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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

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Commission file number 001-37558

Nabriva Therapeutics plc

(Exact name of registrant as specified in its charter)

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+353 1649 2000

(Registrant'sRegistrant’s telephone number, including area code)

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Securities registered pursuant to Section 12(b) of the Act:

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Securities registered pursuant to Section 12(g) of the Act:None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o◻  No ý⌧

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o◻  No ý⌧

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesý⌧ No o◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý⌧  No o◻

         Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large“large accelerated filer," "accelerated” “accelerated filer," "smaller” “smaller reporting company"company” and "emerging“emerging growth company"company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ý◻

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule12b-2 of the Act). Yes o☐  No ý⌧

As of June 29, 201830, 2021 (the last business day of the registrant'sregistrant’s most recently completed second fiscal quarter), the aggregate market value of the registrant'sregistrant’s voting securities held by non-affiliates was approximately $141.7$67.5 million based on the last reported sale price of the registrant'sregistrant’s ordinary shares on June 29, 2018.30, 2021. As of February 28, 2019,2022, the registrant had 69,699,72260,525,366 ordinary shares outstanding.

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CAUTIONARY NOTE REGARDINGFORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements that involve substantialimportant risks and uncertainties. All statements contained in this Annual Report, other than statements of historical fact, including statements regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management, are forward-looking statements. The words "anticipate, "around" "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue,"“anticipate, “around” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. The forward-looking statements in this report include, among other things, statements about:

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the timing of receiving marketing approval of lefamulin, CONTEPO and other product candidates, including the completion of any post-marketing requirements with respect to any marketing approval we may obtain;



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our expectations regarding how far into the future our cash on hand will fund our ongoing operations;



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our ability to satisfy interest and principal payments under our debt facility with Hercules Capital, Inc., or Hercules;



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our ability to comply with the restrictive covenants under our debt facility with Hercules;



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the potential receipt of revenues from future sales of lefamulin or CONTEPO;



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our plans to pursue development of lefamulin for additional indications other than community-acquired bacterial pneumonia, or CABP, and of CONTEPO for additional indications other than in complicated urinary tract infections, or cUTIs;



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our plans to pursue development of other product candidates;



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our expectations with respect to the potential financial impact, synergies, growth prospects and benefits of our acquisition of Zavante Therapeutics, Inc., or Zavante, which was completed on July 24, 2018, or the Acquisition, pursuant to the Agreement and Plan of Merger dated July 23, 2018, or the Merger Agreement, by and among Nabriva, Zuperbug Merger Sub I, Inc., or Merger Sub I, Zuperbug Merger Sub II, Inc., or Merger Sub II, Zavante and the Zavante stockholder representative, including the potential realization of the expected benefits from the Acquisition;



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our expectations with respect to milestone payments pursuant to the Merger Agreement and expectations with respect to potential advantages of CONTEPO or any other product candidate that we acquired in connection with the Acquisition;



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our ability to successfully integrate Zavante's operations into our business;



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our ability to establish and maintain arrangements for manufacture of our product candidates;



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our sales, marketing and distribution capabilities and strategy;



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our ability to successfully commercialize lefamulin, CONTEPO and our other product candidates;



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the potential advantages of lefamulin, CONTEPO and our other product candidates;



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our estimates regarding the market opportunities for lefamulin, CONTEPO and our other product candidates;



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the rate and degree of market acceptance and clinical benefit of lefamulin for CABP, CONTEPO for cUTI and our other product candidates;



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our ability to establish and maintain collaborations in the U.S. our outside the U.S;

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the future development

Table of lefamulin in the greater China region;

We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. We have included important factors

You should refer to “Risk Factor Summary” and “Risk Factors” in the cautionary statements included inPart I, Item 1A of this Annual Report particularly in the "Risk Factors" sectionfor a discussion of this Annual Report,important factors that we believe could cause actual results or events to differ materially from the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.

        You should read this Annual Report and the documents that we have filed as exhibits to this Annual Report completely and with the understanding that our actual future results may be materially different from what we expect. We do not assume any obligation to update any forward-looking statements, except as required by applicable law.

        ThisThroughout this Annual Report includes statistical and other industry and market data that we obtained from industry publications and research, surveys and studies conducted by third parties. Industry publications and third-party research, surveys and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information.

SPECIAL NOTE REGARDING THE REDOMICILIATION

        On June 23, 2017, Nabriva Therapeutics plc, a public limited company organized under the laws of Ireland, or Nabriva Ireland, became the successor issuer to Nabriva Therapeutics AG, a stock corporation (Aktiengesellschaft) organized under the laws of Austria, or Nabriva Austria, for certain purposes under both the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, or the Exchange Act. Such succession occurred following the conclusion of a tender offer

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related to the exchange of American Depositary Shares and common shares of Nabriva Austria for ordinary shares of Nabriva Ireland, which resulted in Nabriva Ireland, a new Irish holding company, becoming the ultimate holding company of Nabriva Austria (the predecessor registrant and former ultimate holding company) and its subsidiaries, which we refer to as the Redomiciliation Transaction. On October 19, 2017, Nabriva Austria was converted into a limited liability company under Austrian law and renamed Nabriva Therapeutics GmbH.

        Unlesson Form 10-K, unless the context requires otherwise, all references to “Nabriva,” “the Company,” we,” “our,” “us” or similar terms refer to Nabriva Therapeutics plc, together with its consolidated subsidiaries.

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SPECIAL NOTE

On December 2, 2020, our board of directors effected a one-for-ten reverse stock split of our ordinary shares, or the Reverse Stock Split. As a result of the Reverse Stock Split, every ten ordinary shares of $0.01 each (nominal value) in the authorized and unissued and authorized and issued share capital of the company were consolidated into one ordinary Share of $0.10 each (nominal value), and the nominal value of each ordinary share was subsequently immediately reduced from $0.10 to $0.01 nominal value per share. All outstanding stock options, restricted stock units and warrants entitling their holders to purchase or acquire ordinary shares were adjusted as a result of the Reverse Stock Split. Accordingly, all ordinary share, common share, equity award, warrant and per share amounts in this Annual Report on Form 10-K have been adjusted to "Nabriva," "the Nabriva Group," "the Company," "we," "ours," "us," or similar terms on or priorreflect the Reverse Stock Split.

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RISK FACTOR SUMMARY

Our business is subject to June 23, 2017 (the effective datea number of risks of which you should be aware before making an investment decision. Below we summarize what we believe are the Redomiciliation Transaction), refer toprincipal risk factors but these risks are not the only ones we face, and you should carefully review and consider the full discussion of our predecessor, Nabriva Therapeutics AG,risk factors in the “Risk Factors” in Part I, Item 1A, together with its subsidiaries.the other information in this Annual Report.

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ITEM 1. BUSINESS

Overview

We are a biopharmaceutical company engaged in the commercialization and research and development of novel anti-infective agents to treat serious infections. We have the commercial rights to two approved products, SIVEXTRO and XENLETA, as well as one development product candidates that have been submitted to the U.S. Food and Drug Administration, or the FDA, for approval: lefamulin, potentially the first pleuromutilin antibiotic available for oral and intravenous (or IV) administration in humans, for the treatment of community-acquired bacterial pneumonia, or CABP and CONTEPO, a potentially first-in-class epoxide antibiotic for IV use in the United States for complicated urinary tract infections, or cUTI.candidate, CONTEPO. We may potentially develop lefamulinXENLETA and CONTEPO for additional indications. Both lefamulinthe oral and intravenous, or IV, formulations of XENLETA formulations and CONTEPO were granted Qualified Infectious Disease Product, or QIDP, and Fast Track designation by the FDA, enablingFDA. Incentives for QIDP status include an additional five years of exclusivity, in addition to any other exclusivity periods, as well as fast track and priority review status, for which both XENLETA formulations and CONTEPO are eligible.

SIVEXTRO

SIVEXTRO is a novel oxazolidinone class antibiotic to treat susceptible Gram-positive pathogens including MRSA, one of the New Drug Applications,serious public health threats identified by the CDC. Available in both IV and oral formulations, SIVEXTRO was approved by the FDA for the treatment of adults with ABSSSI, such as cellulitis, wound infections, and Erysipelas and in 2020 the label was expanded to include adolescents 12 years of age and older.

On July 15, 2020, we announced that we entered into a Sales Promotion and Distribution Agreement, the Distribution Agreement, with MSD International GmbH, or MSD, and Merck Sharp & Dohme Corp., or the NDAsSupplier, each a subsidiary of Merck & Co. Under the Distribution Agreement, MSD appointed us as its sole and exclusive distributor of certain products containing tedizolid phosphate as the active ingredient previously marketed and sold by Supplier and MSD under the FDA.trademark SIVEXTRO® for injection, intravenous and oral use in the United States and its territories. SIVEXTRO is an oxazolidinone-class antibacterial indicated in adults and patients 12 years of age and older for the treatment of ABSSSI caused by susceptible isolates of the following Gram-positive microorganisms: Staphylococcus aureus, including MRSA and methicillin-susceptible, or MSSA, isolates, Streptococcus pyogenes, Streptococcus agalactiae, Streptococcus anginosus group (including Streptococcus anginosus, Streptococcus intermedius and Streptococcus constellatus), and Enterococcus faecalis.

LefamulinUnder the Distribution Agreement and subject to the fulfillment of certain conditions, including our engaging sufficient sales representatives, restrictions relating to travel and physician office access in the United States and its territories, or SIVEXTRO Territory, due to COVID-19 having continued to decrease in a sufficient portion of the SIVEXTRO Territory so as not to hinder the successful detailing of SIVEXTRO, we have been granted the right to initially promote SIVEXTRO in the SIVEXTRO Territory and, upon satisfaction of additional conditions, including an increase in the number of our sales representatives, the right to exclusively distribute SIVEXTRO in the SIVEXTRO Territory, including the sole right and responsibility to fill orders with respect to SIVEXTRO in the SIVEXTRO Territory. In April 2021, we satisfied those conditions, including the requirement to increase the number of sales representatives, and began filling orders of SIVEXTRO with our own Nabriva National Drug Code, or NDC.

        LefamulinSIVEXTRO was the primary driver of our topline revenues in 2021, and we believe that will continue in the near term. We believe SIVEXTRO will serve as the foundation of our portfolio in the near-term, and serve as the primary source of our revenue as we continue to raise awareness around and establish other products in our portfolio. We plan to maximize our resource allocation in the near-term to drive SIVEXTRO sales back to historical prescription trends in order to effectively and efficiently drive our operating cash flow.

XENLETA

Discovered and developed by our team, XENLETA is a semi-synthetic pleuromutilin antibiotic discovered and developed by our team withthat is the potential to be first-in-classfirst in its class for intraveneous, or IV, and oral administration in humans. It inhibitsXENLETA is designed to inhibit the synthesis of a specific protein on the bacterial protein,ribosome, which is required for bacteria to grow, by binding with high affinity and specificity at molecular targets that are different than other currently available antibiotic classes. classes causing cell death.

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Based on results from two global, Phase 3 clinical trials, we believe lefamulinXENLETA is well-positioned for use as first-line monotherapy for the treatment of CABP due to its novel mechanism of action, short five-day course of therapy for oral XENLETA, targeted spectrum of activity, resistance profile, achievement of substantial drug concentrations in lung tissue and fluid, availability of oral and IV formulations and a generally well-tolerated profile. We believe lefamulinXENLETA represents a potentially important new treatment option for the five to six million adults in the United States diagnosed with CABP each year.

        We submitted two NDAs to the FDA for the oral and IV formulations of lefamulin for the treatment of CABP in December 2018. The FDA has granted us a Prescription Drug User Fee Act, or PDUFA, target action date of August 19, 2019 for lefamulin. We plan to submit a marketing authorization application for lefamulin in Europe in the first half of 2019. The two NDAs for lefamulin are supported by two pivotal, Phase 3 clinical trials (known as LEAP 1 and LEAP 2) that evaluated the safety and efficacy of IV and oral lefamulin compared to moxifloxacin in the treatment of adults with CABP, including the option to switch from IV to oral administration and a short course oral treatment with lefamulin. In both LEAP 1 and LEAP 2, lefamulin was demonstrated to be non-inferior to moxifloxacin, and met both the FDA and European Medicines Agency, or EMA primary and secondary efficacy endpoints for the treatment of CABP. Lefamulin was also shown to be generally well-tolerated when administered both orally and intravenously.

We believe that pleuromutilin antibiotics can help address the major public health threat posed by bacterial resistance, which the World Health Organization, or WHO, characterized in 2017 as one of the biggest threats to human health. Increasing resistance to antibiotics currently used to treat CABP is a growing concern and has become an important issue infor clinicians selecting the appropriate initial antibiotic treatment for patients prior to determining the specific microbiological cause of the infection, referred to as empiric treatment. For example, the U.S. Centers for Disease Control and Prevention, or CDC, has classifiedStreptococcus pneumoniae, currently the most common respiratory pathogen, as a serious threat to human health as a result of increasing resistance to currently available antibiotics. In a recent retrospective cohort study of Streptococcus pneumoniae blood and pulmonary isolates from U.S. sites, resistance to macrolide class antibiotics was observed in 47.3% of Streptococcus pneumoniae colonies obtained from respiratory cultures, and 29.6% from blood cultures. As resistance to macrolide class antibiotics in respiratory isolates was greater than 25% in all regions of the U.S, we believe clinicians should consider alternatives to macrolide monotherapy for community acquired pneumonia in the U.S. based on current treatment guidelines.

 In addition, the CDC recently reported on the growing evidence of widespread resistance to macrolides, widely usedmacrolide class antibiotics, thatwhich are designed to disrupt bacterial protein synthesis, inMycoplasma pneumoniae, a common cause of CABP that is associated with significant morbidity and mortality. Furthermore,Staphylococcus aureus, including methicillin-resistantS.Staphylococcus aureus, or MRSA, which has also been designated as a serious threat to human health by the CDC,

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has emerged as a more common cause of CABP in some regions of the world, and a possible pathogen to be covered with empiric therapy.

As a result of increasing resistance to antibiotics and the wide array of potential pathogens that cause CABP, the current standard of care for hospitalized patients with CABP whose treatment is initiated in the hospital usually involves first-line empiric treatment with a combination of antibiotics (cephalosporins and macrolides) to address all likely bacterial pathogens or monotherapy with a respiratory fluoroquinolone. In patients where MRSA is suspected, fluoroquinolones are also typically administered in combination with other antibiotics. Combination therapy presents the logistical challenge of administering multiple drugs with different dosing regimens, with some drugs available only asthrough IV and increasesadministration, which may increase the risk of drug-drug interactions and the potential for serious side effects. Fluoroquinolones are associated with safety and tolerability concerns, including a relatively high risk for developingClostridium difficile infection and because of their generally broad spectrum of activity, increasing rates of resistance for uropathogens. We believe these concerns have resulted in a decreasing use of fluoroquinolones and restriction of their use within a growing number of hospitals.

The FDA has communicated safety information about fluoroquinolones, advising that when used systemically, in the form of tablets, capsules andor injectable preparations, fluoroquinolones are associated with disabling and potentially permanent serious side effects. In December 2018, the FDA warned prescribers of an increase in the occurrence of rare but serious events of ruptures or tears in the main artery of the body, called the aorta. These tears, called aortic dissections, or ruptures of an aortic aneurysm can lead to dangerous bleeding or even death. Prior communications pertaining to the safety of fluoroquinolones occurred in July 2018 (significant decreases in blood sugar and certain mental health side effects), July 2016 (disabling side effects of the tendons, muscles, joints, nerves, and central nervous system), May 2016 (restricting use for certain uncomplicated infections), August 2013 (peripheral neuropathy), and July 2008 (tendinitis and tendon rupture). The European Medicines Agency, or EMA, has also reviewed this class of antibiotics and havehas modified prescribing information restrictingto restrict use, as well as outliningand outline some of the safety risks. We believe these concerns have contributed to the increase in restrictions imposed by hospitals on and overall decline in the use of fluoroquinolones.

        Fluoroquinolones are typically administered in combination with other antibiotics, if community-acquired MRSA is suspected. In addition, manyMany currently available antibiotic therapies are only available for IV administration and are prescribed for seven to fourteen days, meaning continued treatment requiresrequiring prolonged hospitalization or a switch to a different antibioticorally administered orally,antibiotic, with the attendant risk that the patient might respond differently.

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Effective January 1, 2017, the Joint Commission & Center for Medicare and Medicaid Services, or CMS, began requiring all U.S. hospitals to have Antibiotic Managementantibiotic management guidelines, also known as "Stewardship" Committees,“stewardship” committees, in place to identify antibiotics most appropriate and targeted to each individual patient'spatient’s infection. Past efforts to "cast“cast the widest net possible"possible” with broad-spectrum antibiotics that affect many types of bacteria have caused problems, such asC.Clostridium difficile infections, by killing good bacteria or increased antibiotic resistance in other bacteria in different areas of the body. Additionally, in 2016, the Infectious Diseases Society of America and the Society for Healthcare Epidemiology of America, or IDSA/SHEA, updated their Antibiotic Stewardshipantibiotic stewardship guidelines for antibiotic use. We believe that three key goals from these guidelines are applicable to the treatment of CABP:

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Reduce the risk of antibiotics associated with a high risk ofC. difficile infections;



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Increase use of oral antibiotics as a strategy to improve outcomes or decrease costs; and



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Reduce antibiotic therapy to the shortest effective duration.

Consistent with the Antimicrobial Stewardship principles, we believe that lefamulinXENLETA could be well suited as either a first-line or second-line empiric monotherapy for the treatment of CABP patients in the hospital setting, outpatient-transition of care setting or in the community setting, because of its novel mechanism of action, complete spectrum of activity for CABP pathogens, including against multidrug

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resistant strains, achievement of substantial drug concentrations in lung fluids and lung immune cells, andthe flexibility asto step down from IV to oral agent with both the IVadministration and oral formulations anda favorable safety and tolerability profile.

On September 9, 2019, we announced that the oral and IV formulations of XENLETA were available in the United States for the treatment of CABP in adults through major specialty distributors. This followed the approval by the FDA of our NDA for XENLETA on August 19, 2019 for the treatment of adults with CABP. XENLETA is the first oral and IV treatment in the pleuromutilin class of antibiotics available for the systematic administration in humans.

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We primarily market XENLETA to community-based physicians. This strategy has been implemented given XENLETA’s convenient 5-day dosing of its oral formulation and given that it is widely covered under most commercial insurance plans.

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We entered into a license and commercialization agreement in March 2019 with Sunovion Pharmaceuticals Canada Inc., or Sunovian, for the commercial rights to XENLETA in Canada. On July 16, 2020, we announced that Sunovian received approval from Health Canada to market oral and IV formulations of XENLETA® (lefamulin) for the treatment of community-acquired pneumonia, or CAP, in adults, with the related Notice of Compliance from Health Canada dated July 10, 2020.

On July 28, 2020, we announced that the European Commission, or EC, issued a legally binding decision for approval of the marketing authorization application for XENLETA™ (lefamulin) for the treatment of CAP, in adults when it is considered inappropriate to use antibacterial agents that are commonly recommended for initial treatment or when these agents have failed following a review by the EMA. The EC approved XENLETA for countries of the European Economic Area, or EEA, and United Kingdom, or U.K. We intend to work with a commercial partner to make XENLETA available to patients in the EEA and U.K.

In May 2021, Sumitomo Pharmaceuticals (Suzhou) and we announced positive topline results from Sumitomo Pharmaceuticals (Suzhou)’s Phase 3 clinical trial of lefamulin in Chinese adults with CABP. Sumitomo Pharmaceuticals (Suzhou)’s multi-center, randomized, double-blind trial was designed to evaluate the safety and efficacy of IV to oral lefamulin compared to IV/oral moxifloxacin in 125 patients with CABP. The results were similar to those observed in our global Phase 3 LEAP 1 and LEAP 2 clinical trials of lefamulin conducted. Consistent with previously reported clinical trial results, lefamulin was observed to be generally well-tolerated, with an overall rate of treatment-emergent adverse events, or TEAEs, comparable to that of moxifloxacin. The vast majority of TEAEs in both treatment arms were mild-to-moderate in severity, with serious adverse events occurring in 4% of lefamulin-treated patients and 10% of moxifloxacin-treated patients. TEAEs leading to discontinuation were uncommon and observed in just 5% of subjects in both treatment arms.

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In September 2021, Sumitomo Pharmaceuticals (Suzhou) and we announced Sumitomo Pharmaceuticals (Suzhou) received approval to market oral and IV formulations of XENLETA for the treatment of community-acquired pneumonia in adults in Taiwan.

In November 2021, we announced that Sumitomo Pharmaceuticals´ (Suzhou) NDA to market oral and IV formulations of lefamulin for the treatment of community-acquired pneumonia, or CAP, in adults in mainland China was accepted for review by the Chinese Center for Drug Evaluation, or CDE, China’s regulatory authority, on November 23, 2021. The expected time for the application review is up to 24 months.

COVID-19 has demonstrated the devastating impact that infectious diseases can have on public health and the economy. Similar to other acute respiratory virus infections, including influenza virus, patients infected with COVID-19 are at increased risk of developing concomitant bacterial pneumonia. In published reports, bacterial pneumonia has been shown to affect nearly 50% of hospitalized patients with COVID-19, with an associated mortality of almost 50%. Some physisians routinely administer broad-spectrum antibiotics as an empiric therapy for bacterial pneumonia to all patients with COVID-19 and moderate or severe hypoxemia. Other physisians administer antibiotics only for certain situations, such as the presence of a lobar infiltrate on a chest X-ray, leukocytosis, an elevated serum lactate level, microbiologic data, or shock. If antimicrobials are initiated, the NIH Panel recommends that their use should be reassessed daily to minimize the adverse consequences of unnecessary antimicrobial therapy. In addition to XENLETA’s potential role in treating COVID-19 patients with superimposed bacterial pneumonia, we are assessing the anti-inflammatory activity of XENLETA and what role, if any, these characteristics may play in the management of patients with COVID-19.

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CONTEPO

On July 24, 2018, we completed the acquisition of Zavante Therapeutics, Inc., or Zavante, a privately-held late clinical-stage biopharmaceutical company focused on developing novel therapies to improve the outcomes of hospitalized patients. Zavante'stogether with its lead product candidate is CONTEPO™ (fosfomycin for injection, previously referred to as ZTI-01 and ZOLYD)., or the Acquisition. With the Acquisition, Zavante became our wholly owned subsidiary.

        We submitted an NDA for marketing approval of CONTEPO for the treatment of cUTI including AP in adults in the United States, to the FDA in October 2018. The NDA submission is utilizing the 505(b)(2) regulatory pathway and is supported by a robust data package, including a pivotal Phase 2/3 clinical trial (known as ZEUS™), which met its primary endpoint of statistical non-inferiority to piperacillin/tazobactam in patients with cUTI, including AP. The FDA has granted us a Prescription Drug User Fee Act, or PDUFA target action date of April 30, 2019 for CONTEPO.

The prevalence of antibiotic-resistant bacteria is increasing and is considered a significant threat to global health. In particular, the CDC and the WHO consider antibiotic resistance to be an urgent and critical threat to human health. The prevalence of lactamase enzymes among Gram-negative pathogens threatens the usefulness of many beta -lactam antibiotics and has resulted in greater reliance on last line antibiotics, including carbapenems. Complicated urinary tract infections, or cUTIs, including acute pyelonephritis, or AP, are among the most common infections due to multi-drug resistant, or MDR bacteria, including carbapenem-resistant Enterobacteriaceae, or CRE, and are often healthcare-associated. Global mortality attributable to CRE infections has been estimated in some studies to be over 20% and reflects the need for safe, alternative, carbapenem-sparing options.

CONTEPO is a novel, potentially first-in-class investigational IV antibiotic in the United States with a broad spectrum of Gram-negative and Gram-positive activity, including activity against most MDR strains such as extended-spectrum beta-lactamase-β-lactamase-, or ESBL-producing Enterobacteriaceae. Intravenous fosfomycin has been approved for a number of indications and utilized for over 45 years in Europe to treat a variety of serious bacterial infections, including cUTIs. CONTEPO utilizes a new dosing regimen that optimizes its pharmacokinetics and pharmacodynamics. We believe these attributes, the extensive worldwide clinical experience worldwide and the positive efficacy and safety results from the Phase 2/3 clinical trial support CONTEPO as a first-line treatment for cUTIs, including AP, suspected to be caused by MDR pathogens. At least 20% of cUTIs are caused by MDR bacteria and limited treatment options are available in the U.S. In addition, non-clinical data have shown that CONTEPO acts in combination with certain other antibiotics to improve bacterial killing.

We submitted an NDA for marketing approval of CONTEPO for the treatment of cUTI including AP in adults in the United States, to the FDA in October 2018. The NDA submission is utilizing the 505(b)(2) regulatory pathway and is supported by a robust data package, including a pivotal Phase 2/3 clinical trial (known as ZEUS™), which met its primary endpoint of statistical non-inferiority to high dose piperacillin/tazobactam in patients with cUTI, including AP. In April 2019, the FDA issued a CRL in connection with our NDA for CONTEPO for the treatment of cUTIs, including AP, stating that it was unable to approve the application in its current form. The CRL requested that issues related to facility inspections and manufacturing deficiencies at our active pharmaceutical ingredient contract manufacturer be addressed prior to the FDA approving the NDA. We requested a “Type A” meeting with the FDA to discuss its findings and this meeting occurred in July 2019. As the FDA did not request any new clinical data and did not raise any other concerns with regard to the safety or efficacy of CONTEPO in the CRL, the purpose of the meeting was to discuss and

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gain clarity on the issues related to facility inspections and manufacturing deficiencies at one of our contract manufacturers that were described in the CRL and other matters pertaining to the steps required for the resubmission of the NDA for CONTEPO. We resubmitted our NDA in December 2019 and the FDA acknowledged the resubmission in January 2020. On June 19, 2020 we received a second CRL from the FDA. Although our European contract manufacturing partners were prepared for regulatory authority inspections, the CRL cites observations at our manufacturing partners that could not be resolved due to FDA’s inability to conduct onsite inspections because of travel restrictions. On October 30, 2020, we participated in a “Type A” meeting with the FDA to obtain any new information related to the FDA´s pending conduct of inspections of foreign manufacturers during the COVID-19 pandemic that has negatively impacted a number of FDA product reviews, including our NDA for CONTEPO. On April 14, 2021, the FDA issued industry guidance on remote interactive evaluations of drug manufacturing and bioresearch monitoring facilities during the COVID-19 pandemic specifying that when it cannot perform a Pre-Approval Inspection, or PAI, or a Pre-License Inspection, or PLI, or when the FDA determines that it would be useful to supplement a planned inspection, the agency will consider using tools other than a physical inspection and select the most appropriate method to address the specific risks that justify the need for the PAI or PLI. The FDA informed us that onsite inspections of our manufacturing partners in Europe are required in order for the FDA to complete the review of a potential CONTEPO NDA resubmission. Due to travel restriction related to the COVID-19 pandemic, the FDA suspended onsite inspections of ex-US manufacturers for all non-COVID products. As a result, we requested an extension of the timeline for a potential CONTEPO NDA resubmission until June 2023, which the FDA granted on March 21, 2022. We are awaiting further clarity from the FDA regarding their ability to complete onsite inspections at our manufacturing partners in Italy and Spain before determining specific timing of the potential NDA resubmission, which we plan to submit promptly once we have clarity from the FDA. We currently do not have a forecasted date for the resubmission of our NDA for CONTEPO, for the treatment of cUTI, including AP. The FDA released the Resiliency Roadmap for FDA Inspectional Oversight that describes the systematic approach that FDA will utilize to manage postponed inspections and other oversight activities. The prioritization plan considers public health risks related to conducting an inspection, such as the impact of the product’s availability on public health, as well as investigator safety and travel restrictions/advisories. In addition, the FDA informed us that, while they cannot predict when an inspection may occur and when the pandemic may prevent the FDA from completing inspections, tier 1 mission-critical inspections and tier 2 higher priority inspections, which includes PAIs, will continue to be prioritized going forward. We cannot predict the outcome of any further interactions with the FDA or when CONTEPO will receive marketing approval, if at all.

Our Strategy

        Our goal is to becomeWe are a biopharmaceutical company focused onengaged in the commercialization and research and development of novel anti-infective products.agents to treat serious infections. The key elements of our strategy to achieve this goal are:

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Maximize the commercial potential of CONTEPO for cUTI's and lefamulin for CABP.  We own exclusive, worldwide rights to lefamulin and US rights to CONTEPO and we have out licensed the rights to lefamulin in China. We expect that our initial target patient population for lefamulin will consist of patients with moderate to severe CABP and the initial target population for CONTEPO will be hospitalized patients with complicated urinary tract infections. If either or both CONTEPO or lefamulin receives marketing approval from the FDA, we plan to commercialize them in the United States with our own targeted sales and marketing organization that we plan to expand beyond its current levels. We believe both CONTEPO and lefamulin have innovative profiles which, if approved, would support their adoption in the

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United States for adult cUTI patients treaded in the hospital and CABP patients, respectively, treated as in-patients in a hospital setting. Lefamulin

Table of care from the hospital, which we believe represents a significant commercial opportunity. We believe that we will be able to effectively communicate CONTEPO's and lefamulin's differentiating characteristics and key attributes to clinicians, hospital pharmacies and payors with the goal of establishing favorable reimbursement as well as a favorable formulary status in targeted hospitals. Outside the United States we expect to utilize a variety of types of collaboration, distribution and other marketing arrangements with one or more third parties to commercialize lefamulin in such markets. We currently have a team of regional business directors and medical science liaisons in the field performing educational and market development activities, respectively. We initially plan to use a targeted hospital-based sales force to promote both lefamulin formulations and CONTEPO, if approved.Contents

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Pursue the continued development of lefamulin in additional indications.  We are evaluating the cost and benefits of the continued development of lefamulin for indications in addition to CABP. Pediatric oral formulation development is ongoing, and we initiated a Phase 1 clinical trial in pediatric patients in mid-2018. We believe lefamulin has potential to treat acute bacterial skin and skin structure infection (ABSSSI), ventilator-associated bacterial pneumonia (VABP) or hospital-acquired bacterial pneumonia (HABP) and sexually transmitted infections (STIs). In addition, we may explore longer duration of treatment with lefamulin to support development of a treatment for osteomyelitis and prosthetic joint infections. We believe that lefamulin would be differentiated from other treatment options for these potential indications because of its novel mechanism of action, spectrum of activity, including activity against multi-drug resistant pathogens, achievement of substantial concentrations in relevant tissues, availability as both an IV and oral formulation and favorable safety and tolerability profile.

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Pursue the development of CONTEPO for a pediatric indication.  We are evaluating the continued development of CONTEPO for use in pediatric patients with cUTIs. In June 2018, we initiated a Phase 1, non-comparative, open-label study of the pharmacokinetics and safety of a single dose of CONTEPO in pediatric subjects less than 12 years of age.

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Evaluate business development opportunities and potential collaborations.  We may expand our product pipeline through opportunistically in-licensing or acquiring the rights to complementary products, product candidates and technologies for the treatment of a range of infectious diseases or other hospital-based products that could utilize our planned commercial infrastructure. We plan to evaluate the merits of entering into collaboration agreements with other pharmaceutical or biotechnology companies that may contribute to our ability to efficiently advance our product candidates, build our product pipeline, concurrently advance a range of research and development programs and leverage our commercial infrastructure. Potential collaborations may provide us with funding and access to the scientific, development, regulatory and commercial capabilities of the collaborators. We also plan to encourage local and international government entities and non-government organizations to provide additional funding and support for our development programs.

Background

Anti-Bacterial Market and Scientific Overview

        Bacteria are broadly classified as Gram-positive or Gram-negative. Gram-positive bacteria possess a single membrane and a thick cell wall and turn dark-blue or violet when subjected to a laboratory staining method known as Gram's method. Gram-negative bacteria have a thin cell wall layered between an inner cytoplasmic cell membrane and a bacterial outer membrane and, as a result, do not retain the violet stain used in Gram's method. Antibiotics that are active against both Gram-positive

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and Gram-negative bacteria are referred to as broad spectrum, while those that are active only against a select subset of Gram-positive or Gram-negative bacteria are referred to as narrow spectrum. Bacteria that cause infections are often referred to as bacterial pathogens. Because it often takes from 24 to 4872 hours to definitively diagnoseidentify the particular bacterial pathogen causing an infection, and the difficulty associated with obtaining adequate bacterial cultures in some patients and infections, the causative pathogenpathogen(s) often remains unidentified and narrow spectrum antibiotics are not generally used as empiric monotherapy for first-line treatment of hospitalized patients with serious infections.

unidentified. Since the introduction of antibiotics in the 1940s, numerous new antibiotic classes have been discovered and developed for therapeutic use. The development of new antibiotic classes and new antibiotics within a class is important because of the ability of bacteria to develop resistance to existing mechanisms of action of currently approved antibiotics. However, the pace of discovery and development of new antibiotic classes slowed considerably in the past few decades. The CDC estimates that the pathogens responsible for more than 70% of U.S. hospital infections are resistant to at least one of the antibiotics most commonly used to treat them. The CDC also estimated in 2013, based on data collected from evaluations performed between 2006 and 2011,2019 that annually in the United States at least two2.8 million people become infected with bacteria that are resistant to antibiotics and at least 23,00035,000 people die as a direct result of these infections.

Antibiotic resistance is primarily caused by genetic mutations in bacteria selected by exposure to antibiotics that do not kill all of the bacteria. In addition to mutated bacteria being resistant to the drug used for treatment, many bacterial strains can also become cross-resistant, meaning that they become resistant to multiple classes of antibiotics. As a result, the effectiveness of many antibiotics has declined, limiting physicians'physicians’ options to treat serious infections and exacerbating a global health issue. For example, the WHO estimated in 2014 that people with infections caused by MRSA, a highly resistant form of bacteria, are 64% more likely to die than people with a non-resistant form of the infection.bacteria. Resistance can increase the cost of healthcare because of the potential for lengthier hospital stays and more intensive care. Growing antibiotic resistance globally, together with the low level of investment in research and development, is considered one of the biggest global health threats. In 2010, the WHO stated that antibiotic resistance is one of the three greatest threats to human health. Partially in response to this threat, the U.S. Congress passed the GAIN Act in 2012, which provides incentives, including access to expedited FDA review for approval, fast track designation and five years of potential data exclusivity extension for the development of new QIDPs. Additional legislation is also being considered in the United States, including the Antibiotic Development to Advance Patient Treatment Act of 2013, which is intended to accelerate the development of anti-infective products, and the Developing an Innovative Strategy for Antimicrobial Resistant Microorganisms Act of 2014,2019, or DISARM, which is intended to establish a new reimbursement framework to enable premium pricingproduct specific reimbursement to hospitals for anti-infective products. In addition, the CMS has launched an alternative New Technology Add-On Payment, or NTAP, to increase access to innovative antibiotics for hospital inpatients, by improving reimbursement rates for new generation anti-infectives, and specifically those considered QIDP. In September 2020, the Centers for Medicare & Medicaid Services, or CMS, granted a NTAP for XENLETA for injection, when administered in the hospital inpatient setting. Both the IV and oral formulations of anti-infective products.XENLETA were granted QIDP and Fast Track designation by the FDA. NTAP was also grated for CONTEPO, making it the first QIDP antibiotic to be granted conditional NTAP approval prior to receiving FDA approval. CONTEPO was granted QIDP and Fast Track Designation by the FDA for the treatment of complicated urinary tract infections, or cUTIs, including acute pyelonephritis.

In 2017,2018, sales of antibiotics to treat humans totaled approximately $42$45 billion globally. Although judicious use of antibiotics is important to reduce the rate of antibiotic resistance, this approach alone cannot fully address the threat from increasing antibiotic resistance. New antibiotics, and particularly new antibiotic classes, are needed to ensure the availability of effective antibiotic therapy in the future.

Community-AcquiredAcute Bacterial Pneumonia (CABP)Skin and Skin-Structure Infections

Market Overview

        The U.S. National Center for Health Statistics estimated that between 1988ABSSSIs are very common and 1994 there were approximately 5.6are characterized by a wide range of disease presentations. Over 10.7 million cases of pneumonia per year in the United States. More recently,unique patients are diagnosed annually with ABSSSIs and lead to over 850,000 hospitalizations based on our combined analysismarket research. The vast majority of ABSSSI patients are successfully treated in the community setting with oral medications.

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The frequency of ABSSSI is increasing. From 2000 to 2004, total hospital admissions attributed to ABSSSIs increased by 30%, followed by another 17% increase from 2005 to 2011. During a similar time period, from 1993 to 2005, the number of emergency department visits attributed to ABSSSIs almost tripled, from 1.2 million to 3.4 million patients. The increase in frequency of ABSSSI is attributed to the spread of resistant bacteria, in particular, community-associated methicillin-resistant Staphylococcus aureus, or CA-MRSA. ABSSSI includes infections of deeper soft tissues, cellulitis, wound infections, burns, and major abscesses. They often lead to substantial morbidity and mortality, can be resource intensive and incur high healthcare costs.

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Causes of ABSSSIs

ABSSSIs are a frequent reason for seeking care at in both the outpatient and hospital settings. Staphylococcus aureus is one of the CDC's 2007 National Ambulatory Medical Care Survey,most common pathogens associated with these infections, and the National Hospital Ambulatory Medical Care Surveyemergence of community-associated MRSA, has represented a significant challenge in their treatment.

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Gram-positive bacteria, in particular Staphylococcus aureus, Staphylococcus pyogenes, and 2013 dataother ß-hemolytic streptococci are the most common pathogens in ABSSSI. Of increasing concern is the rapidly rising frequency of ABSSSI caused by MRSA. There has been a dramatic increase in the occurrence of CA-MRSA infections since 2000. In many U.S. cities CA-MRSA is the most common pathogen cultured from patients with skin and skin structure infections in emergency departments. The emerging incidence of resistance to multiple antibiotics in pathogens makes ABSSSI increasingly difficult to treat. The most recent practice guidelines published by the Healthcare CostIDSA for the treatment of ABSSSIs reflect the impact of MRSA, because a large focus is on antibiotic regimens covering Staphylococcus aureus, in particular, MRSA. The introduction of community-associated MRSA organisms has also influenced the selection of empirical antibiotic therapy to treat ABSSSIs. Additionally, knowledge of regional microbial resistance and Utilization Project we estimatesusceptibility patterns is essential to identify appropriate empirical coverage for MRSA. Therefore, empiric coverage for MRSA has been recommended for treatment of skin and soft tissue infections, given the high community prevalence of MRSA. Empiric antibiotic therapy with activity against MRSA is particularly important in the following circumstances:

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It is recommended that over 5.0 million adults areABSSSI patients with mild infection (localized involvement with no systemic symptoms), due to known or suspected MRSA, may be treated annually for CABPwith oral antibiotic therapy. However, treatment with IV formulations of antibiotic therapy may be appropriate in the following circumstances:

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About MRSA

According to the CDC, “Antibiotic resistance threats in the United States, 2019” report, in contrast to the 2013 report, while the burden of antibiotic-resistance threats in the U.S. was greater than initially estimated, deaths are decreasing. However, the number of Americans who must deal with antibiotic resistant infections remains high. According to the CDC, more than 2.8 million antibiotic-resistant infections occur in the U.S. yearly and lead to the deaths of 35,000 Americans.

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One of the serious public health threats identified by the CDC is MRSA, which continues to be a clinical and economic burden. Based on the CDC 2019 report, there were 323,700 estimated MRSA cases in hospitalized patients in 2017, and an estimated 10,600 deaths in the U.S due to MRSA. The European Centre for Disease Prevention and Control, or ECDC, estimates that more than four million patients in the European Union, or EU, healthcare acquired infections annually, resulting in 37,000 deaths and that a large proportion of these deaths are due to the most common multidrug-resistant bacteria, including MRSA. According to the ECDC, MRSA is still the most commonly identified antimicrobial-resistant pathogen in hospitals in many parts of the world, including Europe, the Americas, North Africa, the Middle East, and Asia. Data from the Eurosurveillance journal estimates MRSA infections affect more than 150,000 patients annually in the EU.

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Currently Available Treatment Options

Since it may take as long as 48 to 72 hours to identify the pathogen(s) causing an infection and most of the currently available oral therapy options that cover resistant pathogens are narrow-spectrum treatments, physicians frequently prescribe two or more antibiotics to treat a broad-spectrum of potential pathogens. In general, empiric therapy choice has typically been guided by the patients’ clinical circumstances including regional antibiotic resistance patterns, allergy history, and concomitant medications. A recent 12 month analysis of oral treatment options in the outpatient setting by IQVIA indicated cephalosporins (Keflex), sulfonamide/trimethoprim combinations (Bactrim), tetracyclines and fluroquinolones (Baxdela), are some of the most frequently prescribed oral treatments for certain serious bacterial skin infections. However, these commonly prescribed therapies must be dosed more frequently, and many have adverse drug effects such as drug-drug interactions and central nervous system effects. The efficacy of tetracyclines is supported by susceptibility testing and observational and retrospective reports; however their efficacy for treatment of skin and soft tissue infections due to MRSA has not been rigorously evaluated or compared in clinical trials. Fluroquinolones are not recommended as a treatment option for ABSSSIs caused by MRSA because of decreased susceptibility of MRSA to fluoroquinolones, which also highlights the need for additional treatment options for skin infections that are caused by fluoroquinolone-resistant organisms.

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Limitations of Currently Available Treatment Options

The most common treatments for serious bacterial skin infections are beta-lactams, such as cephalosporins (cephalexin (Keflex), cefazolin (Anef)) or penicillin, or its derivates such as dicloxacillin, nafcillin or oxacillin. Other agents include, sulfonamide/trimethoprim combinations (Bactrim), tetracyclines, vancomycin, linezolid and fluroquinolone (Baxdela). Although many of these agents have an effective oral equivalent of dicloxacilin, some such as vancomycin or daptomycin (Cubicin) for MRSA infections do not; the lack of an effective bioequivalent oral formulation of these and many other commonly prescribed antibiotics requires continued IV therapy, which is inconvenient for the patient and may result in longer hospital stays and greater cost. Alternatively, because of the absence of the same antibiotic in an oral, well-tolerated formulation, physicians may switch the patient to a different orally available antibiotic at the time of hospital discharge. This carries the risk of new side effects and possible treatment failure if the oral antibiotic does not cover the same bacteria that were being effectively treated by the IV antibiotic therapy. While linezolid is a twice-daily IV and oral therapy, it is a narrow-spectrum treatment that is associated with increasing bacterial resistance, side effects from interactions with other therapies and other serious safety concerns.

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Adverse Effects

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Concerns about antibiotic safety and tolerability are among the leading reasons why patients stop treatment and fail therapy. The most commonly used antibiotics to treat ABSSSIs, such as cephalosporins (Keflex), sulfonamide/trimethoprim combinations (Bactrim), and fluroquinolones (Baxdela) are associated with safety and tolerability concerns. For example, Bactrim is associated with severe reactions including Stevens-Johnsons syndrome a rare and serious disorder of the skin and mucus membranes. As previously noted, fluoroquinolones are associated with tendon rupture, peripheral neuropathy and, more recently, valvular abnormalities, aortic aneurysm and/or dissection. In addition, fluoroquinolones have been associated with an increased frequency of Clostridium difficile colitis, an overgrowth of a bacteria in the colon that produces a toxin that results in inflammation of the colon and repeated bouts of watery diarrhea. Linezolid should not be taken by patients who are also on many commonly prescribed anti-depressants, such as monoamine oxidase inhibitors and serotonin reuptake inhibitors.

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Our Solution : SIVEXTRO for the treatment of ABSSSI

SIVEXTRO (tedizolid phosphate) is a novel oxazolidinone class antibiotic to treat susceptible Gram-positive pathogens including MRSA, one of the serious public health threats identified by the CDC.

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SIVEXTRO, available in both IV and oral formulations, was approved by the FDA in 2014 for the treatment of adults with ABSSSI such as cellulitis, wound infections and erysipelas and in 2020 the label was expanded to include adolescents 12 years of age and older.

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Administered once-daily, SIVEXTRO offers an effective, short six-day course of therapy. Convenient dosing enables greater patient compliance and is one of the key therapeutic and commercial benefits of the drug over existing treatments, many of which must be taken more frequently and for longer periods of time. SIVEXTRO has proven efficacy and demonstrated 80% early clinical response in 48-72 hours, so clinicians can have confidence that the drug will work quickly and is well tolerated with a low incidence of side effects. There is no need for monitoring and no drug-drug interactions with selective serotonin reuptake inhibitors, or SSRIs, another significant competitive advantage, and SIVEXTRO is not a substrate for hepatic CYP450. Additionally, many older ABSSSI treatments can only be administered intravenously, and therefore require hospital treatment leading to increased healthcare costs.

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Community-Acquired Bacterial Pneumonia

Market Overview

Our analysis of the LexisNexis data indicates that approximately 2.4 million of adult CABP patients were treated as inpatients with IV or injectable antibiotics, and we found that the majority of theseCABP patients enter the hospital inpatient setting following the initiation of antibiotic therapy during an Emergency Department, or ED, visit. Additionally, our analyses show that approximately 1.4 million adult CABP patients have their treatment initiated in a hospital, including

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emergency departments. According to the Healthcare Cost and Utilization Project,were treated with antibiotic courses, IV or HCUP, in 2013, approximately 3.1 million adults sought treatment in a U.S. hospital for CABP. In addition, in 2013, approximately 2.4 million adults were admitted to U.S. hospitals for in-patient care with a diagnosis of CABP and approximately 700,000 adults were seen in an emergency department at U.S. hospitals for treatment of CABP and then released.

        Additionally, in 2014, based on CDC data approximately 50,000 patients died from CABPoral, in the United States. ED or as hospital outpatients and subsequently released without hospital admission.

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Based on data collected from July 1, 20122015 through June 30, 2015,2018, on the Medicare.gov Hospital Compare website, the current national rate of readmissions for Medicare pneumonia patients is 17.1%16.6%, which is the percentage of patients who have had a recent hospital stay that must return to a hospital for unplanned care within 30 days of being discharged. The national average death rate for Medicare pneumonia patients, excluding Medicare Advantage plan data, is 16.3%15.6%, which is the percentage of patients who die, for any reason, within 30 days of admission to a hospital.

Based on data from LexisNexis®LexisNexis Risk Solutions, a leading provider of healthcare data and analytics solutions, as well as analysis of data from US hospitals and other healthcare facilities, we determinedbelieve that the number of adult CABP patients who were treated with antibiotic therapy in hospitals in the United States exceeded 3.8 million for full-year 2016. Our analysis of the LexisNexis data also indicates that approximately 2.4 million of these adult CABP patients were treated as inpatients with IV/injectable antibiotics, and we find that the majority of CABP patients enter the hospital inpatient setting following the initiation of antibiotic therapy during an Emergency Department (ED)ED visit. Additionally, our analyses show that approximately 1.4 million adult CABP patients were treated with antibiotic courses (IV or oral) in the ED or as hospital outpatients and subsequently released without hospital admission.

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Additionally, approximately 1.4 million adult CABP patients were treated with antibiotic courses (IV or oral) in the ED or as hospital outpatients and subsequently released without hospital admission. Furthermore, as a result of our market research in 2017-18, we believe that once adult CABP patients are released from ED stays or are discharged from U.S. hospitals, approximately 60-70%, receive oral antibiotic oral outpatient prescriptions as continuation of their antibiotic treatment. As hospitals look to minimize the total cost of care and duration of hospital stay for CABP patients toward improved outcomes, efficient transition of adult CABP inpatients to an oral antibiotic treatment as outpatient therapy can significantly reduce days of hospitalization and overall treatment cost.

        IQIVAIQVIA estimated that in 2017 approximately 22.0 million adult CABP patients were actively treated with antibiotics from prescribers in community clinics e.g. primary care offices and at other non-hospital based sites of urgent care. As a result, we believe that approximately 6 million CABP patients are treated with antibiotics in the United States on an annual basis and 6 out of every 10 adult CABP patients have treatment initiated in a hospital setting versus. the community setting.

Overall, the impact of pneumonia is serious. Based on CDC data, approximately 50,000 patients died from CABP in the United States in 2014.

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Causes of CABP

Pneumonia can be caused by a variety of micro-organisms, with bacteria being the most common identifiable cause. CABP refers to bacterial pneumonia that is acquired outside of a hospital setting. Signs and symptoms of CABP include cough, fever, sputum production and chest pain. A number of different types of bacteria can cause CABP, including both Gram-positive and Gram-negative bacteria. Pneumonia that is caused by atypical bacterial pathogens often has different symptoms and responds to different antibiotics than pneumonia caused by pathogens referred to as typical bacteria. However, atypical bacteria are not uncommon. The most common bacterial pathogens noted in current treatment guidelines from the Infectious Diseases Society of America, or IDSA, for hospitalized CABP patients who are not in the intensive care unit areStreptococcus pneumoniae, Mycoplasma pneumoniae, Haemophilus influenzae, Chlamydophila pneumoniae, andLegionella species. In addition, IDSA notes the emergence of resistance to commonly utilized antibiotics for CABP, specifically drug-resistant

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S. Streptococcuspneumoniae and community-acquired MRSA, or CA-MRSA, as a major consideration in choosing empiric therapy. However, a majority of patients do not have a pathogen identified using routine diagnostic tests available to physicians.

Currently Available Treatment Options

In 2007,2019, based on the most likely bacteria to cause CABP, IDSA and the American Thoracic Society, or ATS, recommendupdated their recommendations for the empiric treatment of non-severe hospitalized patients with CABP who do not require treatment in an intensive care unit without risk factors for MRSA and Pseudomonas aeruginosawith either:

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a combination of a cephalosporin plus a macrolide or

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monotherapy with a respiratory fluoroquinolone; or

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combination therapy with a β-lactam and doxycyclinewhen macrolides or fluoroquinolones are contraindicated.

Given concerns over increasing drug resistance (macrolides) and safety issues (macrolides, fluoroquinolones), the guidelines noted a combinationneed for additional research of new therapeutic agents, like XENLETA, for adults with CABP. As a cephalosporin, an antibioticnew therapeutic agent for the treatment of CABP, we believe the treatment of CABP with XENLETA is consistent with the guidelines.

Regarding outpatient therapy, the updated guidelines now only conditionally recommend macrolide monotherapy for CABP patients with or without comorbidities or risk factors only if local pneumococcal macrolide resistance is less than 25% and reiterated that disrupts the cell wall of bacteria, plus a macrolide, an antibiotic that disrupts bacterial protein synthesis; or



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monotherapy with a respiratory fluoroquinolone, an antibiotic that disrupts bacterial protein synthesis.

        In the event CA-MRSA is suspected, these guidelines recommend that vancomycin, an antibiotic that disrupts the cell wall of bacteria, or linezolid, an antibiotic that disrupts bacterial protein synthesis, be used or added to the current regimen.

        In addition, physicians need to be aware of the local susceptibility profiles of the common bacterial pathogens associated with CABP because of increasing resistance to first-line antibiotics. For example, rates of pneumococcal resistance to macrolides now exceed 25% in most areas of the US and resistance to

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tetracyclines (another first line outpatient recommended first-line macrolidestherapy) exceed 40%25% in some areas, while resistance inM.Mycoplasma pneumoniae associated with severe disease has been recently reported by the CDC in the United States. Antibiotic resistance is widespread to various degrees throughout the world.

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Limitations of Currently Available Treatment Options

When confronted with a new patient suffering from a serious infection caused by an unknown pathogen, a physician may be required to quickly initiate first-line empiric antibiotic treatment, often with a combination of antibiotics, to stabilize the patient prior to definitively diagnosing the particular bacterial infection. However, currently available antibiotic therapies for first-line empiric treatment of CABP suffer from significant limitations.

Bacterial Resistance and Spectrum of Activity

As a result of bacterial resistance, the effectiveness of many antibiotics has declined. For example, the CDC estimates that in 30% of severeS. Streptococcuspneumoniae cases, the bacterial pathogen is fully resistant to one or more clinically relevant antibiotics, with 44% of strains resistant to a macrolide in the United States. In addition, fluoroquinolone resistance inS. pneumoniae has increased from less than 0.5% to more than 3% of cases in some regions of North America, which parallels increased total fluoroquinolone prescriptions. Antibiotic resistance has a significant impact on mortality and contributes heavily to healthcare system costs worldwide. According to the CDC, cases of resistant pneumococcalPneumococcal pneumonia result in 32,000 additional doctor visits, approximately 19,000 additional hospitalizations and 7,000 deaths each year. None of the currently available treatment options provides a monotherapeutic, empiric, narrow spectrum of antibacterial coverage as a monotherapy that sufficiently covers all of the most common bacterial causes of CABP, including multi-drug resistant strains.

Difficult, Inconvenient and Costly Regimens

Currently available antibiotics used to treat CABP and other serious infections can be difficult, inconvenient and costly to administer. Physicians typically prefer IV administration for patients hospitalized with more serious illness to ensure adequate delivery of the drug rapidly.drug. Many IV antibiotics are prescribed for seven to 14 days or more and patients can be hospitalized for much or all of this period or require in-home IV therapy. The diagnosis related group, or DRG, reimbursement

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system often used in the U.S. hospital setting pays a fixed fee for an episode of CABP that may not fully compensate hospitals for the duration of hospitalized care. Prolonged IV treatment that extends the period of hospitalization may cause hospital costs to increase in excess of the fixed reimbursement fee, resulting in significant negative financial impact on healthcare institutions. In addition, to address all likely bacterial pathogens in a patient with a more serious illness, IDSA guidelines recommend using a combination of antibiotics. Combination therapy presents the logistical challenge of administering multiple drugs with different dosing regimens and increasesmay increase the risk of drug-drug interactions. While IV treatment delivers the drug more rapidly than is possibletypical orally, once a patient is stabilized, oral treatment with the same drug would allowallows for more convenient and cost-effective out-patient treatment. Because many commonly used antibiotics are only available in IV form, a switch to an oral therapy often requires changing to a different antibiotic, which may be less effective for the patient.patient due to the different mechanism of action of the drug prescribed upon discharge.

Adverse Effects

Currently available antibiotic therapies can have serious side effects. These side effects may include severe allergic reaction,reactions, decreased blood pressure, nausea and vomiting, suppression of platelets, pain and inflammation at the site of injection, muscle, renal and oto-toxicity, optic and peripheral neuropathies, aortic dissection, valvular abnormalities, tendinopathy, hypoglycemia and headaches. At times, these side effects may be significant and require discontinuation of therapy. As a result, some treatments require clinicians to closely monitor patients'patients’ blood levels and other parameters, increasing the expense and inconvenience of treatment. This risk may be increasedincrease with combination therapy, which exposes patients to potential adverse effects from each of the antibiotics used in treatment. For example, fluoroquinolones are associated with tendon rupture, peripheral neuropathy and, peripheral neuropathy.more recently, valvular abnormalities, aortic aneurysm and/or dissection. In addition, fluoroquinolones have been associated with an increased frequency ofC.Clostridium difficile colitis, an overgrowth of a bacteria in the colon that produces a toxin that results in inflammation of the colon and repeated bouts of watery diarrhea. This has resulted in limitations on the use of fluoroquinolones in several countries. In November 2015, the FDA convened an Advisory Committee meeting to review the benefits and risks of

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fluoroquinolones in less severe indications, such as uncomplicated UTI, acute bacterial sinusitis and acute bacterial exacerbations of chronic bronchitis. Based on the committee'scommittee’s recommendation, in July 2016, the FDA approved changes to the labels of fluoroquinolones to indicate that fluoroquinolones should be reserved for use in patients who have no other treatment options for the indications mentioned above, because the risk of these serious side effects generally outweighs the benefits in these patients. These changes included a requirement that a separate patient Medication Guide be given with each prescription that describes the safety issues associated with this class of drugs. In December 2018, an FDA review found that fluoroquinolone antibiotics can increase the occurrence of rare but serious events of ruptures or tears in the main artery of the body, called the aorta. These tears, called aortic dissections, or ruptures of an aortic aneurysm can lead to dangerous bleeding or even death. They can occur with fluoroquinolones for systemic use given by mouth or through an injection. As a result, fluoroquinolone use has declined substantially in recent years.

cUTIsOur Solution: XENLETA for the treatment of CABP

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We believe that XENLETA, which is the first new class of antibiotic approved by the FDA in nearly 20 years for CABP, can fill the current treatment gap by providing clinicians the ability to treat a patient with suspected or confirmed CABP where there may be concerns about resistance, or adverse event profiles for available antibiotic classes, or for elderly patients or patients with co-morbidities where they are at higher risk for negative outcomes from pneumonia. XENLETA has demonstrated efficacy and a favorable safety profile as an empiric, short-course monotherapy for the treatment of CABP with targeted activity against Gram-positive, Gram-negative, and atypical bacteria that are commonly associated with CABP, including drug-resistant strains.​ The novel mechanism of action of XENLETA provides for a low risk of resistance development and low probability of cross resistance with other antibiotics, which is important given the increase in antimicrobial resistance to relevant CABP pathogens. XENLETA, with IV and oral formulations, and no need for a loading dose, has versatility to meet the health care provider and patient’s clinical needs. For example, XENLETA can be utilized in patients as an IV antibiotic in the hospital setting with discharge on oral therapy, which provides significant advantages to the patients’ health while potentially reducing the total cost of care to the hospital. Additionally, we believe a short course treatment with XENLETA oral monotherapy could benefit moderate to severe CABP patients treated in the Emergency Department, or ED, by potentially avoiding hospitalization. And finally, XENLETA can be utilized effectively in the community setting by primary care practitioners who can potentially avoid an ED visit, thereby, reducing patient hospitalization exposure and related significant associated costs to managed care plans.

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Complicated Urinary Tract Infections

Market Overview

Infections due to a bacterial pathogen that isare resistant to threeone or moremultiple antibiotic classes have become increasingly common and present a risk to our fight against infectious diseases and the management of complications in vulnerable patients. According to the CDC, more than two2.8 million hospital infections caused by bacteria resistant to one or more antibiotics occur every year in the United States, and over 23,00035,000 patients with an antibiotic-resistant pathogen die each year.

The prevalence of antibiotic-resistant bacteria is increasing and is considered a significant threat to global health. In particular, the CDC and the WHO consider antibiotic resistance to be an urgent and critical threat to human health. The prevalence of Beta-lactamaseβ-lactamase enzymes among Gram-negative

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pathogens threatens the usefulness of many Beta-lactamβ-lactam antibiotics and has resulted in greater reliance on last line antibiotics, including carbapenems.

        CUTIs,cUTIs, including AP, are among the most common infections due to MDR bacteria, including CRE, and are often healthcare-associated. Global mortality attributable to CRE infections has been estimated in some studies to be over 20% and reflects the need for safe, alternative, carbapenem-sparingcarbapenem-sparing.

Surveillance and epidemiological studies suggest that some traditional, first-linefirst line antibiotics may no longer be acceptable choices for early therapy. In one large-scalethird party, large scale surveillance study, approximately one out of three patients hospitalized in the United States with cUTI, a complicated intra-abdominal infection, hospital-associatedhospital associated pneumonia, or a bloodstream infection did not receive timely effective antibiotic therapy, and this delay was associated with increased morbidity and mortality. TheBased on third party studies, the rate of antibiotic resistance appears to be two to four times higher in patients who were admitted to the hospital from a nursing home or were recently hospitalized. Antibiotic therapy within the past six months has also been identified in these third party studies as a risk factor for antibiotic resistance.

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New classes of antibiotics that are effective against drug-resistant pathogens are needed for early, appropriate treatment of serious infections in hospitalized patients and to treat patients who have failed to respond to standard, first-line antibiotics due to acquired drug resistance.

For over 45 years, oral and IV formulations of fosfomycin have been used in the European Union,EU, Australia, Canada, Africa, Asia, and South America, and an oral formulation of fosfomycin has been used in the United States and Canada for the treatment of a variety of indications.States. Oral fosfomycin is available in the United States as single-dosesingle dose therapy for cystitis and is noted as an appropriate treatment option for cystitis in treatment guidelines by the Infectious Diseases Society of AmericaIDSA and the CDC. However, oral administration of fosfomycin provides inadequate concentrations that are required for treatment of more serious infections due to its limited bioavailability and dose-limitingdose limiting gastrointestinal tolerability.

Outside of the United States, IV fosfomycin is approved for patients with a variety of infections, often severe, including cUTI, bacteremia, osteomyelitis, nosocomial lower respiratory tract infections, surgical site infections, bone and joint infections, endocarditis, skin infections and bacterial meningitis. The efficacy and safety profile of IV fosfomycin has been established by more than 45 years of clinical use outside of the United States and has been evaluated in more than 60 clinical studies.trials. Fosfomycin has retained highin vitro activity with a low and stable resistance profile, and continues to be suitable for use as a monotherapy for cUTI despite long term use.

Causes of cUTIs

cUTI is defined as a clinical syndrome characterized by pyuria (the presence of puss in the urine) and a documented microbial pathogen on culture of urine or blood, accompanied by local and systemic signs and symptoms, including fever, chills, malaise, flank pain, back pain or costo-vertebral angle pain or tenderness that occur in the presence of a functional or anatomical abnormality of the urinary tract, or in the presence of catheterization. Indwelling urethral catheters account for 70% to 80% of cUTIs, or 1 million cases per year in the United States. Catheter-associated UTI is the most common cause of secondary bloodstream infections and is linked to increased morbidity and mortality. Patients with pyelonephritis, regardless of underlying abnormalities of the urinary tract, are considered a subset of patients with cUTI.

cUTI are usually caused by a greater variety of pathogens, with a greater likelihood of associated antimicrobial resistance, than uncomplicated UTIs, or uUTIs. Escherichia coli, or E. coli, is isolated in approximately 75% to 95% of uUTIs and approximately 50% of cUTIs and is the most common etiologic agent of cUTIs. Additional commonly-identified Gram-negative uropathogens include other Enterobacteriaceae (such as Klebsiella spp.spp., Proteus spp., Enterobacter cloacae)cloacae) and non-fermenting

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Gram-negative bacilli (such as Pseudomonas aeruginosa or P. aeruginosa, and Acinetobacter spp.spp.). Gram-positive organisms, such as Enterococci and coagulase-negative Staphylococci, may also be contributing pathogens.

Limitations of Currently Available Treatment Options

We believe bacterial resistance against antimicrobials has created the need for more antibiotic treatment options, particularly among MDR, Gram-negative bacilli (including CRE, ESBL, producers, and MDR P. aeruginosa)Pseudomonas aeruginosa). Gram-negative antimicrobial resistance is particularly common among urinary tract pathogens. Enterobacteriaceae, including E. coli and Klebsiella pneumoniae or K. pneumoniae,, may acquire plasmids that encode ESBLs and confer resistance to third-generation cephalosporins and other broad-spectrum antibiotics. Third-generation cephalosporins and Beta-lactamaseβ-lactamase inhibitors, or BLIs, are also commonly ineffective against Enterobacteriaceae that generate AmpC enzymes.

The recent spread into hospitals of Enterobacteriaceae expressing emergent Beta-lactamases,β-lactamases, including members of the serine carbapenemases and metallo-Beta-lactamases,metallo-β-lactamases, endanger antibiotic options. The lack of available and effective antibiotic classes for these organisms has created an unmet medical need. For example, infections with CRE are difficult to treat, as there are limited treatment choices available. Mortality rates as high as 40% to 50% have been associated with CRE infections, making them a serious threat to public health. The available treatment choices are associated with serious potential toxicity, in the case of colistin and aminoglycosides, or concerns of allergy or hypersensitivity, in the case of Beta-lactamsβ-lactams or penicillin derivatives.

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Our Solution: CONTEPO for the Treatment of cUTI

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CONTEPO is an IV formulation of fosfomycin and the sole member of the epoxide antibiotic class.



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CONTEPO has a different mechanism of action than other IV antibiotics in the United States.



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CONTEPO has a broad spectrum ofin vitro activity against a variety of clinically important MDR Gram-negative pathogens, including ESBL-producing Enterobacteriaceae, CRE, and Gram-positive pathogens, including methicillin-resistantStaphylococcus aureus, or MRSA, and vancomycin-resistant enterococci.



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CONTEPO has demonstrated inin vitro studies additivity or synergy when used in combination with other classes of antibiotic agents in pre-clinical trials.



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CONTEPO has a small molecular size, which may enable high levels of tissue penetration and facilitates renal elimination, both of which are important for treatment of cUTIs.



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CONTEPO is supported by a long history of IV fosfomycin use outside the United States in a variety of indications, including cUTI.



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CONTEPO has completed the ZEUS Study, a pivotal registrational Phase²/3 clinical trial in cUTI, achieving non-inferiority to an active comparator.

CONTEPO is a potentially first-in-class epoxide IV antibiotic in the United States with a broad spectrum of bactericidal Gram-negative and Gram-positive activity, including activity against many contemporary MDR strains that threaten hospitalized patients. IV fosfomycin has an extensive commercial history in markets outside the United States, where it has been used broadly for over 45 years to treat a variety of indications, including complicated urinary tract infections,cUTIs, bacteremia, pneumonia and skin infections.

Table of Contentsinfections with little resistance shown to date.

CONTEPO works differently than other IV antibiotics approved in the United States. CONTEPO inhibits an early step in bacterial cell wall synthesis, so the cell wall lacks integrity and the bacteria die quickly. We believe that because of its different mechanism of action, we have not observed any cross resistance to date between CONTEPO and any of the existing classes of intravenous antibiotics. In addition, CONTEPO has demonstrated inin vitro studies an additive or synergistic antibacterial effect with other classes of antibiotics when used in combination therapy in preclinical studies, and has been shown to restore susceptibility inof resistant strains.

Our Products and Product Development PipelineCandidate

LefamulinSIVEXTRO

Overview

        LefamulinSIVEXTRO (tedizolid phosphate) is a novel oxazolidinone class antibiotic to treat susceptible Gram-positive pathogens including MRSA, one of the serious public health threats identified by the CDC.

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SIVEXTRO, available in both IV and oral formulations, was approved by the FDA in 2014 for the treatment of adults with ABSSSI such as cellulitis, wound infections and erysipelas and in 2020 the label was expanded to include adolescents 12 years of age and older.

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Sales Promotion and Distribution Agreement with Merck & Co.

On July 15, 2020, we entered into a Sales Promotion and Distribution Agreement, or the Distribution Agreement, with MSD International GmbH, or MSD, and Merck Sharp & Dohme Corp., or Supplier, each a subsidiary of Merck & Co., Inc. Under the Distribution Agreement and subject to the satisfaction of certain conditions, MSD

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appointed us as its sole and exclusive distributor of certain products containing tedizolid phosphate as the active ingredient previously marketed and sold by Supplier and MSD under the trademark SIVEXTRO® for injection, intravenous use and oral use, or the Products, in the United States and its territories, or the SIVEXTRO Territory. SIVEXTRO is an oxazolidinone-class antibacterial indicated in adults and pediatric patients 12 years of age and older for the treatment of acute bacterial skin and skin structure infections caused by certain susceptible Gram-positive microorganisms. On April 12, 2021, in accordance with the terms of the Distribution Agreement, we began exclusive distribution of SIVEXTRO under our own National Drug Code, or NDC, and we recognize 100% of net product sales of SIVEXTRO in our results of operations.

Under the Distribution Agreement and subject to the fulfillment of certain conditions, including us having engaged sufficient sales representatives, restrictions relating to travel and physician office access in the SIVEXTRO Territory due to COVID-19 having continued to decrease in a sufficient portion of the SIVEXTRO Territory so as not to hinder the successful detailing of SIVEXTRO, we have been granted the right by MSD initially to promote the Products in the SIVEXTRO Territory and, upon satisfaction of additional conditions, including an increase in sales representatives, the right to exclusively distribute the Products in the SIVEXTRO Territory, including the sole right and responsibility to fill orders with respect to the Products in the SIVEXTRO Territory. We successfully satisfied those conditions, including the increase in the number of sales representatives, and began filling orders of SIVEXTRO with our own Nabriva NDC beginning on April 12, 2021. Subject to applicable law, we are entitled to determine the final selling prices of the Products charged by us to our customers at our sole discretion, subject to an overall annual limit on price increases, and will be solely responsible for sales contracting and all market access activities, including bidding, hospital listing and reimbursement. We are responsible for all costs related to the promotion, sale and distribution of the Products by us, as well as all costs required to meet our staffing obligations under the Distribution Agreement. We are obligated to use commercially reasonable efforts to promote and distribute the Products and to maximize the sales of the Products throughout the SIVEXTRO Territory. We have agreed to employ a sales force or retain the services of a contract sales organization to fulfill our obligations under the Distribution Agreement. We have secured a virtual and in-person sales effort with community-based expertise with Amplity Health, which is a contract sales organization, to replace our hospital-based sale force and began a small and focused sales effort for SIVEXTRO and XENLETA in September 2020. We expanded this effort to 60 sales representatives in 2021 and may expand it further. We also piloted a virtual promotion effort with incremental sales representatives in the third quarter of 2021.

Furthermore, a subsidiary of Merck will sell to us, and we have agreed to purchase SIVEXTRO from such subsidiary at specified prices in such quantities as we may specify. Although we are entitled, subject to appliable law, to determine the final selling prices of SIVEXTRO in our sole discretion, subject to an overall annual limit on price increases, we may not be able to sell SIVEXTRO at prices high enough to recoup our investment in a sales force and other commercialization activities.

XENLETA

Overview

XENLETA is a semi-synthetic derivative of the naturally occurring antibiotic, pleuromutilin, which was originally identified from a fungus calledPleurotus mutilius. Lefamulin inhibitsXENLETA is designed to inhibit the synthesis of bacterial protein, which is required for bacteria to grow. LefamulinXENLETA acts by binding to the peptidyl transferase center, or PTC, on the bacterial ribosome in such a way that it interferes with the interaction of protein production at two key sites known as the "A"“A” site and the "P"“P” site, resulting in the inhibition of bacterial proteins and the cessation of bacterial growth. Lefamulin'sXENLETA’s binding occurs with high affinity, high specificity and at molecular sites that are different than other antibiotic classes. We believe that lefamulin'sXENLETA’s novel mechanism of action is responsible for the lack of cross-resistance with other antibiotic classes that we have observed in our preclinical studies and clinical trials and a low propensity for

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development of bacterial resistance to lefamulin.XENLETA. The binding of lefamulinXENLETA to the PTC on the bacterial ribosome is depicted in the graphic below.

We believe that lefamulinXENLETA is well suited to be used empirically as monotherapy for the treatment of respiratory tract infections, such as CABP, because of its spectrum of antibacterial activity against both the typical and atypical pathogens causing CABP. XENLETA is a pleuromutilin antibacterial indicated for the treatment of adults with CABP including multi-drug resistant pathogens such as MRSA.caused by susceptible microorganisms. In addition, in preclinical studies, lefamulinXENLETA showed potent antibacterial activity against a variety of Gram-positive bacteria, Gram-negative bacteria and atypical bacteria, including multi-drug resistant strains. In preclinical studies and in Phase 1 clinical trials, lefamulinXENLETA achieved substantial concentrations in the epithelial lining fluid, or ELF, of the lung, the site infected during pneumonia. LefamulinXENLETA also provides the ability to switch from IV to oral therapy and maintain therapy with the same antibacterial treatment. The efficacy of lefamulinXENLETA in humans has been shown in a

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proof-of-concept clinical Phase 32 clinical trial with 207 patients with ABSSSI (acute bacterial skin and skin structure infections) comparing two lefamulinXENLETA doses (100 mg and 150 mg i.v. q12 h) with vancomycin (³ 1 000(≥ 1,000 mg) over 5-14 days. This trial enrolled patients with severe skin and skin structure infections, excluding any patients with minor and uncomplicated infections. In total, 90.8 % of patients in the Modified Intent to Treat, or mITT population hadS.Staphylococcus aureus infection; 69.1 % of patients had MRSA. There were consistent high response rates seen across all three treatment arms, across a wide range of clinical and microbiological outcomes. Furthermore, no development of resistance was observed for lefamulin or for vancomycin during the trial. Lefamulin treatment administered intravenously over 5 to 14 days was well tolerated. The types of treatment-emergent adverse events were consistent with a patient population under treatment for ABSSSI. Lefamulin prolonged the cardiac de- and repolarization duration but otherwise had a similar cardiac safety profile as vancomycin as assessed with standard 12-lead ECGs. The results of the clinical Phase 2 trial in ABSSSI provided the first proof of concept for the systemic use of a pleuromutilin antibiotic for the treatment of serious bacterial infections in humans. Thereafter, the clinical program for lefamulinXENLETA progressed with completion of two Phase 3 clinical trials in CABP (LEAP 1, LEAP 2). These trials demonstrated that lefamulinXENLETA treatment, administered as IV only, IV to oral, and oral only regimens, was non-inferior to the standard of care moxifloxacin for the treatment of adults with CABP. Each trial provided independent evidence of the treatment effect and safety in this population with unmet medical need. In May 2021, we and Sumitomo Pharmaceuticals (Suzhou) announced positive topline results from Sumitomo Pharmaceuticals (Suzhou)’s Phase 3 clinical trial of lefamulin in Chinese adults with CABP. Sumitomo Pharmaceuticals (Suzhou)’s multi-center, randomized, double-blind trial was designed to evaluate the safety and efficacy of IV to oral lefamulin compared to IV/oral moxifloxacin in 125 subjects with CABP. The results were similar to those observed in our global Phase 3 LEAP 1 and LEAP 2 clinical trials of lefamulin. Consistent with previously reported clinical trial results, lefamulin was observed to be generally well-tolerated, with an overall rate of treatment-emergent adverse events, or TEAEs, comparable to that of moxifloxacin. The vast majority of TEAEs in both treatment arms were mild-to-moderate in severity, with serious adverse events occurring in 4% of lefamulin-treated patients and 10% of moxifloxacin-treated patients. TEAEs leading to discontinuation were uncommon and observed in just 5% of subjects in both treatment arms.

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The FDA has designated each of the IV and oral formulations of lefamulinXENLETA as a QIDP, which provides for the extension of statutory exclusivity periods in the United States for an additional five years upon FDA approval of the product for the treatment of CABP and granted fast track designation to these formulations of lefamulin.XENLETA. Fast track designation is granted by the FDA to facilitate the development and expedite the review of drugs that treat serious conditions and fill an unmet medical need. The fast track designation for the IV and oral formulations of lefamulinXENLETA will allow for more frequent interactions with the FDA, the opportunity for a rolling review of any NDAs, we submit and eligibility for priority review and a shortening of the FDA'sFDA’s goal for taking action on a marketing application from ten months to six months. Two NDAs for IV and oral formulations of lefamulinXENLETA for treatment of CABP were submitted to the FDA December 19, 2018. We plan2018 and were approved on August 19, 2019. On July 16, 2020, we announced that Sunovion Pharmaceuticals Canada Inc., received approval from Health Canada to submitmarket oral and intravenous formulations of XENLETA for the treatment of CAP in adults, with the Notice of Compliance from Health Canada dated July 10, 2020. On July 28, 2020, we announced that the EC, issued a legally binding decision for approving of the marketing authorization application for lefamulinXENLETA for the treatment of CAP, in Europeadults when it is considered inappropriate to use antibacterial agents that are commonly recommended for initial treatment or when these agents have failed following a review by the EMA. The EMA approved XENLETA in the first halfEEA and the U.K. In September 2021, we and Sumitomo Pharmaceuticals (Suzhou) announced the approval received by Sumitomo Pharmaceuticals (Suzhou) to market oral and IV formulations of 2019.XENLETA for the treatment CAP in adults in Taiwan.

We own exclusive, worldwide rights to lefamulin,XENLETA, other than our rights in People’s Republic of China, Hong Kong, Macau, and Taiwan, which were licensed to Sinovant. LefamulinSumitomo Pharmaceuticals (Suzhou), and Canada, which was licensed to Sunovian. XENLETA is protected by issued patents in the United States, Europe and Japan covering composition of matter, which are scheduled to expire no earlier than 2028. We also have been granted patents for lefamulinXENLETA relating to process and pharmaceutical crystalline salt forms in the United States, which are scheduled to expire no earlier than 2031.2031 before any regulatory exclusivity such as QIDP or pediatric extensions are applied. In addition, we own a family of pending patent applications directed to pharmaceutical compositions of lefamulin,XENLETA, which if issued would be scheduled to expire no earlier than 2036.

Key Attributes of LefamulinXENLETA

We believe that the combination of the following key attributes of lefamulin,XENLETA, observed in clinical trials and preclinical studies, differentiates lefamulinXENLETA from currently available antibiotics and make lefamulinXENLETA well suited for use as a first-line or second-line empiric monotherapy for the treatment of CABP.

The preclinical studies and clinical trials we have conducted to date suggest that lefamulin'sXENLETA’s novel mechanism of action is responsible for the low risk of cross resistance observed with other antibiotic classes and a low propensity for development of bacterial resistance to lefamulin.XENLETA. As a result of the favorable safety and tolerability profile we have observed in our clinical trials to date, we believe lefamulinXENLETA has the potential to present fewer complications relative to the use of current therapies.

Based on our market research, we also believe that the availability of both IV and oral formulations of

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lefamulin, XENLETA, and an option to switch to oral treatment, could reduce the length of a patient'spatient’s hospital stay and the overall cost of care.

Targeted Spectrum of Activity for CABP Pathogens and Low Propensity for the Development of Bacterial Resistance

We expect lefamulin'sXENLETA’s spectrum of antibacterial activity against typical and atypical pathogens could eliminate the need to use a combination of antibiotics for the treatment of CABP. In our completed Phase 2 clinical trial, IV lefamulinXENLETA achieved a high cure rate against multi-drug resistant Gram-positive bacteria, including MRSA. In addition, in preclinical studies, lefamulinXENLETA showed activity against a variety of Gram-positive bacteria, includingS.Streptococcus pneumoniae andS.Staphylococcus aureus, that are resistant to other classes of antibiotics, Gram-negative bacteria, includingH.Haemophilus influenzae andM.Moraxella catarrhalis, and atypical bacteria, includingC.Chlamydophila pneumoniae,M.Mycoplasma pneumoniae andL.Legionella pneumophila. Included in lefamulin'sXENLETA’s spectrum of activity are all bacterial pathogens identified by IDSA as the most common causes of CABP for hospitalized patients who are not in

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the intensive care unit, as well as strains of the above listed bacteria that are resistant to other classes of antibiotics, including penicillins, cephalosporins, fluoroquinolones and macrolides.

Based on observations from our preclinical studies and clinical trials of lefamulin,XENLETA, as well as industry experience with pleuromutilins used in veterinary medicine over the last 3940 years, we believe that lefamulin'sXENLETA’s novel mechanism of action is responsible for the low risk of cross-resistance observed with other antibiotic classes and a low propensity for development of bacterial resistance to lefamulin.XENLETA.

Convenient Dosing Regimen; Potential for Switching from IV to Oral Treatment

We have developed both an IV and oral formulation of lefamulin,XENLETA, which we utilized in our clinical trials of lefamulinXENLETA for the treatment of CABP. The administration of lefamulinXENLETA as a monotherapy avoids the need for the complicated dosing regimens typical of multi-drug cocktails. We believe the availability of both IV and oral administration, and an option to switch to oral treatment, would be more convenient for patients and could reduce the length of a patient'spatient’s hospital stay and the overall cost of care. The potential reduction in the overall cost of care could be particularly meaningful to healthcare institutions, as the DRG reimbursement system pays a fixed fee for the treatment of CABP regardless of the length of hospital stay.

The efficacy and safety of lefamulinXENLETA in adult patients with CABP was shown in two pivotal Phase 3 clinical trials (LEAP 1 and LEAP 2). The two trials were designed in accordance with US and EU regulatory guidelines and conducted in parallel from 2016 to 2018. Design elements of the Phase 3 clinical trials were broadly comparable. Both were global, multicenter, randomized, double-blind, active-controlled, non-inferiority studies to establish the efficacy and safety of lefamulinXENLETA against the standard-of-care moxifloxacin in the treatment of adult subjects with CABP. In LEAP 1, subjects were treated with IV study drug and could be switched to oral study drug at the discretion of the Investigator after 3 full days (6 doses) of IV treatment if, in the opinion of the Investigator, pre-defined criteria were met. In LEAP 2, subjects were treated with lefamulinXENLETA for five days (ten doses) compared to seven days of moxifloxacin (seven doses).

LEAP 1 (IV to Oral) Phase 3 Clinical Trial

In LEAP 1, a total of 551 subjects with Pneumonia Outcomes Research Team (PORT) Risk Class III to V who required IV antibiotic therapy as initial treatment for the current episode of CABP were randomized 1:1 to treatment with lefamulinXENLETA 150 mg IV every 12 hours (n=276) or moxifloxacin 400 mg IV every 24 hours (n=275). Subjects could be switched from IV to oral study drug (lefamulin(XENLETA 600 mg orally every 12 hours or moxifloxacin 400 mg orally every 24 hours) at the discretion of the Investigator after three full days (six doses) of IV treatment if pre-defined criteria were met. If the

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investigator determined that MRSA was a probable pathogen at Screening, adjunctive linezolid 600 mg IV every 12 hours was to be added to the moxifloxacin group and linezolid placebo was to be added to the lefamulinXENLETA group.

The protocol defined different primary endpoints for the FDA and EMA to address regional differences in regulatory requirements for the development of antibacterial drugs to treat CABP. The FDA primary endpoint (EMA secondary endpoint) was the percentage of subjects with an Early Clinical Response, or ECR, of responder at 96 ± 24-hours after the first dose of study drug in the Intent-to-treat, or ITT, Analysis Set. The EMA co-primary endpoints (FDA secondary endpoints) were the percentages of subjects with an Investigator'sInvestigator’s Assessment of Clinical Response (IACR) of success at Test of Cure (TOC) Visit (5 to 10 days after the last dose of study drug) in the mITT and Clinically Evaluable at Test of Cure, or CE-TOC Analysis Sets.

Of the 551 subjects randomized, 546 received any amount of study drug (Safety Analysis Set: 273 lefamulin,XENLETA, 273 moxifloxacin). The mean total duration of study drug treatment (IV and oral combined) was approximately seven days in each treatment group. The two treatment groups were generally well balanced with respect to demographics and baseline characteristics. Overall, 59.9% of subjects were male. The overall mean age was 60.3 years; 43.6% were³65 ≥65 years and 18.1% were³75 ≥75 years. Overall, 72.1% of subjects were classified as PORT Risk Class III, 26.5% were PORT Risk Class IV, and 1.3% were PORT Risk Class V.

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LEAP 1 met its primary objective and demonstrated that lefamulinXENLETA is non-inferior to moxifloxacin with or without adjunctive linezolid for the treatment of adult subjects with CABP based on the FDA and EMA primary endpoints. The ECR responder rate (FDA primary endpoint) was 87.3% in the lefamulinXENLETA group and 90.2% in the moxifloxacin group (treatment difference –2.9%−2.9%; 95% CI: –8.5,−8.5, 2.8). The lower limit of the 95% CI for the difference in ECR responder rates was greater than the non-inferiority margin of –12.5%−12.5%. Success rates for IACR at TOC (EMA co-primary endpoints) were 81.7% in the lefamulinXENLETA group and 84.2% in the moxifloxacin group (treatment difference –2.6%−2.6%; 95% CI: –8.9,−8.9, 3.9) in the mITT group, and 86.9% in the lefamulinXENLETA group and 89.4% in the moxifloxacin group (treatment difference –2.5%−2.5%; 95% CI: –8.4,−8.4, 3.4) in the CE-TOC group. The lower limit of the 95% CI for the difference in IACR success rates was greater than the non-inferiority margin of –10%−10% for both groups.

Early Clinical Response rates for the most frequently identified baseline pathogens in the Microbiological Intent-to-treat, or microITT, group were:S.Streptococcus pneumoniae (88.2% lefamulinXENLETA vs 93.8% moxifloxacin),H.Haemophilus influenzae (92.2% lefamulinXENLETA vs 94.7% moxifloxacin), M.Moraxella catarrhalis (92.0% lefamulinXENLETA vs 100.0% moxifloxacin),M.Mycoplasma pneumoniae (84.2% lefamulinXENLETA vs 90.0% moxifloxacin),L.Legionella pneumophila (88.9% lefamulinXENLETA vs 85.7% moxifloxacin), andC.Chlamydophila pneumoniae (90.9% lefamulin(90.9% XENLETA vs 94.7% moxifloxacin). ECR responder rates forS.Staphylococcus aureus were 100.0% in both treatment groups. Responder rates among resistant pathogens were high in the lefamulinXENLETA group (eg,(e.g., 100.0% for penicillin-intermediateS.Streptococcus pneumoniae [PISP], penicillin-resistantS.Streptococcus pneumoniae [PRSP], multi-drug resistantS.Streptococcus pneumoniae, or MDRSP, and macrolide-resistantS.Streptococcus pneumoniae), although the number of resistant pathogens was low.

Both lefamulinXENLETA and moxifloxacin were well tolerated in the IV ± oral treatment regimens administered in the study. A similar rate of treatment-emergent adverse events, or TEAEs, was observed (38.1% vs 37.7% in the lefamulinXENLETA and moxifloxacin groups, respectively). Gastrointestinal events were the most frequently reported TEAEs in both treatment groups (6.6% lefamulin,XENLETA, 13.6% moxifloxacin), with the difference between groups driven by an imbalance in TEAEs of diarrhea (0.7% lefamulin,XENLETA, 7.7% moxifloxacin). No gastrointestinal TEAEs led to discontinuation of study drug in either treatment group.

Administration site reactions of any type occurred more frequently for lefamulinXENLETA (7.7%) than moxifloxacin (3.7%). The most common individual TEAE was infusion site pain, affecting eight (2.9%)

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subjects in the lefamulinXENLETA group, and no subjects in the moxifloxacin group. One subject in each treatment group had an infusion site reaction that led to discontinuation of study drug.

The incidence of TEAEs leading to discontinuation of study drug was 2.9% XENLETA and 4.4% for the lefamulin and moxifloxacin groups, respectively.moxifloxacin. The only TEAE preferred terms leading to discontinuation for more than 1 subject per treatment group were electrocardiogram (ECG) QT prolonged (one lefamulin-treatedXENLETA-treated subject and three moxifloxacin-treated subjects) and infectious pleural effusion (one lefamulin-treatedXENLETA-treated subject and two moxifloxacin-treated subjects).

Serious TEAEs occurred in 7.0% of subjects in the lefamulinXENLETA group and 4.8% of subjects in the moxifloxacin group and were most frequently reported in the Infections and Infestations System Organ Class,or SOC (2.9% lefamulin,XENLETA, 1.5% moxifloxacin).

Nine deaths (five in the lefamulinXENLETA group and, four in the moxifloxacin group) occurred by Day 28. Two additional deaths were reported after Day 28 (i.e., after the intended Late Follow-up [LFU] Visit): one lefamulin-treatedXENLETA-treated subject on Day 32 and one moxifloxacin-treated subject on Day 48. None of the deaths was assessed as related to study drug by the Investigators.

There were no clinically meaningful trends or pattern of changes identified in hematology or chemistry laboratory parameters. No subjects met Hy'sHy’s Law criteria.

LEAP 2 (Oral Only) Phase 3 Clinical Trial

In LEAP 2, a total of 738 subjects with PORT Risk Class II to IV who were appropriate candidates for oral antibiotic therapy for the current episode of CABP were randomized 1:1 to treatment with lefamulinXENLETA (n=370) or

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moxifloxacin (n=368). Subjects received either lefamulinXENLETA 600 mg orally every 12 hours for 5 days (10 doses) or moxifloxacin 400 mg orally every 24 hours for seven days (seven doses). The primary and secondary objectives were identical to those in LEAP 1.

Of the 738 subjects randomized, 736 received any amount of study drug (Safety Analysis Set: 368 lefamulin,XENLETA, 368 moxifloxacin). The mean duration of exposure to active lefamulinXENLETA was 5.0 days, compared with 6.7 days of active moxifloxacin, which reflects the intended duration of active treatment for each drug as per the study design. The two treatment groups were generally well balanced with respect to demographics and baseline characteristics. Overall, 52.4% of subjects were male. The overall mean age was 57.5 years; 37.5% were³65 ≥65 years and 16.3% were³75 ≥75 years. Overall, 50.4% of subjects were classified as PORT Risk Class II, 37.7% were PORT Risk Class III, and 11.1% were PORT Risk Class IV.

LEAP 2 met its primary objective and demonstrated that lefamulinXENLETA is non-inferior to moxifloxacin for the treatment of adult subjects with CABP based on the FDA and EMA primary endpoints. The ECR responder rate (FDA primary endpoint) was 90.8% in the lefamulinXENLETA group and 90.8% in the moxifloxacin group (treatment difference 0.1%; 95% CI: –4.4,−4.4, 4.5). The lower limit of the 95% CI for the difference in ECR responder rates was greater than the non-inferiority margin of –10%−10%. Success rates for IACR at TOC (EMA co-primary endpoints) were 87.5% in the lefamulinXENLETA group and 89.1% in the moxifloxacin group (treatment difference –1.6%−1.6%; 95% CI: –6.3,−6.3, 3.1) in the mITT group, and 89.7% in the lefamulinXENLETA group and 93.6% in the moxifloxacin group (treatment difference –3.9%−3.9%; 95% CI: –8.2,−8.2, 0.5) in the CE-TOC group. The lower limit of the 95% CI for the difference in IACR success rates was greater than the non-inferiority margin of –10%−10% for both groups.

Early Clinical Response rates for the most frequently identified baseline pathogens in the microITT group were:S.Streptococcus pneumoniae (89.4% lefamulinXENLETA vs 91.3% moxifloxacin),H.Haemophilus influenzae (89.3% lefamulinXENLETA vs 91.7% moxifloxacin),M.Mycoplasma pneumoniae (100.0% in both groups), M.Moraxella catarrhalis (85.7% lefamulinXENLETA vs 100.0% moxifloxacin),L.Legionella pneumophila (81.3% lefamulin(81.3% XENLETA vs 94.1% moxifloxacin), andC.Chlamydophila pneumoniae (93.8% lefamulinXENLETA vs 100.0% moxifloxacin). ECR responder rates forS.Staphylococcus aureus were 100.0% in both treatment groups. Responder rates among resistant pathogens were high in the

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lefamulin XENLETA group (eg,(e.g., 100.0% for PISP, PRSP, MDRSP, and MRSA), although the number of resistant pathogens was low.

Both lefamulinXENLETA and moxifloxacin were well tolerated in the oral treatment regimens administered in the study. The overall incidence of TEAEs was higher in the lefamulinXENLETA group (32.6%) than in the moxifloxacin group (25.0%), which was driven by a difference in the incidence of mild/moderate Gastrointestinal Disorders. For lefamulinXENLETA and moxifloxacin, respectively, the most frequently reported individual TEAEs in this category (and for the study overall) were diarrhea (12.2% vs 1.1%), nausea (5.2% vs 1.9%), and vomiting (3.3% vs 0.8%). Among the lefamulin-treatedXENLETA-treated subjects reporting each of these TEAEs, approximately 75% had mild events and the remainder had moderate events. The only severe gastrointestinal adverse event, which was also serious, was a case of inguinal hernia strangulated in a moxifloxacin-treated subject. There were no severe or serious gastrointestinal adverse events among lefamulin-treatedXENLETA-treated subjects. Furthermore, gastrointestinal events led to study drug discontinuation for 3 lefamulin-treatedXENLETA-treated subjects (due to vomiting or abdominal pain) and one moxifloxacin-treated subject (due to vomiting). One patient who had a positive clinical response to lefamulinXENLETA was later diagnosed with aC.Clostridium difficile infection during an extended hospital stay.

The incidence of TEAEs leading to discontinuation of study drug was 3.3% for the lefamulinXENLETA group and 2.4% for the moxifloxacin group.

Serious TEAEs occurred in 4.6% of lefamulin-treatedXENLETA-treated subjects and 4.9% of moxifloxacin-treated subjects, most frequently in the Infections and Infestations category (2.4% and 1.4%, respectively).

In each treatment group, three (0.8%) subjects died by Day 28. Deaths of two additional lefamulin-treatedXENLETA-treated subjects were reported after Day 28 (i.e., after the intended LFU Visit): one subject on Day 57 and one subject on Day 271. None of the deaths was assessed as related to study drug by the Investigators.

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No clinically meaningful trends or pattern of changes were identified in hematology or chemistry laboratory parameters. Two unique lefamulin-treatedXENLETA-treated subjects had either an ALT or an aspartate aminotransferase (AST) value >10 × the upper limit of normal, or ULN; in both cases the transaminase increases were transient with no associated increase in serum bilirubin. No subjects met Hy'sHy’s Law criteria.

Electrocardiogram analyses demonstrated increases from baseline in the QTcF interval in both treatment groups, but the magnitude of the change in the lefamulinXENLETA treatment group was smaller than that caused by moxifloxacin. In this study the mean change from baseline in QTcF interval at the steady state assessment was 9.5 msec for lefamulinXENLETA and 11.6 msec for moxifloxacin. Post-baseline QTcF increases of >60 msec occurred in 1.1% of lefamulin-treatedXENLETA-treated subjects and 1.9% of moxifloxacin-treated subjects. No associated cardiac arrhythmias of concern were observed. No adverse trends in vital signs in either treatment group were observed.

Phase 1 Pediatric Clinical Trial

Not unlike treatment of infectious diseases in adults, the management of pediatric infections has become more difficult due to the continuing rise in resistance in bacteria. Further complicating antimicrobial selection in the pediatric population is the need for agents to be very well tolerated and available in a final dosage form that can be easily administered to children. Based upon thein vitro antimicrobial spectrum of activity, along with the safety profile observed to date, we believe lefamulinXENLETA is appropriate for evaluation for the treatment of a variety of pediatric infections, including those affecting the respiratory tract and skin and skin structure. We have an agreed Pediatric Investigation Plan, or PiP, and Pediatric Study Plan, or PSP, with the EMA and FDA, respectively. Pediatric oral formulation development is ongoing with initiation of a relative bioavailability and pharmacokinetic study with said oral formulation in 2019, and we initiated a Phase 1 clinical trial evaluating safety, tolerability and PK of intravenous XENLETA in pediatric patients in mid-2018.

Table As a result of ContentsCOVID-19, research sites were temporarily closed for enrollment in 2020 and 2021 as hospitals suspended access and non-essential clinical research to focus on health care delivery to COVID-19 patients. As of July 2020, trials started to re-open, where allowed by the institution, and initiated screening of potential subjects at sites.

Additional Potential Indications for LefamulinXENLETA

STIsCystic Fibrosis

Cystic fibrosis, or CF, is a genetically inherited multi-system rare disorder caused by defects in the CFTR gene (CF transmembrane conductance regulatory), located on chromosome 7, with a gene carrier rate of 1 in 25. In many cases, CF is apparent soon after birth and most patients are diagnosed by age 3. Approximately 10% of those affected were diagnosed after 18 years of age, but this figure has decreased due to newborn screening.

The disruption in chloride transport at the cellular level leads to dehydrated secretions within the lungs. Hence, pulmonary disease is the leading cause of morbidity and mortality in patients with CF because impaired muco-ciliary clearance in the lungs leads to recurrent pulmonary infections, inflammation, bronchiectasis and progressive lung function decline. One of the major factors influencing the impact on the lungs is infection. Infections are a leading cause of loss of lung function and take a significant physical and emotional toll, making them a top concern for people with CF. The treatment landscape for infections is becoming more challenging as antimicrobial resistance (AMR) increases. It is estimated that approximately half of the CF population will continue to require improved anti-infective treatments over the next 20 years.

Staphylococcus aureus is a ubiquitous commensal bacterial pathogen isolated in the respiratory tract and is commonly colonized in the respiratory tracts of CF patients. It is one of the main causes of recurrent acute pulmonary infections. According to the 2020 CF Foundation Patient Registry, 63.3% of patients with CF have either methicillin-susceptible Staphylococcus aureus, orMSSA, MRSA, or a combination of the two. Looking at the specific resistance phenotypes, 48.9% of patients have MSSA. What is concerning many CF clinicians is the prevalence of MRSA, which was identified in 19.6% of patients because MRSA is associated with greater lung damage, pulmonary function deterioration and increased risk of death.

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Sexually Transmitted Infections

Urethritis and cervicitis caused byN.Neisseria gonorrhoeae,C.Chlamydia trachomatis, orM.Mycoplasma genitalium are frequently occurring sexually transmitted infections in the United States and Europe. Left untreated, these infections can cause serious health problems, particularly in women, including chronic pelvic pain, life-threatening ectopic pregnancy and infertility. Resistance in these organisms to the most commonly prescribed antibacterial treatments poses a serious public health threat. For example, the CDC estimates that 30%half of all infections of the clinical isolates ofN.Neisseria gonorrhoeaeare resistant to at least one currently available antibiotic.

In preclinical studies, lefamulinXENLETA has shown high potency againstN.Neisseria gonorrhoeae,C.Chlamydia trachomatis andM.Mycoplasma genitalium, including strains resistant to currently available antibacterial agents. As a result, we are actively assessing a non-clinical and clinical development plan to support the development of lefamulin as a first-line treatment for urethritis, cervicitis and pelvic inflammatory disease.

Osteomyelitis

The incidence of osteomyelitis, which is an infection of the bone, is increasing. The most common causative organism isS.Staphylococcus aureus. In the United States, the prevalence of MRSA in these cases ranges from 33% to 55%. Up to 90% of cases of hematogenous osteomyelitis, most frequently in children, are caused byS.Staphylococcus aureus. We believe that lefamulinXENLETA has the potential to be an effective treatment option for osteomyelitis. LefamulinXENLETA has shown substantial tissue penetration and activity against the most common causative organism in all forms of osteomyelitis. We believe that based on the safety profile observed to date, lefamulinXENLETA will be well tolerated for the long term use necessary for the treatment of both adult and pediatric patients with osteomyelitis. The current standard of care for these infections is treatment with vancomycin. We believe the ability to administer lefamulinXENLETA by either the IV or oral route would provide a significant advantage over agents,existing therapies, such as vancomycin, that can only be administered by IV.

Prosthetic Joint Infections

Infection occurs in approximately 1% of joint replacement surgeries. Although the incidence of infection has been decreasing, the total number of replacement operations has been rising, such that, overall, there is increasing morbidity. The majority of these infections are caused by three organisms: coagulase negative staphylococci,S.Staphylococcus aureus (including MRSA) and streptococci, all organisms that are susceptible to lefamulin.XENLETA. The preferred treatment for joint infections with MRSA is vancomycin, with daptomycin and linezolid as alternatives. Vancomycin and daptomycin are administered only by IV for this indication, and linezolid has side effects that affect long term use. We believe that lefamulinXENLETA could provide an alternative for both IV and oral therapy for these infections cases.

        AlthoughA 2018 Cochrane Review on interventions for the eradication of MRSA in people with cystic fibrosis reviewed the available literature to evaluate the effectiveness of current treatment regimens. Despite showing MRSA eradication in CF patients is possible, it is not clear what the long- term implications are as only two studies were identified and the quality of the evidence was found to be very low or low for the different outcomes. For acute pulmonary exacerbations due to MRSA, treatment with trimethoprim-sulfamethoxasole or doxycycline, and for moderate or severe exacerbations or if the prior regimens fail, treatment with oral linezolid, intravenous vancomycin or intravenous ceftaroline is recommended. There are limited treatment options in patients and each of the aforementioned drugs have potential safety concerns such as hypersensitivity reactions, bone marrow suppression or renal toxicity. More information on dosage and administration is needed to evaluate the effectiveness of antibiotic therapy to ensure optimal patient outcomes. Hence, there is an unmet need for new treatment options to treat Staphylococcal pulmonary infections, specifically acute pulmonary exacerbations due to MRSA.

We believe XENLETA has an opportunity to provide CF patients with MRSA infection an alternative treatment option. XENLETA is a potent anti-staphylococcal antibiotic from the pleuromutilin class. It has been demonstrated to be highly effective in in vitro and in vivo studies of Staphylococcus aureus infection, both MSSA and MRSA. Further it has been shown to achieve high concentrations in the lung fluid and lung macrophages. XENLETA has been developed and approved for the treatment of community-acquired bacterial pneumonia (including those caused by Staphylococcus aureus) in the U.S., EU, and Canada as an oral tablet and a sterile intravenous product. XENLETA is not metabolized

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renally and is not nephrotoxic. We believe the confluence of non-clinical and clinical data, as well as the availability of a well-tolerated and effective oral formulation uniquely positions lefamulin to potentially address the major unmet need of exacerbations of cystic fibrosis caused by Staphylococcus aureus, both MSSA and MRSA. We initiated screening of our Phase 1 clinical trial to evaluate the pharmacokinetics, safety and tolerability of XENLETA in patients with CF in March 2022. Results from this trial will inform further development of XENLETA as a treatment for staphylococcal lung infections in this patient population.

Sexually Transmitted Infections

The CDC reports gonorrhea (caused by Neisseria gonorrhoeae) as one of the most common STIs in the US, with more than 800,000 cases estimated to occur each year. Left untreated, these infections can cause serious health problems, particularly for women, including chronic pelvic pain, life-threatening ectopic pregnancy, and infertility. Gonorrhea infection also increases a person’s risk of contracting and transmitting human immunodeficiency virus. Chlamydial infections and gonorrhea are the most frequently reported sexually transmitted and reportable infections in both Europe and the United States with high occurrence rates among young persons, particularly women.

The WHO has estimated that there are over 1.0 million new STI cases per day globally, the majority of which are asymptomatic. In 2020, the WHO estimated that there are 374.0 million new STI infections globally each year, of which 129.0 million are infected with Chlamydia trachomatis, 82.0 million are infected with Neisseria gonorrhoeae, 7.1 million are infected with Treponema pallidu and 156.0 million are infected with Trichomonas vaginalis.

The CDC estimates that approximately 20% of the population of the United States was infected with an STI organism on any given day in 2018, costing the healthcare system nearly $16.0 billion in healthcare costs alone. The total number of new cases of Chlamydia trachomatis and Neisseria gonorrhoeae reported to the CDC in 2018 was 4.0 million and 1.6 million, respectively.

STI organisms are progressively developing resistance to antibiotics prescribed for treatment: sulfonilamides, penicillin, cephalosporins, azithromycin, tetracycline, and ciprofloxacin, and gonococcal resistance to all of these antibiotics have been reported globally. Declining susceptibility to cefixime (an oral cephalosporin antibiotic) resulted in a change to the CDC treatment guidelines in 2015, so that dual therapy with ceftriaxone (an injectable cephalosporin) and azithromycin is now the only CDC recommended treatment regimen for gonorrhea. The emerging threat of cephalosporin resistance highlights the need for continued surveillance of Neisseria gonorrhoeaeantimicrobial susceptibility. In 2014, 38.2% of all Neisseria gonorrhoeaecollected in the national surveillance program exhibited resistance to penicillin, tetracycline, or ciprofloxacin or reduced susceptibility to cefixime, ceftriaxone, or azithromycin. Resistance or reduced susceptibility to one antibiotic was identified in 20.8% of isolates, to two in 9.6%, to three in 7.2%, to four in 0.5%, and to five in 0.1%. In 2019, the prevalence of ciprofloxacin resistance continued to increase to 35.4%, the highest recorded in the Gonococcal Isolate Surveillance Project (GISP).

Mycoplasma genitalium has become a well-established cause for STIs and several studies have demonstrated the association between Mycoplasma genitalium and urethritis in men and urethritis, cervicitis, endometritis, and pelvic inflammatory disease in women. Decreases in the treatment efficacy of azithromycin, and treatment failure after second line moxifloxacin leaves no validated treatment options for the treatment of Mycoplasma genitalium infections.

XENLETA is a highly potent novel antimicrobial of the pleuromutilin class. Initial in vitro studies demonstrated high susceptibility of STI pathogens to lefamulin. Notably, susceptibility of Chlamydia trachomatis (MIC50/90, 0.02/0.04 mg/liter) and susceptible and resistant Neisseria gonorrhoeae (MIC50/90, 0.12/0.5 mg/liter) were good, and susceptibility of Mycoplasma genitalium was excellent (MIC range, 0.002 to 0.063 mg/liter for multi-drug resistant strains). Given this high degree of in vitro susceptibility and its favorable safety profile, we have no current plansbelieve lefamulin holds great promise for a first-line antibiotic for the syndromic treatment of STIs, particularly in populations with high rates of resistance to developstandard-of-care antibiotics.

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Acute Bacterial Skin and Skin Structure Infections

The effect of lefamulin in treating ABSSSI was demonstrated in a Phase 2 clinical trial with 207 subjects with ABSSSI comparing two lefamulin doses (100 mg and 150 mg IV q12h) with vancomycin over 5-14 days. This clinical trial enrolled patients with significant skin and skin structure infections with a median lesion size of 175.0 cm2 (greater than the minimum surface area of 75 cm2 specified in the FDA draft guidance), excluding any patients with minor and uncomplicated infections. In total, 90.8% of patients in the MITT population had Staphylococcus aureus infection; 69.1% of subjects had MRSA. Lefamulin 100 mg and 150 mg had consistently high efficacy rates across a wide range of clinical and microbiological outcomes at several time points including the TOC, 7 to 14 days after the completion of therapy. These response rates were comparable to vancomycin. The clinical success rate at TOC with lefamulin 100 mg and 150 mg q12h treatment was high for indications other than CABP, weall subgroups of subjects defined by primary infection type, bacteremia status, diabetic status, baseline fever status, age group, antibiotic therapy category, prior treatment failure status, baseline area of erythema, baseline body mass index, and gender. No important differences between or among the compared subgroups in the response to lefamulin treatment were observed. The Day 3 clinical responder rate for lefamulin was also high and comparable to vancomycin.

We may advance these programs in the clinicinto clinical development based on available funding.

​

CONTEPO Clinical Development Program

Overview

CONTEPO is under development in the United States for the treatment of cUTI, including AP. The clinical development plan for CONTEPO utilized a modernized dosing regimen to optimize coverage of the predominant pathogens in hospital infections, including strains recognized by the CDC as an urgent or serious antibiotic resistant threat to public health in the United States. The FDA has designated CONTEPO as a QIDP. We submitted an NDA for marketing approval of CONTEPO for the treatment of cUTI in adults in the United States, to the FDA in October 2018. The NDA submission is utilizingutilized the 505(b)(2) regulatory pathway and is supported by a robust data package, including a pivotal Phase 2/3 clinical trial (known as

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ZEUS™), which met its primary endpoint of statistical non-inferioritynon inferiority to piperacillin/tazobactam in patients with cUTI, including acute pyelonephritis.AP. In April 2019, the FDA issued a CRL in connection with our NDA for CONTEPO for the treatment of cUTIs, including AP, stating that it was unable to approve our application in its current form. The CRL requested that issues related to facility inspections and manufacturing deficiencies at our active pharmaceutical ingredient contract manufacturer be addressed prior to the FDA approving the NDA. We requested a “Type A” meeting with the FDA to discuss its findings and this meeting occurred in July 2019. As the FDA did not request any new clinical data and did not raise any other concerns with regard to the safety or efficacy of CONTEPO in the CRL, the purpose of the meeting was to discuss and gain clarity on the issues related to facility inspections and manufacturing deficiencies at one of our contract manufacturers that were described in the CRL and other matters pertaining to the steps required for the resubmission of the NDA for CONTEPO. We resubmitted our NDA in December 2019 and the FDA acknowledged the resubmission in January 2020. On June 19, 2020, the FDA issued a second CRL on the NDA for CONTEPO. Although our European contract manufacturing partners were prepared for regulatory authority inspections, the CRL cited observations at our manufacturing partners that could not be resolved due to FDA’s inability to conduct onsite inspections because of travel restrictions caused by the COVID-19 pandemic. In general, previously identified product quality and facility inspection related observations at our contract manufacturing partners are required to be satisfactorily resolved before the NDA may be approved. The FDA did not request any new clinical data and did not raise any other concerns with regard to the safety or efficacy of CONTEPO in the second CRL. Our contract manufacturers continue to interact with FDA to discuss its plans for conducting inspections at their sites. On October 30, 2020, we participated in a “Type A” meeting with the FDA to obtain any new information related to the FDA’s pending conduct of inspections of foreign manufacturers during the COVID-19 pandemic that has granted usnegatively impacted a PDUFA target action datenumber of April 30, 2019FDA product reviews, including our NDA for CONTEPO. On April 14, 2021, the FDA issued industry guidance on remote interactive evaluations of drug manufacturing and bioresearch monitoring facilities during COVID-19 specifying that when it cannot perform a PAI or PLI or when the FDA determines that it would be useful to supplement a planned inspection, the agency will consider using tools other than a physical inspection and select the most appropriate method to address the specific risks that justify the need for the PAI or PLI. The FDA informed us that

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onsite inspections of our manufacturing partners in Europe are required in order for the FDA to complete the review of a potential CONTEPO NDA resubmission. Due to travel restriction related to the COVID-19 pandemic, the FDA suspended onsite inspections of ex-US manufacturers for all non-COVID products. As a result, we requested an extension of the timeline for a potential CONTEPO NDA resubmission until June 2023, which the FDA granted on March 21, 2022. We are awaiting further clarity from the FDA regarding their ability to complete onsite inspections at our manufacturing partners in Italy and Spain before determining specific timing of the potential NDA resubmission, which we plan to submit promptly once we have clarity from the FDA. We do not have a forecasted date for the resubmission of our NDA for CONTEPO for the treatment of cUTI, including AP.The FDA released the Resiliency Roadmap for FDA Inspectional Oversight that describes the systematic approach that FDA will utilize to manage postponed inspections and other oversight activities. The prioritization plan considers public health risks related to conducting an inspection, such as the impact of the product’s availability on public health, as well as investigator safety and travel restrictions/advisories. In addition, the FDA informed us that, while they cannot predict when an inspection may occur and when the pandemic may prevent the FDA from completing inspections, tier 1 mission-critical inspections and tier 2 higher priority inspections, which includes PAIs, will continue to be prioritized going forward. We cannot predict the outcome of any further interactions with the FDA or when CONTEPO will receive marketing approval, if at all. CONTEPO has been granted QIDP and Fast Track designations by the FDA for the treatment of serious infections, including cUTI. However, we cannot predict when the NDA for CONTEPO for the treatment of cUTI, including AP, will be resubmitted or when CONTEPO would receive marketing approval, if at all.

Phase 2/3 Clinical Trial

The ZEUS Study was a multicenter, randomized, parallel-group, double-blind, pivotal Phase 2/3 clinical trial designed to evaluate safety, tolerability, efficacy and pharmacokinetics of CONTEPO compared to PIP-TAZ in the treatment of hospitalized adults with cUTI or AP. PIP-TAZ is a combination antibiotic consisting of a broad-spectrum antibiotic, piperacillin, plus a Beta-lactamaseβ-lactamase inhibitor, tazobactam, which extends the antibiotic spectrum of piperacillin to include many Beta-lactamase-producingβ-lactamase-producing bacteria that have acquired resistance to piperacillin alone. PIP-TAZ is widely used to treat serious Gram-negative infections. The primary objective of the ZEUS Study was to demonstrate that CONTEPO was non-inferior to PIP-TAZ in overall success based on clinical cure and microbiologic eradication in the microbiologic modified intent-to-treat, or m-MITT, population at the test-of-cure visit, or TOC, which occurred on the 19^th to 21^st day after completion of seven days of treatment with the study drug, or after up to 14 days of treatment for patients with concurrent bacteremia. The m-MITT population consisted of 362 patients, each of whom met the study'sstudy’s inclusion criteria, was randomized, received any amount of study drug, and had one or more baseline Gram-negative pathogens growing at greater than or equal to 10(5) CFU/mL from an appropriately collected, pre-treatment baseline urine or blood sample. The primary endpoint was a composite of the investigator'sinvestigator’s determination of clinical cure, meaning complete resolution or significant improvement of signs and symptoms that were present at baseline and no new symptoms, such that no further antimicrobial therapy is warranted, plus microbiologic eradication, meaning that the baseline bacterial pathogen was reduced to less than 10(4) CFU/mL on urine culture and, if applicable, negative on repeat blood culture, both in the m-MITT population at TOC. Any missing or presumed eradications were classified as indeterminates, and conservatively counted as failures in the overall success analysis.

All pathogens isolated from patients who had a baseline and TOC pathogen underwent blinded, post-hoc, pulsed-field gel electrophoresis, or PFGE, typing analysis. Microbiologic outcome was also defined utilizing the PFGE results, whereby microbiologic persistence required the same genus and species of baseline and post-baseline pathogens, as well as PFGE-confirmed genetic identity.

Patients eligible for the trial were required to be 18 years of age or older and have cUTI or AP that was considered by the clinical investigator to be serious enough to require hospitalization and IV antibiotic therapy. The diagnosis was based on pyuria, or the presence of pus or white blood cells in the urine, and cUTI or AP with at least two additional symptoms such as chills, rigors, or warmth associated with fever, nausea or vomiting, painful, difficult or frequent urination, lower abdominal or pelvic pain, or acute flank pain. Patients with cUTI were also required to have at least one risk factor, such as use of intermittent or indwelling bladder catheterization; functional or anatomical abnormality of the urogenital tract; complete or partial hindrance of normal urine flow; blood urea nitrogen greater than 20 mg/dL, blood urea greater than 42.8 mg/dL, or serum creatinine greater than 1.4 mg/dL, due to known prior renal disease; or, in male patients, chronic urinary retention. A baseline urine culture specimen was obtained within 48 hours

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prior to randomization, and any indwelling bladder catheters were required to be removed or replaced, unless such removal was considered unsafe or contraindicated, before or within 24 hours after randomization.

Eligible patients were randomly assigned to receive either CONTEPO (6 grams IV fosfomycin) or PIP-TAZ (4 grams piperacillin/0.5 grams tazobactam) as one-hour infusions three times daily for seven days, except patients with concurrent bacteremia, who could have received treatment for up to 14 days at the clinical investigator'sinvestigator’s discretion. Oral step down therapy was prohibited. Throughout the study, all patients were monitored for signs and symptoms of cUTI or AP and the occurrence of adverse events. Laboratory data, including chemistry panels, complete blood counts, electrocardiograms, and

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samples for urine and blood cultures were collected from all patients at specified times throughout the study.

Of the total of 465 patients randomized across 92 sites in 16 countries, with studies conducted at 74 sites in 15 countries, 464 (99.8%) received at least one dose of the study drug. Of the 464 patients who received at least one dose of study drug, 233 patients were in the CONTEPO treatment group, and 231 patients were in the PIP-TAZ treatment group. The incidence of premature discontinuation from study drug was low and similar between treatment groups (6.0% in the CONTEPO treatment group compared to 3.9% in the PIP-TAZ treatment group), and the incidence of not completing the study through the last follow-up visit, or LFU, which occurred on the 24^th through 28^th day after completion of seven days of treatment with the study drug, or after up to 14 days of treatment for patients with concurrent bacteremia, was 5.2% in the CONTEPO group compared to 0.9% in the PIP-TAZ group.

In the ZEUS Study, CONTEPO was non-inferior to PIP-TAZ for the primary efficacy outcome of overall success, which was defined as clinical cure and microbiologic eradication at TOC. Overall success occurred in 64.7% of CONTEPO patients and 54.5% of PIP-TAZ patients. The treatment difference between the CONTEPO and PIP-TAZ groups was 10.2%, with a 95% confidence interval (–(−0.4, 20.8). Additionally, the lower bound of the 95% confidence interval met the pre-specified non-inferiority margin of –15%−15%, demonstrating that CONTEPO was non-inferior to PIP-TAZ in the study. In a post-hoc primary efficacy analysis using results of blinded PFGE molecular typing of urinary tract pathogens, this difference was even greater (69.0% CONTEPO patients compared to 57.3% PIP-TAZ patients, with a treatment difference of 11.7%, with a 95% confidence interval (1.3, 22.1). Overall success rates were driven by microbiologic eradication rates, as clinical cure rates were greater than 90% and treatment differences were small at TOC. Using the PFGE molecular typing, the microbiologic eradication rates in the m-MITT population at the TOC were 70.7% for patients receiving CONTEPO compared to 60.1% for patients receiving PIP-TAZ. These rates were consistent with those observed in some contemporary cUTI studies, and most patients with microbiologic persistence at TOC had identifiable reasons or risk factors for persistence, such as functional or anatomical abnormalities of the urogenital tract, recent or indwelling urinary tract catheterization, elevated minimum inhibitory concentration, or MIC, to the study drug received, abbreviated study drug therapy, or other underlying co-morbidities. Of note, a majority of patients with microbiologic persistence at TOC were clinical cures at TOC, did not require rescue antimicrobial therapy, and remained sustained cures at LFU.

The identity and frequency of pathogens recovered at baseline from patients in the ZEUS Study were similar in both the CONTEPO and PIP-TAZ treatment groups. The most common pathogens identified were Enterobacteriaceae, identified in 96.2% of the CONTEPO patients and 94.9% of the PIP-TAZ patients, including E. coli, identified in 72.3% of the CONTEPO patients and 74.7% of the PIP-TAZ patients; K.Klebsiella pneumoniae, identified in 14.7% of the CONTEPO patients and 14.0% of the PIP-TAZ patients; Enterobacter cloacae species complex, identified in 4.9% of the CONTEPO patients and 1.7% of the PIP-TAZ patients; and Proteus mirabilis, identified in 4.9% of the CONTEPO patients and 2.8% of the PIP-TAZ patients. Gram-negative aerobes other than Enterobacteriaceae included Pseudomonas aeruginosa, which was identified in 4.3% of the CONTEPO patients and 5.1% of the PIP-TAZ patients, and Acinetobacter baumannii-calcoaceticus species complex, identified in 1.1% of the CONTEPO patients and no PIP-TAZ patients. These pathogens are representative of the pathogens that have been recovered in other studies of patients with cUTI or AP. For the predominant pathogens E. coli and K.Klebsiella pneumoniae, the clinical cure rates at TOC for CONTEPO were greater than 90% for both pathogens, and microbiologic eradication rates were 68.4%, or 72.9% with PFGE analysis, for E. coli, and 66.7% for K.Klebsiella pneumoniae on both a non-PFGE analysis and PFGE analysis-basis.

A total of 42.1% of CONTEPO patients and 32.0% of PIP-TAZ patients experienced at least one TEAE. Most TEAEs were mild or moderate in severity, and severe TEAEs were uncommon (2.1% of

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CONTEPO patients and 1.7%

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of PIP-TAZ patients). The most common TEAEs in both treatment groups were transient, asymptomatic laboratory abnormalities and gastrointestinal events. Treatment-emergent serious adverse events, or SAEs, were uncommon in both treatment groups (2.1% of CONTEPO patients and 2.6% of PIP-TAZ patients). There were no deaths in the study and one SAE in each treatment group was deemed related to the study drug (hypokalemia in a CONTEPO patient and renal impairment in a PIP-TAZ patient), leading to study drug discontinuation in the PIP-TAZ patient. Study drug discontinuations due to TEAEs were infrequent and similar between treatment groups (3.0% of CONTEPO patients and 2.6% of PIP-TAZ patients).

The most common laboratory abnormality TEAEs were increases in the levels of alanine aminotransferase (8.6% of CONTEPO patients and 2.6% of PIP-TAZ patients) and aspartate transaminase (7.3% of CONTEPO patients and 2.6% of PIP-TAZ patients). None of the aminotransferase elevations were symptomatic or treatment-limiting, and none of the patients met the criteria for Hy'sHy’s Law. Outside of the United States, elevated liver aminotransferases are listed among undesirable effects in labeling for IV fosfomycin.

Hypokalemia occurred in 71 of 232 (30.6%) CONTEPO patients and 29 of 230 (12.6%) PIP-TAZ patients. Most decreases in potassium levels were mild to moderate in severity. Shifts in potassium levels from normal at baseline to hypokalemia, as determined by worst post-baseline hypokalemia values, were more frequent in the CONTEPO group than the PIP-TAZ group for mild (17.7% compared to 11.3%), moderate (11.2% compared to 0.9%), and severe (1.7% compared to 0.4%) categories of hypokalemia. Hypokalemia was deemed a TEAE in 6.4% of patients receiving CONTEPO and 1.3% of patients receiving PIP-TAZ, and all cases were transient and asymptomatic. While no significant cardiac adverse events were observed in the ZEUS Study, post-baseline QT intervals calculated using Fridericia'sFridericia’s formula, or QTcF, of greater than 450 to less than or equal to 480 msec (baseline QTcF of less than or equal to 450 msec) occurred at a higher frequency in CONTEPO patients (7.3%) compared to PIP-TAZ patients (2.5%). In the CONTEPO arm, these results appear to be associated with the hypokalemia associated with the salt load of the IV formulation.

Phase 1 Pediatric Clinical Trial

In June 2018, we initiated a Phase 1, non-comparative, open-label study of the pharmacokinetics and safety of a single dose of CONTEPO in pediatric subjects less than 12 years of age receiving standard-of-care antibiotic therapy for proven or suspected infection or peri-operative prophylaxis. A total of 24 patients are expected to be enrolled at up to ten clinical sites in the United States. We anticipate completing enrollmentAs a result of COVID-19, research sites were temporarily closed in this trial2020 and 2021 and only a minority of sites are currently screening patients and allowing access to the institution. As a result, our development timeline for CONTEPO for use in late 2020.pediatric patients with cUTIs has been modified to reflect a two-year delay due to COVID-19.

Potential Additional Indications for CONTEPO

Fosfomycin has a long history of use outside the United States in a variety of indications beyond cUTI. The FDA has granted both Fast Track and QIDP designations for the investigation of CONTEPO for the following indications in addition to cUTI:

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Complicated intra-abdominal infections (cIAI)



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Hospital-acquired bacterial pneumonia (HABP)



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Ventilator-associated bacterial pneumonia (VABP)



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Acute bacterial skin and skin structure infections (ABSSSI)

Although we have no current plans to develop CONTEPO for indications other than cUTI, including AP, these designations make CONTEPO eligible for Fast Track and GAIN incentives. We may advance these programs in the clinic based on available non-dilutive funding.

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In August 2017, Zavante entered into an agreement with the United States National Institute of Allergy and Infectious Diseases, or NIAID, under which NIAID will conduct a clinical trial to assess CONTEPO'sCONTEPO’s intrapulmonary penetration and pharmacokinetics in support of the product candidate'scandidate’s potential future development as a treatment for HABP and VABP. This bronchoalveolar lavage study, or the BAL study, will measure CONTEPO'sCONTEPO’s pulmonary penetration by assessing drug concentrations in the lining of study subjects'subjects’ bronchial pathways. Diffusion and saturation of antibiotics in patients'patients’ airways are considered important factors in assessing a drug'sdrug’s ability to effectively treat lower-respiratory tract infections. Prior preclinical and clinical investigations of IV fosfomycin have demonstrated that the product candidate penetrates rapidly into tissues and achieves clinically relevant concentrations in urine, soft tissues, lungs and other organs, supporting CONTEPO'sCONTEPO’s potential versatility as an antibiotic treatment option. The protocol for thePhase 1 BAL studyclinical trial is currently under development in conjunction with NIAID, and we anticipate that theenrolling study will be initiated in mid-2019.subjects.

China Region License Agreement with Sinovant Sciences

In March 2018, we entered into a license agreement, or the China Region License Agreement, with Sinovant Sciences, Ltd., or Sinovant, an affiliate of Roivant Sciences, Ltd., to develop and commercialize lefamulin in the greater China region. As part of the China Region License Agreement, Nabriva Therapeutics Ireland DAC and Nabriva Therapeutics GmbH, our wholly owned subsidiaries, granted Sinovant an exclusive license to develop and commercialize, and a non-exclusive license to manufacture, certain products containing lefamulin, or the China Region Licensed Products, in the People'sPeople’s Republic of China, Hong Kong, Macau, and Taiwan, (togethertogether the "Territory"). We retain developmentExtended China Territory. In May 2021, we entered into an assignment, assumption and commercialization rightsnovation agreement, or the Assignment Agreement, pursuant to which we consented to the assignment by Sinovant, an affiliate of Roivant Sciences, Ltd., of the China Region License Agreement to develop and commercialize lefamulin in the restgreater China region to Sumitomo Pharmaceuticals (Suzhou), a wholly-owned subsidiary of Sumitomo Dainippon Pharma Co., Ltd., or Sumitomo. Pursuant to the Assignment Agreement, we agreed to release Sinovant and its affiliates from their obligations under the China Region License Agreement and consented to Sumitomo Pharmaceuticals (Suzhou)’s assumption of such obligations. In addition, Sumitomo has agreed to guarantee all of the world.obligations of Sumitomo Pharmaceuticals (Suzhou) under the China Region License Agreement.

Under the China Region License Agreement, SinovantSumitomo Pharmaceuticals (Suzhou) and our subsidiaries have established a joint development committee, or the JDC, to review and oversee development and commercialization plans in the Extended China Territory. We receivedThe China Region License Agreement includes milestone events consisting of a non-refundable $5.0 million upfront payment, pursuant to the terms of the License Agreement and are eligible for up to an additional $91.5 million in milestone payments upon the achievement of certain regulatory and commercial milestone events related to lefamulin for CABP, plus an additional $4.0 million in milestone payments if any China Region Licensed Product receives a second or any subsequent regulatory approval in the People'sPeople’s Republic of China. The first milestone wasWe received the $5.0 million upfront payment, a $1.5 million payment for the submission of a clinical trial application, or CTA, by Sinovant to the Chinese Food and Drug Administration thatFDA, which was received in February 2019. The remainingthe first quarter of 2019 and a $5.0 million milestone payments are tied to additional regulatory approvals and annual sales targets. In addition, wepayment in the third quarter of 2019 in connection with the Chinese FDA approval for lefamulin. We will also be eligible to receive low double-digit royalties on sales, if any, of China Region Licensed Products in the Extended China Territory. In December 2020, we announced the restructuring of our China Region License Agreement. The restructured agreement provided for additional manufacturing collaboration and regulatory support to be provided by us that is expected to help expedite the delivery of XENLETA to patients in the Extended China Territory. The restructured agreement also accelerated $3.0 million of the $5.0 million milestone payment to us that was previously payable upon regulatory approval of XENLETA in China, including a non-refundable upfront payment of $1.0 million which was received in the fourth quarter of 2020 and a $1.0 million milestone achieved during the first quarter of 2021.

        SinovantExcept for the manufacturing collaboration and regulatory support discussed above, Sumitomo Pharmaceuticals (Suzhou) will be solely responsible for all costs related to developing, obtaining regulatory approval of and commercializing China Region Licensed Products in the Extended China Territory and is obligated to use commercially reasonable efforts to develop, obtain regulatory approval for and commercialize China Region Licensed ProductProducts in the Extended China Territory. We are obligated to use commercially reasonable efforts to supply, pursuant to supply agreements to be negotiated by the parties, to SinovantSumitomo Pharmaceuticals (Suzhou) a sufficient supply of lefamulin for SinovantSumitomo Pharmaceuticals (Suzhou) to manufacture finished drug products for development and commercialization of the China Region Licensed Products in the Extended China Territory.

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Unless earlier terminated, the China Region License Agreement will expire upon the expiration of the last royalty term for the last China Region Licensed Product in the Extended China Territory, which we expect will occur in 2033. Following the expiration of the last royalty term, the license granted to SinovantSumitomo Pharmaceuticals (Suzhou) will become non-exclusive, fully-paid, royalty-free and irrevocable. The China Region License Agreement may be terminated in its entirety by SinovantSumitomo Pharmaceuticals (Suzhou) upon 180 days'days’ prior written notice at any time. Either party may, subject to specified cure periods, terminate the China Region License Agreement in the event of the other party'sparty’s uncured material breach. Either party may also terminate the China Region License Agreement under specified circumstances relating to the other party'sparty’s insolvency. We have the right to terminate the China Region License Agreement immediately if SinovantSumitomo Pharmaceuticals (Suzhou) does not reach certain development milestones by certain specified dates

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(subject (subject to specified cure periods). The China Region License Agreement contemplates that the we will enter into ancillary agreements with Sinovant,Sumitomo Pharmaceuticals (Suzhou), including clinical and commercial supply agreements and a pharmacovigilance agreement.

Sunovion License Agreement

In March 2019, we entered into the Sunovion License Agreement with Sunovion Pharmaceuticals Canada Inc., or Sunovion. As part of the Sunovion License Agreement, Nabriva Therapeutics Ireland DAC, our wholly owned subsidiary, granted Sunovion an exclusive license under certain patent rights, trademark rights and know-how to commercialize certain products containing XENLETA in the forms clinically developed by us or any of our affiliates, or the Sunovion Licensed Products in Canada in all uses in humans in CABP and in any other indication for which the Sunovion Licensed Products have received regulatory approval in Canada. Under the Sunovion License Agreement, Sunovion and Nabriva Therapeutics Ireland DAC established a joint development committee, or the Sunovion JDC, to review and oversee regulatory approval and commercialization plans in Canada. Sunovion will be solely responsible for all costs related to obtaining regulatory approval of and commercializing Sunovion Licensed Products in the Canada and is obligated to use commercially reasonable efforts to develop, obtain regulatory approval for, and commercialize Licensed Product in the Canada.

On November 7, 2019, we, through Sunovion, submitted a New Drug Submission, or NDS to market oral and intravenous formulations of XENLETA for the treatment of CAP in adults. Health Canada determined there was a screening deficiency in December 2019 and a response from us/Sunovion was provided on December 18, 2019 and acknowledged by Health Canada on January 13, 2020. Sunovion received approval from Health Canada to market oral and intravenous formulations of XENLETA for the treatment of community-acquired pneumonia in adults, with the Notice of Compliance from Health Canada dated July 10, 2020.

Named Patient Program Agreement with WE Pharma Ltd.

On June 30, 2020 we announced that WE Pharma Ltd., or WEP Clinical, a specialist pharmaceutical services company, had signed an exclusive agreement with us to supply XENLETA on a named patient or expanded access basis in certain countries outside of the US, China and Canada. The Named Patient Program, or NPP, is designed to ensure that physicians, contingent on meeting the necessary eligibility criteria and receiving approval, can request IV or oral XENLETA on behalf of patients who live in certain countries where it is not yet available and have an unmet medical need.

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Commercialization Strategy

We have distribution rights to SIVEXTRO in the United States pursuant to a Sales Promotion and Distribution Agreement, or the Distribution Agreement, with MSD International GmbH, or MSD, and Merck Sharp & Dohme Corp., or the Supplier, each a subsidiary of Merck & Co. Our initial target population for SIVEXTRO consisted of healthcare professionals who had historically prescribed SIVEXTRO for patients with ABSSSI. Other than in greater China and Canada where we have licensed development and commercialization rights to lefamulin,XENLETA, we own exclusive, worldwide rights to lefamulinXENLETA and U.S. rights to CONTEPO. We expect that ourOur initial target population for lefamulin will consistXENLETA consisted of patients with moderate to severe CABP whose antibiotic treatment is hospital-initiated. If lefamulin receives marketinghospital initiated. We received approval for XENLETA from the FDA forin August 2019 and launched the treatment of CABP, we plan to pursue commercialization strategies that maximize the value of lefamulinproduct in the United States withSeptember 2019. We previously utilized our own targeted hospital sales force and marketing organization that we planand in early 2020 began to expand beyond its current levels.target high value primary care physicians in

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the community near our target hospitals. Based on our market research, we believe lefamulinXENLETA has an innovative profile supporting adoption in the United States for adult hospital-hospital initiated CABP patients, treated both as in-patientsin patients as well as outpatient-transitionoutpatient transition of care from the hospital to the community, which we believe represents a significant commercial opportunity. Due to market factors in 2020, including the COVID-19 pandemic, we transitioned to a community-based sales effort. In the third quarter of 2020 we secured a contract sales organization and began promoting SIVEXTRO and XENLETA to community-based healthcare providers. We believeanticipate that we will effectively be able to effectively communicate lefamulin'sSIVEXTRO’s and XENLETA’s differentiating characteristics and key attributes to clinicians hospital pharmacies and payors with the goal of establishing favorable reimbursement for outpatients as well as a favorable formulary status in targeted hospitals. Additionally, we believe that our plans for an initial targeted hospital-focused sales force should allow us to address—on our own—the hospital-initiated treatment market for CABP in the United States in an efficient and effective way. There is also a significant opportunity for lefamulin to be used in the community for CABP patients, given its versatile profile, and this may represent a future expanded use. We plan to continue our pre-commercialization activities to prepare for a potential commercial launch of lefamulin, subject to receiving marketing approval in the United States.patients. Outside of the United States, we expect to utilize a variety of types of collaboration, distribution and other marketing arrangements with one or more third parties to commercialize lefamulin.XENLETA.

Along with additional market research, we believe that medical education will be a key component of our commercialization efforts and, following potential commercial launch, plan to invest in these activities to optimize the commercial potential of lefamulin. With a targeted initial prescribing base predominantly in the hospital setting, we expect that a targeted hospital sales and marketing organization would be relatively smaller than competitors who are focused on both the hospital and community prescribing base.XENLETA. We believe that lefamulin'sXENLETA’s novel mechanism of action, status as the only member of a new class of systemically administered pleuromutilins and anticipated clinical profile will support its potential favorable reimbursement, its potential inclusion on formularies and in local and national treatment guidelines, subject to and following marketing approval.guidelines.

We plan to evaluate the merits of entering into collaboration agreements with other pharmaceutical or biotechnology companies that may contribute to our ability to efficiently advance our product candidates, build our product pipeline and concurrently advance a range of research and development programs for a variety of indications outside the United States.

We own exclusive U.S. rights to CONTEPO. Our strategic intention, supported by CONTEPO'sCONTEPO’s differentiated profile, is to establish CONTEPO, if approved, as the standard of care in the United States for hospitalized patients with serious infections caused by suspected or confirmed MDR bacteria. We plan to useseek a targetedhospital based sales force to promote CONTEPO, and potentially XENLETA, to hospital-based healthcare professionals in key locations within the United States where MDR infections, including CRE, are concentrated. These include roughly 900 hospitals in high resistance locations such as New York City, Los Angeles and Chicago, and other major population centers.

        We currently have a team of regional business directors and medical science liaisons in the field performing educational and market development activities, respectively, for lefamulin and CONTEPO.

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We initially plan to use a targeted hospital-based sales force to promote both lefamulin formulations and CONTEPO, if approved.

Manufacturing

We do not own or operate, and currently have no plans to establish, manufacturing facilities for the production of clinical or commercial quantities of lefamulin,XENLETA, CONTEPO, or any of the other compounds that we are evaluating in our discovery program. We currently rely, and expect to continue to rely, on third parties for the manufacture of lefamulin,XENLETA, CONTEPO and any further products that we may develop. We have significant in-house knowledge and experience in (i) the relevant chemistry associated with our product candidates;XENLETA and (ii)CONTEPO; and the relevant manufacturing and supply chain processes associated with the commercial supply of our product candidates.XENLETA and CONTEPO. In addition to these internal resources, we engage third-party consultants, to assist in the management of our third-party manufacturers. We procure our supply of SIVEXTRO from Merck & Co., Inc.

We have engaged a limited number of third-party manufacturers to provide all of our starting materials, drug substance and finished product for use in clinical trials. The active pharmaceutical ingredients, or API, and drug products have been produced under master service contracts and specific work orders from these manufacturers pursuant to agreements that include specific supply timelines and volume and quality expectations. We choose the third-party manufacturers of the drug substance based on the volume required and the regulatory requirements at the relevant stage of development. All lots of drug substance and drug products used in clinical trials are manufactured under current good manufacturing practices. Separate third-party manufacturers have been responsible for fill and finish services, and for labeling and shipment of the final drug product to the clinical trial sites.

LefamulinSIVEXTRO

In July 2020, we entered into a Sales Promotion and Distribution Agreement, with subsidiaries of Merck pursuant to which a subsidiary of Merck will sell, and we have agreed to purchase, SIVEXTRO at specified prices. We

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will rely on a subsidiary of Merck to supply SIVEXTRO to us, who in turn, relies on third party manufacturers for the production, packaging, and serialization of SIVEXTRO for our distribution.

XENLETA

We have entered into a long-term commercial supply agreement with SEL Biochem Xinjiang Co., Ltd, or SEL, and Fountain International Development Holding Limited for the supply of pleuromutilin, which is the key intermediate for lefamulinXENLETA API production. Under this agreement, SEL is required to manufacture and supply and we are required to purchase from SEL a specified percentage of our commercial requirements of pleuromutilin. The initial term of the agreement expires on August 28, 2022, subject to automatic renewal for successive three-year periods. EitherIt will remain in force until it is terminated by either party may elect not to renew the agreement by providingwith two-year prior written notice, beforeexpiring on or at any time after the endexpiry of the initial term or thea then-current three-year period renewal term. Either party may terminate the agreement for the other party'sparty’s uncured material breach or upon the occurrence of specified bankruptcy events.

The agreement includes customary supply terms, including product specifications, price, payment terms, requirements forecasting, delivery mechanics and quality assurance. Under the agreement, we have also negotiated a quality technical agreement pursuant to which SEL will conduct all quality control and release testing for the pleuromutilin produced under the agreement.

In November 2018 we entered into a long-term commercial supply agreement with Arran Chemical Company Limited, or Arran, for the supply of the chiral acid starting material required in the synthesis of lefamulinXENLETA API. Under this agreement Arran is required to manufacture and supply, and we are required to purchase from Arran the amount forecast for the first six months of a twelve-month rolling forecast provided monthly by us. The agreement term expires on November 12, 2023 and continues thereafter unless terminated by either party with not less than twelve months written notice. Either party may terminate the agreement for the other party'sparty’s uncured material breach or upon the occurrence of insolvency or bankruptcy events. The agreement includes customary supply terms including material specifications, price, payment terms, demand forecasting, delivery mechanics, and quality assurance.

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We have entered into a long-term commercial supply agreement with Hovione Limited, or Hovione, for the supply of lefamulinXENLETA API. Under this agreement, Hovione is required to manufacture and supply and we are required to purchase from Hovione a specified percentage of our commercial requirements of lefamulinXENLETA API. The agreement expires on November 22, 2025, subject to automatic renewal for successive two-year periods. Either party may elect not to renew the agreement by providing two-year prior written notice before the end of the initial term or the then-current renewal term. Either party may terminate the agreement for the other party's uncured material breach or upon the occurrence of specified bankruptcy events.

The agreement includes customary supply terms, including product specifications, price, payment terms, requirements forecasting, delivery mechanics and quality assurance. We are required to purchase a minimum of 750 kg to 1,500 kg per year of lefamulin API dependent on potential regulatory approval timing. Under the agreement, we have also negotiated a quality technical agreement pursuant to which Hovione will conduct all quality control and release testing for the pleuromutilin produced under the agreement. On August 4, 2021, we entered into an amendment to the agreement, under which Hovione agreed to cancel our May 2021 purchase order for XENLETA API, which represented our minimum purchase requirement under the Hovione Supply Agreement. In addition, pursuant to the First Amendment, Hovione agreed to reduce our annual minimum purchase requirements for XENLETA API to no minimum purchase requirement in 2021, by 50% from 2022 to 2024 and by 25% in 2025, in consideration for cash payments from us totaling €3.2 million and the right to a low single-digit royalty on total net sales of XENLETA in the United States for a period commencing on August 4, 2021 and ending on November 22, 2030, or the Royalty Term, which royalty payments shall be no greater than an aggregate of €10.0 million. If the aggregate amount of royalties payments received by Hovione under the First Amendment is less than an aggregate of €4.0 million, we are obligated to pay Hovione the difference in a lump sum payment at the end of the Royalty Term. In addition, pursuant to the First Amendment, Hovione agreed to extend the duration of the Hovione Supply Agreement from November 22, 2025 to November 22, 2030 with annual minimum purchase requirements for 2026 to 2030 at the newly agreed annual minimum purchase amount for 2025. Pursuant to the First Amendment, upon the occurrence of certain events of insolvency for us, any unpaid minimum annual commitment amounts and royalty amounts under the agreement will become immediately due and payable.

We have also entered into a long-term commercial supply agreement with Patheon UK Limited, or Patheon, for the supply of IV vials of lefamulin.XENLETA. Under this agreement, Patheon is required to supply and we are required to purchase a specified percentage of our commercial requirements of IV vials of lefamulin.XENLETA. The initial term of the agreement expires on December 31, 2023, subject to automatic renewal for successive two-year periods. Either party may elect not to renew the agreementbut it will remain in force until it is terminated by providing two-year prior written notice before the end of the initial term, and after the initial term, either party may terminate the agreement withupon 24-months prior written notice, expiring on or at any time.time after the expiry of the initial term. Either party may also terminate the agreement for the other party'sparty’s uncured material breach or upon the occurrence of specified bankruptcy events. We may also terminate the agreement if a governmental authority takes action that prevents us from importing,

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exporting, purchasing or selling the IV vials of lefamulin.XENLETA. Finally, Patheon may terminate the agreement if we assign any of our rights under the agreement to an assignee that it does not consider to be a creditworthy substitute or is a competitor of Patheon.

The agreement includes customary supply terms, including product specifications, batch size requirements, price, payment terms, requirements forecasting, delivery mechanics and quality assurance. Under the agreement, we have also negotiated a quality agreement pursuant to which Patheon will conduct all quality control testing for the IV vials of lefamulin.XENLETA. In November 2021, we entered into a side agreement effective January 1, 2021 to the long-term commercial supply agreement, reducing the annual binding volume requirements for IV vials of XENLETA for the years 2022 to 2025. The side agreement also provides for a discount on the amount due to Patheon for the minimum annual conversion revenue commitment for years 2020 and 2021.

In addition, we have entered into a long-term commercial supply agreement with Almac Pharma Services Limited, or Almac, for the commercial supply of lefamulinXENLETA tablets. Under this agreement, Almac is required to supply and we are required to purchase services relating to the manufactured tablets equaling a specified minimum annual spend. The initial term of the agreement expires on August 7, 2022, but it will remain in force until it is terminated by either party with 24-months prior written notice, expiring on or at any time after the expiry of the initial term. Either party may also terminate the agreement for the other party'sparty’s uncured material breach or upon the occurrence of specified bankruptcy events. The agreement includes customary supply terms, including payment terms, requirements forecasting, delivery mechanics and quality assurance. Under the agreement, we have also negotiated a quality technical agreement pursuant to which Almac will conduct all quality control testing for the tablets.

In August 2018, we entered into a commercial packaging and supply agreement, or the Packaging Agreement with Sharp Corporation, or Sharp, for the commercial packaging of lefamulinXENLETA acetate for oral and intravenous administration. Under the Packaging Agreement, Sharp has agreed to provide certain packaging services to us, including labeling, serialization and final packaging of the packaged products.

The Packaging Agreement has an initial five-year term ending December 31, 2023 and will automatically renew after the initial term for additional one-year terms unless either party gives notice

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of its intention to terminate the Packaging Agreement at least 90 days prior to the end of the then-current term. In addition, either party may terminate the Packaging Agreement for the other party'sparty’s uncured material breach, in addition to other specified events, including with respect to bankruptcy proceedings and governmental actions, in each case subject to notice, cure periods and other conditions set forth in the Packaging Agreement.

The Packaging Agreement includes customary supply terms, including product specifications, batch size requirements, price, payment terms, requirements forecasting, delivery mechanics and quality assurance. Under the agreement, we have also negotiated a quality agreement pursuant to which Sharp will conduct quality control testing for the packaged products.

        These six commercial supply agreements relating to lefamulin are filed as exhibits to this Form 10-K. Other than these six agreements, we do not have long-term agreements with any other third parties for the manufacture of commercial supplies of lefamulin, but we intend to enter into additional agreements with third-party contract manufacturers for additional commercial supplies of lefamulin pending potential regulatory approval.

        LefamulinXENLETA is a semi-synthetic organic compound of low molecular weight. The pleuromutilin core of the molecule is produced by fermentation and is manufactured on a significant scale by various manufacturers. The second part of the molecule is established from a readily accessible chiral starting material. We have selected the lefamulin based on its efficacy and safety profile, although it is also associated with reasonable cost of goods, ready availability of starting materials and ease of synthesis. The development stage production of lefamulinXENLETA was carried out at a significant scale and we believe, if required, the synthetic route to lefamulinXENLETA is amenable to further scale-up. The synthetic route does not require unusual, or specialized, equipment in the manufacturing process. Therefore, if any of our current or future drug substance manufacturers were to become unavailable for any reason, we believe there are a number of potential replacements, although delays may be incurred in identifying and qualifying such replacements.

CONTEPO

Effective July 28, 2016, Zavante, Laboratorios ERN, S.A. ("ERN"), or ERN, and Ercros, S.A. ("Ercros"), or Ercros entered into an amended and restated three-way agreement (the "Three-Way Agreement"“Three-Way Agreement”), which established the basis for related supply agreements with ERN and Ercros in anticipation of FDA approval of fosfomycin disodium and succinic acid injection for intravenous use filled, finished and packaged into containers for use by end users, ("Product")or Product, in the United States. Pursuant to the Three-Way Agreement, Zavante has the direct responsibility for the manufacture and supply of the commercial Product in the United States.

Under the Three-Way Agreement, (i) ERN has agreed to provide Zavante with certain technical documentation, (Technical Documentation")or Technical Documentation, and data required for submission of an NDA or Abbreviated New Drug Application("ANDA"),Application, or ANDA, as applicable, for the Product , and other assistance in connection with the submission of an NDA or ANDA, pursuant to the ERN Supply Agreement (as defined below); (ii) Ercros has agreed

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to provide Zavante with certain Technical Documentation and the manufacture and supply of a blend of fosfomycin disodium and succinic acid, (the "API Mixture")or API Mixture, for the manufacture of the Product, pursuant to the terms of the Ercros Supply Agreement (as defined below); and (iii) Zavante has agreed to obtain the commercial supply of the Product, under one or more separate agreements with third party manufacturers. The rights and obligations of each of the parties are set forth in each of the ERN Supply Agreement and the Ercros Supply Agreement.

In addition, pursuant to the Three-Way Agreement, Zavante is required to (i) contract with one or more third party manufacturers to provide quantities of the Product required by Zavante for commercial sale in the United States, perform validation activities as required by the FDA, and obtain FDA approval of such third party manufacturer'smanufacturer’s facilities and quality systems; (ii) use commercially

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reasonable efforts to file an NDA within one year of its receipt of all Technical Documentation for the NDA from ERN and Ercros; (iii) obtain and own all trademarks to be used for the Product in the United States and (iv) bear the cost and manage all clinical trials necessary for obtaining FDA approval of the Product and keep ERN and Ercros updated regarding the progress of such clinical trials.

The Three-Way-Agreement will continue in force and effect until the Ercros Supply Agreement and the ERN Supply Agreement have both been terminated or expired in accordance with the respective terms therein, or if the Three-Way Agreement is terminated upon mutual written agreement of all of the parties. The Three-Way Agreement contains, among other provisions, customary provisions relating to legal compliance and publicity.

Effective July 28, 2016, Zavante and Ercros entered into a manufacturing and supply agreement (the "Ercros“Ercros Supply Agreement"Agreement”) pursuant to the Three-Way Agreement. Under the Ercros Supply Agreement, Ercros has agreed, pursuant to purchase orders entered into under the Ercros Supply Agreement, to manufacture (i) the exclusive supply of the API Mixture for Zavante in support of filing an NDA or an ANDA, as applicable, and (ii) the commercial supply of fosfomycin disodium and succinic acid injection for intravenous use in the United States. In addition, Ercros has agreed to provide access to certain technical documentation as may be requested by Zavante in connection with the filing of an NDA.

The Ercros Supply Agreement has an initial ten-year term ending July 28, 2026 and will automatically renew after the initial term for additional two-year terms unless either party gives notice of its intention to terminate the Ercros Supply Agreement at least 18 months prior to the end of the then-current term. Either party may terminate the Ercros Supply Agreement for the other party'sparty’s uncured material breach, in addition to other specified events, including with respect to bankruptcy proceedings, governmental actions and legal proceedings, in each case subject to notice, cure periods and other conditions set forth in the Ercros Supply Agreement.

The Ercros Supply Agreement contains customary supply terms, including requirements forecasting, purchase orders, product specifications, price, payment terms, delivery mechanics and quality insurance. In addition, the Ercros Supply Agreement contains, among other provisions, customary representations and warranties by the parties, a grant by Ercros to Zavante of certain limited license rights to Ercros'Ercros’ intellectual property in connection with Zavante'sZavante’s performance under the Ercros Supply Agreement, certain indemnification rights in favor of both parties and customary confidentiality provisions.

Under the Ercros Supply Agreement, Zavante and Ercros have also entered into a quality agreement, pursuant to which Ercros will conduct all quality control and release testing for the API Mixture produced under the Ercros Supply Agreement.

Effective July 28, 2016, Zavante and ERN entered into an amended and restated pharmaceutical manufacturing and exclusive supply agreement, as amended on December 1, 2016, March 1, 2017, May 1, 2017 and December 20, 2017, pursuant to the Three-Way Agreement (the ERN Supply Agreement). Under the ERN Supply Agreement, each party is required to use commercially reasonable efforts to complete certain development activities required for submission of an NDA or an ANDA for fosfomycin sodium and succinic acid (the bulk formulation of CONTEPO). In addition, ERN has agreed to provide to Zavante (i) certain technical documentation and data as required by the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use'sUse’s guidelines and the FDA for submission of an NDA or an ANDA for the bulk formulation of CONTEPO, and (ii) certain regulatory support in connection with the bulk formulation of CONTEPO sold or intended for commercial sale and human use.

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Upon the first commercial sale of the bulk formulation of CONTEPO, Zavante is obligated to make a one-time cash payment to ERN and subsequent quarterly payments thereafter based on the number of vials of the bulk formulation of CONTEPO sold during each calendar quarter.

The ERN Supply Agreement has an initial ten-year term ending July 28, 2026 and will automatically renew after the initial term for additional two-year terms unless either party gives notice of its intention to terminate the ERN Supply Agreement at least 18 months prior to the end of the then-current term. Either party may terminate the ERN Supply Agreement by mutual written agreement and for the other party'sparty’s uncured material breach, in addition to other specified events, including with respect to bankruptcy proceedings and governmental actions, in each case subject to notice, cure periods and other conditions set forth in the ERN Supply Agreement.

The ERN

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Supply Agreement contains, among other provisions, customary representations and warranties by the parties, a grant to each party by the other party of certain limited license rights to such other party'sparty’s intellectual property in connection with the parties'parties’ performance of the services under the ERN Supply Agreement, certain indemnification rights in favor of both parties and customary confidentiality provisions.

On April 25, 2017, Zavante and Fisiopharma, S.r.l. ("Fisiopharma"), or Fisiopharma, entered into a manufacturing and supply agreement, as amended on May 8, 2017, (the "Fisiopharmaor the Fisiopharma Supply Agreement").Agreement. Under the Fisiopharma Supply Agreement, Fisiopharma has agreed, pursuant to purchase orders entered into under the Fisiopharma Supply Agreement, to manufacture and supply fosfomycin disodium for intravenous injection in bulk drug vials, (the "Bulkor the Bulk Drug Vials")Vials, to Zavante in support of filing an NDA or an ANDA, as applicable, and a specified percentage of Zavante'sZavante’s commercial requirements of Bulk Drug Vials for the United States.

The Fisiopharma Supply Agreement has an initial ten-year term ending April 25, 2027 and will automatically renew after the initial term for additional one-year terms unless Zavante gives notice of its intention to terminate the Fisiopharma Supply Agreement at least six months prior to the end of the then-current term. Either party may terminate the Fisiopharma Supply Agreement for the other party'sparty’s uncured material breach or upon the occurrence of specified bankruptcy events, and Zavante may terminate the Fisiopharma Supply Agreement upon the occurrence of other specified events, including with respect to governmental actions and legal proceedings instituted against Fisiopharma, in each case subject to notice, cure periods and other conditions set forth in the Fisiopharma Supply Agreement.

The Fisiopharma Supply Agreement contains customary supply terms, including requirements forecasting, purchase orders, product specifications, price, payment terms, delivery mechanics and quality insurance. In addition, it contains, among other provisions, customary representations and warranties by the parties, a grant to Fisiopharma of certain limited license rights of Zavante'sZavante’s intellectual property in connection with Fisiopharma'sFisiopharma’s performance of services under the Fisiopharma Supply Agreement, certain indemnification rights in favor of both parties, limitations of liability and customary confidentiality provisions.

Under the Fisiopharma Supply Agreement, Zavante and Fisiopharma have also entered into a quality control agreement, pursuant to which Fisiopharma will conduct all quality control and release testing for the bulk drug vials produced under the Fisiopharma Supply Agreement. Any default under the quality control agreement constitutes a default under the Ercros Supply Agreement.

On December 26, 2017, Zavante entered into a commercial packaging agreement, (the "PCIor the PCI Packaging Agreement")Agreement, with AndersonBrecon Inc., doing business as PCI of Illinois, ("PCI")or PCI for the commercial packaging of fosfomycin disodium for intravenous injection in bulk drug vials, (the "Packaged Product").or the Packaged Product. Under the PCI Packaging Agreement, PCI hashad agreed to provide certain packaging services to Zavante, including labeling, serialization and final packaging of the PCI Packaged Product.

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The PCI Packaging Agreement has an initial three-year term endingbeen extended until December 26, 2020 and will automatically renew after the initial term for additional one-year terms unless either party gives notice of its intention to terminate the PCI Packaging Agreement at least 120 days prior to the end of the then-current term. In addition, either party may terminate the PCI Packaging Agreement for the other party's uncured material breach, in addition to other specified events, including with respect to bankruptcy proceedings and governmental actions, in each case subject to notice, cure periods and other conditions set forth in the PCI Packaging Agreement.2022.

        The PCI Packaging Agreement contains customary supply terms, including product specifications, price, payment terms, delivery mechanics and quality insurance. In addition, it contains, among other provisions, customary representations and warranties by the parties, a grant to PCI of certain limited license rights of Zavante's intellectual property in connection with PCI's performance of services under the PCI Packaging Agreement certain indemnification rights in favor of both parties, limitations of liability and customary confidentiality provisions.

        Under the PCI Packaging Agreement, Zavante and PCI have also entered into a contract services quality agreement, which governs the responsibilities of each party regarding the quality aspects of packaging and release of PCI Packaged Product.

These five commercial supply agreements relating to CONTEPO are filed as exhibits to this Form 10-K. Other than these five agreements, we do not have long-term agreements with any other third parties for the manufacture of commercial supplies of CONTEPO, but we intend tomay enter into additional agreements with third-party contract manufacturers for additional commercial supplies of CONTEPO pending potential regulatory approval.

Competition

The biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products. While we believe that our technologies, knowledge, experience and scientific resources provide us with competitive advantages, we face potential competition from many different sources, including major pharmaceutical, specialty pharmaceutical and biotechnology companies, academic institutions, government agencies and private and public research institutions. AnyOur products compete, and any product candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

Many of our competitors may have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs. Smaller or early stage companies may also

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prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

Our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop. Our competitors also may obtain marketing approvals for their products more rapidly than we obtain approval for ours, 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 because in some cases insurers or other third-party payors seek to encourage the use of generic products. This may have the effect of making branded products less attractive, from a cost perspective, to buyers. We expect that if lefamulin is

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approved for CABP, it will beSIVEXTRO and XENLETA are priced at a significant premium over competitive generic products. This may make it difficult for us to replace existing therapies with lefamulin.SIVEXTRO and XENLETA.

The key competitive factors affecting the success of our product candidatesSIVEXTRO, XENLETA and CONTEPO are likely to be their efficacy, safety, convenience, price and the availability of coverage and reimbursement from government and other third-party payors.

There are a variety of available therapies marketed for the treatment of ABSSSI and CABP. Currently, the treatment of CABP is dominated by generic products. For hospitalized patients, combination therapy is frequently used. Many currently approved drugs are well-established therapies and are widely accepted by physicians, patients and third-party payors. We also are aware of various drugs under development or recently approved by the FDA for the treatment of ABSSSI and CABP, including omadacycline which was launched in February 2019 by Paratek Pharmaceuticals Inc., delafloxacin which was(Nuzyra approved by the FDA in October 2018 on behalf of Paratek Pharmaceuticals Inc. for both ABSSSI and CABP), delafloxacin (Baxdela approved by the FDA for ABSSSI in June 2017 and expanded for ABSSSI, and is marketed byCABP in October 2019 on behalf of Melinta Therapeutics Inc. which also have an ongoing Phase 3 clinical trial of delafloxacin for CABP), and oral nafithromycin which is in Phase(Phase 2 clinical development by Wockhardt Ltd. for CABP).

If approved, we expect CONTEPO will face competition from commercially available antibiotics such as ceftazidime-avibactam, meropenem-vaborbactam, ceftolozane-tazobactam, imipenem-cilastatin-relebactam, cefiderocol, tigecycline, plazomicin, and from other product candidates currently in development for the treatment of cUTI, including AP, such as imipenem-relebactamceftazidime-avibactam (Avycaz), meropenem-vaborbactam (vabomere), plazomicin (Zemdri), ceftolozane-tazobactam (Zerbaxa), as well as imipenem-cilastatin-relebactam (Recarbrio approved by the FDA in July 2019 on behalf of Merck & Co., Inc. ), cefiderocol (Fetroja approved by the FDA in November 2019 on behalf of Shionogi Inc.), or drugs under development such as tebipenem HBr (NDA to FDA for the Treatment of Complicated Urinary Tract Infections including Pyelonephritis in October 2021– Spero Therapeutics), cefepime-taniborbactam (under Phase 3 clinical development by Merck)Venatorx Pharmaceuticals), cefiderocolcefepime-enmetazobactam (under Phase 3 clinical development by Shionogi)Allecra Therapeutics), ETX0282-cefpodoxime proxetil (under Phase 1 clinical development by Entasis Therapeutics) tebipenem (under development by Spero), sulopenem (under development by Iterum Therapeutics), and LYS228 (under development by Boston Pharma), as well as generically available agents including carbapenems, aminoglycosides, and polymyxins.Novartis).

Intellectual Property

Our success depends in large part on our ability to obtain and maintain proprietary protection for our approved product, product candidates, technology and know-how, to operate without infringing the proprietary rights of others and to prevent others from infringing our proprietary rights. We strive to protect the proprietary technology that we believe is important to our business by, among other methods, seeking and maintaining patents, where available, that are intended to cover our approved product, product candidates, compositions and formulations, their methods of use and processes for their manufacture and any other inventions that are commercially important to the development of our business. We also rely on trade secrets, know-how, continuing technological innovation and in-licensing opportunities to develop and maintain our proprietary and competitive position.

As of January 31, 2019,2022, we owned 2226 different families of patents and patent applications, including 2124 families directed to the various pleuromutilin derivatives as compositions of matter, processes for their manufacture, and their use in pharmaceutical compositions and methods of treating disease. The remaining family istwo families are directed to ß-lactamase inhibitors.ß lactamase inhibitors and siderophore cephalosporin conjugates. Our patent portfolio includes 2320 issued U.S. patents, 23

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granted European patents 10 granted Chinese patents, 11 granted patents in Taiwan, 6 granted patents in Canada, 12 granted patents in Hong Kong and 1816 granted Japanese patents, as well as patents in other jurisdictions. We also have pending patent applications in the United States, Europe, China, Taiwan, Canada, Hong Kong, Japan and other countries and regions, including Asia, Australia, Eastern Europe, and South America, including notably Canada, Brazil, China, Israel India and TaiwanIndia among others.

All of these patents and patent applications are assigned solely to us and were either originally filed by us or originally filed by Sandoz and subsequently assigned to us.

As of January 31, 2019, our lead product candidate, lefamulin,2022, XENLETA, was protected by the following sevensix patent families:

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The first patent family includes patents and applications with claims directed to generic classes of compounds that include lefamulin and/or their use in the treatment of microbial infections. This family includes issued patents in the United States, Europe and Japan, as well as issued patents in 11 other jurisdictions. The standard term for patents in this family expires in 2021.

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The second patent family includes patents and applications with claims that specifically recite lefamulin and/or its use in the treatment of microbial infections. This family includes two issued patents in each of the United States, Europe and Japan, as well as issued patents in 21 other jurisdictions and 5 pending patent applications in other jurisdictions, including one divisional application in the United States. The standard term for patents in this family expires in 2028. A patent term adjustment of 303 days has already been obtained in the United States for one patent.



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The third patent family includes patents and applications with claims directed to the processes for the manufacture of lefamulin, crystalline intermediates useful in the processes, and the resulting crystalline salts. This family includes 16 granted patents including issued patents in the United States, Europe and Japan and 13 pending patent applications one each in Europe and Japan and 13 in other jurisdictions. The standard term for patents in this family expires in 2031.



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The fourth patent family includes patents and applications with claims directed to processes for the synthetic manufacture of crystalline intermediates useful in the manufacture of lefamulin. This family includes granted patents in Europe, the United States and Japan and granted patents in other jurisdictions and further pending applications. The standard term for patents in this family expires in 2031.



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The fifth patent family includes patents and applications with claims directed to pharmaceuticals and treatments forHelicobacter infection, including pleuromutilins, such as lefamulin. This family includes issued patents in the United States, Europe and one other jurisdiction. The standard term for patents in this family expires in 2023. A patent term adjustment of 921 days has already been obtained for the U.S. patent.



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A further patent family is directed to pharmaceutical compositions of lefamulin and covers 17 pending patent applications in various jurisdictions.



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The seventh patent family covers methods for purification of pleuromutilins and the PCT-application was recently published.

Our second most advanced product candidate, BC-7013, is covered specifically in one patent family with patents granted in the United States, Europe, and Japan, as well as nineJapan. In other jurisdictions and pending patent applications in other jurisdictions.ten patents of this family are granted. The standard term for patents in this family expires in 2027.

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The remaining 1317 pleuromutilin patent families are directed to either molecules in the intellectual property landscape surrounding our approved product and product candidates in development including specific medical use or molecules which can be potentially further developed by us but have not yet been pursued. All patent applications in these families have been filed at least in the United States andand/or Europe, and most have been filed in other countries. The majorityMany of these patent applications have already resulted in granted patents.

Finally, we own one patent family directed to ß-lactamaseß lactamase inhibitor compounds.compounds and one patent family directed to siderophore cephalosporin conjugates. Patent applications in thisthe ß lactamase inhibitors family have been filed and granted in the United States and Europe. The standard term for patents in this family expires in 2030. The published PCT patent application for the siderophore cephalosporin conjugates will be nationalized on or before the filing deadline.

Zavante holds onetwo issued United States patentpatents (U.S. 9,345,717)9,345,717 and U.S. 10,086,006) directed to methods for identifying dosing regimens that decrease the potential for on-therapy drug resistance. Zavante filed patent applications directed to dosing regimens of Fosfomycin in renally impaired patients. Additionally, Zavante has filed a patent application based on results from the ZEUS Study that relates to methods for treating patients with resistant bacterial infections and, specifically, Gram-negative bacterial infections. However, this patentthese patents may not ensure exclusivity through the patent termterms and we may not be able to secure any additional patent protection. We plan to rely on regulatory protection afforded to CONTEPO ^TM through orphan drug designations,QIDP designation, data exclusivity, and market exclusivity where available.

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The term of individual patents depends upon the legal term for patents in the countries in which they are obtained. In most countries, including the United States, the patent term is 20 years from the filing date of a non-provisionalnon provisional patent application. In the United States, a patent'spatent’s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the U.S. Patent and Trademark Office, or the USPTO, in examining and granting a patent, or may be shortened if a patent is terminally disclaimed over an earlier filed patent. The term of a U.S. patent that covers a drug, biological product or medical device approved pursuant to a pre-marketpre market approval, or PMA, may also be eligible for patent term extension when FDA approval is granted, provided that certain statutory and regulatory requirements are met. The length of the patent term extension is related to the length of time the drug is under regulatory review while the patent is in force. The Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-WaxmanHatch Waxman Act, permits a patent term extension of up to five years beyond the expiration date set for the patent. Patent extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval, only one patent applicable to each regulatory review period may be granted an extension and only those claims reading on the approved drug may be extended. Similar provisions are available in Europe, Canada, Taiwan and certain other foreign jurisdictions to extend the term of a patent that covers an approved drug, provided that statutory and regulatory requirements are met. Thus, in the future, if and when our product candidates receive approval by the FDA or foreign regulatory authorities, we expect to apply for additional patent term extensions on issued patents covering those products, depending upon the length of the clinical trials for each drug and other factors. The expiration dates of our patents and patent applications referred to above are without regard to potential patent term extension or other market exclusivity that may be available to us.us unless otherwise indicated that a patent term extension application has been filed.

In addition to patents, we may rely, in some circumstances, on trade secrets to protect our technology and maintain our competitive position. However, trade secrets can be difficult to protect. We seek to protect our proprietary technology and processes, in part, by confidentiality agreements with our employees, corporate and scientific collaborators, consultants, scientific advisors, contractors and other third parties. We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems.

Government Regulation

Government authorities in the United States, at the federal, state and local level, and in other countries and jurisdictions, including the European Union, extensively regulate, among other things, the research, development, testing, manufacture, quality control, approval, pricing, reimbursement, packaging, storage, recordkeeping, labeling, advertising, promotion, distribution, marketing, post-approval monitoring and reporting, and import and export of

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pharmaceutical products. The processes for obtaining regulatory approvals in the United States and in foreign countries and jurisdictions, along with subsequent compliance with applicable statutes and regulations and other regulatory authorities, require the expenditure of substantial time and financial resources.

Review and Approval of Drugs in the United States

In the United States, the FDA reviews, approves and regulates drugs under the federal Food, Drug, and Cosmetic Act, or FDCA, and associated implementing regulations. A company, institution, or organization which takes responsibility for the initiation and management of a clinical development program for such products, and for their regulatory approval, is typically referred to as a sponsor. The failure to comply with the applicable U.S. requirements at any time during the product development process, approval process or post-approval may result in delays to the conduct of study, regulatory review and subject an applicant and/ora sponsor to a variety of administrative or judicial sanctions, including refusal by the FDA to approve pending applications, withdrawal of an approval, imposition of a clinical hold, issuance of warning letters and other types of letters, product recalls, product seizures, total or partial suspension of production or distribution, adverse publicity, injunctions, fines, refusals of government

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contracts, restitution, disgorgement of profits, and civil or criminal investigations and penalties brought by the FDA and the U.S. Department of Justice, or DOJ, or other governmental entities, including state agencies.

        An applicantA sponsor seeking approval to market and distribute a new drug product in the United States must typically undertake the following before a product candidate will be approved by the FDA:

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completion of preclinical laboratory tests, animal studies and formulation studies in compliance with the FDA's good laboratory practice, or GLP, regulations;



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submission to the FDA of an investigational new drug application, or IND, which must take effect before human clinical trials may begin;



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approval by an independent institutional review board, or IRB, representing each clinical site before each clinical trial may be initiated;



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performance of adequate and well-controlled human clinical trials in accordance with good clinical practices, or GCP, to establish the safety and efficacy of the proposed drug product for each indication;



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completion of preclinical laboratory tests, animal studies and formulation studies in compliance with the FDA’s good laboratory practice, or GLP, regulations;

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design of a clinicial protocol and submission to the FDA of an investigational new drug application, or IND, which must take effect before human clinical trials may begin;

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approval by an independent institutional review board, or IRB, representing each clinical site before each clinical trial may be initiated;

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performance of adequate and well-controlled human clinical trials in accordance with good clinical practices, or GCP, to establish the safety and efficacy of the proposed drug product for each indication;

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preparation and submission to the FDA of a new drug application, or NDA, summarizing available data to support the proposed approval of the new drug product for the proposed use;

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review of the product application by an FDA advisory committee, where appropriate or if applicable and as may be requested by the FDA;

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satisfactory completion of one or more FDA inspections of the manufacturing facility or facilities at which the product, or components thereof, are produced to assess compliance with current Good Manufacturing Practices, or cGMP, requirements and to assure that the facilities, methods and controls are adequate to preserve the product’s identity, strength, quality and purity;

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satisfactory completion of FDA audits of clinical trial sites to assure compliance with GCPs and the integrity of the clinical data;

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payment of PDUFA fees and securing FDA approval of the NDA; and

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compliance with any post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy, or REMS, where applicable, and the potential to conduct post-approval studies required by the FDA.

Preclinical Studies

Before a new drug application, or NDA, summarizing available data to support the proposed approval of the new drug product for the proposed use;



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review of the product application by an FDA advisory committee, where appropriate or if applicable and as may be requested by the FDA;



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satisfactory completion of one or more FDA inspections of the manufacturing facility or facilities at which the product, or components thereof, are produced to assess compliance with current Good Manufacturing Practices, or cGMP, requirements and to assure that the facilities, methods and controls are adequate to preserve the product's identity, strength, quality and purity;



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satisfactory completion of FDA audits of clinical trial sites to assure compliance with GCPs and the integrity of the clinical data;



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payment of PDUFA fees and securing FDA approval of the NDA; and



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compliance with any post-approval requirements, including the potential requirement to implement a Risk Evaluation and Mitigation Strategy, or REMS, where applicable, and the potential to conduct post-approval studies required by the FDA.

Preclinical Studies

        Before an applicantsponsor begins testing a compound with potential therapeutic value in humans, the drug candidate enters the preclinical testing stage. Preclinical studies include laboratory evaluation of the purity and stability of the manufactured drug substance or active pharmaceutical ingredient and the formulated drug or drug product, as well asin

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vitro and animal studies to assess the safety and activity of the drug for initial testing in humans and to establish a rationale for therapeutic use. The conduct of preclinical studies is subject to federal regulations and requirements, including GLP regulations. Theregulations and standards and the United States Department of Agriculture’s Animal Welfare Act, if applicable.The results of the preclinical tests, together with manufacturing information, analytical data, any available clinical data or literature and plans for clinical studies, among other things, are submitted to the FDA as part of an IND. Additional long-term preclinical testing, such as animal tests of reproductive adverse events and carcinogenicity, may continue after the IND is submitted.

Companies usually must complete some long-term preclinical testing, such as animal tests of long term exposure and reproductive adverse events, and must also develop additional information about the chemistry and physical characteristics of the investigational product and finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The

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manufacturing process must be capable of consistently producing quality batches of the candidate product and, among other things, the manufacturer must develop methods for testing the identity, strength, quality and purity of the final product. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the candidate product does not undergo unacceptable deterioration over its shelf life.

The IND and IRB Processes

An IND is an exemption from the FDCA that allows an unapproved drug to be shipped in interstate commerce for use in an investigational clinical trial and a request for FDA authorization to administer an investigational drug to humans. Such authorization must be secured prior to interstate shipment and administration of any new drug that is not the subject of an approved NDA. In support of a request for an IND, applicantssponsors must submit a protocol for each clinical trial and any subsequent protocol amendments must be submitted to the FDA as part of the IND. In addition, the results of the preclinical tests, together with manufacturing information, analytical data, any available clinical data or literature and plans for clinical trials, among other things, are submitted to the FDA as part of an IND. The FDA requires a 30-day waiting period after the filing of each IND before clinical trials may begin. This waiting period is designed to allow the FDA to review the IND to determine whether human research subjects will be exposed to unreasonable health risks. At any time during this 30-day period, the FDA may raise concerns or questions about the conduct of the trials as outlined in the IND and impose a clinical hold or partial clinical hold. In this case, the IND sponsor and the FDA must resolve any outstanding concerns before clinical trials can begin.

Following commencement of a clinical trial under an IND, the FDA may also place a clinical hold or partial clinical hold on that trial. A clinical hold is an order issued by the FDA to the sponsor to delay a proposed clinical investigation or to suspend an ongoing investigation. A partial clinical hold is a delay or suspension of only part of the clinical work requested under the IND. For example, a specific protocol or part of a protocol is not allowed to proceed, while other protocols may do so. No more than 30 days after imposition of a clinical hold or partial clinical hold, the FDA will provide the sponsor a written explanation of the basis for the hold. Following issuance of a clinical hold or partial clinical hold, an investigation may only resume after the FDA has notified the sponsor that the investigation may proceed. The FDA will base that determination on information provided by the sponsor correcting the deficiencies previously cited or otherwise satisfying the FDA that the investigation can proceed.

A sponsor may choose, but is not required, to conduct a foreign clinical study under an IND. When a foreign clinical study is conducted under an IND, all FDA IND requirements must be met unless waived. When the foreign clinical study is not conducted under an IND, the sponsor must ensure that the study complies with FDA certain regulatory requirements, including GCP requirements, in order to use the study as support for an IND or application for marketing approval. Specifically, on April 28, 2008, the FDA amended its regulations governing the acceptance of foreign clinical studies not conducted under an investigational new drug application as support for an IND or a new drug application. The final rule provides that such studies must be conducted in accordance with good clinical practice, or GCP, including review and approval by an independent ethics committee, or IEC, and informed consent from subjects. The GCP requirements in the final rule encompass both ethical and data integrity standards for clinical studies. The FDA'sFDA’s regulations are intended to help ensure the protection of human subjects enrolled in non-IND foreign clinical studies, as well as the quality and integrity of the resulting data. They further help ensure that non-IND foreign studies are conducted in a manner comparable to that required for IND studies.

In addition to the foregoing IND requirements, an IRB representing each institution participating in the clinical trial must review and approve the plan for any clinical trial before it commences at that institution, and the IRB must conduct continuing review and reapprove the study at least annually. The

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IRB must review and approve, among other things, the study protocol and informed consent information to be provided to study subjects. An IRB must operate in

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compliance with FDA regulations. An IRB can suspend or terminate approval of a clinical trial at its institution, or an institution it represents, if the clinical trial is not being conducted in accordance with the IRB'sIRB’s requirements or if the product candidate has been associated with unexpected serious harm to patients.

Additionally, some trials are overseen by an independent group of qualified experts organized by the trial sponsor,applicant, known as a data safety monitoring board or committee, or DSMB. This group provides authorization as to whether or not a trial may move forward at designated check points based on unblinded safety data from the study to which only the DSMB has access. Suspension or termination of development during any phase of clinical trials may occur if it is determined that the participants or patients are being exposed to an unacceptable health risk. Other reasons for suspension or termination may be made by us based on evolving business objectives and/or competitive climate.

        Information about certain clinical trials must be submitted within specific timeframes to the National Institutes of Health, or NIH, for public dissemination on its ClinicalTrials.gov website.

Human Clinical Studies in Support of an NDA

Clinical trials involve the administration of the investigational product to human subjects under the supervision of qualified investigators in accordance with GCP requirements, which include, among other things, the requirement that all research subjects provide their informed consent in writing before their participation in any clinical trial. Clinical trials are conducted under written study protocols detailing, among other things, the inclusion and exclusion criteria, the objectives of the study, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated.

Human clinical trials are typically conducted in the following four sequential phases, which may overlap or be combined:

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Phase 1: The drug is initially introduced into healthy human subjects or, in certain indications such as cancer, patients with the target disease or condition and tested for safety, dosage tolerance, absorption, metabolism, distribution, excretion and, if possible, to gain an early indication of its effectiveness and to determine optimal dosage.



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Phase 2: The drug is administered to a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage.



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Phase 1: The drug is initially introduced into healthy human subjects or, in certain indications such as cancer, patients with the target disease or condition and tested for safety, dosage tolerance, absorption, metabolism, distribution, excretion and, if possible, to gain an early indication of its effectiveness and to determine optimal dosage.

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Phase 2: The drug is administered to a limited patient population to identify possible adverse effects and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases and to determine dosage tolerance and optimal dosage.

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Phase 3: The drug is administered to an expanded patient population, generally at geographically dispersed clinical trial sites, in well-controlled clinical trials to generate enough data to statistically evaluate the efficacy and safety of the product for approval, to establish the overall risk-benefit profile of the product, and to provide adequate information for the labeling of the product.

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Phase 4: Post-approval studies, which are conducted following initial approval, are typically conducted to gain additional experience and data from treatment of patients in the intended therapeutic indication.

A clinical trial sites, in well-controlledmay combine the elements of more than one phase and the FDA often requires more than one Phase 3 trial to support marketing approval of a product candidate. A pivotal trial is a clinical trial that is believed to satisfy FDA requirements for the evaluation of a product candidate’s safety and efficacy such that it can be used, alone or with other pivotal or non-pivotal trials, to generate enough data to statistically evaluatesupport regulatory approval. Generally, pivotal trials are Phase 3 trials, but they may be Phase 2 trials if the efficacydesign provides a well-controlled and safetyreliable assessment of the product for approval, to establish the overall risk-benefit profileclinical benefit, particularly in an area of the product, and to provide adequate information for the labeling of the product.



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Phase 4: Post-approval studies, which are conducted following initial approval, are typically conducted to gain additional experience and data from treatment of patients in the intended therapeutic indication.

Progress reports detailing the results of the clinical trials must be submitted at least annually to the FDA and more frequently if serious adverse events occur. In addition, IND safety reports must be submitted to the FDA for any of the following: serious and unexpected suspected adverse reactions; findings from other studies or animal orin vitro testing that suggest a significant risk in humans exposed to the drug; and any clinically important increase in the case of a serious suspected adverse reaction over that listed in the protocol or investigator brochure. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, or at all. Furthermore, the FDA or

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the sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects are being exposed to an unacceptable health risk. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution, or an institution it represents, if the clinical trial is not being conducted in accordance with the IRB's requirements or if the drug has been associated with unexpected serious harm to patients. The FDA will typically inspect one or more clinical sites to assure compliance with GCP and the integrity of the clinical data submitted.

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Concurrent with clinical trials, companies often complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the drug as well as finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the drug candidate and, among other things, must develop methods for testing the identity, strength, quality, purity, and potency of the final drug. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the drug candidate does not undergo unacceptable deterioration over its shelf life.

        UnderFinally, sponsors of clinical trials are required to register and disclose certain clinical trial information on a public registry (clinicaltrials.gov) maintained by the Pediatric Research Equity ActU.S. National Institutes of 2003, an NDA or supplement thereto must contain data that are adequateHealth. In particular, information related to assess the safetyproduct, patient population, phase of investigation, study sites and effectivenessinvestigators and other aspects of the drug product forclinical trial is made public as part of the claimed indications in all relevant pediatric subpopulations, andregistration of the clinical trial. The failure to support dosing and administrationsubmit clinical trial information to clinicaltrials.gov, as required, is a prohibited act under the FDCA with violations subject to potential civil monetary penalties of up to $10,000 for each pediatric subpopulation for whichday the product is safe and effective. With enactment of the Food and Drug Safety and Innovation Act, or the FDASIA, in 2012, sponsors must also submit pediatric study plans prior to the assessment data. Those plans must contain an outline of the proposed pediatric study or studies the applicant plans to conduct, including study objectives and design, any deferral or waiver requests, and other information required by regulation. The applicant, the FDA, and the FDA's internal review committee must then review the information submitted, consult with each other, and agree upon a final plan. The FDA or the applicant may request an amendment to the plan at any time. For drugs intended to treat a serious or life-threatening disease or condition, the FDA must, upon the request of an applicant, meet to discuss preparation of the initial pediatric study plan or to discuss deferral or waiver of pediatric assessments.violation continues.

        The FDA may, on its own initiative or at the request of the applicant, grant deferrals for submission of some or all pediatric data until after approval of the product for use in adults, or full or partial waivers from the pediatric data requirements. Additional requirements and procedures relating to deferral requests and requests for extension of deferrals are contained in FDASIA. Unless otherwise required by regulation, the pediatric data requirements do not apply to products with orphan designation.

Expanded Access to an Investigational Drug for Treatment Use

Expanded access, sometimes called "compassionate use,"“compassionate use”, is the use of investigational new drug products outside of clinical trials to treat patients with serious or immediately life-threatening diseases or conditions when there are no comparable or satisfactory alternative treatment options. The rules and regulations related to expanded access are intended to improve access to investigational drugs for patients who may benefit from investigational therapies. FDA regulations allow access to investigational drugs under an IND by the company or the treating physician for treatment purposes on a case-by-case basis for: individual patients (single-patient IND applications for treatment in emergency settings and non-emergency settings); intermediate-size patient populations; and larger populations for use of the drug under a treatment protocol or Treatment IND Application.

When considering an IND application for expanded access to an investigational product with the purpose of treating a patient or a group of patients, the sponsor and treating physicians or investigators will determine suitability when all of the following criteria apply: patient(s) have a serious or immediately life-threatening disease or condition, and there is no comparable or satisfactory alternative

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therapy to diagnose, monitor, or treat the disease or condition; the potential patient benefit justifies the potential risks of the treatment and the potential risks are not unreasonable in the context or condition to be treated; and the expanded use of the investigational drug for the requested treatment will not interfere initiation, conduct, or completion of clinical investigations that could support marketing approval of the product or otherwise compromise the potential development of the product.

        On December 13, 2016,There is no obligation for a sponsor to make its drug products available for expanded access; however, as required by the 21st Century Cures Act, established (and the 2017 Food and Drug Administration Reauthorizationor Cures Act, later amended) a requirement thatpassed in 2016, sponsors of one or more investigational drugs for the treatment of a serious disease(s) or condition(s)are required to make publicly available their policypolicies for evaluating and responding to requests for expanded access for individual patients. Although these requirements were rolled out over time, they have now come into full effect. This provision requires drug and biologic companies to make publicly available their policies for expanded access for individual patient access to products intended for serious diseases. Sponsors are required to make such policiespatients publicly available upon the earlier of initiation of a Phase 2 or Phase 3 study;clinical trial, or 15 days after the investigational drug or biologic receives designation as a breakthrough therapy, fast track product, or regenerative medicine advanced therapy.

In addition, on May 30, 2018, the Right to Try Act, was signed into law. The law, among other things, provides a federal framework for certain patients to access certain investigational new drug products that have completed a Phase I1 clinical trial and that are undergoing investigation for FDA approval. Under certain circumstances, eligible patients can seek treatment without enrolling in clinical trials and without obtaining FDA permission under the FDA expanded access program. There is no obligation for a drug manufacturer to make its drug products available to eligible patients as a result of the Right to Try Act, but the manufacturer must develop an internal policy and respond to patient requests according to that policy.

Special Protocol Assessment Agreements

A Special Protocol Assessment, or SPA, agreement is an agreement between a drug manufacturer and the FDA on the design and size of studies and clinical trials that can be used for approval of a drug or biological product. The FDA'sFDA’s guidance on such agreements states that an agreement may not be changed by the manufacturer or the agency

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unless through a written agreement of the two entities or if FDA determines a substantial scientific issue essential to determining the safety or effectiveness of the drug. The protocols that are eligible for SPA agreements are: animal carcinogenicity protocols, final product stability protocols and clinical protocols for Phase 3 trials whose data will form the primary basis for an efficacy claim.

Specifically, under the FDCA, the FDA may meet with sponsors, provided certain conditions are met, for the purpose of reaching a SPA agreement on the design and size of clinical trials intended to form the primary basis of an efficacy claim in a marketing application. If a sponsor makes a reasonable written request to meet with the FDA for the purpose of reaching agreement on the design and size of a clinical trial, then the FDA will meet with the sponsor. If an agreement is reached, the FDA will reduce the agreement to writing and make it part of the administrative record. An agreement may not be changed by the sponsor or FDA after the trial begins, except with the written agreement of the sponsor and FDA, or if the director of the FDA reviewing division determines that "a“a substantial scientific issue essential to determining the safety or effectiveness of the drug"drug” was identified after the testing began. If a sponsor and the FDA meet regarding the design and size of a clinical trial and the parties cannot agree that the trial design is adequate to meet the goals of the sponsor, the FDA will clearly state the reasons for the disagreement in a letter to the sponsor. We reached agreement with

Pediatric Studies

Under the Pediatric Research Equity Act of 2003, or PREA, a marketing application or supplement thereto must contain data that are adequate to assess the safety and effectiveness of the product for the claimed indications in all relevant pediatric subpopulations, and to support dosing and administration for each pediatric subpopulation for which the product is safe and effective. Sponsors must also submit an initial Pediatric Study Plan, or PSP, within 60 days of an end-of-phase 2 meeting or as may be agreed between the sponsor and the FDA. Those plans must contain an outline of the proposed pediatric study or studies the sponsor plans to conduct, including study objectives and design, any deferral or waiver requests, and other information required by regulation. The sponsor, the FDA, and the FDA’s internal review committee must then review the information submitted, consult with each other, and agree upon a final plan. The FDA or the sponsor may request an amendment to the plan at any time.
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The FDA may, on its own initiative or at the request of the sponsor, grant deferrals for submission of some or all pediatric data until after approval of the product for use in September 2015 onadults, or full or partial waivers from the pediatric data requirements. A deferral may be granted for several reasons, including a SPA regardingfinding that the study designtherapeutic 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 law requires the FDA to send a PREA Non-Compliance letter to sponsors who have failed to submit their pediatric assessments required under PREA, have failed to seek or obtain a deferral or deferral extension or have failed to request approval for a required pediatric formulation. Unless otherwise required by regulation, the pediatric data requirements do not apply to products with orphan designation, although FDA has recently taken steps to limit what it considers abuse of our first Phase 3 clinical trialthis statutory exemption. The FDA maintains a list of lefamulin fordiseases that are exempt from PREA requirements due to low prevalence of disease in the treatment of CABP.

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Submission of an NDA to the FDA

Assuming successful completion of required clinical testing and other requirements, the results of the preclinical and clinical studies, together with detailed information relating to the product'sproduct’s chemistry, manufacture, controls and proposed labeling, among other things, are submitted to the FDA as part of an NDA requesting approval to market the drug product for one or more indications. Under federal law, the submission of most NDAs is subject to an application user fee, which for federal fiscal year 20192022 is $2,588,478$3,117,218 for an application requiring clinical data. The sponsor of an approved NDA is also subject to an annual program fee, which for fiscal year 20192022 is $309,154.$369,413. Exceptions or waivers for these fees exist for a small company (fewer than 500 employees, including employees and affiliates) satisfying certain requirements and products with orphan drug designation for a particular indication are not subject to a fee provided there are no other intended uses in the NDA.

Following submission of an NDA, the FDA conducts a preliminary review of an NDA generally within 60 calendar days of its receipt and strives tomust inform the sponsor by the 74th day after the FDA's receipt of the submissionat that time or before whether the application is sufficiently complete to permit substantive review. In the event that FDA determines that an application does not satisfy this standard, it will issue a

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Refuse to File, or RTF, determination to the sponsor. The FDA may request additional information rather than accept an NDA for filing. In this event,filing and the application mustmay be resubmitted with the additional information. The resubmitted application is also subject to review before the FDA accepts it for filing.

Once the submission is accepted for filing, the FDA begins an in-depth substantive review. The FDA has agreed to certain performance goals in the review process of NDAs. Standard review, representing most such applications are meant to be reviewed within ten months from the date of filing. Priority review applications are meant to be reviewed within six months of filing. The review process and the Prescription Drug User Fee Act goal date may be extended by the FDA for three additional months to consider new information or clarification provided by the applicantsponsor to address an outstanding deficiency identified by the FDA following the original submission. Under the FDA Reauthorization Act of 2017, the FDA must implement a protocol to expedite

In connection with its review of responses to inspection reports pertaining to certain applications, including applications for products in shortage or those for which approval is dependent on remediation of conditions identified in the inspection report.

        Before approving an NDA, the FDA typically will inspect the facility or facilities where the product is or will be manufactured. These pre-approval inspections may cover all facilities associated with an NDA submission, including drug component manufacturing (such as active pharmaceutical ingredients), finished drug product manufacturing, and control testing laboratories. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA, the FDA will typically inspect one or more clinical sites to assure compliance with GCP.GCP and the integrity of the data in support of the application.

In addition, as a condition of approval, the FDA may require an applicantthe sponsor to develop a REMS. REMS use risk minimization strategies beyond the professional labeling to ensure that the benefits of the product outweigh the potential risks. To determine whether a REMS is needed, the FDA will consider the size of the population likely to use the product, seriousness of the disease, expected benefit of the product, expected duration of treatment, seriousness of known or potential adverse events, and whether the product is a new molecular entity. REMS can include medication guides, physician communication plans for healthcare professionals, and elements to assure safe use, or ETASU. ETASU may include, but are not limited to, special training or certification for prescribing or dispensing, dispensing only under certain circumstances, special monitoring, and the use of patient registries. The FDA may require a REMS before approval or post-approval if it becomes aware of a serious risk associated with use of the product. The requirement for a REMS can materially affect the potential market and profitability of a product.

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The FDA may refer an application for a novel drug to an advisory committee or explain why such referral was not made. Typically, an advisory committee is a panel of independent experts, including clinicians and other scientific experts, that reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions relating to approval of a new drug product.

Fast Track, Breakthrough Therapy, PriorityExpedited Review and Regenerative Advanced Therapy DesignationsPrograms

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The FDA is authorized to expedite the review of NDAs in several ways. Under the Fast Track program, the sponsor of a product candidate may request the FDA to designate certainthe product for a specific indication as a Fast Track product concurrent with or after the filing of the IND. Candidate products are eligible for expedited reviewFast Track designation if they are intended to address an unmet medical need in the treatment oftreat a serious or life-threatening disease or condition. These programs are referred to as fast track designation, breakthrough therapy designation, priority review designation and regenerative advanced therapy designation.

        Specifically, the FDA may designate a product for Fast Track review if it is intended, whether alone or in combination with one or more other products, for the treatment of a serious or life-threatening disease or condition and it demonstratesdemonstrate the potential to address unmet medical needs for such a disease orthe condition. For Fast Track products, sponsors maydesignation applies to the combination of the product candidate and the specific indication for which it is being studied. In addition to other benefits, such as the ability to have greater interactions with the FDA, and the FDA may initiate review of sections of a Fast Track product's application before the application is complete. Thiscomplete, a process known as rolling review may be available ifreview.

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Any product candidate submitted to the FDA determines, after preliminary evaluation of clinical data submitted by the sponsor, thatfor marketing, including under a Fast Track productprogram, may be effective. The sponsor must also provide, and the FDA must approve, a schedule for the submission of the remaining information and the sponsor must pay applicable user fees. However, the FDA's time period goal for reviewing a Fast Track application does not begin until the last section of the application is submitted. In addition, the Fast Track designation may be withdrawn by the FDA if the FDA believes that the designation is no longer supported by data emerging in the clinical trial process.

        Second, a product may be designated as a Breakthrough Therapy if it is intended, either alone or in combination with one or more other products, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the product may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. The FDA may take certain actions with respect to Breakthrough Therapies, including holding meetings with the sponsor throughout the development process; providing timely advice to the product sponsor regarding development and approval; involving more senior staff in the review process; assigning a cross-disciplinary project lead for the review team; and taking other steps to design the clinical trials in an efficient manner.

        Third, the FDA may designate a product for priority review if it is a product that treats a serious condition and, if approved, would provide a significant improvement in safety or effectiveness. The FDA determines, on a case- by-case basis, whether the proposed product represents a significant improvement when compared with other available therapies. Significant improvement may be illustrated by evidence of increased effectiveness in the treatment of a condition, elimination or substantial reduction of a treatment-limiting product reaction, documented enhancement of patient compliance that may lead to improvement in serious outcomes, and evidence of safety and effectiveness in a new subpopulation. A priority designation is intended to direct overall attention and resources to the evaluation of such applications, and to shorten the FDA's goal for taking action on a marketing application from ten months to six months.

        With passage of the 21st Century Cures Act, or the Cures Act, in December 2016, Congress authorized the FDA to accelerate review and approval of products designated as regenerative advanced therapies. A product is eligible for this designation if it is a regenerative medicine therapy that isother types of FDA programs intended to treat, modify, reverse or cure a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the product has the potential to address unmet medical

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needs for such disease or condition. The benefits of a regenerative advanced therapy designation include early interactions with FDA to expedite development and review, benefits available tosuch as breakthrough therapies, potential eligibility fortherapy designation, priority review and accelerated approval based on surrogate or intermediate endpoints.approval.

Accelerated Approval Pathway​

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None of alternative treatments. Drugs granted accelerated approval must meetthese expedited programs change the same statutory standards for safety and effectiveness as those granted traditional approval.

        For the purposes of accelerated approval a surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign, or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit. Surrogate endpoints can often be measured more easily or more rapidly than clinical endpoints. An intermediate clinical endpoint is a measurement of a therapeutic effect that is considered reasonably likely to predict the clinical benefit of a drug, such as an effect on IMM. The FDA has limited experience with accelerated approvals based on intermediate clinical endpoints, but has indicated that such endpoints generallythey may support accelerated approval where the therapeutic effect measured by the endpoint is not itself a clinical benefit and basis for traditional approval, if there is a basis for concluding that the therapeutic effect is reasonably likely to predict the ultimate clinical benefit of a drug.

        The accelerated approval pathway is most often used in settings in which the course of a disease is long and an extended period of time is required to measure the intended clinical benefit of a drug, even if the effect on the surrogate or intermediate clinical endpoint occurs rapidly. Thus, accelerated approval has been used extensively inhelp expedite the development andor approval process of drugs for treatment of a variety of cancers in which the goal of therapy is generally to improve survival or decrease morbidity and the duration of the typical disease course requires lengthy and sometimes large trials to demonstrate a clinical or survival benefit. The accelerated approval pathway is usually contingent on a sponsor's agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to verify and describe the drug's clinical benefit. As a result, a drug candidate approved on this basis is subject to rigorous post-marketing compliance requirements, including the completion of Phase 4 or post-approval clinical trials to confirm the effect on the clinical endpoint. Failure to conduct required post-approval studies, or confirm a clinical benefit during post-marketing studies, would allow the FDA to withdraw the drug from the market on an expedited basis. All promotional materials for drug candidates approved under accelerated regulations are subject to prior review by the FDA.product candidates.

Limited Population Antibacterial Drug Pathway

With passage of the CURES Act, Congress authorized FDA to approve an antibacterial or antifungal drug, alone or in combination with one or more other drugs, as a "limited“limited population drug."drug”. To qualify for this approval pathway, the drug must be intended to treat a serious or life-threatening infection in a limited population of patients with unmet needs; the standards for approval of drugs and biologics under the FDCA and PHSA must be satisfied; and FDA must receive a written request from the sponsor to approve the drug as a limited population drug pursuant to this provision. The FDA'sFDA’s determination of safety and effectiveness for such a product must reflect the benefit-risk profile of such

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drug in the intended limited population, taking into account the severity, rarity, or prevalence of the infection the drug is intended to treat and the availability or lack of alternative treatment in such a limited population.

Any drug or biologic approved under this pathway must be labeled with the statement "Limited Population"“Limited Population” in a prominent manner and adjacent to the proprietary name of the drug or biological product. The prescribing information must also state that the drug is indicated for use in a limited and specific population of patients and copies of all promotional materials relating to the drug must be submitted to FDA at least 30 days prior to dissemination of the materials. If FDA subsequently approves the drug for a broader indication, the agency may remove any post-marketing conditions, including requirements with respect to labeling and review of promotional materials applicable to the

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product. Nothing in this pathway to approval of a limited population drug prevents sponsors of such products from seeking designation or approval under other provisions of the FDCA, such as accelerated approval.

The FDA'sFDA’s Decision on an NDA

The FDA reviews an application to determine, among other things, whether the product is safe and whether it is effective for its intended use(s), with the latter determination being made on the basis of substantial evidence. The FDA has interpreted this evidentiary standard to require at least two adequate and well-controlled clinical investigations to establish effectiveness of a new product. Under certain circumstances, however, the FDA has indicated that a single trial with certain characteristics and additional information may satisfy this standard. Ultimately, the FDA will determine whether the expected benefits of the drug product outweigh its potential risks to patients.

On the basis of the FDA'sFDA’s evaluation of the NDA and accompanying information, including the results of the inspection of the manufacturing facilities, the FDA may issue an approval letter or a complete response letter, or CRL, or an approval letter. An approval letter authorizes commercial marketing of the product with specific prescribing information for specific indications. A complete response letterCRL generally outlines the deficiencies in the submission and may require additional, sometimes substantial, testing or information in order for the FDA to reconsider the application. If and when those deficiencies have been addressed to the FDA'sFDA’s satisfaction in a resubmission of the NDA, the FDA will issue an approval letter. The FDA has committed to reviewing such resubmissions in two or six months depending on the type of information included. Even with submission of this additional information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval.

        IfAn approval letter, on the other hand, authorizes commercial marketing of the product with specific prescribing information for specific indications. The FDA approves a new product, it may limit the approved indications for use for the product, require that contraindications, warnings or precautions be included in the product labeling, require that post-approval studies, including Phase 4 clinical trials, be conducted to further assess the drug'sdrug’s safety after approval, require testing and surveillance programs to monitor the product after commercialization, or impose other conditions, including distribution restrictions or other risk management mechanisms, including REMS, which can materially affect the potential market and profitability of the product. The FDA may prevent or limit further marketing of a product based on the results of post-market studies or surveillance programs. After approval, many types of changes to the approved product, such as adding new indications, manufacturing changes and additional labeling claims, are subject to further testing requirements and FDA review and approval.

Post-Approval Regulation

Drugs manufactured or distributed pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to recordkeeping, periodic reporting, product sampling and distribution, advertising and promotion and reporting of adverse experiences with the product. After approval, most changes to the approved product, such as adding new indications or other labeling claims, are subject to prior FDA review and approval. There also are continuing, annual user fee requirements for any marketed products and the establishments at which such products are manufactured, as well as new application fees for supplemental applications with or without clinical data.

In addition, drug manufacturers and other entities involved in the manufacture and distribution of approved drugs are required to register their establishments with the FDA and state agencies, and are subject to periodic unannounced inspections by the FDA and these state agencies for compliance with

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cGMP requirements. Changes to the manufacturing process are strictly regulated and often require prior FDA approval before being implemented. FDA regulations also require investigation and correction of any deviations from cGMP and impose reporting and documentation requirements upon the sponsor and any third-party manufacturers that the sponsor may decide to use. Accordingly, manufacturers must continue to expend time, money and effort in the area of production and quality control to maintain cGMP compliance.

Once an approval is granted, the FDA may withdraw the approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market. Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with

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manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical trials to assess new safety risks; or imposition of distribution or other restrictions under a REMS program. Other potential consequences include, among other things:

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restrictions on the marketing or manufacturing of the product, suspension of the approval, or complete withdrawal of the product from the market or product recalls;



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fines, warning letters or holds on post-approval clinical trials;



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refusal of the FDA to approve pending NDAs or supplements to approved NDAs, or suspension or revocation of product license approvals;



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product seizure or detention, or refusal to permit the import or export of products; or



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injunctions or the imposition of civil or criminal penalties.

The FDA strictly regulates the marketing, labeling, advertising and promotion of prescription drug products placed on the market. This regulation includes, among other things, standards and regulations for direct-to-consumer advertising, communications regarding unapproved uses, industry-sponsored scientific and educational activities, and promotional activities involving the Internet and social media. Promotional claims about a drug'sdrug’s safety or effectiveness are prohibited before the drug is approved. After approval, a drug product generally may not be promoted for uses that are not approved by the FDA, as reflected in the product'sproduct’s prescribing information. In the United States, health care professionals are generally permitted to prescribe drugs for such uses not described in the drug'sdrug’s labeling, known as off-label uses, because the FDA does not regulate the practice of medicine. However, FDA regulations impose rigorous restrictions on manufacturers'manufacturers’ communications and prohibit the promotion of off-label uses. It may be permissible, under very specific, narrow conditions, for a manufacturer to engage in non-promotional, non-misleading communication regarding off-label information, such as distributing scientific or medical journal information. 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.

If a company is found to have promoted off-label uses, it may become subject to adverse public relations and administrative and judicial enforcement by the FDA, the Department of Justice, or the Office of the Inspector General of the Department of Health and Human Services, as well as state authorities. This could subject a company to a range of penalties that could have a significant commercial impact, including civil and criminal fines and agreements that materially restrict the manner in which a company promotes or distributes drug products. The federal government has levied large civil and criminal fines against companies for alleged improper promotion, and has also requested that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed.

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In addition, the distribution of prescription pharmaceutical products is subject to the Prescription Drug Marketing Act, or PDMA, and its implementing regulations, as well as the Drug Supply Chain Security Act, or DSCA, which regulate the distribution and tracing of prescription drug samples at the federal level, and set minimum standards for the regulation of drug distributors by the states. The PDMA, its implementing regulations and state laws limit the distribution of prescription pharmaceutical product samples and the DSCA imposes requirements to ensure accountability in distribution and to identify and remove counterfeit and other illegitimate products from the market.

Section 505(b)(2) NDAs

NDAs for most new drug products are based on two full clinical studies which must contain substantial evidence of the safety and efficacy of the proposed new product for the proposed use. These applications are submitted under Section 505(b)(1) of the FDCA. The FDA is, however, authorized to approve an alternative type of NDA under Section 505(b)(2) of the FDCA. This type of application allows the applicantsponsor to rely, in part, on the FDA'sFDA’s previous findings of safety and efficacy for a similar product, or published literature. Specifically, Section 505(b)(2) applies to

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NDAs for a drug for which the investigations made to show whether or not the drug is safe for use and effective in use and relied upon by the applicantsponsor for approval of the application "were“were not conducted by or for the applicantsponsor and for which the applicantsponsor has not obtained a right of reference or use from the person by or for whom the investigations were conducted."conducted”.

Thus, Section 505(b)(2) authorizes the FDA to approve an NDA based on safety and effectiveness data that were not developed by the applicant. NDAs filed under Section 505(b)(2) may provide an alternate and potentially more expeditious pathway to FDA approval for new or improved formulations or new uses of previously approved products. If the Section 505(b)(2) applicant can establish that reliance on the FDA'sFDA’s previous approval is scientifically appropriate, the applicant may eliminate the need to conduct certain preclinical or clinical studies of the new product. The FDA may also require companies to perform additional studies or measurements to support the change from the approved product. The FDA may then approve the new drug candidate for all or some of the label indications for which the referenced product has been approved, as well as for any new indication sought by the Section 505(b)(2) applicant.

Abbreviated New Drug Applications for Generic Drugs

In 1984, with passage of the Hatch-Waxman Amendments to the FDCA, Congress authorized the FDA to approve generic drugs that are the same as drugs previously approved by the FDA under the NDA provisions of the statute. To obtain approval of a generic drug, an applicanta sponsor must submit an abbreviated new drug application, or ANDA, to the agency. In support of such applications, a generic manufacturer may rely on the preclinical and clinical testing previously conducted for a drug product previously approved under an NDA, known as the reference listed drug, or RLD.

Specifically, in order for an ANDA to be approved, the FDA must find that the generic version is identical to the RLD with respect to the active ingredients, the route of administration, the dosage form, and the strength of the drug. At the same time, the FDA must also determine that the generic drug is "bioequivalent"“bioequivalent” to the innovator drug. Under the statute, a generic drug is bioequivalent to a RLD if "the“the rate and extent of absorption of the drug do not show a significant difference from the rate and extent of absorption of the listed drug."drug”.

Upon approval of an ANDA, the FDA indicates whether the generic product is "therapeutically equivalent"“therapeutically equivalent” to the RLD in its publication "Approved“Approved Drug Products with Therapeutic Equivalence Evaluations,"Evaluations”, also referred to as the "Orange Book."“Orange Book”. Physicians and pharmacists consider a therapeutic equivalent generic drug to be fully substitutable for the RLD. In addition, by operation of certain state laws and numerous health insurance programs, the FDA'sFDA’s designation of therapeutic equivalence often

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results in substitution of the generic drug without the knowledge or consent of either the prescribing physician or patient.

Under the Hatch-Waxman Amendments, the FDA may not approve an ANDA until any applicable period of non-patent exclusivity for the RLD has expired. The FDCA provides a period of five years of non-patent data exclusivity for a new drug containing a new chemical entity. For the purposes of this provision, a new chemical entity, or NCE, is a drug that contains no active moiety that has previously been approved by the FDA in any other NDA. This interpretation of the FDCA by the FDA was confirmed with enactment of the Ensuring Innovation Act in April 2021. An active moiety is the molecule or ion responsible for the physiological or pharmacological action of the drug substance. In cases where such exclusivity has been granted, an ANDA may not be filed with the FDA until the expiration of five years unless the submission is accompanied by a Paragraph IV certification, in which case the applicant may submit its application four years following the original product approval. The FDCA also provides for a period of three years of exclusivity if the NDA includes reports of one or more new clinical investigations, other than bioavailability or bioequivalence studies, that were conducted by or for the applicant and are essential to the approval of the application. This three-year exclusivity period often protects changes to a previously approved drug product, such as a new dosage form, route of administration, combination or indication.

The FDCA also provides for a period of three years of exclusivity if the NDA includes reports of one or more new clinical investigations, other than bioavailability or bioequivalence studies, that were conducted by or for the applicant and are essential to the approval of the application. This three-year exclusivity period often protects changes to a previously approved drug product, such as a new dosage form, route of administration, combination or indication. Three-year exclusivity would be available for a drug product that contains a previously approved active moiety, provided the statutory requirement for a new clinical investigation is satisfied. Unlike five-year NCE exclusivity, an award of three-year exclusivity does not block the FDA from accepting ANDAs seeking approval for generic versions of the drug

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as of the date of approval of the original drug product. The FDA typically makes decisions about awards of data exclusivity shortly before a product is approved.

        The FDA must establish a priority review track for certain generic drugs, requiring the FDA to review a drug application within eight (8) months for a drug that has three (3) or fewer approved drugs listed in the Orange Book and is no longer protected by any patent or regulatory exclusivities, or is on the FDA's drug shortage list. The new legislation also authorizes FDA to expedite review of "competitor generic therapies" or drugs with inadequate generic competition, including holding meetings with or providing advice to the drug sponsor prior to submission of the application.

Hatch-Waxman Patent Certification and the 30-Month Stay

Upon approval of an NDA or a supplement thereto, NDA sponsors are required to list with the FDA each patent with claims that cover the applicant'sapplicant’s product or an approved method of using the product. Each of the patents listed by the NDA sponsor is published in the Orange Book. The FDA’s regulations governing patient listings were largely codified into law with enactment of the Orange Book Modernization Act in January 2021. When an ANDA applicant files its application with the FDA, the applicant is required to certify to the FDA concerning any patents listed for the reference product in the Orange Book, except for patents covering methods of use for which the ANDA applicant is not seeking approval. To the extent that the Section 505(b)(2) applicant is relying on studies conducted for an already approved product, the applicant is required to certify to the FDA concerning any patents listed for the approved product in the Orange Book to the same extent that an ANDA applicant would.

Specifically, the applicant must certify with respect to each patent that:

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the required patent information has not been filed;



•

the listed patent has expired;

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•

the listed patent has not expired, but will expire on a particular date and approval is sought after patent expiration; or



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the listed patent is invalid, unenforceable or will not be infringed by the new product.

A certification that the new product will not infringe the already approved product'sproduct’s listed patents or that such patents are invalid or unenforceable is called a Paragraph IV certification. If the applicant does not challenge the listed patents or indicates that it is not seeking approval of a patented method of use, the ANDA application will not be approved until all the listed patents claiming the referenced product have expired (other than method of use patents involving indications for which the ANDA applicant is not seeking approval).

If the ANDA applicant has provided a Paragraph IV certification to the FDA, the applicant must also send notice of the Paragraph IV certification to the NDA and patent holders once the ANDA has been accepted for filing by the FDA. The NDA and patent holders may then initiate a patent infringement lawsuit in response to the notice of the Paragraph IV certification. The filing of a patent infringement lawsuit within 45 days after the receipt of a Paragraph IV certification automatically prevents the FDA from approving the ANDA until the earlier of 30 months after the receipt of the Paragraph IV notice, expiration of the patent, or a decision in the infringement case that is favorable to the ANDA applicant.

To the extent that the Section 505(b)(2) applicant is relying on studies conducted for an already approved product, the applicant is required to certify to the FDA concerning any patents listed for the approved product in the Orange Book to the same extent that an ANDA applicant would. As a result, approval of a Section 505(b)(2) NDA can be stalled until all the listed patents claiming the referenced product have expired, until any non-patent exclusivity, such as exclusivity for obtaining approval of a new chemical entity, listed in the Orange Book for the referenced product has expired, and, in the case of a Paragraph IV certification and subsequent patent infringement suit, until the earlier of 30 months, settlement of the lawsuit or a decision in the infringement case that is favorable to the Section 505(b)(2) applicant.

Pediatric Studies and Exclusivity

Pediatric exclusivity is anothera type of non-patent marketing exclusivity in the United States and, if granted, provides for the attachment of an additional six months of marketing protectionregulatory exclusivity to the term of any existing patent or non-patent

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regulatory exclusivity, including the non-patent and orphan exclusivity.exclusivity, for a drug product. 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. The data dodoes 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'sFDA’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.

GAIN Exclusivity for Antibiotics

In 2012, Congress passed legislation known as the Generating Antibiotic Incentives Now Act, or GAIN Act. This legislation is designed to encourage the development of antibacterial and antifungal drug products that treat pathogens that cause serious and life-threatening infections. To that end, the law grants an additional five years of exclusivity upon the approval of an NDA for a drug product designated by FDA as a QIDP. Thus, for a QIDP, the periods of five-year new chemical entity exclusivity, three-year new clinical investigation exclusivity, and seven-year orphan drug exclusivity, would become ten years, eight years, and twelve years, respectively.

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A QIDP is defined in the GAIN Act to mean "an“an antibacterial or antifungal drug for human use intended to treat serious or life-threatening infections, including those caused by (1) an antibacterial or antifungal resistant pathogen, including novel or emerging infectious pathogens"pathogens” or (2) certain "qualifying pathogens."“qualifying pathogens”. A "qualifying pathogen"“qualifying pathogen” is a pathogen that has the potential to pose a serious threat to public health (such as resistant Gram-positive pathogens, multi-drug resistant Gram-negative bacteria, multi-drug resistant tuberculosis, andC.Clostridium difficile) and that is included in a list established and maintained by FDA. A drug sponsor may request the FDA to designate its product as a QIDP any time before the submission of an NDA. The FDA must make a QIDP determination within 60 days of the designation request. A product designated as a QIDP will be granted priority review by the FDA and can qualify for "fast track"“fast track” status.

The additional five years of exclusivity under the GAIN Act for drug products designated by the FDA as QIDPs applies only to a drug that is first approved on or after July 9, 2012. Additionally, the five year exclusivity extension does not apply to: a supplement to an application under FDCA Section 505(b) for any QIDP for which an extension is in effect or has expired; a subsequent application filed with respect to a product approved by the FDA for a change that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device or strength; or a product that does not meet the definition of a QIDP under Section 505(g) based upon its approved uses. The FDA has designated IV fosfomycin, and each of the IV and oral formulations of lefamulinXENLETA as a QIDP and also granted fast track designations.

Patent Term Restoration and Extension

A patent claiming a new drug product may be eligible for a limited patent term extension under the Hatch-Waxman Act, which permits a patent restoration of up to five years for patent term lost during product development and the FDA regulatory review. The restoration period granted on a patent covering a product is typically one-half the time between the effective date of a clinical investigation involving human beings is begunthe IND and the submission date of an application, plus the time between the submission date of an application and the ultimate approval date. Patent term restoration cannot be used to extend the remaining term of a patent past a total of 14 years from the product'sproduct’s approval date. Only one patent applicable to an approved drug product is eligible for the extension, and the application for the extension must be submitted prior to the expiration of the patent in question. A patent that covers multiple products for which approval is sought can only be extended in connection with one of the approvals. The United States Patent and Trademark Offices reviews and approves the application for any patent term extension or restoration in consultation with the FDA.

Regulation Outside the United States

In order to market any product outside of the United States, a company must also comply with numerous and varying regulatory requirements of other countries and jurisdictions regarding quality, safety and efficacy and governing, among other things, clinical trials, marketing authorization, commercial sales and distribution of drug products. Whether or not we obtain

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Although FDA approval for lefamulin, the company would needXENLETA has been obtained, we are required to obtain the necessary approvals by the comparable foreign regulatory authorities before itwe can commence clinical trials or marketing of the product in those countries or jurisdictions. The approval process ultimately varies between countries and jurisdictions and can involve additional product testing and additional administrative review periods. 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.

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Regulation and Marketing Authorization in the European Union

The process governing approval of medicinal products in the European Union follows essentially the same lines as in the United States and, likewise, generally involves satisfactorily completing each of the following:

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preclinical laboratory tests, animal studies and formulation studies all performed in accordance with the applicable E.U. Good Laboratory Practice regulations;



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submission to the relevant national authorities of a clinical trial application, or CTA, which must be approved before human clinical trials may begin;



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performance of adequate and well-controlled clinical trials to establish the safety and efficacy of the product for each proposed indication;



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submission to the relevant competent authorities of a marketing authorization application, or MAA, which includes the data supporting safety and efficacy as well as detailed information on the manufacture and composition of the product in clinical development and proposed labelling;



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satisfactory completion of an inspection by the relevant national authorities of the manufacturing facility or facilities, including those of third parties, at which the product is produced to assess compliance with strictly enforced cGMP;



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potential audits of the non-clinical and clinical trial sites that generated the data in support of the MAA; and



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review and approval by the relevant competent authority of the MAA before any commercial marketing, sale or shipment of the product.

Preclinical Studies

Preclinical tests include laboratory evaluations of product chemistry, formulation and stability, as well as studies to evaluate toxicity in animal studies, in order to assess the potential safety and efficacy of the product. The conduct of the preclinical tests and formulation of the compounds for testing must comply with the relevant E.U. regulations and requirements. The results of the preclinical tests, together with relevant manufacturing information and analytical data, are submitted as part of the CTA.

Clinical Trial Approval

Requirements for the conduct of clinical trials in the European Union including Good Clinical Practice, or GCP, are set forth in the Clinical Trials Directive 2001/20/EC and the GCP Directive 2005/28/EC. Pursuant to Directive 2001/20/EC and Directive 2005/28/EC, as amended, a system for the approval of clinical trials in the European Union has been implemented through national legislation of the E.U. member states. Under this system, approval must be obtained from the competent national authority of each E.U. member state in which a study is planned to be conducted. To this end, a CTA is submitted, which must be supported by an investigational medicinal product dossier, or IMPD, and further supporting information prescribed by Directive 2001/20/EC and Directive 2005/28/EC and other

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applicable guidance documents. Furthermore, a clinical trial may only be started after a competent ethics committee has issued a favorable opinion on the clinical trial application in that country.

        In April 2014, the E.U. passed On January 31, 2022, the new Clinical Trials Regulation (EU) No 536/2014 which will replace the current Clinical Trials Directive 2001/20/EC. The Regulation was published on June 16, 2014 but is not expected to apply until later in 2019. To ensure that the rules for clinical trials are identical throughout the European Union, the new E.U. clinical trials legislation was passed as a

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regulation that is directly applicable in all E.U. member states. All clinical trials performed in the European Union are required to be conducted in accordance with the Clinical Trials Directive 2001/20/EC until the new Clinical Trials Regulation (EU) No 536/2014 becomes applicable. The Clinical Trials Directive 2001/20/EC will, however, still apply three years from the date of entry into application of the Clinical Trials Regulation to (i) clinical trials applications submitted before the entry into application and (ii) clinical trials applications submitted within one year after the entry into application if the sponsor opts for the old system.

The new Clinical Trials Regulation aims to simplify and streamline the approval of clinical trial in the European Union. The main characteristics of the regulation include:

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a streamlined application procedure via a single entry point, the E.U. portal;



•

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a streamlined application procedure via a single entry point, the E.U. portal;

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a single set of documents to be prepared and submitted for the application as well as simplified reporting procedures that will spare sponsors from submitting broadly identical information separately to various bodies and different member states;

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a harmonized procedure for the assessment of applications for clinical trials, which is divided in two parts. Part I is assessed jointly by all member states concerned. Part II is assessed separately by each member state concerned;

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strictly defined deadlines for the assessment of clinical trial applications; and

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the involvement of the ethics committees in the assessment procedure in accordance with the national law of the member state concerned but within the overall timelines defined by the Clinical Trials Regulation.

The new regulation did not change the preexisting requirement that a sponsor must obtain prior approval from the competent national authority of the EU Member State in which the clinical trial is to be prepared and submittedconducted. If the clinical trial is conducted in different EU Member States, the competent authorities in each of these EU Member States must provide their approval for the application as well as simplified reporting procedures that will spare sponsors from submitting broadly identical information separately to various bodies and different member states;



•

a harmonized procedure forconduct of the assessment of applications for clinical trials, which is divided in two parts. Part I is assessed jointly by all member states concerned. Part II is assessed separately by each member state concerned;



•

strictly defined deadlines fortrial. Furthermore, the assessment ofsponsor may only start a clinical trial applications; and



•

at a specific study site after the involvement of theapplicable ethics committeescommittee has issued a favorable opinion.

As in the assessment procedureUnited States, similar requirements for posting clinical trial information are present in accordance with the national law of the member state concerned but within the overall timelines defined by the Clinical Trials Regulation.

Marketing Authorization

Authorization to market a product in the member states of the European Union proceeds under one of four procedures: a centralized authorization procedure, a mutual recognition procedure, a decentralized procedure or a national procedure.

Centralized Authorization Procedure

The centralized procedure enables applicantssponsors to obtain a marketing authorization that is valid in all E.U. member states based on a single application. Certain medicinal products, including products developed by means of biotechnological processes must undergo the centralized authorization procedure for marketing authorization, which, if granted by the European Commission, is automatically valid in all 28 E.U. member states. The EMA and the European Commission administer this centralized authorization procedure pursuant to Regulation (EC) No 726/2004.

Pursuant to Regulation (EC) No 726/2004, this procedure is mandatory for:

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medicinal products developed by means of one of the following biotechnological processes:



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recombinant DNA technology;



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controlled expression of genes coding for biologically active proteins in prokaryotes and eukaryotes including transformed mammalian cells; and



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hybridoma and monoclonal antibody methods;



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advanced therapy medicinal products as defined in Article 2 of Regulation (EC) No 1394/2007 on advanced therapy medicinal products;

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medicinal products for human use containing a new active substance that, on the date of effectiveness of this regulation, was not authorized in the European Union, and for which the therapeutic indication is the treatment of any of the following diseases:



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acquired immune deficiency syndrome;



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cancer;



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neurodegenerative disorder;



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diabetes;



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auto-immune diseases and other immune dysfunctions; and



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viral diseases; and



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medicinal products that are designated as orphan medicinal products pursuant to Regulation (EC) No 141/2000.

The centralized authorization procedure is optional for other medicinal products if they contain a new active substance or if the applicantsponsor shows that the medicinal product concerned constitutes a significant therapeutic, scientific or technical innovation or that the granting of authorization is in the interest of patients in the European Union.

Administrative Procedure

Under the centralized authorization procedure, the EMA'sEMA’s Committee for Medicinal Products for Human Use, or CHMP serves as the scientific committee that renders opinions about the safety, efficacy and quality of medicinal products for human use on behalf of the EMA. The CHMP is composed of experts nominated by each member state'sstate’s national authority for medicinal products, with one of them appointed to act as Rapporteur for the co-ordination of the evaluation with the possible assistance of a further member of the Committee acting as a Co-Rapporteur. After approval, the Rapporteur(s) continue to monitor the product throughout its life cycle. The CHMP has 210 days, to adopt an opinion as to whether a marketing authorization should be granted. The process usually takes longer in case additional information is requested, which triggers clock-stops in the procedural timelines. The process is complex and involves extensive consultation with the regulatory authorities of member states and a number of experts. When an application is submitted for a marketing authorization in respect of a drug that is of major interest from the point of view of public health and in particular from the viewpoint of therapeutic innovation, the applicantsponsor may pursuant to Article 14(9) Regulation (EC) No 726/2004 request an accelerated assessment procedure. If the CHMP accepts such request, the time-limit of 210 days will be reduced to 150 days but it is possible that the CHMP can revert to the standard time-limit for the centralized procedure if it considers that it is no longer appropriate to conduct an accelerated assessment. Once the procedure is completed, a European Public Assessment Report, or EPAR, is produced. If the opinion is negative, information is given as to the grounds on which this conclusion was reached. After the adoption of the CHMP opinion, a decision on the MAA must be adopted by the European Commission, after consulting the E.U. member states, which in total can take more than 60 days.

Conditional Approval

In specific circumstances, E.U. legislation (Regulation (EC) No 726/2004 and Regulation (EC) No 507/2006 on Conditional Marketing Authorizations for Medicinal Products for Human Use) enables applicantssponsors to obtain a conditional

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marketing authorization prior to obtaining the comprehensive clinical data required for an application for a full marketing authorization. Such conditional approvals may be granted for product candidates (including medicines designated as orphan medicinal products), if (1) the risk-benefit balance of the product candidate is positive, (2) it is likely that the applicantsponsor will be

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in a position to provide the required comprehensive clinical trial data, (3) the product fulfills unmet medical needs and (4) the benefit to public health of the immediate availability on the market of the medicinal product concerned outweighs the risk inherent in the fact that additional data are still required. A conditional marketing authorization may contain specific obligations to be fulfilled by the marketing authorization holder, including obligations with respect to the completion of ongoing or new studies, and with respect to the collection of pharmacovigilance data. Conditional marketing authorizations are valid for one year, and may be renewed annually, if the risk-benefit balance remains positive, and after an assessment of the need for additional or modified conditions and/or specific obligations. The timelines for the centralized procedure described above also apply with respect to the review by the CHMP of applications for a conditional marketing authorization.

Marketing Authorization Under Exceptional Circumstances

Under Regulation (EC) No 726/2004, products for which the applicantsponsor can demonstrate that comprehensive data (in line with the requirements laid down in Annex I of Directive 2001/83/EC, as amended) cannot be provided (due to specific reasons foreseen in the legislation) might be eligible for marketing authorization under exceptional circumstances. This type of authorization is reviewed annually to reassess the risk-benefit balance. The fulfillment of any specific procedures/obligations imposed as part of the marketing authorization under exceptional circumstances is aimed at the provision of information on the safe and effective use of the product and will normally not lead to the completion of a full dossier/approval.

Market Authorizations Granted by Authorities of E.U. Member States

In general, if the centralized procedure is not followed, there are three alternative procedures to obtain a marketing authorization in (one or several) E.U. member states as prescribed in Directive 2001/83/EC:

•

The decentralized procedure allows applicants to file identical applications to several E.U. member states and receive simultaneous national approvals based on the recognition by E.U. member states of an assessment by a reference member state.



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The national procedure is only available for products intended to be authorized in a single E.U. member state.



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A mutual recognition procedure similar to the decentralized procedure is available when a marketing authorization has already been obtained in at least one E.U. member state.

A marketing authorization may be granted only to an applicanta sponsor established in the European Union.

Pediatric Studies

Prior to obtaining a marketing authorization in the E.U., applicantssponsors have to demonstrate compliance with all measures included in an EMA-approved Pediatric Investigation Plan, or PIP, covering all subsets of the pediatric population, unless the EMA has granted a product-specific waiver, a class waiver, or a deferral for one or more of the measures included in the PIP. The respective requirements for all marketing authorization procedures are set forth in Regulation (EC) No 1901/2006, which is referred to as the Pediatric Regulation. This requirement also applies when a company wants to add a new indication, pharmaceutical form or route of administration for a medicine that is already authorized. The Pediatric Committee of the EMA, or PDCO, may grant deferrals for some medicines, allowing a company to delay development of the medicine in children until there is enough information to demonstrate its effectiveness and safety in adults. The PDCO may also grant

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waivers when development of a medicine in children is not needed or is not appropriate, such as for diseases that only affect the elderly population.

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Before a marketing authorization application can be filed, or an existing marketing authorization can be amended, the EMA determines that companies actually comply with the agreed studies and measures listed in each relevant PIP.

Period of Authorization and Renewals

A marketing authorization, other than a conditional marketing authorization, is initially valid for five years and the marketing authorization may be renewed after five years on the basis of a re-evaluation of the risk-benefit balance by the EMA or by the competent authority of the authorizing member state. To this end, the marketing authorization holder must provide the EMA or the competent authority with a consolidated version of the file in respect of quality, safety and efficacy, including all variations introduced since the marketing authorization was granted, at least six months before the marketing authorization ceases to be valid. Once renewed, the marketing authorization is valid for an unlimited period, unless the European Commission or the competent authority decides, on justified grounds relating to pharmacovigilance, to proceed with one additional five-year renewal. Any authorization which is not followed by the actual placing of the drug on the E.U. market (in case of centralized procedure) or on the market of the authorizing member state within three years after authorization ceases to be valid (the so-called sunset clause).

Regulatory Data Protection

European Union legislation also provides for a system of regulatory data and market exclusivity. According to Article 14(11) of Regulation (EC) No 726/2004, as amended, and Article 10(1) of Directive 2001/83/EC, as amended, upon receiving marketing authorization, new chemical entities approved on the basis of complete independent data package benefit from eight years of data exclusivity and an additional two years of market exclusivity. Data exclusivity prevents regulatory authorities in the European Union from referencing the innovator'sinnovator’s data to assess a generic (abbreviated) application. During the additional two-year period of market exclusivity, a generic marketing authorization application can be submitted, and the innovator'sinnovator’s data may be referenced, but no generic medicinal product can be marketed until the expiration of the market exclusivity. The overall ten-year period will be extended to a maximum of eleven years if, during the first eight years of those ten years, the marketing authorization holder, or MAH, 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. Even if a compound is considered to be a new chemical entity and the innovator is able to gain the period of data exclusivity, another company nevertheless could also market another version of the drug if such company obtained marketing authorization based on an MAA with a complete independent data package of pharmaceutical test, preclinical tests and clinical trials.

Transparency

There is an increasing trend in the E.U. towards greater transparency and, while the manufacturing or quality information in marketing authorization dossiers is currently generally protected as confidential information, the EMA and national regulatory authorities are now liable to disclose much of the non-clinical and clinical information, including the full clinical study reports, in response to freedom of information requests after the marketing authorization has been granted. In October 2014, the EMA adopted a policy under which clinical study reports would be posted on the agency'sagency’s website following the grant, denial or withdrawal of a marketing authorization application, subject to procedures for limited redactions and protection against unfair commercial use. Additional

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transparency provisions are contained in the new Clinical Trials Regulation (EU) No 536/2014 that will take effect in May 2016 at the earliest.2014.

Regulatory Requirements After a Marketing Authorization has been Obtained

If we obtain authorization for a medicinal product in the European Union, we will be required to comply with a range of requirements applicable to the manufacturing, marketing, promotion and sale of medicinal products:

Pharmacovigilance and Other Requirements

We will, for example, have to comply with the E.U.'s’s stringent pharmacovigilance or safety reporting rules, pursuant to which post-authorization studies and additional monitoring obligations can be imposed. E.U. regulators may

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conduct inspections to verify our compliance with applicable requirements, and we will have to continue to expend time, money and effort to remain compliant. Non-compliance with E.U. requirements regarding safety monitoring or pharmacovigilance, and with requirements related to the development of products for the pediatric population, can also result in significant financial penalties in the European Union. Similarly, failure to comply with the European Union'sUnion’s requirements regarding the protection of individual personal data can also lead to significant penalties and sanctions. Individual E.U. member states may also impose various sanctions and penalties in case we do not comply with locally applicable requirements.

Manufacturing

The manufacturing of authorized drugs, for which a separate manufacturer'smanufacturer’s license is mandatory, must be conducted in strict compliance with the EMA'sEMA’s GMP requirements and comparable requirements of other regulatory bodies in the European Union, which mandate the methods, facilities and controls used in manufacturing, processing and packing of drugs to assure their safety and identity. The EMA enforces its GMP requirements through mandatory registration of facilities and inspections of those facilities. The EMA may have a coordinating role for these inspections while the responsibility for carrying them out rests with the member states competent authority under whose responsibility the manufacturer falls. Failure to comply with these requirements could interrupt supply and result in delays, unanticipated costs and lost revenues, and could subject the applicantsponsor to potential legal or regulatory action, including but not limited to warning letters, suspension of manufacturing, seizure of product, injunctive action or possible civil and criminal penalties.

Marketing and Promotion

The marketing and promotion of authorized drugs, including industry-sponsored continuing medical education and advertising directed toward the prescribers of drugs and/or the general public, are strictly regulated in the European Union under Directive 2001/83EC, as amended. The applicable regulations aim to ensure that information provided by holders of marketing authorizations regarding their products is truthful, balanced and accurately reflects the safety and efficacy claims authorized by the EMA or by the competent authority of the authorizing member state. Failure to comply with these requirements can result in adverse publicity, warning letters, corrective advertising and potential civil and criminal penalties.

Patent Term Extension

To compensate the patentee for delays in obtaining a marketing authorization for a patented product, a supplementary certificate, or SPC, may be granted extending the exclusivity period for that specific product by up to five years. Applications for SPCs must be made to the relevant patent office in each E.U. member state and the granted certificates are valid only in the member state of grant. An

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application has to be made by the patent owner within six months of the first marketing authorization being granted in the European Union (assuming the patent in question has not expired, lapsed or been revoked) or within six months of the grant of the patent (if the marketing authorization is granted first). In the context of SPCs, the term "product"“product” means the active ingredient or combination of active ingredients for a medicinal product and the term "patent"“patent” means a patent protecting such a product or a new manufacturing process or application for it. The duration of an SPC is calculated as the difference between the patent'spatent’s filing date and the date of the first marketing authorization, minus five years, subject to a maximum term of five years.

A six-month pediatric extension of an SPC may be obtained where the patentee has carried out an agreed pediatric investigation plan, the authorized product information includes information on the results of the studies and the product is authorized in all member states of the European Union.

Brexit and the Regulatory Framework in the United Kingdom

        On June 23, 2016,The United Kingdom’s withdrawal from the electorateEuropean Union took place on January 31, 2020. The European Union and the United Kingdom reached an agreement on their new partnership in the Trade and Cooperation Agreement, or the Agreement, which was applied provisionally beginning on January 1, 2021 and which entered into force on May 1, 2021. The Agreement focuses primarily on free trade by ensuring no tariffs or quotas on trade in goods,

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including healthcare products such as medicinal products. Thereafter, the European Union and the United Kingdom will form two separate markets governed by two distinct regulatory and legal regimes. As such, the Agreement seeks to minimize barriers to trade in goods while accepting that border checks will become inevitable as a consequence that the United Kingdom is no longer part of the single market. As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency, or 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 European Union rules under the Northern Ireland Protocol. The MHRA will rely on the Human Medicines Regulations 2012 (SI 2012/1916) (as amended), or 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 United Kingdom’s withdrawal from the European Union.

​

Furthermore, while the Data Protection Act of 2018 in the United Kingdom voted in favor of leavingthat “implements” and complements the E.U. (commonly referred to as "Brexit"). Thereafter, on March 29, 2017,General Data Protection Regulation, or GDPR, is now effective in the country formally notified the E.U.United Kingdom, it is still unclear whether transfer of its intention to withdraw pursuant to Article 50 of the Lisbon Treaty. The withdrawal of the U.K.data from the European Union will take effect either on the effective date of the withdrawal agreement or, in the absence of agreement, two years after the U.K. provides a notice of withdrawal pursuantEEA to the United Kingdom will remain lawful under GDPR. The Trade and Cooperation Agreement provides for a transitional period during which the United Kingdom will be treated like an E.U. Treaty. SinceMember State in relation to processing and transfers of personal data for four months from January 1, 2021. This may be extended by two further months. After such period, the regulatory framework for pharmaceutical productsUnited Kingdom will be a “third country” under the GDPR unless the European Commission adopts an adequacy decision in respect of transfers of personal data to the U.K. covering quality, safety and efficacy of pharmaceutical products, clinical trials, marketing authorization, commercial sales and distribution of pharmaceutical products is derived from E.U. directives and regulations, Brexit could materially impact the future regulatory regime which applies to products and the approval of product candidates in the U.K. It remains to be seen how, if at all, Brexit will impact regulatory requirements for product candidates and products in the U.K.

United Kingdom. The United Kingdom has a periodalready determined that it considers all of a maximumthe European Union and EEA member states to be adequate for the purposes of two yearsdata protection, ensuring that data flows from the date of its formal notification to negotiate the terms of its withdrawal from, and future relationship with, the E.U. If no formal withdrawal agreement is reached between the United Kingdom to the European Union and theEEA remain unaffected. We may, however, incur liabilities, expenses, costs, and other operational losses under GDPR and applicable E.U., then it is expected the United Kingdom's membership of the E.U. will automatically terminate two years after the submission of the notification of the United Kingdom's intention to withdraw from the E.U. Discussions between Member States and the United Kingdom and the E.U. focused on finalizing withdrawal issues and transition agreements are ongoing. However, limited progressprivacy laws in connection with any measures we take to date in these negotiations and ongoing uncertainty within the UK Government and Parliament sustains the possibility of the United Kingdom leaving the E.U. on March 29, 2019 without a withdrawal agreement and associated transition period in place, which is likely to cause significant market and economic disruption.comply with them.

General Data Protection Regulation

The collection, use, disclosure, transfer, or other processing of personal data regarding individuals in the E.U., including personal health data, is subject to the E.U. General Data Protection Regulation, or the GDPR, which became effective on May 25, 2018. The GDPR is wide-ranging in scope and imposes numerous requirements on companies that process personal data, including requirements relating to processing health and other sensitive data, obtaining consent of the individuals to whom the personal data relates, providing information to individuals regarding data processing activities, implementing safeguards to protect the security and confidentiality of personal data, providing notification of data breaches, and taking certain measures when engaging third-party processors. The GDPR also imposes strict rules on the transfer of personal data to countries outside the E.U., including the U.S., and permits data protection authorities to impose large penalties for violations of the GDPR, including potential fines of up to €20 million or 4% of annual global revenues, whichever is greater. The GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for

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damages resulting from violations of the GDPR. Compliance with the GDPR will be a rigorous and time-intensive process that may increase the cost of doing business or require companies to change their business practices to ensure full compliance.

Pharmaceutical Coverage, Pricing and Reimbursement

In the United States and markets in other countries, patients who are prescribed treatments for their conditions and providers performing the prescribed services generally rely on third-party payors to reimburse all or part of the associated healthcare costs. Significant uncertainty exists as to the coverage and reimbursement status of products approved by the FDA and other government authorities. Thus, even if a product candidate is approved, sales of the product will depend, in part, on the extent to which third-party payors, including government health programs in the United States such as Medicare and Medicaid, commercial health insurers and managed care organizations, provide coverage, and establish adequate reimbursement levels for, the product. The process for determining whether a payor will provide coverage for a product may be separate from the process for setting the price or reimbursement rate that the payor will pay for the product once coverage is approved. Third-party payors are increasingly challenging the prices charged, examining the medical necessity, and reviewing the cost-effectiveness of medical products and services and

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imposing controls to manage costs. Third-party payors may limit coverage to specific products on an approved list, also known as a formulary, which might not include all of the approved products for a particular indication.

To secure coverage and reimbursement for any product that might be approved for sale, a company may need to conduct expensive pharmacoeconomic studies in order to demonstrate the medical necessity and cost-effectiveness of the product, in addition to the costs required to obtain FDA or other comparable marketing approvals. Nonetheless, product candidates may not be considered medically necessary or cost effective. A decision by a third-party payor not to cover a product candidate could reduce physician utilization once the product is approved and have a material adverse effect on sales, results of operations and financial condition. Additionally, a payor'spayor’s decision to provide coverage for a product does not imply that an adequate reimbursement rate will be approved. Further, one payor'spayor’s determination to provide coverage for a drug product does not assure that other payors will also provide coverage and reimbursement for the product, and the level of coverage and reimbursement can differ significantly from payor to payor.

The containment of healthcare costs also has become a priority of federal, state and foreign governments and the prices of drugs have been a focus in this effort. Governments have shown significant interest in implementing cost-containment programs, including price controls, restrictions on 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 and measures, could further limit a company'scompany’s revenue generated from the sale of any approved products. Coverage policies and third-party reimbursement rates may change at any time. Even if favorable coverage and reimbursement status is attained for one or more products for which a company or its collaborators receive marketing approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

Outside the United States, ensuring adequate coverage and payment for a product also involves challenges. Pricing of prescription pharmaceuticals is subject to governmental control in many countries. Pricing negotiations with governmental authorities can extend well beyond the receipt of regulatory marketing approval for a product and may require a clinical trial that compares the cost effectiveness of a product to other available therapies. The conduct of such a clinical trial could be expensive and result in delays in commercialization.

In the European Union, 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

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agreed. Some countries may require the completion of additional studies that compare the cost-effectiveness of a particular drug candidate to currently available therapies or so called health technology assessments, in order to obtain reimbursement or pricing approval. For example, the European Union provides options for its member states to restrict the range of products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. E.U. European Union member states may approve a specific price for a product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the product on the market. Other member states allow companies to fix their own prices for products, but monitor and control prescription volumes and issue guidance to physicians to limit prescriptions. Recently, many countries in the European Union have increased the amount of discounts required on pharmaceuticals and these efforts could continue as countries attempt to manage healthcare expenditures, especially in light of the severe fiscal and debt crises experienced by many countries in the European Union. The downward pressure on health care costs in general, particularly prescription drugs, has become intense. As a result, increasingly high barriers are being erected to the entry of new products. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained. Reference pricing used by various European Union member states, and parallel trade,i.e., arbitrage between low-priced and high-priced member states, can further reduce prices. There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any products, if approved in those countries.