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This Annual Report on Form 10-K contains forward-looking statements“forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended,federal securities laws, which statements are subject to substantial risks and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statementsuncertainties and are based on our management’s beliefsestimates and assumptions and on information currently available to our management.assumptions. All statements, other than statements of historical facts, are “forward-looking statements” for purposes of these provisions, including thosestatements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, financing needs, plans or intentions relating to future events or our future financial performance.products and markets, and business trends and other information referred to under the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Business” are forward-looking statements. In some cases, you can identify forward-looking statements by terminologyterms such as “anticipate,” “believe,” “can,” “could,” “design,” “develop,” “estimate,” “expect,” “intend,” “objective,” “may,” “might,” “will,“plan,” “potential,” “predict,” “should,” “expect,“will,” “plan,“would,” “anticipate,” “project,” “believe,” “estimate,” “predict,” “potential,” “intend” or “continue,” the negative of these terms, likeand similar expressions intended to identify forward-looking statements. Forward-looking statements are not historical facts, and reflect our current views with respect to future events. Given the significant uncertainties, you should not place undue reliance on these forward-looking statements.

There are a number of risks, uncertainties and other factors that could cause our actual results to differ materially from the forward-looking statements expressed or implied in this Annual Report on Form 10-K. Such risks, uncertainties and other factors include, among others, the following:

There may be other words or terms of similar meaning in connection with any discussion of future operating or financial performance. These statements are only predictions. Allfactors that may cause our actual results to differ materially from the forward-looking statements includedexpressed or implied in this Annual Report on Form 10-K, are based on information available to us on the date hereof,including factors disclosed in “Risk Factors” and we assume no obligation to update any such forward-looking statements. Any or“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should evaluate all of our forward-looking statements in this document may turn out to be wrong. Actual events or results may differ materially. Our forward-looking statements can be affected by inaccurate assumptions we might make or by known or unknown risks, uncertainties and other factors. We discuss many of these risks, uncertainties and other factorsmade in this Annual Report on Form 10-K in greater detail under the heading “Item 1A—Risk Factors.” We caution investors that our business and financial performance are subject to substantialcontext of these risks and uncertainties.

Clinical TrialRett syndrome is an X-linked neurodevelopmental disorder caused by a pathogenic mutation in one copy of NL-201

NGN-401 contains the EXACT regulatory elements shown above, which regulate the expression of the full-length human MECP2 gene. Expression is driven by a mammalian promoter that has been used in gene therapy clinical trials. This genetic construct is packaged into an AAV9 capsid.

In addition, there are specific inclusion criteria related to trofinetide, a medicine approved by the FDA for Rett syndrome in March 2023. Patients enrolling in the Phase 1/2 clinical trial may be trofinetide naïve or trofinetide failures, with “failures” defined as having tried trofinetide and discontinued for tolerability or lack of efficacy or other reasons. Following NGN-401 dosing, trofinetide may be initiated after a specified time period and with the support of the IL-2treating clinician. Key assessments in the NGN-401 clinical trial will be taken at three, six, nine, and IL-15 receptors. NL-201 was12 months, with efficacy assessments of interest including autonomic function, hand function, communication, and gross motor function.

There is a naturally occurring Borderdale sheep model that is deficient in the CLN5 protein and shows several of the IL-2 receptor (also knownsymptoms found in human CLN5 Batten disease, including progressive vision loss, motor and gait abnormalities, and premature death. These animals typically reach the humane endpoint by 16-19 months, with a maximal life expectancy of 22 months. A clinical scoring system was developed by Lincoln University comprising 10 physical domains to evaluate the disease phenotype of these sheep, although only six domains developed a progressive change over time in the disease model. Data for a modified ovine Batten disease rating scale, consisting of the cumulative score of these six domains, are shown below, with a score of 24 reflecting a phenotypically normal animal.

Animals that received AAV9/oCLN5 at either an early symptomatic (six months of age) or advanced symptomatic (nine months of age) disease state exhibited delayed disease progression and stabilized clinical function, demonstrated above in the clinical scoring data. AAV9/oCLN5 treatment preserved vision in the treated eye and mitigated declines in body weight, intracranial volume, and retinal function, as CD25) while enhancing bindingwell as ameliorated brain and retinal pathology.

We conducted an additional study (shown above) in the ovine model of CLN5 disease to evaluate an approximately 4x higher ICV dose of AAV9/oCLN5 administered at an early symptomatic disease stage (six months of age), as well as to further explore IVT dosing. Data in this preclinical model demonstrated that the beta4x higher ICV dose of AAV9/oCLN5 along with a modest IVT dose increase was generally well tolerated in this disease model and gamma subunits. In multiple preclinical animal models, a precursor to NL-201 demonstrated substantial antitumor activity without detectable binding to CD25,an improved therapeutic effect as compared to native IL-2. Followingthe cohort of ovine animals receiving a similar ICV dose as previously tested, and approximately only 30% of the IVT dose. These data provide additional support for our clinical strategy for dose escalation in our ongoing Phase 1/2 clinical trial of NGN-101.

We conducted a GLP toxicology and biodistribution study with NGN-101 in NHPs with three- and six-month timepoints. NGN-101 was generally well-tolerated in this study. Non-adverse transient aminotransferase elevations were observed, which were not associated with anatomic pathology findings. In addition, one animal inadvertently dosed with a two-fold higher dose than our highest planned IVT clinical dose experienced a moderately severe intraocular inflammatory response, which subsided with anti-inflammatory treatment. Based on these findings, the high dose cohort was considered the NOAEL.

The biotechnology and pharmaceutical industries generally, and the first patient in a Phase 1 clinical trialgene therapy field specifically, are characterized by rapid evolution of NL-201 for advanced solid tumors. On May 16, 2022, we announcedtechnologies, competition and strong defense of intellectual property. Any product candidates that we had begundevelop and commercialize will face competition from existing therapies and new therapies that may become available in the future. While we believe our products, technology, scientific knowledge, talent and manufacturing capabilities differentiate us and provide us with competitive advantages, we face competition from other biotechnology companies, pharmaceutical and specialty pharmaceutical companies, as well as academic institutions. Our ability to compete will significantly depend upon our ability to complete necessary clinical trials and regulatory approval processes, and effectively market any drug that we may successfully develop.

Accordingly, competitors may be more successful than us in obtaining regulatory approval for therapies and in achieving widespread market acceptance of their drugs. It is also possible that the development of targeted and conditionally activated molecules to create potent immune agonists. We have been combining our expertise in de novo protein design, including data gathered from the development of NL-201 and research into other novel cytokine mimetics, with advances in machine learning and neural networks to expand the scopea cure or more effective treatment method for any of our design process to include more complex protein structurestargeted indications by a competitor could render our product candidate non-competitive or obsolete, or reduce the demand for our product candidate before we can recover our development and create more sophisticated and dynamic structural elements than were previously possible.commercialization expenses.

In September 2020, we entered into a Non-Exclusive License Agreement with Virovek, Inc., pursuant to which we have a license to use certain patents and know-how on a non-exclusive basis related to our baculovirus process in exchange for low single-digit percentage royalties on future commercial net sales of each product using the baculovirus process, development milestone payments followingof up to $200,000 in the aggregate, and a nonrefundable annual license fee. This agreement continues until the later of (a) the expiration of the last to expire patent right that covers the manufacture, use, offer for sale, sale, importation, export or supply of any licensed product, (b) ten years after the first commercial sale of any licensed product, or (c) the expiration of all regulatory or market exclusivities. We may terminate this agreement for convenience upon 60 days’ notice.

In January 2023, we entered into a licensed product; (v)Non-Exclusive License Agreement with Sigma-Aldrich Co. LLC, pursuant to which we have a license to certain percentage of any sublicense consideration (other than royalties)patents and know-how on a non-exclusive basis related to certain cell lines used in our baculovirus process in exchange for a small annual fee on a product-by-product basis, payable once the first product candidate enters the clinic. In addition, on a product-by-product basis, we receive from sublicensees, ranging from 50% to low single digit percentages based on the stage of development at the time the sublicense is executed; and (vi) a certain percentage of consideration we receive from an acquisition of us or our assets, ranging from 50% to zero based on the stage of development at the relevant time. We are obligated to pay royalties on a country-by-country basis untilup to $2.5 million in the expiration of the last valid claim withinaggregate for development-related milestones. This agreement remains in force for as long as we continue to possess and use the licensed patent rights in such country.

The FDA and other healthregulatory authorities worldwide regulate and inspect equipment, facilities and processes used in manufacturing pharmaceutical products prior to approval. If we or our partners fail to comply with applicable requirements and conditions of product approval, the FDA and/or other global health authorities may seek sanctions, including fines, civil penalties, injunctions, suspension of manufacturing operations, operating restrictions, withdrawal of FDA and/or other global health authorities’ approval, seizure or recall of products and criminal prosecution.

Preclinical tests include laboratory evaluation ofand Clinical Development

Prior to beginning the first clinical trial with a product chemistry, formulation, and toxicity, as well as animal trials to access the characteristics and potential safety and efficacy of the product. The conduct of the preclinical testscandidate, we must comply with federal regulations and requirements, including Good Laboratory Practices. The results of preclinical testing are submittedsubmit an IND to the FDA. An IND is a request for authorization from the FDA as partto administer an investigational new drug product to humans. The central focus of an IND along with other information, including information aboutsubmission is on the general investigational plan and the protocol or protocols for clinical trials. The IND also includes results of animal and in vitro studies assessing the toxicology, pharmacokinetics, pharmacology and pharmacodynamic characteristics of the product (as applicable), chemistry, manufacturing and controls information, and aany available human data or literature to support the use of the investigational product. An IND must become effective before human clinical trials may begin. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day period, raises safety concerns or questions about the proposed clinical trial protocol. Long-term preclinical tests,trial. In such as tests of reproductive toxicity and carcinogenicity in animals, may continue aftera case, the IND is submitted. A 30-day waiting period aftermay be placed on a partial or full clinical hold. In the submissionevent of eacha clinical hold, the IND is required prior to the commencement of clinical testing in humans. Ifsponsor and the FDA has neither commented on nor questioned the IND within this 30-day period,must resolve any outstanding concerns or questions before the clinical trial proposedcan begin. Submission of an IND therefore may or may not result in the IND may begin. FDA authorization to begin a clinical trial.

Clinical trials involve the administration of the investigational drugproduct to patientshuman subjects under the supervision of qualified investigators following GCPs, an international standard meant to protectin accordance with cGCPs, which include the rights and health of patients and to define the roles ofrequirement that all research subjects provide their informed consent for their participation in a clinical trial sponsors, administrators and monitors.study. Clinical trials must be conducted: (i) in compliance with federal regulations; (ii) in compliance with GCPs, an international standard meant to protect the rights and health of patients and to define the roles of clinical trial sponsors, administrators, and monitors; as well as (iii)are conducted under protocols that detaildetailing, among other things, the objectives of the study, the parameters to be used in monitoring safety and the efficacyeffectiveness criteria to be evaluated. Each protocol involving testing on U.S. patientsA separate submission to an existing IND must be made for each successive clinical trial conducted during product development and for any subsequent protocol amendmentsamendments. Furthermore, an independent IRB for each site proposing to conduct the clinical trial must be submitted toreview and approve the FDA as part ofplan for any clinical trial and its informed consent form before the IND.clinical trial begins at that site, and must monitor the study until completed.

A sponsor who wishes to conduct a clinical trial outside of the U.S. may, but need not, obtain FDA authorization to conduct the clinical trial under an IND. If a foreign clinical trial is not conducted under an IND, the sponsor may submit data from the clinical trial to the FDA in support of a BLA. The FDA will accept a well-designed and well-conducted foreign clinical trial not conducted under an IND if itthe trial was conducted in accordance with cGCP requirements and the FDA is determinedable to validate the data through an onsite inspection if deemed necessary.

For purposes of BLA approval, human clinical trials are typically conducted in three sequential phases that the participants or patients are being exposed to an unacceptable health risk.

In mostsome cases, the FDA requires two adequate and well-controlled Phase 3may require, or companies may voluntarily pursue, additional clinical trials after a product is approved to demonstrategain more information about the efficacyproduct. These so-called Phase 4 studies may be made a condition to approval of the drug. A single Phase 3 trial may be sufficient in rare instances including (1) where the study is a large multicenter trial demonstrating internal consistency and a statistically very persuasive finding of a clinically meaningful effect on mortality, irreversible morbidity or prevention of a disease with a potentially serious outcome and confirmation of the result in a second trial would be practically or ethically impossible or (2) when in conjunction with other confirmatory evidence.

Assuming successful completion of all required testing in accordance with all applicable regulatory requirements, a BLA isthe results of product development, preclinical studies and clinical trials are submitted to the FDA as part of a BLA requesting approval to request market approval for the product for one or more indications. FDA approval of a BLA must be obtained before a biologic may be marketed in specified indications.the U.S. The BLA must include theall relevant data available from pertinent preclinical studies and clinical trials, including negative or ambiguous results of all preclinical, clinical, and other testing and a compilation of dataas well as positive findings, together with detailed information relating to the product’s pharmacology, chemistry, manufacturing, controls, and controls. To support marketing approval, the data submitted must be sufficient in quality and quantityproposed labeling, among other things. Data can come from company-sponsored clinical studies intended to establishtest the safety and effectiveness of the investigational drug product, to the satisfactionor from a number of the FDA. The cost of preparingalternative sources, including studies initiated and submitting a BLA is substantial.sponsored by investigators. The submission of most BLAs is additionally subject toa BLA requires payment of a substantial user fee; there may be some instances in which theapplication user fee is waived.

After the FDA evaluates a BLA and conducts inspections of manufacturing facilities where the product and/or its drug substance will be produced, the FDA may issue an approval letter or a Complete Response Letter. An approval letter authorizes commercial marketing of the product with orphanspecific prescribing information for one or more specific indications. A Complete Response Letter will describe all of the deficiencies that the FDA has identified in the BLA, except that where the FDA determines that the data supporting the application are inadequate to support approval, the FDA may issue the Complete Response Letter without first conducting required inspections, testing submitted product designation exceptlots and/or reviewing proposed labeling. In issuing a Complete Response Letter, the FDA may recommend actions that the applicant might take to place the BLA in condition for approval, including requests for additional information or clarification. If a Complete Response Letter is issued, the applicant may either resubmit the BLA, addressing all of the deficiencies identified in the letter, or withdraw the application or request an opportunity for a hearing. The FDA may delay or refuse approval of a BLA if applicable regulatory criteria are not satisfied, require additional testing or information and/or require post-marketing testing and surveillance to monitor safety or efficacy of a product.

If regulatory approval of a product is granted, such approval will be granted for one or more particular indications and may entail limitations on the indicated uses for which such product may be marketed. For example, the FDA may approve the BLA with a new active ingredient thatREMS to ensure the benefits of the product outweigh its risks. A REMS is a molecularly targeted cancersafety strategy to manage a known or potential serious risk associated with a product intendedand to enable patients to have continued access to such medicines by managing their safe use, and could include medication guides, physician communication plans, or elements to assure safe use, such as special training or monitoring requirements, restricted distribution methods, patient registries and other risk minimization tools. The FDA also may condition approval on, among other things, changes to proposed labeling or the development of adequate controls and specifications. Once a BLA is approved, the FDA may withdraw the product approval if compliance with pre- and post-marketing requirements is not maintained or if problems occur after the product reaches the marketplace. The FDA may require one or more Phase 4 post-market studies and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization and may limit further marketing of the product based on the results of these post-marketing studies.

Additional Considerations for Gene Therapy Products

In addition to the treatmentregulations discussed above, there are a number of additional considerations that apply to clinical trials involving the use of gene therapy. Supervision of human gene transfer trials includes evaluation and assessment by an institutional biosafety committee (“IBC”) a local institutional committee that reviews and oversees research utilizing recombinant or synthetic nucleic acid molecules at that institution. The IBC assesses the safety of the research and identifies any potential risk to public health or the environment, and such review may result in some delay before initiation of a clinical trial. The FDA has issued various guidance documents regarding gene therapies, which outline additional factors that the FDA will consider at each of the above stages of development and relate to, among other things: the proper preclinical assessment of gene therapies; the CMC information that should be included in an IND application; the proper design of tests to measure product efficacy or potency in support of an adult cancerIND or BLA application; and directed atmeasures to observe delayed adverse effects in subjects who have been exposed to investigational gene therapies when the risk of such effects is high. For instance, the FDA usually recommends that sponsors observe all surviving subjects who receive treatment using gene therapies that are based on adeno-associated virus vectors in clinical trials for potential gene therapy-related delayed adverse events for a molecular target determined byminimum five-year period. FDA does not require the long-term tracking to be substantially relevantcomplete prior to its review of the growthBLA.

Additionally, products intended for use in treating serious or life-threatening diseases or conditions may receive accelerated approval upon a determination that the product has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments. Post-marketingAs a condition of accelerated approval, the FDA will generally require the sponsor to perform adequate and well-controlled post-marketing clinical studies with due diligence to verify and describe the anticipated effect on irreversible morbidity or mortality or other clinical benefit. Under the Food and Drug Omnibus Reform Act of 2022 (“FDORA”), the FDA may require, as appropriate, that such studies be underway prior to approval or within a specific time period after the date of approval for a product granted accelerated approval. Under FDORA, the FDA has increased authority for expedited procedures to withdraw approval of a product or indication approved under accelerated approval if the sponsor fails to conduct the required post-marketing studies or completion of ongoingif such studies after marketing approval are requiredfail to verify the drug’spredicted clinical benefit in relationship tobenefit. In addition, the surrogate endpoint or ultimate outcome in relationship toFDA currently requires as a condition for accelerated approval pre-approval of promotional materials, which could adversely impact the clinical benefit.

Fast track designation, breakthrough therapy designation, RMAT designation and priority review do not change the standards for approval but may expedite the development or approval process. Even if a BLA, uponproduct qualifies for one or more of these programs, the requestFDA may later decide that the product no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.

If a product that has orphan drug designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to orphan drug exclusive approval (or exclusivity), which means that the FDA may not approve any other applications, including a full BLA, to market the same product for the same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with orphan drug exclusivity by means of greater effectiveness, greater safety or providing a major contribution to patient care or if the holder of the orphan drug exclusivity cannot assure the availability of sufficient quantities of the orphan drug to meet the needs of patients with the disease or condition for which the product was designated. Orphan drug exclusivity does not prevent the FDA from approving a different drug or biologic for the same disease or condition, or the qualitysame drug or biologic for a different disease or condition. Among the other benefits of evidence necessary to support approval.

A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan drug designation. In addition, exclusive marketing rights in the U.S. may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantities of adventitious agents, the PHSA emphasizesproduct to meet the importanceneeds of manufacturing controls for products whose attributes cannot be precisely defined. The PHSA also provides authoritypatients with the rare disease or condition.

There is some uncertainty with respect to the FDAFDA’s interpretation of the scope of orphan drug exclusivity. Historically, exclusivity was specific to immediately suspend biologics licensesthe orphan indication for which the drug was approved. As a result, the scope of exclusivity was interpreted as preventing approval of a competing product. However, in situations where there exists2021, the federal court in Catalyst Pharmaceuticals, Inc. v. Becerra suggested that orphan drug exclusivity covers the full scope of the orphan-designated “disease or condition” regardless of whether a dangerdrug obtained approval for a narrower use.

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

The FDA and other federal regulatory agencies closely regulateregulates the marketing, labeling, advertising and promotion of drugs through, among other things, standardsbiologics. A company can make only those claims relating to safety and regulations for direct-to-consumer advertising, communications regarding unapproved uses, industry-sponsored scientificefficacy, purity and educational activities, and promotional activities involving the Internet. A product cannot be commercially promoted before it is approved. After approval, product promotion cannot be false or misleading, and product claims must be adequately substantiated. Healthcare providerspotency that are permitted to prescribe drugs for “off-label” uses—that is, uses not approved by the FDA and thereforein accordance with the provisions of the approved label. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. Failure to comply with these requirements can result in, among other things, adverse publicity, warning letters, corrective advertising and potential civil and criminal penalties. Physicians may prescribe legally available products for uses that are not described in the drug’s labeling—becauseproduct’s labeling and that differ from those tested by drug manufacturers and approved by the FDA. Such off-label uses are common across medical specialties. Physicians may believe that such off-label uses are the best treatment for many patients in varied circumstances. The FDA does not regulate the practicebehavior of medicine. However,physicians in their choice of treatments. The FDA regulationsdoes, however, restrict manufacturer’s communications on the subject of off-label use of their products.

In addition, the distribution of prescription drug products, including most biological products that require a prescription, are subject to the Prescription Drug Marketing Act, or the PDMA, which regulates the distribution of drug samples at the federal level, and sets minimum standards for the registration and regulation of drug distributors by the states. Both the PDMA and state laws limit the distribution of prescription drug product samples and impose stringent restrictionsrequirements to ensure accountability in distribution.

Biosimilarity, which requires that there be no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and efficacy or potency, is generally shown through analytical studies, animal studies, and a clinical study or studies. Interchangeability requires that a product is biosimilar to the reference product and the product must demonstrate that it can be expected to produce the same clinical results as the reference product in any given patient and, for products that are administered multiple times to an individual, the biologic and the reference biologic may be alternated or switched after one has been previously administered without increasing safety risks or risks of diminished efficacy relative to exclusive use of the reference biologic. A product shown to be biosimilar or interchangeable with an FDA-approved reference biological product may rely in part on manufacturers’ communications regarding off-label uses. Broadly speaking,the FDA’s previous determination of safety and effectiveness for the reference product for approval, which can potentially reduce the cost and time required to obtain approval to market the product. Complexities associated with the larger, and often more complex, structures of biological products, as well as the processes by which such products are manufactured, pose significant hurdles to implementation of the abbreviated approval pathway that are still being worked out by the FDA. In September 2021, the FDA issued two guidance documents intended to inform prospective applicants and facilitate the development of proposed biosimilars and interchangeable biosimilars, as well as to describe the FDA’s interpretation of certain statutory requirements added by the BPCIA.

Under the BPCIA, an application for a manufacturerbiosimilar product may not promotebe submitted to the FDA until four years following the date that the reference product was first licensed by the FDA. In addition, the approval of a drug for off-label use, butbiosimilar product may engage in non-promotional, balanced communication regarding off-label use under specified conditions. Failure to comply with applicable FDA requirements and restrictions in this area may subject a company to adverse publicity and enforcement actionnot be made effective by the FDA until 12 years from the U.S. Departmentdate on which the reference product was first licensed. During this 12-year period of Justice, or DOJ, or the Officeexclusivity, another company may still market a competing version of the Inspector General of the Department of Health and Human Services, or HHS, 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.

Clinical trials involve administeringA biological product can also obtain pediatric market exclusivity in the investigational productU.S. Pediatric exclusivity, if granted, adds six months to healthy volunteersexisting exclusivity periods and patent terms. This six-month exclusivity, which runs from the end of other exclusivity protection or patients underpatent term, may be granted based on the supervisionvoluntary completion of a qualified principal investigator. pediatric study in accordance with an FDA-issued “Written Request” for such a study.

The TGA has developed guidelines for a CTN. Under the CTN process, all material relating to the proposed trialBPCIA is submitted directly to the HREC of each institution at which the trial iscomplex and continues to be conducted. An HREC isinterpreted and implemented by the FDA. In July 2018, the FDA announced an independentaction plan to encourage the development and efficient review committee set up under guidelinesof biosimilars, including the establishment of a new office within the agency that will focus on therapeutic biologics and biosimilars. On December 20, 2020, Congress amended the PHSA as part of the Australian National Health and Medical Research Council. The roleCOVID-19 relief bill to further simplify the biosimilar review process by making it optional to show that conditions of an HREC isuse proposed in labeling have been previously approved for the reference product, which used to ensure the protection of rights, safety and well-being of human subjects involved inbe a clinical trial by, among other things, reviewing, approving and providing continuing review of trial protocols and amendments, andrequirement of the methods and materialapplication. In addition, government proposals have sought to be used in obtaining and documenting informed consent ofreduce the trial subjects. The TGA is formally notified by submission of a CTN application but does not review the safety of the drug or any aspect of the proposed trial. The approving authority of each institution gives the final approval for the conduct of the clinical trial, having due regard to advice from the HREC. Following approval, responsibility for all12-year reference product exclusivity period. Other aspects of the trial conducted underBPCIA, some of which may impact the BPCIA exclusivity provisions, have also been the subject of recent litigation. As a CTNresult, the ultimate impact, implementation, and impact of the BPCIA is subject to significant uncertainty.

In the U.S., after a BLA is approved, owners of relevant drug patents may apply for up to a five-year patent extension, which permits patent term restoration as compensation for the patent term lost during the FDA regulatory process. The allowable patent term extension is typically calculated as one-half the time between, the latter of the effective date of an IND and issue date of the patent for which extension is sought, and the submission date of a BLA, plus the time between BLA submission date and the BLA approval date up to a maximum of five years. The time can be shortened if the FDA determines that the applicant did not pursue licensure with due diligence. The total patent term after the extension may not exceed 14 years from the date of product licensure. Only one patent applicable to a licensed biological product is eligible for extension and only those claims covering the product, a method for using it, or a method for manufacturing it may be extended and the application remainsfor the extension must be submitted prior to the expiration of the patent in question. However, Neurogene may not be granted an extension because of, for example, failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements. Some, but not all, foreign jurisdictions possess patent term extension or other additional patent exclusivity mechanisms that may be more or less stringent and comprehensive than those of the U.S.

Other Healthcare Data Protection, and Privacy Laws and Compliance Requirements

In the United States, our activitiesPharmaceutical companies are potentially subject to additional healthcare regulation and oversight under other healthcare lawsenforcement by variousthe federal stategovernment and localby authorities in addition to the FDA, including the Centers for Medicare & Medicaid Services, or CMS, other divisions of the HHS (e.g., the Office of Inspector General), the DOJ,states and individual U.S. Attorney offices within the DOJ, and state and local governments. Theseforeign jurisdictions in which they conduct their business. Such laws include, without limitation: the federal Anti-Kickback Statute which(“AKS”); the federal False Claims Act (“FCA”); the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”); and similar foreign, federal and state fraud, abuse and transparency laws.

The AKS prohibits, among other things, any person or entity,persons and entities from knowingly and willfully soliciting, receiving, offering or paying soliciting or receiving any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce, or in return for, either the referral of an individual, or purchasing, leasing, ordering or arranging for the purchase, lease, order, arrangement, or orderrecommendation of any good, facility,an item or service reimbursable, in whole or part,for which payment may be made under Medicare, Medicaid or anotherany federal healthcare program. The term remuneration has been interpreted broadly to include anything of value. The federal Anti-Kickback StatuteAKS has been interpreted to apply to arrangements between pharmaceutical manufacturers on one hand, and prescribers purchasers, and formulary managerspurchasers on the other. The government often takes the position that to violate the AKS, only one purpose of the remuneration need be to induce referrals, even if there are other legitimate purposes for the remuneration. There are a number of statutory exceptions and regulatory safe harbors protecting some common activities from prosecution. The exceptions and safe harborsAKS prosecution, but they are drawn narrowly and practices that involve remuneration, such as consulting agreements, that may be alleged to be intended to induce prescribing, purchasing or recommending may be subject to scrutiny if they do not qualify for an exception or safe harbor. Our practices may not in all cases meet all of the criteria for protection under a statutory exception or regulatory safe harbor from federal Anti-Kickback Statute liability.harbor. Failure to meet all of the requirements of a particular applicable statutory exception or regulatory safe harbor however, does not make the conduct per se illegal under the Anti-Kickback Statute.AKS. Instead, the legality of the arrangement will be evaluated on a case-by-case basis based on a cumulative review of all of its facts and circumstances. Violations are subject to civil and criminal fines and penalties for each violation, plus up to three times the remuneration involved, imprisonment, and exclusion from government healthcare programs. In addition, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively, the Affordable Care Act, further strengthened these laws by amending the intent standard under the federal Anti-Kickback Statute and the criminal health care fraud statutes (discussed below), such that a person or entity no longer needs to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation. In addition, the Affordable Care Act codified case lawgovernment may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback StatuteAKS constitutes a false or fraudulent claim for purposes of the FCA or federal civil False Claims Act (discussed below).monetary penalties.

HIPAA created additional federal criminal statutes that prohibit, knowingly and willfullyamong other things, executing or attempting to execute, a scheme to defraud or to obtain, by means of false or fraudulent pretenses, representations or promises, any money or property owned by, or under the control or custody of, any healthcare benefit program, including private third-party payors, and knowingly and willfully falsifying, concealing or covering up by any trick scheme or device a material fact or making any materially false fictitiousstatements or fraudulent statementrepresentations relating to healthcare matters.

We are also subject to federal price reporting laws and federal consumer protection and unfair competition laws. Federal price reporting laws require manufacturers to calculate and report complex pricing metrics to government programs, where such reported prices may be used in connection with the deliverycalculation of reimbursement and/ or payment for healthcare benefits, itemsdiscounts on approved products. Federal consumer protection and unfair competition laws broadly regulate marketplace activities and activities that potentially harm consumers.

Numerous state, federal, and foreign laws govern the collection, dissemination, use, access to, confidentiality, and security of personal information, including health-related information. In the U.S., numerous federal and state laws and regulations, including state data breach notification laws, state health information privacy laws, and federal and state consumer protection laws and regulations that govern the collection, use, disclosure, and protection of health-related and other state programs,personal information apply to our operations or in several states, apply regardlessthe operations of the payor.

Significant civil and criminal fines and other penalties may be imposed for violating HIPAA. A covered entity.entity or business associate is also liable for civil money penalties for a violation that is based on an act or omission of any of its agents, which may include a downstream business associate, as determined according to the federal common law of agency. HITECH also created four new tiers of civil monetary penalties, amended HIPAA to makeincreased the civil and criminal penalties directly applicable to covered entities and business associates and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorney’sattorneys’ fees and costs associated with pursuing federal civil actions. To the extent that we submit electronic healthcare claims and payment transactions that do not comply with the electronic data transmission standards established under HIPAA and HITECH, payments to us may be delayed or denied.

In addition, somecertain state laws, may more broadlysuch as the California Consumer Privacy Act of 2018 (“CCPA”), as amended by the California Privacy Rights Act of 2020 (“CPRA”) and California’s Confidentiality of Medical Information Act, govern the privacy and security of healthpersonal information, including health-related information in specifiedcertain circumstances, some of which are more stringent than HIPAA and many of which differ from each other in significant ways from HIPPA/HITECH and may not have the same effect, thus complicating compliance efforts.

Significant uncertainty exists as to the coverage and reimbursement status of any drug productspharmaceutical or biological product for which we may obtain regulatory approval. In the United States and markets in other countries, salesSales of any products for which we receive regulatory approval for commercial sale willproduct, if approved, depend, in part, on the extent thatto which such product will be covered by third-party payors, providesuch as federal, state, and foreign government healthcare programs, commercial insurance and managed healthcare organizations, and the level of reimbursement, if any, for such product by third-party payors. Decisions regarding whether to cover any of its product candidates, if approved, the extent of coverage and establishamount of reimbursement to be provided are made on a plan-by-plan basis. Further, no uniform policy for coverage and reimbursement exists in the U.S., and coverage and reimbursement can differ significantly from payor to payor. Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement rates, but also have their own methods and approval process apart from Medicare determinations. As a result, the coverage determination process is often a time-consuming and costly process that will require it to provide scientific and clinical support for the use of its product candidates to each payor separately, with no assurance that coverage and adequate reimbursement levels for such drug products. Inwill be applied consistently or obtained in the United States, third-partyfirst instance. Factors payors include federal healthcare programs, state healthcare programs, managed care providers, privateconsider in determining reimbursement are based on whether the product is:

Third-party payors are increasingly challenging the price,prices charged for medical products and services, examining the medical necessity and reviewing the cost-effectivenesscost effectiveness of drugpharmaceutical or biological products, medical devices and medical services, in addition to questioning their safety and efficacy. We may needAdoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit sales of any product that receives approval. Decreases in third-party reimbursement for any product or a decision by a third-party not to conduct expensive pharmacoeconomic studies in order to demonstratecover a product could reduce physician usage and patient demand for the medical necessityproduct.

For products administered under the supervision of a physician, obtaining coverage and cost-effectiveness of our products, in addition to the costs required to obtain FDA approvals. NL-201 or our future product candidates may not be considered medically necessary or cost-effective. A payor’s decision to provide coverage for a drug product does not imply that an adequate reimbursement rate willmay be approved. Further, one payor’s determination to provide coverage for a drug product does not assure that other payors will also provide coverageparticularly difficult because of the higher prices often associated with such drugs. Additionally, separate reimbursement for the drug product. Adequate third-party reimbursementproduct itself or the treatment or procedure in which the product is used may not be available, to enable us to maintain price levels sufficient to realize an appropriate return on our investment in product development. If a drug product is reimbursed under a governmental healthcare program, such as Medicare, Medicaid or TRICARE, additional laws and program requirements will apply.

In addition, net prices for drugs but monitormay be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and control company profits. The downward pressure on healthcare costsby any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in general, particularly prescription drugs, has become more intense. As a result, increasingly high barriersthe U.S. Increasingly, third-party payors are being erectedrequiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products. We cannot be sure that reimbursement will be available for any product candidate that we may commercialize and, if reimbursement is available, the level of reimbursement. In addition, many pharmaceutical manufacturers must calculate and report certain price reporting metrics to the entry of new products.government, such as average sales price, or ASP, and best price. Penalties may apply in some cases when such metrics are not submitted accurately and timely. Further, these prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs.

Finally, in some foreign countries, the proposed pricing for a drug must be approved before it may be lawfully marketed. The requirements governing drug pricing vary widely from country to country. For example, the European Union provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. To obtain reimbursement or pricing approval, some of these countries may require the completion of clinical trials that compare the cost effectiveness of a particular product candidate to currently available therapies. A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market. We may face competitionThere 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 of our product candidatescandidates. Historically, products launched in the European Union do not follow price structures of the U.S. and generally prices tend to be significantly lower.

Other legislative changes have been proposed and adopted since the ACA was enacted. For example, the Budget Control Act of 2011 and subsequent legislation, among other things, created measures for spending reductions by Congress that include aggregate reductions of Medicare payments to providers of 2% per fiscal year, which remain in effect through 2032. Due to the Statutory Pay-As-You-Go Act of 2010, estimated budget deficit increases resulting from lower-priced productsthe American Rescue Plan Act of 2021, and subsequent legislation, Medicare payments to providers will be further reduced starting in foreign countries that have placed price controls on pharmaceutical products. 2025 absent further legislation. The U.S. American Taxpayer Relief Act of 2012 further reduced Medicare payments to several types of providers and increased the statute of limitations period for the government to recover overpayments to providers from three to five years.

In addition, in some countries, cross-border imports from low-priced markets exert a commercial pressure on pricing within a country.

In addition, the U.S. government, state legislatures and foreign governments have continued implementing cost-containment programs, including price controls, restrictions on coverage and reimbursement and requirements for substitution of generic products. The IRA includes several provisions that may impact our business to support market changesvarying degrees, including provisions that strengthen supply chains, promote biosimilars and generic drugs, and increase price transparency. These initiatives recently culminated inreduce the enactment of the Inflation Reduction Act of 2022, or IRA, which will, among other things, allow the HHS to negotiate the selling price of certain drugs and biologics that CMS reimburses under Medicare Part B and Part D. However, only high-expenditure single-source drugs that have been approved for at least 7 years (11 years for biologics) can be selected by CMS for negotiation, with the negotiated price taking effect two years after the selection year. The negotiated prices, which will first become effective in 2026, will be capped at a statutory ceiling price. Beginning in January 2023 for Medicare Part B and October 2022out-of-pocket spending cap for Medicare Part D beneficiaries from $7,050 to $2,000 starting in 2025, thereby effectively eliminating the IRA will also, penalize drug manufacturers that increase prices ofcoverage gap; impose new manufacturer financial liability on certain drugs under Medicare Part D, allow the U.S. government to negotiate Medicare Part B and Part D price caps for certain high-cost drugs atand biologics without generic or biosimilar competition; require companies to pay rebates to Medicare for certain drug prices that increase faster than inflation; and delay until January 1, 2032 the implementation of the HHS rebate rule that would have limited the fees that pharmacy benefit managers can charge. Further, under the IRA, orphan drugs are exempted from the Medicare drug price negotiation program, but only if they have one rare disease designation and for which the only approved indication is for that disease or condition. If a rate greater thanproduct receives multiple rare disease designations or has multiple approved indications, it may not qualify for the rateorphan drug exemption. The effects of inflation. the IRA on its business and the healthcare industry in general is not yet known.

The IRA permitsrequirements and process governing the conduct of clinical trials, including requirements to conduct additional clinical trials, product licensing, safety reporting, post-authorization requirements, marketing and promotion, interactions with healthcare professionals, pricing and reimbursement may vary widely from country to country. No action can be taken to market any product in a country until an appropriate approval application has been approved by the regulatory authorities in that country. The current approval process varies from country to country, and the time spent in gaining approval varies from that required for FDA approval. In certain countries, the sales price of a product must also be approved. The pricing review period often begins after market approval is granted. Even if a product is approved by a regulatory authority, satisfactory prices may not be approved for such product, which would make launch of such products commercially unfeasible in such countries.

Failure to comply with the requirements of the GDPR and the related national data protection laws of the EEA member states/UK may result in significant monetary fines for noncompliance of up to €20 million (£17.5 million for the UK) or 4% of the annual global revenues of the noncompliant company, whichever is greater, other administrative penalties and a number of criminal offenses (punishable by uncapped fines) for organizations and, in certain cases, their directors and officers, as well as civil liability claims from individuals whose personal data was processed. Data protection authorities from the different EEA member states/UK may still implement certain variations, enforce the GDPR and national data protection laws differently, and introduce additional national regulations and guidelines, which adds to the complexity of processing personal data subject to the EEA/UK data protection regimes. Guidance developed at both the EU level and at the national level in individual EU member states concerning implementation and compliance practices are often updated or otherwise revised.

The holder of an MA for a medicinal product must also comply with EU pharmacovigilance legislation and its related regulations and guidelines, which entail many requirements for conducting pharmacovigilance, or the assessment and monitoring of the safety of medicinal products.

In the EU, interactions between pharmaceutical companies and physicians are also governed by strict laws, regulations, industry self-regulation codes of conduct and physicians’ codes of professional conduct both at EU level and in the individual EU member states. The provision of benefits or advantages to physicians to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order or use of medicinal products is prohibited in the EU. The provision of benefits or advantages to physicians is also governed by the national anti-bribery laws of the EU member states. Violation of these provisions through guidance,laws could result in substantial fines and imprisonment.

The UK formally left the EU on January 31, 2020, and EU laws now only apply to the UK in respect to Northern Ireland as opposed to regulation,laid out in the Protocol on Ireland and Northern Ireland and as amended by the Windsor Framework agreed by the UK and EU on February 27, 2023. Amongst other things, the Windsor Framework sets out a long-term set of arrangements for the initial years. Manufacturerssupply of medicines into Northern Ireland. From January 1, 2025, medicines will need to be approved and licensed on a UK-wide basis by the MHRA, with medicines using the same packaging and labelling across the UK. The EMA will have no role in approving or licensing new drugs for provision in Northern Ireland. The EU and the UK have agreed on a trade and cooperation agreement, which includes specific provisions concerning pharmaceuticals, which include the mutual recognition of cGMP, inspections of manufacturing facilities for medicinal products and cGMP documents issued, but does not provide for wholesale mutual recognition of UK and EU pharmaceutical regulations. At present, Great Britain has implemented EU legislation on the marketing, promotion and sale of medicinal products through the HMRs.

For other countries outside of the EU, such as countries in Eastern Europe, Latin America or Asia, the requirements governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country. In all cases, again, the clinical trials must be conducted in accordance with cGCP and the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki.

If we fail to comply with the IRAapplicable foreign regulatory requirements, we may be subject to, various penalties, including civil monetary penalties. The IRA also extends enhanced subsidiesamong other things, fines, suspension of clinical trials, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

Neurogene was founded on a passionate belief that innovation in gene therapy can bring treatment options to patients with complex neurological diseases—patients who are waiting with unmet needs and often overlooked. Our behaviors reflect our values and encompass how our teams work together with open minds, reimagining the future and advocating for individuals purchasing health insurance coverage in ACA marketplace through plan year 2025. These provisions willpatients and families to achieve our mission. Our vision is to turn devastating neurological diseases into treatable conditions and improve the lives of patients and their families. We are focused on building a corporate culture that nurtures innovation, creative problem solving and a strong sense of purpose with patient and caregiver mindsets at the forefront. Our core values include:

We cannot predict what healthcare reform initiatives may be adopted inseek to prioritize employee development and align employees’ goals with our vision, mission, and overall strategic direction. Our human capital resources objectives include, as applicable, identifying, recruiting, retaining, incentivizing and integrating our existing and additional employees. The principal purposes of our equity incentive plans are to attract, retain and motivate selected employees, consultants and directors through the future. However, we anticipate that Congress, state legislatures,granting of stock-based compensation awards and third-party payors may continue to review and assess alternative healthcare delivery and payment systems and may in the future propose and adopt legislation or policy changes or implementations effecting additional fundamental changes in the healthcare delivery system. We also expect ongoing initiatives to increase pressure on drug pricing. Any reduction in reimbursement from Medicare and other government programs may result in a similar reduction in payments from private payors.

Our reports filed or Aquinox Canada,furnished pursuant to an unrelated third party. On December 31, 2020, Neoleukin Corporation was merged into Neoleukin Therapeutics, Inc.

Item 1A. Risk Factors

Summary of Risk Factors

Risks Related to Strategic ProcessNeurogene’s Limited Operating History, Financial Position and Potential Strategic TransactionCapital Requirements

Developing biotechnology products is a long, time-consuming, expensive and uncertain process that takes years to complete. Since our inception, we have funded our operations primarily through private financings and have incurred significant recurring losses, including net losses of $36.3 million and $55.2 million for the years ended December 31, 2023 and 2022, respectively. We expect our expenses to increase in connection with our ongoing activities, particularly as we continue to conduct a Phase 1/2 clinical trial of NGN-401 in patients with Rett syndrome and a Phase 1/2 clinical trial of NGN-101 in patients with CLN5 Batten disease, with the expectation that we will also initiate additional clinical trials in the future, and continue to research, develop and conduct preclinical studies of our other potential product candidates. In addition, if we obtain regulatory approval for any product candidate for commercial sale, including NGN-401 and NGN-101, we anticipate incurring significant commercialization expenses related to product manufacturing, marketing, sales and distribution activities to launch any such product. Our expenses could increase beyond expectations if we are required by the FDA or other regulatory agencies to perform preclinical studies or clinical trials in addition to those that we currently anticipate. Because the design and outcome of our current, planned and anticipated clinical trials are highly uncertain, we cannot reasonably estimate the actual amount of funding that will be necessary to successfully complete the development and commercialization of any product candidate we develop. Our future capital requirements depend on many factors, including factors that are not within our control.

The development and commercialization of biological products is highly competitive. If approved, NGN-401 and NGN-101 or other product candidates will face significant competition and our failure to effectively compete may prevent us from achieving significant market penetration. We compete with a variety of multinational biopharmaceutical companies, specialized biotechnology companies and emerging biotechnology companies, as well as academic institutions, governmental agencies, and public and private research institutions, among others. Many of the companies with which we are currently competing or will compete against in the future 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. Mergers and acquisitions in the pharmaceutical and biotechnology industry may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, NGN-401 and NGN-101 or other product candidates.

Any product candidates that we have are in the early stages of development efforts. We have no products on the market and NGN-401 and NGN-101 are in the early stages of clinical development, while our other programs are in early stages of preclinical development. As a result, we have elected to discontinue development of NL-201,expect it will be many years before we have suspended development of allcommercialize these product candidates and ultimately may not be successful in commercializing any of our remainingproduct candidates. Our ability to achieve and sustain profitability depends on obtaining regulatory approvals for, and successfully commercializing, our lead product candidate NGN-401 or other product candidates, which are still in drug discovery stages,including NGN-101, either alone or with third parties, and we may notcannot guarantee that we will ever obtain regulatory approval for any of our product candidates. We have limited experience as a company in conducting and managing the clinical trials necessary to obtain regulatory approvals, including approval by the FDA or comparable foreign regulatory authorities. We have not yet demonstrated our ability to obtain regulatory approvals, manufacture a commercial scale product or arrange for a third party to do so on our behalf, or conduct sales and have significantly reduced our clinical trial team in connection with the discontinuation of development of NL-201.marketing activities necessary for successful product commercialization. Before obtaining regulatory approval for the commercial distribution of any future product candidates, we or an existing or future collaborator must conduct extensive preclinical tests and clinical trials to demonstrate the safety, purity and efficacy or potency in humans of such product candidates.

Our current approach is to second- or third-line patients,identify, develop and that if thosecommercialize gene therapy product candidates proveusing an AAV9 capsid for delivery of therapeutic transgenes to certain kinds of cells.

A key part of our business strategy is to identify and develop additional product candidates. As such, our future success depends on the successful development of novel therapeutic approaches, including by utilizing our EXACT technology or other gene regulation technology. Our preclinical research and clinical trials may initially show promise in identifying potential product candidates, yet fail to yield product candidates for a number of reasons. For example, although EXACT is designed to deliver therapeutic levels of transgene while avoiding off-target effects, there can be no assurance that any EXACT gene regulation will result in product candidates that are shown in clinical trials to be sufficiently beneficialsafe, pure, and effective or potent.

Our future success is substantially dependent on our ability to timely obtain marketing approval for, and then successfully commercialize, our most advanced product candidates, NGN-401 and NGN-101. We are investing a majority of our efforts and financial resources into the research and development of these candidates. We are conducting a Phase 1/2 clinical trial of NGN-401 in patients with Rett syndrome and a Phase 1/2 clinical trial of NGN-101 in patients with CLN5 Batten disease. If topline results from our Phase 1/2 clinical trial of NGN-401 are successful, we anticipate initiating a pivotal clinical trial, pending future regulatory feedback on various aspects of development such as the pivotal trial design and manufacturing related requirements. If topline results from our Phase 1/2 clinical trial of NGN-101 are successful, we anticipate initiating a pivotal clinical trial or expanding the current Phase 1/2 clinical trial, pending future regulatory feedback on various aspects of development, such as the Phase 3 clinical trial design and manufacturing related requirements.

The discovery and development of therapeutics for patients with neurological diseases is an emerging field, and the scientific discoveries that form the basis for our efforts to discover and develop product candidates are relatively new. The scientific evidence to support the feasibility of developing product candidates based on these discoveries is both preliminary and limited. Although we believe, based on our abilitypreclinical work, that our programs have the potential to be disease-modifying therapies, clinical results may not confirm this hypothesis or may only confirm it for certain alterations or certain indications. The patient populations for our product candidates are limited to those with specific neurological diseases. We cannot be certain that the patient populations for each specific disease will be large enough to allow us to successfully obtain regulatory approval of, and then successfully launch and commercialize our product candidates. We have investedcandidates and achieve profitability. Further, both our Phase 1/2 clinical trial of NGN-401 and Phase 1/2 clinical trial of NGN-101 will involve a significant portion of our efforts and financial resources in the development of advanced computational algorithms and other methods, including machine learning for the design of functional de novo proteins with an initial focus on key cytokine mimetics, which we refer to as Neoleukin de novo cytokine mimetics. In the fourth quarter of 2022, based on a reviewsmall patient population. Because of the preliminary data,small sample sizes, the expected benefit to risk ratio for patients, and recent developments in the fieldresults of IL-2 therapeutics, we made a strategic decision to discontinue development for our lead product candidate, NL-201, and undertake a corporate restructuring to focus investment on the next generation of de novo protein design. As a result, all product candidates we have pursued in recent months are in early stages of development. In March 2023, our Board of Directors approved a further restructuring of the Company which resulted in the near term suspension of all research and development activities to focus on a review of strategic alternatives. Our ability to generate commercial product revenues, which we do not expect will occur for many years, if ever, will depend heavily on the successful development and eventual commercialization of our product candidates. If we are able to bring any of our product candidates to clinical trial, theythese trials may not be successful in those trials or, even if they are, they may not receive regulatory approval in a timely manner, or at all. Regulatory agencies, such as an FDA Advisory Committee or similar authority, may recommend non-approval or place restrictions on approval, which may also increase costs and delay commercialization. In addition, we may experience delays or rejections based upon additional government regulation from future legislation or administrative action, or changes in regulatory authority policy during the periodindicative of product development, clinical trials, and the review process. For example, the Oncology Centerresults of Excellence within the FDA has recently advanced Project Optimus, which is an initiative to reform the dose optimization and dose selection paradigm in oncology drug development to emphasize selection of an optimal dose, which maximizes not only the efficacy of a drug but the safety and tolerability as well. This may require sponsors to spend additional time and resources to further explore a product candidate’s dose-response relationship to facilitate optimum dose selection. Other recent Oncology Center of Excellence initiatives include Project FrontRunner, a framework for identifying candidate drugs for initial clinical development in the earlier lines of therapies rather than only after exhausting available treatment options. We are considering these policy changes as they relate to our programs.

From time to time, we estimate the timing of the anticipated accomplishment of various scientific, clinical, regulatory and other product development goals, which we sometimes refer to as milestones. These milestones may include the commencement or completion of scientific studies and clinical trials and the submission of regulatory filings. From time to time, we may publicly announce the expected timing of some of these milestones. All of these milestones are and will be based on numerous assumptions. The actual timing of these milestones can vary dramatically compared to our estimates, in some cases for reasons beyond our control. If we do not meet these milestones as publicly announced, or at all, the commercialization of our productsNGN-401 or NGN-101 or any other product candidates may be delayed or never achieved and, as a result, our stock price may decline.

Before obtaining marketing approval from regulatory authorities for the sale of any product candidate, we must complete preclinical studies, which are a lengthy, time consuming and expensive process with risk of high failure. The length of time of such testing may vary substantially according to the type, complexity and novelty of the program, and often can be several years or more per program. Delays associated with programs for which we are conducting preclinical testing and studies may cause us to incur additional operating expenses. However, after conducting preclinical studies, we must then conduct extensive clinical trials to demonstrate the safety, purity, and efficacy or potency of our product candidates.