫瘤學和Hansoh領域以外的專利權下的所有權利。根據期權和許可協議的條款，Hansoh必須以商業上合理的努力在Hansoh地區開發和商業化Hansoh產品，Hansoh不得在Hansoh地區使用與Hansoh產品具有相同主要作用機制的任何其他產品。

作爲獨家選擇權的對價，我們收到了一筆80美元的萬預付款，這筆款項在漢索於2021年11月行使其選擇權時不可退還。根據許可證，漢索已同意在與漢索產品相關的預先指定的臨牀、監管和銷售里程碑實現後，向我們支付高達6,700美元的萬。根據這一選項和許可協議，到目前爲止還沒有達到這樣的里程碑。漢索還必須向我們支付所有漢索產品淨銷售額中個位數百分比的特許權使用費。特許權使用費費率受到慣例的降低，包括基於對漢索產品的仿製藥競爭的降低，以及根據該第三方權利的許可向任何第三方支付的特許權使用費，這些權利是將漢索產品商業化所必需的。特許權使用費期限將在下列時間終止：(I)該漢索產品在該國的許可專利權內的最後一項有效權利要求的到期日；(Ii)該漢索產品在該國的法規排他性喪失；以及(Iii)該漢索產品在該國家/地區首次商業銷售的十週年。

從本期權和許可協議項下的活動中開發的、對於開發TERN-701或Hansoh產品是必要或有用的知識產權，由一方單獨開發的知識產權應歸該方所有，共同開發的知識產權應共同擁有。Hansoh將擁有在Hansoh領地起訴、維護、捍衛和執行許可專利權的首要權利。

選擇權和許可協議將在漢索地區的漢索產品的最後一個到期的特許權使用費期限到期時到期。在期權和許可協議到期後，根據我們的專有技術授予Hansoh的許可應被視爲全額繳足、永久和共同獨家。如果另一方嚴重違反協議，且未能在書面通知發出後90天內糾正該違約行爲，或在另一方無力償債的情況下，我們或Hansoh均可終止期權和許可協議。Hansoh可提前180天書面通知終止期權和許可協議。如果我們發生某些控制權變更事件，Hansoh也可以提前60天書面通知終止期權和許可協議。如果在此類控制權變更事件發生時，Hansoh終止期權和許可協議，則我們必須與Hansoh協商轉讓我們在Hansoh區域內對TERN-701和Hansoh產品的全部權利、所有權和權益的條款，包括其中的所有知識產權，並且Hansoh應向我們提供此類轉讓的公平市場價值。

2019年6月，我們與Vintagence Biotechnology Ltd.簽訂轉讓協議，或Vintagence，據此Vintagence將某些針對THR-β激動劑的全球知識產權和專有技術轉讓給我們。特別是，我們已被轉讓中國專利申請以及由此在任何國家產生或衍生的任何專利或專利申請、專業知識以及與我們的THR-β計劃相關的潛在某些其他專利或專利申請的所有權利、所有權和利益。我們還有權將根據轉讓協議授予我們的權利許可給我們的附屬公司、被許可人或承包商。我們將負責所有監管活動，包括獲得產品的監管批准。

我們必須在商業上合理的努力來開發和商業化基於幾個主要市場領域中的指定知識產權的產品。

在轉讓協議有效期內，Vintagence及其附屬公司不得開發、製造、商業化或以其他方式開發任何轉讓專利權所涵蓋的任何化合物。如果Vintagence開發的Thr-β激動劑不在分配的專利權範圍內，我們將有權(但沒有義務)談判轉讓或許可，以便在全球範圍內獨家開發、製造、商業化或以其他方式開發此類激動劑。作爲這項任務的初始對價，我們向Vintagence支付了500元萬(70美元萬)的預付款。作爲額外的考慮，我們需要在與協議涵蓋的產品相關的特定開發、臨牀和監管里程碑事件實現時，向Vintagence支付總計人民幣20500萬(約合2,810美元萬)。截至2024年12月31日，我們已向Vintagence支付了440萬，其中包括與我們爲TERN-501提交的IND申請相關的里程碑式付款150萬，以及與2a階段DUET試驗開始劑量相關的里程碑式付款220萬。

我們擁有起訴轉讓專利的唯一責任和決策權。然而，如果我們拒絕支付任何轉讓專利的起訴費用，Vintagence有權起訴該轉讓專利。如果Vintagence接管該轉讓專利的起訴，我們必須將該轉讓專利轉讓回Vintagence。我們還擁有執行所轉讓專利和專有技術的優先權利（但沒有義務）。如果我們不採取任何措施針對任何侵權第三方執行任何轉讓的專利或專有技術，Vintagence有權採取任何必要行動來消除此類侵權。

轉讓協議將逐個國家繼續執行，直到我們支付所有里程碑付款。我們可以提前60天書面通知，無故終止全部轉讓協議，也可以逐個承保產品和逐個國家終止轉讓協議。任何一方均可因另一方重大違約行爲在90天內仍未得到解決，或因另一方破產、無力償債或爲債權人的利益做出類似安排而終止轉讓協議。如果我們無故終止轉讓協議，或者Vintagence因我們未解決的重大違約行爲終止轉讓協議，我們必須將轉讓的知識產權轉讓回Vintagence。

其中，FDA、歐盟委員會、美國衛生與公衆服務部監察長辦公室、醫療保險和醫療補助服務中心(CMS)以及州和地方司法管轄區以及其他國家和地區的類似監管機構對參與我們正在開發的藥物的臨牀開發、製造、營銷和分銷的公司提出了大量繁重的要求。這些機構和其他聯邦、州和地方實體對我們的候選產品的研發、測試、製造、質量控制、安全、有效性、標籤、儲存、記錄保存、批准、廣告和促銷、分銷、批准後監測和報告、抽樣和進出口等方面進行監管。我們開發的任何候選藥物在美國合法上市之前都必須得到FDA的批准，在這些國家合法上市之前必須得到適當的外國監管機構的批准。一般來說，我們在其他國家的活動將受到與美國類似的性質和範圍的監管，儘管可能存在重要的差異。此外，歐洲聯盟或歐盟的監管的一些重要方面是集中處理的，但針對具體國家的監管在許多方面仍然是必不可少的。

在美國，FDA根據聯邦《食品、藥物和化妝品法案》（FDCA）及其實施法規對藥物進行監管。

負責啓動和管理此類產品臨牀開發計劃的公司、機構或組織稱爲申辦者。尋求在美國上市和分銷新藥的申辦者通常必須確保以下條件：

在美國開始第一個候選產品的臨牀試驗之前，我們必須向FDA提交IND。IND是FDA授權對人類進行研究的新藥產品的請求。IND提交的中心焦點是臨牀研究的總體研究計劃和方案(S)。即使在IND提交之後，一些臨牀前試驗也可能繼續進行。IND還包括評估產品的毒理學、PKS、藥理學和PD特性的動物和體外研究的結果；化學、製造和控制信息；以及任何可用人類數據或文獻來支持研究產品的使用。這些研究通常被稱爲支持IND的研究。IND必須在人體臨牀試驗開始前生效。IND在FDA收到後30天自動生效，除非FDA在30天內對擬議的臨牀試驗提出安全擔憂或問題。在這種情況下，IND可能會被臨牀擱置，IND贊助商和FDA必須在臨牀試驗開始之前解決任何懸而未決的問題或問題。因此，提交IND可能會導致FDA授權開始臨牀試驗，也可能不會。

臨牀試驗涉及在合格研究者的監督下根據GCP向人類受試者給予研究產品，其中包括要求所有研究受試者提供參與任何臨牀研究的知情同意。臨牀試驗是根據詳細說明研究目標、用於監測安全性的參數以及待評估的有效性標準等方案進行的。必須爲產品開發期間進行的每次連續臨牀試驗以及任何後續方案修訂單獨提交現有IND。

此外，每個提議進行臨牀試驗的研究中心的獨立倫理委員會必須在該研究中心開始臨牀試驗之前審查和批准任何臨牀試驗的計劃及其知情同意書，並必須對研究進行監控直至完成。倫理委員會負責保護試驗參與者的福利和權利，並考慮參與臨牀試驗的個人的風險是否被最小化以及與預期收益相比是否合理等項目。倫理委員會還批准必須向每位臨牀試驗受試者或其法律代表提供的知情同意書，並且必須監測臨牀試驗直至完成。

監管機構、倫理委員會或申辦者可以隨時以各種理由暫停臨牀試驗，包括髮現受試者面臨不可接受的健康風險或試驗不太可能實現其既定目標。一些研究還包括由臨牀研究申辦者組織的獨立合格專家小組（稱爲數據監測委員會或DMC）的監督，該小組爲研究是否可以根據對研究的某些數據的訪問在指定檢查點繼續進行提供授權，並可以停止臨牀試驗如果確定受試者存在不可接受的安全風險或其他原因，例如沒有證明功效。

人體臨牀試驗通常分三個連續階段進行，這些階段可能重疊或合併：

批准後試驗，有時稱爲4期研究，可能會在初步上市批准後進行。這些試驗用於從預期治療適應症患者的治療中獲得額外經驗。在某些情況下，例如對於加速批准的藥物，FDA可能會強制執行第四期試驗。在某些情況下，FDA可能會強制執行第四期臨牀試驗作爲批准NDA的條件。

2022年12月，隨着食品和藥物綜合改革法案(FDORA)的通過，國會要求贊助商爲每一項新藥或生物製品的第三階段臨牀試驗或任何其他「關鍵研究」制定並提交一份多樣性行動計劃(DAP)。這些計劃旨在鼓勵更多不同的患者群體參加FDA監管產品的後期臨牀試驗。具體地說，行動計劃必須包括贊助商的招生目標、這些目標的基本原理以及贊助商打算如何實現這些目標的解釋。除了這些要求外，該立法還指示FDA發佈關於DAP的新指南。2024年6月，根據FDORA的授權，FDA發佈了指南草案，概述了DAP的一般要求。與FDA發佈的大多數指導文件不同，DAP指南在最終定稿時將具有法律效力，因爲FDORA明確規定了FDA指南中明確規定了提交DAP的形式和方式。2025年1月27日，作爲對總裁·特朗普發佈的關於多樣性、公平和包容性計劃的行政命令的回應，FDA從其網站上刪除了這一指導草案。

在新藥開發期間，贊助商有機會在某些時候與FDA會面。這些要點可能在提交IND之前、在第二階段結束時以及在提交保密協議之前。可以要求在其他時間舉行會議。這些會議可以爲贊助商提供機會分享有關迄今收集的數據的信息，爲FDA提供建議，併爲贊助商和FDA就下一階段的開發達成一致。贊助商通常利用第二階段試驗結束時的會議討論第二階段臨牀結果，並提交他們認爲將支持新藥批准的關鍵第三階段臨牀試驗計劃。

在臨牀試驗的同時，公司通常會完成額外的動物研究，並且還必須開發有關藥物化學和物理特徵的額外信息，並根據GMP要求最終確定商業批量生產產品的工藝。生產工藝必須能夠一致地生產候選產品的優質批次，並且除其他外，製造商必須開發測試最終藥物的身份、強度、質量和純度的方法。此外，必須選擇和測試適當的包裝，並進行穩定性研究，以證明候選產品在其保質期內不會發生不可接受的變質。

雖然IND處於活躍狀態，但進展報告（包括年度開發安全和更新報告，或DURA）總結自上次進展報告以來進行的臨牀試驗和非臨牀研究的結果以及其他信息，必須至少每年向FDA提交，並且必須向FDA和研究人員提交書面IND安全性報告，以應對嚴重和非預期的疑似AE，其他研究的結果表明暴露於相同或類似藥物的人類存在重大風險，動物或體外測試的結果表明對人類存在重大風險，以及與方案或研究者手冊中列出的情況相比，嚴重疑似不良反應的發生率有臨牀意義的增加。

關於我們的臨牀開發計劃，我們可能會在美國以外的地點進行試驗。當一項國外臨牀研究是在IND申請下進行的，除非放棄，否則必須滿足所有IND要求。如果外國臨牀研究不是在IND申請下進行的，贊助商必須確保該研究符合FDA的某些法規要求，以便將該研究用作IND申請或上市批准申請的支持。具體地說，研究必須按照GCP進行，包括接受獨立倫理委員會或IEC的審查和批准，以及尋求和接受受試者的知情同意。GCP要求包括臨牀研究的倫理和數據完整性標準。FDA的規定旨在幫助確保對參加非IND外國臨牀研究的人類受試者的保護，以及結果數據的質量和完整性。它們還有助於確保非IND外國研究以與IND研究相媲美的方式進行。

臨牀試驗的贊助商必須在美國國立衛生研究院(NIH)維護的公共註冊中心(Clinicaltrials.gov)上註冊並披露某些臨牀試驗信息。特別是，作爲臨牀試驗註冊的一部分，與臨牀試驗的產品、患者群體、調查階段、研究地點和調查人員以及其他方面有關的信息被公開。儘管FDA歷來沒有強制執行這些報告要求，因爲衛生與公衆服務部(HHS)在發佈最終實施條例方面拖延了很長時間。截至2024年12月19日，FDA已經發佈了六份不符合要求的通知，從而表明政府願意開始對不符合要求的臨牀試驗贊助商執行這些要求。雖然這些違規通知不會導致民事罰款，但未能向臨牀試驗提交臨牀試驗信息是FDCA禁止的行爲，違規行爲持續每天可能面臨高達10,000美元的民事罰款。違反規定還可能導致禁令和/或刑事起訴或取消聯邦撥款資格。

根據2003年的《兒科研究公平法》，NDA或其附錄必須包含足以評估藥物產品在所有相關兒科亞群中聲稱的適應症的安全性和有效性的數據，並支持該產品對安全有效的每個兒科亞群的劑量和給藥。隨着2012年FDASIA的頒佈，贊助商還必須在贊助商提交所需評估或調查的日期之前提交兒科研究計劃(如果PREA要求)，並且不遲於第二階段會議結束日期後60個歷日或FDA與贊助商商定的其他時間。這些計劃必須包含擬議的一項或多項兒科研究的大綱，或贊助商計劃進行的研究，包括研究目標和設計、任何推遲或豁免請求，以及法規要求的其他信息。贊助商、FDA和FDA的內部審查委員會隨後必須審查提交的信息，相互協商，並就最終計劃達成一致。FDA或贊助商可以隨時要求對計劃進行修改。

FDA可以主動或應贊助商的要求，批准推遲提交部分或全部兒科數據，直到批准該產品用於成人，或完全或部分免除兒科數據要求。延期可能有幾個原因，包括髮現在兒科試驗完成之前，該產品或候選治療藥物已準備好在成人身上批准使用，或者需要在兒科試驗開始之前收集額外的安全性或有效性數據。根據2012年食品和藥物管理局安全與創新法案(FDASIA)，FDA必須向未能提交PREA要求的兒科評估、未能尋求或獲得延期或延期或未能請求批准所需兒科配方的贊助商發送PREA不合規信函。FDASIA進一步要求FDA公開發佈PREA不遵守函和贊助商的回應。

PREA不適用於任何已授予孤兒稱號的適應症的研究產品，儘管FDA已採取措施限制其認爲的PRA中這一法定豁免的濫用，宣佈不打算授予任何額外的孤兒藥物稱號，用於罕見的兒科亞群，否則是一種常見疾病。2023年5月，FDA發佈了新的指南草案，進一步描述了PREA下的兒科研究要求。FDA還保留了一份因兒科人群疾病患病率較低而免於PREA要求的疾病清單。

假設根據所有適用的法規要求成功完成所有必需的測試，產品開發、臨牀前和其他非臨牀研究和臨牀試驗的結果以及對製造過程的描述、對藥物化學進行的分析測試、建議的標籤和其他相關信息將作爲請求批准該產品上市的保密協議的一部分提交給FDA。數據可能來自公司贊助的臨牀試驗，旨在測試一種產品的安全性和有效性，或者來自許多替代來源，包括研究人員發起的研究。爲了支持上市批准，提交的數據必須在質量和數量上足夠，以確定研究藥物產品的安全性和有效性，使FDA滿意。提交保密協議需要支付大量的用戶申請費和計劃費；在某些有限的情況下，可以獲得此類費用的豁免。此外，對於被指定爲孤兒藥物的產品，不對NDA評估使用費，除非該產品還包括非孤兒適應症。

FDA在提交後的前60天內對所有NDA進行初步審查，然後接受它們提交，以確定它們是否足夠完整，可以進行實質性審查。FDA的法規規定，申請「在收到所有相關信息和數據之前，不得被視爲已提交」。如果FDA確定申請不符合該標準，它將向申請人發出拒絕備案（RTI）決定。FDA還可能要求提供更多信息，而不是接受NDA提交。在這種情況下，必須重新提交NDA以及附加信息。重新提交的申請在FDA接受提交之前還需要接受審查。

FDA審查NDA，以確定產品對其預期用途是否安全有效，以及其製造是否符合CGM，以確保和保存產品的身份、強度、質量和純度。根據目前有效的《處方藥用戶費用法案》（PDUFA）指南，FDA的目標是從標準NDA「提交」之日起十個月內，讓新的分子實體審查提交材料並採取行動。從向FDA提交NDA之日起，這項審查通常需要十二個月的時間，因爲在提交申請後，FDA有大約兩個月的時間做出「提交」決定。實際審查時間可能會長得多，具體取決於審查的複雜性、FDA要求提供的額外信息以及申辦者提交的額外信息。

FDA尋求滿足這些申請審查時間表，但其能力可能受到多種因素的影響，包括政府預算和資金水平、僱用和保留關鍵人員的能力以及法定、監管和政策變化。因此，近年來該機構的平均審查時間一直在波動。例如，在過去的十年裏，美國政府多次關門，包括FDA在內的某些監管機構不得不讓關鍵員工休假並停止關鍵活動，包括可能對IND和NDA進行審查。

FDA可以將新藥申請提交給諮詢委員會。諮詢委員會是一個由獨立專家組成的小組，包括臨牀醫生和其他科學專家，負責審查、評估申請是否應獲得批准以及在何種條件下獲得批准並提供建議。FDA不受諮詢委員會建議的約束，但在做出決定時會仔細考慮此類建議。

此外，FDA將審查申辦者與進行臨牀試驗以支持NDA的主要研究者的財務關係。根據主要研究者在申辦者中可能擁有的報酬水平和任何其他經濟利益，申辦者可能需要向FDA報告這些關係。然後，FDA將評估該財務關係，並確定其是否會造成利益衝突或以其他方式影響試驗的解釋或主要研究者臨牀試驗中心生成的數據的完整性。如果是這樣，FDA可能會排除臨牀試驗中心與確定試驗產品安全性和有效性相關的數據。

在批准NDA之前，FDA通常會檢查生產產品的一個或多個設施。除非FDA確定生產工藝和設施符合GMP並且足以確保產品在要求的規範範圍內一致生產，否則FDA不會批准申請。此外，在批准NDA之前，FDA通常會檢查一個或多個臨牀中心，以確保符合GCP。隨着FDORA的通過，國會明確允許檢查參與提交給FDA的臨牀和非臨牀研究的準備、進行或分析的設施以及持有研究記錄或參與研究過程的其他人員，從而明確了FDA進行檢查的權力。

FDA評估NDA後，將發佈批准信或完整回應信（RTL）。批准函授權該藥物的商業營銷，並附有特定適應症的處方信息。RTL表明申請的審查週期已完成，並且申請不會以當前形式獲得批准。RTL通常描述FDA確定的NDA中的具體缺陷，並且可能需要額外的臨牀數據，例如額外的臨牀試驗或與臨牀試驗、非臨牀研究或製造相關的其他重要且耗時的要求。如果發佈了RTL，申辦者必須重新提交NDA，解決信函中指出的所有缺陷，或者撤回申請。即使提交了此類數據和信息，FDA也可能會認爲NDA不符合批准標準。

如果一種產品獲得監管部門的批准，這種批准將被授予特定的適應症，並可能包含對該產品可能上市的指定用途的限制。例如，FDA可能會批准具有風險評估和緩解戰略(REMS)的NDA，以確保產品的好處大於其風險。REMS是一種安全策略，用於管理已知或潛在的與藥物相關的嚴重風險，並通過管理藥物的安全使用使患者能夠繼續獲得此類藥物，可能包括藥物指南、醫生溝通計劃或確保安全使用的要素，如受限分配方法、患者登記和其他風險最小化工具。FDA還可能以改變擬議的標籤或制定適當的控制和規範等爲條件進行批准。一旦獲得批准，如果沒有保持對上市前和上市後要求的遵守，或者如果產品進入市場後出現問題，FDA可能會撤回產品批准。FDA還可能要求進行一項或多項第四階段上市後研究和監測，以進一步評估和監測產品在商業化後的安全性和有效性，並可能根據這些上市後研究的結果限制產品的進一步銷售。此外，可能會建立新的政府要求，包括由新立法產生的要求，或者FDA的政策可能會改變，這可能會影響監管批准的時間表或以其他方式影響正在進行的開發計劃。

FDA有許多計劃旨在加快符合某些標準的產品的開發或審查。例如，如果新藥旨在治療嚴重或危及生命的疾病或狀況，並顯示出解決該疾病或狀況未得到滿足的醫療需求的潛力，則有資格獲得快速通道指定。快速通道指定適用於候選產品和正在研究的特定適應症的組合。Fast Track候選產品的贊助商在產品開發期間有機會與審查團隊進行更頻繁的互動，FDA可以在提交完整申請之前滾動考慮NDA的審查部分，如果贊助商提供了提交NDA部分的時間表，FDA同意接受NDA的部分並確定該時間表是可接受的，並且贊助商在提交NDA的第一部分時支付任何必要的用戶費用。

如果候選產品旨在單獨或與一種或多種其他產品組合治療嚴重或危及生命的疾病或病症，並且初步臨牀證據表明該產品可能在一個或多個具有臨牀意義的終點上表現出比現有療法有實質性改善，FDA還可以將該候選產品指定爲「突破性療法」。例如在臨牀開發早期觀察到的實質性治療效果。該指定包括所有快速通道計劃功能，以及早在第一階段就開始的更密集的FDA互動和指導，以及加快候選產品開發和審查的組織承諾，包括高級管理人員的參與。

提交給FDA批准的任何候選產品，包括具有快速通道指定或突破療法指定的產品，也可能有資格參加旨在加快開發和審查的其他類型的FDA計劃，例如優先審查和加速批准。如果候選產品有潛力在沒有令人滿意的替代療法的情況下提供安全有效的治療，或者與已上市的產品相比，在疾病的治療、診斷或預防方面有顯着改善，則候選產品的NDA有資格獲得優先審查。FDA將嘗試將額外資源用於評估指定進行優先審查的申請，以促進審查。FDA努力在提交日期後六個月內審查具有優先審查指定的申請，而根據其當前的PDUFA審查目標，審查新分子實體NDA需要十個月。

此外，候選產品可能有資格獲得加速審批。用於治療嚴重或危及生命的疾病或病症的藥物產品，在確定候選產品對合理地可能預測臨牀益處的替代終點，或對可比不可逆轉的發病率或死亡率更早地測量的臨牀終點，合理地很可能預測對不可逆轉的發病率或死亡率或其他臨牀益處的影響時，有資格獲得加速批准，同時考慮到病情的嚴重性、稀有性或流行率以及替代治療的可用性或缺乏。作爲批准的一項條件，FDA可以要求獲得加速批准的藥物的贊助商進行充分和良好控制的上市後臨牀試驗，以驗證和描述對不可逆轉的發病率或死亡率或其他臨牀終點的預期效果，並在加速批准之前開始此類研究，如果贊助商未能進行所需的上市後研究或如果此類研究未能驗證預期的臨牀益處，則可能需要加速停藥程序。此外，FDA目前要求將促銷材料的預先批准作爲加速批准的條件，這可能會對該產品的商業推出時間產生不利影響。

此外，隨着2022年12月FDORA的通過，國會修改了某些關於加快藥品和生物製品審批的條款。具體地說，新立法授權FDA要求贊助商在獲得加速批准之前進行驗證性臨牀試驗，並每六個月向FDA提交一次批准後研究的進展報告，直到研究完成。此外，FDORA建立了快速程序，授權FDA在滿足某些條件的情況下撤回加速批准，包括所需的驗證性研究未能驗證和描述預測的臨牀益處，或證據表明在使用條件下該產品不安全或有效。如果贊助商未能對該產品進行盡職調查所需的任何批准後研究，包括與「部長指定的條件」有關的研究，FDA也可以使用這種程序撤銷加速批准。

2023年3月，FDA發佈了指南草案，概述了其當前加速批准的思維和方法。儘管單組試驗通常用於支持加速批准，但隨機對照試驗是首選方法，因爲它提供了更穩健的評估，並允許與現有療法直接比較。隨後，2024年12月和2025年1月，FDA發佈了與加速批准相關的額外指南草案。這些指南描述了FDA對盡職調查進行確認性試驗意味着什麼的看法，以及該機構計劃如何解釋此類研究是否需要在批准時進行。雖然這些指南目前僅爲草案形式，即使最終確定後最終也不具有法律約束力，但申辦者通常會密切遵守FDA的指南，以確保其研究產品有資格獲得加速批准。

快速通道指定、突破性治療指定、優先審查和加速批准不會改變批准標準，但可能會加快開發或批准過程。即使候選產品符合其中一項或多項計劃的資格，FDA稍後也可能會決定該候選產品不再符合資格條件，或者決定不會縮短FDA審查或批准的時間。

根據FDA批准製造或分銷的任何產品均受FDA普遍和持續的監管，其中包括與記錄保存、不良事件報告、定期報告、產品抽樣和分銷以及產品的廣告和促銷有關的要求。在批准後，對批准的產品的大多數更改，如增加新的適應症或其他標籤聲明，都要經過FDA的事先審查和批准。對於任何上市的產品，也有持續的年度計劃費用。藥品製造商及其分包商必須向FDA和某些州機構登記他們的機構，並接受FDA和某些州機構的定期突擊檢查，以了解cGMP的合規性，這對我們和我們的第三方製造商施加了某些程序和文件要求。2022年12月頒佈的《預防大流行病法》澄清，即使一種藥物或生物在進口或提供進口到美國之前，在美國境外的另一家機構進行了進一步的製造、製備、繁殖、複合或加工，外國藥品製造機構也必須遵守註冊和上市要求。

製造工藝的變更受到嚴格監管，並且根據變更的重要性，可能需要事先獲得FDA批准才能實施。FDA法規還要求調查和糾正任何與GMP的偏差，並對我們和我們可能決定使用的任何第三方製造商施加報告要求。

因此，製造商必須繼續在生產和質量控制領域花費時間、金錢和精力，以保持對GMP和監管合規的其他方面的合規性。

如果未能保持對監管要求和標準的遵守，或者產品上市後出現問題，FDA可能會撤回批准。後來發現產品以前未知的問題，包括意外嚴重程度或頻率的不良事件，或製造過程中的不良事件，或未能遵守監管要求，可能會導致對已批准的標籤進行修改以添加新的安全信息;實施上市後研究或臨牀研究以評估新的安全風險;或實施分銷限制或REMS計劃下的其他限制。其他潛在後果包括：

FDA還可能要求進行上市後測試（稱爲第四階段測試）和監督，以監測已批准產品的效果。發現產品以前未知的問題或未遵守適用的FDA要求可能會產生負面後果，包括不利的宣傳、司法或行政執法、FDA的警告信、強制糾正廣告或與醫生的溝通以及民事或刑事處罰等。新發現或開發的安全性或有效性數據可能需要更改產品已批准的標籤，包括添加新的警告和禁忌症，還可能需要實施其他風險管理措施。

FDA密切監管藥品的營銷、標籤、廣告和促銷。公司只能根據已批准的標籤的規定做出與安全性和有效性、純度和效力有關的聲明。FDA和其他機構積極執行禁止推廣標籤外使用的法律和法規。不遵守這些要求可能會導致不利宣傳、警告信、糾正廣告以及潛在的民事和刑事處罰等。醫生可以根據其獨立的專業醫學判斷，將合法可用的產品處方用於產品標籤中未描述的用途，並且與我們測試並經FDA批准的用途不同。醫生可能認爲，對於不同情況下的許多患者來說，這種超說明書使用是最好的治療方法。FDA不規範醫生選擇治療的行爲。

在非常具體、狹隘的條件下，製造商可能允許就標籤外信息進行非促銷、非誤導性的溝通，例如分發科學或醫學期刊信息。此外，隨着2022年12月《批准前信息交換法案》（PIE法案）的通過，尚未批准的產品的贊助商可以主動向付款人傳達有關開發中產品的某些信息，以幫助加快患者在產品批准後的訪問速度。此前，此類溝通是FDA指導允許的，但新立法明確爲向付款人傳達有關開發中產品的某些信息的申辦者提供保護，包括已批准產品的未經批准的使用。

此外，2025年1月，FDA發佈了最終指南，概述了其管理向醫療保健提供者分發有關已批准產品未經批准使用的科學信息的政策。最終指南要求此類溝通必須真實、無誤導性且具有科學依據，幷包括醫療保健提供者解釋有關未經批准使用已批准產品的信息的優點和缺點以及有效性和實用性所需的所有信息。如果公司進行符合指南建議的此類溝通，FDA表示不會將此類溝通視爲非法推廣已批准產品新預期用途的證據。

如果一家公司被發現推廣標籤外用途，它可能會受到FDA、司法部或衛生與公衆服務部監察長辦公室以及州當局的不利公關以及行政和司法執法的影響。這可能會使公司受到一系列可能產生重大商業影響的處罰，包括民事和刑事罰款以及對公司促銷或分銷藥品方式進行實質性限制的協議。聯邦政府對涉嫌不當促銷的公司處以巨額民事和刑事罰款，並要求公司簽訂同意令或永久禁令，以改變或限制特定促銷行爲。

然而，FDA確實限制製造商就其產品標籤外使用主題進行溝通。聯邦政府對涉嫌不當宣傳標籤外使用的公司處以巨額民事和刑事罰款，並禁止公司進行標籤外宣傳。FDA和其他監管機構還要求公司簽訂同意令或永久禁令，根據這些禁令改變或限制指定的促銷行爲。然而，公司可能會分享與產品FDA批准的標籤一致的真實而非誤導性的信息。

此外，處方藥產品的分銷須遵守《處方藥營銷法》（PDMA），該法在聯邦層面規範藥品和藥品樣本的分銷，併爲各州藥品分銷商的註冊和監管制定了最低標準。PDMA和州法律都限制了處方藥產品樣品的分發，並提出了確保分發問責制的要求。

根據FDCA授權的監管排他性條款可能會推遲某些營銷申請的提交或批准。FDCA爲第一個獲得新化學實體NDA批准的申請者提供了五年的美國境內監管排他期。如果FDA以前沒有批准過任何其他含有相同活性部分的新藥，藥物是一種新的化學實體，活性部分是負責藥物物質作用的分子或離子。在排他期內，FDA可能不會批准或甚至接受另一家公司根據第505(B)(2)條或505(B)(2)條提交的另一種藥物基於相同活性部分提交的簡化新藥申請或ANDA或NDA供審查，無論該藥物是用於與原始創新藥物相同的適應症還是用於另一種適應症，如果申請人不擁有或沒有合法權利參考批准所需的所有數據。然而，如果申請包含創新者NDA持有者向FDA列出的專利之一的專利無效或未侵權證明，則可以在四年後提交申請。

FDCA也可以爲NDA提供三年的監管獨佔權，或者如果FDA認爲申請人進行或贊助的新臨牀研究（生物利用度研究除外）對於申請的批准至關重要，則對現有NDA提供三年的監管獨佔權，例如現有藥物的新適應症、劑量或強度。這一爲期三年的排他性僅涵蓋該藥物根據新的臨牀研究獲得批准的修改，並且不禁止FDA批准含有活性物質的藥物的ANDA或505（b）（2）NDA用於原始適應症或使用條件。五年和三年的獨家經營權不會延遲完整保密協議的提交或批准。然而，提交完整NDA的申請人需要進行或獲得任何臨牀前研究以及證明安全性和有效性所需的充分且控制良好的臨牀試驗的參考權。

In the United States, the Orphan Drug Act of 1983, as amended, provides incentives for the development of drugs for rare diseases or conditions that affect fewer than 200,000 people in the United States (or for which there is no reasonable expectation that the cost of developing and making available the drug in the United States for such disease or condition will be recovered from sales of the drug in the United States). Certain of the incentives turn on the drug first being designated as an orphan drug. To be eligible for designation as an orphan drug (Orphan Drug Designation), the drug must have the potential to treat such rare disease or condition as described above. In addition, the FDA must not have previously approved a drug considered the “same drug,” as defined in the FDA’s orphan drug regulations, for the same orphan-designated indication or the sponsor of the subsequent drug must provide a plausible hypothesis of clinical superiority over the previously approved same drug. Upon receipt of Orphan Drug Designation, the sponsor is eligible for tax credits of up to 25% for qualified clinical trial expenses and waiver of the Prescription Drug User Fee Act application fee. In addition, upon marketing approval, an orphan-designated drug could be eligible for seven years of market exclusivity if no drug considered the same drug was previously approved for the same orphan condition (or if the subsequent drug is demonstrated to be clinically superior to any such previously approved same drug). Such orphan drug exclusivity, if awarded, would only block the approval of any drug considered the same drug for the same orphan indication. Moreover, a subsequent same drug could break an approved drug’s orphan exclusivity through a demonstration of clinical superiority over the previously approved drug.

In September 2021, the Court of Appeals for the 11th Circuit, in Catalyst Pharms, Inc. v. Becerra, or Catalyst, held that, for the purpose of determining the scope of orphan drug exclusivity, the term “same disease or condition” in the statute means the designated “rare disease or condition” and could not be interpreted by the FDA to mean the “indication or use.” Thus, the court concluded, orphan drug exclusivity applies to the entire designated disease or condition rather than the approved “indication or use.” Although there have been legislative proposals to overrule this decision, they have not been enacted into law. On January 23, 2023, the FDA announced that, in matters beyond the scope of the Catalyst court order, the FDA will continue to apply its existing regulations tying orphan-drug exclusivity to the uses or indications for which the orphan drug is approved. More recently however, on February 14, 2025, a federal district court in Washington, DC fully embraced the reasoning of the Catalyst decision in another decision challenging the scope of orphan drug exclusivity. The implications of this decision, and its impact on the FDA’s implementation of the Orphan Drug Act, are unclear at this point.

Pediatric exclusivity is another type of non-patent exclusivity in the United States and, if granted, provides for the attachment of an additional six months of regulatory exclusivity to the term of any existing unexpired patent or regulatory exclusivity, including orphan drug exclusivity. This six-month exclusivity may be granted if an NDA sponsor submits pediatric data that fairly respond to a written request from the FDA for such data about the active moiety in the product. The data do not need to show the product to be effective in the pediatric population studied; rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the additional protection is granted. If reports of requested pediatric studies are submitted to and accepted by the FDA within the statutory time limits, whatever statutory or regulatory periods of exclusivity or patent protection cover the product are extended by six months. This is not a patent term extension, but it effectively extends the regulatory period during which the FDA cannot approve another application.

Our product candidates will be subject to similar laws and regulations imposed by jurisdictions outside of the United States, and, in particular, the EU which may include, for instance, applicable clinical trial, marketing authorization and post-marketing requirements, including safety surveillance, anti-fraud and abuse laws and implementation of corporate compliance programs and reporting of payments or other transfers of value to healthcare professionals. Whether or not we obtain FDA approval for a product, we would need to obtain the necessary approvals by the comparable foreign regulatory authorities before we can commence clinical trials or marketing of the product in foreign jurisdictions. The time required to obtain approval in other countries and jurisdictions might differ from and be longer than that required to obtain FDA approval. Regulatory approval in one country or jurisdiction does not ensure regulatory approval in another, but a failure or delay in obtaining regulatory approval in one country or jurisdiction may negatively impact the regulatory process in others.

Similar to the United States, the various phases of non-clinical and clinical research in the EU are subject to significant regulatory controls.

Non-clinical studies are performed to demonstrate the health or environmental safety of new biological substances. Non-clinical studies must be conducted in compliance with the principles of good laboratory practice, or GLP, as set forth in EU Directive 2004/10/EC. In particular, non-clinical studies, both in vitro and in vivo, must be planned, performed, monitored, recorded, reported and archived in accordance with the GLP principles, which define a set of rules and criteria for a quality system for the organizational process and the conditions for non-clinical studies. These GLP standards reflect the Organisation for Economic Co-operation and Development requirements.

Clinical trials of medicinal products in the EU must be conducted in accordance with EU and national regulations and the International Conference on Harmonisation, or ICH, guidelines on Good Clinical Practice, or GCP, as set out in EU Commission Implementing Regulation (EU) 2017/556, EU Regulation (EU) 2016/679, or GDPR, as well as the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki. If the sponsor of the clinical trial is not established within the EU, it must appoint an EU entity to act as its legal representative. 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. The EU Clinical Trials Regulation, or CTR, which was adopted in April 2014 and repeals the EU Clinical Trials Directive, or CTD, became applicable on January 31, 2022. Unlike directives, the CTR is directly applicable in all EU member states without the need for member states to further implement it into national law. The CTR notably harmonizes the assessment and supervision processes for clinical trials throughout the EU via a Clinical Trials Information System, which contains a centralized EU portal and database.

While the Clinical Trials Directive required a separate clinical trial application, or CTA, to be submitted in each member state, to both the competent national health authority and an independent ethics committee, much like the FDA and IRB respectively, the CTR introduces a centralized process and only requires the submission of a single application to all member states concerned. The CTR allows sponsors to make a single submission to both the competent authority and an ethics committee in each member state, leading to a single decision per member state. The CTA must include, among other things, a copy of the trial protocol and an investigational medicinal product dossier containing information about the manufacture and quality of the medicinal product under investigation. The assessment procedure of the CTA has been harmonized as well, including a joint assessment by all member states concerned, and a separate assessment by each member state with respect to specific requirements related to its own territory, including ethics rules. Each member state’s decision is communicated to the sponsor via the centralized EU portal. Once the CTA is approved, clinical study development may proceed.

The CTR foresees a three-year transition period. The extent to which ongoing and new clinical trials will be governed by the CTR varies. For clinical trials whose CTA was made under the Clinical Trials Directive before January 31, 2022, the Clinical Trials Directive will continue to apply on a transitional basis for three years. Additionally, sponsors were able to choose to submit a CTA under either the Clinical Trials Directive or the CTR until January 31, 2023 and, if authorized, those will be governed by the Clinical Trials Directive until January 31, 2025. Thereafter, all ongoing trials will become subject to the provisions of the CTR.

Parties conducting certain clinical trials must, as in the United States, post clinical trial information in the EU at the EudraCT website: https://eudract.ema.europa.eu.

Medicines used in clinical trials must be manufactured in accordance with good manufacturing practice, or GMP, as set out in EU Commission Delegated Regulation (EU) 2017/1569. Other national and EU-wide regulatory requirements may also apply.

In order to market our future product candidates in the EU and many other foreign jurisdictions, we must obtain separate regulatory approvals. More concretely, in the EU, medicinal product candidates can only be commercialized after obtaining a marketing authorization, or MA. To obtain regulatory approval of a product candidate 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. There are two types of MAs:

Under the above described procedures, before granting the MA, the EMA or the competent authorities of the EU member states make an assessment of the risk-benefit balance of the product on the basis of scientific criteria concerning its quality, safety and efficacy.

MAs have an initial duration of five years. After these five years, the authorization may be renewed for an unlimited period on the basis of a reevaluation of the risk-benefit balance.

The EMA has adaptive pathways programs which allow for early and progressive patient access to a medicine. The adaptive pathways concept is an approach to medicines approval that aims to improve patients’ access to medicines which have potential to address unmet medical needs. To achieve this goal, several approaches are envisaged: identifying small populations with severe disease where a medicine’s benefit-risk balance could be favorable; making more use of real-world data where appropriate to support clinical trial data; and involving health technology assessment bodies early in development to increase the chance that medicines will be recommended for payment and ultimately covered by national healthcare systems. The adaptive pathways concept applies primarily to treatments in areas of high medical need where it is difficult to collect data via traditional routes and where large clinical trials would unnecessarily expose patients who are unlikely to benefit from the medicine. The approach builds on regulatory processes already in place within the existing EU legal framework. These include: scientific advice; compassionate use; the conditional approval mechanism (for medicines addressing seriously debilitating or life-threatening diseases or rare diseases); patient registries and other pharmacovigilance tools that allow collection of real-life data and development of a risk-management plan for each medicine.

The adaptive pathways program does not change the standards for the evaluation of benefits and risks or the requirement to demonstrate a positive benefit-risk balance to obtain MA.

In July 2016, the EMA launched the PRIME scheme. PRIME is a voluntary scheme aimed at enhancing the EMA’s support for the development of medicines that target unmet medical needs. It is based on increased interaction and early dialogue with companies developing promising medicines, to optimize their product development plans and speed up their evaluation to help them reach patients earlier. Product developers that benefit from PRIME designation can expect to be eligible for accelerated assessment but this is however not guaranteed. The benefits of a PRIME designation include the appointment of a rapporteur from the Committee for Medicinal Product candidates for Human Use before submission of an MAA, early dialogue and scientific advice at key development milestones, and the potential to qualify product candidates for accelerated review earlier in the application process.

The EU also provides opportunities for market exclusivity. Upon receiving MA, or reference medicinal products qualify for eight years of data exclusivity and an additional two years of market exclusivity. If granted, the data exclusivity period prevents generic or biosimilar applicants from relying on the preclinical and clinical trial data contained in the dossier of the reference product when applying for a generic or biosimilar MA in the EU during a period of eight years from the date on which the reference product was first authorized in the EU. The market exclusivity period prevents a successful generic or biosimilar applicant from commercializing its product in the EU until 10 years have elapsed from the initial authorization of the reference product in the EU. The overall 10-year market exclusivity period can be extended to a maximum of eleven years if, during the first eight years of those 10 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 in comparison with existing therapies. However, there is no guarantee that a product will be considered by the EU’s regulatory authorities to be a new chemical entity, and products may not qualify for data exclusivity.

The EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020. The European Commission’s proposal for revision of several legislative instruments related to medicinal products (potentially reducing the duration of regulatory data protection and exclusivity periods for orphan drugs, revising the eligibility for expedited pathways, etc.) was published in April 2023. In April 2024, the European Parliament adopted a position on the proposal requesting several amendments to the package. The proposed revisions remain to be agreed and adopted by the European Parliament and European Council and the proposals may therefore be substantially revised before adoption, which is not anticipated before early 2026.

Similar to the United States, both MA holders and manufacturers of medicinal products are subject to comprehensive regulatory oversight by the EMA, the European Commission and/or the competent regulatory authorities of the member states. The holder of a MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance who is responsible for oversight of that system. Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports, or PSURs.

All new MAA must include a risk management plan, or RMP, describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated with the product. The regulatory authorities may also impose specific obligations as a condition of the MA. Such risk-minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies.

The advertising and promotion of medicinal products is also subject to laws concerning promotion of medicinal products, interactions with physicians, misleading and comparative advertising and unfair commercial practices. All advertising and promotional activities for the product must be consistent with the approved summary of product characteristics, and therefore all off-label promotion is prohibited. Direct-to-consumer advertising of prescription medicines is also prohibited in the EU. Although general requirements for advertising and promotion of medicinal products are established under EU directives, the details are governed by regulations in each member state and can differ from one country to another.

Failure to comply with the aforementioned EU and member state laws may result in administrative, civil or criminal penalties. These penalties could include delays or refusal to authorize the conduct of clinical trials, suspension of the conduct of clinical trials, rejection of clinical trial data, or refusal to grant MA, product withdrawals and recalls, product seizures, suspension, withdrawal, revocation or variation of the MA, total or partial suspension of production, distribution, manufacturing or clinical trials, operating restrictions, injunctions, suspension of licenses, fines and criminal penalties.

The aforementioned EU rules are generally applicable in the European Economic Area, or EEA, which consists of the 27 EU member states plus Norway, Liechtenstein and Iceland.

The UK’s withdrawal from the EU, commonly referred to as Brexit, took place on January 31, 2020. The EU and the UK reached an agreement on their new partnership in the Trade and Cooperation Agreement, which entered into force on May 1, 2021. As of January 1, 2021, the Medicines and Healthcare Products Regulatory Agency (the MHRA) became responsible for supervising medicines and medical devices in Great Britain, comprising England, Scotland and Wales under domestic law, whereas Northern Ireland continues to be subject to EU rules under the Northern Ireland Protocol, as amended by the so called Windsor Framework agreed in February 2023. As of January 1, 2025, the changes introduced by the Windsor Framework resulted in the MHRA being responsible for approving all medicinal products destined for the United Kingdom market (Great Britain and Northern Ireland), and the EMA will no longer have any role in approving medicinal products destined for Northern Ireland. The MHRA relies on the Human Medicines Regulations 2012 (SI 2012/1916) (as amended) (the HMR) as the basis for regulating medicines. The HMR has incorporated into the domestic law the body of EU law instruments governing medicinal products that pre-existed prior to the UK’s withdrawal from the EU.

As of January 1, 2024 on, a new international recognition procedure (IRP) applies which intends to facilitate approval of pharmaceutical products in the UK. The IRP is open to applicants that have already received an authorization for the same product from one of the MHRA’s specified Reference Regulators (RRs). The RRs notably include EMA and regulators in the EEA member states for approvals in the EU centralized procedure and mutual recognition procedure as well as the FDA (for product approvals granted in the U.S.).The RR assessment must have undergone a full and standalone review. RR assessments based on reliance or recognition cannot be used to support an IRP application. A CHMP positive opinion or an MRDC positive end of procedure outcome is an RR authorization for the purposes of IRP.

Pharmaceutical companies are subject to additional healthcare regulation and enforcement by the federal government and by authorities in the states and foreign jurisdictions in which they conduct their business. Such laws include, without limitation, state and federal anti-kickback, fraud and abuse, false claims and transparency laws and regulations with respect to drug pricing and payments or other transfers of value made to physicians and other healthcare professionals. If their operations are found to be in violation of any of such laws or any other governmental regulations that apply, they may be subject to penalties, including, without limitation, administrative, civil and criminal penalties, damages, fines, integrity oversight and reporting obligations, the curtailment or restructuring of operations, exclusion from participation in federal and state healthcare programs and individual imprisonment.

Sales of any product depend, in part, on the extent to which such product will be covered by third-party payors, such as federal, state and foreign government healthcare programs, commercial insurance and managed healthcare organizations and the level of reimbursement for such product by third-party payors. Decisions regarding the extent of coverage and amount of reimbursement to be provided are made on a plan-by-plan basis. These third-party payors are increasingly reducing reimbursements for medical products, drugs and services. In addition, the U.S. government, state legislatures and foreign governments have continued implementing cost-containment programs, including price controls, restrictions on coverage and reimbursement and requirements for substitution of generic products. Adoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls, inflationary rebates and measures, could further limit sales of any product. Decreases in third-party reimbursement for any product or a decision by a third-party payor not to cover a product could reduce physician usage and patient demand for the product and also have a material adverse effect on sales.

Outside of the United States, the pricing of pharmaceutical products is subject to governmental control in many countries. In the EU, pricing and reimbursement schemes vary widely from country to country. Some countries provide that products may be marketed only after a reimbursement price has been agreed. Some countries may require the completion of additional studies that compare the cost effectiveness of a particular therapy to currently available therapies or so-called health technology assessments, in order to obtain reimbursement or pricing approval. Other countries may allow companies to fix their own prices for products, but monitor and control product volumes and issue guidance to physicians to limit prescriptions. Efforts to control prices and utilization of pharmaceutical products and medical devices will likely continue as countries attempt to manage healthcare expenditures. Historically, products launched in the EU do not follow price structures of the United States and generally prices tend to be significantly lower.

The Medicaid Drug Rebate Program, the 340B drug pricing program, the U.S. Department of Veterans Affairs Federal Supply Schedule program, and other governmental drug pricing programs require participating manufacturers to report certain product and pricing data to the government. Pricing calculations vary among products and programs, are complex, and are often subject to interpretation by manufacturers, governmental or regulatory agencies and the courts, which can change and evolve over time. Manufacturers may be held liable for errors associated with submission of data under these programs, including potential civil monetary penalties per item of falsely reported or misrepresented drug pricing information. Such failure also could be grounds for other sanctions, such as termination from the Medicaid Drug Rebate Program. Further, a growing number of states have enacted drug price transparency laws requiring pharmaceutical manufacturers to report information to certain state agencies and other parties. Many of these laws provide for civil monetary penalties and other enforcement mechanisms if manufacturers are found to have violated requirements.

In the United States and certain foreign jurisdictions, there have been a number of legislative and regulatory changes to the healthcare system. In March 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively, the ACA, was signed into law, which substantially changed the way healthcare is financed by both governmental and private insurers in the United States. By way of example, the ACA increased the minimum level of Medicaid rebates payable by manufacturers of brand name drugs from 15.1% to 23.1%; required collection of rebates for drugs paid by Medicaid managed care organizations; imposed a non-deductible annual fee on pharmaceutical manufacturers or importers who sell certain “branded prescription drugs” to specified federal government programs, implemented 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; expanded eligibility criteria for Medicaid programs; creates 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 established a Center for Medicare Innovation at 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, executive and Congressional challenges to certain aspects of the ACA, and we expect there will be additional challenges and amendments to the ACA in the future. For example, the ACA has been challenged at the U.S. Supreme Court multiple times since its enactment. While in 2021, the U.S. Supreme Court dismissed a judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA.

During the first Trump Administration, the Congress and administration sought to overturn the ACA and related measures. Shortly after taking office in January 2025, President Trump revoked numerous executive orders issued by President Biden, including at least two executive orders (EO 14009, Strengthening Medicaid and the Affordable Care Act, and EO 14070, Continuing to Strengthen Americans’ Access to Affordable, Quality Health Coverage) which were designed to further implement the ACA. We anticipate similar efforts to undermine the ACA, and the accompanying uncertainty, for the foreseeable future.

In addition, other legislative changes have been proposed and adopted since the ACA was enacted, including aggregate reductions of Medicare payments to providers of 2% per fiscal year, which will remain in effect through 2032 absent additional congressional action. Additionally, under the Statutory Pay-As-You-Go Act of 2010 (Statutory PAYGO), the Administration is required to issue a sequestration order (capped at 4% for Medicare payments) if the PAYGO scorecard shows a net cost at the end of a Congressional session. Although Statutory PAYGO was expected to be triggered at the end of the 2021 Congressional session, subsequent legislation has delayed a Statutory PAYGO sequestration order until after 2024. Moreover, there has recently been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and proposed and enacted legislation designed, among other things, to bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs and reform government program reimbursement methodologies for pharmaceutical products.

For example, in August 2022, the Inflation Reduction Act, or IRA, was enacted. The new legislation has implications for Medicare Part D, which is a program available to individuals who are entitled to Medicare Part A or enrolled in Medicare Part B to give them the option of paying a monthly premium for outpatient prescription drug coverage. 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). The IRA permits the Secretary of the Department of Health and Human Services (HHS) to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

Specifically, with respect to price negotiations, Congress authorized Medicare to negotiate lower prices for certain costly single-source drug and biologic products that do not have competing generics or biosimilars and are reimbursed under Medicare Part B and Part D. CMS may negotiate prices for ten high-cost drugs paid for by Medicare Part D starting in 2026, followed by 15 Part D drugs in 2027, 15 Part B or Part D drugs in 2028, and 20 Part B or Part D drugs in 2029 and beyond. This provision applies to drug products that have been approved for at least 9 years and biologics that have been licensed for 13 years, but it does not apply to drugs and biologics that have been approved for a single rare disease or condition. Further, the legislation subjects drug manufacturers to civil monetary penalties and a potential excise tax for failing to comply with the legislation by offering a price that is not equal to or less than the negotiated “maximum fair price” under the law or for taking price increases that exceed inflation.

The first cycle of negotiations for the Medicare Drug Price Negotiation Program commenced in the summer of 2023. In August 2024, the HHS published the results of the first Medicare drug price negotiations for ten selected drugs that treat a range of conditions, including diabetes, chronic kidney disease, and rheumatoid arthritis. The prices of these ten drugs will become effective January 1, 2026. On January 17, 2025, CMS announced its selection of 15 additional drugs covered by Part D for the second cycle of negotiations. Thereafter, following the change in administrations, CMS issued a public statement on January 29, 2025, declaring that lowering the cost of prescription drugs is a top priority of the new administration and CMS is committed to considering opportunities to bring greater transparency in the negotiation program. The second cycle of negotiations with participating drug companies will occur during 2025, and any negotiated prices for this second set of drugs will be effective starting January 1, 2027.

In addition to the drug price negotiation program, the IRA established inflation rebate programs under Medicare Part B and Part D. These programs require manufacturers to pay rebates to Medicare if they raise their prices for certain Part B and Part D drugs faster than the rate of inflation. In December 2024, with issuance of its 2025 Physician Fee Schedule final regulation, CMS finalized its rules governing the IRA inflation rebate programs. The new law also capped Medicare out-of-pocket drug costs at an estimated $4,000 a year in 2024 and, thereafter beginning in 2025, at 2,000 a year.

In June 2023, Merck filed a lawsuit against HHS and CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution. Subsequently, a number of other parties, including the U.S. Chamber of Commerce, or Chamber, Bristol Myers Squibb Company, the Pharmaceutical Research and Manufacturers of America, Astellas, Novo Nordisk, Janssen Pharmaceuticals, Novartis, AstraZeneca and Boehringer Ingelheim, also filed lawsuits in various courts with similar constitutional claims against HHS and CMS. HHS has generally won the substantive disputes in these cases, and various federal district court judges have expressed skepticism regarding the merits of the legal arguments being pursued by the pharmaceutical industry. Certain of these cases are now on appeal and, on October 30, 2024, the Court of Appeals for the Third Circuit heard oral argument in three of these cases. Litigation involving these and other provisions of the IRA will continue with unpredictable and uncertain results.

In addition, individual states in the United States have also become increasingly active in implementing regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, marketing cost disclosure and other transparency measures and, in some cases, mechanisms to encourage importation from other countries and bulk purchasing. Furthermore, there has been increased interest by third party payors and governmental authorities in reference pricing systems and publication of discounts and list prices. This may be increasingly true with respect to products approved pursuant to the accelerated approval pathway. State Medicaid programs and other payers are developing strategies and implementing significant coverage barriers, or refusing to cover these products outright, arguing that accelerated approval drugs have insufficient or limited evidence despite meeting the FDA’s standards for accelerated approval.

Numerous state, federal and foreign laws govern the collection, dissemination, use, access to, confidentiality and security of health-related information. In the United States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy laws and federal and state consumer protection laws and regulations (e.g., Section 5 of the Federal Trade Commission Act, or FTC Act), govern the collection, use, disclosure and protection of health-related and other personal information, and could apply to our operations or the operations of our partners. The FTC has been particularly focused on the unpermitted processing of health data through its recent enforcement actions and is expanding the types of privacy violations that it interprets to be “unfair” under Section 5 of the FTC Act, The agency is also in the process of developing rules related to commercial surveillance and data security. We will need to account for the FTC’s evolving rules and guidance for proper privacy and data security practices in order to mitigate risk for a potential enforcement action, which may be costly. The FTC’s enforcement priorities (as well as those of other federal regulators) may be impacted by the change in administration and new leadership. These shifts in enforcement priorities may also impact our business.

There are also increased restrictions at the federal level relating to transferring sensitive data outside of the United States to certain foreign countries. For example, in 2024, Congress passed H.B. 815, which included the Protecting Americans’ Data from Foreign Adversaries Act of 2024. This law creates certain restrictions for entities that disclose sensitive data (including potential health data) to countries such as China. Failure to comply with these rules can lead to a potential FTC enforcement action. Additionally, the Department of Justice recently finalized a rule implementing Executive Order 14117, which creates similar restrictions related to the transfer of sensitive US data to countries such as China. These data transfer restrictions (and others that may pass in the future) may create operational challenges and legal risks for our business.

At the state level, 19 states to date have enacted omnibus consumer privacy laws, each of which provides special provisions regarding the privacy of health-related information, and each of which provides for civil enforcement, including the levying of fines for violations. Moreover, the California Privacy Rights Act (CPRA) imposes consumer privacy obligations on businesses with respect to their California-based employees and business contacts. Additionally, California’s Confidentiality of Medical Information Act (H. R. 8152)—which provides for both civil enforcement and a private right of action—imposes specific obligations on pharmaceutical companies with respect to the privacy of medical information. The state of Washington also passed the My Health My Data Act in 2023, which specifically regulates health information and includes a private right action (and has inspired copycat legislation by other states). Each of these state laws could apply to our operations or the operations of our partners. We note, too, that Congress may also consider federal privacy legislation, which may meaningfully impact our compliance obligations.

In addition, certain foreign laws govern the privacy and security of personal data, including health-related data. For example, the GDPR imposes strict requirements for processing the personal data of individuals within the EEA. Companies that must comply with the GDPR face increased compliance obligations and risk, including more robust regulatory enforcement of data protection requirements and potential fines for noncompliance of up to €20 million or 4% of the annual global revenues of the noncompliant company, whichever is greater. Further, from January 1, 2021, companies have had to comply with the GDPR and also the UK GDPR, which, together with the amended UK Data Protection Act 2018, retains the GDPR in UK national law. The UK GDPR mirrors the fines under the GDPR, i.e., fines up to the greater of €20 million (£17.5 million) or 4% of global turnover. Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions on data processing. The GDPR prohibits the transfer of personal data from the European Economic Area, or EEA, to countries outside of the EEA unless made to a country deemed to have adequate data privacy laws by the European Commission or a data transfer mechanism has been put in place. The EU-US Privacy Shield was such a transfer mechanism put in place by the EU and the United States, but the Privacy Shield was invalidated for international transfers of personal data in July 2020 by the Court of Justice of the EU, or CJEU. In October 2022, President Biden signed an executive order to implement the EU-U.S. Data Privacy Framework (DPF), which is intended to be a replacement for the EU-US Privacy Shield. The European Commission adopted an adequacy decision to permit data transfers from the EEA to the United States going forward. This development permits data transfers at this point under this framework and more broadly has made international data transfers more straightforward, but these provisions are being challenged in court. The recent election in the United States and the new administration may also impact whether the DPF remains an adequate data transfer framework. The continuing uncertainty around this issue may further impact our business operations in the EEA.

There is also uncertainty about other data transfer mechanisms. In June 2021, the European Commission adopted new standard contractual clauses (SCCs) that are designed to be a mechanism by which entities can transfer personal information out of the EEA to jurisdictions that the European Commission has not found to provide an adequate level of protection. The SCCs require parties that rely upon that legal mechanism to comply with additional obligations, such as conducting transfer impact assessments to determine whether additional security measures are necessary to protect the transferred personal information. The competent authorities and courts in a number of EU Member States increasingly scrutinize and question the GDPR compliance of processing of personal data by US-based entities or entities with links to US-based entities, independently of whether personal data is actually transferred outside the EEA. In June 2021, the CJEU issued a ruling that expanded the scope of the “one stop shop” under the GDPR. According to the ruling, the competent authorities of EU Member States may, under certain strict conditions, bring claims to their national courts against a company for breaches of the GDPR, including unlawful cross-border processing activities, even such company does not have an establishment in the EU member state in question and the competent authority bringing the claim is not the lead supervisory authority.

As of December 31, 2024, we had 59 employees, all of whom were full-time, all of whom are engaged in research and development activities, operations, finance, or administration. 13 of our employees hold doctorate degrees (Ph.D., M.D. or Pharm.D.). None of our employees are subject to a collective bargaining agreement. We consider our relationship with our employees to be good.

Our key human capital management objectives include, among others: (i) attracting, developing and retaining a diverse and talented workforce; (ii) providing opportunities for learning, development, career growth and movement within our company; (iii) evaluating compensation and benefits and rewarding performance; (iv) investing in physical, emotional and financial health of team members; (v) obtaining team member feedback; (vi) maintaining and enhancing our culture and mission; and (vii) communicating with our board of directors on a routine basis on key topics. We have implemented and continue to develop many programs designed to achieve these priorities.

We were incorporated under the laws of the Cayman Islands on December 9, 2016. On December 29, 2020, we effected a de-registration under the Cayman Islands Companies Law (2020 Revision) and a domestication under Section 388 of the Delaware General Corporation Law, pursuant to which our jurisdiction of incorporation was changed from the Cayman Islands to the State of Delaware. Our principal executive offices are located at 1065 East Hillsdale Boulevard, Suite 100, Foster City, California 94404, and our telephone number is (650) 525-5535.

Our website address is www.ternspharma.com. We make available on or through our website certain reports and amendments to those reports that we file with or furnish to the Securities and Exchange Commission (SEC) in accordance with the Securities Exchange Act of 1934, as amended, or the Exchange Act. These include our annual reports on Form 10-K, our quarterly reports on Form 10-Q, and our current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act. We make this information available on or through our website free of charge as soon as reasonably practicable after we electronically file the information with, or furnish it to, the SEC. References to our website address do not constitute incorporation by reference of the information contained on the website, and the information contained on the website is not part of this document or any other document that we file with or furnish to the SEC. The SEC maintains a site on the worldwide web that contains reports, proxy and information statements and other information regarding our filings at www.sec.gov.

Investing in our common stock involves a high degree of risk. You should carefully consider the risks described below, as well as the other information in this Annual Report on Form 10-K, including our consolidated financial statements and the related notes and Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” before deciding whether to invest in our common stock. The occurrence of any of the events or developments described below could materially and adversely affect our business, financial condition, results of operations and prospects. In such an event, the market price of our common stock could decline and you may lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations and the market value of our common stock. You should consider all of the risk factors described when evaluating our business.

Risks Related to Our Limited Operating History, Financial Condition and Capital Requirements

We are a clinical-stage biopharmaceutical company with a limited operating history and no products approved for commercial sale. We have incurred significant losses since our inception, and we anticipate that we will continue to incur significant losses for the foreseeable future, which, together with our limited operating history, makes it difficult to assess our future viability.

We are a clinical-stage biopharmaceutical company, and we have only a limited operating history upon which you can evaluate our business and prospects. Biopharmaceutical product development is a highly speculative undertaking and involves a substantial degree of risk. We have no products approved for commercial sale and have not generated any revenue from sales of our product candidates and have incurred losses in each year since our inception in December 2016. We have only a limited operating history upon which you can evaluate our business and prospects. In addition, we have not yet demonstrated an ability to successfully overcome many of the risks and uncertainties frequently encountered by companies in new and rapidly evolving fields, particularly in the pharmaceutical, biopharmaceutical and biotechnology industry. We expect that it will be a number of years, if ever, before we have a product candidate ready for commercialization.

We have had significant operating losses since our inception. Our net loss attributable to common stockholders for the years ended December 31, 2024 and 2023 was approximately $88.9 million and $90.2 million, respectively. As of December 31, 2024, we had an accumulated deficit of $421.5 million. Substantially all of our losses have resulted from expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations. We expect to continue to incur losses for the foreseeable future, and we anticipate these losses will increase as we continue to develop our product candidates, conduct clinical trials and pursue research and development activities. Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods. Our prior losses, combined with expected future losses, have had and will continue to have an adverse effect on our stockholders’ equity and working capital.

We will require substantial additional funding to finance our operations and achieve our goals. Failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product development programs, commercialization efforts or other operations.

Since our inception, we have invested a significant portion of our efforts and financial resources in research and development activities. Our product candidates will require additional clinical development, and we intend to conduct additional research and development activities to discover and develop new product candidates, including conducting preclinical studies and clinical trials, all of which will require substantial additional funds. We will continue to expend significant resources for the foreseeable future in connection with these activities. These expenditures will include costs associated with conducting preclinical studies and clinical trials, obtaining regulatory approvals and manufacturing and supply, as well as marketing and selling any drugs approved for sale. In addition, other unanticipated costs may arise. Because the outcome of any preclinical study or clinical trial is highly uncertain, we cannot reasonably estimate the actual amounts necessary to successfully complete the development and commercialization of our product candidates or any future product candidates.

As of December 31, 2024, we had capital resources consisting of cash, cash equivalents and marketable securities of approximately $358.2 million. We expect our existing capital resources will fund our planned operating expenses into 2028. However, our operating plans may change as a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned through public or private equity offerings or debt financings or other sources, such as strategic collaborations. Such financing may result in dilution to our stockholders, and may also result in imposition of burdensome debt covenants and repayment obligations, or other restrictions that may affect our business. In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans.

Additional funds may not be available when we need them, on terms that are acceptable to us, or at all. If adequate funds are not available to us on a timely basis, we may be required to:

We also could be required to seek funds through arrangements with collaborators or others that may require us to relinquish rights to some of our technologies or product candidates that we would otherwise pursue on our own. We do not expect to realize revenue from sales of products or royalties from licensed products in the foreseeable future, if at all, and unless and until our product candidates are clinically tested, approved for commercialization and successfully marketed. To date, we have primarily financed our operations through the sale of equity and debt securities. We may be required to seek additional funding in the future and currently intend to do so through public or private equity offerings or debt financings, credit or loan facilities, collaborations or a combination of one or more of these funding sources. Our ability to raise additional funds will depend on financial, economic and other factors, many of which are beyond our control. Additional funds may not be available to us on acceptable terms or at all. If we raise additional funds by issuing equity securities, our stockholders will suffer dilution and the terms of any financing may adversely affect the rights of our stockholders. In addition, as a condition to providing additional funds to us, future investors may demand, and may be granted, rights superior to those of existing stockholders or the holders of any future security we may issue. Debt financing, if available, is likely to involve restrictive covenants limiting our flexibility in conducting future business activities, and, in the event of insolvency, debt holders would be repaid before holders of our equity securities received any distribution of our corporate assets.

Due to the significant resources required for the development of our product candidates, we must prioritize development of certain product candidates and/or certain disease indications, with our current clinical-stage drug candidates focused on CML and obesity. We may expend our limited resources on candidates or indications that do not yield a successful product and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success.

Our programs are focused on developing a portfolio of small-molecule product candidates for the treatment of chronic myeloid leukemia, or CML, and obesity. We seek to maintain a process of prioritization and resource allocation among our programs to maintain a balance between progressing our current clinical programs, TERN-701 for CML and TERN-601 for obesity, as well as advancing our earlier stage preclinical programs, including the TERN-800 series for obesity, and developing future product candidates. We may also consider whether to conduct combination trials of our single-agent drug candidates. However, due to the significant resources required for the development of our product candidates, we must focus on specific diseases and disease pathways and decide which product candidates to pursue and the amount of resources to allocate to each product candidate.

Our decisions concerning the allocation of research, development, collaboration, management and financial resources toward product candidates or therapeutic areas may not lead to the development of any viable commercial drug and may divert resources away from better opportunities. We may fail to capitalize on viable commercial products or profitable market opportunities, be required to forego or delay pursuit of opportunities with other product candidates or other diseases and disease pathways that may later prove to have greater commercial potential than those we choose to pursue, or relinquish valuable rights to such product candidates through collaboration, licensing or other royalty arrangements in cases in which it would have been advantageous for us to invest additional resources to retain development and commercialization rights.

Similarly, any decision to delay, terminate or collaborate with third parties in respect of certain programs may subsequently also prove to be suboptimal and could cause us to miss valuable opportunities. If we make incorrect determinations regarding the viability or market potential of any of our programs or product candidates or misinterpret trends in CML, obesity, or other indications or in the pharmaceutical, biopharmaceutical or biotechnology industry, our business, financial condition and results of operations could be materially adversely affected.

We are early in our development efforts. Our business is heavily dependent on the successful development, regulatory approval and commercialization of our current and future product candidates.

We have no drugs approved for sale, and our most advanced development programs are in early stages of clinical development. The success of our business, including our ability to finance our company and generate revenue in the future, will primarily depend on the successful development, regulatory approval and commercialization of our product candidates and, in particular, progressing our most advanced development programs. Given our stage of development, it may be many years, if we succeed at all, before we have demonstrated the safety and efficacy of a product candidate sufficient to warrant approval for commercialization. We cannot be certain that our product candidates will receive regulatory approval or be successfully commercialized even if we receive regulatory approval.

We have not previously submitted a new drug application, or NDA, to the U.S. Food and Drug Administration, or FDA, or similar approval filings to a comparable foreign regulatory authority, for any product candidate. An NDA or other relevant regulatory filing must include extensive preclinical and clinical data and supporting information to establish that the product candidate is safe and effective for each desired indication. The NDA or other relevant regulatory filing must also include significant information regarding the chemistry, manufacturing and controls for the product. We cannot be certain that our current or future product candidates will be successful in clinical trials or receive regulatory approval. Further, even if they are successful in clinical trials, our current or future product candidates may not receive regulatory approval. If we do not receive regulatory approvals for current or future product candidates, we may not be able to continue our operations. Even if we successfully obtain regulatory approval to market a product candidate, our revenue will depend, in part, upon the size of the markets in the territories for which we gain regulatory approval and have commercial rights, as well as the availability of competitive products, whether there is sufficient third-party reimbursement and adoption by physicians. We may plan to seek regulatory approval to commercialize our product candidates in the United States and in select foreign countries. While the scope of regulatory approval generally is similar in other countries, in order to obtain separate regulatory approval in other countries, we must comply with numerous and varying regulatory requirements of such countries regarding safety and efficacy. Other countries also have their own regulations governing, among other things, clinical trials and commercial sales, as well as pricing and distribution of drugs, and we may be required to expend significant resources to obtain regulatory approval and to comply with ongoing regulations in these jurisdictions. In the future, we may also become dependent on other product candidates that we may develop or acquire. The clinical and commercial success of our product candidates and future product candidates will depend on a number of factors, including the following:

These factors, many of which are beyond our control, could cause us to experience significant delays or an inability to obtain regulatory approvals or commercialize our product candidates. Even if regulatory approvals are obtained, we may never be able to successfully commercialize any of our product candidates. Accordingly, we cannot provide assurances that we will be able to generate sufficient revenue through the sale of our product candidates or any future product candidates to continue our business or achieve profitability.

Clinical drug development involves a lengthy and expensive process with uncertain timelines and outcomes, and results of earlier studies and trials may not be predictive of future trial results. If development of our product candidates is unsuccessful or delayed, we may be unable to obtain required regulatory approvals and we may be unable to commercialize our product candidates on a timely basis, if at all.

Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain. Failure or delay can occur at any time during the clinical trial process. Success in nonclinical testing and early clinical trials does not ensure that later clinical trials will be successful. A number of companies in the pharmaceutical industry, including biotechnology companies, have suffered significant setbacks in clinical trials, even after promising results in earlier nonclinical or clinical studies. These setbacks have been caused by, among other things, nonclinical findings made while clinical studies were underway and safety or efficacy observations made in clinical studies, including previously unreported AEs. The results of preclinical, nonclinical and early clinical studies of our product candidates may not be predictive of the results of later-stage clinical trials. Likewise, interim or preliminary results from a clinical trial may not be predictive of final results. Product candidates in later stages of clinical trials may fail to show the desired safety and efficacy traits despite having progressed through preclinical and initial clinical trials. Notwithstanding any potential promising results in earlier studies, we cannot be certain that we will not face similar setbacks. Even if our clinical trials are completed, the results may not be sufficient to obtain regulatory approval for our product candidates.

We may experience delays in initiating our clinical trials and we cannot be certain that the trials or any other future clinical trials for our product candidates will begin on time, need to be redesigned, enroll an adequate number of patients on time or be completed on schedule, if at all. Clinical trials can be delayed or terminated for a variety of reasons, including delay or failure related to:

We could also encounter delays if a clinical trial is suspended or terminated by us, by the IRBs of the institutions at which such trials are being conducted, by a data monitoring committee, or DMC, for such trial or by the FDA or other regulatory authorities. Such authorities may suspend or terminate a clinical trial due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or other regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial.

Moreover, principal investigators for our clinical trials may serve as scientific advisors or consultants to us from time to time and receive compensation in connection with such services. Under certain circumstances, we may be required to report some of these relationships to the FDA or comparable foreign regulatory authorities. The FDA or comparable foreign regulatory authority may conclude that a financial relationship between us and a principal investigator has created a conflict of interest or otherwise affected the interpretation of the trial. The FDA or comparable foreign regulatory authority may therefore question the integrity of the data generated at the applicable clinical trial site and the utility of the clinical trial itself may be jeopardized. This could result in a delay in approval, refusal to accept or rejection, of our marketing applications by the FDA or comparable foreign regulatory authority, and may ultimately lead to the denial of marketing approval of our product candidates.

If we experience delays in the completion of any clinical trial of our product candidates or the termination of any such clinical trial, the commercial prospects of our product candidates may be harmed, and our ability to generate drug revenues from any of these product candidates will be delayed or not realized at all. In addition, any delays in completing our clinical trials will increase our costs, slow down our product candidate development and approval process and jeopardize our ability to commence drug sales and generate revenues. Any of these occurrences may significantly harm our business, financial condition and prospects. In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of our product candidates.

In addition, if we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies governing clinical trials, our development plans may be impacted. For example, in December 2022, with the passage of Food and Drug Omnibus Reform Act, or FDORA, Congress required sponsors to develop and submit a Diversity Action Plan, or DAP, for each phase 3 clinical trial or any other “pivotal study” of a new drug or biological product. These plans are meant to encourage the enrollment of more diverse patient populations in late-stage clinical trials of FDA-regulated products. In June 2024, as mandated by FDORA, the FDA issued draft guidance outlining the general requirements for DAPs. Unlike most guidance documents issued by the FDA, the DAP guidance when finalized will have the force of law because FDORA specifically dictates that the form and manner for submission of DAPs are specified in FDA guidance. On January 27, 2025, in response to an Executive Order issued by President Trump on Diversity, Equity and Inclusion programs, the FDA removed this draft guidance from its website. The implications of this action are not yet known.

The regulatory landscape related to clinical trials in the EU also has recently evolved. The EU Clinical Trials Regulation, or CTR, which was adopted in April 2014 and repeals the EU Clinical Trials Directive, became applicable on January 31, 2022. While the Clinical Trials Directive required a separate clinical trial application, or CTA, to be submitted in each member state, to both the competent national health authority and an independent ethics committee, the CTR introduces a centralized process and only requires the submission of a single application to all member states concerned. The CTR allows sponsors to make a single submission to both the competent authority and an ethics committee in each member state, leading to a single decision per member state. The assessment procedure of the CTA has been harmonized as well, including a joint assessment by all member states concerned, and a separate assessment by each member state with respect to specific requirements related to its own territory, including ethics rules. Each member state’s decision is communicated to the sponsor via the centralized EU portal. Once the CTA is approved, clinical study development may proceed. The CTR foresees a three-year transition period. The extent to which ongoing and new clinical trials will be governed by the CTR varies. For clinical trials whose CTA was made under the Clinical Trials Directive before January 31, 2022, the Clinical Trials Directive will continue to apply on a transitional basis for three years. Additionally, sponsors were able to choose to submit a CTA under either the Clinical Trials Directive or the CTR until January 31, 2023 and, if authorized, those will be governed by the Clinical Trials Directive until January 31, 2025. Thereafter, all ongoing trials are subject to the provisions of the CTR.

If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies governing clinical trials, our development plans may be impacted.

If we encounter difficulties or delays enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected.

We may not be able to initiate or continue our planned clinical trials for our product candidates if we are unable to identify and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or comparable foreign regulatory authority. Patient enrollment, a significant factor in the timing of clinical trials, is affected by many factors including the size and nature of the patient population, the proximity of patients to clinical sites, the eligibility criteria for the clinical trial, the design of the clinical trial, competing clinical trials and clinicians’ and patients’ perceptions as to the potential advantages of the product candidate being studied in relation to other available therapies, including any new drugs that may be approved for the indications we are investigating.

The timely completion of clinical trials in accordance with their protocols depends, among other things, on our ability to enroll a sufficient number of patients who remain in the study until its conclusion. We may experience difficulties in patient enrollment in our clinical trials for a variety of reasons. The enrollment of patients depends on many factors, including:

In addition, our clinical trials will compete with other clinical trials for product candidates that are in the same therapeutic areas as our product candidates, and this competition will reduce the number and types of patients available to us, because some patients who might have opted to enroll in our trials may instead opt to enroll in a trial being conducted by one of our competitors.

Delays in patient enrollment may result in increased costs or may affect the timing or outcome of the planned clinical trials, which could prevent completion of these trials and adversely affect our ability to advance the development of our product candidates.

We face significant competition for our drug discovery and development efforts in an environment of rapid technological and scientific change, and our product candidates, if approved, will face significant competition, which may prevent us from achieving significant market penetration. Many of our competitors have significantly greater resources than we do, and we may not be able to successfully compete.

The pharmaceutical, biopharmaceutical and biotechnology industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on developing proprietary therapeutics. Numerous companies are engaged in the development, patenting, manufacturing and marketing of healthcare products competitive with those that we are developing. We face competition from a number of sources, such as pharmaceutical, biopharmaceutical and biotechnology companies, generic drug companies and academic and research institutions.

We are aware of both pharmaceutical and biotechnology companies with development programs in CML. Companies that have recently participated in or are participating in the development of CML treatments include, but are not limited to, Ascentage Pharma Group, Bristol-Myers Squibb Company, Enliven Therapeutics Inc., Jiangsu Hansoh Pharmaceutical Group Company Ltd., Novartis Pharmaceuticals Corp., Pfizer Inc., Shenzhen TargetRx Inc., Sun Pharma Industries Ltd., and Takeda Pharmaceutical Co., Ltd.

We are aware of both pharmaceutical and biotechnology companies with development programs in obesity. Companies that are participating in the development of obesity treatments include, but are not limited to, Abbvie Inc., Altimmune, Inc., Amgen, Inc., Ascletis Pharma, Inc., AstraZeneca PLC, Boehringer Ingelheim GmbH, Eli Lilly and Co., Gilead Sciences, Inc., Hanmi Pharmaceutical Co., Jiangsu Hansoh Pharmaceutical Group Company Ltd., Jiangsu Hengrui Pharmaceuticals Co. Ltd., Kailera Therapeutics, Merck & Co., Metsera Inc., LG Chem, Ltd., Novo Nordisk A/S, Pfizer Inc., Regor Therapeutics Group, Rhythm Pharmaceuticals, Inc., Rivus Pharmaceuticals, Inc., Roche Holding AG, Shionogi & Co. Ltd, Sciwind Biosciences Co., Ltd., Structure Therapeutics Inc., Viking Therapeutics, Inc, and Zealand Pharma A/S.

For TERN-800, our GIPR discovery series, companies conducting or planning to conduct clinical trials targeting GIPR or combinations with GIPR in the context of obesity include 9 Meters Biopharma, Inc., Amgen, Inc., Biomed Industries Inc., D&D Pharmatech, Eli Lilly and Co., Jiangsu Hansoh Pharmaceutical Group Company Ltd., Kailera Therapeutics, MBX Biosciences, Inc., Pfizer, Inc., Roche Holding AG, Sciwind Biosciences Co., Viking Therapeutics, Inc. Zealand Pharma A/S and Zhejiang Doer Biosciences Co., Ltd.

Furthermore, pharmaceutical and biotechnology companies who have recently engaged in the development of or are developing clinical-stage drugs to treat CML or obesity using mechanisms not mentioned above include 89Bio, Inc., Aardvark Therapeutics, Inc., Akero Therapeutics, Inc., Arrowhead Pharmaceuticals, Inc., Axcella Health, Inc., Carmot Therapeutics, Inc., Cirius Therapeutics, Inc., CohBar, Inc., Coherus Biosciences Inc., Corcept Therapeutics, Inc., Currax Pharmaceuticals LLC, CymaBay Therapeutics, Inc., CytoDyne Inc., Diasome Pharmaceuticals, Esperion Therapeutics, Inc., Fusion Pharma, LLC, Galectin Therapeutics Inc., Galmed Pharmaceuticals Ltd., Gila Therapeutics, Inc., Hanmi Pharmaceutical Co., Ltd., IL-YANG Pharm. Co. Ltd., Inhibikase Therapeutics, Inc., Inventiva Pharma SA, Ionis Pharmaceuticals, Inc., MediciNova, Inc., NGM Biopharmaceuticals, Inc., Norgine B.V., NorthSea Therapeutics, Inc., Pliant Therapeutics, Inc., Poxel SA, Saniona AB, Sagimet Biosciences, Inc., T3D Therapeutics, Inc., Vivus, Inc., and Zydus Cadila Healthcare.

It is also probable that the number of companies seeking to develop drugs and therapies for the treatment of serious diseases we pursue, such as obesity, will increase.

Many of our competitors have greater financial resources, marketing capabilities, sales forces, manufacturing capabilities, research and development capabilities, clinical trial expertise, intellectual property portfolios, experience in obtaining patents and regulatory approvals for drug candidates and other resources than we do. Some of the companies also have a broad range of other product offerings, large direct sales forces and long-term customer relationships with our target physicians, which could inhibit our market penetration efforts. Mergers and acquisitions in the pharmaceutical, biopharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.

Certain alternative treatments that may be approved and offered by competitors in the future may be available at lower prices and may offer greater efficacy or better safety profiles. Furthermore, currently approved products could be discovered to have application for the intended indication of our product candidates, which could give such products significant regulatory and market timing advantages over any of our product candidates. Our competitors also may obtain FDA or other foreign regulatory approval for their products more rapidly than we may obtain approval for ours and may obtain orphan product exclusivity from the FDA for indications our product candidates are targeting, which could result in our competitors establishing a strong market position before we are able to enter the market. In addition, our ability to compete may be affected in many cases by insurers or other third-party payors seeking to encourage the use of generic products. There are generic products currently on the market for certain of the indications that we are pursuing, and additional products are expected to become available on a generic basis over the coming years. If our product candidates are approved, we expect that they will be priced at a significant premium over competitive generic products.

Our product candidates may cause undesirable side effects or have other properties that could delay or prevent their regulatory approval, cause us to suspend or discontinue clinical trials, limit the commercial profile of an approved label, or result in significant negative consequences following marketing approval, if any.

Undesirable side effects caused by our product candidates could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the FDA or comparable foreign regulatory authorities. Results of our clinical trials could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics. While our clinical stage single-agent product candidates have been generally well-tolerated, we have observed AEs and laboratory abnormalities in the clinical trials for each of our single-agent candidates.

If unacceptable side effects arise in the development of our product candidates, we, the IRBs at the institutions in which our studies are conducted or the DMC could recommend suspension or termination of our clinical trials or the FDA or comparable foreign regulatory authorities could order us to cease clinical trials or deny approval of our product candidates for any or all targeted indications. Treatment-related side effects could also affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims. In addition, these side effects may not be appropriately recognized or managed by the treating medical staff. Furthermore, we may be required to expend time and incur costs to train medical personnel using our product candidates to understand the side effect profiles for our clinical trials and upon any commercialization of any of our product candidates. Inadequate training in recognizing or managing the potential side effects of our product candidates could result in patient injury or death. Any of these occurrences may harm our business, financial condition and prospects significantly.

In addition, if any of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such drugs, a number of potentially significant negative consequences could result, including:

Any of the foregoing events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved, and result in the loss of significant revenues to us, which would materially and adversely affect our results of operations and business.

Interim, top-line and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.

From time to time, we may publicly disclose interim, top-line or preliminary data from our clinical trials, which is based on a preliminary analysis of then-available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial. We also make assumptions, estimations, calculations and conclusions as part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the interim, top-line or preliminary results that we report may differ from future results of the same studies, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Interim, top-line and preliminary data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published. As a result, such data should be viewed with caution until the final data are available. From time to time, we may also disclose interim data from our clinical trials. Interim, top-line or preliminary data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. Adverse differences between interim, top-line or preliminary data and final data could significantly harm our business prospects.

Further, others, including regulatory agencies, may not accept or agree with our assumptions, estimates, calculations, conclusions or analyses or may interpret or weigh the importance of data differently, which could impact the value of the particular program, the approvability or commercialization of the particular product candidate and our company in general. In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with what we determine is the material or otherwise appropriate information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities or otherwise regarding a particular product candidate or our business. If the interim, top-line or preliminary data that we report differ from actual results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for and commercialize, our product candidates may be harmed, which could harm our business, operating results, prospects or financial condition.

The regulatory approval process is lengthy, expensive and uncertain, and we may be unable to obtain regulatory approval for our product candidates under applicable regulatory requirements. The denial or delay of any such approval would delay commercialization of our product candidates and adversely impact our ability to generate revenue, our business and our results of operations.

The development, research, testing, manufacturing, labeling, approval, selling, import, export, marketing, promotion and distribution of drug products are subject to extensive and evolving regulation by federal, state and local governmental authorities in the United States, principally the FDA and by foreign regulatory authorities, which regulations differ from country to country. Neither we nor any future collaborator is permitted to market any of our product candidates in the United States until we receive regulatory approval of an NDA from the FDA.

Obtaining regulatory approval of an NDA or similar applications required in foreign jurisdictions can be a lengthy, expensive and uncertain process. Prior to obtaining approval to commercialize a product candidate in the United States or abroad, we or our collaborators must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA or other foreign regulatory authorities, that such product candidates are safe and effective for their intended uses. The number of nonclinical studies and clinical trials that will be required for regulatory approval varies depending on the product candidate, the disease or condition that the product candidate is designed to address, and the regulations applicable to any particular product candidate.

Results from nonclinical studies and clinical trials can be interpreted in different ways. Even if we believe the nonclinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities. Administering product candidates to humans may produce undesirable side effects, which could interrupt, delay or halt clinical trials and result in the FDA or other regulatory authorities denying approval of a product candidate for any or all indications. The FDA or other regulatory authorities may also require us to conduct additional studies or trials for our product candidates either prior to or post-approval, such as additional clinical pharmacology studies or safety or efficacy studies or trials, or it may object to elements of our clinical development program such as the primary endpoints or the number of subjects in our clinical trials.

The FDA or any foreign regulatory authorities can delay, limit or deny approval of our product candidates or require us to conduct additional nonclinical or clinical testing or abandon a program for many reasons, including:

Of the large number of drugs in development, only a small percentage successfully complete the FDA or other regulatory approval processes and are commercialized. The lengthy development and 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, financial condition, results of operations and prospects.

Moreover, principal investigators for our future clinical trials may serve as scientific advisors or consultants to us and receive compensation in connection with such services. Under certain circumstances, we may be required to report some of these relationships to the FDA or comparable foreign regulatory authorities. The FDA or a comparable foreign regulatory authority may conclude that a financial relationship between us and a principal investigator has created a conflict of interest or otherwise affected interpretation of the study. The FDA or comparable foreign regulatory authority may therefore question the integrity of the data generated at the applicable clinical trial site and the utility of the clinical trial itself may be jeopardized. This could result in a delay in approval, or rejection, of our marketing applications by the FDA or comparable foreign regulatory authority, as the case may be, and may ultimately lead to the denial of marketing approval of one or more of our product candidates.

Further, under the Pediatric Research Equity Act, or PREA, an NDA or supplement to an NDA for certain biological products must contain data to assess the safety and effectiveness of the biological product in all relevant pediatric subpopulations and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective, unless the sponsor receives a deferral or waiver from the FDA. A deferral may be granted for several reasons, including a finding that the product or therapeutic candidate is ready for approval for use in adults before pediatric trials are complete or that additional safety or effectiveness data needs to be collected before the pediatric trials begin. The applicable legislation in the EU also requires sponsors to either conduct clinical trials in a pediatric population in accordance with a Pediatric Investigation Plan approved by the Pediatric Committee of the European Medicines Agency, or EMA, or to obtain a waiver or deferral from the conduct of these studies by this Committee. For any of our product candidates for which we are seeking regulatory approval in the United States or the EU, we cannot guarantee that we will be able to obtain a waiver or alternatively complete any required studies and other requirements in a timely manner, or at all, which could result in associated reputational harm and subject us to enforcement action.

Further, the FDA may determine that we must provide additional evidence and data before approving an NDA for our candidate products. For example, the FDA reviews an application to determine whether there is “substantial evidence” to support a finding of effectiveness for the proposed product for its intended use(s), The FDA has interpreted this evidentiary standard to generally require at least two adequate and well-controlled clinical trials to establish effectiveness of a new product. Under certain circumstances, however, the FDA has indicated that a single trial with certain characteristics and additional confirmatory evidence may satisfy this standard. The FDA issued draft guidance in September 2023 that outlines considerations for relying on confirmatory evidence in lieu of a second clinical trial to demonstrate effectiveness. In the event that we submit an NDA on the basis of one clinical trial and confirmatory evidence, the FDA could determine that such information is not sufficient to support approval of the application and the agency could require us to conduct an additional trial in support of the NDA.

Even if we eventually complete clinical testing and receive approval of an NDA or foreign marketing application for our product candidates, the FDA or the applicable foreign regulatory authority may grant approval contingent on the performance of costly additional clinical trials, including Phase 4 clinical trials, and/or in the case of the FDA, the implementation of a Risk Evaluation and Mitigation Strategy, or REMS, which may be required to ensure safe use of the drug after approval. The FDA or the applicable foreign regulatory authority also may approve a product candidate for a more limited indication or a narrower patient population than we originally requested, and the FDA or applicable foreign regulatory authority may not approve the labeling that we believe is necessary or desirable for the successful commercialization of a product candidate. Any delay in obtaining, or inability to obtain, applicable regulatory approval, or the failure to receive marketing authorization with a label that allows us to market the product candidate as we desire, would delay, prevent or otherwise limit commercialization of that product candidate and would materially adversely impact our business and prospects.

We are conducting clinical trials at sites outside the United States. The FDA may not accept data from trials conducted in such locations, and the conduct of trials outside the United States could subject us to additional delays and expense.

We are conducting one or more clinical trials with one or more trial sites that are located outside the United States. For example, our phase 1 clinical trial design of TERN-701 for the treatment of CML includes sites from the United States, Europe and other countries. The acceptance by the FDA or other regulatory authorities of study data from clinical trials conducted outside their jurisdiction may be subject to certain conditions or may not be accepted at all. In cases where data from foreign clinical trials are intended to serve as the sole basis for marketing approval in the United States, the FDA will generally not approve the application on the basis of foreign data alone unless (i) the data are applicable to the U.S. population and U.S. medical practice; (ii) the trials were performed by clinical investigators of recognized competence and pursuant to GCP regulations; and (iii) the data may be considered valid without the need for an on-site inspection by the FDA, or if the FDA considers such inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means.

In addition, even where the foreign study data are not intended to serve as the sole basis for approval, the FDA will not accept the data as support for an application for marketing approval unless the study is well-designed and well-conducted in accordance with GCP requirements and the FDA is able to validate the data from the study through an onsite inspection if deemed necessary. Many foreign regulatory authorities have similar approval requirements. In addition, such foreign trials would be subject to the applicable local laws of the foreign jurisdictions where the trials are conducted. There can be no assurance that the FDA or any comparable foreign regulatory authority will accept data from trials conducted outside of the United States or the applicable jurisdiction. If the FDA or any comparable foreign regulatory authority does not accept such data, it would result in the need for additional trials, which could be costly and time-consuming, and which may result in current or future product candidates that we may develop not receiving approval for commercialization in the applicable jurisdiction.

Conducting clinical trials outside the United States also exposes us to additional risks, including risks associated with:

We may seek Fast Track designation for some or all of our other product candidates, including combination therapy candidates. We may not receive such designation, and even for those product candidates for which we do, it may not lead to a faster development or regulatory review or approval process, and will not increase the likelihood that product candidates will receive marketing approval.

We may seek Fast Track designation for some of our other product candidates, including combination therapy candidates. If a drug is intended for the treatment of a serious or life-threatening condition or disease, and nonclinical or clinical data demonstrate the potential to address an unmet medical need, the drug may qualify for FDA Fast Track designation, for which sponsors must apply. The sponsor of a Fast Track product candidate has opportunities for more frequent interactions with the applicable FDA review team during product development and, once an NDA is submitted, the product candidate may be eligible for priority review. A Fast Track product candidate may also be eligible for rolling review, where the FDA may consider for review sections of the NDA on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the NDA, the FDA agrees to accept sections of the NDA and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the NDA. The FDA has broad discretion whether or not to grant this designation. Thus, even if we believe a particular product candidate is eligible for this designation, the FDA may decide not to grant it. Moreover, even if we do receive Fast Track designation, we or our collaborators may not experience a faster development process, review or approval compared to conventional FDA procedures. In addition, the FDA may withdraw Fast Track designation if it believes that the designation is no longer supported by data from our clinical development program.

A Breakthrough Therapy designation by the FDA, even if granted for any of our product candidates, may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that our product candidates will receive marketing approval.

We may seek a Breakthrough Therapy designation for one or more of our product candidates if the clinical data support such a designation for one or more product candidates. A Breakthrough Therapy is defined as a drug that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. For drug candidates that have been designated as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development. Breakthrough Therapy designation also provides the sponsor with the same benefits as Fast Track designation, including potential for rolling review of an NDA submission.

Designation as a Breakthrough Therapy is within the discretion of the FDA. Accordingly, even if we believe one of our product candidates meets the criteria for designation as a Breakthrough Therapy, the FDA may disagree and instead determine not to make such designation. In any event, the receipt of a Breakthrough Therapy designation for a product candidate may not result in a faster development process, review or approval compared to drug candidates considered for approval under non-expedited FDA review procedures and does not assure ultimate approval by the FDA. In addition, even if one or more of our product candidates qualify as Breakthrough Therapies, the FDA may later decide that the single-agent or combination therapy no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.

We may seek PRIME Designation in the European Union, but we might not receive such designations, and even if we do, such designation may not lead to a faster development or regulatory review or approval process.

In the EU, we may seek PRIME designation for some of our product candidates in the future. PRIME is a voluntary program aimed at enhancing the EMA’s role to reinforce scientific and regulatory support in order to optimize development and enable accelerated assessment of new medicines that are of major public health interest with the potential to address unmet medical needs. The program focuses on medicines that target conditions for which there exists no satisfactory method of treatment in the EU or even if such a method exists, it may offer a major therapeutic advantage over existing treatments. PRIME is limited to medicines under development and not authorized in the EU and the applicant intends to apply for an initial marketing authorization application through the centralized procedure. To be accepted for PRIME, a product candidate must meet the eligibility criteria in respect of its major public health interest and therapeutic innovation based on information that is capable of substantiating the claims. The benefits of a PRIME designation include the appointment of a Committee for Medicinal Products for Human Use rapporteur to provide continued support and help to build knowledge ahead of a marketing authorization application, early dialogue and scientific advice at key development milestones, and the potential to qualify products for accelerated review, meaning reduction in the review time for an opinion on approvability to be issued earlier in the application process. PRIME enables an applicant to request parallel EMA scientific advice and health technology assessment advice to facilitate timely market access. Even if we receive PRIME designation for any of our product candidates, the designation may not result in a materially faster development process, review or approval compared to conventional EMA procedures. Further, obtaining PRIME designation does not assure or increase the likelihood of EMA’s grant of a marketing authorization.

Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our product candidates in other jurisdictions.

Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not guarantee that we will be able to obtain or maintain regulatory approval in any other jurisdiction, while a failure or delay in obtaining regulatory approval in one jurisdiction may have a negative effect on the regulatory approval process in others. For example, even if the FDA grants marketing approval of a product candidate, comparable regulatory authorities in foreign jurisdictions must also approve the manufacturing, marketing and promotion of the product candidate in those countries. Approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and greater than, those in the United States, including additional preclinical studies or clinical trials as clinical studies conducted in one jurisdiction may not be accepted by regulatory authorities in other jurisdictions.

Moreover, in many jurisdictions outside the United States, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction. In some cases, the price that we intend to charge for our drugs is also subject to approval.

Obtaining foreign regulatory approvals and compliance with foreign regulatory requirements could result in significant delays, difficulties and costs for us and could delay or prevent the introduction of our drugs in certain countries. If we fail to comply with the regulatory requirements in international markets and/or receive applicable marketing approvals, our target market will be reduced and our ability to realize the full market potential of our product candidates will be harmed.

Additionally, we could face heightened risks with respect to obtaining marketing authorization in the UK as a result of the withdrawal of the UK from the EU, commonly referred to as Brexit. The UK is no longer part of the European Single Market and EU Customs Union. As of January 1, 2025, the Medicines and Healthcare Products Regulatory Agency, or MHRA, is responsible for approving all medicinal products destined for the United Kingdom market (i.e., Great Britain and Northern Ireland). At the same time, a new international recognition procedure (IRP) will apply, which intends to facilitate approval of pharmaceutical products in the UK. The IRP is open to applicants that have already received an authorization for the same product from one of the MHRA’s specified Reference Regulators (RRs). The RRs notably include EMA and regulators in the EU/European Economic Area (EEA) member states for approvals in the EU centralized procedure and mutual recognition procedure as well as the FDA (for product approvals granted in the U.S.). However, the concrete functioning of the IRP is currently unclear. Any delay in obtaining, or an inability to obtain, any marketing approvals may force us or our collaborators to restrict or delay efforts to seek regulatory approval in the UK for our product candidates, which could significantly and materially harm our business.

In addition, foreign regulatory authorities may change their approval policies and new regulations may be enacted. For instance, the EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020. The European Commission’s proposal for revision of several legislative instruments related to medicinal products (potentially reducing the duration of regulatory data protection and exclusivity periods for orphan drugs, revising the eligibility for expedited pathways, etc.) was published in April 2023. In April 2024, the European Parliament adopted a position on the proposal requesting several amendments to the package. The proposed revisions remain to be agreed and adopted by the European Parliament and European Council and the proposals may therefore be substantially revised before adoption, which is not anticipated before early 2026. The revisions may, however, have a significant impact on the pharmaceutical industry and our business in the long term.

We expect that we will be subject to additional risks in commercializing any of our product candidates that receive marketing approval outside the United States, including tariffs, trade barriers and regulatory requirements; economic weakness, including inflation, or political instability in particular foreign economies and markets; compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident to doing business in another country; and workforce uncertainty in countries where labor unrest is more common than in the United States.

Even if we receive regulatory approval of our product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense. Additionally, our product candidates, if approved, could be subject to labeling and other restrictions on marketing or withdrawal from the market, and we may be subject to penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our product candidates, when and if any of them are approved.

Any regulatory approvals that we receive for our product candidates may be subject to limitations on the approved indicated uses for which the drug may be marketed or the conditions of approval, or contain requirements for potentially costly post-market testing and surveillance to monitor the safety and efficacy of the product candidate. The FDA may also require us to adopt a REMS, and foreign regulatory authorities may require us to adopt similar risk management measures, to ensure that the benefits of treatment with such product candidate outweigh the risks for each potential patient, which may include, among other things, a communication plan to health care practitioners, patient education, extensive patient monitoring or distribution systems and processes that are highly controlled, restrictive and more costly than what is typical for the industry. We or our collaborators may also be required to adopt a REMS or engage in similar actions, such as patient education, certification of health care professionals or specific monitoring, if we or others later identify undesirable side effects caused by any drug that we develop alone or with collaborators.

In addition, if the FDA or a comparable foreign regulatory authority approves a product candidate, the manufacturing, quality control, labeling, packaging, distribution, AE reporting, storage, advertising, promotion, import, export and recordkeeping for the approved drug will be subject to extensive and ongoing regulatory requirements. The FDA and foreign regulatory authorities also require submissions of safety and other post-marketing information and reports, registration, as well as continued compliance with cGMP and similar foreign requirements and good clinical practice, or GCPs, for any clinical trials that we conduct post-approval. Later discovery of previously unknown problems with a product candidate, including AEs of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may result in, among other things:

Any government investigation of alleged violations of law could require us to expend significant time and resources in response and could generate negative publicity. Any failure to comply with ongoing regulatory requirements may significantly and adversely affect our ability to commercialize and generate revenue from our drugs. If regulatory sanctions are applied or if regulatory approval is withdrawn, the value of our company and our operating results will be adversely affected.

The FDA’s and other 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 cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. For example, the policies advanced by the Trump Administration and the FDA Commissioner may impact our business and industry and the regulation of our products. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may be subject to enforcement action and we may not achieve or sustain profitability.

In addition, we could be adversely affected by several significant administrative law cases decided by the U.S. Supreme Court in 2024. In Loper Bright Enterprises v. Raimondo, for example, the court overruled Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., which for 40 years required federal courts to defer to permissible agency interpretations of statutes that are silent or ambiguous on a particular topic. The U.S. Supreme Court stripped federal agencies of this presumptive deference and held that courts must exercise their independent judgment when deciding whether an agency such as the FDA acted within its statutory authority under the Administrative Procedure Act, or the APA. Additionally, in Corner Post, Inc. v. Board of Governors of the Federal Reserve System, the court held that actions to challenge a federal regulation under the APA can be initiated within six years of the date of injury to the plaintiff, rather than the date the rule is finalized. The decision appears to give prospective plaintiffs a personal statute of limitations to challenge longstanding agency regulations. Another decision, Securities and Exchange Commission v. Jarkesy, overturned regulatory agencies’ ability to impose civil penalties in administrative proceedings. These decisions could introduce additional uncertainty into the regulatory process and may result in additional legal challenges to actions taken by federal regulatory agencies, including the FDA and CMS, that we rely on. In addition to potential changes to regulations as a result of legal challenges, these decisions may result in increased regulatory uncertainty and delays and other impacts, any of which could adversely impact our business and operations.

Further, our ability to develop and market new drug products may be impacted by litigation challenging the FDA’s approval of another company’s drug product. In April 2023, the U.S. District Court for the Northern District of Texas invalidated the approval by the FDA of mifepristone, a drug product which was originally approved in 2000 and whose distribution is governed by various measures adopted under a REMS. The Court of Appeals for the Fifth Circuit declined to order the removal of mifepristone from the market but did hold that plaintiffs were likely to prevail in their claim that changes allowing for expanded access of mifepristone, which the FDA authorized in 2016 and 2021, were arbitrary and capricious. In June 2024, the Supreme Court reversed that decision after unanimously finding that the plaintiffs (anti-abortion doctors and organizations) did not have standing to bring this legal action against the FDA. On October 11, 2024, the Attorneys General of three states (Missouri, Idaho and Kansas) filed an amended complaint in the district court in Texas challenging FDA’s actions. On January 16, 2025, the district court agreed to allow these states to file an amended complaint and continue to pursue this challenge. Depending on the outcome of this litigation, our ability to develop new drug product candidates and to maintain approval of existing drug products could be delayed, undermined or subject to protracted litigation.

Any regulatory approval to market our products will be limited by indication. If we fail to comply or are found to be in violation of FDA regulations restricting the promotion of our products for unapproved uses, we could be subject to criminal penalties, substantial fines or other sanctions and damage awards.

The regulations relating to the promotion of products for unapproved uses are complex and subject to substantial interpretation by the FDA, EMA, MHRA and other government agencies. In September 2021, the FDA published final regulations which describe the types of evidence that the agency will consider in determining the intended use of a drug product. Physicians may nevertheless prescribe our products off-label to their patients in a manner that is inconsistent with the approved label. We intend to implement compliance and training programs designed to ensure that our sales and marketing practices comply with applicable regulations. Notwithstanding these programs, the FDA or other government agencies may allege or find that our practices constitute prohibited promotion of our products for unapproved uses. We also cannot be sure that our employees will comply with company policies and applicable regulations regarding the promotion of products for unapproved uses.

Notwithstanding the regulatory restrictions on off-label promotion, the FDA and other regulatory authorities allow companies to engage in truthful, non-misleading, and non-promotional scientific communications concerning their products in certain circumstances. For example, in January 2025, the FDA published final guidance outlining its policies governing the distribution of scientific information to healthcare providers about unapproved uses of approved products. The final guidance calls for such communications to be truthful, non-misleading and scientifically sound and to include all information necessary for healthcare providers to interpret the strengths and weaknesses and validity and utility of the information about the unapproved use of the approved product. If a company engages in such communications consistent with the guidance’s recommendations, the FDA indicated that it will not treat such communications as evidence of unlawful promotion of a new intended use for the approved product.

In addition, under some relatively recent guidance from the FDA and the Pre-Approval Information Exchange Act, or PIE Act, signed into law as part of the Consolidated Appropriations Act of 2023, companies may also promote information that is consistent with the prescribing information and proactively speak to formulary committee members of payors regarding data for an unapproved drug or unapproved uses of an approved drug. We may engage in these discussions and communicate with healthcare providers, payors and other constituencies in compliance with all applicable laws, regulatory guidance and industry best practices. We will need to carefully navigate the FDA’s various regulations, guidance and policies, along with recently enacted legislation, to ensure compliance with restrictions governing promotion of our products.

In recent years, a significant number of pharmaceutical and biotechnology companies have been the target of inquiries and investigations by various federal and state regulatory, investigative, prosecutorial and administrative entities in connection with the promotion of products for unapproved uses and other sales practices, including the Department of Justice and various U.S. Attorneys’ Offices, the Office of Inspector General of the Department of Health and Human Services, the FDA, the Federal Trade Commission, or the FTC, and various state Attorneys General offices. These investigations have alleged violations of various federal and state laws and regulations, including claims asserting antitrust violations, violations of the FDCA, the False Claims Act, the Prescription Drug Marketing Act and anti-kickback laws and other alleged violations in connection with the promotion of products for unapproved uses, pricing and Medicare and/or Medicaid reimbursement. Many of these investigations originate as “qui tam” actions under the False Claims Act. Under the False Claims Act, any individual can bring a claim on behalf of the government alleging that a person or entity has presented a false claim or caused a false claim to be submitted to the government for payment. The person bringing a qui tam suit is entitled to a share of any recovery or settlement. Qui tam suits, also commonly referred to as “whistleblower suits,” are often brought by current or former employees. In a qui tam suit, the government must decide whether to intervene and prosecute the case. If it declines, the individual may pursue the case alone.

If the FDA or any other governmental agency initiates an enforcement action against us or if we are the subject of a qui tam suit and it is determined that we violated prohibitions relating to the promotion of products for unapproved uses, we could be subject to substantial civil or criminal fines or damage awards and other sanctions such as consent decrees and corporate integrity agreements pursuant to which our activities would be subject to ongoing scrutiny and monitoring to ensure compliance with applicable laws and regulations. Any such fines, awards or other sanctions would have an adverse effect on our revenue, business, financial prospects and reputation.

Our development programs may target indications that do not have a clearly defined regulatory pathway. For such indications, there is a heightened risk that we will not be able to gain agreement with regulatory authorities regarding an acceptable development plan, that the outcome of our clinical trials will not be favorable or that, even if favorable, regulatory authorities may not find the results of our clinical trials to be sufficient for marketing approval. This may make it difficult to predict the timing and costs of the clinical development of our product candidates.

We may evaluate our product candidates for, and may develop new drug candidates for, indications that do not have a clearly defined regulatory pathway, including potentially indications which have limited or no approved therapies. The regulatory approval process for novel drug candidates can be more expensive and take longer than for other, better known or extensively studied drug candidates. We expect that the path for regulatory approval for these therapies to continue to evolve as companies refine their regulatory approval strategies and interact with regulatory authorities. Such evolution may impact our future clinical trial designs, including trial size and approval endpoints, in ways that we cannot predict today.

In the United States, the FDA generally requires two adequate and well-controlled pivotal clinical trials to approve an NDA. Furthermore, for full approval of an NDA, the FDA requires a demonstration of efficacy based on a clinical benefit endpoint. The FDA may grant accelerated approval based on a surrogate endpoint reasonably likely to predict clinical benefit. Even though our pivotal clinical trials for a specific indication may achieve their primary endpoints and are reasonably believed by us to be likely to predict clinical benefit, the FDA may not accept the results of such trials or approve our product candidates on an accelerated basis, or at all. It is also possible that the FDA may refuse to accept for filing and review any regulatory application we submit for regulatory approval in the United States. Even if our regulatory application is accepted for review, there may be delays in the FDA’s review process and the FDA may determine that such regulatory application does not contain adequate clinical or other data or support the approval of the product candidate. In such a case, the FDA may issue a complete response letter that may require that we conduct and/or complete additional clinical trials and preclinical studies or provide additional information or data before it will reconsider an application for approval. Any such requirements may be substantial, expensive and time-consuming, and there is no guarantee that we will continue to pursue such application or that the FDA will ultimately decide that any such application supports the approval of the product candidate. Furthermore, the FDA may also refer any regulatory application to an advisory committee for review and recommendation as to whether, and under what conditions, the application should be approved. While the FDA is not bound by the recommendation of an advisory committee, it considers such recommendations carefully when making decisions. Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential product to market could decrease our ability to generate sufficient revenue to maintain our business. Similar risks may apply in foreign jurisdictions.

Even if we receive accelerated approval for any of our product candidates, we anticipate we may be required to conduct or complete a post-approval clinical outcomes trial to confirm the clinical benefit of such product candidates by demonstrating the correlation of the surrogate endpoint therapeutic response in patients with a significant reduction in adverse clinical outcomes over time. There can be no assurance that the clinical outcomes trial will confirm that the surrogate endpoint used as the basis of the regulatory submissions we make will eventually show an adequate correlation with clinical outcomes.

Further, to the extent that we seek accelerated approval, we will need to comply with new provisions governing that route to approval. For example, with the passage of the Food and Drug Omnibus Reform Act, or FDORA, in December 2022, Congress modified certain provisions governing accelerated approval of drug and biologic products. Specifically, the new legislation authorized the FDA to: require a sponsor to have its confirmatory clinical trial underway before accelerated approval is awarded, require a sponsor of a product granted accelerated approval to submit progress reports on its post-approval studies to FDA every six months (until the study is completed); and use expedited procedures to withdraw accelerated approval of an NDA after the confirmatory trial fails to verify the product’s clinical benefit. Further, FDORA requires the agency to publish on its website “the rationale for why a post-approval study is not appropriate or necessary” whenever it decides not to require such a study upon granting accelerated approval.

In March 2023, the FDA issued draft guidance that outlines its current thinking and approach to accelerated approval. The agency indicated that the accelerated approval pathway is commonly used for approval of oncology drugs due to the serious and life-threatening nature of cancer. Although single-arm trials have been commonly used to support accelerated approval, a randomized controlled trial is the preferred approach as it provides a more robust efficacy and safety assessment and allows for direct comparisons to an available therapy. To that end, the FDA outlined considerations for designing, conducting, and analyzing data for trials intended to support accelerated approvals of oncology therapeutics. Subsequently, in December 2024 and January 2025, the FDA issued additional draft guidances relating to accelerated approval. These guidances describe FDA’s latest thinking on what it means to conduct a confirmatory trial with due diligence and how the agency plans to interpret whether such a study needs to be underway at the time of approval. While these guidances are currently only in draft form and will ultimately not be legally binding even when finalized, sponsors typically observe the FDA’s guidance closely to ensure that their investigational products qualify for accelerated approval.

Our anticipated development costs would likely increase if development of any current or future product candidate is delayed because we are required by the FDA or similar foreign regulatory authorities to perform studies or trials in addition to, or different from, those that we currently conduct or anticipate. Because of the numerous risks and uncertainties associated with pharmaceutical product development, we are unable to predict the timing or amount of any increase in our anticipated development costs.

We also may evaluate our product candidates in combination with one or more therapies that have not yet been approved for marketing by the FDA or similar foreign regulatory authorities. We may not be able to market and sell any product candidate we develop in combination with an unapproved therapy if that unapproved therapy does not ultimately obtain marketing approval. In addition, unapproved therapies face the same risks described with respect to our product candidates currently in development, including the potential for serious adverse effects, delay in their clinical trials and lack of FDA or European Commission approval. If the FDA, the European Commission or similar foreign regulatory authorities do not approve these other therapies or revoke their approval of, or if safety, efficacy, manufacturing, or supply issues arise with, the therapies we choose to evaluate in combination with our product candidates, we may be unable to obtain approval of or market any such product candidate.

Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire and retain key leadership and other personnel, or otherwise prevent new products and services from being developed 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, ability to hire and retain key personnel and accept the payment of user fees and statutory, regulatory and policy changes. Average review times at the FDA and foreign regulatory authorities have fluctuated in recent years as a result. In addition, government funding of other government agencies that fund research and development activities is subject to the political process, which is inherently fluid and unpredictable.

Disruptions at the FDA, EMA and other agencies may also slow the time necessary for new drugs to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. For example, over the last several years, the U.S. government shut down several times and certain regulatory agencies, such as the FDA and the SEC, had to furlough critical employees and stop critical activities.

In addition, disruptions may result due to events similar to the COVID-19 pandemic. During the COVID-19 pandemic, a number of companies announced receipt of complete response letters due to the FDA’s inability to complete required inspections for their applications. In the event of a similar public health emergency in the future, the FDA may not be able to continue its current pace and review timelines could be extended. Regulatory authorities outside the United States facing similar circumstances may adopt similar restrictions or other policy measures in response to a similar public health emergency and may also experience delays in their regulatory activities.

Further, there is substantial uncertainty as to how measures being implemented by the new Trump Administration across the government will impact the FDA, CMS and other federal agencies with jurisdiction over our activities. For example, since taking office, President Trump has issued a number of executive orders, which could have a significant impact on the manner in which the FDA conducts its operations and engages in regulatory and oversight activities. These include E.O. 14192, “Unleashing Prosperity Through Deregulation,” January 31, 2025; E.O. 14212, “Establishing the President’s Make America Healthy Again Commission,” February 13, 2025; and E.O. 14219, Ensuring Lawful Governance and Implementing the President’s ‘Department of Government Efficiency” Deregulatory Initiative,” February 21, 2025. If these or other orders or executive actions impose constraints on FDA’s ability to engage in oversight and implementation activities in the normal course, our business may be negatively impacted. In addition, the loss of FDA personnel could lead to further disruptions and delays in FDA review and oversight of our product candidates. Similarly, efforts by the new administration to substantially reduce or delay research funding by the National Institutes of Health of medical research could have substantial direct or indirect impacts on our research activities.

If a prolonged government shutdown occurs, or if global health concerns continue to prevent the FDA or other regulatory authorities from conducting their regular inspections, reviews, or other regulatory activities, it could significantly impact the ability of the FDA or other regulatory authorities to timely review and process our regulatory submissions, which could have a material adverse effect on our business.

We rely completely on third parties to manufacture our clinical drug supplies and we intend to rely on third parties to produce commercial supplies of any approved product candidate, and our commercialization of any of our product candidates could be stopped, delayed or made less profitable if those third parties fail to obtain approval of the FDA or comparable regulatory authorities, fail to provide us with sufficient quantities of drug product or fail to do so at acceptable quality levels or prices.

We do not currently have nor do we plan to acquire the infrastructure or capability internally to manufacture our clinical drug supplies for use in the conduct of our clinical trials, and we lack the resources and the capability to manufacture any of our product candidates on a clinical or commercial scale. The facilities used by our contract manufacturers to manufacture our product candidates must be approved by the FDA or comparable foreign regulatory authorities pursuant to inspections that will be conducted after we submit our NDA to the FDA or comparable applications to those foreign authorities. We do not control the manufacturing process of, and are completely dependent on, our contract manufacturing partners for compliance with cGMPs or similar foreign requirements for manufacture of both active drug substances and finished drug products. If our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of the FDA or others, they will not be able to secure and/or maintain regulatory approval for their manufacturing facilities. In addition, we have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified personnel. If the FDA or a comparable foreign regulatory authority does not approve these facilities for the manufacture of our product candidates or if it withdraws any such approval in the future, we may need to find alternative manufacturing facilities, which would significantly impact our ability to develop, obtain regulatory approval for or market our product candidates, if approved.

We may be unable to obtain raw materials or drug components for an indeterminate period of time if any of our third-party suppliers and manufacturers were to cease or interrupt production or otherwise fail to supply these materials or components to us for any reason, including due to regulatory requirements or actions (including recalls), adverse financial developments at or affecting the supplier or manufacturer, failure by the supplier or manufacturer to comply with current good manufacturing practices, or cGMPs, contaminations, business interruptions, or labor shortages or disputes, or if we were to terminate our relationship with any of our third-party suppliers or manufacturers for any reason. For example, proposed legislation has been introduced in Congress that could prohibit, among other things, U.S. government agencies from entering into contracts with companies that use certain equipment or services provided by certain Chinese companies, which could cause us to reevaluate our relationship with our Chinese contract manufacturer.

Any replacement of our manufacturers could require significant effort and expertise because there may be a limited number of qualified replacements. In some cases, the technology required to manufacture our product candidates may be unique to the original manufacturer and we may have difficulty transferring such skills or technology to another third party. The process of changing manufacturers is extensive and time-consuming and could cause delays or interruptions in our drug development. Further, if we are required to change manufacturers for any reason, we will be required to verify that the new manufacturer maintains facilities and procedures that comply with quality standards and with all applicable regulations and guidelines. The delays associated with the verification of a new manufacturer could negatively affect our ability to develop product candidates in a timely manner or within budget.

We rely on our manufacturers to purchase from third-party suppliers the materials necessary to produce our product candidates for our clinical trials. There are a limited number of suppliers for raw materials that we use to manufacture our drugs and there may be a need to assess alternate suppliers to prevent a possible disruption of the manufacture of the materials necessary to produce our product candidates for our clinical trials, and if approved, ultimately for commercial sale. We do not have any control over the process or timing of the acquisition of these raw materials by our manufacturers. Moreover, we currently do not have any agreements for the commercial production of these raw materials. Although we generally do not begin a clinical trial unless we believe we have a sufficient supply of a product candidate to complete the clinical trial, any significant delay in the supply of a product candidate, or the raw material components thereof, for an ongoing clinical trial due to the need to replace a third-party manufacturer could considerably delay completion of our clinical trials, product testing and potential regulatory approval of our product candidates. If our manufacturers or we are unable to purchase these raw materials after regulatory approval has been obtained for our product candidates, the commercial launch of our product candidates would be delayed or there would be a shortage in supply, which would impair our ability to generate revenues from the sale of our product candidates.

We, or our manufacturing partners, may be unable to successfully increase the manufacturing capacity for any of our product candidates in a timely or cost-effective manner, or at all. In addition, quality issues may arise during scale-up activities. If we or our manufacturing partners are unable to successfully scale up the manufacture of our product candidates in sufficient quality and quantity, the development, testing and clinical trials of that product candidate may be delayed or become infeasible, and marketing approval or commercial launch of any resulting product may be delayed or not obtained, which could significantly harm our business.

We expect to continue to depend on third-party contract manufacturers for the foreseeable future. We have not entered into long-term agreements with our current contract manufacturers or with any alternate fill/finish suppliers, and though we intend to do so prior to commercial launch in order to ensure that we maintain adequate supplies of finished drug product, we may be unable to enter into such an agreement or do so on commercially reasonable terms, which could have a material adverse impact upon our business. We currently obtain our supplies of finished drug product through individual purchase orders.

We rely on third parties to conduct, supervise and monitor our preclinical and clinical trials. If these third parties do not successfully carry out their contractual duties, meet rigorously enforced regulatory standards or meet expected deadlines, we may be unable to obtain regulatory approval for or commercialize any of our product candidates on a timely basis or at all.

We currently do not have the ability to independently conduct preclinical studies that comply with the regulatory requirements known as good laboratory practice, or GLP, requirements. The FDA and regulatory authorities in other jurisdictions require us to comply with GCP requirements for conducting, monitoring, recording and reporting the results of clinical trials, in order to ensure that the data and results are scientifically credible and accurate and that the trial subjects are adequately informed of the potential risks of participating in clinical trials. We rely on medical institutions, clinical investigators, contract laboratories and other third parties, such as CROs, to conduct GLP-compliant nonclinical studies and GCP-compliant clinical trials on our product candidates properly and on time. While we will have agreements governing their activities, we control only certain aspects of their activities and have limited influence over their actual performance. The third parties with whom we contract for execution of our GLP nonclinical studies and our GCP clinical trials play a significant role in the conduct of these studies and trials and the subsequent collection and analysis of data. These third parties are not our employees and, except for restrictions imposed by our contracts with such third parties, we have limited ability to control the amount or timing of resources that they devote to our programs. Although we rely on these third parties to conduct GLP-compliant preclinical and nonclinical studies and GCP-compliant clinical trials for our product candidates, we remain responsible for ensuring that each of our GLP preclinical studies and clinical trials is conducted in accordance with its investigational plan and protocol and applicable laws and regulations, and our reliance on the CROs does not relieve us of our regulatory responsibilities.

Many of the third parties with whom we contract may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials or other drug development activities that could harm our competitive position. If the third parties conducting our GLP preclinical or nonclinical studies or our clinical trials do not perform their contractual duties or obligations, experience work stoppages, do not meet expected deadlines, terminate their agreements with us or need to be replaced, or if the quality or accuracy of the clinical data they obtain is compromised due to their failure to adhere to our clinical trial protocols or to GCPs, or for any other reason, we may need to enter into new arrangements with alternative third parties. This could be difficult, costly or impossible, and our preclinical studies or clinical trials may need to be extended, delayed, terminated or repeated. As a result we may not be able to obtain regulatory approval in a timely fashion, or at all, for the applicable product candidate, our financial results and the commercial prospects for our product candidates would be harmed, our costs could increase and our ability to generate revenues could be delayed.

We depend on collaborations with third parties for the development of certain of our drug candidates, and we may depend on additional collaborations in the future for the development and commercialization of these or other potential candidates. If our collaborations are not successful, our ability to develop and commercialize our product candidates could be adversely affected.

We are currently collaborating with third parties to develop certain of our potential drug candidates. For example, we are collaborating with Hansoh (Shanghai) Healthtech Co., Ltd. and Jiangsu Hansoh Pharmaceutical Group Company Ltd. with respect to certain aspects of TERN-701, our small-molecule allosteric inhibitor of the BCR-ABL fusion gene. In the future, we may seek collaboration arrangements for the commercialization, or potentially for the development, of certain of our other product candidates depending on the merits of retaining commercialization rights for ourselves as compared to entering into collaboration arrangements. For example, certain of the disease areas that we believe our product candidates address require large, costly and later-stage clinical trials, which a collaboration partner may be better positioned to finance and/or conduct. In addition, a component of our strategy is to maximize the commercial value of our current and future product candidates, which may also strategically align with partnering commercial rights with partners that have large and established sales organizations. To the extent that we decide to enter into collaboration agreements, we may face significant competition for appropriate collaborators. Moreover, collaboration arrangements are complex and time-consuming to negotiate, document, implement and maintain and challenging to manage. We may not be successful in our efforts to enter into collaboration agreements. The terms of collaborations or other arrangements that we may establish may not be favorable to us.

The success of our current and future collaboration arrangements will depend heavily on the efforts and activities of our collaborators.

If our collaborations on research and development candidates do not result in the successful development and commercialization of products or if one of our collaborators terminates its agreement with us, we may not receive any future milestone or royalty payments under the collaboration.

If conflicts arise between us and our collaborators or strategic partners, these parties may act in a manner adverse to us and could limit our ability to implement our strategies.

If conflicts arise between our collaborators or strategic partners and us, the other party may act in a manner adverse to us and could limit our ability to implement our strategies. Current or future collaborators or strategic partners may develop, either alone or with others, products in related fields that are competitive with the products or potential products that are the subject of these collaborations.

Our current or future collaborators or strategic partners may preclude us from entering into collaborations with their competitors, fail to obtain timely regulatory approvals, terminate their agreements with us prematurely or fail to devote sufficient resources to the development and commercialization of products. Furthermore, competing products, either developed by our current or future collaborators or strategic partners or to which our collaborators or strategic partners may have rights, may result in the withdrawal of partner support for our product candidates. Any of these developments could harm our product development efforts.

The successful commercialization of our product candidates will depend in part on the extent to which governmental authorities and health insurers establish adequate coverage, reimbursement levels and pricing policies. Failure to obtain or maintain coverage and adequate reimbursement for our product candidates, if approved, could limit our ability to market those drugs and decrease our ability to generate revenue.

The availability and adequacy of coverage and reimbursement by governmental healthcare programs such as Medicare and Medicaid, private health insurers and other third-party payors are essential for most patients to be able to afford prescription medications such as our product candidates, assuming FDA approval. Our ability to achieve acceptable levels of coverage and reimbursement for products by governmental authorities, private health insurers and other organizations will have an effect on our ability to successfully commercialize our product candidates. Assuming we obtain coverage for our product candidates by a third-party payor, the resulting reimbursement payment rates may not be adequate or may require co-payments that patients find unacceptably high. We cannot be sure that coverage and reimbursement in the United States, the European Economic Area, or EEA, or elsewhere will be available for our product candidates or any product that we may develop, and any reimbursement that may become available may be decreased or eliminated.

Third-party payors increasingly are challenging prices charged for pharmaceutical products and services, and many third-party payors may refuse to provide coverage and reimbursement for particular drugs or biologics when an equivalent generic drug, biosimilar or a less expensive therapy is available. It is possible that a third-party payor may consider our product candidates as substitutable and only offer to reimburse patients for the less expensive drug. Even if we show improved efficacy or improved convenience of administration with our product candidates, pricing of existing third-party therapeutics may limit the amount we will be able to charge for our product candidates. These payors may deny or revoke the reimbursement status of a given product or establish prices for new or existing marketed products at levels that are too low to enable us to realize an appropriate return on our investment in our product candidates. For products administered under the supervision of a physician, obtaining coverage and adequate reimbursement may be even more challenging given third-party payor price sensitivity to high-cost therapeutics (including oncology and other specialty medicines). Additionally, separate reimbursement for the product itself or the treatment or procedure in which the product is used may not be available, which may impact physician utilization. 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.

No uniform policy for coverage and reimbursement for products exists among third-party payors in the United States. Therefore, coverage and reimbursement for products can differ significantly from payor to payor. As a result, the coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our product candidates to each payor separately, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance. Furthermore, rules and regulations regarding reimbursement change frequently, in some cases on short notice, and such changes also may significantly impact the coverage and reimbursement levels for our products.

Outside the United States, international operations are generally subject to extensive governmental price controls and other market regulations, and we believe the increasing emphasis on cost-containment initiatives in Europe and other countries have and will continue to put pressure on the pricing and usage of our product candidates. In many countries, the prices of medical products are subject to varying price control mechanisms as part of national health systems. Other countries allow companies to fix their own prices for medical products, and instead monitor and control company profits. Additional foreign price controls or other changes in pricing regulation could restrict the amount that we are able to charge for our product candidates. Accordingly, in markets outside the United States, the reimbursement for our product candidates may be reduced compared with the United States and may be insufficient to generate commercially-reasonable revenue and profits.

Moreover, increasing efforts by governmental and third-party payors in the United States and abroad to cap or reduce healthcare costs may cause such organizations to limit both coverage and the level of reimbursement for newly approved products and, as a result, they may not cover or provide adequate payment for our product candidates. 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 and remains intense. As a result, increasingly high barriers are being erected to the entry of new products.

Even if our current or future product candidates obtain regulatory approval, they may fail to achieve the broad degree of physician and patient adoption and use necessary for commercial success.

Even if one or more of our product candidates receive FDA or other regulatory approvals, the commercial success of any of our current or future product candidates will depend significantly on the broad adoption and use of the resulting product by physicians and patients for approved indications. Given the number of drugs commercially available or in development for the treatment of CML, obesity, and other indications we pursue or may pursue, if we are unsuccessful in achieving a differentiated profile with our product candidates based on efficacy, safety and tolerability, dosing and administration, market acceptance may be limited. Our product candidates may not be commercially successful for a variety of reasons, including, among other things, competitive factors, pricing or physician preference, reimbursement by insurers, the degree and rate of physician and patient adoption of our current or future product candidates. If approved, the commercial success of our product candidates will depend on a number of factors, including:

We cannot assure you that our current or future product candidates, if approved, will achieve broad market acceptance among physicians and patients. Any failure by our product candidates that obtain regulatory approval to achieve market acceptance or commercial success would adversely affect our results of operations.

We currently have no sales organization. If we are unable to establish sales capabilities on our own or through third parties, we may not be able to market and sell our product candidates, if approved, effectively in the United States and foreign jurisdictions or generate drug revenue.

We currently do not have a sales organization. In order to commercialize our product candidates in the United States and foreign jurisdictions, we must build our marketing, sales, distribution, managerial and other non-technical capabilities or make arrangements with third parties to perform these services, and we may not be successful in doing so. If any of our product candidates receive regulatory approval, we expect to establish a sales organization with technical expertise and supporting distribution capabilities to commercialize each such product candidate, which will be expensive and time consuming. We have no prior experience in the marketing, sale and distribution of pharmaceutical, biopharmaceutical and biotechnology products, and there are significant risks involved in building and managing a sales organization, including our ability to hire, retain and incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team. Any failure or delay in the development of our internal sales, marketing and distribution capabilities would adversely impact the commercialization of these products. We may choose to collaborate with third parties that have direct sales forces and established distribution systems, either to augment our own sales force and distribution systems or in lieu of our own sales force and distribution systems. If we are unable to enter into such arrangements on acceptable terms or at all, we may not be able to successfully commercialize our product candidates. If we are not successful in commercializing our product candidates or any future product candidates, either on our own or through arrangements with one or more third parties, we may not be able to generate any future drug revenue and we would incur significant additional losses.

Our employees, principal investigators, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading.

We are exposed to the risk of fraud or other misconduct by our employees, principal investigators, CROs, consultants and commercial partners. Misconduct by these parties could include intentional failures to comply with the regulations of the FDA and non-U.S. regulators, provide accurate information to the FDA and non-U.S. regulators, comply with healthcare fraud and abuse laws and regulations in the United States and abroad, report financial information or data accurately or disclose unauthorized activities to us. In particular, sales, marketing and business arrangements in the healthcare industry are subject to extensive laws and regulations intended to prevent fraud, misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements. Such misconduct could also involve the improper use of information obtained in the course of clinical trials, which could result in regulatory sanctions and cause serious harm to our reputation. It is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations. If any such actions are instituted against us those actions could have a significant impact on our business, including the imposition of significant civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from government funded healthcare programs, such as Medicare and Medicaid, contractual damages, reputational harm, diminished profits and future earnings, additional reporting obligations and oversight if subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws and the curtailment or restructuring of our operations.

In addition, our contractors, consultants, employees, officers and members of our board of directors are regularly exposed to non-public information about corporate developments which could impact our stock price. Although we have procedures in place that are intended to prevent them from seeking to take advantage of that non-public information, it is possible that those individuals could attempt to profit from non-public information obtained from us, causing us reputational harm and exposing us to potential liability.

Our business operations and future relationships with investigators, healthcare professionals, consultants, third-party payors, patient organizations and customers will be subject to applicable healthcare regulatory laws, which could expose us to penalties.

Our business operations and future arrangements with investigators, healthcare professionals, consultants, third-party payors, patient organizations and customers, may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations. These laws may constrain the business or financial arrangements and relationships through which we will conduct our operations, including how we research, market, sell and distribute our product candidates, if approved. Such laws include:

Ensuring that our internal operations and future business arrangements with third parties comply with applicable healthcare laws and regulations will involve substantial costs. It is possible that governmental authorities will conclude that our business practices do not comply with current or future statutes, regulations, agency guidance or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations are found to be in violation of any of the laws described above or any other governmental laws and regulations that may apply to us, we may be subject to significant penalties, including civil, criminal and administrative penalties, damages, fines, exclusion from government-funded healthcare programs, such as Medicare and Medicaid or similar programs in other countries or jurisdictions, disgorgement, individual imprisonment, contractual damages, reputational harm, diminished profits and the curtailment or restructuring of our operations.

If we successfully commercialize any of our product candidates, we may participate in the Medicaid Drug Rebate Program or other governmental pricing programs, and may become subject to state drug price transparency requirements. Our failure to comply with the related reporting and payment obligations could result in additional reimbursement requirements, penalties, sanctions and fines that could have a material adverse effect on our business, financial condition, results of operations and growth prospects.

The Medicaid Drug Rebate Program, the 340B drug pricing program, the U.S. Department of Veterans Affairs Federal Supply Schedule program and other governmental pricing programs require participating manufacturers to report certain product and pricing data to the government. Pricing calculations vary among products and programs, are complex, and are often subject to interpretation by manufacturers, governmental or regulatory agencies and the courts, which can change and evolve over time. If we successfully commercialize any of our product candidates and participate in such governmental pricing programs, we may be held liable for errors associated with our submission of data. That liability could be significant, including potential civil monetary penalties per item of falsely reported or misrepresented drug pricing information. Such failure also could be grounds for other sanctions, such as termination from the Medicaid Drug Rebate Program. We cannot provide assurance that any of our submissions, if we participate in government price reporting programs, will not be found by a governmental agency to be incomplete, incorrect, or otherwise non-compliant. Further, a growing number of states have enacted drug price transparency laws requiring pharmaceutical manufacturers to report information to certain state agencies and other parties. Many of these laws provide for civil monetary penalties and other enforcement mechanisms if manufacturers are found to have violated requirements.

Enacted and future healthcare legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and may affect the prices we may set.

In the United States, the EEA and other jurisdictions, there have been, and we expect there will continue to be, a number of legislative and regulatory changes and proposed changes to the healthcare system that could affect our future results of operations. In particular, there have been and continue to be a number of initiatives at the U.S. federal and state levels that seek to reduce healthcare costs and improve the quality of healthcare. For example, in March 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively the ACA, was enacted, which substantially changed the way healthcare is financed by both governmental and private insurers. Among the provisions of the ACA, those of greatest importance to the pharmaceutical and biotechnology industries include the following:

Since its enactment, there have been judicial and Congressional challenges to certain aspects of the ACA. On June 17, 2021, the U.S. Supreme Court dismissed a judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA. Thus, the ACA will remain in effect in its current form. During the first Trump Administration, the Congress and administration sought to overturn the ACA and related measures. Shortly after taking office in January 2025, President Trump revoked numerous executive orders issued by President Biden, including at least two executive orders (EO 14009, Strengthening Medicaid and the Affordable Care Act, and EO 14070, Continuing to Strengthen Americans’ Access to Affordable, Quality Health Coverage) which were designed to further implement the ACA. We anticipate similar efforts to undermine the ACA, and the accompanying uncertainty, for the foreseeable future.

In addition, other legislative changes have been proposed and adopted in the United States since the ACA was enacted. For example, the Budget Control Act of 2011 resulted in aggregate reductions of Medicare payments to providers of 2% per fiscal year, which went into effect in April 2013 and, due to subsequent legislative amendments to the statute, will remain in effect through 2031, unless additional action is taken by Congress. Additionally, under Statutory PAYGO, the Administration is required to issue a sequestration order (capped at 4% for Medicare payments) if the PAYGO scorecard shows a net cost at the end of a Congressional session. Although Statutory PAYGO was expected to be triggered at the end of the 2021 Congressional session, subsequent legislation has delayed a Statutory PAYGO sequestration order until after 2024. In January 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, further reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. 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 future customers and accordingly, our financial operations. Indeed, under current legislation, the actual reductions in Medicare payments may vary up to 4%.

The prices of prescription pharmaceuticals in the United States and foreign jurisdictions are subject to scrutiny and considerable legislative and executive actions that could impact the prices we obtain for our drug products, if and when approved.

The prices of prescription pharmaceuticals have been the subject of considerable discussion in the United States. There have been Congressional inquiries, as well as proposed and enacted state and federal legislation designed to, among other things, bring more transparency to pharmaceutical pricing, review the relationship between pricing and manufacturer patient programs and reduce the costs of pharmaceuticals under Medicare and Medicaid.

In addition, in October 2020, HHS and the FDA published a final rule allowing states and other entities to develop a Section 804 Importation Program, or SIP, to import certain prescription drugs from Canada into the United States. That regulation was challenged in a lawsuit by the Pharmaceutical Research and Manufacturers of America (PhRMA) but the case was dismissed by a federal district court in February 2023 after the court found that PhRMA did not have standing to sue HHS. Seven states (Colorado, Florida, Maine, New Hampshire, New Mexico, Texas and Vermont) have passed laws allowing for the importation of drugs from Canada. North Dakota and Virginia have passed legislation establishing workgroups to examine the impact of a state importation program. As of May 2024, five states (Colorado, Florida, Maine, New Hampshire and New Mexico) had submitted Section 804 Importation Program proposals to the FDA and, on January 5, 2024, the FDA approved Florida’s plan for Canadian drug importation. That state now has authority to import certain drugs from Canada for a period of two years once certain conditions are met. Florida will first need to submit a pre-import request for each drug selected for importation, which must be approved by the FDA. The state will also need to relabel the drugs and perform quality testing of the products to meet FDA standards.

Further, on November 20, 2020, HHS finalized a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law. The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers. Pursuant to court order, the removal and addition of the aforementioned safe harbors were delayed and recent legislation imposed a moratorium on implementation of the rule until January 1, 2026. The Inflation Reduction Act of 2022 (IRA) further delayed implementation of this rule to January 1, 2032.

On August 16, 2022, the IRA was signed into law by President Biden. The new legislation has implications for Medicare Part D, which is a program available to individuals who are entitled to Medicare Part A or enrolled in Medicare Part B to give them the option of paying a monthly premium for outpatient prescription drug coverage. 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). The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years.

Specifically, with respect to price negotiations, Congress authorized Medicare to negotiate lower prices for certain costly single-source drug and biologic products that do not have competing generics or biosimilars and are reimbursed under Medicare Part B and Part D. CMS may negotiate prices for ten high-cost drugs paid for by Medicare Part D starting in 2026, followed by 15 Part D drugs in 2027, 15 Part B or Part D drugs in 2028 and 20 Part B or Part D drugs in 2029 and beyond. This provision applies to drug products that have been approved for at least 9 years and biologics that have been licensed for 13 years, but it does not apply to drugs and biologics that have been approved for a single rare disease or condition. Nonetheless, since CMS may establish a maximum price for these products in price negotiations, we would be fully at risk of government action if our products are the subject of Medicare price negotiations. Moreover, given the risk that could be the case, these provisions of the IRA may also further heighten the risk that we would not be able to achieve the expected return on our drug products or full value of our patents protecting our products if prices are set after such products have been on the market for nine years.

Further, the legislation subjects drug manufacturers to civil monetary penalties and a potential excise tax for failing to comply with the legislation by offering a price that is not equal to or less than the negotiated “maximum fair price” under the law or for taking price increases that exceed inflation. In addition to the drug price negotiation program, the IRA established inflation rebate programs under Medicare Part B and Part D. These programs require manufacturers to pay rebates to Medicare if they raise their prices for certain Part B and Part D drugs faster than the rate of inflation. On December 9, 2024, with issuance of its 2025 Physician Fee Schedule final regulation, CMS finalized its rules governing the IRA inflation rebate programs. The new law also capped Medicare out-of-pocket drug costs at an estimated $4,000 a year in 2024 and, thereafter beginning in 2025, at $2,000 a year. In addition, the IRA potentially raises legal risks with respect to individuals participating in a Medicare Part D prescription drug plan who may experience a gap in coverage if they required coverage above their initial annual coverage limit before they reached the higher threshold, or “catastrophic period” of the plan. Individuals requiring services exceeding the initial annual coverage limit and below the catastrophic period, must pay 100% of the cost of their prescriptions until they reach the catastrophic period. Among other things, the IRA contains many provisions aimed at reducing this financial burden on individuals by reducing the co-insurance and co-payment costs, expanding eligibility for lower income subsidy plans and price caps on annual out-of-pocket expenses, each of which could have potential pricing and reporting implications.

On June 6, 2023, Merck & Co. filed a lawsuit against the HHS and CMS asserting that, among other things, the IRA’s Drug Price Negotiation Program for Medicare constitutes an uncompensated taking in violation of the Fifth Amendment of the Constitution. Subsequently, a number of other parties, including the U.S. Chamber of Commerce, Bristol Myers Squibb Company, the PhRMA, Astellas, Novo Nordisk, Janssen Pharmaceuticals, Novartis, AstraZeneca and Boehringer Ingelheim, also filed lawsuits in various courts with similar constitutional claims against the HHS and CMS. HHS has generally won the substantive disputes in these cases, and various federal district court judges have expressed skepticism regarding the merits of the legal arguments being pursued by the pharmaceutical industry. Certain of these cases are now on appeal and, on October 30, 2024, the Court of Appeals for the Third Circuit heard oral argument in three of these cases. We expect that litigation involving these and other provisions of the IRA will continue, with unpredictable and uncertain results.

Accordingly, while it is currently unclear how the IRA will be effectuated, we cannot predict with certainty what impact any federal or state health reforms will have on us, but such changes could impose new or more stringent regulatory requirements on our activities or result in reduced reimbursement for our products, any of which could adversely affect our business, results of operations and financial condition.

Individual states in the United States have also become increasingly active in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures and, in some cases, designed to encourage importation from other countries and bulk purchasing. Legally-mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, results of operations, financial condition and prospects. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. This could reduce the ultimate demand for our product candidates or put pressure on our product pricing. This may be increasingly true with respect to products approved pursuant to the accelerated approval pathway. State Medicaid programs and other payers are developing strategies and implementing significant coverage barriers, or refusing to cover these products outright, arguing that accelerated approval drugs have insufficient or limited evidence despite meeting the FDA’s standards for accelerated approval.

We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action in the United States or any other jurisdiction. If we or any third parties we may engage are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we or such third parties are not able to maintain regulatory compliance, our product candidates may lose any regulatory approval that may have been obtained and we may not achieve or sustain profitability.

If the market opportunities for any product candidate that we or our strategic collaborators develop are smaller than we believe they are, our revenue may be adversely affected and our business may suffer.

We intend to initially focus our product candidate development on therapies for the treatment of serious diseases such as CML and obesity. Our projections of addressable patient populations that have the potential to benefit from treatment with our product candidates are based on estimates. These estimates have been derived from a variety of sources, including the scientific literature, surveys of clinics, patient foundations or market research, and may prove to be incorrect. Further, new studies may change the estimated incidence or prevalence of these diseases. The number of patients may turn out to be lower than expected. Additionally, the potentially addressable patient population for our product candidates may not ultimately be amenable to treatment with our product candidates. Our market opportunity may also be limited by future competitor treatments that enter the market. If any of our estimates are inaccurate, the market opportunities for any of our product candidates could be significantly diminished and have an adverse material impact on our business.

Our current and any future product candidates could be alleged to infringe patent rights and other intellectual property rights of third parties, which may require costly litigation and, if we are not successful, could cause us to pay substantial damages and/or limit our ability to commercialize our drugs and combination therapy candidates.

Our commercial success depends on our ability to develop, manufacture and market our current and any future product candidates that may be approved for sale and to use our proprietary technology without infringing the patents and other intellectual property rights of third parties. If any third-party patents or other intellectual property rights are found to cover our product candidates or their compositions, methods of use or manufacturing, we may be required to pay damages, which could be substantial, and we would not be free to manufacture or market our product candidates or to do so without obtaining a license, which may not be available on commercially reasonable terms, or at all. Regardless of merits, intellectual property disputes can be costly to defend, time-consuming and may cause our business, operating results and financial condition to suffer.

We operate in an industry with extensive intellectual property litigation. As the pharmaceutical, biopharmaceutical and biotechnology industries expand and more patents are issued, the risks increase that there may be patents issued to third parties that relate to our products and technology of which we are not aware or that we may need to challenge to continue our operations as currently contemplated. These risks may also increase because of the highly competitive therapeutic areas in which we are developing product candidates, in particular oncology and obesity, and the number of other companies pursuing new and innovative treatments for serious diseases in these areas, potentially resulting in various overlapping patent claims held by a number of different companies.

From time to time, we may be subject to legal proceedings and claims with respect to intellectual property relating to our product candidates and technologies we use in our business. The risks of being involved in such legal proceedings may increase as our product candidates advance in clinical development and near potential commercialization. We may face allegations that we have infringed the trademarks, copyrights, patents and other intellectual property rights of third parties, including patents held by our competitors or by non-practicing entities. For example, we are aware of patents and patent applications owned by third parties, some with broad claims, that such parties may assert cover our compounds currently in research and development. Litigation may make it necessary to defend ourselves by determining the scope, enforceability and validity of third-party proprietary rights, or to establish our proprietary rights. Interference or derivation proceedings provoked by third parties or brought by us or declared by the United States Patent and Trademark Office, or USPTO, may be necessary to determine the priority of inventions or establish proprietary rights with respect to our patents or patent applications or those of our licensors. Regardless of whether claims that we are infringing patents or other intellectual property rights have merit, the claims can be time consuming, divert management attention and financial resources and are costly to evaluate and defend. The legal threshold for initiating litigation or contested proceedings is low, so that even lawsuits or proceedings with a modest probability of success might be initiated against us. Results of any such litigation are difficult to predict and may prevent us from further developing, manufacturing, or commercializing the infringing product candidate or treating certain conditions, may require us to obtain licenses or modify our drugs or combination therapies and features while we develop non-infringing substitutes, or may result in significant settlement costs. For example, litigation can involve substantial damages for infringement, and if the court finds that the infringement was willful, we could be ordered to pay treble damages and the patent owner’s attorneys’ fees. We may also be prohibited from selling or licensing our product candidates unless the third party licenses rights to us, which it may not be required to do at a commercially reasonable price or at all. If a license is available from a third party, we may have to pay substantial

royalties or upfront fees or grant cross-licenses to intellectual property rights for our product candidates. Even if we were able to obtain a license, it could be non-exclusive, thereby giving competitors access to the same intellectual property or technologies licensed to us.

Although we have reviewed certain third-party patents and patent applications that we believe may be relevant to certain of our product candidates, we have not conducted a freedom-to-operate search or analysis for all of our product candidates. As such, we may not be aware of patents or pending or future patent applications that, if issued, would block us from commercializing our product candidates. We cannot guarantee that our product candidates, or our commercialization thereof, do not and will not infringe any third party’s intellectual property.

In addition, patent applications in the United States and many international jurisdictions are typically not published until 18 months after the filing of certain priority documents (or, in some cases, are not published until they issue as patents) and publications in the scientific literature often lag behind actual discoveries. Claims in patent applications can also be revised before issuance. Therefore, we cannot be certain that others have not filed patent applications or made public disclosures relating to our technology or our contemplated technology. A third party may have filed, and may in the future file, patent applications covering our product candidates or technology similar to ours. Any such patent application may have priority over our patent applications or patents, which could further require us to obtain rights to issued patents covering such technologies. If another party has filed a U.S. patent application on inventions similar to ours, depending on whether the timing of the filing date falls under certain patent laws, we may have to participate in a priority contest (such as an interference proceeding) declared by the USPTO to determine priority of invention in the United States. The costs of patent litigation and other proceedings could be substantial, and it is possible that such efforts would be unsuccessful if it is determined that the other party had independently arrived at the same or similar invention prior to our own invention, resulting in a loss of our U.S. patent position with respect to such invention.

The coverage of patents is subject to interpretation by the courts, and the interpretation is not always uniform. If we were sued for patent infringement, we would need to demonstrate that our product candidates either do not infringe the patent claims of the relevant patent or that the patent claims are invalid or unenforceable, and we may not be successful in doing so. Proving invalidity or unenforceability is difficult. For example, in the United States, proving invalidity requires a showing of clear and convincing evidence to overcome the presumption of validity enjoyed by issued patents. Even if we believe third-party intellectual property claims are without merit, there is no assurance that a court would find in our favor on questions of infringement, validity, or enforceability.

Some of our competitors may be able to sustain the costs of complex patent litigation more effectively or dedicate substantially greater resources to prosecuting legal actions than we can. 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. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a material adverse effect on the price of our common stock. Any uncertainties resulting from the actual or potential initiation and continuation of any litigation, regardless of merit, could have a material adverse effect on our ability to finance our continuing operations or to support our research and development activities for a particular product candidate, whether through public or private equity offerings, debt financings or other sources, such as license transactions or strategic collaborations.

There can be no assurance with respect to the outcome of any future litigation brought by or against us, and the outcome of any such litigation could have a material adverse impact on our business, operating results and financial condition. Litigation is inherently unpredictable, and outcomes are uncertain. Further, as the costs and outcome of these types of claims and proceedings can vary significantly, it is difficult to estimate potential losses that may occur. Such claims and proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately. Accordingly, we are unable at this time to estimate the effects of these potential future lawsuits on our financial condition, operations or cash flows.

We may be subject to claims by employees, consultants and contractors claiming ownership of what we regard as our own intellectual property.

While it is our policy to require our employees, consultants and contractors who may be involved in the conception or development of intellectual property to execute agreements assigning such intellectual property to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own, which may result in claims by or against us related to the ownership of such intellectual property. In addition, such agreements may not be self-executing such that the intellectual property subject to such agreements may not be assigned to us without additional assignments being executed, and we may fail to obtain such assignments. In addition, such agreements may be breached. Accordingly, we may be forced to bring claims against third parties, or defend claims that they may bring against us to determine the ownership of what we regard as our intellectual property. If we fail in prosecuting or defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property. Even if we are successful in prosecuting or defending against such claims, litigation could result in substantial costs and be a distraction to our senior management and scientific personnel, which would have a material adverse effect on our business, financial condition, results of operations and prospects.

If we are unable to obtain, maintain and enforce intellectual property protection directed to our current and any future technologies that we develop, others may be able to make, use or sell products substantially the same as ours, which could adversely affect our ability to compete in the market.

The market for pharmaceuticals and biopharmaceuticals is highly competitive and subject to rapid technological change. Our success depends, in part, upon our ability to maintain a competitive position in the development and protection of technologies and any future product candidates for use in these fields and upon our ability to obtain, maintain and enforce our intellectual property rights. We seek to obtain and maintain patents and other intellectual property rights to restrict the ability of others to market products that misappropriate our technology and/or infringe our intellectual property to unfairly and illegally compete with any of our product candidates. If we are unable to protect our intellectual property and proprietary rights, our competitive position and our business could be harmed, as third parties may be able to make, use or sell products that are substantially the same as any product candidates we may sell without incurring the sizeable development and, in some cases, licensing costs that we have incurred, which would adversely affect our ability to compete in the market. We use a combination of patents, trademarks, know-how, confidentiality procedures and contractual provisions to protect our proprietary technology and that of our licensors. However, these protections may not be adequate and may not provide us with any competitive advantage. For example, patents may not issue from any of our or our licensors’ currently pending or any future patent applications, and our or our licensors’ issued patents and any future patents that may issue may not survive legal challenges to their scope, validity or enforceability or provide significant protection for us.

To protect our proprietary position, we generally file patent applications in the United States and in certain foreign countries related to our product candidates that we consider important to our business. The patent application and approval process is expensive, time-consuming and complex. We may not be able to file, prosecute and maintain all necessary or desirable patent applications at a reasonable cost or in a timely manner or in all jurisdictions. It is also possible that we will fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection. Moreover, depending on the terms of any future license or collaboration agreements to which we may become a party, we may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology licensed from third parties. Therefore, these patents and patent applications may not be prosecuted and enforced in a manner consistent with the best interests of our business.

Furthermore, the patent position of biotechnology and pharmaceutical companies generally is highly uncertain. No consistent policy regarding the breadth of claims allowed in biotechnology and pharmaceutical patents has emerged to date in the United States or in many foreign jurisdictions. The standards applied by the USPTO and foreign patent offices in granting patents are not always applied uniformly or predictably. In addition, the determination of patent rights with respect to biological and pharmaceutical products commonly involves complex legal and factual questions, which have in recent years been the subject of much litigation. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights are highly uncertain. Thus, we cannot offer any assurances about which, if any, patents will issue, the breadth of any such patents, whether any issued patents will be found invalid and unenforceable or will be threatened by third parties or whether any issued patents will effectively prevent others from commercializing competing technologies and product candidates.

The USPTO, international patent offices or judicial bodies may deny or significantly narrow claims made under our patent applications, and our issued patents may be successfully challenged, may be designed around or may otherwise be of insufficient scope to provide us with protection for our drugs or combination therapies. Further, the USPTO, international trademark offices or judicial bodies may deny our trademark applications and, even if published or registered, these trademarks may not effectively protect our brand and goodwill. Like patents, trademarks also may be successfully opposed or challenged.

We cannot be certain that the steps we have taken will prevent unauthorized use or unauthorized reverse engineering of our technology. Moreover, third parties may independently develop technologies that are competitive with ours and such competitive technologies may or may not infringe our intellectual property. The enforcement of our intellectual property rights also depends on the success of any legal actions we may take against these infringers in the respective country or forum, but these actions may not be successful. As with all granted intellectual property, such intellectual property may be challenged, invalidated or circumvented, may not provide protection and/or may not prove to be enforceable in actions against specific alleged infringers.

Even if our patents are determined by a court to be valid and enforceable, they may not be interpreted sufficiently broadly to prevent others from marketing products similar to ours or designing around our patents. For example, third parties may be able to make products that are similar to ours but that are not covered by the claims of our patents. Third parties may assert that we or our licensors were not the first to make the inventions covered by our issued patents or pending patent applications. The claims of our or our licensors’ issued patents or patent applications when issued may not cover our product candidates or any future products that we develop. We may not have freedom to commercialize unimpeded by the patent rights of others. Third parties may have patents that dominate, block or are otherwise relevant to our technology. There may be prior public disclosures or other art that could be deemed to invalidate one or more of our patent claims. Further, we may not develop additional proprietary technologies in the future, and, if we do, they may not be patentable.

We may not be able to correctly estimate or control our future operating expenses in relation to obtaining intellectual property, enforcing intellectual property and/or defending intellectual property, which could affect operating expenses. Our operating expenses may fluctuate significantly in the future as a result of a variety of factors, including the costs of preparing, filing, prosecuting, defending and enforcing patent and trademark claims and other intellectual property-related costs, including adverse proceedings and litigation costs.

We may be involved in lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time consuming and unsuccessful. Further, our issued patents could be found invalid or unenforceable if challenged in court.

Competitors may infringe our intellectual property rights or those of our licensors. To prevent infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time-consuming. In addition, in a patent infringement proceeding, a court may decide that one or more patent of ours or any of our current licensors or future licensors is not valid or is unenforceable, in whole or in part, or may refuse to stop the other party from using the technology at issue on the grounds that our or our licensors’ patents do not cover the technology in question. An adverse result in any litigation or defense proceedings could put one or more of our or our licensors’ patents at risk of being invalidated or interpreted narrowly, which may curtail or preclude our ability to exclude third parties from making and selling similar or competitive products, and could put our or our licensors’ patent applications at risk of not issuing. If we or any of our potential future collaborators were to initiate legal proceedings against a third party to enforce a patent directed at our products, the defendant could counterclaim that our or our licensors’ patent is invalid and/or unenforceable in whole or in part. In patent litigation in the United States, defendant counterclaims alleging invalidity and/or unenforceability are commonplace. Grounds for a validity challenge include an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement. Grounds for an unenforceability assertion could also include an allegation that someone connected with prosecution of the patent withheld relevant information from the USPTO or made a misleading statement during prosecution. Third parties may also raise similar validity claims before the USPTO in post-grant proceedings such as ex parte reexaminations, inter partes review or post-grant review, or oppositions or similar proceedings outside the United States, in parallel with litigation or even outside the context of litigation.

If a defendant were to prevail on a legal assertion of invalidity or unenforceability of our or our licensors’ patents covering one of our product candidates, we could lose a part, and perhaps all, of the patent protection covering such candidate. Competing products may also be sold in other countries in which our patent coverage might not exist or be as strong. If we lose a foreign patent lawsuit, alleging our infringement of a competitor’s patents, we could be prevented from marketing our products in one or more foreign countries. Any of these occurrences could adversely affect our competitive business position, business prospects and financial condition.

The outcome following legal assertions of invalidity and unenforceability is unpredictable, and prior art could render our patents or those of our licensors invalid. Similar mechanisms for challenging the validity and enforceability of a patent exist in ex-U.S. patent offices and may result in the revocation, cancellation, or amendment of any ex-U.S. patents we hold in the future. For the patents and patent applications that we may license in the future, we may have limited or no right to participate in the defense of any licensed patents against challenge by a third party. If a defendant were to prevail on a legal assertion of invalidity and/or unenforceability, we would lose at least part, and perhaps all, of the patent protection on such product candidate. Such a loss of patent protection would have a material adverse impact on our business.

Even if we establish infringement, the court may decide not to grant an injunction against further infringing activity and instead award only monetary damages, which may or may not be an adequate remedy. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. There could also be public announcements of the results of hearings, motions or other interim proceedings or developments. If securities analysts or investors perceive these results to be negative, it could have a material adverse effect on the price of our common stock.

We may not be able to prevent, alone or with our potential licensors, misappropriation of our intellectual property rights, particularly in countries where the laws may not protect those rights as fully as in the United States.

Our defense of litigation or interference or other intellectual property proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees. An unfavorable outcome could require us to cease using the related technology or to attempt to license rights to it from the prevailing party. Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms or at all, or if a non-exclusive license is offered and our competitors gain access to the same technology. In addition, the uncertainties associated with litigation could have a material adverse effect on our ability to raise the funds necessary to continue our clinical trials, continue our research programs, license necessary technology from third parties or enter into development or manufacturing partnerships that would help us bring our products to market.

We license or otherwise have access to patent rights from third-party owners. Such licenses or other arrangements may be subject to early termination if we fail to comply with our obligations in our agreements with third parties, which could result in the loss of rights or technology that are material to our business.

We are a party to licenses and other agreements that give us rights to third-party intellectual property that are necessary or useful for our business, and we may enter into additional licenses or other agreements in the future. For example, we are party to an assignment agreement with Vintagence Biotechnology Ltd. with respect to our THR-β program. Under these agreements, we are obligated to pay the counterparties fees, which may include annual license fees, milestone payments, royalties, a percentage of revenues associated with the applicable technology and a percentage of sublicensing revenue. In addition, under certain of such agreements, we are required to diligently pursue the development of products using the applicable technology. If we fail to comply with these obligations and fail to cure our breach within a specified period of time, the counterparty may have the right to terminate the applicable agreement, in which event we could lose valuable rights and technology that are material to our business.

We may rely on third parties from whom we license proprietary technology to file and prosecute patent applications and maintain patents and otherwise protect the intellectual property we license from them. We may have limited control over these activities or any other intellectual property that may be related to our in-licensed intellectual property. For example, we cannot be certain that such activities by these licensors will be conducted in compliance with applicable laws and regulations or will result in valid and enforceable patents and other intellectual property rights. We may have limited control over the manner in which our licensors initiate an infringement proceeding against a third-party infringer of the intellectual property rights, or defend certain of the intellectual property that may be licensed to us. It is possible that the licensors’ infringement proceeding or defense activities may be less vigorous than if we conduct them ourselves.

Our intellectual property agreements with third parties may be subject to disagreements over contract interpretation, which could narrow the scope of our rights to the relevant intellectual property or technology or increase our financial or other obligations to our licensors.

Certain provisions in our intellectual property agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could affect the scope of our rights to the relevant intellectual property or technology, or affect financial or other obligations under the relevant agreement, any of which could have a material adverse effect on our business, financial condition, results of operations and prospects.

We may jointly own certain patent rights with third parties. Our ability to out-license these patent rights, or to prevent the third party from out-licensing these patent rights, may be limited in certain countries.

We may jointly own patents and patent applications with third parties in the future. Unless we enter into an agreement with the joint owner, we will be subject to certain default rules pertaining to joint ownership. Certain countries require the consent of all joint owners to license jointly owned patents, and if we are unable to obtain such consent from the joint owner, we may not be able to license our rights under these patents and patent applications. In certain other countries, including the United States, the joint owner could license its rights under these patents and patent applications to another party without our consent and without any duty of accounting to us.

We may in the future be dependent on intellectual property licensed or sublicensed to us from, or for which development was funded or otherwise assisted by, government agencies, such as the National Institutes of Health, for development of our technology and product candidates. Failure to meet our own obligations to our licensors or upstream licensors, including such government agencies, may result in the loss of our rights to such intellectual property, which could harm our business.

In the future, government agencies may provide funding, facilities, personnel or other assistance in connection with the development of the intellectual property rights owned by or licensed to us. Such government agencies may retain rights in such intellectual property, including the right to grant or require us to grant mandatory licenses or sublicenses to such intellectual property to third parties under certain specified circumstances, including if it is necessary to meet health and safety needs that we are not reasonably satisfying or if it is necessary to meet requirements for public use specified by federal regulations, or to manufacture products in the United States. Any exercise of such rights, including with respect to any such required sublicense of these licenses could result in the loss of significant rights and could harm our ability to commercialize licensed products.

We may be subject to claims challenging the inventorship or ownership of our patents and other intellectual property.

We may be subject to claims that former employees, collaborators, or other third parties have an interest in our patents or other intellectual property as an inventor or co-inventor or owner. The failure to name the proper inventors on a patent application can result in the patents issuing thereon being unenforceable. Inventorship disputes may arise from conflicting views regarding the contributions of different individuals named as inventors, the effects of foreign laws where foreign nationals are involved in the development of the subject matter of the patent, conflicting obligations of third parties involved in developing our product candidates or as a result of questions regarding co-ownership of potential joint inventions. For example, we may have inventorship disputes arise from conflicting obligations of consultants or others who are involved in developing our product candidates. Alternatively, or additionally, we may enter into agreements to clarify the scope of our rights in such intellectual property. Litigation may be necessary to defend against these and other claims challenging inventorship and/or ownership. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, such as exclusive ownership of, or right to use, valuable intellectual property. Such an outcome could have a material adverse effect on our business. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

We or our licensors may in the future rely on third-party consultants or collaborators or on funds from third parties, such as the U.S. government, such that we or our licensors are not the sole and exclusive owners of the patents we in-licensed. If other third parties have ownership rights or other rights to our patents, including in-licensed patents, they may be able to license such patents to our competitors, and our competitors could market competing products and technology. This could have a material adverse effect on our competitive position, business, financial conditions, results of operations and prospects.

We may be subject to claims that we have wrongfully hired an employee from a competitor or that we or our employees have wrongfully used or disclosed alleged confidential information or trade secrets of their former employers.

As is common in the pharmaceutical and biotechnology industries, in addition to our employees, we engage the services of consultants to assist us in the development of our product candidates. Many of these consultants, and many of our employees, were previously employed at, or may have previously provided or may be currently providing consulting services to, universities or other pharmaceutical or biotechnology companies including our competitors or potential competitors. These employees and consultants may have executed proprietary rights, non-disclosure and non-competition agreements, or similar agreements, in connection with such other current or previous employment. Although we try to ensure that our employees and consultants do not use the proprietary information or know-how of others in their work for us and seek assurances that they will not, we may become subject to claims that we, our employees or a consultant inadvertently or otherwise used or disclosed trade secrets or other information proprietary to their former employers or their former or current clients. Litigation may be necessary to defend against these claims. If we fail in successfully defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, which could adversely affect our business. Such intellectual property could be awarded to a third party, and we could be required to obtain a license from such third party to commercialize our technology or drugs and combination therapies. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to our management team. Any of the foregoing would have a material adverse effect on our business, financial condition, results of operations and prospects.

We may not be able to protect our intellectual property rights throughout the world.

We have a number of patents and patent applications in foreign countries, and expect to continue to pursue patent protection in many of the significant markets in which we intend to do business. However, filing, prosecuting and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and the laws of some foreign countries do not protect intellectual property rights to the same extent as federal and state laws in the United States. The requirements for patentability may differ in certain countries, particularly in developing countries. In addition, any future intellectual property license agreements may not always include worldwide rights. Consequently, we have not pursued or maintained, and may not pursue or maintain in the future, patent protection for our product candidates in every country or territory in which we may sell our drugs and combination therapies and we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our inventions in and into the United States or other jurisdictions. Competitors may use our technologies in jurisdictions where we have not obtained or maintained patent protection to develop their own products, and may export otherwise infringing products to territories where we have patent protection but enforcement is not as strong as that in the United States and where our ability to enforce our patents to stop infringing activities may be inadequate. These products may compete with any current or future product candidates we may sell, and our patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.

Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protections, particularly those relating to pharmaceuticals and biopharmaceuticals, which could make it difficult for us to stop the infringement of our patents or the marketing of competing products in violation of our proprietary rights generally.

Moreover, our ability to protect and enforce our intellectual property and proprietary rights may be adversely affected by unforeseen changes in foreign intellectual property laws. Additionally, the laws of some countries outside of the United States and Europe do not afford intellectual property protection to the same extent as the laws of the United States and Europe. Many companies have encountered significant problems in protecting and defending intellectual property and proprietary rights in certain foreign jurisdictions. The legal systems of some countries, including, for example, India, the PRC, and other developing countries, do not favor the enforcement of patents and other intellectual property or proprietary rights, particularly those relating to biotechnology products, which could make it difficult for us to stop the infringement, misappropriation or other violation of our patents or other intellectual property or proprietary rights. For example, many foreign countries have compulsory licensing laws under which a patent owner must grant licenses to third parties. Consequently, we may not be able to prevent third parties from practicing our inventions in certain countries outside the United States and Europe. In addition, many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent. If we are forced to grant a license to third parties with respect to any patents relevant to our business, our competitive position may be impaired, and our business, financial condition, results of operations and prospects may be adversely affected.

Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license.

We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent, which might adversely affect our ability to develop and market our single-agent and combination therapies.

We cannot guarantee that any of our patent searches or analyses, including the identification of relevant patents or patent applications, the scope of patent claims or the expiration of relevant patents, are complete or thorough, nor can we be certain that we have identified each and every third-party patent and pending patent application in the United States and abroad that is relevant to or necessary for the commercialization of our product candidates in any jurisdiction. The scope of a patent claim is determined by an interpretation of the law, the written disclosure in a patent and the patent’s prosecution history. Our interpretation of the relevance or the scope of a patent or a pending patent application may be incorrect, which may negatively impact our ability to market our product candidates. We may incorrectly determine that our product candidates are not covered by a third-party patent or may incorrectly predict whether a third-party’s pending patent application will issue with claims of relevant scope. Our determination of the expiration date of any patent in the United States or abroad that we consider relevant may be incorrect, which may negatively impact our ability to develop and market our product candidates. Our failure to identify and correctly interpret relevant patents or patent applications may negatively impact our ability to develop and market our product candidates.

One aspect of the determination of patentability of our inventions depends on the scope and content of the “prior art,” information that was or is deemed available to a person of skill in the relevant art prior to the priority date of the claimed invention. There may be prior art of which we are not aware that may affect the patentability of our patent claims or, if issued, affect the validity or enforceability of a patent claim. Further, we may not be aware of all third-party intellectual property rights potentially relating to our product candidates or their intended uses, and as a result the impact of such third-party intellectual property rights upon the patentability of our own patents and patent applications, as well as the impact of such third-party intellectual property upon our freedom to operate, is highly uncertain. Because patent applications in the United States and most other countries are confidential for typically a period of 18 months after filing, or may not be published at all, we cannot be certain that we were the first to file any patent application related to our product candidates. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights are highly uncertain. Furthermore, for U.S. applications in which all claims are entitled to a priority date before March 2013, an interference proceeding can be provoked by a third party or instituted by the USPTO to determine who was the first to invent any of the subject matter covered by the patent claims of our applications. For U.S. patents and patent applications containing a claim not entitled to priority before March 2013, there is a greater level of uncertainty in the patent law in view of the passage of the Leahy-Smith America Invents Act, or the AIA, which brought into effect significant changes to the U.S. patent laws, including new procedures for challenging pending patent applications and issued patents.

Patent terms may be inadequate to establish our competitive position on our product candidates for an adequate amount of time.

Patents have a limited lifespan. In the United States, if all maintenance fees are timely paid, the natural expiration of a patent is generally 20 years from its earliest effective non-provisional filing date. Patent terms may be shortened or lengthened by, for example, terminal disclaimers, patent term adjustments, supplemental protection certificates and patent term extensions, but the life of a patent, and the protection it affords, is limited. Non-payment or delay in payment of patent fees, maintenance fees or annuities, delay in patent filings or delay in extension filings (including any patent term extension or adjustment filings), whether intentional or unintentional, may result in the loss of patent rights important to our business. Even if patents covering our product candidates are obtained, once the patent life has expired for a product candidate, we may be open to competition from competitive medications, including generic versions. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents directed towards such product candidates might expire before or shortly after such product candidates are commercialized. As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing product candidates similar or identical to ours for a meaningful amount of time, or at all.

Depending upon the timing, duration and conditions of any FDA marketing approval of our product candidates, one or more of our owned or licensed U.S. patents may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984, or Hatch-Waxman Act and similar legislation in the EU and certain other jurisdictions. The Hatch-Waxman Act permits, in certain cases, a patent term extension of up to five years for a patent covering an approved product as compensation for effective patent term lost during product development and the FDA regulatory review process. However, we may not receive an extension if we fail to exercise due diligence during the testing phase or regulatory review process, fail to apply within applicable deadlines, fail to apply prior to expiration of relevant patents or otherwise fail to satisfy applicable requirements. Moreover, the length of the extension could be less than we request. Only one patent per approved product can be extended, the extension cannot extend the total patent term beyond 14 years from approval, and the amount of available extension to any extension-eligible patent which claims a product, a method of using a product or a method of manufacturing a product, depends on a variety of factors, including the date on which the patent issues and certain dates related to the regulatory review period. If we are unable to obtain patent term extension or the term of any such extension is less than we request, the period during which we can enforce our patent rights for the applicable product candidate will be shortened and our competitors may obtain approval to market competing products sooner. As a result, our revenue from applicable products could be reduced. Further, if this occurs, our competitors may take advantage of our investment in development and trials by referencing our clinical and nonclinical data and launch their product earlier than might otherwise be the case, and our competitive position, business, financial condition, results of operations and prospects could be materially harmed.

Further, there are detailed rules and requirements regarding the patents that may be submitted to the FDA for listing in the Orange Book. We may be unable to obtain patents covering our product candidates that contain one or more claims that satisfy the requirements for listing in the Orange Book. Even if we submit a patent for listing in the Orange Book, the FDA may decline to list the patent, or a manufacturer of generic drugs may challenge the listing. If one of our product candidates is approved and a patent covering that product candidate is not listed in the Orange Book, a manufacturer of generic drugs would not have to provide advance notice to us of any abbreviated new drug application filed with the FDA to obtain permission to sell a generic version of such product candidate. Any of the foregoing could harm our competitive position, business, financial condition, results of operations and prospects.

Obtaining and maintaining patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.

The USPTO and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other provisions during the patent process. Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and/or patent applications will be due to be paid to the USPTO and various governmental patent agencies outside of the United States in several stages over the lifetime of the patents and/or patent applications. We employ reputable professionals and rely on such third parties to help us comply with these requirements and effect payment of these fees with respect to the patents and patent applications that we own, and we may have to rely upon our licensors to comply with these requirements and effect payment of these fees with respect to any patents and patent applications that we license. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. However, there are situations in which noncompliance can result in abandonment or lapse of a patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, competitors might be able to enter the market earlier than would otherwise have been the case.

Changes in patent law in the United States or in other countries could diminish the value of patents in general, thereby impairing our ability to protect our product candidates.

As is the case with other pharmaceutical companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining and enforcing patents in the pharmaceutical industry involves both technological and legal complexity and is therefore costly, time consuming and inherently uncertain. Our patent rights may be affected by developments or uncertainty in U.S. or ex-U.S. patent statutes, patent case laws in USPTO rules and regulations or in the rules and regulations of ex-U.S. patent offices. There are a number of changes to the U.S. patent laws that may have a significant impact on our ability to protect our technology and enforce our intellectual property rights. For example, in September 2011, the AIA, was signed into law. The AIA includes provisions that affect the way patent applications are prosecuted and affect patent litigation. In particular, under the AIA, the United States transitioned in March 2013 to a “first to file” system in which the first inventor to file a patent application is entitled to the patent. Third parties are allowed to submit prior art before the issuance of a patent by the USPTO, and may become involved in post-grant proceedings including opposition, derivation, reexamination, inter partes review or interference proceedings challenging our patent rights or the patent rights of others. An adverse determination in any such submission, proceeding or litigation could reduce the scope or enforceability of, or invalidate, our patent rights, which could adversely affect our competitive position. This could have a negative impact on some of our intellectual property and could increase uncertainties surrounding obtaining and enforcement or defense of our issued patents.

In addition, Congress may pass patent reform legislation that is unfavorable to us. The U.S. Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents once obtained. Depending on decisions by Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce our existing patents and patents we might obtain in the future. Similarly, statutory or judicial changes to the patent laws of other countries may increase the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents. We cannot predict future changes in the interpretation of patent laws or changes to patent laws that might be enacted into law by U.S. and international legislative bodies. Those changes may materially affect the patents and patent applications of our licensors, our existing or future patents and patent applications and our ability to obtain additional patents in the future.

If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed.

We rely on the protection of our trade secrets, including unpatented know-how, technology and other proprietary information. We have taken steps to protect our trade secrets and unpatented know-how, including entering into confidentiality agreements with third parties, and confidential information and inventions agreements with employees, consultants and advisors. Despite these efforts, we cannot provide any assurances that all such agreements have been duly executed, and any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. In addition to contractual measures, we try to protect the confidential nature of our proprietary information using commonly accepted physical and technological security measures. Even though we use commonly accepted security measures, the criteria for protection of trade secrets can vary among different jurisdictions. Additionally, such security measures may not provide adequate protection for our proprietary information, for example, in the case of misappropriation of a trade secret by an employee, consultant, customer or third party with authorized access. Recourse we take against such misconduct may not provide an adequate remedy to fully protect our interests. Monitoring unauthorized uses and disclosures is difficult, and we do not know whether the steps we have taken to protect our proprietary technologies will be effective. Unauthorized parties may also attempt to copy or reverse engineer certain aspects of our product candidates that we consider proprietary.

Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and the outcome is unpredictable. In addition, some courts inside and outside the United States are less willing or unwilling to protect trade secrets. Moreover, third parties may still obtain this information or may come upon this or similar information independently, and we would have no right to prevent them from using that technology or information to compete with us. Trade secrets will over time be disseminated within the industry through independent development, the publication of journal articles and the movement of personnel skilled in the art from company to company or academic to industry scientific positions. Though our agreements with third parties typically restrict the ability of our advisors, employees, collaborators, licensors, suppliers, third-party contractors and consultants to publish data potentially relating to our trade secrets, our agreements may contain certain limited publication rights. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent such competitor from using that technology or information to compete with us, which could harm our competitive position. Because from time to time we expect to rely on third parties in the development, manufacture and distribution of our product candidates, we must, at times, share trade secrets with them. Despite employing the contractual and other security precautions described above, the need to share trade secrets increases the risk that such trade secrets become known by our competitors, are inadvertently incorporated into the technology of others, or are disclosed or used in violation of these agreements. If any of these events occurs or if we otherwise lose protection for our trade secrets, the value of this information may be greatly reduced and our competitive position would be harmed. If we do not apply for patent protection prior to such publication or if we cannot otherwise maintain the confidentiality of our proprietary technology and other confidential information, then our ability to obtain patent protection or to protect our trade secret information may be jeopardized.

If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected.

Our current or future trademarks or trade names may be challenged, infringed, circumvented or declared generic or descriptive determined to be infringing on other marks. We may not be able to protect our rights to these trademarks and trade names or may be forced to stop using these names, which we need for name recognition by potential partners or customers in our markets of interest. During trademark registration proceedings, we may receive rejections of our applications by the USPTO or in other foreign jurisdictions. Although we would be given an opportunity to respond to those rejections, we may be unable to overcome such rejections. In addition, in the USPTO and in comparable agencies in many foreign jurisdictions, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks. Opposition or cancellation proceedings may be filed against our trademarks, and our trademarks may not survive such proceedings. If we are unable to establish name recognition based on our trademarks and trade names, we may not be able to compete effectively and our business may be adversely affected. We may license our trademarks and trade names to third parties, such as distributors. Though these license agreements may provide guidelines for how our trademarks and trade names may be used, a breach of these agreements or misuse of our trademarks and tradenames by our licensees may jeopardize our rights in or diminish the goodwill associated with our trademarks and trade names.

Moreover, any name we have proposed to use with our product candidates in the United States must be approved by the FDA, regardless of whether we have registered it, or applied to register it, as a trademark. Similar requirements exist in Europe. The FDA typically conducts a review of proposed product names, including an evaluation of potential for confusion with other product names. If the FDA (or an equivalent administrative body in a foreign jurisdiction) objects to any of our proposed proprietary single-agent or combination therapy names, it may be required to expend significant additional resources in an effort to identify a suitable substitute name that would qualify under applicable trademark laws, not infringe the existing rights of third parties and be acceptable to the FDA. Furthermore, in many countries, owning and maintaining a trademark registration may not provide an adequate defense against a subsequent infringement claim asserted by the owner of a senior trademark. At times, competitors or other third parties may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion. In addition, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names. If we assert trademark infringement claims, a court may determine that the marks we have asserted are invalid or unenforceable, or that the party against whom we have asserted trademark infringement has superior rights to the marks in question. In this case, we could ultimately be forced to cease use of such trademarks.

Intellectual property rights 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. For example:

Should any of these events occur, they could significantly harm our business, results of operations and prospects.

If we fail to attract and retain senior management and key scientific personnel or if we lose our personnel for health or other reasons, our business may be materially and adversely affected.

Our success depends in part on our continued ability to attract, retain and motivate highly qualified management and clinical and scientific personnel. We are highly dependent upon members of our senior management team and our senior scientists. The loss of services of any of these individuals could delay or prevent the successful development of our pipeline, initiation or completion of our planned clinical trials or the commercialization of our current or future product candidates.

Competition for qualified personnel in the pharmaceutical, biopharmaceutical and biotechnology field is intense due to the limited number of individuals who possess the knowledge, skills and experience required by our industry. We will need to hire additional personnel as we expand our clinical development and, if we initiate commercial activities, establish newly created roles at the leadership and operational levels. We may not be able to attract and retain quality personnel on acceptable terms, or at all. In addition, to the extent we hire personnel from competitors, we may be subject to allegations that they have been improperly solicited or that they have divulged proprietary or other confidential information, or that their former employers own their research output.

We will need to increase the size of our organization, and we may experience difficulties in managing growth.

As of December 31, 2024, we had 59 full-time employees. We will need to continue to expand our managerial, operational, finance and other resources to manage our operations and clinical trials, continue our development activities and, if approved, commercialize our preclinical and clinical-stage product candidates or any future product candidates. Our management and personnel, systems and facilities currently in place may not be adequate to support this future growth. Our need to effectively execute our growth strategy requires that we:

Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.

Our amended and restated certificate of incorporation and amended and restated bylaws provide that we will indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law.

In addition, as permitted by Section 145 of the Delaware General Corporation Law, our amended and restated bylaws and our indemnification agreements that we have entered into with our directors and officers provide that:

While we maintain a directors’ and officers’ insurance policy, such insurance may not be adequate to cover all liabilities that we may incur, which may reduce our available funds to satisfy third-party claims and may adversely impact our cash position.

If product liability lawsuits are brought against us, we may incur substantial liabilities and may be required to limit commercialization of our current or future product candidates.

We face an inherent risk of product liability as a result of the clinical testing of our product candidates and will face an even greater risk if we commercialize any single-agent or combination therapies. For example, we may be sued if any drug we develop allegedly causes injury or is found to be otherwise unsuitable during clinical testing, manufacturing, marketing or sale. Any such product liability claims may include allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product, negligence, strict liability and breach of warranty. Claims could also be asserted under state consumer protection acts. If we cannot successfully defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization of our product candidates. Even a successful defense would require significant financial and management resources. Regardless of the merits or eventual outcome, liability claims may result in:

If we are unable to obtain and maintain sufficient product liability insurance at an acceptable cost and scope of coverage to protect against potential product liability claims, the commercialization of our current or any future product candidates we develop could be inhibited or prevented. We currently carry product liability insurance covering our clinical trials. Although we maintain such insurance, any claim that may be brought against us could result in a court judgment or settlement in an amount that is not covered, in whole or in part, by our insurance or that is in excess of the limits of our insurance coverage. Our insurance policies also have various exclusions and deductibles, and we may be subject to a product liability claim for which we have no coverage. We will have to pay any amounts awarded by a court or negotiated in a settlement that exceed our coverage limitations or that are not covered by our insurance, and we may not have, or be able to obtain, sufficient funds to pay such amounts.

Moreover, insurance laws vary significantly from country to country, and many countries require insurance to be approved by regulators of the respective country. As such, our existing insurance policies might not meet the requirements of a global trial, which could cause significant delays in our clinical trials and related business objectives. Additionally, we may not be able to maintain insurance coverage at a reasonable cost or in sufficient amounts to protect us against losses. If and when we obtain approval for marketing any of our product candidates, we intend to expand our insurance coverage to include the sale of such product candidate; however, we may be unable to obtain this liability insurance on commercially reasonable terms or at all.

As a company with some operations and vendors located outside of the United States, our business is subject to economic, political, regulatory and other risks associated with international operations.

As a company with some operations and vendors outside of the United States, including our outsourced manufacturing vendors, our business is subject to risks associated with conducting business outside the United States. Accordingly, our future results could be harmed by a variety of factors, including:

See “—Risks Related to Doing Business in China” for additional risks related to our operations in China.

Our business involves the use of hazardous materials, and we and our suppliers must comply with environmental laws and regulations, which can be expensive and restrict how we do business.

Our research and development activities and our third-party suppliers’ activities involve the controlled storage, use and disposal of hazardous materials owned by us, including the components of our product candidates and other hazardous compounds. We and any third-party manufacturers and suppliers are subject to numerous federal, state and local environmental, health and safety laws, regulations and permitting requirements, including those governing laboratory procedures; the generation, handling, use, storage, treatment and disposal of hazardous and regulated materials and wastes; the emission and discharge of hazardous materials into the ground, air and water; and employee health and safety. Our operations and those of our third-party manufacturers and CROs involve the use of hazardous and flammable materials, including chemicals and biological and radioactive materials. Our operations and those of our third-party manufacturers and CROs also produce hazardous waste. In some cases, these hazardous materials and various wastes resulting from their use are stored at our and our manufacturers’ and CROs’ facilities pending their use and disposal. We generally contract with third parties for the disposal of these materials and wastes. We cannot eliminate the risk of contamination, which could cause an interruption of our commercialization efforts, research and development efforts and business operations and environmental damage resulting in costly clean-up and liabilities under applicable laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products.

We cannot guarantee that the safety procedures utilized by our third-party manufacturers and CROs for handling and disposing of these materials comply with the standards prescribed by these laws and regulations, nor can we eliminate the risk of accidental contamination or injury from these materials. Under certain environmental laws, we could be held responsible for costs relating to any contamination at our current or past facilities and at third-party facilities. In such an event, we may be held liable for any resulting damages and such liability could exceed our resources, and state or federal or other applicable authorities may curtail our use of certain materials and/or interrupt our business operations. Furthermore, environmental laws and regulations are complex, change frequently and have tended to become more stringent. We cannot predict the impact of such changes and cannot be certain of our future compliance.

Compliance with applicable environmental laws and regulations change regularly and may be expensive and difficult to execute effectively, and current or future environmental laws and regulations may impair our research and product development efforts. In addition, we cannot entirely eliminate the risk of accidental injury or contamination from hazardous materials or wastes. Although we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not carry specific biological or hazardous waste insurance coverage, and our property, casualty and general liability insurance policies specifically exclude coverage for damages and fines arising from biological or hazardous waste exposure or contamination. 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, which could have a material adverse effect on our business, results of operations and financial condition.

Actual or perceived failures to comply with applicable data protection, privacy and security laws, regulations, standards and other requirements could adversely affect our business, financial condition, results of operations and prospects.

The global data protection landscape is rapidly evolving, and we and our partners and vendors are or may become subject to various federal, state and foreign laws, regulations and requirements governing the collection, use, disclosure, retention and security of personal information, such as information that we may collect in connection with clinical trials. Implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future, and we cannot yet determine the impact future laws, regulations, standards, or perception of their requirements may have on our business. This evolution may create uncertainty in our business, affect our ability to operate in certain jurisdictions or to collect, store, transfer use and share personal information, necessitate the acceptance of more onerous obligations in our contracts, result in liability or impose additional costs on us. The cost of compliance with these laws, regulations and standards is high and is likely to increase in the future. Any failure or perceived failure by us to comply with federal, state or foreign laws or regulations, our internal policies and procedures or our contracts governing our processing of personal information could result in negative publicity, government investigations and enforcement actions, claims by third parties and damage to our reputation, any of which could have a material adverse effect on our operations, financial performance and business.

In the United States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy laws and federal and state consumer protection laws and regulations that govern the collection, use, disclosure and protection of health-related and other personal information could apply to our operations or the operations of our partners. For example, most healthcare providers, including research institutions from which we obtain patient health information, are subject to privacy and security regulations promulgated under HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009. Under HIPAA, we could potentially face substantial criminal or civil penalties if we knowingly receive individually identifiable health information from a HIPAA-covered healthcare provider or research institution that has not satisfied HIPAA’s requirements for disclosure of individually identifiable health information, or otherwise violate applicable HIPAA requirements related to the protection of such information.

Even when HIPAA does not apply, failing to take appropriate steps to keep consumers’ personal information secure may constitute a violation of the FTC Act. The FTC has been particularly focused on the unpermitted processing of health data through its recent enforcement actions and is expanding the types of privacy violations that it interprets to be “unfair” under Section 5 of the FTC Act, The agency is also in the process of developing rules related to commercial surveillance and data security. We will need to account for the FTC’s evolving rules and guidance for proper privacy and data security practices in order to mitigate risk for a potential enforcement action, which may be costly. The FTC’s enforcement priorities (as well as those of other federal regulators) may be impacted by the change in administration and new leadership. These shifts in enforcement priorities may also impact our business.

In addition, we may maintain sensitive personally identifiable information, including health information, that we receive throughout the clinical trial process, in the course of our research collaborations and directly from individuals (or their healthcare providers) who enroll in our patient assistance programs. As such, we may be subject to state laws requiring notification of affected individuals and state regulators in the event of a breach of personal information. In 2018 California passed into law the California Consumer Privacy Act, or CCPA, which took effect on January 1, 2020, and imposed many requirements on businesses that process the personal information of California residents. Many of the CCPA’s requirements are similar to those found in the General Data Protection Regulation, or the GDPR, including requiring businesses to provide notice to data subjects regarding the information collected about them and how such information is used and shared, and providing data subjects the right to request access to such personal information and, in certain cases, request the erasure of such personal information. The CCPA also affords California residents the right to opt-out of “sales” of their personal information. The CCPA contains significant penalties for companies that violate its requirements. In November 2020 California voters passed a ballot initiative for the California Privacy Rights Act, or the CPRA, which went into effect on January 1, 2023, and significantly expanded the CCPA to incorporate additional GDPR-like provisions including requiring that the use, retention, and sharing of personal information of California residents be reasonably necessary and proportionate to the purposes of collection or processing, granting additional protections for sensitive personal information, and requiring greater disclosures related to notice to residents regarding retention of information. The CPRA also created a new enforcement agency – the California Privacy Protection Agency – whose sole responsibility is to enforce the CPRA and other California privacy laws, which will further increase compliance risk. The provisions in the CPRA may apply to some of our business activities.

In addition to California, at least 18 other states have passed comprehensive privacy laws similar to the CCPA and CPRA. These laws are either in effect or will go into effect sometime before the end of 2026. Like the CCPA and CPRA, these laws create obligations related to the processing of personal information, as well as special obligations for the processing of “sensitive” data (which includes health data in some cases). Some of the provisions of these laws may apply to our business activities. There are also states that are considering or have already passed comprehensive privacy laws during the 2023 legislative sessions that will go into effect in 2024 and beyond. There are also states that are specifically regulating health information that may affect our business. For example, Washington state recently passed a health privacy law that will regulate the collection and sharing of health information, and the law also has a private right of action, which further increases the relevant compliance risk. These laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products.

Plaintiffs’ lawyers are also increasingly using privacy-related statutes at both the state and federal level to bring lawsuits against companies for their data-related practices. In particular, there have been a significant number of cases filed against companies for their use of pixels and other web trackers. These cases often allege violations of the California Invasion of Privacy Act and other state laws regulating wiretapping, as well as the federal Video Privacy Protection Act. The rise in these types of lawsuits creates potential risk for our business.

Our Phase 1 trial for TERN-701, the CARDINAL trial, includes sites from the United States, Europe and other countries. Any clinical trial programs and research collaborations, among other activities, that we engage in outside the United States may implicate international data protection laws, including, in the EEA, the GDPR, which became effective in 2018. The GDPR imposes stringent operational requirements for processors and controllers of personal data. Among other things, the GDPR requires covered companies to provide detailed notices and to abide by consent requirements for clinical trial subjects and other data subjects, to follow procedures regarding the security of personal data and notification of data processing obligations or security incidents to appropriate data protection authorities or data subjects, and to honor and provide certain privacy rights to individuals within the EEA, including the right to access, correct and delete their personal data. If our privacy or data security measures fail to comply with the requirements of the GDPR or other applicable laws or regulations, we may be subject to litigation, regulatory investigations, enforcement notices and/or enforcement actions requiring us to change the way we use personal data and/or fines. In addition to statutory enforcement, a personal data breach can lead to negative publicity and a potential loss of business. Companies that must comply with the GDPR face increased compliance obligations and risk, including more robust regulatory enforcement of data protection requirements and potential fines for noncompliance of up to €20 million or 4% of the annual global revenues of the noncompliant company, whichever is greater. Further, from January 1, 2021, we have had to comply with the GDPR and the United Kingdom GDPR, or UK GDPR, which, together with the amended UK Data Protection Act 2018, retains the GDPR in UK national law. The UK GDPR mirrors the fines under the GDPR, i.e. fines up to the greater of €20 million (£17.5 million) or 4% of global turnover. The relationship between the United Kingdom and the EU in relation to certain aspects of data protection law remains unclear, and it is unclear how United Kingdom data protection laws and regulations will develop in the medium to longer term. The European Commission has adopted an adequacy decision in

favor of the United Kingdom, enabling data transfers from EU member states to the United Kingdom without additional safeguards. However, the UK adequacy decision will automatically expire in June 2025 unless the European Commission re-assesses and renews or extends that decision.

Among other requirements, the GDPR regulates transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States; in July 2020, the Court of Justice of the European Union, or CJEU, invalidated the EU-US Privacy Shield Framework, or Privacy Shield for purposes of international transfers. The EU-US Privacy Shield has now been replaced with the EU-US Data Privacy Framework (DPF), which is intended to address the issues cited by the CJEU in its 2020 court decision. The European Commission issued an adequacy decision for the DPF on July 10, 2023, and it is now a valid mechanism to transfer data from the EU to the US for entities that have registered as part of the DPF. However, it is possible that the validity of the DPF will be challenged in court, which could further create instability related to international data transfers. Additionally, the recent election in the United States and the new administration may also impact whether the DPF remains an adequate data transfer framework. The continuing uncertainty around this issue may further impact our business operations in the EEA.

The CJEU’s decision in 2020 also imposed further restrictions on the use of SCCs. The European Commission issued revised SCCs on June 4, 2021 to account for the decision of the CJEU and recommendations made by the European Data Protection Board. The revised SCCs must be used for relevant new data transfers from September 27, 2021. There is also some uncertainty around whether the revised clauses can be used for all types of data transfers, particularly whether they can be relied on for data transfers to non-EEA entities subject to the GDPR. As supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the SCCs cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

The new SCCs apply only to the transfer of personal data outside of the EEA and not the United Kingdom. The United Kingdom has its own guidance for data transfers to other jurisdictions that are not covered by an “adequacy” decision (which includes the United States) and has adopted the International Data Transfer Agreement, which can serve as a basis for companies to lawfully transfer outside of the United Kingdom. The United Kingdom also has its own data privacy framework that allows registered companies to transfer data from the UK to the US in accordance with the UK GDPR. It is unclear whether this data transfer mechanism will also be challenged in the future.

Although we work to comply with applicable laws, regulations and standards, our contractual obligations and other legal obligations, these requirements are evolving and may be modified, interpreted and applied in an inconsistent manner from one jurisdiction to another, and may conflict with one another or other legal obligations with which we must comply. We will likely be required to expend significant capital and other resources to ensure ongoing compliance with applicable privacy and data security laws. Claims that we have violated individuals’ privacy rights, failed to comply with applicable laws or breached our contractual obligations, even if we are not found liable, could be expensive and time-consuming to defend, and could result in adverse publicity that could harm our business. Moreover, even if we take all necessary action to comply with regulatory requirements, we could be subject to a hack or data breach, which could subject us to fines and penalties, as well as reputational damage.

If we or our partners or vendors fail to comply with applicable federal, state, or local regulatory requirements, we could be subject to a range of regulatory actions that could affect our or any collaborators’ ability to seek to commercialize our clinical candidates. Any threatened or actual government enforcement action could also generate adverse publicity and require that we devote substantial resources that could otherwise be used in other aspects of our business. Any of the foregoing could harm our competitive position, business, financial condition, results of operations and prospects.

We or the third parties upon whom we depend may be adversely affected by earthquakes or other natural disasters, and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster.

Our corporate headquarters and other facilities are located in the San Francisco Bay Area, which has experienced both severe earthquakes and the effects of wildfires. We do not carry earthquake insurance. Earthquakes, wildfires or other natural disasters could severely disrupt our operations, and could materially and adversely affect our business, financial condition, results of operations and prospects.

If a natural disaster, power outage or other event occurred that damaged critical infrastructure or that otherwise disrupted operations, it may be difficult or, in certain cases, impossible, for us to continue our business for a substantial period of time. The disaster recovery and business continuity plans we have in place currently are limited and are unlikely to prove adequate in the event of a serious disaster or similar event. We may incur substantial expenses as a result of the limited nature of our disaster recovery and business continuity plans, which, particularly when taken together with our lack of earthquake insurance, could have a material adverse effect on our business.

Furthermore, integral parties in our supply chain are similarly vulnerable to natural disasters or other sudden, unforeseen and severe AEs.

If such an event were to affect our supply chain, it could have a material adverse effect on our business.

Significant disruptions of information technology systems, breaches of data security and other incidents could materially adversely affect our business, results of operations and financial condition.

We collect and maintain information in digital and other forms that is necessary to conduct our business, and we are increasingly dependent on information technology systems and infrastructure to operate our business. In the ordinary course of our business, we collect, store and transmit large amounts of confidential information, including intellectual property, proprietary business information and personal information. It is critical that we do so in a secure manner to maintain the privacy, security, confidentiality and integrity of such confidential information. We have established physical, electronic and organizational measures designed to safeguard and secure our systems to prevent a data compromise, and rely on commercially available systems, software, tools and monitoring to provide security for our information technology systems and the processing, transmission and storage of digital information. We have also outsourced elements of our information technology infrastructure, and as a result, our third-party vendors may have access to our confidential information. Our internal information technology systems and infrastructure, and those of any future collaborators and our contractors, consultants, vendors and other third parties on which we rely, are vulnerable to damage or unauthorized access or use resulting from computer viruses, malware, natural disasters, terrorism, war, telecommunication and electrical failures, cyber-attacks or cyber-intrusions over the Internet, denial or degradation of service attacks, ransomware, hacking, phishing and other social engineering attacks, attachments to emails, persons inside our organization or persons with access to systems inside our organization.

The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusion, including by computer hackers, foreign governments, non-state foreign actors and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. The prevalent use of mobile devices that access confidential information also increases the risk of lost or stolen devices, security incidents and data security breaches, which could lead to the loss of confidential information or other intellectual property. A number of our employees work remotely, which may create additional opportunities for cybercriminals to exploit vulnerabilities. Furthermore, because the techniques used to obtain unauthorized access to, or to sabotage, systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. We may also experience security breaches that may remain undetected for an extended period. Despite the implementation of security measures, our internal computer systems and those of our CROs and other contractors and consultants are vulnerable to damage from computer viruses and unauthorized access. Although we do not believe that we have experienced any material system failure or security breach to date, if such an event were to occur and cause interruptions in our operations or those of our third-party CROs, vendors and other contractors and consultants, it could result in a material disruption of our development programs and our business operations. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or those of our third-party CROs, vendors and other contractors and consultants, or inappropriate disclosure of confidential or proprietary information or patient information, we could incur liability and the further development and commercialization of our product candidates could be delayed. For example, the loss or misuse of

clinical trial or patient data from completed or future clinical trials could result in material delays in and interruptions to our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. Likewise, we rely on our third-party research institution collaborators for research and development of our product candidates and other third parties for the manufacture of our product candidates and to conduct clinical trials and similar events relating to their computer systems could also have a material adverse effect on our business. We cannot assure you that our data protection efforts and our investment in information technology will prevent significant breakdowns, data leakages, breaches in our systems, or those of our third-party CROs, vendors and other contractors and consultants, or other cyber incidents that could have a material adverse effect upon our reputation, business, operations or financial condition. Any security incident or disruption event that leads to unauthorized access, use, or disclosure of personal information, including personal information regarding our clinical trial subjects or employees, could harm our reputation, compel us to comply with federal and/or state breach notification laws and foreign law equivalents, subject us to mandatory corrective action and otherwise subject us to liability under laws and regulations that protect the privacy and security of personal information, which could result in significant legal and financial exposure and reputational damages that could potentially have an adverse effect on our business. The costs related to significant security breaches or disruptions could also be material and exceed the limits of any applicable insurance we may maintain against such risks. If the information technology systems of our third-party CROs, vendors and other contractors and consultants become subject to disruptions or security breaches, we may have insufficient recourse against such third parties and we may have to expend significant resources to mitigate the impact of such an event, and to develop and implement protections to prevent future events of this nature from occurring.

In addition, we have and will enter into collaboration, license, contract research and/or manufacturing relationships with contract organizations that operate in certain countries that are at heightened risk of theft of technology, data and intellectual property through direct intrusion by private parties or foreign actors, including those affiliated with or controlled by state actors. Accordingly, our efforts to protect and enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license, and we may be at heightened risk of losing our proprietary intellectual property rights around the world, including outside of such countries, to the extent such theft or intrusion destroy the proprietary nature of our intellectual property.

Any failure of our technology or systems to perform satisfactorily could result in an adverse impact on our business.

We rely on software, hardware, network systems and similar technology, including cloud-based technology, that is either developed by us or licensed from or maintained by third parties to operate our website, our internal systems and processes, and to store and track certain data, and to support our business operations. As much of this technology is complex, there may be future errors, defects or performance problems, including when we update our technology or integrate new technology to expand and enhance our capabilities. Our technology may malfunction or suffer from defects that become apparent only after extended use. The integrity of our technology may also be compromised as a result of third-party cyber-attacks, such as hacking, spear phishing campaigns and denial of service attacks, which are negatively impacting companies. In addition, our operations depend on our ability to protect our information technology systems against damage from third-party cyber-attacks, fire, power loss, water, earthquakes, telecommunications failures and similar unexpected AEs. Disruptions in our website, internal systems and clinical research or network systems could result from a number of factors, including unknown technical defects, insufficient capacity, the failure of our third-party providers to provide continuous and uninterrupted service and unusual volume in traffic for our internal systems. Such disruptions would be most impactful if they occurred in connection with our data storage and clinical research data and may impact accessibility to our clinical research and operations. While we maintain disaster recovery capabilities to return to normal operation in a timely manner, and we deploy multiple parallel instances of our applications across multiple computer resources, we do not have a fully redundant system that includes an instantaneous recovery capability. In the event we experience significant disruptions, we may be unable to repair our systems in an efficient and timely manner, which could have an adverse impact on our business.

As a result of such possible defects, failures, interruptions or other problems, our data and clinical research could be rendered inoperable, which could result in harm to our reputation and our ability to develop our product candidates. Any failure of our technology or systems could result in an adverse impact on our business.

We are subject to United States and foreign anti-corruption and anti-money laundering laws with respect to our operations and non-compliance with such laws can subject us to criminal and/or civil liability and harm our business.

We are subject to the FCPA, the United States domestic bribery statute contained in 18 U.S.C. § 201, the United States Travel Act, the USA PATRIOT Act and other state and national anti-bribery and anti-money laundering laws in countries in which we conduct activities. Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, third-party intermediaries, joint venture partners and collaborators from authorizing, promising, offering or providing, directly or indirectly, improper payments or benefits to recipients in the public or private sector. We may have direct or indirect interactions with officials and employees of government agencies or government-affiliated hospitals, universities and other organizations. In addition, we may engage third party intermediaries to promote our clinical research activities abroad and/or to obtain necessary permits, licenses and other regulatory approvals. We can be held liable for the corrupt or other illegal activities of these third-party intermediaries, our employees, representatives, contractors, partners and agents, even if we do not explicitly authorize or have actual knowledge of such activities.

Noncompliance with anti-corruption and anti-money laundering laws could subject us to whistleblower complaints, investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension and/or debarment from contracting with certain persons, the loss of export privileges, reputational harm, adverse media coverage and other collateral consequences. If any subpoenas, investigations or other enforcement actions are launched, or governmental or other sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, results of operations and financial condition could be materially harmed. In addition, responding to any action will likely result in a materially significant diversion of management’s attention and resources and significant defense and compliance costs and other professional fees. In certain cases, enforcement authorities may even cause us to appoint an independent compliance monitor which can result in added costs and administrative burdens.

We will also need to carefully navigate the new administration’s implementation of the FCPA. On February 10, 2025, President Trump issued an Executive Order directing the Attorney General to review the guidelines and policies governing FCPA investigations and enforcement actions. Per the Executive Order, this review will result in new DOJ FCPA guidelines intended to enhance American economic competitiveness and to safeguard national security interests. During the 180-day review period, any new FCPA investigations and enforcement actions are to be suspended absent authorization from the Attorney General, and all existing FCPA investigations and enforcement actions will be reviewed. Additionally, after the Attorney General issues revised guidelines, the Executive Order directs her to assess whether “remedial measures” related to past FCPA actions are warranted.

Various laws, regulations and executive orders also restrict the use and dissemination outside of the United States, or the sharing with certain non-U.S. nationals, of information classified for national security purposes, as well as certain products and technical data relating to those products. Further, the provision of benefits or advantages to physicians to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order, or use of medicinal products is prohibited in the EU. The provision of benefits or advantages to physicians is also governed by the national anti-bribery laws of EU Member States and the United Kingdom Bribery Act 2010. Infringement of these laws could result in substantial fines and imprisonment. Payments made to physicians in certain EU Member States must be publicly disclosed. Moreover, agreements with physicians often must be the subject of prior notification and approval by the physician’s employer, his or her competent professional organization and/or the regulatory authorities of the individual EU Member States. These requirements are provided in the national laws, industry codes, or professional codes of conduct applicable in the EU Member States. Failure to comply with these requirements could result in reputational risk, public reprimands, administrative penalties, fines, or imprisonment.

Changes in U.S. and international trade policies, particularly with respect to China, may adversely impact our business and operating results.

The U.S. government has recently made statements and taken certain actions that may lead to potential changes to U.S. and international trade policies, including imposing several rounds of tariffs and export control restrictions affecting certain products manufactured in China, and most recently, proposing legislation that, if enacted would restrict trade with certain Chinese companies that provide biopharmaceutical research, development, and manufacturing services. Recently both China and the United States have each imposed tariffs indicating the potential for further trade barriers, including the U.S. Commerce Department adding numerous Chinese entities to its “unverified list,” which requires U.S. exporters to go through more procedures before exporting goods to such entities. It is unknown whether and to what extent new tariffs, export controls, or other new laws or regulations will be adopted, or the effect that any such actions would have on us or our industry. Sustained uncertainty about, or the further escalation of, trade and political tensions between the United States and China could result in a disadvantageous research and manufacturing environment in China, particularly for U.S. based companies, including retaliatory restrictions that hinder or potentially inhibit our ability to rely on CDMOs and other service providers that operate in China. For example, proposed legislation has been introduced in Congress that could prohibit, among other things, the use of U.S. government executive agency contract, grant, or loan funding to procure or obtain, or enter into, extend or renew contracts involving the use of certain equipment or services produced or provided by certain Chinese companies, including our current CDMO, WuXi Biologics, which could cause us to reevaluate our relationship with our current CDMO.

Further, some of our manufacturers and suppliers are located in China. Trade tensions and conflicts between the United States and China have been escalating in recent years and, as such, we are exposed to the possibility of product supply disruption and increased costs and expenses in the event of changes to the laws, rules, regulations and policies of the governments of the United States or China, or due to geopolitical unrest and unstable economic conditions. Certain Chinese biotechnology companies may become subject to trade restrictions, sanctions, other regulatory requirements or proposed legislation by the U.S. government, which could restrict or even prohibit our ability to work with such entities, thereby potentially disrupting their supply of material to us. For example, in February 2024, U.S. lawmakers called for investigations into and the imposition of possible trade sanctions against certain Chinese biotechnology companies, including WuXi AppTec and WuXi Biologics, or collectively WuXi, over alleged ties to the Chinese military. Escalating tensions between the United States and China may prevent or hinder the export of materials or technical information between us and our CDMO and third parties, such as pharmaceutical partners. These third parties may voluntarily require compliance or supply chain requirements that go above and beyond potential legislation to address perceived risk of “pass through,” which would make it difficult for us to operate our business.

In addition, in September 2024 during the 118th Congress, the U.S. House of Representatives passed the BIOSECURE Act (H.R. 8333). This bill names the following as biotechnology companies of concern: BGI, MGI, Complete Genomics, WuXi AppTec, and WuXi Biologics. The Senate advanced a substantially similar bill (S. 3558) but it did not pass. The Senate bill named the following as biotechnology companies of concern: BGI, MGI, Complete Genomics, WuXi AppTec, and any subsidiary, parent affiliate, or successor of such entities. If this legislation had been enacted into law, and while both bills had certain grandfather provision, the legislation would have potentially restricted the ability of U.S. biotechnology companies like ours to purchase services or products from, or otherwise collaborate with, specifically named Chinese biotechnology companies, including WuXi, and it would have authorized the U.S. government to impose such restrictions on entities' transactions with additional Chinese biotechnology companies as a condition of U.S. government contract, grant and loan funding. We anticipate these bills will be reintroduced during the 119th Congress but, as of February 20, 2025, they have not been introduced in either chamber. If these bills become law, or similar laws are passed, they would have the potential to severely restrict the ability of companies like ours to contract with certain Chinese biotechnology companies of concern without losing the ability to contract with, or otherwise received funding from, the U.S. government. Such disruptions could have adverse effects on the development of our product candidates and our business operations.

Any unfavorable government policies on international trade, such as export controls, capital controls or tariffs, may increase the cost of manufacturing our product candidates and platform materials, affect the demand for our drug products (if and once approved), the competitive position of our product candidates, and import or export of raw materials and finished product candidate used in our and our collaborators’ preclinical studies and clinical trials, particularly with respect to any product candidates and materials that we import from China, including pursuant to our manufacturing service arrangements with WuXi. If any new tariffs, export controls, legislation and/or regulations are implemented, or if existing trade agreements are renegotiated or, in particular, if either the U.S. or Chinese government takes retaliatory trade actions due to the recent trade tension, such changes could have an adverse effect on our business, financial condition and results of operations.

China’s economic, political and social conditions, as well as governmental policies, could affect our ability to operate our business.

A significant portion of our manufacturing operations is currently conducted in China. Accordingly, our business, results of operations, financial condition and prospects may be influenced to a significant degree by economic, political, legal and social conditions in China as well as China’s economic, political, legal and social conditions in relation to the rest of the world. China’s economy differs from the economies of developed countries in many respects, including with respect to the amount of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources. While China’s economy has experienced significant growth in the past, growth has slowed down and has been uneven across different regions and among various economic sectors of China. China’s government has implemented various measures to encourage economic development and guide the allocation of resources. Some of these measures may have a negative effect on us. For example, our financial condition and results of operations may be adversely affected by government control over capital investments or changes in tax regulations that are currently applicable to us. In addition, in the past, China’s government implemented certain measures, including interest rate increases, to control the pace of economic growth. These measures may cause decreased economic activity in China, which may adversely affect our business and results of operation. More generally, if the business environment in China deteriorates from the perspective of domestic or international investment, our business in China may also be adversely affected.

The pharmaceutical industry in China is highly regulated and such regulations are subject to change which may affect approval and commercialization of our product candidates.

Some of our research and development operations and manufacturing facilities are in China. The pharmaceutical industry in China is subject to comprehensive government regulation and supervision, encompassing the approval, registration, manufacturing, packaging, licensing and marketing of new drugs. In recent years, the regulatory framework in China regarding the pharmaceutical industry has undergone significant changes, and we expect that it will continue to undergo significant changes. Any such changes or amendments may result in increased compliance costs on our business or cause delays in or prevent the successful development of our product candidates in China and reduce the current benefits we believe are available to us from developing and manufacturing drugs in China. PRC authorities have become increasingly vigilant in enforcing laws in the pharmaceutical industry and any failure by us or our partners to maintain compliance with applicable laws and regulations or obtain and maintain required licenses and permits may result in the suspension or termination of our business activities in China. We believe our strategy and approach are aligned with the PRC government’s regulatory policies, but we cannot ensure that our strategy and approach will continue to be aligned.

If we fail to comply with environmental, health and safety laws and regulations of China, we could become subject to fines or penalties or incur costs that could have a material adverse effect on the success of our business.

We are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and wastes. Our manufacturing operations primarily occur in China and involve the use of hazardous materials, including chemical materials. Our operations also produce hazardous waste products. We are therefore subject to PRC laws and regulations concerning the discharge of waste water, gaseous waste and solid waste during our processes of research and development of our product candidates. We engage competent third-party contractors for the transfer and disposal of these materials and wastes. Despite our intention to do so, we may not comply fully with environmental regulations at all times. Any violation of these regulations may result in substantial fines, criminal sanctions, revocations of operating permits, shutdown of our facilities and obligations to take corrective measures. We cannot completely eliminate the risk of contamination or injury from these materials and wastes. In the event of contamination or injury resulting from the use or discharge of hazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs associated with civil, administrative or criminal fines and penalties.

Although we maintain workers’ compensation insurance to cover costs and expenses incurred due to on-the-job injuries to our employees and third-party liability insurance for injuries caused by unexpected seepage, pollution or contamination, such insurance may not provide adequate coverage against potential liabilities. Furthermore, China may take steps towards the adoption of more stringent environmental regulations. Due to the possibility of unanticipated regulatory or other developments, the amount and timing of future environmental expenditures may vary substantially from those currently anticipated. If there is any unanticipated change in the environmental regulations, we may need to incur substantial capital expenditures to install, replace, upgrade or supplement our manufacturing facility and equipment or make operational changes to limit any adverse impact or potential adverse impact on the environment in order to comply with new environmental protection laws and regulations. If such costs become prohibitively expensive, we may be forced to cease certain aspects of our business operations.

Failure to comply with PRC regulations regarding the registration requirements for employee stock ownership plans or equity incentive plans may subject the PRC plan participants or us to fines and other legal or administrative sanctions.

Under the applicable regulations and State Administration of Foreign Exchange of the People’s Republic of China, or SAFE, rules, PRC citizens who participate in an employee stock ownership plan or a stock option plan in an overseas publicly listed company are required to register with SAFE and complete certain other procedures. In February 2012, SAFE promulgated the Notices on Issues concerning the Foreign Exchange Administration for Domestic Individuals Participating in Stock Incentive Plans of Overseas Publicly Listed Companies, or the Stock Option Rules, which replaced the Application Procedures of Foreign Exchange Administration for Domestic Individuals Participating in Employee Stock Ownership Plan or Stock Option Plans of Overseas Publicly Listed Companies issued by SAFE in March 2007. Pursuant to the Stock Option Rules, if a PRC resident participates in any stock incentive plan of an overseas publicly listed company, a qualified PRC domestic agent must, among other things, file on behalf of such participant an application with SAFE to conduct the SAFE registration with respect to such stock incentive plan and obtain approval for an annual allowance with respect to the purchase of foreign exchange in connection with the exercise or sale of stock options or stock such participant holds. Such participating PRC residents’ foreign exchange income received from the sale of stock and dividends distributed by the overseas publicly listed company must be fully remitted into a PRC collective foreign currency account opened and managed by the PRC agent before distribution to such participants. We and our PRC resident employees who have been granted stock options or other stock-based incentives of ours are subject to the Stock Option Rules. If we or our PRC resident participants fail to comply with these regulations, we and/or our PRC resident participants may be subject to fines and legal sanctions.

Our stock price may be volatile and you may not be able to resell shares of our common stock at or above the price you paid.

The trading price of our common stock could be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control. In particular, the trading prices for pharmaceutical, biopharmaceutical and biotechnology companies have been highly volatile. These factors include those discussed in this Item 1A. “Risk Factors” section of this Annual Report on Form 10-K and others such as:

In addition, the stock markets in general, and the markets for pharmaceutical, biopharmaceutical and biotechnology stocks in particular, have experienced extreme volatility that may have been unrelated to the operating performance of the issuer. These broad market fluctuations may adversely affect the trading price or liquidity of our common stock.

We have incurred and will continue to incur significant costs as a result of operating as a public company, and our management devotes substantial time to new compliance initiatives. We may fail to comply with the rules that apply to public companies, including Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, which could result in sanctions or other penalties that could materially and adversely affect our business, financial condition, results of operations and prospects.

We have incurred and will continue to incur significant legal, accounting and other expenses as a public company, including costs resulting from public company reporting obligations under the Exchange Act and regulations regarding corporate governance practices. The listing requirements of The Nasdaq Global Select Market and the rules of the SEC require that we satisfy certain corporate governance requirements relating to director independence, filing annual and interim reports, stockholder meetings, approvals and voting, soliciting proxies, conflicts of interest and a code of conduct. Our management and other personnel need to devote a substantial amount of time to ensure that we comply with all of these requirements. Moreover, the reporting requirements, rules and regulations increase our legal and financial compliance costs and make some activities more time-consuming and costly. These reporting requirements, rules and regulations, coupled with the increase in potential litigation exposure associated with being a public company, also make it more difficult for us to attract and retain qualified persons to serve on our board of directors or board committees or to serve as executive officers, or to obtain certain types of insurance, including directors’ and officers’ insurance, on acceptable terms.

We are subject to Section 404 and the related rules of the SEC, which generally require our management and independent registered public accounting firm to report on the effectiveness of our internal control over financial reporting. Section 404 requires an annual management assessment of the effectiveness of our internal control over financial reporting. However, for so long as we remain an emerging growth company as defined in the JOBS Act, we intend to take advantage of certain exemptions from various reporting requirements that are available to emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404. Once we are no longer an emerging growth company or, if prior to such date, we opt to no longer take advantage of the applicable exemption, we will be required to include an opinion from our independent registered public accounting firm on the effectiveness of our internal control over financial reporting.

During the course of our review and testing, we may identify deficiencies and be unable to remediate them before we must provide the required reports. Furthermore, if we identify any material weaknesses, or even if we do not identify a material weakness but one exists, we may not detect those errors on a timely basis and our financial statements may be materially misstated. We or our independent registered public accounting firm may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting, which could materially and adversely affect our business, financial condition, results of operations and prospects, cause investors to lose confidence in our reported financial information and cause the trading price of our stock to fall. In addition, as a public company we will be required to file accurate and timely quarterly and annual reports with the SEC under the Exchange Act. In order to report our results of operations and financial statements on an accurate and timely basis, we will depend in part on CROs and other third parties to provide timely and accurate notice of their costs to us. Any failure to report our financial results on an accurate and timely basis could result in sanctions, lawsuits, delisting of our shares from the Nasdaq Global Market or other adverse consequences that would materially and adversely affect our business, financial condition, results of operations and prospects.

Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations.

Our quarterly and annual operating results may fluctuate significantly, which makes it difficult for us to predict our future operating results. These fluctuations may occur due to a variety of factors, many of which are outside of our control and may be difficult to predict, including but not limited to:

The cumulative effects of these factors could result in large fluctuations and unpredictability in our quarterly and annual operating results. As a result, comparing our operating results on a period-to-period basis may not be meaningful. Investors should not rely on our past results as an indication of our future performance.

This variability and unpredictability could also result in our failing to meet the expectations of industry or financial analysts or investors for any period. If our revenue or operating results fall below the expectations of analysts or investors or below any forecasts we may provide to the market, or if any forecasts we provide to the market are below the expectations of analysts or investors, the price of our common stock could decline substantially. Such a stock price decline could occur even when we have met any previously publicly stated revenue or earnings guidance we may provide.

Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.

Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, if a corporation undergoes an “ownership change,” generally defined as a greater than 50 percentage point change (by value) in its equity ownership by certain stockholders over a three-year period, the corporation’s ability to use its pre-change net operating loss carryforwards, or NOLs and other pre-change tax attributes (such as research and development tax credits) to offset its post-change income or taxes may be limited. We have experienced ownership changes in the past and may experience ownership changes as a result of subsequent shifts in our stock ownership (some of which are outside our control). In addition, under current tax law, federal NOLs generated in periods after December 31, 2017 may be carried forward indefinitely but in taxable years beginning after December 31, 2020, may only be used to offset 80% of our taxable income. As a result, our ability to use our pre-change NOLs and tax credits to offset future taxable income, if any, could be subject to limitations. Similar provisions of state tax law may also apply. As a result, even if we attain profitability, we may be unable to use a material portion of our NOLs and tax credits.

Provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable and may lead to entrenchment of management.

Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that could delay or prevent changes in control or changes in our management without the consent of our board of directors. These provisions include the following:

We are also subject to the anti-takeover provisions contained in Section 203 of the Delaware General Corporation Law. Under Section 203, a corporation may not, in general, engage in a business combination with any holder of 15% or more of its capital stock unless the holder has held the stock for three years or, among other exceptions, the board of directors has approved the transaction.

Our amended and restated certificate of incorporation and amended and restated bylaws provide that the Court of Chancery of the State of Delaware is the exclusive forum for certain disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our amended and restated certificate of incorporation and amended and restated bylaws provide that the Court of Chancery of the State of Delaware (or, in the event that the Court of Chancery does not have jurisdiction, the federal district court for the District of Delaware or other state courts of the State of Delaware) is the exclusive forum for any derivative action or proceeding brought on our behalf, any action asserting a claim of breach of fiduciary duty, any action asserting a claim against us arising pursuant to the Delaware General Corporation Law, our amended and restated certificate of incorporation or our amended and restated bylaws, or any action asserting a claim against us that is governed by the internal affairs doctrine; provided that, the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction; and provided further that, if and only if the Court of Chancery of the State of Delaware dismisses any such action for lack of subject matter jurisdiction, such action may be brought in another state or federal court sitting in the State of Delaware. Our amended and restated certificate of incorporation and amended and restated bylaws also provide that the federal district courts of the United States of America are the exclusive forum for the resolution of any complaint asserting a cause of action against us or any of our directors, officers, employees or agents and arising under the Securities Act. Nothing in our amended and restated certificate of incorporation and amended and restated bylaws precludes stockholders that assert claims under the Exchange Act from bringing such claims in state or federal court, subject to applicable law.

This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other employees or stockholders, which may discourage lawsuits with respect to such claims, although our stockholders will not be deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder. Furthermore, the enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable. While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions, and there can be no assurance that such provisions will be enforced by a court in those other jurisdictions. If a court were to find the choice of forum provision that is contained in our amended and restated certificate of incorporation and amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.

We do not currently intend to pay dividends on our common stock, and, consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our common stock.

We do not currently intend to pay any cash dividends on our common stock for the foreseeable future. We currently intend to invest our future earnings, if any, to fund our growth. Therefore, you are not likely to receive any dividends on your common stock for the foreseeable future. Since we do not intend to pay dividends, your ability to receive a return on your investment will depend on any future appreciation in the market value of our common stock. There is no guarantee that our common stock will appreciate or even maintain the price at which our holders have purchased it.

If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our stock, our stock price and trading volume could decline.

The trading market for our common stock is influenced by the research and reports that industry or securities analysts publish about us or our business. We do not have any control over these analysts or what they publish, and we may have limited opportunity to communicate with them during certain times of the year. There can be no assurance that analysts will continue to cover us, cover us accurately, or provide favorable coverage. In the event any of the analysts who cover us issue an adverse or misleading opinion, or fail to correct an error in their reports or statements, about us, our business model, our intellectual property or our stock performance, or if our clinical trials and operating results fail to meet the expectations of analysts, our stock price would likely decline. If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

Future sales and issuances of our common stock could and would likely result in additional dilution of the percentage ownership of our stockholders and could cause our share price to fall.

We may from time to time issue additional shares of common stock at a discount from the current trading price of our common stock. As a result, our stockholders would experience immediate dilution upon the purchase of any shares of our common stock sold at such discount. In addition, as opportunities present themselves, we may enter into financing or similar arrangements in the future, including the issuance of debt securities, preferred stock or common stock. If we issue common stock or securities convertible into common stock, our common stockholders would experience additional dilution and, as a result, our stock price may decline.

We may be subject to securities litigation, which is expensive and could divert our management’s attention.

In the past, companies that have experienced volatility in the market price of their securities have been subject to securities class action litigation. We may be the target of this type of litigation in the future. Regardless of the merits or the ultimate results of such litigation, securities litigation brought against us could result in substantial costs and divert our management’s attention from other business concerns.

We are an “emerging growth company,” and as a result of the reduced disclosure and governance requirements applicable to emerging growth companies, our common stock may be less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act, and we intend to take advantage of certain exemptions from various reporting requirements that are available to emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. In addition, as an “emerging growth company,” the JOBS Act allows us to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We have elected to use this extended transition period under the JOBS Act. As a result, our consolidated financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards that are applicable to public companies, which may make comparison of our financials to those of other public companies more difficult.

We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. We may take advantage of these reporting exemptions until we are no longer an emerging growth company. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year following the fifth anniversary of the consummation of our IPO, (2) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion, (3) the last day of the fiscal year in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, which would occur if the market value of our common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year, or (4) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

Our business has been and could in the future be adversely affected by a global pandemic or other future public health events, including any economic impact due to the recovery therefrom, in regions where we or third parties on which we rely have significant manufacturing facilities, concentrations of clinical trial sites or other business operations.

While the economic impact brought by, and the duration of, the COVID-19 pandemic was difficult to assess or predict, we know that potential impacts from any potential future global pandemic or similar public health event include impediment to the development of our product candidates, disruption in our supply chains, delays in our clinical trials, reduced productivity of our employees, reduced access to capital or limitations to our business development activities.

In the event of a future pandemic or similar public health events, potential patients in our ongoing or planned clinical trials may choose to not enroll, not participate in follow-up clinical visits or drop out of the trials. Further, some patients may not be able or willing to comply with clinical trial protocols if quarantines impede patient movement or interrupts healthcare services. Similarly, our ability to recruit and retain principal investigators and site staff may be adversely impacted.

In addition, ongoing or planned clinical trials may also be impacted by interruptions or delays in the operations of the FDA and comparable foreign regulatory authorities, in the event of a future pandemic or similar public health events. We may need to make certain adjustments to the operation of our trials in an effort to ensure the monitoring and safety of patients and minimize risks to trial integrity during the pandemic in accordance with the guidance issued by the FDA as a result.

We may also encounter a shortage in supplies of, or in delays in shipping, our study drug or other components of the clinical trial vital for successful conduct of the trial. Further, the successful conduct of our clinical trials depends on retrieving laboratory, imaging and other data from patients. Any failure by the vendors we work with to send us such data could impair the progress of such clinical trials. These events could delay our clinical trials, increase the cost of completing our clinical trials and negatively impact the integrity, reliability or robustness of the data from our clinical trials.

Quarantines, shelter-in-place and similar government orders, or the perception that such orders, shutdowns or other restrictions on the conduct of business operations could occur, which could disrupt the supply chain for our product candidates or other goods or services used in our clinical trials. To the extent our suppliers and service providers are unable to comply with their obligations under our agreements with them or they are otherwise unable to deliver or are delayed in delivering goods and services to us due to a future pandemic, our ability to continue meeting clinical supply demand for our product candidates or otherwise advancing development of our product candidates may become impaired.

Unfavorable global economic or political conditions could adversely affect our business, financial condition or results of operations.

Our business is susceptible to general conditions in the global economy and in the global financial markets. A global financial crisis or a global or regional political disruption could cause extreme volatility in the capital and credit markets. A severe or prolonged economic downturn or political disruption could result in a variety of risks to our business, including weakened demand for our current or future product candidates, if approved, and our ability to raise additional capital when needed on acceptable terms, if at all. A weak or declining economy or political disruption could also strain our manufacturers or suppliers, possibly resulting in supply disruption, or cause our customers to delay making payments for our potential drugs, if approved. Any of the foregoing could materially and adversely affect our business, financial condition, results of operations and prospects, and we cannot anticipate all of the ways in which the political or economic climate and financial market conditions could adversely impact our business.

We lease approximately 9,750 square feet of space for our current headquarters in Foster City, California under an agreement that expires in October 2027. The Company has the option to extend the lease agreement for a period of three years. We believe that our existing facilities are adequate to meet our current needs, and that suitable additional alternative spaces will be available in the future on commercially reasonable terms.

From time to time, we may be involved in legal proceedings or subject to claims incident to the ordinary course of business. While the outcome of any such proceedings cannot be predicted with certainty, as of December 31, 2024, we were not a party to any litigation or legal proceedings that, in the opinion of our management, are probable to have a material adverse effect on our business. Regardless of the outcome, such proceedings or claims can have an adverse impact on us because of defense and settlement costs, diversion of resources, reputational harm, and other factors, and there can be no assurances that favorable outcomes will be obtained.

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Our common stock has been listed on the Nasdaq Global Select Market since February 5, 2021 under the symbol “TERN.” Prior to such time, there was no public market for our common stock.

As of March 14, 2025, there were approximately 4 stockholders of record of our common stock. Certain shares are held in “street” name and thus the actual number of beneficial owners of such shares is not known or included in the foregoing number.

We have never declared or paid cash dividends on our capital stock, and we do not currently intend to pay any cash dividends on our capital stock in the foreseeable future. We currently intend to retain all available funds and any future earnings, if any, to fund the development and expansion of our business. Any future determination related to dividend policy will be made at the discretion of our board of directors, subject to applicable laws, and will depend upon, among other factors, our results of operations, financial condition, contractual restrictions and capital requirements.

Information about our equity compensation plans is incorporated herein by reference to Item 12 of Part III of this Annual Report on Form 10-K.

In February 2021, we completed our initial public offering, or IPO, and issued an aggregate of 8,625,000 shares of our common stock at a price of $17.00 per share, including the exercise in full of the underwriters’ option to purchase additional shares of our common stock. We received net proceeds from the IPO of $133.0 million, after deducting underwriting discounts and commissions of $10.3 million and offering expenses of $3.3 million. None of the expenses associated with the IPO were paid to directors, officers, persons owning 10% or more of any class of equity securities, or to their associates. J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC and Cowen and Company, LLC acted as book-running managers for the IPO.

Since the completion of our IPO, our common stock is traded on the Nasdaq Global Select Market. The offer and sale of the shares were registered under the Securities Act on a registration statement on Form S-1 (Registration No. 333- 252180), which was declared effective on February 4, 2021.

As of December 31, 2024, we have used all of the proceeds from our IPO. The net proceeds from our IPO were used, together with our cash and cash equivalents to fund continued advancement of our product pipeline, working capital and other general corporate purposes. There has been no material change in the planned use of proceeds from our IPO as described in the related prospectus filed with the SEC pursuant to Rule 424(b)(4) under the Securities Act. We invested the funds received in cash equivalents and other marketable securities in accordance with our investment policy.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. In addition to historical financial information, this discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Special Note Regarding Forward-Looking Statements” and “Risk Factors” and elsewhere in this Annual Report on Form 10-K. Our fiscal year ends on December 31 each year.

We are a clinical-stage biopharmaceutical company developing a portfolio of small-molecule product candidates to address serious diseases, including oncology and obesity. Our programs are based on mechanisms of action that have achieved proof-of-concept in clinical trials in indications with significant unmet medical needs. We are advancing multiple drug candidates we believe have the potential to deliver improved clinical outcomes in the target indication as either single-agent or combination therapies. The most advanced product candidates in our pipeline – TERN-701, TERN-601 and TERN-501 – were internally discovered. Additionally, we have an ongoing discovery effort for the TERN-800 series of small-molecule glucose-dependent insulinotropic polypeptide receptor (GIPR) modulators for obesity, which have the potential to be combined with glucagon-like peptide-1 (GLP-1) receptor agonists.

TERN-701 is our proprietary, oral, potent, allosteric BCR-ABL tyrosine kinase inhibitor (TKI) specifically targeting the ABL myristoyl pocket for chronic myeloid leukemia (CML), a form of cancer that begins in the bone marrow and leads to the growth of leukemic cells and is classified as an orphan indication. Allosteric TKIs, which bind to the myristoyl-binding pocket, represent a novel treatment class for CML that addresses the shortcomings of active-site TKIs, including off-target activity and limited efficacy against active site resistance mutations. TERN-701 aims to address the limitations of active-site TKIs with the goal of achieving improved tumor suppression through a combination of (1) improved efficacy against BCR-ABL, including a broad range of mutations, (2) improved safety and tolerability profiles, and an improved drug-drug interaction profile, and (3) improved convenience with once-a-day dosing for all patients, with or without food. Because of increased survival rates and treatment durations for people living with CML, physicians are seeking additional safe and efficacious therapies for people whose tolerability of their CML therapy, co-morbidity and/or drug-drug interaction profiles change over time, limiting their available treatment options, quality of life and the effectiveness of mainstay therapies. Within the allosteric TKI class, which has one approved agent, asciminib, we have generated emerging data to support a potential best in class profile for TERN-701. Supporting efficacy data include numerically greater potency than asciminib against multiple BCR-ABL variants, improved pharmacokinetic and target coverage over asciminib and rescue of clinical response in asciminib failures. TERN-701 has also demonstrated a promising safety profile relative to asciminib, with no dose limiting toxicities (DLTs) and no adverse event (AE)-related treatment discontinuations or dose reductions in the dose escalation phase of our Phase 1 trial. In healthy volunteer studies, TERN-701 also demonstrated the ability to be dosed once-daily without regard to food, as well as a favorable drug-drug interaction profile, which represents potential key differentiators over asciminib. Our Phase 1 trial, CARDINAL, is progressing and includes sites from the United States, Europe and other countries. In December 2024, we announced positive early data from the CARDINAL trial. As of the cutoff date, 15 patients were enrolled across three dose cohorts of 160 mg, 320 mg and 400 mg, with an overall median treatment duration of 3 months. TERN-701 demonstrated compelling molecular responses starting at the lowest dose level in heavily pre-treated patients with high baseline BCR-ABL transcript levels. TERN-701 also showed an encouraging safety profile with no DLTs, AE-related treatment discontinuations or dose reductions across all dose escalation cohorts. The dose escalation phase is complete and initiation of dose expansion is expected in the second quarter of 2025. The backfill dosing of new participants continues in existing cohorts of dose escalation. Additional safety and efficacy data are expected in the fourth quarter of 2025, which is expected to include a larger cohort of patients with longer durations of treatment and read through to a potential approval endpoint of a six-month major molecular response (MMR). The United States Food and Drug Administration (FDA) granted Orphan Drug Designation for TERN-701 for the treatment of chronic myeloid leukemia in March 2024.

TERN-601 is our small-molecule GLP-1 receptor agonist program that is intended to be orally administered once-daily for obesity. Obesity is a chronic disease that is increasing in prevalence in adults, adolescents and children and is often defined by having an elevated body mass index (BMI) of 30 or greater. Mechanisms that contribute to increased weight include sedentary lifestyles, increased calorie intake and medications such as insulins and antipsychotics. Insulin resistance, a hallmark of metabolic syndrome, also plays a key role in obesity. GLP-1 offers multiple benefits including increased insulin secretion to the pancreas, reduced glucagon secretion in the liver, slowed gastric emptying into the gut, increased sense of satiety in the brain and reduced inflammation. In September 2024, we announced positive top-line results from our Phase 1 trial of TERN-601. The Phase 1 trial was a randomized, double-blind, placebo-controlled single and multiple-ascending dose (SAD and MAD) trial in healthy adults with obesity or who are overweight. TERN-601 was well tolerated and demonstrated dose-dependent, statistically significant placebo-adjusted mean weight loss across 240 mg, 500 mg and 740 mg doses evaluated in the 28-day MAD study, with maximum placebo-adjusted mean weight loss of 4.9% at the highest dose. TERN-601 was well tolerated with no treatment-related dose interruptions, reductions or discontinuations at any dose, despite rapid dose titration every three days. The majority of treatment emergent AEs were mild. All gastrointestinal events were mild to moderate and consistent with the GLP-1R agonist class. There were no clinically meaningful changes in liver enzymes, vital signs or electrocardiograms observed. The absence of treatment-related dose interruptions, reductions, or discontinuations with mostly mild AEs, despite rapid titration, indicates potential for further improved tolerability in subsequent studies with slower titration. The Phase 2 FALCON study for TERN-601 initiated with the first patient enrolled in March 2025. FALCON is a U.S.-based, multicenter, randomized, double-blind, placebo-controlled trial to evaluate the efficacy and safety of TERN-601 dosed once-daily. The trial will evaluate adults with obesity or who are overweight, without diabetes, with BMI ranges from ≥30 to <50 kg/m2 or ≥27 to <30 kg/m2 with at least one weight-related comorbidity. Patients will be randomized to one of four active cohorts (n=30 per cohort): 250 mg, 500 mg, 500 mg slow titration, 750 mg or placebo. The primary endpoint is percent change from baseline in body weight compared to placebo over 12 weeks. Secondary endpoints include safety, tolerability and proportion of patients achieving 5% weight loss or greater. Phase 2 12-week data are expected in the fourth quarter of 2025. Based on the Phase 1 results, we believe TERN-601 is well positioned to demonstrate a differentiated tolerability profile in a Phase 2, 12-week setting with slower titration compared to Phase 1. Phase 2 titration will range between two to four weeks at each intermediate dose before achieving the target dose. The titration design features the fewest steps and lowest fold change to target dose amongst leading oral, small-molecule GLP-1R agonists in a 12-week study. Our slower titration aims to achieve competitive 12-week weight loss, best in class tolerability and the simplest titration amongst the oral, small-molecule class.

TERN-501 is our thyroid hormone receptor beta (THR-β) agonist initially developed for metabolic dysfunction-associated steatohepatitis (MASH). Agonism of THR-β increases fatty acid metabolism via mitochondrial oxidation and affects cholesterol synthesis and metabolism. As a result, THR-β stimulation has the potential to provide broad metabolic benefits including reducing hepatic steatosis, increasing fat oxidation, and improving fibrosis and serum lipid parameters such as LDL cholesterol and triglycerides. Since announcing positive top-line data from the Phase 2a DUET trial in August 2023, we have decided to limit spend in the development of TERN-501 for MASH given the current regulatory and clinical development requirements for the indication. We continue to evaluate opportunities for TERN-501 in metabolic diseases. Based on non-clinical studies, THR-β agonism is a complementary mechanism to GLP-1 receptor antagonism, potentially providing broader metabolic and liver benefits in addition to increased weight loss. In June 2024, we highlighted preclinical data supporting TERN-501 in combination with a GLP-1R agonist for obesity at the American Diabetes Association 84th Scientific Sessions. TERN-501 significantly improved the efficacy of a GLP-1 receptor agonist in an obese mouse model by normalizing energy expenditure, resulting in greater weight loss, increased fat mass loss and relative preservation of lean mass compared to the GLP-1R agonist alone. These preclinical combination data support the potential for TERN-501 as a combination partner for injectable and oral GLP-1 agonists for use in obesity and other metabolic disorders.

TERN-800 series is our ongoing effort to discover small molecule GIPR modulators for obesity, which we believe has the potential for combination with GLP-1 receptor agonists. In preclinical studies, GIPR activation appears to reduce food intake and promote weight loss when combined with its incretin partner GLP-1. The overlapping body weight-lowering actions of both Glucose-dependent insulinotropic polypeptide (GIP) and GLP-1 suggests that combining the actions of these two peptide hormones may bolster glucose-lowering and appetite-suppressing effects beyond those observed with individual agents. We are prioritizing our discovery efforts towards nominating a GIPR antagonist development candidate based on in-house discoveries and growing scientific rationale supporting the potential of GLP-1 receptor agonist and GIPR antagonist combinations as treatments for obesity.

Since the commencement of our operations, we have devoted substantially all of our resources to research and development activities, organizing and staffing our company, business planning, raising capital, establishing and maintaining our intellectual property portfolio, conducting preclinical studies and clinical trials and providing general and administrative support for these operations.

We do not have any product candidates approved for commercial sale, and we have not generated any revenue from product sales. Our ability to generate product revenue sufficient to achieve profitability, if ever, will depend on the successful development and eventual commercialization of one or more of our product candidates which we expect, if it ever occurs, will take a number of years. We will not generate any revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for one or more of our product candidates. If we obtain regulatory approval for any of our product candidates, we expect to incur significant expenses related to developing our internal commercialization capability to support product sales, marketing and distribution.

In February 2021, we received total net proceeds of $133.0 million through our initial public offering. In August 2022, December 2022, and September 2024, we received total net proceeds of $60.7 million, $80.8 million, and $161.9 million, respectively, through securities offerings. We also have active at-the-market facilities which will allow us to issue up to approximately $156 million in our securities. We believe that our existing cash and cash equivalents will be sufficient to fund our planned operating expenses and capital expenditure requirements into 2028. We will need substantial additional funding to support our operating activities.

The following table summarizes our results of operations for the years ended December 31, 2024 and 2023:

To date, we have not generated, and do not expect to generate for the foreseeable future, any revenue from the sale of products. We may generate revenue from pre-specified clinical, regulatory and sales milestones as part of an exclusive option and license agreement for TERN-701 in greater China with Hansoh.

Research and development expenses account for a significant portion of our operating expenses and consist primarily of external and internal expenses incurred in connection with the discovery and development of our product candidates. To date, our research and development expenses have related primarily to discovery efforts, preclinical and clinical development of our product candidates. Research and development expenses are recognized as incurred and payments made prior to the receipt of goods or services to be used in research and development are capitalized until the goods or services are received. Costs for certain activities, such as manufacturing and preclinical studies and clinical trials, are generally recognized based on an evaluation of the progress to completion of specific tasks using information and data provided to us by our vendors and collaborators. Technology acquisitions are expensed or capitalized based upon the asset achieving technological feasibility in accordance with management’s assessment regarding the ultimate recoverability of the amounts paid and the potential for alternative future use.

We expect our research and development expenses to increase substantially in absolute dollars for the foreseeable future as we advance our product candidates or any other future product candidates we may develop into and through preclinical studies and clinical trials and pursue regulatory approval of our product candidates. The process of conducting the necessary clinical research to obtain regulatory approval is costly and time-consuming. The actual probability of success for our product candidates or any other future product candidate that we may develop may be affected by a variety of factors including: the safety and efficacy of our product candidates, early clinical data, investment in our clinical program, the ability of collaborators to successfully develop our licensed product candidates, competition, manufacturing capability and commercial viability. We may never succeed in achieving regulatory approval for our product candidates. As a result of the uncertainties discussed above, we are unable to determine the duration and completion costs of our research and development projects or when and to what extent we will generate revenue from the commercialization and sale of our product candidates or any other future product candidates we may develop. The duration, costs and timing of preclinical studies and clinical trials and development of our product candidates will depend on a variety of factors.

The following table summarizes our research and development expenses for the years ended December 31, 2024 and 2023:

The increase in research and development expenses for the year ended December 31, 2024, compared to the same period in 2023, was primarily due to a $4.7 million net increase in personnel-related expenses from higher executive leadership transition costs, wages, annual bonuses, and stock-based compensation. Additionally, there was a $1.9 million increase related to clinical and pre-clinical program expenses.

General and administrative expenses consist primarily of personnel-related expenses, including salaries, benefits and stock-based compensation expense, for personnel in executive, finance, accounting, business development, legal, human resources, information technology, and other administrative functions. General and administrative expenses also include corporate facility costs, depreciation and other expenses, which include direct or allocated expenses for rent and maintenance of facilities and insurance, not otherwise included in research and development expenses, as well as professional fees for legal, patent, consulting, investor and public relations, accounting and tax services.

We expect that our general and administrative expenses will increase in the foreseeable future as we increase our headcount to support the continued research and development of our programs and the growth of our business.

The decrease in general and administrative expenses for the year ended December 31, 2024, compared to the same period in 2023, was primarily due to a $7.6 million net decrease in personnel-related expenses as there were higher expenses in 2023 related to executive leadership transitions, partially offset by a $0.3 million increase in other professional services consulting.

Interest income primarily consists of interest income on our marketable securities.

Interest income for the year ended December 31, 2024 was $13.3 million compared to $12.9 million for the same period in 2023. The increase in interest income was primarily due to an increase in cash, cash equivalents and marketable securities.

Other expense, net for the year ended December 31, 2024 was less than $0.1 million compared to $0.3 million for the same period in 2023 which is consistent year over year.

Income tax expense for the year ended December 31, 2024 was $0.3 million compared to $0.2 million for the same period in 2023 which is consistent year over year.

Our primary use of cash is to fund operating expenses, which consist primarily of research and development expenditures and general and administrative expenditures. Cash used to fund operating expenses is impacted by the timing of when we pay these expenses, as reflected in the change in our outstanding accounts payable and accrued expenses.

We believe that our existing cash and cash equivalents will be sufficient to fund our planned operating expenses and capital expenditure requirements into 2028, including key clinical data readouts from our lead programs in CML and obesity. However, we continue to anticipate that our research and development expenses, general and administrative expenses and capital expenditures will remain significant to support our ongoing and planned activities. We expect to continue to incur net operating losses for at least the next several years.

We have primarily funded our operations through proceeds from the sale of shares of our common stock, convertible preferred stock and convertible promissory notes. We have devoted substantially all of our resources to research and development activities, organizing and staffing our company, raising capital, establishing and maintaining our intellectual property portfolio, conducting preclinical studies and clinical trials and providing general and administrative support for these operations.

Since our inception, we have not generated any revenue from product sales and we have incurred significant operating losses and negative cash flows from our operations. As of December 31, 2024, we had an accumulated deficit of approximately $421.5 million and cash, cash equivalents and marketable securities of $358.2 million. For the year ended December 31, 2024, we had a net loss of approximately $88.9 million and negative cash flows from operations of approximately $70.0 million.

In March 2022, we entered into a Sales Agreement with Cowen and Company, LLC (Cowen), as sales agent, pursuant to which we could offer and sell, from time to time, through Cowen, shares of our common stock having an aggregate offering price of up to $75.0 million in an at-the-market offering. The shares were offered pursuant to our shelf registration statement on Form S-3 filed with the SEC, which became effective in March 2022. This registration statement has now expired, the related Sales Agreement is terminated and we will not sell any additional shares under this at-the-market offering. There were 9,781,673 shares of our common stock sold for aggregate net proceeds of $66.6 million after deducting commissions and offering expenses pursuant to this agreement through December 31, 2024.

In May 2023, we entered into a Sales Agreement with Cowen, as sales agent, pursuant to which we have the ability to offer and sell, from time to time, through Cowen, shares of our common stock having an aggregate offering price of up to $150.0 million in an at-the-market offering. The shares are offered pursuant to our shelf registration statement on Form S-3 filed with the SEC, which became effective in February 2023. This Sales Agreement remains in effect. There were no sales of our common stock pursuant to this agreement through December 31, 2024.

In September 2024, we issued 14,064,048 shares of our common stock at a public offering price of $10.50 per share and, to certain investors in lieu of common stock, pre-funded warrants to purchase 2,380,952 shares of common stock at a public offering price of $10.4999 per pre-funded warrant in an underwritten public offering. The purchase price per share of each pre-funded warrant represents the per share public offering price for the common stock, minus the $0.0001 per share exercise price of such pre-funded warrant. Aggregate net proceeds were $161.9 million after deducting underwriting discounts and commissions and offering expenses.

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. We expect that our research and development and general and administrative costs will remain significant for the foreseeable future in connection with conducting additional preclinical studies and clinical trials for our current and future research programs and product candidates, contracting with CROs and CMOs to support preclinical studies and clinical trials, expanding our intellectual property portfolio, and providing general and administrative support for our operations. As a result, 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.

Our primary uses of cash are to fund our research and development activities, business planning, establishing and maintaining our intellectual property portfolio, hiring personnel, raising capital and providing general and administrative support for these operations.

We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the research and development of, continue or initiate clinical trials of, and seek marketing approval for, our product candidates. In addition, if we obtain marketing approval for our product candidates, we expect to incur significant commercialization expenses related to any approved products, marketing, manufacturing and distribution to the extent that such sales, marketing and distribution are not the responsibility of potential collaborators. Accordingly, we will need to obtain substantial additional funding in connection with our continuing operations. If we are unable to raise capital when needed or on attractive terms, we would be forced to delay, reduce, or eliminate our research and development programs or future commercialization efforts.

Until such time, if ever, as we can generate substantial revenues from product sales, we expect to finance our cash needs through a combination of equity offerings, debt financings, collaborations, strategic alliances and licensing arrangements. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a stockholder. Debt 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.

If we raise funds through collaborations, strategic alliances or licensing arrangements with third parties, we may have to relinquish valuable rights to our future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us.

Net cash used in operating activities for the year ended December 31, 2024 was $70.0 million and consisted primarily of our net loss of $88.9 million. This was partially offset by a $4.4 million increase from changes in operating assets and liabilities primarily attributable to the timing of expenses incurred and payments issued, and non-cash adjustments of $15.6 million of stock-based compensation, $2.1 million of net accretion on marketable securities, $0.6 million in amortization of operating lease assets and $0.3 million of depreciation.

Net cash used in operating activities for the year ended December 31, 2023 was $67.4 million and consisted primarily of our net loss of $90.2 million. This was partially offset by a $1.5 million increase from changes in operating assets and liabilities primarily attributable to the timing of expenses incurred and payments issued, and non-cash adjustments of $25.5 million of stock-based compensation, $0.3 million of depreciation, $5.2 million of net accretion on marketable securities, $0.1 million from changes in deferred tax and uncertain tax positions and $0.6 million in amortization of operating lease assets.

Net cash used in investing activities for the year ended December 31, 2024 was $12.4 million and consisted primarily of $169.9 million in purchases of investments. This was partially offset by proceeds from the sale and maturity of investments of $157.6 million.

Net cash used in investing activities for the year ended December 31, 2023 was $38.0 million and consisted primarily of $275.8 million in purchases of investments. This was partially offset by proceeds from the sale and maturity of investments of $237.8 million.

Net cash provided by financing activities for the year ended December 31, 2024 was $164.0 million and consisted of $162.3 million in proceeds from the issuance of common stock and pre-funded warrants in connection with the September 2024 Financing, $1.4 million in proceeds from stock option exercises, and $0.6 million of proceeds from the issuance of common stock under our employee stock purchase plan. This was partially offset by $0.4 million in payments of deferred offering costs.

Net cash provided by financing activities for the year ended December 31, 2023 was $42.0 million and consisted of $41.6 million in proceeds from the issuance of common stock in an at-the-market offering, $0.4 million of proceeds from the issuance of common stock under our employee stock purchase plan and $0.3 million in proceeds from stock option exercises. This was partially offset by $0.3 million in payments of deferred offering costs.

We do not have any off-balance sheet arrangements (as defined by applicable regulations of the SEC) that are reasonably likely to have a current or future material effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources.

Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, expenses and the disclosure of our contingent liabilities in our consolidated financial statements. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are described in more detail in Note 1, Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies, to our audited consolidated financial statements included elsewhere in this Annual Report on 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 audited consolidated financial statements.

Research and development costs are expensed as incurred. Research and development expenses consist of costs incurred to discover, research and develop drug candidates, including personnel expenses, stock-based compensation expense, allocated facility-related and depreciation expenses, third-party license fees and external costs, including fees paid to consultants and CROs in connection with nonclinical studies and clinical trials and other related clinical trial fees, such as for investigator grants, patient screening, laboratory work, clinical trial database management, clinical trial material management and statistical compilation and analysis. Non-refundable prepayments for goods or services that will be used or rendered for future research and development activities are recorded as prepaid expenses. Such amounts are recognized as an expense as the goods are delivered or the related services are performed, or until it is no longer expected that the goods will be delivered, or the services rendered. Costs incurred in obtaining technology licenses are charged immediately to research and development expense if the technology licensed has not reached technological feasibility and has no alternative future uses.

From time to time, we have entered into various research and development and other agreements with commercial firms, researchers, universities and others for provisions of goods and services. These agreements are generally cancelable, and the related costs are recorded as research and development expenses as incurred. We record accruals for estimated ongoing research and development costs. When evaluating the adequacy of the accrued liabilities, we analyze progress of the studies or clinical trials, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ materially from our estimates. Since inception, our historical accrual estimates have not been materially different from the actual costs.

The Jumpstart Our Business Startups Act of 2012, or the JOBS Act, permits an “emerging growth company” to take advantage of an extended transition to comply with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition provided in the JOBS Act. As a result, we will not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies and our consolidated financial statements may not be comparable to other public companies that comply with new or revised accounting pronouncements as of public company effective dates. We may choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies. The JOBS Act also exempts us from having to provide an auditor attestation of internal control over financial reporting under Sarbanes-Oxley Act Section 404(b).

We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year following the fifth anniversary of the consummation of our initial public offering, (ii) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion, (iii) the last day of the fiscal year in which we are deemed to be a “large accelerated filer” as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended, or the Exchange Act, which would occur if the market value of our common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.

Further, even after we no longer qualify as an emerging growth company, we may still qualify as a “smaller reporting company” which would allow us to take advantage of many of the same exceptions from disclosure requirements, including reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. We cannot predict if investors will find our shares of common stock less attractive because we may rely on these exemptions. If some investors find our shares of common stock less attractive as a result, there may be a less active trading market for shares of our common stock and our share price may be more volatile.

See Note 1, Nature of the Business, Basis of Presentation and Summary of Significant Accounting Policies to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for a description of recent accounting pronouncements applicable to our consolidated financial statements.

We are exposed to market risks in the ordinary course of our business, including the effects of foreign currency fluctuations and interest rate changes. Information relating to quantitative and qualitative disclosures about these market risks is set forth below.

Cash, cash equivalents and marketable securities are held primarily in bank and time deposits. The fair value of our cash and marketable securities would not be significantly affected by either an increase or decrease in interest rates due mainly to the short-term nature of these instruments.

Foreign currency risk arises from future commercial transactions and recognized assets and liabilities. A portion of our expense-related transactions are denominated in Chinese Yuan which is the functional currency of Terns Suzhou and Terns China.

The financial statements of Terns Pharmaceuticals, Inc. listed below are set forth in Item 8 of this Annual Report for the year ended December 31, 2024:

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Research and Development Expenses

Research and development costs are expensed as incurred. Research and development expenses consist of costs incurred to discover, research and develop drug candidates, including personnel expenses, stock-based compensation expense, allocated facility-related and depreciation expenses, third-party license fees and external costs, including fees paid to consultants and contract research organizations, or CROs, in connection with nonclinical studies and clinical trials and other related clinical trial fees, such as for investigator grants, patient screening, laboratory work, clinical trial database management, clinical trial material management and statistical compilation and analysis. Non-refundable prepayments for goods or services that will be used or rendered for future research and development activities are recorded as prepaid expenses. Such amounts are recognized as an expense as the goods are delivered or the related services are performed, or until it is no longer expected that the goods will be delivered, or the services rendered. Costs incurred in obtaining technology licenses are charged immediately to research and development expense if the technology licensed has not reached technological feasibility and has no alternative future uses.

The Company has from time to time entered into various research and development and other agreements with commercial firms, researchers, universities and others for provisions of goods and services. These agreements are generally cancelable, and the related costs are recorded as research and development expenses as incurred. The Company records accruals for estimated ongoing research and development costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies or clinical trials, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates are made in determining the accrued balances at the end of any reporting period. Actual results could differ materially from the Company’s estimates. Since inception, the Company’s historical accrual estimates have not been materially different from the actual costs.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities included the following:


	December 31,
(in thousands)	2024		2023
Research and development costs	$	3,388	$	2,010
Compensation and benefit costs		7,912		5,683
Accrued professional fees		1,319		855
Other		455		278
Total accrued expenses and other current liabilities	$	13,074	$	8,826

Executive Leadership Transition

In August 2023, Bryan Yoon, former chief operating officer and general counsel, and Mark Vignola, Ph.D., former chief financial officer, received retention awards payable in cash in the aggregate amount of $0.5 million for Mr. Yoon and $0.7 million for Dr. Vignola. Each retention award was payable in two installments of 33% of the award on February 1, 2024 and 67% of the award on August 1, 2024, subject to the applicable officer’s continued employment with the Company through such date. Expense was recognized on a straight-line basis over the requisite service period. During the year ended December 31, 2024, the Company recognized an expense of $0.7 million related to the retention awards. The retention awards were fully paid as of December 31, 2024. The expenses were recognized as operating expenses within the Consolidated Statements of Operations and Comprehensive Loss under General and administrative.

date and the contractual term of the option. The fair value is calculated based upon the Company’s common stock valuation on the date of the grant.

The fair value of RSUs with service conditions is based upon the Company’s common stock valuation on the date of the grant.

The Monte Carlo simulation model estimates the fair value of the RSUs with market conditions, using inputs for the common stock valuation on the date of the grant, volatility, the risk-free interest rate, and the dividend yield. Compensation expense is recognized on a straight-line basis over the derived service period commencing on the grant date. The derived service period is the median duration of the successful stock price paths to meet the price goal for each tranche as simulated in the Monte Carlo valuation model. If the related market condition is achieved earlier than its estimated derived service period, the stock-based compensation expense is accelerated, and a cumulative catch-up expense is recorded during the period in which the market condition is met.

Pre-funded Warrants

Pre-funded warrants are classified as a component of permanent stockholders’ equity within additional paid-in capital and are recorded at the issuance date using a relative fair value allocation method. The pre-funded warrants are equity classified because they (i) are freestanding financial instruments that are legally detachable and separately exercisable from the equity instruments, (ii) are immediately exercisable, (iii) do not embody an obligation for the Company to repurchase its shares, (iv) permit the holders to receive a fixed number of shares of common stock upon exercise, (v) are indexed to the Company’s common stock and (vi) meet the equity classification criteria. In addition, such pre-funded warrants do not provide any guarantee of value or return. The value of the pre-funded warrants is known at issuance, as their sales price approximates their fair value, and net proceeds from the sale are recorded as a component of additional paid-in capital.

Net Loss Per Share of Common Stock

Basic net income (loss) per share of common stock is computed by dividing the net income (loss) per share of common stock by the weighted average number of shares of common stock outstanding for the period. The weighted-average shares of common stock outstanding as of December 31, 2024 included pre-funded warrants, as the warrants were issued for minimal consideration and were immediately exercisable.

Diluted net income (loss) per share of common stock is computed by adjusting net income (loss) to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net loss per share of common stock is computed by dividing the diluted net loss by the weighted average number of shares of common stock outstanding for the period, including potential dilutive shares.

The Company reported a net loss for the years ended December 31, 2024 and 2023. In periods in which the Company reported a net loss, diluted net loss per share of common stock was the same as basic net loss per share of common stock, since dilutive shares were not assumed to have been issued if their effect is anti-dilutive. The Company excluded the following potential shares of common stock, presented based on amounts outstanding at each period end, from the computation of diluted net loss attributable to common stockholders per share of common stock for the periods indicated because including them would have had an anti-dilutive effect:


	December 31,
	2024		2023
Options to purchase common stock		10,610,387		8,349,922
Unvested restricted stock units with service conditions		547,430		365,892
Unvested restricted stock units with market conditions		150,000		—
Shares issuable under employee stock purchase plan		13,983		16,258
Total		11,321,800		8,732,072

Deferred Offering Costs

The Company capitalizes certain legal, professional accounting and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings are consummated.

After consummation of the equity financing, these costs are recorded as a reduction to the carrying value of stockholders’ equity as a reduction of additional paid-in capital or equity generated as a result of such offering. Should an in-process equity financing be abandoned, the deferred offering costs will be expensed immediately as a charge to operating expenses in the consolidated statements of operations and comprehensive loss.

Property and Equipment, net

Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives. The general range of useful lives of equipment is 3 to 5 years.

When assets are sold or retired, the cost and related accumulated depreciation are removed from the accounts, with any resulting gain or loss recorded in operating expenses in the consolidated statements of operations and comprehensive loss. Costs of repairs and maintenance are expensed as incurred.

Property and equipment, net consisted of the following:


		December 31,
(in thousands)	Estimated Useful Lives	2024			2023
Leasehold improvements	Shorter of remaining life of lease or useful life of asset	$	750		$	734
Furniture and fixtures	5 years		302			303
Computer equipment	3 years		170			162
Office equipment	5 years		145			146
Lab equipment	3 to 5 years		747			770
Property and equipment, gross			2,114			2,115
Less: Accumulated depreciation			(1,892	)		(1,609	)
Total property and equipment, net		$	222		$	506

The Company recognized depreciation expense related to these assets of $0.3 million during the years ended December 31, 2024 and 2023.

Impairment of Long-Lived Assets

The Company’s long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset or asset group may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the future undiscounted cash flows expected to be generated by the asset or asset group. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. There were no impairments of long-lived assets for any of the periods presented.

Cash Equivalents and Marketable Securities

The amortized cost and fair value of cash equivalents and marketable securities by major security type is as follows:


	December 31, 2024
(in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	$	147,566	$	—	$	—		$	147,566
U.S. government securities		196,803		175		(253	)		196,725
Total	$	344,369	$	175	$	(253	)	$	344,291

Classified as:
Cash equivalents								$	147,566
Marketable securities									196,725
Total								$	344,291

	December 31, 2023
(in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Money market funds	$	33,788	$	—	$	—		$	33,788
U.S. government securities		183,357		219		(62	)		183,514
Total	$	217,145	$	219	$	(62	)	$	217,302

Classified as:
Cash equivalents								$	33,788
Marketable securities									183,514
Total								$	217,302

The aggregate fair value of the Company’s available-for-sale marketable securities that have been in a continuous unrealized loss position for less than twelve months or twelve months or longer is as follows:


	December 31, 2024
	Less than 12 months					12 months or longer					Total
(in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. government securities	$	119,081	$	(252	)	$	2,007	$	(1	)	$	121,088	$	(253	)
Total	$	119,081	$	(252	)	$	2,007	$	(1	)	$	121,088	$	(253	)

	December 31, 2023
	Less than 12 months					12 months or longer					Total
(in thousands)	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. government securities	$	80,461	$	(62	)	$	—	$	—		$	80,461	$	(62	)
Total	$	80,461	$	(62	)	$	—	$	—		$	80,461	$	(62	)

At December 31, 2024, the Company had 11 available-for-sale marketable securities in an unrealized loss position without an allowance for credit losses. The Company does not intend to sell these securities and the Company believes it is more likely than not that marketable securities in an unrealized loss position will be held until maturity and that the Company will not be required to sell these securities before recovery of their amortized cost basis. The Company believes that an allowance for credit losses is unnecessary as the securities are of high credit quality and the decline in fair value is due to market conditions and/or changes in interest rates.

Fair Value

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The three levels of inputs that may be used to measure fair value are defined below:

•

Level 1—Quoted prices in active markets for identical assets or liabilities at the measurement date.

•

Level 2—Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•

Level 3—Unobservable inputs that are supported by little or no market activity that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The carrying values of the Company’s other assets, accounts payable and accrued expenses and other current liabilities approximate their fair values due to the short-term nature of these assets and liabilities.

The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis:


	Fair Value at December 31, 2024
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Cash in bank balances	$	13,873	$	—	$	—	$	13,873
Money market funds		147,566		—		—		147,566
Total cash and cash equivalents	$	161,439	$	—	$	—	$	161,439
Marketable securities
U.S. government securities	$	—	$	196,725	$	—	$	196,725
Total marketable securities	$	—	$	196,725	$	—	$	196,725

	Fair Value at December 31, 2023
(in thousands)	Level 1		Level 2		Level 3		Total
Cash and cash equivalents
Cash in bank balances	$	46,138	$	—	$	—	$	46,138
Money market funds		33,788		—		—		33,788
Total cash and cash equivalents	$	79,926	$	—	$	—	$	79,926
Marketable securities
U.S. government securities	$	—	$	183,514	$	—	$	183,514
Total marketable securities	$	—	$	183,514	$	—	$	183,514

Leases

In March 2019, the Company entered into a lease agreement for office space in Foster City, California which was set to expire in October 2024. In July 2024, the Company amended the lease agreement to extend for three years commencing as of November 1, 2024, and expiring on October 31, 2027. The Company has the option to extend the amended lease agreement for an additional three years. The other terms of the amendment are substantially the same as the original lease agreement and annual lease payments are approximately $0.5 million. Additionally, the Company leases office space in Shanghai and Suzhou, China.

Components of lease cost are as follows:


	Year Ended December 31,
(in thousands)	2024			2023
Operating lease cost	$	651		$	648
Short-term cost		15			17
Total lease cost	$	666		$	665

	December 31,
	2024			2023
Weighted-average remaining lease term		2.92			0.84
Weighted-average discount rate		10.00	%		6.00	%

The Company's future minimum lease payments are as follows:


(in thousands)	Operating Leases
2025	$	544
2026		545
2027		465
2028 and thereafter		—
Total lease payments		1,554
Less: Imputed interest		(207	)
Present value of lease liabilities		1,347
Less: Current portion of lease liabilities		(428	)
Total lease liabilities, non-current	$	919

Common Stock and Stock-Based Compensation

The Company is authorized to issue 150,000,000 shares of common stock and 10,000,000 shares of preferred stock. All classes of stock have a par value of $0.0001. There were no shares of preferred stock outstanding as of December 31, 2024 and 2023.

As of each balance sheet date, the Company had reserved shares of common stock for issuance in connection with the following:


	December 31,
	2024		2023
Options outstanding under incentive award plans		10,610,387		8,349,922
Unvested restricted stock units with service conditions		547,430		365,892
Unvested restricted stock units with market conditions		150,000		—
Shares available for future grant under incentive award plans		4,092,569		1,005,587
Shares available for future grant under employee stock purchase plans		1,208,837		701,671
Shares available for future grant under employment inducement award plans		2,685,001		3,291,000
Pre-funded warrants		4,190,952		9,751,500
Total shares reserved		23,485,176		23,465,572

Each share of common stock entitles the holder to one vote on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends, if any, as may be declared by the Company’s board of directors, subject to the preferential dividend rights of the convertible preferred stock. Through December 31, 2024, no cash dividends have been declared or paid by the Company.

Stock-Based Compensation Plans

The Company has three stock-based compensation plans, the 2017 Incentive Award Plan (the 2017 Plan), the 2021 Incentive Award Plan (the 2021 Plan) and the 2022 Employment Inducement Award Plan (the 2022 Inducement Plan). Although awards made under the 2017 Plan continue to be governed by its terms, the 2017 Plan was terminated at the time of our IPO and no further awards are made under this plan. The 2021 Plan, while effective, authorizes the granting of equity awards to employees and directors of the Company, as well as non-employee consultants. The 2022 Inducement Plan authorizes the granting of equity awards to newly hired employees of the Company.

2021 Incentive Award Plan

In January 2021, the Company's board of directors approved the 2021 Plan which permits the granting of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock awards, RSU awards, performance bonus awards, performance stock unit awards and other stock awards to employees, directors, officers and consultants. In February 2021, 2,400,007 shares were authorized for issuance under the 2021 Plan, which shall be cumulatively increased on the first day of each year beginning in 2022 and ending in 2031 equal to the lesser of (i) the amount equal to 5% of the number of shares issued and outstanding on the last day of the immediately preceding fiscal year or (ii) such lower number of shares as may be determined by the Company’s board of directors. The 2021 Plan is the successor to the 2017 Plan and no additional awards may be issued from the 2017 Plan. However, the 2017 Plan will continue to govern the terms and conditions of the outstanding awards granted under this plan. Shares of common stock subject to awards granted under the 2017 Plan that are forfeited or lapse unexercised and which following the effective date of the 2021 Plan are not issued under the 2017 Plan will be available for issuance under the 2021 Plan. As of December 31, 2024, 4,092,569 shares of the Company’s common stock were available for future grants under the 2021 Plan. The number of authorized shares reserved for issuance under the 2021 Plan was increased by 4,356,329 shares effective as of January 1, 2025.

The following table summarizes the stock option activity for all stock plans during the years ended December 31, 2024 and 2023:


	Number of Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term		Aggregate Intrinsic Value
						(in years)		(in thousands)
Outstanding as of December 31, 2022		4,823,928		$	8.22		8.46	$	11,721
Granted		4,269,925			9.51
Exercised		(106,176	)		2.58				925
Forfeited		(637,755	)		6.99
Outstanding as of December 31, 2023		8,349,922		$	9.04		6.82	$	2,225
Granted		4,948,813			6.69
Exercised		(244,913	)		5.91				723
Forfeited		(2,443,435	)		8.81
Outstanding as of December 31, 2024		10,610,387		$	8.07		6.66	$	1,288
Exercisable, December 31, 2024		5,151,571		$	8.91		4.05	$	931
Vested and expected to vest, December 31, 2024		10,610,387		$	8.07		6.66	$	1,288

The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had exercise prices lower than the fair value of the Company’s common stock.

As of December 31, 2024 and 2023, there was $23.4 million and $21.7 million, respectively, of unrecognized stock-based compensation expense related to unvested stock options. The unrecognized stock-based compensation expense is estimated to be recognized over a period of 2.90 years as of December 31, 2024.

The total fair value of options vested during the year ended December 31, 2024 and 2023 was $13.1 million and $20.2 million, respectively.

Restricted Stock Units with Service Conditions

RSUs with service conditions granted to employees under the plans generally vest over four years. The number of shares issued on the date the RSUs vest is net of the minimum statutory tax withholdings, which are paid in cash to the appropriate taxing authorities on behalf of the Company’s employees. The Company recognizes the stock-based compensation expense over the requisite service period of the individual grantees, which generally equals the vesting period.

The following table summarizes the RSUs with service conditions activity for all stock plans during the years ended December 31, 2024 and 2023:


	Number of Shares			Weighted Average Grant-Date Fair Value Per Share
Unvested restricted stock units as of December 31, 2022		128,280		$	4.09
Granted		308,013			9.86
Vested		(50,401	)		4.11
Forfeited		(20,000	)		7.04
Unvested restricted stock units as of December 31, 2023		365,892		$	8.79
Granted		635,650			6.16
Vested		(160,936	)		8.58
Forfeited		(293,176	)		6.39
Unvested restricted stock units as of December 31, 2024		547,430		$	7.09

As of December 31, 2024 and 2023, there was $3.0 million and $2.5 million, respectively, of unrecognized stock-based compensation expense related to RSUs with service conditions. The unrecognized stock-based compensation expense is estimated to be recognized over a period of 2.59 years as of December 31, 2024.

The total fair value of RSUs with service conditions vested during the years ended December 31, 2024 and 2023 was $1.4 million and $0.2 million, respectively.

Restricted Stock Units with Market Conditions

In March 2024, the Company granted 150,000 RSUs with market conditions, which are subject to the achievement of certain escalating stock price thresholds established by the Company's compensation committee of the board of directors. The RSUs with market conditions vest in equal installments upon the achievement of escalating stock price thresholds of $15.00 and $20.00, respectively, calculated based on the average price per share of the Company’s common stock for a period of 30 consecutive trading days equaling or exceeding the applicable price threshold, with vesting occurring as of the last day of the 30 consecutive trading day period. The escalating stock price thresholds can be met any time after the first anniversary of employment of the recipient but prior to the fourth anniversary from the date of grant.

The Company estimated the fair value of RSUs with market conditions granted using a Monte Carlo simulation model with the following assumptions:


	Year Ended December 31, 2024
Expected volatility		78.45	%
Risk-free interest rate		4.27	%
Fair value of underlying common stock	$	7.31
Weighted average grant-date fair value per share	$	5.39

As of December 31, 2024, none of the escalating stock price thresholds had been met for any of the RSUs with market conditions, resulting in no shares vested.

As of December 31, 2024, there was $0.4 million of unrecognized stock-based compensation expense related to RSUs with market conditions which is estimated to be recognized over a period of 0.81 years.

Stock-Based Compensation Expense

The Company estimated the fair value of options granted and rights to acquire stock granted under the Company’s ESPP using a Black-Scholes option pricing model with the following assumptions presented on a weighted average basis:


	Year Ended December 31,
	2024			2023
Stock Option Plans
Expected term (years)		6.04			6.05
Expected volatility		76.75	%		73.84	%
Risk-free interest rate		4.22	%		3.62	%
Fair value of underlying common stock	$	6.69		$	9.51
Weighted average grant-date fair value per share	$	4.66		$	6.41
Employee Stock Purchase Plans
Expected term (years)		1.13			1.33
Expected volatility		77.92	%		82.05	%
Risk-free interest rate		4.69	%		4.84	%
Fair value of underlying common stock	$	6.13		$	7.48
Weighted average grant-date fair value per share	$	2.89		$	3.84

Stock-based compensation expense was classified in the consolidated statements of operations and comprehensive loss as follows:


	Year Ended December 31,
(in thousands)	2024		2023
Research and development expense	$	6,709	$	5,870
General and administrative expense		8,918		19,666
Total stock-based compensation expense	$	15,627	$	25,536

Income Tax

The following table presents domestic and foreign components of income (loss) before income taxes:


	Year Ended December 31,
(in thousands)	2024			2023
U.S.	$	(89,010	)	$	(90,017	)
Foreign		417			46
Total loss before income tax	$	(88,593	)	$	(89,971	)

The following table presents the provision for income taxes:


	Year Ended December 31,
(in thousands)	2024			2023
Current
Federal	$	—		$	5
State		31			14
Foreign		523			239
Total current	$	554		$	258
Deferred
Foreign	$	(294	)	$	(19	)
Total deferred	$	(294	)	$	(19	)
Total income tax expense	$	260		$	239

The reconciliation of the U.S. federal statutory income tax benefit to the Company’s effective income tax rate is as follows:


	Year Ended December 31,
	2024			2023
Tax benefit at U.S. statutory rate		21.00	%		21.00	%
State income taxes, net of Federal tax benefit		(0.03	)		(0.02	)
Foreign income taxed at non-U.S. rates		(0.02	)		(0.07	)
Other permanent items		(0.12	)		(0.10	)
Deferred tax asset write-off		(3.47	)		(5.05	)
Stock-based compensation		(2.01	)		(0.39	)
Research and development credits		2.56			3.99
Unrecognized tax benefit		2.43			(1.21	)
162(m) limitation		(0.33	)		(0.04	)
Global intangible low-taxed income		(0.48	)		(0.05	)
Increase in valuation allowance		(19.86	)		(18.74	)
Other		0.04			0.41
		(0.29	)%		(0.27	)%

The difference between the provision for income taxes and the income tax determined by applying the statutory federal income tax rate of 21% was primarily due to the change in valuation allowance.

Significant components of the Company’s deferred tax assets and liabilities are as follows:


	As of December 31,
(in thousands)	2024			2023
Deferred tax assets:
Accruals and reserves	$	1,821		$	1,280
Intangibles		9,626			11,288
Stock-based compensation		4,783			3,730
Net operating loss		28,004			19,929
Research and development credits		8,919			6,551
Lease liability		271			114
Capitalized research and development		25,315			16,839
Other		101			72
Valuation allowance		(78,220	)		(59,621	)
Total deferred tax assets	$	620		$	182
Deferred tax liabilities:
Fixed assets	$	(12	)	$	(29	)
Operating lease assets		(258	)		(97	)
Total deferred tax liabilities	$	(270	)	$	(126	)
Net deferred tax assets	$	350		$	56

As of December 31, 2024, the Company recorded a full valuation allowance against its U.S. net deferred tax assets as it believes these deferred tax assets were not realizable on a more likely than not basis. This is based upon the weight of available evidence, including historical operating performance, and that a net loss will be expected to occur in the foreseeable future.

As of December 31, 2024, the Company had federal and state net operating loss carryforwards of approximately $132.8 million and $3.2 million, respectively. The federal net operating loss has an indefinite carryforward while the state net operating loss will begin to expire in 2041. As of December 31, 2023, the Company had federal and state net operating loss carryforwards of approximately $94.8 million and $2.2 million, respectively.

As of December 31, 2024 and 2023, the Company had federal Research & Development (R&D) credit carryforwards of approximately $9.5 million and $7.5 million, respectively, which will begin to expire in 2039. As of December 31, 2024 and 2023, the Company had California R&D credit carryforwards of approximately $4.7 million and $2.9 million, respectively, which do not expire.

Utilization of net operating loss carryforwards and credits may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. The Company does not expect any previous ownership changes, as defined under Section 382 and 383 of the Internal Revenue Code, to result in a limitation that will materially reduce the total amount of net operating loss carryforwards and credits that can be utilized.

Beginning in 2022, as part of the Tax Cuts and Job Act (TCJA) passed in 2017, the TCJA enacted tax legislation requiring U.S. R&D expenditures to be capitalized and amortized ratably over a five-year period. Expenditures attributed to research conducted outside of the U.S. must be capitalized and amortized over a 15-year period.

As of December 31, 2024, the Company has provided U.S. income taxes on all its foreign earnings. The Company continues to permanently reinvest the cash held offshore to support its working capital needs, as of end of the year. Any withholding taxes from the foreign jurisdictions in the event of a cash distribution would have been immaterial.

Segment Reporting

The Company has one reportable segment, the consolidated entity’s operations, relating to the research and development of its portfolio of small-molecule product candidates to address serious diseases including oncology and obesity.

The Company’s chief operating decision maker (the CODM), its chief executive officer, manages the Company’s operations as a single segment for the purposes of assessing performance and making operating decisions. When evaluating the Company’s financial position, the CODM reviews, as presented on a consolidated basis, cash, cash equivalents and marketable securities, total assets, cash flows from operating activities, research and development expenses by program, personnel and other, general and administrative expenses and net loss.

Cash, cash equivalents and marketable securities and total assets are presented within Item 8, Financial Statements and Supplementary Data, under Consolidated Balance Sheets. Cash flows from operating activities are presented within Item 8, Financial Statements and Supplementary Data, under Consolidated Statements of Cash Flows.

Consolidated segment loss, including segment expenses reviewed by the CODM, include the following:


	Year Ended December 31,
(in thousands)	2024			2023
Research and development expenses
External expenses by program:
TERN-701	$	15,757		$	6,627
TERN-601		15,486			7,247
TERN-501		881			17,819
Other programs		11,004			9,579
Total external expenses		43,128			41,272
Unallocated internal expenses:
Personnel-related expenses		25,732			21,017
Other expenses		1,252			1,208
Total research and development expenses		70,112			63,497
General and administrative		31,759			39,061
Total operating expenses		101,871			102,558
Loss from operations		(101,871	)		(102,558	)
Other income:
Interest income		13,289			12,901
Other expense, net		(11	)		(314	)
Total other income, net		13,278			12,587
Loss before income taxes		(88,593	)		(89,971	)
Income tax expense		(260	)		(239	)
Net loss	$	(88,853	)	$	(90,210	)

Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

As of December 31, 2024, management, with the supervision and participation of our chief executive officer and the chief financial officer, performed an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Our disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including the chief executive officer and the chief financial officer, to allow timely decisions regarding required disclosures.

Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objective and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on this evaluation, our chief executive officer and the chief financial officer concluded that, as of December 31, 2024, the design and operation of our disclosure controls and procedures were effective at a reasonable assurance level.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting for our company. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, the company's principal executive and principal financial officers and effected by the company's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of our company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our company's assets that could have a material effect on the financial statements.

Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements prepared for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management, with the participation of our chief executive officer and the chief financial officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making this assessment, our management used the criteria set forth in the Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on its assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2024 based on those criteria.

This report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting.

There were no changes during the quarter ended December 31, 2024 to our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

During the three months ended December 31, 2024, none of our directors or officers, or the Company, has entered into, modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c), in each case as defined in Item 408 of Regulation S-K.

The information required by this item will be contained in our definitive proxy statement to be filed with the SEC in connection with our 2025 annual meeting of stockholders (the Proxy Statement), which is expected to be filed not later than 120 days after the end of our fiscal year ended December 31, 2024, and is incorporated in this report by reference.

The information required by this item will be set forth in our Proxy Statement and is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The information required by this item will be set forth in our Proxy Statement and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence.

The information required by this item will be set forth in our Proxy Statement and is incorporated herein by reference.

The response to this portion of Item 15 is set forth under Part II, Item 8 above.

All schedules have been omitted because they are not required or because the required information is given in the Financial Statements or Notes thereto set forth under Item 8 above.

The exhibits listed in the Exhibit Index below are filed or incorporated by reference as part of this Annual Report.

† Certain portions of this document that constitute confidential information have been redacted in accordance with Regulation S-K, Item 601(b)(10).

^ The certification that accompanies this Annual Report on Form 10-K pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, is not deemed “filed” by the Registrant for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Amy Burroughs and Andrew Gengos as his or her true and lawful attorney-in-fact and agent, with the full power of substitution, for him or her in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant in the capacities and on the dates indicated.


特拉華	98-1448275
（州或其他司法管轄區成立或組織）	（國稅局僱主識別號）
東希爾斯代爾大道1065號, Suite 100 Foster City, 加州	94404
（主要行政辦公室地址）	(Zip代碼）


每個班級的標題	交易符號	註冊的每個交易所的名稱
普通股，每股面值0.0001美元	燕鷗	納斯達克全球精選市場


		頁面
第一部分
項目1.	業務	5
項目1A.	危險因素	40
項目10億。	未解決的員工評論	104
項目1C.	網絡安全	104
項目2.	性能	105
項目3.	法律訴訟	105
項目4.	礦山安全披露	105

第二部分
項目5.	註冊人普通股市場、相關股東事項和發行人購買股票證券	106
項目6.	保留	106
項目7.	管理層對財務狀況和經營成果的討論和分析	107
項目7A.	關於市場風險的定量和定性披露	116
項目8.	財務報表和補充數據	116
項目9.	會計和財務披露方面的變化和與會計師的分歧	148
項目9A.	控制和程序	148
項目90億。	其他信息	149
項目9 C.	有關阻止檢查的外國司法管轄區的披露	149

第三部分
項目10.	董事、執行官和公司治理	150
項目11.	高管薪酬	150
項目12.	某些受益所有人和管理層的證券所有權以及相關股東事宜	150
項目13.	某些關係和關聯交易以及董事獨立性	150
項目14.	主要會計費用和服務	150

第四部分
項目15.	展品和財務報表附表	151
項目16.	表格10-K摘要	153
	簽名	154


	安慰劑（N=9）	TERN-601 240 mg （N=9）	TERN-601 500 mg （N=9）	TERN-601 740毫克（N=9）
%重量變化較基線	-0.6%	-2.5%	-4.4%	-5.5%
%重量變化安慰劑調整 (90% CI）	-	-1.9%	-3.8%	-4.9%
探索性p值與安慰劑	-	<0.1	<0.01	<0.0001


	安慰劑（N=9）	TERN-601 240 mg （N=10）	TERN-601 500 mg （N=9）	TERN-601 740毫克（N=9）
1級（輕度）	5 (55.6%)	5 (50%)	9 (100%)	3 (33.3%)
2級（中等）	0	1 (10%)	0	6 (66.7%)
'級（嚴重）	0	0	0	0
嚴重不良事件	0	0	0	0


☒	根據1934年證券交易法第13或15（d）條提交的年度報告


☐	根據1934年證券交易法第13或15（d）條提交的過渡期過渡報告到


大型加速文件夾	☐	加速編報公司	☐

非加速歸檔	☒	小型上市公司	☒

新興成長型公司	☒


Report of Independent Registered Public Accounting Firm (PCAOB ID: 42)	118

Consolidated Balance Sheets	119

Consolidated Statements of Operations and Comprehensive Loss	120

Consolidated Statements of Stockholders’ Equity	121

Consolidated Statements of Cash Flows	122

Notes to Consolidated Financial Statements	123


	Common Stock				Additional Paid-in			Accumulated Other Comprehensive			Accumulated			Total Stockholders’
	Shares		Amount		Capital			Loss			Deficit			Equity
Balances at December 31, 2022		53,723,171	$	5	$	520,178		$	(822	)	$	(242,418	)	$	276,943
Issuance of common stock in at-the-market offering		5,659,045		1		41,610			—			—			41,611
Issuance of common stock in connection with exercise of pre-funded warrants		4,878,446		—		—			—			—			—
Exercise of stock options		106,176		—		274			—			—			274
Vesting of restricted stock units with service conditions		50,401		—		—			—			—			—
Issuance of common stock under employee stock purchase plan		159,480		—		410			—			—			410
Stock-based compensation expense		—		—		25,536			—			—			25,536
Unrealized gain on available-for-sale securities		—		—		—			671			—			671
Foreign exchange translation adjustment		—		—		—			132			—			132
Net loss		—		—		—			—			(90,210	)		(90,210	)
Balances at December 31, 2023		64,576,719	$	6	$	588,008		$	(19	)	$	(332,628	)	$	255,367
Issuance of common stock and pre-funded warrants, net of issuance costs of $394		14,064,048		2		161,916			—			—			161,918
Issuance of common stock in connection with exercise of pre-funded warrants		7,941,366		1		(1	)		—			—			—
Exercise of stock options		244,913		—		1,448			—			—			1,448
Vesting of restricted stock units with service conditions		160,936		—		—			—			—			—
Issuance of common stock under employee stock purchase plan		138,601		—		623			—			—			623
Stock-based compensation expense		—		—		15,627			—			—			15,627
Unrealized loss on available-for-sale securities		—		—		—			(235	)		—			(235	)
Foreign exchange translation adjustment		—		—		—			(25	)		—			(25	)
Net loss		—		—		—			—			(88,853	)		(88,853	)
Balances at December 31, 2024		87,126,583	$	9	$	767,621		$	(279	)	$	(421,481	)	$	345,870


		Incorporated by Reference
Exhibit Number	Exhibit Description	Form	Date	Number	Filed Herewith

3.1	Amended and Restated Certificate of Incorporation.	8-K	2/9/2021	3.1

3.2	Amended and Restated Bylaws.	8-K	10/10/2023	3.1

4.1	Reference is made to Exhibits 3.1 through 3.2.

4.2	Form of Common Stock Certificate.	S-1/A	2/1/2021	4.2

4.3	Description of Securities.				X

4.4	Form of Pre-Funded Warrant (August 2022).	8-K	8/16/2022	4.1

4.5	Form of Pre-Funded Warrant (September 2024).	8-K	9/12/2024	4.1

4.6	Amended and Restated Investors’ Rights Agreement, dated December 29, 2020, by and among the Registrant and the investors listed therein.	S-1	1/15/2021	10.1

10.1	Lease, dated March 1, 2019, by and between the Registrant and DWF IV Century Plaza, LLC.	S-1	1/15/2021	10.2

10.2(a)#	2017 Equity Incentive Plan, as amended.	S-1	1/15/2021	10.4(a)

10.2(b)#	Form of Stock Option Grant Notice and Stock Option Agreement under 2017 Equity Incentive Plan, as amended.	S-1	1/15/2021	10.4(b)

10.2(c)#	Form of Early Exercise Stock Option Grant Notice and Stock Option Agreement under 2017 Equity Incentive Plan, as amended.	S-1	1/15/2021	10.4(c)

10.2(d)#	Form of International Stock Option Grant Notice and Stock Option Agreement under 2017 Equity Incentive Plan, as amended.	S-1	1/15/2021	10.4(d)

10.3(a)#	2021 Incentive Award Plan.	S-8	2/12/2021	99.2(a)

10.3(b)#	Form of Stock Option Grant Notice and Stock Option Agreement under the 2021 Incentive Award Plan.	S-1/A	2/1/2021	10.5(b)

10.3(c)#	Form of Restricted Stock Award Grant Notice and Restricted Stock Award Agreement under the 2021 Incentive Award Plan.	S-1/A	2/1/2021	10.5(c)

10.3(d)#	Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the 2021 Incentive Award Plan.	S-1/A	2/1/2021	10.5(d)

10.4#	2021 Employee Stock Purchase Plan.	S-8	2/12/2021	99.3



10.5#	Amended and Restated Employment Agreement by and between the Registrant and Erin Quirk, M.D.	10-K	3/14/2024	10.6#

10.6#	Amended and Restated Employment Agreement by and between the Registrant and Bryan Yoon, Esq.	10-K	3/14/2024	10.8#

10.7#	Employment Agreement by and between the Registrant and Jill M. Quigley.	10-K	3/14/2024	10.9#

10.8#	Amended and Restated Employment Agreement by and between the Registrant and Mark Vignola.	10-K	3/14/2024	10.10#

10.9#	Second Amended and Restated Non-employee Director Compensation Program, as amended.				X

10.10	Form of Indemnification Agreement for directors and officers.	S-1/A	2/1/2021	10.11

10.11†	Assignment Agreement, dated as of June 24, 2019, by and among Terns Pharmaceuticals, Inc. and Vintagence Biotechnology Ltd.	S-1	1/15/2021	10.15

10.12†	Exclusive Option and License, dated as of July 27, 2020, by and among Terns Pharmaceuticals, Inc., Terns, Inc., CaspianTern LLC, Hansoh (Shanghai) Healthtech Co., Ltd. and Jiangsu Hansoh Pharmaceutical Group Company Ltd.	S-1	1/15/2021	10.16

10.13(a)#	2022 Employment Inducement Award Plan.	10-Q	11/9/2022	10.1(a)#

10.13(b)#	Form of Stock Option Grant Notice and Stock Option Agreement under the 2022 Employment Inducement Award Plan.	10-Q	11/9/2022	10.1(b)#

10.13(c)#	Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the 2022 Employment Inducement Award Plan.	10-Q	11/9/2022	10.1(c)#

10.13(d)#	Amendment No. 1 to 2022 Employment Inducement Award Plan.	10-Q	11/14/2023	10.2#

10.14	Sales Agreement, dated May 15, 2023, by and between Terns Pharmaceuticals, Inc. and Cowen and Company, LLC.	8-K	5/15/2023	1.1

10.15#	Separation Agreement between Terns, Inc. and Bryan Yoon dated July 23, 2024.	10-Q	11/12/2024	10.1#

10.16#	Transition Agreement between Terns, Inc. and Mark Vignola dated July 23, 2024.	10-Q	11/12/2024	10.2#

10.17#	Amendment No. 2 to 2022 Employment Inducement Award Plan.	10-Q	11/12/2024	10.3#

10.18	First Amendment to Office Lease dated July 1, 2024.	8-K	7/3/2024	10.1

10.19#	Separation Agreement between Terns, Inc. and Erin Quirk dated May 7, 2024.	10-Q	8/5/2024	10.1#

10.20#	Employment Agreement by and between the Registrant and Amy Burroughs dated February 7, 2024.	10-Q	5/13/2024	10.2#

10.21#	Reference is made to Exhibit 97.0.

19.1	Terns Pharmaceuticals, Inc. Insider Trading Policy.				X

21.1	List of subsidiaries.	S-1	1/15/2021	21.1

23.1	Consent of Ernst & Young LLP, independent registered public accounting firm.				X

24.1	Power of Attorney. Reference is made to the signature page hereto.				X


31.1	Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.				X

31.2	Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.				X

32.1^	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.				X

32.2^	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.				X

97.0#	Clawback Policy.	10-Q	11/14/2023	10.3#

101.INS	Inline XBRL Instance Document				X

101.SCH	Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents				X

104	Cover Page Interactive Data File (embedded within the Inline XBRL document)				X


	TERNS PHARMACEUTICALS, INC.

Date: March 20, 2025	By:	/s/ Amy Burroughs
		Amy Burroughs
		Chief Executive Officer


Signature	Title	Date

/s/ Amy Burroughs	Chief Executive Officer and Director (Principal Executive Officer)	March 20, 2025
Amy Burroughs		March 20, 2025


/s/ Andrew Gengos	Chief Financial Officer (Principal Financial and Accounting Officer)	March 20, 2025
Andrew Gengos		March 20, 2025

/s/ David Fellows	Chairman of the Board of Directors	March 20, 2025
David Fellows	Chairman of the Board of Directors	March 20, 2025

/s/ Robert Azelby	Director	March 20, 2025
Robert Azelby	Director	March 20, 2025

/s/ Jeffrey Kindler	Director	March 20, 2025
Jeffrey Kindler, Esq.	Director	March 20, 2025

/s/ Hongbo Lu	Director	March 20, 2025
Hongbo Lu, Ph.D	Director	March 20, 2025

/s/ Jill Quigley	Director	March 20, 2025
Jill Quigley, Esq.	Director	March 20, 2025

/s/ Radhika Tripuraneni	Director	March 20, 2025
Radhika Tripuraneni, M.D., M.P.H.	Director	March 20, 2025

/s/ Heather Turner	Director	March 20, 2025
Heather Turner, J.D.	Director	March 20, 2025