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Financial report summary
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AMGEN • Sutro Biopharma • Immunome • Schrodinger • Adimab • Recursion Pharmaceuticals Inc - Ordinary Shares • Zymergen • Bruker Cellular Analysis • AbCellera Biologics • Harpoon TherapeuticsRisks
- Our current business has a limited operating history, which may make it difficult to evaluate our business and predict our future performance.
- We have incurred significant losses since inception, we expect to incur losses in the future and we may not be able to generate sufficient revenue to achieve and maintain profitability.
- We will need to raise additional capital to fund our operations and improve our platform. If we are unable to raise additional capital on terms acceptable to us or at all, we may not be able to compete successfully, which would harm our business, operations, and financial condition.
- Substantially all of our historical revenue is related to partnered drug creation activities, and we have not demonstrated the ability to enter into a sufficient number of partnerships providing for long-term license arrangements under which we are entitled to receive milestone payments or royalties on net product sales. We have not received any such milestone or royalty revenues to date, and it may be years before we realize any such revenues, if at all.
- Our commercial success depends on the technological capabilities of our Integrated Drug Creation platform and the advancement of our internal asset programs.
- We are substantially dependent on the successful application of our Integrated Drug Creation platform to initiate and advance partnered programs and to develop our internal asset programs that can be further developed by our current or future partners.
- We rely and expect to continue to rely on third parties to conduct our preclinical studies and any eventual clinical trials. If those third parties do not perform as contractually required, fail to satisfy legal or regulatory requirements, miss expected deadlines or the relationship terminates prematurely, the development of our internal asset programs could be delayed, more costly or unsuccessful, and the programs may never obtain regulatory approval or commercialization.
- If we do not achieve our projected development goals in the timeframes we announce and expect, the commercialization of our programs and validation of our platform technology may be delayed and our expenses may increase and, as a result, our stock price may decline.
- Our future success significantly depends on the eventual approval and commercialization of biologic drugs developed under our partnerships for which we may have no control over the clinical development plan, regulatory strategy or commercialization efforts.
- If we cannot maintain our current relationships with partners, fail to expand our relationships with our current partners, or if we fail to enter into new relationships, our future operating results would be adversely affected as a general matter.
- Our revenue under our drug creation and other partner agreements for any particular period, or on an absolute basis, can be difficult to forecast.
- We expect to make significant investments in our continued research and development of new technology development and platform expansion, which may not be successful.
- We may not be successful in our efforts to identify or create internally-generated drug candidates.
- The failure of our drug creation partners to meet their contractual obligations to us could adversely affect our business.
- Our partners may not achieve projected discovery and development milestones and other anticipated key events in the expected timelines or at all, which could have an adverse impact on our business and our anticipated revenue.
- Our partners have significant discretion in determining when and whether to make announcements, if any, about the status of our partnerships, including about clinical developments and timelines for advancing collaborative programs, and the price of our common stock may decline as a result of announcements of unexpected or negative results or developments.
- Biologic drug development is inherently uncertain, and it is possible that our technology may not succeed in discovering appropriate molecules or producing cell lines. Even if we do succeed, it is possible that none of the drug candidates created using our platform, if any, that are further developed by our partners will achieve development or regulatory milestones, including marketing approval, or become viable commercial technologies, on a timely basis or at all, which would harm our ability to generate revenue.
- If we or our partners experience any of a number of possible unforeseen or negative events in connection with preclinical or clinical development, regulatory approval or commercialization of product candidates generated through our platform, this could negatively affect our revenue
- opportunity for that program, and/or have broader deleterious effects on our reputation and future partnership prospects.
- The biopharmaceutical platform technology market is highly competitive, and if we cannot compete successfully with our competitors, we may be unable to increase or sustain our revenue, or achieve and sustain profitability.
- We face competition from entities that have made substantial investments into the rapid development of novel treatments for the therapeutic indications in which we are engaged in drug creation partnerships and internal asset programs, including large and specialty pharmaceutical and biotechnology companies.
- The market for our platform, including potential partners and potential investors, may be skeptical of the viability and benefits of our technology platform because it is based on novel and complex synthetic biology and AI technologies.
- The medical insurance coverage and reimbursement status of newly approved therapeutics is uncertain. Failure to obtain or maintain adequate coverage and reimbursement for current or future products and services could limit our partners’ ability to successfully commercialize product candidates generated using our platform, which would decrease our ability to generate revenue.
- Healthcare reform efforts aimed at lowering the price of biopharmaceutical products may impact our ability to maintain sufficient profits.
- Our business could become subject to government regulation, and the regulatory approval and maintenance process may be expensive, time-consuming and uncertain both in timing and in outcome.
- We rely on a limited number of suppliers for laboratory equipment and materials and may not be able to find replacements or transition to alternative suppliers on a timely basis, or at all.
- Our Integrated Drug Creation platform may not meet the expectations of our partners, which means our business, financial condition, results of operations and prospects could suffer.
- We will need to develop and expand our workforce, commercial infrastructure and laboratory operations to support anticipated growth in demand for our drug creation programs, and we may encounter difficulties in managing this development and expansion.
- The loss of any member of our senior leadership team or our inability to attract and retain highly skilled scientists and business development professionals could adversely affect our business.
- Our organizational realignment and the associated workforce reduction announced in September 2023 may not result in the full anticipated savings and may disrupt operations.
- We in the past have, and in the future may, make technology acquisitions, acquire businesses or assets, or make investments in other companies or technologies that could negatively affect our
- operating results, dilute our stockholders’ ownership, increase our debt or cause us to incur significant expense.
- We may be subject to laws that generally govern the biopharmaceutical industry.
- Our equipment financing agreements may contain covenants that restrict our operating activities, and we may be required to repay the outstanding indebtedness in an event of default, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
- Our inability to collect on our accounts receivable by a significant number of partners may have an adverse effect on our business, financial condition and results of operations.
- If our operating facility becomes damaged or inoperable or we are required to vacate our facility, our ability to conduct and pursue our drug creation and internal research and development efforts may be jeopardized.
- Our current and future use of artificial intelligence (AI) present emerging risks and challenges related to this technology.
- We depend on our information technology systems, and any failure of these systems could harm our business.
- International expansion of our business exposes us to business, regulatory, political, operational, financial and economic risks associated with doing business outside of the United States.
- Our business activities are subject to the FCPA and other anti-bribery and anti-corruption laws of the United States and other countries in which we operate, as well as U.S. and certain foreign export controls and trade sanctions. Violations of such legal requirements could subject us to liability.
- We use biological and hazardous materials that require considerable expertise and expense for handling, storage and disposal and may result in claims against us.
- Public health crises such as pandemics or similar outbreaks could cause a disruption of the development of our platform technologies, and adversely impact our business.
- We rely and expect in the future to rely on a limited number of outside parties to perform the cGMP manufacturing for preclinical development, clinical development and commercialization of any biologic product candidates produced using our technology. Limitations in this global cGMP manufacturing capacity could delay or prevent preclinical development, clinical development and/or commercialization efforts.
- Risks Related to Our Intellectual Property
- If we are unable to obtain and maintain sufficient intellectual property protection for our technologies, including for our cell line and expression technologies, generative deep learning technology, proprietary assays and techniques, and antibody and target discovery technology, or if the scope of the intellectual property protection obtained is not sufficiently broad, our competitors could develop and commercialize technologies similar or identical to ours, and our ability to successfully leverage our technologies may be impaired.
- Changes in patent law in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our technologies.
- Issued patents covering our platform and technologies could be found invalid or unenforceable if challenged.
- We may come to rely on in-licenses from third parties. If we were to lose these rights, our business could be materially adversely affected, our ability to develop improvements to our platform or technologies could be negatively and substantially impacted, and if disputes arise, we could be subjected to future litigation as well as the potential loss of or limitations on our ability to incorporate the technology covered by these license agreements.
- If we cannot acquire or license rights to use technologies on reasonable terms or if we fail to comply with our obligations under such agreements, we may not be able to commercialize new technologies or services in the future and our business could be harmed.
- We may not be able to protect our intellectual property rights throughout the world.
- Intellectual property rights do not necessarily address all potential threats to our competitive advantage.
- If we are unable to protect the confidentiality of our information and our trade secrets, the value of our technologies could be materially adversely affected, and our business could be harmed.
- We may be subject to claims that our employees, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties or that our employees have wrongfully used or disclosed alleged trade secrets of their former employers.
- We may not be able to protect and enforce our trademarks and trade names, or build name recognition in our markets of interest thereby harming our competitive position.
- We may be subject to claims challenging the inventorship of our patents and other intellectual property.
- If we become involved in patent litigation or other proceedings related to a determination of rights, we could incur substantial costs and expenses, substantial liability for damages or be required to stop our development and commercialization efforts of our technologies.
- Obtaining and maintaining our patent protection depends on compliance with various required procedures, document submissions, fee payments and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.
- Patent terms may be inadequate to protect our competitive position with our technology for an adequate amount of time.
- Our share price may be volatile, and you could lose all or part of your investment.
- We in the past have had, and in the future may have, a material weakness in our internal control over our financial reporting process. If we are unable to remediate an identified material weakness, we may not be able to accurately or timely report our financial condition or results of operations.
- We are obligated to develop and maintain proper and effective internal control over financial reporting. These internal controls may not be determined to be effective, which may adversely affect investor confidence in our company and, as a result, the value of our common stock.
- We continue to identify key business metrics to evaluate our business and technology, measure our performance, identify trends affecting our business, formulate financial projections and make strategic decisions, and any such metrics may not accurately reflect all aspects of our business needed to make such evaluations and decisions, in particular as our business continues to grow.
- Future sales and issuances of our common stock or rights to purchase common stock could result in additional dilution of the percentage ownership of our stockholders and could cause our share price to fall.
- We do not intend to pay dividends on our common stock, so any returns will be limited to the value of our common stock.
- Our principal stockholders and management own a significant percentage of our shares and will be able to exert significant influence over matters subject to stockholder approval.
- Future sales of our common stock in the public market could cause our share price to fall.
- An active trading market for our common stock may not continue to be maintained.
- Provisions in our corporate charter documents and under Delaware law could make an acquisition of us more difficult and may prevent attempts by our stockholders to replace or remove our current management.
- Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware is the exclusive forum for certain disputes between us and our stockholders and that the federal district courts of the United States will be the exclusive forum for certain actions under federal securities laws, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
- Our ability to use our net operating losses and certain other tax attributes may be limited.
- Changes in tax law may adversely affect us or our investors.
- If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline.
- Unfavorable U.S. or global economic conditions could adversely affect our business, financial condition or results of operations.
- Adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults, or non-performance by financial institutions or transactional counterparties, could adversely affect our current and projected business operations and our financial condition and results of operations.
- Raising additional capital may cause dilution to our existing stockholders, restrict our operations or require us to relinquish rights to our technologies.
- Our employees, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements, and insider trading.
- Our insurance policies are expensive and protect us only from some business risks, which leaves us exposed to significant uninsured liabilities.
- Security breaches, loss of data and other disruptions could compromise sensitive information related to our business or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.
- Social media platforms present new risks and challenges to our business.
- We are an emerging growth company, and the reduced reporting requirements applicable to emerging growth companies could make our common stock less attractive to investors.
- We have incurred and will continue to incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.
- Our results of operations and financial condition could be materially adversely affected by changes in accounting principles.
- If our estimates or judgments relating to our critical accounting policies prove to be incorrect or financial reporting standards or interpretations change, our results of operations could be adversely affected.
- Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud.