UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended December 31, 2022

For the transition period from to

Commission File No. 001-37627

WAVE LIFE SCIENCES LTD.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: +65 6236 3388

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

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 ☐ No ☒

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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. Yes ☒ No ☐

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 ☒ No ☐

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 accelerated filer,’’ ‘‘accelerated filer,’’ ‘‘smaller reporting company,’’ and ‘‘emerging growth 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. ☐

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. ☐

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Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the registrant’s voting and non-voting ordinary shares held by non-affiliates of the registrant (without admitting that any person whose shares are not included in such calculation is an affiliate) computed by reference to the price at which the ordinary shares were last sold as of the last business day of the registrant’s most recently completed second fiscal quarter (June 30, 2022) was $205,332,422.
 

The number of outstanding ordinary shares of the registrant as of March 10, 2023 was 98,104,844.

DOCUMENTS INCORPORATED BY REFERENCE

WAVE LIFE SCIENCES LTD.

ANNUAL REPORT ON FORM 10-K

TABLE OF CONTENTS

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Special Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that relate to future events or to our future operations or financial performance. Any forward-looking statement involves known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statement. In some cases, forward-looking statements are identified by the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “future,” “goals,” “intend,” “likely,” “may,” “might,” “ongoing,” “objective,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “strategy,” “target,” “will” and “would” or the negative of these terms, or other comparable terminology intended to identify statements about the future, although not all forward-looking statements contain these identifying words. Forward-looking statements include statements, other than statements of historical fact, about, among other things: our ability to fund our future operations; our financial position, revenues, costs, expenses, uses of cash and capital requirements; our need for additional financing or the period for which our existing cash resources will be sufficient to meet our operating requirements; the success, progress, number, scope, cost, duration, timing or results of our research and development activities, preclinical studies and clinical trials, including the timing for initiation or completion of or availability of results from any preclinical studies and clinical trials or for submission, review or approval of any regulatory filing; the timing of, and our ability to, obtain and maintain regulatory approvals for any of our product candidates; the potential benefits that may be derived from any of our product candidates; our strategies, prospects, plans, goals, expectations, forecasts or objectives; the success of our collaborations with third parties; any payment that our collaboration partners may make to us; our ability to identify and develop new product candidates; our intellectual property position; our commercialization, marketing and manufacturing capabilities and strategy; our ability to develop sales and marketing capabilities; our estimates regarding future expenses and needs for additional financing; our ability to identify, recruit and retain key personnel; our financial performance; developments and projections relating to our competitors in the industry; our liquidity and working capital requirements; the expected impact of new accounting standards; and our expectations regarding the impact of the coronavirus (“COVID-19”), and variants thereof, on our business, including our research and development activities, preclinical studies and clinical trials, supply of drug product, and our workforce.

Although we believe that we have a reasonable basis for each forward-looking statement contained in this report, we caution you that these statements are based on our estimates or projections of the future that are subject to known and unknown risks and uncertainties and other important factors that may cause our actual results, level of activity, performance or achievements expressed or implied by any forward-looking statement to differ. These risks, uncertainties and other factors include, among other things, the ability of our preclinical studies to produce data sufficient to support the filing of global clinical trial applications and the timing thereof; our ability to continue to build and maintain the company infrastructure and personnel needed to achieve our goals; the clinical results and timing of our programs, which may not support further development of our product candidates; actions of regulatory agencies, which may affect the initiation, timing and progress of clinical trials; our effectiveness in managing current and future clinical trials and regulatory processes; the success of our platform in identifying viable candidates; the continued development and acceptance of nucleic acid therapeutics as a class of drugs; our ability to demonstrate the therapeutic benefits of our stereopure candidates in clinical trials, including our ability to develop candidates across multiple therapeutic modalities; our ability to obtain, maintain and protect intellectual property; our ability to enforce our patents against infringers and defend our patent portfolio against challenges from third parties; our ability to fund our operations and to raise additional capital as needed; competition from others developing therapies for similar uses; the severity and duration of the COVID-19 pandemic; the COVID-19 pandemic, and variants thereof, may negatively impact the conduct of, and the timing of enrollment, completion and reporting with respect to, our clinical trials; any other impacts on our business as a result of or related to the COVID-19 pandemic; any impacts on our business of the conflict involving Russia and Ukraine, global economic uncertainty, rising inflation, rising interest rates or market disruptions on our business; and our critical accounting policies, as well as other risks and uncertainties under the “Risk Factors” section of this Annual Report on Form 10-K and in other filings we make with the Securities and Exchange Commission (“SEC”).

Each forward-looking statement contained in this report is based on a combination of facts and factors currently known by us and our expectations of the future, about which we cannot be certain.

As a result of these factors, we cannot assure you that the forward-looking statements in this Annual Report on Form 10-K will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, these statements should not be regarded as representations or warranties by us or any other person that we will achieve our objectives and plans in any specified timeframe, or at all. We caution you not to place undue reliance on any forward-looking statement.

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In addition, any forward-looking statement in this report represents our views only as of the date of this report and should not be relied upon as representing our views as of any subsequent date. We anticipate that subsequent events and developments may cause our views to change. Although we may elect to update these forward-looking statements publicly at some point in the future, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.

As used in this Annual Report on Form 10-K, unless otherwise stated or the context otherwise indicates, references to “Wave,” the “Company,” “we,” “our,” “us” or similar terms refer to Wave Life Sciences Ltd. and our wholly-owned subsidiaries.

The Wave Life Sciences Ltd. and Wave Life Sciences Pte. Ltd. names, the Wave Life Sciences mark, PRISM and the other registered and pending trademarks, trade names and service marks of Wave Life Sciences Ltd. appearing in this Annual Report on Form 10-K are the property of Wave Life Sciences Ltd. This Annual Report on Form 10-K also contains additional trade names, trademarks and service marks belonging to Wave Life Sciences Ltd. and to other companies. We do not intend our use or display of other parties’ trademarks, trade names or service marks to imply, and such use or display should not be construed to imply, a relationship with, or endorsement or sponsorship of us by, these other parties. Solely for convenience, the trademarks and trade names in this Annual Report on Form 10-K are referred to without the ® and ™ symbols, but such reference should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto.

Summary of Risk Factors

We are providing the following summary of the risk factors contained in this Annual Report on Form 10-K to enhance the readability and accessibility of our risk factor disclosures. We encourage you to carefully review the full risk factors contained in this Annual Report on Form 10-K in their entirety for additional information regarding the material factors that make an investment in our securities speculative or risky. These risks and uncertainties include, but are not limited to, the following:

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PART I

Item 1. Business

Overview

We are a clinical-stage genetic medicines company committed to delivering life-changing treatments for people battling devastating diseases. Using PRISM, our proprietary discovery and drug development platform that enables the precise design, optimization, and production of novel stereopure oligonucleotides, we are working to develop first-or best-in-class medicines that target the transcriptome (the full set of ribonucleic acid, or “RNA,” molecules produced from the human genome) to treat genetically defined diseases with a high degree of unmet need.

Our RNA-targeting oligonucleotides are designed to correct disease-causing mutations, modulate protein activity, restore the production of functional proteins or reduce the expression of disease-promoting RNAs or proteins. Data from our ongoing clinical and preclinical studies has demonstrated significant improvements in potency, durability, and distribution for our oligonucleotides designed through PRISM, compared with competitor chemistries. These data support our platform as best-in-class for designing and optimizing RNA-targeting medicines.

Since our inception, we have seen the value of developing RNA-targeting medicines compared to other nucleic acid therapeutics, including gene therapy and DNA editing. By intervening at the RNA level, we have the potential to address diseases that have historically been difficult to treat with small molecules or biologics, while retaining the ability to titrate dose, modulate duration of effect, and avoid risk of permanent off-target genetic changes and other challenges associated with DNA editing or gene therapy approaches. Oligonucleotides have additional advantages as a therapeutic class, including the ability to access multiple tissue types and the ability to modulate the frequency of dosing to ensure broad distribution within tissues over time. Oligonucleotides also have well-established manufacturing processes and validated test methods based on decades of improvements, as well as established regulatory, access, and reimbursement pathways.

Our approach is based on the scientific insight that the biological machinery necessary to address genetic diseases already exists in human cells and can be harnessed for therapeutic purposes with the right tools. We have built a versatile platform comprised of multiple therapeutic modalities, which provides flexibility to design built-for-purpose molecules that optimally address disease biology. These modalities are RNA base editing, splicing, and silencing, including both RNA interference (“RNAi”) and antisense, all of which incorporate proprietary and novel chemistries to optimize the pharmacological properties of our therapeutic oligonucleotides.

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We have a robust and diverse pipeline of potential first-or best-in-class programs. Our lead programs are designed to treat genetic diseases, including those in muscle, including Duchenne muscular dystrophy (“DMD”); liver, including alpha-1 antitrypsin deficiency (“AATD”); and the central nervous system (“CNS”), including Huntington’s disease (“HD”), amyotrophic lateral sclerosis (“ALS”) and frontotemporal dementia (“FTD”). These programs include:

Over the last several years, we have built a leading RNA base editing capability. Our A-to-I RNA base editing oligonucleotides (“AIMers”) enable access to areas of disease biology that are not viable for other therapeutic modalities. Our editing capability affords us the dexterity to address both rare diseases, as well as diseases impacting large patient populations.

AIMers are designed to target single bases on an RNA transcript and recruit proteins that exist in the body, called ADAR (adenosine deaminases acting on RNA) enzymes, which naturally possess the ability to change an adenine (A) to an inosine (I), which cells read as guanine (G). This approach enables both the correction of G-to-A point mutations, as well as the modulation of RNA to upregulate protein expression, modify protein-protein interactions, or alter RNA folding and processing. AIMers enable simplified delivery and avoid the risk of permanent changes to the genome and irreversible off-target effects with DNA-targeting approaches. AIMers are short in length, fully chemically modified, and use novel chemistry, including proprietary PN backbone modifications and chiral control, which make them distinct from other ADAR-mediated editing approaches.

Our PRISM platform was built on the recognition that a significant opportunity exists to tune the pharmacological properties of oligonucleotide therapeutics by leveraging three key features of these molecules: sequence, chemistry, and stereochemistry. Our unique ability to control stereochemistry provides the resolution necessary to optimize pharmacological profiles and develop and manufacture stereopure oligonucleotides. Stereopure oligonucleotides are comprised of molecules with atoms precisely and purposefully arranged in three-dimensional orientations at each linkage. These differ from the mixture-based oligonucleotides currently on the market or in development by others. Additionally, to mitigate pharmacological risks and potential manufacturing challenges, our approach focuses on designing short, chemically modified oligonucleotides without the need for complex delivery vehicles. We have also established and continue to enhance our internal cGMP (current good manufacturing practices) manufacturing capabilities to increase control and visibility of our drug substance supply chain, while continuing to innovate oligonucleotide manufacturing.

PRISM also incorporates our novel, proprietary PN backbone chemistry modifications, which have been shown preclinically and clinically to increase potency, distribution, and durability of effect across our various modalities. PN chemistry is incorporated in all of our current clinical, preclinical and discovery-stage programs.

In December 2022, we announced a strategic collaboration with GSK to advance transformative oligonucleotide therapeutics, including WVE-006. The collaboration combines GSK’s unique insights in human genetics, as well as its global development and commercial capabilities, with our PRISM platform and oligonucleotide expertise. The collaboration will enable us to continue building a pipeline of first-in-class oligonucleotide-based therapeutics and unlock new areas of disease biology, as well as realize the full value of WVE-006 as a potential best-in-class treatment for AATD that has the potential to simultaneously address both liver and lung manifestations of the disease.

The GSK collaboration has three components:

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Our Current Programs

Additional details regarding our lead therapeutic programs are set forth below.

Duchenne muscular dystrophy (“DMD”)

In DMD, we are advancing WVE-N531, which is designed to skip exon 53 within the dystrophin gene – a therapeutic approach that would address approximately 8-10% of DMD cases. WVE-N531 is designed to cause the cellular splicing machinery to skip over this exon during pre-mRNA processing, which restores the dystrophin mRNA reading frame and enables production of truncated, but functional, dystrophin protein. Exon skipping produces dystrophin from the endogenous dystrophin gene (not micro or mini dystrophin expressed from a vector), under the control of native gene-regulatory elements, resulting in normal expression. WVE-N531 is both our first splicing candidate and our first systemically administered candidate incorporating PN chemistry to be assessed in the clinic.

In December 2022 (data cut-off: December 6, 2022), we announced a positive update from Part A of the Phase 1b/2a proof-of-concept study of WVE-N531 in three boys with DMD amenable to exon 53 skipping. High muscle concentrations of WVE-N531 and exon skipping were observed six weeks after initiating biweekly multi-dosing at 10 mg/kg, achieving proof-of-concept in the study. WVE-N531 also appeared safe and well-tolerated.

To evaluate dystrophin protein restoration, we are initiating the Phase 2 portion of the WVE-N531 open-label study (“Part B”), and plan to enroll up to ten boys. Boys will be dosed at 10 mg/kg biweekly, and we plan to assess dystrophin protein after 24 and 48 weeks of dosing. The primary endpoint will be dystrophin protein levels, and the study will also evaluate pharmacokinetics, functional endpoints and safety and tolerability. We expect to initiate dosing in 2023 and to deliver data in 2024. Based on results from this study, we would consider advancing a broader DMD pipeline with PN-modified splicing oligonucleotides for skipping other exons, with the goal of providing new treatment options for a larger population of boys with DMD.

Alpha-1 antitrypsin deficiency (“AATD”)

Our AATD program is the first to leverage our novel RNA editing capability and uses clinically proven N-acetylgalactosamine (“GalNAc”)-conjugated AIMers with subcutaneous dosing. By correcting the single RNA base mutation that causes a majority of AATD cases with the Pi*ZZ phenotype (approximately 200,000 in the U.S. and Europe), RNA editing may provide an ideal approach for increasing circulating levels of wild-type AAT protein and reducing mutant protein aggregation in the liver, thus simultaneously addressing both the lung and liver manifestations of the disease.

In the third quarter of 2022, we announced WVE-006 as our development candidate for AATD. WVE-006 is first-in-class in AATD and is the most advanced program currently in development using an oligonucleotide to harness an endogenous enzyme for RNA editing. WVE-006 is currently in IND-enabling studies, and we expect to submit clinical trial applications (CTAs) in the second half

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of 2023. Additionally, under the GSK collaboration, GSK received the exclusive global license for WVE-006, with clinical development and commercial responsibilities transitioning to GSK after we complete the first clinical trial. Under the terms of the collaboration, we are eligible to receive up to $525 million in development, launch and sales-related milestones, as well as double-digit tiered royalties as a percentage of net sales up to the high teens, for WVE-006.

Preclinical data show that treatment with WVE-006 resulted in approximately 50% RNA editing of SERPINA1 transcript and approximately 7-fold greater AAT protein levels (well above the predicted protective threshold of 11uM) at 13 weeks in an established AATD mouse model (NSG-PiZ). WVE-006 also led to restoration of approximately 50% wild-type M-AAT protein in serum and a 3-fold increase in neutrophil elastase inhibition activity, indicating that the restored M-AAT protein was functional. Wave’s AATD AIMers are highly specific to SERPINA1 RNA in vitro and in vivo based on transcriptome-wide analyses.

If we are successful in the clinic with WVE-006, we will both validate our clinical approach to AATD, as well as validate the feasibility of RNA editing in humans.

Huntington’s disease (“HD”)

In HD, we are currently advancing WVE-003, a stereopure antisense oligonucleotide designed to selectively target an undisclosed single nucleotide polymorphism (“SNP”), “mHTT SNP3”, associated with the disease-causing mutant huntingtin (“mHTT”) mRNA transcript within the Huntingtin (“HTT”) gene. Approximately 40% of the HD population carries SNP3 according to published literature (Carroll et al., Molecular Therapy, 2011).

WVE-003 incorporates our novel PN chemistry, as well as learnings from our first-generation HD programs. Targeting mRNA with SNP3 allows us to lower expression of transcript from the mutant allele, while leaving the healthy transcript relatively intact, thereby preserving wild-type (healthy) huntingtin (“wtHTT”) protein, which is important for neuronal function. Our allele-selective approach may also enable us to address the pre-manifest, or asymptomatic, HD patient population in the future. In preclinical studies, WVE-003 showed dose-dependent and selective reduction of mHTT mRNA in vitro, as well as potent and durable knockdown of mHTT mRNA and protein in vivo in mouse models.

The SELECT-HD trial is a multicenter, randomized, double-blind, placebo-controlled Phase 1b/2a clinical trial to assess the safety and tolerability of intrathecally administered WVE-003 for patients with early manifest HD. Additional objectives include measurement of mHTT and wtHTT protein and exploratory pharmacokinetic, pharmacodynamic, clinical and magnetic resonance imaging (“MRI”) endpoints. The SELECT-HD trial is designed to be adaptive, with dose level and dosing frequency being guided by an independent committee.

In September 2022 (data cut-off: August 29, 2022), we announced a positive update from SELECT-HD driven by the observation of reductions in mHTT protein in cerebrospinal fluid (“CSF”) after study participants received either a single 30 or 60 mg dose of WVE-003. Additionally, wtHTT protein levels appeared consistent with allele-selectivity. Single doses (30 mg, 60 mg, and 90 mg) of WVE-003 appeared generally safe and well-tolerated. Based on the SELECT-HD data, we have adapted the trial to expand the single dose cohorts, and we expect to share additional single-dose biomarker and safety data in the first half of 2023.

C9orf72-associated amyotrophic lateral sclerosis and frontotemporal dementia (C9-ALS/FTD)

In ALS and FTD, we are advancing WVE-004, which uses our novel PN chemistry and preferentially targets the transcripts containing the hexanucleotide G4C2 expansion in the C9orf72 gene. Approximately 2,000 ALS patients and 10,000 FTD patients in the U.S. have this mutation in C9orf72. In C9 BAC transgenic mice, WVE-004 led to substantial reductions in repeat-containing C9orf72 transcripts and dipeptide repeat (“DPR”) proteins that are sustained for at least six months, without disrupting total C9orf72 protein expression.

The FOCUS-C9 trial is a global, multicenter, randomized, double-blind, placebo-controlled Phase 1b/2a clinical trial to assess the safety and tolerability of intrathecal doses of WVE-004 for patients with C9-ALS and/or C9-FTD. Additional objectives include measurement of poly(GP) proteins in the CSF, plasma and CSF pharmacokinetics, and exploratory biomarker and clinical endpoints. The FOCUS-C9 trial is designed to be adaptive with dose level and dosing frequency being guided by an independent committee.

In April 2022 (data cut-off: March 24, 2022), we announced a positive update from FOCUS-C9 driven by the observation of potent and durable reductions of poly(GP) dipeptide repeat proteins in CSF, a C9-ALS/C9-FTD disease biomarker that, when reduced in CSF, indicates WVE-004’s engagement of target in the brain and spinal cord. Based on the poly(GP) reduction data, the observation period for single dose cohorts was extended and additional patients were enrolled into the trial to further characterize the depth of knockdown, durability and longer-term safety profile. Additionally, we have initiated multi-dosing cohorts, starting at 10 mg monthly and moving through 10 mg quarterly based on the potency and durability of pharmacodynamic effects. Additional single and

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multidose data are expected in the first half of 2023. Additionally, an open-label extension trial for FOCUS-C9 participants was initiated in the fourth quarter of 2022 and is ongoing.

Discovery Pipeline:

We are working to pursue new targets across multiple disease areas, given preclinical data indicating our oligonucleotides can distribute to various tissues and cells without complex delivery vehicles. We are also focusing on targets that have been genetically validated and offer biomarkers for target engagement to enable early proof-of-concept in the clinic. We expect this research to result in multiple new programs with first-in-class potential being added to our pipeline over the next several years.

Our Strategy

We are building a fully integrated genetic medicines company by leveraging PRISM to design, develop and commercialize optimized disease-modifying medicines for indications with a high degree of unmet medical need. We have a robust and diverse pipeline of PN-modified, stereopure oligonucleotides, including programs using our editing, splicing, and silencing modalities. Our lead clinical programs are focused in, and aim to address, muscle diseases (DMD - splicing), hepatic diseases (AATD – RNA editing), and CNS diseases (HD, ALS and FTD - silencing). In addition to driving clinical and preclinical programs, we are continuously investing in PRISM to fully unlock the potential of our unique and expanding platform capabilities. Additionally, we are conducting discovery research on multiple targets where we have the potential to deliver first-in-class therapeutics, starting with RNA editing.

The key components of our strategy are as follows:

Oligonucleotides

Nucleic acid therapeutics, including oligonucleotides, are an innovative class of drugs that can modulate the function of target RNAs to ultimately affect the production of disease-associated proteins or prevent the accumulation of pathogenic RNA species, which are emerging as important factors in human disease. Oligonucleotides can regulate protein and RNA via several different molecular

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mechanisms. These mechanisms can be broadly categorized as RNA base editing; splicing, those that involve binding to the target RNA and modulating its function by promoting exon skipping; and silencing, those that promote degradation of the target RNA, including antisense and RNAi.

The unique capability of oligonucleotides to address a wide range of genomic targets that impact multiple therapeutic areas creates potentially significant market opportunities for us to develop molecules to treat a broad spectrum of human diseases, including diseases where no medicines currently exist or for which existing treatments are not optimal.

The investigational oligonucleotides we are currently developing employ the following molecular mechanisms:

Stereochemistry of Oligonucleotide Backbone Modifications Impacts Pharmacology

Oligonucleotides are comprised of a sequence of nucleotides—the building blocks of RNA and DNA—that are linked together by a backbone of chemical bonds. In nucleic acid molecules that have not been modified for therapeutic use, the nucleotides are linked by phosphodiester (“PO”) bonds. Such unmodified nucleic acid molecules are unsuitable for use as therapeutics because they are rapidly degraded, rapidly cleared by the kidneys and taken up poorly by targeted cells.

Backbone chemistry modifications such as the phosphorothioate (“PS”) modification, one of the most common backbone modifications used in oligonucleotides, can improve the stability, biodistribution and cellular uptake of oligonucleotides.

A consequence of introducing backbone modifications, such as PS modifications, into an oligonucleotide is that it also introduces a chiral center at each phosphorus, creating stereoisomers designated as either an “Sp” or “Rp” isomer. As shown below, these stereoisomers have identical chemical compositions but different three-dimensional arrangements of their atoms and consequently have different chemical and biological properties.

During traditional oligonucleotide synthesis, the isomeric configuration at each chiral backbone modification is random (either Rp or Sp), resulting in a complex mixture containing many stereoisomers (known as diastereomers). Using PS modifications as an example, each PS linkage introduces a chiral center, thereby doubling the number of stereoisomers in the product, so that a traditional preparation of a PS-containing oligonucleotide contains 2N stereoisomers, where N represents the number of PS modifications.

Stereoisomers can possess different chemical and pharmacological properties. For example, certain stereoisomers can drive the therapeutic effects of a drug while others can be less beneficial or can even contribute to undesirable side effects. The greater the variation among a drug’s constituent stereoisomers, the greater the potential to diminish the drug’s efficacy and safety when it is a complex mixture.

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Prior to the development of our technology, it was not possible to create stereopure oligonucleotides – molecules where the configuration of each chiral backbone linkage is precisely controlled during chemical synthesis. Moreover, because of the sheer number of stereoisomers present in a mixture, it would be impractical, if not impossible, to physically isolate the most therapeutically optimal stereoisomer from within a mixture. For these reasons, all chiral backbone-modified oligonucleotides currently on the market and in development by others are mixtures of many stereoisomers, which we believe are not optimized for stability, catalytic activity, efficacy or toxicity.

In small molecule therapeutics, U.S. regulators have long sought to eliminate the risks potentially posed by drug mixtures containing multiple stereoisomers. Since 1992, the FDA has recommended full molecular characterization of stereoisomers within small-molecule drug mixtures. Historically, it has not been possible to achieve such characterization for nucleic acid therapeutic drug mixtures, which can contain tens of thousands to millions of distinct pharmacological entities. Based on our published and ongoing clinical and preclinical studies, we believe that we can design and synthesize stereopure chemically modified oligonucleotides that demonstrate superior pharmacological properties compared with mixture-based oligonucleotides. We believe that PRISM has the potential to set a new industry standard for the molecular characterization of complex nucleic acid therapeutic drug mixtures.

We continue to develop new types of backbone modifications, other than PS and PN modifications, that can be chirally controlled with our technology.

PRISM: Our proprietary discovery and drug development platform

Through PRISM, our proprietary discovery and drug development platform, we have discovered and expect to continuously elaborate on the relationships between the chemical makeup of an oligonucleotide, including the three-dimensional orientation or arrangement of its atoms, and its pharmacology (i.e., stability of the drug, activity against the target, specificity for the target and safety of the molecule). For example, we realized the impact of our novel PN backbone chemistry in vivo in preclinical studies when we evaluated its impact in the context of an otherwise stereopure backbone (Kandasamy et al., 2022; doi: 10.1093/nar/gkac037, Kandasamy et al., 2022; doi: 10.1093/nar/gkac018). In addition, we have defined relationships between various 2’-sugar modifications to the nucleotide (such as methoxy, methoxyethyl, fluoro), and the chemistry and stereochemistry of the backbone that enhances oligonucleotide pharmacology, providing a potentially enhanced therapeutic profile.

Our rational process for designing stereopure oligonucleotides, which is based on the interplay among oligonucleotide sequence, chemistry and backbone stereochemistry, allows us to selectively optimize for the therapeutic modality in order to generate best-in-class oligonucleotides. With PRISM, we leverage the diversity created by backbone stereochemistry to expand the parameters that we explore to optimize oligonucleotides. Moreover, through continued exploration of these interactions using iterative analysis of in vitro and in vivo outcomes and machine learning-driven predictive modeling, we also continue to refine our design principles that we deploy across subsequent programs. We are using these ongoing discoveries to guide our drug development activities, which we believe will lead to medicines that are more specific, can be dosed at lower concentrations, less frequently, or some combination of these characteristics as well as with improved therapeutic profiles.

Advantages of Our Approach

We believe that PRISM is a significant advancement in the development of oligonucleotides. The advantages of our approach include:

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Our Proprietary Chemistry

Backbone Stereochemistry

In our foundational Nature Biotechnology paper (Iwamoto N, et al. Nature Biotechnol. 2017;35(9):845-851), we described our studies using our proprietary chemistry to design and synthesize stereopure oligonucleotides and oligonucleotide mixtures based on mipomersen. Mipomersen, an oligonucleotide containing 20 nucleotides and 19 PS modifications, is synthesized by traditional oligonucleotide chemistry; thus, it is a mixture of over 500,000 different stereoisomers (219 = 524,288). We rationally designed and synthesized individual stereoisomers of mipomersen, each having position-specific and distinct stereochemistry, and conducted studies comparing these defined stereoisomers with the mipomersen stereomixture. These and other preclinical studies have demonstrated that stereochemistry and pharmacology are directly related, and that by controlling stereochemistry, we can impact multiple aspects of pharmacology, including stability, catalytic activity, efficacy, specificity, and safety.

We have subsequently published multiple additional manuscripts that provide evidence that stereopure oligonucleotides can be developed to have superior pharmacology to stereorandom oligonucleotides. These manuscripts are listed below:

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PN Backbone Chemistry Modifications

Our initial investigations into backbone chemistry and stereochemistry on oligonucleotide pharmacology focused on the widely used PO and PS backbones because they are amenable to all oligonucleotide modalities. In 2020, we announced the introduction of PN backbone chemistry modifications (“PN”) to our repertoire of backbone modifications, which involve replacing a non-bridging oxygen atom with a nitrogen-containing moiety, as shown below.

We have incorporated these PN modifications – specifically phosphoryl guanidine – into oligonucleotide compounds. As with PS modifications, PN modifications are chiral, and we have the capacity to control PN backbone stereochemistry. Unlike PS modifications, PN modifications are neutral, meaning that the negative charge of the oligonucleotide is reduced with every PN modification added to the backbone. In preclinical experiments, we have demonstrated that judicious use of PN backbone chemistry modifications in stereopure oligonucleotides have generally increased potency, tissue exposure and durability of effect across our editing, splicing and silencing modalities.

PRISM Therapeutic Modality Types

Using PRISM, we have designed and optimized diverse sets of stereopure oligonucleotides, which allows us to characterize and compare the behavior of various stereoisomers. With each new target, we gain insight into how the interplay between sequence, chemistry, including 2’-modifications, backbone chemistry, and stereochemistry impacts activity, and we build these learnings into our future programs.

In the next section, we describe different therapeutic modalities for which we have used PRISM to optimize stereopure oligonucleotides and develop built-for-purpose candidates to optimally address disease biology.

RNA base editing

We have applied our PRISM platform to the generation of short, single-stranded, highly specific A-to-I (G) RNA-base editing oligonucleotides – called “AIMers”. Because our AIMers are relatively short and stable (fully chemically modified), we can leverage clinically proven GalNAc-mediated delivery to hepatocytes to further increase tissue uptake with subcutaneous dosing. We are developing fully chemically modified AIMers with and without GalNAc conjugation. In preclinical studies, we have evaluated thousands of AIMers, assessing a variety of sugar and base modifications, backbone chemistry and stereochemistry, and other parameters such as AIMer length to produce insight into the relationship between an AIMer’s structure and its ability to elicit RNA editing activity.

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With PRISM, we have generated stereopure AIMers, optimized for chemistry and stereochemistry, which promote RNA editing with endogenous adenosine deaminase acting on RNA (ADAR) enzymes in cellular models. As shown in the figure below, we show the activity of beta-actin-editing stereopure AIMers, with and without PN linkages, compared to a matched stereorandom AIMer (shown in black) in primary human hepatocytes. These AIMers are GalNAc conjugated to increase uptake in hepatocytes. The addition of PN chemistry substantially improves both potency and editing efficiency.

In our Nature Biotechnology paper (Monian P, et. al., 2022; doi.org/10.1038/s41587-022-01225-1), we demonstrated efficient RNA editing in vitro with our AIMers across a variety of cell lines, including non-human primate and human primary hepatocytes, as shown in the figures below. We observed potent, dose-dependent RNA editing with three chemically distinct stereopure AIMers (ACTB 1, ACTB 2, ACTB 3) via GalNAc-mediated uptake.

We next evaluated these same ACTB-editing AIMers in vivo in non-human primates (“NHPs”), and the results are shown in the figures below. For this study, we dosed NHPs subcutaneously once a day for five days. We took liver biopsy samples at baseline at two days and 45 days after the last dose to evaluate editing. We detected up to 50% editing two days after the last dose as compared to a baseline of 0% editing, as shown in the figure below on the left. These editing results were durable: we continued to see significant editing 45 days after the last dose. The pharmacokinetic data, shown in the figure below in the center, confirmed that a significant amount of AIMer was still detectable in the liver at that time. To assess off-target editing for the whole transcriptome, a mutation-calling software was used to call edit sites. From this analysis, we observed nominal off-target editing across the transcriptome. Sites

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where potential off-target editing occurred mapped predominantly to non-coding regions of the transcriptome and had either low read coverage in the analysis or occurred at low percentages of less than 10%, indicating that these are relatively rare events, as shown in the figure below on the right.

We have demonstrated potent (up to 65%) and durable (out to at least four months) editing of UGP2 mRNA in vivo in multiple regions of the CNS following a single unconjugated AIMer dose in a mouse model with human ADAR, as shown in the figure below.

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We have also observed productive editing beyond liver and CNS with unconjugated AIMers in multiple tissue types including the retina in mice (below top right), kidney, liver, lung and heart of NHPs (below bottom left), and human PBMCs in vitro (below bottom right).

We also observed potent, durable, and specific editing across multiple additional tissues following systemic administration of a single dose of an unconjugated UGP2 AIMer in mice. These additional tissues in mice include heart, kidney, lung, and spleen, as well as liver cells beyond hepatocytes.

The application of PRISM to RNA editing opens the door to therapeutic applications extending beyond precise correction of genetic mutations, including upregulation of expression, modification of protein function, or alteration of protein stability. To date, we have achieved in vivo proof-of-concept modulating protein-protein interactions and upregulating protein expression.

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To exemplify our ability to modulate protein-protein interactions using ADAR, we evaluated the well characterized KEAP1/NRF2 system. Through direct protein-protein interactions, KEAP1 negatively regulates the activity of NRF2 as an inducer of antioxidant gene expression. As a proof-of-concept experiment, we investigated if we could mimic the cellular stress response by using ADAR to edit individual amino acids at the protein-protein interaction interface between NRF2 and KEAP1 in vivo in mice. If these edits work as designed, we would expect to see downstream upregulation of the NRF2-dependent gene expression program even in the absence of cellular stressors. As shown below, treatment with AIMers resulted in increased expression of known downstream NRF2-dependent genes involved in the antioxidant response. Control treatment did not increase expression of any of the NRF2-dependent genes, indicating that AIMer treatment did not lead to NRF2-dependent gene expression changes through non-specific mechanisms such as increased cellular stress.

To exemplify our ability to upregulate protein expression levels using ADAR, we evaluated AIMers designed to modify regulatory elements in RNA that mediate protein-RNA or RNA-RNA interactions. Specific structural or sequence motifs that mediate these intermolecular interactions impact RNA processing and stability. As a proof-of-concept experiment, we investigated whether modification of these regulatory elements could increase protein expression in the mouse liver. If these edits work as designed, we would expect to see upregulation of both mRNA and protein. As shown below, treatment of mice with GalNAc-AIMers resulted in editing of the target mRNA in liver, increased levels of the transcript in liver, and increased serum protein levels one week after dosing. These data demonstrate that AIMers designed to edit protein-RNA or RNA-RNA interaction motifs can be applied to increase protein expression.

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Splicing

With PRISM, we have optimized stereopure oligonucleotides that promote efficient splicing in vitro, ex vivo, and in vivo to restore protein production. In our splicing programs, as with our other modalities, the sequence, chemistry and backbone stereochemistry of oligonucleotides impact their activity.

In our Nucleic Acids Research paper (Kandasamy et al., 2022; doi: 10.1093/nar/gkac018), we highlight the impact of PN chemistry on exon skipping. In one application from the paper, we plotted the in vitro skipping efficiency of compounds containing PS / PO backbone chemistry modifications, depicted in the graph below by the teal dots, which are rank-ordered from left-to-right based on their exon-skipping potency in human myoblasts. The more potent molecules are shifted upwards as they are restoring expression. The navy dots represent the impact of a few stereopure PN modifications in compounds with otherwise identical sequences and 2’-ribose chemical modifications. There is an overall shift upwards in activity among the PS / PO / PN compounds, representing a substantial potency gain in most cases.

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Moving in vivo, we demonstrated successful exon skipping in double knockout mice (“dKO”), which lack both utrophin and dystrophin and therefore develop a severe muscular dystrophy phenotype comparable to that observed in patients with DMD. In these mice, exon skipping correlated with dystrophin protein expression, and PN-modified oligonucleotides led to more exon skipping and dystrophin production in all muscles examined after six weeks of treatment (shown below, left). Exon skipping and dystrophin expression improvements correlated with improved serum biomarker profiles in the same mice (shown below, right). These results demonstrate the impact of the judicious placement of PN linkages – with no delivery vehicle or conjugate – which can significantly improve the pharmacological profiles for stereopure compounds.

Data adapted from Figure 8, Kandasamy et al., 2022; doi: 10.1093/nar/gkac018 (Stats: One-way ANOVA: *P<0.05, **P<0.01, ***P<0.001, ****P<0.0001)

Silencing – RNAi and RNase H-mediated degradation

Using PRISM, we can produce stereopure PN-modified oligonucleotides that promote potent and specific RNA transcript silencing activity in preclinical experiments.

RNAi: We have applied our stereopure PS and PN modifications to the RNAi modality using double-stranded siRNAs and demonstrated potent and durable silencing in vivo in transgenic mice. We once again leverage GalNAc to enhance delivery to liver hepatocytes. The data, shown below, illustrate a GalNAc-siRNA, with controlled stereochemistry and PN backbone chemistry, that led to remarkably durable transcript silencing in mice three months after a single dose, compared with mice treated with a siRNA

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based on state-of-the-art designs, where expression levels had recovered to control levels (left). The data below (middle and right) also highlight that siRNAs developed with PRISM show improved activity profiles because they support more Ago2 loading than controls.

Additionally, in our first in vivo non-GalNAc siRNA study, we demonstrated that our unconjugated siRNA constructs led to 70-90% APP silencing across six brain regions in mouse CNS at 8 weeks, following a single intracerebroventricular (ICV) dose.

RNase H-mediated degradation (antisense): In our Nucleic Acids Research paper (Kandasamy et al., 2022; doi: 10.1093/nar/gkac018), we illustrated the impact of PN backbone chemistry modifications for an RNase-H mediated silencing modality. In addition to the data reported in the paper, we have performed screens for identifying RNase H-targeting sequences in iCell neurons in vitro using free uptake. This screen was initially performed with stereopure molecules with PS and PO backbone chemistry modifications, and the oligonucleotides are rank-ordered from left to right according to their potency. Next, we performed a head-to-head comparison with molecules that contained the same sequence and the same 2’-ribose chemistry, but with the addition of PN chemistry at select locations in the backbone. The introduction of a few PN linkages significantly increases the potency of the vast majority of the stereopure PS / PO molecules, with ~80% of them yielding at least 75% knockdown. These results, shown below, suggest we are able to target sequence space that would otherwise be inaccessible.

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Moving in vivo, we have demonstrated potent silencing activity of multiple targets in the CNS of non-human primates with stereopure, PN-modified oligonucleotides. In the results shown below, non-human primates received a single 12 mg dose by intrathecal injection. This single dose led to substantial and widespread mRNA reduction in the CNS one month after administration.

Therapeutic Programs

Our clinical-stage therapeutic programs include a splicing program for protein restoration in muscle – WVE-N531 for DMD, and two silencing programs for indications in the CNS – WVE-003 for HD and WVE-004 for ALS / FTD. In 2022, we also selected a development candidate and initiated IND-enabling toxicology studies for our first RNA editing program, WVE-006, which leverages GalNAc-conjugated delivery for AATD.

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See below for more information on these programs and the diseases we are targeting.

Duchenne Muscular Dystrophy

Background and Market Opportunity

DMD is a rare, genetic progressive neuromuscular disorder caused by mutations in the dystrophin gene on the X chromosome that affects approximately one in 5,000 newborn boys around the world (approximately 20,000 new cases annually). The dystrophin protein is part of a protein complex called the dystrophin-associated protein complex that acts as an anchor, connecting each muscle cell’s structural framework with a lattice of proteins and other molecules outside the cell through the muscle cell membrane. The dystrophin-associated protein complex protects the muscle from injury during contraction and relaxation. Patients with DMD typically develop muscle weakness in the early years of life and become wheelchair-bound in their early teens. As the disease progresses, DMD patients typically develop respiratory, orthopedic, and cardiac complications. Cardiomyopathy and breathing difficulties usually begin by the age of 20, and few individuals with DMD live beyond their thirties.

Current Treatments

While there are approved therapies for DMD, there is no cure, and there continues to be significant unmet medical need. In most countries, corticosteroids are the standard drug therapy, which slows the progression of muscle weakness and delays loss of ambulation by two to three years. In February 2017, Emflaza (deflazacort) became the first corticosteroid in the United States approved by the FDA as a treatment for DMD patients older than five years of age.

In 2016, Sarepta Therapeutics’ Exondys 51™ (eteplirsen) received accelerated approval in the United States for the treatment of patients with DMD, who have a confirmed mutation of the dystrophin gene amenable to exon 51 skipping. Two drugs have received accelerated approval in the United States for DMD patients with a confirmed mutation of the dystrophin gene amenable to exon 53 skipping: Sarepta Therapeutics’ Vyondys 53™ (golodirsen) in 2019 and NS Pharma’s Viltepso™ (viltolarsen) in 2020. NS Pharma has also received Marketing Authorization for Viltepso in Japan. In 2021, Sarepta’s Amondys 45™ (casimersen) received accelerated approval for DMD patients with a mutation amenable to exon 45 skipping. According to U.S. accelerated approval guidelines, approval is based on a surrogate endpoint that is likely to predict clinical benefit, but no clinical benefit needs to be established at the time of FDA approval. No clinical benefit has yet been established for eteplirsen, golodirsen, viltolarsen, or casimersen. Thus, in accordance with the U.S. accelerated approval regulations, the FDA is requiring Sarepta to conduct clinical trials to verify and describe the clinical benefit of eteplirsen, golodirsen, and casimersen. Similarly, NS Pharma is required to conduct a clinical trial to verify and describe the clinical benefit of viltolarsen. If any of these confirmatory trials fail to verify clinical benefit, the FDA could initiate proceedings to withdraw approval of the respective drug(s).

In 2014, PTC Therapeutics’ Translarna™ (ataluren) was the first disease-modifying treatment to receive conditional approval by the European Medicines Agency (“EMA”) for the treatment of ambulatory DMD patients over 5 years of age who have a nonsense mutation (12% of DMD cases) in the dystrophin gene. In 2016, the EMA did not allow Translarna to convert to full marketing authorization; rather, it granted a renewal of the conditional approval. In 2018, EMA expanded the conditional approval for Translarna to include treatment of ambulatory DMD patients ≥2 years of age who have a nonsense mutation in the dystrophin gene. In June 2020, the EMA removed a statement from the summary of product characteristics (“SmPC”) for Translarna that “efficacy has not been demonstrated in non-ambulatory patients.”

Our DMD Program

WVE-N531: In DMD, we are advancing WVE-N531, which is designed to skip exon 53 within the dystrophin gene. WVE-N531 is designed to cause the cellular splicing machinery to skip over this exon during pre-mRNA processing, which restores the dystrophin mRNA reading frame and enables production of truncated, but functional dystrophin protein. Exon-skipping produces dystrophin from the endogenous dystrophin gene (not micro or mini dystrophin expressed from a vector), under the control of native gene-regulatory elements, resulting in normal temporospatial expression. WVE-N531 is both our first splicing candidate and our first systemically administered candidate incorporating PN chemistry to be assessed in the clinic.

WVE-N531 clinical trial: In December 2022 (data cut-off: December 6, 2022), we announced a positive update from Part A of the Phase 1b/2a proof-of-concept study for WVE-N531 in DMD. This was an open-label, intra-patient dose escalation clinical trial where three boys received single escalating doses of 1, 3, 6 and 10 mg/kg; in the multidose portion of the study, the same boys received three doses of 10 mg/kg every other week. A muscle biopsy was taken two weeks after the third and final dose (six weeks after the first dose).

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WVE-N531 resulted in a mean tissue concentration of 42 micrograms/gram (6.1 micromolar), and RNAscope results indicated WVE-N531 is reaching the nucleus in muscle cells. WVE-N531 resulted in mean exon skipping of 53% (range: 48-62%) as measured by RT-PCR. Mean dystrophin production was 0.27% of normal as measured by western blot, which was below the level of quantification (BLQ: 1%). While dystrophin was below the lower limit of detection, it is expected that dystrophin protein production would lag splicing of the RNA transcript. Plasma concentrations and other pharmacokinetic parameters following a single dose of 10 mg/kg demonstrate a half-life of 25 days. Adverse events were all mild, except for a COVID-19 infection of moderate intensity. There were no serious adverse events, no trends in labs, and no oligonucleotide class-related safety events.

Based on these data, we plan to initiate the Phase 2 portion of the WVE-N531 open-label study (“Part B”) to enroll up to ten boys to assess dystrophin protein restoration. Boys will be dosed at 10 mg/kg biweekly, and we plan to assess dystrophin protein after 24 and 48 weeks of dosing. The primary endpoint will be dystrophin protein levels, and the study will also evaluate pharmacokinetics, functional endpoints and safety and tolerability. We expect to initiate dosing in 2023 and to deliver data in 2024.

Preclinical data

In vitro, WVE-N531 induced dose-dependent exon 53 skipping up to 49% and dystrophin protein restoration up to 71% in DMD patient-derived myoblasts carrying a deletion of exons 45-52. In these experiments, cells were exposed to WVE-N531 at 0.1 µM-10 µM under gymnotic conditions. After four days of oligonucleotide treatment, efficiency at skipping exon 53 was determined by quantitative RT-PCR. After six days of oligonucleotide treatment, protein lysate was analyzed by western blot for dystrophin protein expression.

In NHPs, plasma and tissue concentrations of WVE-N531 were significantly higher than suvodirsen (our first-generation PS/PO). WVE-N531 concentrations in heart and diaphragm were substantially higher than skeletal muscle concentrations. We also observed higher plasma Cmax, AUC and Ctrough levels compared with suvodirsen.

To understand the effects of PN backbone chemistry modifications in vivo, we conducted a study in a dKO mouse model, which has a mutation in exon 23 leading to a lack of dystrophin, as well as a mutation leading to a lack of utrophin. We compared the effects of a PS/PO-containing molecule dosed at 150 mg/kg weekly to a PN-containing compound dosed at the same level, a PN-containing compound at 75 mg/kg every other week and a control group dosed with PBS. Other than the placement of the three PN backbone linkages, these molecules have the same sequence and chemistry. There is a significant increase in survival in those animals treated with PN containing compounds as compared with the other treatment groups. As shown in the figure below, both cohorts of mice receiving the PN-containing molecules (shown in dark blue and light green) had 100% survival at the time of study termination, with a median age of approximately 40 weeks. By comparison, the median survival for the mice receiving the PS/PO-containing molecule dosed at 150 mg/kg weekly was approximately 12 weeks and the dKO control animals that received PBS had a median survival of

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approximately seven weeks. These results were published in Nucleic Acids Research (Kandasamy et al., 2022; doi: 101.1093/nar/gkac018).

Alpha-1 Antitrypsin Deficiency

Background and Market Opportunity

We are leveraging our RNA editing platform capability to develop a potentially novel treatment for AATD. AATD is a rare, inherited genetic disorder that is commonly caused by a G-to-A point mutation in the SERPINA1 gene; this mutant allele is termed the Z allele. This mutation leads to misfolding and aggregation of alpha-1 antitrypsin (“AAT”) protein in hepatocytes and a lack of functional AAT in the lungs. People with AATD typically exhibit progressive lung damage, liver damage or both, leading to frequent hospitalizations and potentially terminal lung disease and/or liver disease. While the few approved therapies for AATD modestly increase circulating levels of AAT in those with the lung pathology, there are no approved therapies to address the liver pathology. Approximately 200,000 people in the United States and Europe are homozygous for the Z allele, which is the most common form of severe disease.

Current Treatments

There are five treatments currently approved in the United States for chronic augmentation and maintenance therapy in adults with emphysema due to congenital deficiency of alpha1-proteinase inhibitor (Alpha1-PI). Per FDA labeling for each, the effect of augmentation therapy with any alpha1-proteinase inhibitor on pulmonary exacerbations and on the progression of emphysema in Alpha1-PI deficiency has not been demonstrated in randomized, controlled clinical trials. Patients with AATD can also be treated with therapies used in other lung diseases including bronchodilators to open airways and corticosteroids to reduce chronic inflammation common in the lungs of AATD patients.

There are currently no approved therapies to prevent the accumulation of the misfolded AAT protein in the liver. Treatments are available to help deal with intestinal bleeding, fluid in the abdomen, nutritional issues, and other complications from scarring of the liver, but ultimately many patients will progress towards requiring a liver transplant.

Our AATD Program

Our AATD program is the first to leverage our novel RNA editing capability that uses GalNAc-conjugated AIMers (RNA base editing oligonucleotides) and endogenous ADAR enzymes by correcting a single base in the mutant SERPINA1 mRNA. ADAR editing may provide an ideal approach for increasing circulating levels of wild-type AAT protein and reducing aggregation in the liver, thus simultaneously addressing both the lung and liver manifestations of the disease. In the third quarter of 2022, we announced WVE-006 as our development candidate for AATD. WVE-006 is first-in-class in AATD and will be administered using subcutaneous administration. It is the most advanced program currently in development using an oligonucleotide to harness an endogenous enzyme for RNA base editing. WVE-006 is currently in IND-enabling studies and we expect to submit clinical trial applications in the second half of 2023.

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Preclinical data

Preclinical data for WVE-006 demonstrated that WVE-006 supports dose-dependent RNA editing in human preclinical model systems, as shown in the figure below. We observed efficient SERPINA1 editing in donor-derived primary human hepatocytes (MZ genotype) after 48 hours, as well as a dose-dependent increase in RNA editing in iPSC-derived human hepatocytes (ZZ genotype) eight days after a single dose.

In an in vivo preclinical study in NSG-PiZ mice, we demonstrated restoration of functional AAT protein with bi-weekly doses of 10 mg/kg. At 13 weeks, AAT protein levels with WVE-006 were approximately 7-fold greater than PBS-administered controls and well above the predicted protective threshold of 11 uM, as shown below (left). This increase was observed at week 13 both in mice that received a loading dose, as well as mice that did not. WVE-006 also resulted in approximately 50% RNA editing of SERPINA1 transcript at 13 weeks in this same model, regardless of whether a loading dose was used, as shown below (right).

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We then sought to determine whether the restored serum AAT protein from the mouse experiment described above was wild-type M-AAT protein. WVE-006 led to restoration of approximately 50% wild-type M-AAT protein in serum, as measured by mass spectrometry, as shown below (left), as well as a 3-fold increase in neutrophil elastase inhibition activity, as shown below (right), indicating the restored M-AAT protein was functional.

An earlier lead (pre-optimization) GalNAc-AIMer reduced Z-AAT aggregates and inflammation in mouse livers (mouse model: huADARxSA1), as indicated below.

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To evaluate the specificity of our GalNAc-AIMers (specifically “SA1-4 AIMer”), we performed RNA-seq on liver biopsies from treated animals. The figure below on the left shows total sequence coverage across the entire SERPINA1 transcript for the AIMer-treated samples. The percentage of unedited “T” and edited “C” reads are indicated for each group. Editing is only detected at the intended, on-target sequence in the SERPINA1 transcript. Thus, the protein being produced using this approach is truly wild-type M-AAT protein. This also confirms there is no editing of bystander residues, as has been seen with DNA targeting approaches. To assess off-target editing for the whole transcriptome, we applied a mutation-calling software to search edit sites. From this analysis, we observed minimal off-target editing across the transcriptome. Sites where potential off-target editing occurred had either low read coverage in the analysis or occurred at low percentages (less than 10%), indicating that these are rare events, as shown below on the right. In both analyses, we find a high percentage of editing that is specific for the target site in the SERPINA1 transcript.

Huntington’s Disease

Background and Market Opportunity

Huntington’s Disease (“HD”): HD is a rare hereditary neurodegenerative disease that results in early death and for which there is no cure. In HD patients, there is a progressive loss of neurons in the brain leading to cognitive, psychiatric, and motor disabilities. HD is caused by a defect (an expanded CAG triplet repeat) in the HTT gene, which results in production of mutant HTT (“mHTT”) protein. HD patients still possess some wild-type (healthy) HTT (“wtHTT”) protein, which is important for neuronal function, and which may

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be neuroprotective in an adult brain. Studies suggest a multifaceted mechanism by which gain of mHTT protein and a concurrent loss of wtHTT protein may drive the pathophysiology of HD. Accordingly, therapeutic approaches for HD that aim to lower mHTT but that also suppress wtHTT may have detrimental long-term consequences. Wild-type HTT is important both for normal neuronal function in the adult CNS and for protection against HD. It can protect against stress-induced neurodegeneration in multiple model systems: in cultured neurons, wtHTT is protective against stress-induced apoptosis; in mice, postnatal deletion of wtHTT leads to progressive neurological phenotypes, neurodegeneration, and premature death, whereas overexpression of wtHTT conveys neural protection during stress, including ischemia and other types of CNS injury, as well as NMDA-induced excitotoxicity. In the YAC128 mouse model of HD, overexpression of wtHTT ameliorates striatal neuropathology, whereas loss of the wild-type mouse HTT worsens motor performance, survival, and striatal neuronal size. In patients with HD, the A variant of a non-coding single nucleotide polymorphism (“SNP”) disrupts a binding site for the transcription factor NF-κB and decreases expression of the associated HTT gene: when the A variant associates with mHTT, disease onset is late (on average, 10-years later than when the G variant associates with mHTT); when the A variant associates with wtHTT, disease onset is earlier (on average, four years earlier than when the G variant associates with wtHTT), indicating that increased expression of wtHTT can be protective against HD in patients. Together, these studies provide evidence that wtHTT is both neural protective during stress and is specifically protective against HD; thus, we believe an allele-selective therapeutic, one that can diminish the production of mHTT while sparing wtHTT, may be ideal.

Symptoms of HD typically appear between the ages of 30 and 50 and worsen over the next 10 to 20 years. Many describe the symptoms of HD as similar to having amyotrophic lateral sclerosis, Parkinson’s Disease and Alzheimer’s Disease simultaneously. Patients experience a reduction in motor function and psychological disturbances. Life expectancy after symptom onset is approximately 20 years. In the most symptomatic stages, often lasting over 10 years, affected persons become fully dependent upon others to manage all activities of daily living; they lose the ability to make decisions, feed themselves and walk, and often require premature placement in a long-term care facility. It is estimated that approximately 30,000 people in the United States have symptomatic HD. Our allele-selective approach may also enable us to address the pre-manifest, or asymptomatic, HD patient population in the future. More than 200,000 people in the United States are at-risk of developing HD.

Current Treatments

There are no approved treatments that can reverse or slow HD progression. Current pharmacological therapies only address HD symptoms. Antipsychotics are used to manage depression, irritability, and chorea (involuntary movements). Xenazine (tetrabenazine) and Austedo (deutetrabenazine) are the only two therapies approved for the treatment of chorea associated with HD in the United States. In the EU, Xenazine, Haldol (haloperidol), and Tiapridal (tiapride) are approved for the treatment of chorea associated with HD.

Our HD Program

WVE-003: In HD, we are currently advancing WVE-003, a stereopure antisense oligonucleotide designed to selectively target an undisclosed SNP, “mHTT SNP3”, associated with the disease-causing mutant huntingtin (“mHTT”) mRNA transcript within the HTT gene. SNPs are naturally occurring variations within a given genetic sequence and in certain instances can be used to distinguish between two related copies of a gene where only one is associated with the expression of a disease-causing protein. Approximately 40% of the HD population carries SNP3 according to published literature (Carroll et al., Molecular Therapy, 2011). WVE-003 incorporates our novel PN chemistry, as well as learnings from our first-generation HD programs. Targeting mRNA with SNP3 allows us to lower expression of transcript from the mutant allele, while leaving the healthy transcript relatively intact. The healthy transcript produces wtHTT protein, which is important for neuronal function. We commonly refer to this method (or approach) as “allele-selective targeting.” Our allele-selective approach may also enable us to address the pre-manifest, or asymptomatic, HD patient population in the future.

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In preclinical studies, WVE-003 showed dose-dependent and selective reduction of mHTT mRNA in vitro, and potent and durable knockdown of mHTT mRNA and protein in vivo. A pharmacokinetic-pharmacodynamic (PK-PD) model for WVE-003 based on preclinical data predicts that WVE-003 may attain sufficient concentrations to engage mHTT transcript in both the cortex and striatum and decrease expression of mHTT protein.

SNP Phasing Technology: To verify that potential HD patients have a heterozygous SNP with the right variant in-phase with the mutant allele, we investigated multiple technologies that could provide highly accurate results and rapid turnaround. We conducted a prospective observational study of the frequency of two SNPs in patients with HD, which confirmed the feasibility of rapidly and prospectively identifying SNPs in association with the mHTT allele in patients with HD (Claassen et al., Neurol Genet 2020; Svrzikapa et al., Molecular Therapy 2020). We have an agreement with Asuragen, Inc. (“Asuragen”), a molecular diagnostics company that was acquired by Bio-Techne Corporation in April 2021, for the development and potential commercialization of companion diagnostics for our allele-selective therapeutic program in HD. This agreement includes the use of their scalable SNP phasing technology (AmplideX® HTT SNP/Repeat Phasing Clinical Trial Assay) in our SELECT-HD trial for WVE-003.

SELECT-HD Phase 1b/2a clinical trial: The SELECT-HD trial is a multicenter, randomized, double-blind, placebo-controlled Phase 1b/2a trial to assess the safety and tolerability of intrathecally administered WVE-003 for patients with early manifest HD. Additional objectives include measurement of CSF mHTT and wtHTT protein and exploratory pharmacokinetic, pharmacodynamic, clinical and MRI endpoints. The SELECT-HD trial is designed to be adaptive, with dose level and dosing frequency being guided by an independent committee. Preclinical models that have established pharmacologic activity have informed the starting dose for this trial.

In September 2022 (data cut-off: August 29, 2022), we announced a positive update from SELECT-HD, with initial results indicating allele-selective target engagement with WVE-003 in HD. Single doses of WVE-003 up to 90 mg appeared generally safe and well-tolerated. Among participants in the 30 and 60 mg WVE-003 cohorts, the mean reduction in CSF mHTT from baseline was 22% (median reduction 30%) at 85 days following a single dose. Participants in the 90 mg cohort had not yet reached day 85, so they were not included in the biomarker analysis. The difference in the mean reduction in CSF mHTT compared to placebo was 35% at 85 days post-single dose. For these analyses, the 30 and 60 mg single dose cohorts were pooled as there was no apparent dose response between these two cohorts. In the 30 and 60 mg cohorts, wtHTT protein levels appeared consistent with allele-selectivity. Increases in neurofilament light chain (“NfL”) from baseline were observed in some participants. There were no clinically meaningful elevations in CSF white blood cell counts or protein that would indicate inflammation in the CNS, and there were no meaningful changes in clinical outcome measures, although the dataset and duration were not sufficient to assess clinical effects.

Based on the SELECT-HD data, we have adapted the trial to expand the single dose cohorts and expect to share additional single-dose biomarker and safety data in the first half of 2023.

Preclinical studies

WVE-003 showed potent knockdown of HTT mRNA in a preclinical study using induced pluripotent stem cell (“iPSC”)-derived motor neurons homozygous for SNP3 (as shown below).

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WVE-003 promoted RNase H–mediated degradation of mHTT RNA while sparing wtHTT RNA in a biochemical assay.

We further demonstrated selectivity of WVE-003 in assays performed in induced pluripotent stem cell (iPSC) neurons from patients with HD that are heterozygous for SNP3. WVE-003 selectively silenced the mutant transcript while largely sparing the wild-type transcript. By comparison, the pan-silencing active comparator silenced both mutant and wild-type HTT transcripts.

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We next tested our SNP3 compounds in vivo in a BACHD model for HD. This model expresses a mutant version of the human HTT gene. Because it is a transgenic model that lacks human wtHTT, BACHD mice are not suitable for assessing selectivity, but they enable assessment of target engagement in vivo. Importantly, the model contains multiple copies of the human mHTT transgene; however, not all of the copies contain SNP3. Thus SNP3-targeting compounds cannot target all the human mHTT transcripts expressed in these mice. After administration, WVE-003 showed significant mHTT mRNA knockdown compared with phosphate-buffered saline (PBS) at the highest concentration tested in the striatum and all but the lowest concentration tested in the cortex. WVE-003 showed comparable reduction of mHTT mRNA to that of the pan-silencing oligonucleotide, despite having fewer targets in these mice.

In the cortex of BACHD mice, WVE-003 showed significant mHTT knockdown compared to PBS through week four. In the striatum, WVE-003 led to significant and durable mHTT knockdown that was sustained for 12 weeks, compared with PBS. WVE-003 led to significantly more knockdown than the pan-silencing reference compound at week 12 in the striatum. Since most but not all of the transgenes in this model contain SNP3, our SNP3 compounds are disadvantaged versus the pan-silencing active comparator.

In vivo allele-selectivity: We then tested in vivo allele-selectivity using an allele-selective mHTT SNP3 targeting oligonucleotide in a humanized mouse model (“Hu97/18”). The mice express a human YAC wtHTT transgene (with 18 CAG repeats) and a human BAC mHTT transgene (with 97 CAG repeats). The mice carry the SNP3 variant associated with the human mHTT allele, and they do not

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express mouse huntingtin. After administration (3 x 100 ug ICV doses), the allele-selective molecule decreased mHTT and spared wtHTT in the cortex, striatum, and hippocampus of Hu97/18 mice up to 12 weeks post-injection throughout the brain. By contrast a pan-silencing control decreased expression of both mHTT and wtHTT, and the silencing activity was both less potent and less durable than the allele-selective molecule, especially in the striatum.

Data are mean ± SD, n=8; Stats: ns non-significant, *P<0.05, **P<0.01, ***P<0.0001, ****P<0.0001 versus PBS by 1-way ANOVA

Amyotrophic Lateral Sclerosis and Frontotemporal Dementia

Hexanucleotide G4C2 expansions found in the C9orf72 gene are one of the most common genetic causes of the sporadic and inherited forms of Amyotrophic Lateral Sclerosis (ALS) and Frontotemporal Dementia (FTD). Some patients exhibit characteristics of both ALS and FTD, indicating that these diseases form part of a continuum of neurological disease with some overlap in symptoms between them.

ALS Background and Market Opportunity

ALS is a neurodegenerative disease characterized by the progression and degeneration of motor neurons in the brain and spinal cord. Diagnosis may take up to 12 months and is made clinically by assessing the signs of upper and lower motor neuron degeneration in the same region of the body. Patients initially present with limb-onset disease (approximately 70% of patients), bulbar-onset disease (approximately 25% of patients) or with initial trunk or respiratory involvement (approximately 5% of patients). Age of onset is generally in the mid-to-late 50s, and median survival is three years; however, up to 24% of patients survive for five to ten years. Survival in patients with C9orf72 ALS may be shorter than in patients with sporadic ALS.

In the United States and Europe combined, there are approximately three to five ALS patients per 100,000 people. This translates to approximately 13,000 diagnosed patients in the United States, although the total prevalence may be around 20,000 people in the United States. There are one or two newly diagnosed cases of ALS per year, per 100,000 people in the United States and Europe combined, resulting in approximately 5,000 newly diagnosed patients in the United States each year. While the majority of ALS cases

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are sporadic, approximately 10% of cases are found to be familial in nature. The C9orf72 gene mutation is currently the most common demonstrated mutation related to ALS and is present in approximately 40% of familial ALS and 8 – 10% of sporadic ALS patients.

ALS Current Treatments

There is significant unmet need for the treatment of ALS. Three medicines are currently approved in the United States for the treatment of ALS. Rilutek (riluzole), an inhibitor of glutamate release, was approved in 1995 for the treatment of patients with ALS. It was demonstrated to extend survival by three to six months. Radicava (edaravone) was approved in 2017 for the treatment of ALS. Administration of edaravone resulted in a significantly smaller decline in the ALS Functional Rating Scale-Revised (“ALSFRS-R”) through six months of treatment as compared to placebo. Relyvrio (sodium phenylbutyrate and taurursodiol) was approved in 2022 for the treatment of ALS. In a clinical trial, patients treated with Relyvrio scored on average 2.32 points higher than placebo on the ALSFRS-R after 6 months. A post-hoc exploratory survival analysis showed that patients originally randomized to Relyvrio had a 4.8 month longer median overall survival compared to those in the placebo group.

FTD Background and Market Opportunity

FTD is a neurodegenerative disorder of the frontal and anterior temporal lobes of the brain. It is characterized by changes in personality, cognition (e.g., language impairment and executive dysfunction), and behavior (e.g., disinhibition, apathy and compulsivity). Diagnostic criteria categorize FTD into either the behavioral variant (approximately 60% of patients) or speech/language variant (approximately 40% of patients) based on the primary symptom observed at presentation; however, FTD results in dementia in all patients. The majority of FTD associated with the G4C2 expansion in the C9orf72 gene is categorized as the behavioral variant. FTD frequently has an onset in mid-life, and death typically occurs within three to 14 years of onset. FTD is the second most common form of early-onset dementia in people under the age of 65, after AD.

In FTD, the C9orf72 gene mutations appear in approximately 38% of familial cases and approximately 6% of sporadic cases. FTD affects approximately 55,000 people in the United States, of which 10 – 50% are familial cases and 50 – 90% are sporadic cases.

FTD Current Treatments

There are currently no disease-modifying therapies approved for the treatment of FTD. Treatment to date has involved use of medications for symptomatic management.

C9-ALS and C9-FTD Pathology

Expansion of the G4C2 repeat alters the normal expression of the C9orf72 gene and causes the production of repeat-containing RNA sense and antisense variants. These RNAs accumulate in cellular nuclei in the form of RNA foci and can be translated into dipeptide repeat (“DPR”) proteins. Neuronal degeneration associated with the expression of the repeat expansion is hypothesized to arise either from a toxic loss-of-function mechanism due to a reduction in C9orf72 protein, a toxic RNA gain-of-function mechanism through the accumulation of RNA foci and/or DPRs accumulating in the brain and spinal cord, or both. WVE-004 is designed to affect multiple drivers of toxicity by preserving C9orf72 protein, thereby not exacerbating loss-of-function, and reducing the toxic gain-of-function drivers of disease – RNA foci and DPRs.

Our ALS and FTD Program

WVE-004: In ALS and FTD, we are advancing WVE-004, which uses our novel PN chemistry and preferentially targets the transcripts containing the hexanucleotide G4C2 expansion in the C9orf72 gene. WVE-004 is designed to minimize the impact on normal C9orf72 protein in patients, thereby reducing potential on-target risk. In vitro, WVE-004 potently and selectively reduced V3 transcripts in iPSC-derived motor neurons, which were derived from a patient carrying a C9orf72-repeat expansion. In C9 BAC transgenic mice, WVE-004 led to substantial reductions in repeat-containing C9orf72 transcripts and dipeptide repeat (“DPR”) proteins that are sustained for at least six months, without disrupting total C9orf72 protein expression.

FOCUS-C9 Phase 1b/2a clinical trial: The FOCUS-C9 trial is a global, multicenter, randomized, double-blind, placebo-controlled Phase 1b/2a clinical trial to assess the safety and tolerability of intrathecal doses of WVE-004 for patients with C9-ALS and/or C9-FTD. Additional objectives include measurement of poly(GP) proteins in the cerebrospinal fluid (“CSF”), plasma and CSF pharmacokinetics, and exploratory biomarker and clinical endpoints. The FOCUS-C9 trial is designed to be adaptive with dose level and dosing frequency being guided by an independent committee. Preclinical models that have established pharmacologic activity have informed the starting dose for this trial.

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In April 2022 (data cut-off: March 24, 2022), we announced a positive update from FOCUS-C9 driven by the observation of potent, durable reductions of poly(GP) dipeptide repeat proteins in CSF with low, single doses of WVE-004. Poly(GP) is a key C9-ALS/C9-FTD disease biomarker that, when reduced in CSF, indicates WVE-004’s engagement of target in the brain and spinal cord. In the initial data analysis, reductions in poly(GP) were observed across all active treatment groups (10 mg, n=2 patients; 30 mg, n=4 patients; 60 mg, n=3 patients), reaching statistical significance versus placebo (n=3 patients) after single 30 mg doses, with a 34% reduction in poly(GP) at day 85 (p=0.011). At the time of analysis, none of the patients dosed with 60 mg had reached day 85. Adverse events (“AEs”) were balanced across treatment groups, including placebo, and were mostly mild to moderate in intensity. Four patients (including one on placebo) experienced severe and/or serious adverse events; three were reported by the investigators to be related to ALS or administration, and one was reported by the investigator to be related to study drug. CSF NfL elevations were observed in some patients in the 30 mg and 60 mg single dose cohorts with no meaningful changes in clinical outcome measures, although the dataset and duration were not sufficient to assess clinical effects. There were no treatment-associated elevations in CSF white blood cell counts or protein and no other notable laboratory abnormalities were observed.

Based on the poly(GP) reduction data, the observation period for single dose cohorts was extended and additional patients were enrolled into the trial to further characterize depth of knockdown, durability and longer-term safety profile. We have also initiated multi-dosing cohorts starting at 10 mg monthly and moving through 10 mg quarterly, based on potency and durability of pharmacodynamic effects. Additional data are expected in the first half of 2023. An open-label extension trial for FOCUS-C9 participants was initiated in the fourth quarter of 2022 and is ongoing.

Preclinical studies

In our Nature Communications paper (Liu, Y et al. Nat Comms. 2021), we report the discovery of a new targeting sequence that is common to all C9orf72 transcripts but enables preferential knockdown of repeat-containing transcripts in multiple models and C9BAC transgenic mice. Wild-type C9orf72 alleles produce three mRNA transcripts: variant 1 (V1), variant (V2), and variant (V3). We apply our platform to generate stereopure oligonucleotides that target a sequence at the exon 1b-intron 1 junction, termed Splice Site-1b (“SS1b”), that is common to all C9orf72 transcripts (shown below in “b”, pre-mRNAs corresponding to V1-V3 are illustrated; the coral star indicates SS1b). In multiple in vitro model systems, an unoptimized stereopure oligonucleotide yields preferential knockdown of exon1a-containing transcripts. The Nature Communications paper describes our work to identify and validate the targeting site to achieve variant-selective knockdown of expansion-containing C9orf72 transcripts. The publication highlights the foundational work that led to the development of our clinical candidate.

By targeting the V1 and V3 mRNA transcripts that contain the G4C2 expansion and sparing V2 transcripts and healthy C9orf72 protein, WVE-004 has the potential to reduce both RNA-based and protein-based toxicity, thereby impacting the disease course and slowing the progression of ALS or FTD.

In 2022, we published preclinical data in support of WVE-004 in Molecular Therapy Nucleic Acids (doi: 10.1016/j.omtn.2022.04.007). The publication highlights work to demonstrate the potency and durability of effect for WVE-004, as well as its pharmacological properties and ability to preserve C9orf72 protein in C9 BAC transgenic mice. In vitro, WVE-004 potently and selectively reduced V3 transcripts in iPSC-derived motor neurons, which were derived from a patient carrying a C9orf72 repeat expansion.

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In C9 BAC transgenic mice, WVE-004 led to substantial reductions in repeat-containing C9orf72 transcripts and dipeptide repeat proteins that are sustained for at least six months, without disrupting total protein expression as shown below.

Spinocerebellar ataxia 3

Background and Market Opportunity

SCA3 is a rare, hereditary (autosomal dominant) progressive neurodegenerative disorder that results in a lack of muscle control and coordination of the upper and lower extremities. Signs and symptoms of SCA3 may begin between childhood and late adulthood and vary greatly. Symptoms may include progressive clumsiness in the arms and legs, spasticity, difficulty with gait, and impaired speaking, swallowing and eye movements. Symptoms of the disease worsen over time, eventually leading to paralysis. Some patients with SCA3 develop dystonia or symptoms similar to those of PD, including twitching of the face or tongue, and nerve damage (neuropathy). Life expectancy ranges from the mid-30s in the more severe forms, to a nearly normal life expectancy for those with milder forms of the disease.

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SCA3 is caused by a CAG-repeat expansion in the ATXN3 gene, resulting in an abnormally long polyglutamine stretch in the encoded ataxin-3 protein. Mutant ataxin-3 protein is thought to cause widespread neuronal loss in the brain and spinal cord, likely through a toxic gain-of-function mechanism. SCA3 is the most common dominantly inherited form of ataxia. The prevalence of SCA3 is believed to be one to two cases in 100,000 people with significant geographic and ethnic variations.

Current Treatments

There are currently no disease-modifying therapies approved for treatment of SCA3. Treatment to date has involved the use of medications for symptomatic management, as well as physical and occupational therapy.

Our Program

In SCA3, we are continuing to advance our program targeting ATXN3.

Our Collaborations

Our business strategy is to develop and commercialize a broad pipeline of novel oligonucleotide therapies. As part of this strategy, we have entered into, and may enter into new partnership and collaboration agreements as a means of advancing our own therapeutic programs, investing in third-party technologies to further strengthen PRISM and leveraging external partnerships to extend the reach of PRISM into therapeutic areas where our platform demonstrates a competitive advantage.

GSK

On December 13, 2022, Wave Life Sciences USA, Inc. and Wave Life Sciences UK Limited, two of our direct, wholly-owned subsidiaries entered into a Collaboration and License Agreement (the “GSK Collaboration Agreement”) with GlaxoSmithKline Intellectual Property (No. 3) (“GSK”), which became effective on January 27, 2023. Pursuant to the GSK Collaboration Agreement, we and GSK have agreed to collaborate on the research, development, and commercialization of oligonucleotide therapeutics, including a global exclusive license to WVE-006. The discovery collaboration has an initial four-year research term and combines our proprietary discovery and drug development platform, PRISMTM, with GSK’s unique insights from human genetics and its global development and commercial capabilities.

Under the terms of the GSK Collaboration Agreement, we received an upfront payment of $170.0 million, which included a cash payment of $120.0 million and a $50.0 million equity investment. In addition, assuming WVE-006 and GSK’s eight collaboration programs achieve initiation, development, launch, and commercialization milestones, we would be eligible to receive up to $3.3 billion in cash milestone payments, which are described in the following two paragraphs.

GSK will receive the exclusive global license to WVE-006, our preclinical, first-in-class A-to-I(G) RNA editing candidate for alpha-1 antitrypsin deficiency, with development and commercialization responsibilities transferring to GSK after we complete the first-in-patient study. We will be responsible for preclinical, regulatory, manufacturing, and clinical activities for WVE-006 through the initial Phase 1/2 study, at our sole cost. Thereafter, GSK will be responsible for advancing WVE-006 through pivotal studies, registration, and global commercialization at GSK’s sole cost. For the WVE-006 program, we would be eligible to receive up to $225.0 million in development and launch milestone payments and up to $300.0 million in commercialization milestone payments, as well as double-digit tiered royalties as a percentage of net sales up to the high teens.

The collaboration has three components:

The collaboration will enable us to continue building a pipeline of transformational oligonucleotide-based therapeutics and unlock new areas of disease biology, as well as realize the full value of WVE-006 as a potential best-in-class treatment for AATD that has potential to simultaneously address both liver and lung manifestations of the disease.

The GSK Collaboration Agreement includes options to extend the research term for up to three additional years, which would increase the number of programs available to both parties. We will lead all preclinical research for GSK and our collaboration programs up to IND-enabling studies. We will lead IND-enabling studies, clinical development and commercialization for our collaboration programs. GSK collaboration programs will transfer to GSK for IND-enabling studies, clinical development, and commercialization.

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Assuming GSK advances eight programs under the collaboration that achieve initiation, development, launch and commercial milestones, we would be eligible to receive up to $1.2 billion in initiation, development, and launch milestones and up to $1.6 billion in commercialization milestones, as well as tiered royalties as a percentage of net sales into the low-teens. Assuming we advance our collaboration programs through the achievement of pre-determined milestones, GSK would be eligible to receive royalty payments and commercial milestones from us.

Under the GSK Collaboration Agreement, each party grants to the other party certain licenses to the collaboration products resulting from the parties’ respective collaboration programs as well as specific intellectual property licenses to enable the other party to perform its obligations and exercise its rights under the GSK Collaboration Agreement, including license grants to enable each party to conduct research, development, and commercialization activities pursuant to the terms of the GSK Collaboration Agreement. The parties’ exclusivity obligations to each other are limited on a target-by-target basis with regard to targets in the collaboration.

The GSK Collaboration Agreement, unless terminated earlier, will continue until the date on which: (i) with respect to a validation target, the date on which such validation target is not advanced into a collaboration program; or (ii) with respect to a collaboration target, the royalty term has expired for all collaboration products directed to the applicable collaboration target. The GSK Collaboration Agreement contains customary termination provisions, including certain termination rights for convenience, breach, and others, including on a target/program basis or of the Collaboration Agreement in its entirety.

With respect to the $50.0 million equity investment referred to above, simultaneously with our entry into the GSK Collaboration Agreement, we entered into a share purchase agreement with Glaxo Group Limited (“GGL”), an affiliate of GSK, pursuant to which we agreed to sell to GGL 10,683,761 of our ordinary shares at a purchase price of $4.68 per share, for an aggregate purchase price of approximately $50.0 million (the “GSK Equity Investment”). The GSK Equity Investment closed on January 26, 2023. The shares purchased by GGL are subject to lock-up and standstill restrictions and carry certain registration rights, customary for transactions of this kind.

Takeda

In February 2018, Wave Life Sciences USA, Inc. (“Wave USA”) and Wave Life Sciences UK Limited (“Wave UK”) entered into a collaboration and license agreement (the “Takeda Collaboration Agreement”) for a global strategic collaboration (the “Takeda Collaboration”) with Takeda Pharmaceutical Company Limited (“Takeda”), pursuant to which Wave USA, Wave UK and Takeda agreed to collaborate on the research, development and commercialization of oligonucleotide therapeutics for disorders of the Central Nervous System (“CNS”). The Takeda Collaboration provided us with at least $230.0 million in committed cash and Takeda with the option to co-develop and co-commercialize our CNS development programs in (1) Huntington’s disease (“HD”); (2) amyotrophic lateral sclerosis (“ALS”) and frontotemporal dementia (“FTD”); and (3) our discovery-stage program targeting ATXN3 for the treatment of spinocerebellar ataxia 3 (“SCA3”) (collectively, “Category 1 Programs”), which we will have the right to co-commercialize in the United States. In addition, the Takeda Collaboration provided Takeda with the right to exclusively license multiple preclinical programs for CNS disorders, including Alzheimer’s disease and Parkinson’s disease (collectively, “Category 2 Programs”). In April 2018, the Takeda Collaboration became effective and Takeda paid Wave $110.0 million as an upfront payment. Takeda also agreed to fund our research and preclinical activities in the amount of $60.0 million during the four-year research term and to reimburse Wave for any collaboration-budgeted research and preclinical expenses incurred by us that exceed that amount.

On October 15, 2021, we and Takeda entered into the Second Amendment (the “Amendment”) to the Takeda Collaboration Agreement, which amended the Category 2 component of the two-part collaboration (the “Category 2 Programs”). As discussed above, under Category 2 of the Takeda Collaboration Agreement, we had granted Takeda the right to exclusively license multiple preclinical programs for CNS disorders during a four-year research term. Pursuant to the terms of the Amendment, we and Takeda discontinued the Category 2 component of the Takeda Collaboration Agreement and Takeda paid us an additional $22.5 million for collaboration-related research and preclinical expenses. As a result of the Amendment, we are free to advance our CNS programs independently or enter partnerships in the CNS field outside of the three specified targets, C9orf72, HTT and ATXN3, including WVE-004 and WVE-003, that are part of the ongoing late-stage Category 1 Programs. The Category 1 component of the original Takeda Collaboration Agreement remains in effect and is unchanged by the Amendment.

Simultaneously with Wave USA and Wave UK’s entry into the Takeda Collaboration Agreement, we entered into a share purchase agreement with Takeda (the “Takeda Equity Agreement,” and together with the Takeda Collaboration Agreement, the “Takeda Agreements”) pursuant to which we agreed to sell to Takeda 1,096,892 of our ordinary shares at a purchase price of $54.70 per share. In April 2018, we closed the Takeda Equity Agreement and received aggregate cash proceeds of $60.0 million. The parties also agreed for the shares purchased by Takeda to be subject to certain lock-up and standstill restrictions and carry certain registration rights, customary for transactions of this kind.

With respect to Category 1 Programs, we will be responsible for researching and developing products and companion diagnostics for Category 1 Programs through completion of the first proof of mechanism study for such products. Takeda will have an exclusive option for each target and all associated products and companion diagnostics for such target, which it may exercise at any time through completion of the proof of mechanism study. If Takeda exercises this option, we will receive an opt-in payment and will lead manufacturing and joint clinical co-development activities and Takeda will lead joint co-commercial activities in the United States and

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all commercial activities outside of the United States. Global costs and potential profits will be shared 50:50 and we will be eligible to receive development and commercial milestone payments. In addition to its 50% profit share, we are eligible to receive option exercise fees and development and commercial milestone payments for each of the Category 1 Programs.

Under the Takeda Collaboration Agreement, each party grants to the other party specific intellectual property licenses to enable the other party to perform its obligations and exercise its rights under the Takeda Collaboration Agreement, including license grants to enable each party to conduct research, development and commercialization activities pursuant to the terms of the Takeda Collaboration Agreement.

The term of the Takeda Collaboration Agreement commenced on April 2, 2018 and, unless terminated earlier, will continue until the date on which: (i) with respect to each Category 1 Program target for which Takeda does not exercise its option, the expiration or termination of the development program with respect to such target; or (ii) with respect to each Category 1 Program target for which Takeda exercises its option, the date on which neither party is researching, developing or manufacturing any products or companion diagnostics directed to such target.

Takeda may terminate the Takeda Collaboration Agreement for convenience on 180 days’ notice, in its entirety or on a target-by-target basis. Subject to certain exceptions, each party has the right to terminate the Takeda Collaboration Agreement on a target-by-target basis if the other party, or a third party related to such party, challenges the patentability, enforceability or validity of any patents within the licensed technology that cover any product or companion diagnostic that is subject to the Takeda Collaboration Agreement. In the event of any material breach of the Takeda Collaboration Agreement by a party, subject to cure rights, the other party may terminate the Takeda Collaboration Agreement in its entirety if the breach relates to all targets or on a target-by-target basis if the breach relates to a specific target. In the event that Takeda and its affiliates cease development, manufacturing and commercialization activities with respect to compounds or products subject to the Takeda Collaboration Agreement and directed to a particular target, we may terminate the Takeda Collaboration Agreement with respect to such target. Either party may terminate the Takeda Collaboration Agreement for the other party’s insolvency. In certain termination circumstances, we would receive a license from Takeda to continue researching, developing and manufacturing certain products, and companion diagnostics.

Asuragen

In November 2019, we entered into an agreement with Asuragen, Inc. (which was acquired by Bio-Techne Corporation in April 2021) (“Asuragen”), a molecular diagnostics company, for the development and potential commercialization of companion diagnostics for our investigational allele-selective therapeutic programs targeting HD. This collaboration uses Asuragen’s market-leading repetitive sequence diagnostic expertise to provide scalable SNP phasing to support global development programs and future commercialization at a global level. Asuragen has leveraged its AmplideX® PCR technology to develop companion diagnostic tests designed to size and phase HTT CAG repeats with the SNPs targeted by our previous investigational therapeutic programs in HD, as well as WVE-003, our current HD program being investigated in the ongoing SELECT-HD clinical trial. These tests are designed to aid clinicians in selecting HD patients by identifying the SNPs that are in phase with the CAG-expanded allele.

Manufacturing

To provide internal cGMP manufacturing capabilities and increase control and visibility of our drug product supply chain, we entered into a lease in September 2016 for a multi-use facility of approximately 90,000 square feet in Lexington, Massachusetts and initiated the build out of manufacturing space and related capabilities. Through our internal manufacturing, we have the capacity to support multiple discovery-, preclinical-, and early clinical-stage programs and have the established expertise to efficiently conduct manufacturing runs for oligonucleotides across a spectrum of modalities. In addition to manufacturing space, the Lexington facility includes additional laboratory and office space. This facility supplements our existing Cambridge, Massachusetts laboratory and office space headquarters, enhances our ability to secure drug substance for current and future development activities and may provide commercial-scale manufacturing capabilities. In July 2017, we took occupancy of the Lexington facility and began manufacturing production in the fourth quarter of 2017.

We believe that leveraging our internal manufacturing capabilities along with expertise from CMOs facilitates our growth and enhances our ability to secure drug substance for current and future research, clinical and early-stage commercial development activities. We believe that the addition of our internal cGMP manufacturing capabilities, together with the supply capacity we have established externally, will be sufficient to meet our anticipated manufacturing needs for the next several years. We monitor the availability of capacity for the manufacture of drug substance and drug product and believe that our supply agreements with our contract manufacturers and the lead times for new supply agreements would allow us to access additional capacity if needed. We

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believe that our product candidates can be manufactured at scale and with production and procurement efficiencies that will result in commercially competitive costs.

Intellectual Property

We believe that we have a strong intellectual property position relating to the development and commercialization of our stereopure oligonucleotides. Our intellectual property portfolio includes filings designed to protect stereopure oligonucleotide compositions generally, as well as filings designed to protect stereopure compositions of oligonucleotides with particular stereochemical patterns (for example, that affect or confer biological activity). Our portfolio also includes filings for both proprietary methods and reagents, as well as various chemical methodologies that enable production of such stereopure oligonucleotide compositions. In addition, our portfolio includes filings designed to protect methods of using stereopure oligonucleotide compositions and filings designed to protect particular stereopure oligonucleotide products, such as those having a particular sequence, pattern of nucleoside and/or backbone modification, pattern of backbone linkages and/or pattern of backbone chiral centers.

We own or have rights to worldwide patent filings that protect our proprietary technologies for making stereopure oligonucleotide compositions, and that also protect the compositions themselves, as well as methods of using them, including in the treatment of diseases. Our portfolio includes multiple issued patents, including in major market jurisdictions such as the United States, Europe and Japan. We also have applications pending in multiple jurisdictions around the world, including these major market jurisdictions.

Synthetic Methodologies

Our patent portfolio includes multiple families that protect synthetic methodologies and/or reagents for generating stereopure oligonucleotide compositions. Certain synthetic methodologies and/or reagents are covered by families, which include an issued Japanese patent whose 20-year term extends to 2025.

Additional synthetic methodologies and/or reagents are protected by other families in our patent portfolio. Certain such families have 20-year expiration dates that range from 2029 to at least 2042. Some of these families have issued patents in several jurisdictions, including in major market jurisdictions such as the United States, Europe, and/or Japan, have pending applications in multiple jurisdictions including in these major market jurisdictions, or are in the international stage.

We also co-own with the University of Tokyo certain filings that are directed to certain methods and/or reagents for synthesizing oligonucleotides; their 20-year expiration dates fall in 2031.

Stereopure Oligonucleotide Compositions

Certain of our patent filings protect stereopure compositions, particularly of therapeutically relevant oligonucleotides. Some such filings are directed to compositions whose oligonucleotides are characterized by particular patterns of chemical modification (including modifications of bases, sugars and/or internucleotidic linkages) and/or of internucleotidic linkage stereochemistry. Certain patent filings describe specific compositions designed for use in the treatment of particular diseases. Several of our patent filings directed to stereopure compositions have entered national stage prosecution in multiple jurisdictions and some have issued in one or more jurisdictions; others are in the international stage. Certain filings offer 20-year protection terms that range from 2033 to at least 2042.

We also co-own with Shin Nippon Biomedical Laboratories, Ltd. various patent families, some of which include one or more issued patents, including in major market jurisdictions; these filings have 20-year terms extending to 2033-2035.

Future Filings

We maintain a thoughtful and ambitious program for developing and protecting additional intellectual property, including new synthetic methodologies and reagents. We also intend to prepare and submit patent filings specifically directed to protecting individual product candidates and their uses as we finalize leads and collect relevant data, which is expected to include comparison data confirming novel and/or beneficial attributes of our product candidates.

Singapore Intellectual Property Law

Section 34 of the Patents Act 1994 of Singapore (the “Singapore Patents Act”) provides that a person residing in Singapore is required to obtain written authorization from the Singapore Registrar of Patents (the “Registrar”) before filing an application for a patent for an invention outside of Singapore, unless all of the following conditions have been satisfied: (a) the person has filed an application for a patent for the same invention in the Singapore Registry of Patents at least two months before the filing of the patent application outside Singapore, and (b) the Singapore Registrar of Patents has not, in respect of this patent application, given directions to prohibit or restrict the publication of information contained in the patent application or its communication to any persons or description of

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persons pursuant to Section 33 of the Singapore Patents Act, or if the Registrar has given any such directions, all such directions have been revoked. A violation of Section 34 is a criminal offense punishable by a fine not exceeding S$5,000, or imprisonment for a term not exceeding two years, or both. There have been some instances where we have undertaken filings outside of Singapore, and there may be instances where we are required to make such filings in the future, without first obtaining written authorization from the Registrar. We have notified the Registrar of such filings and we have since implemented measures to address the requirements of Section 34 moving forward. To date, the Registrar has offered a compound of some of the offences considered against payment of a sum of S$50 to S$150 per considered case. Under Singapore law, the Registrar has discretion to offer a compound of such offences against payment of a sum of money of up to S$2,000, or to prosecute the offence subject to the other penalties noted above. Per requests in the Registrar’s most recent decision, we have submitted approximately 140 patent applications in multiple patent families, most of which are related to previously reported applications, to the Intellectual Property Office of Singapore (“IPOS”). The IPOS may consider the filing of some or all of these applications to have breached Section 34 requirements per IPOS’ current interpretation of Section 34, and we are waiting for IPOS’ decision on these applications. We cannot assure you that the Registrar will offer to compound any such violations of Section 34, or that any offer to compound will be for an amount similar to previous compound offers.

Competition

The biotechnology and pharmaceutical marketplace is characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products. While we believe that our expertise in oligonucleotides, scientific knowledge and intellectual property estate provide us with competitive advantages, we face potential competition from many different sources, including major pharmaceutical, specialty pharmaceutical and biotechnology companies, academic institutions, governmental agencies and public and private research institutions. Not only must we compete with other companies that are focused on oligonucleotides, but 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. Mergers and acquisitions in the pharmaceutical, biotechnology and diagnostic industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies.

Duchenne Muscular Dystrophy

There are two treatments approved in the United States for the treatment of DMD in patients who have a confirmed mutation of the DMD gene amenable to exon 53 skipping: Sarepta Therapeutics’ Vyondys 53 (golodirsen), an exon skipping nucleic acid therapeutic, was approved by the FDA in 2019, and NS Pharma’s Viltepso (viltolarsen), an exon skipping nucleic acid therapeutic, was approved by the FDA in 2020. Both therapies received accelerated approval, as the FDA concluded that the data submitted by each company demonstrated an increase in dystrophin production that is reasonably likely to predict clinical benefit in some patients with DMD who have a confirmed mutation of the DMD gene amenable to exon 53 skipping. No clinical benefit of golodirsen or viltolarsen has been established. Thus, in accordance with the U.S. accelerated approval regulations, the FDA is requiring Sarepta and NS Pharma to each conduct a clinical trial to verify and describe their drug’s clinical benefit. Sarepta’s study of golodirsen would need to assess whether golodirsen improves motor function of DMD patients with a confirmed mutation of the DMD gene amenable to exon 53 skipping, and NS Pharma’s study of viltolarsen is designed to assess whether viltolarsen improves the time to stand for DMD patients amenable to exon 53 skipping. If the trials fail to verify clinical benefit, the FDA could initiate proceedings to withdraw approval of the respective drug.

Several other companies have investigational drugs in clinical development targeting DMD more broadly, including patients amenable to exon 53 skipping. These include Capricor Therapeutics (Phase 3), Dystrogen Therapeutics (Phase 1), Edgewise Therapeutics (Phase 2), FibroGen (Phase 3), Pfizer (Phase 3), Santhera Pharmaceuticals (pre-registration), and Sarepta Therapeutics (pre-registration), among others. Based on available information, we do not believe there are other companies with investigational programs for exon 53 skipping in clinical development.

Several companies also have ongoing preclinical programs for DMD that may directly or indirectly target patients amenable to exon 53 skipping. These companies include Code Bio, Dyne Therapeutics, Daiichi Sankyo, Entrada Therapeutics, PepGen, Precision BioSciences, Sarepta Therapeutics, Solid Biosciences, and Ultragenyx, among others.

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Alpha-1 Antitrypsin Deficiency (“AATD”)

There are five treatments approved in the United States for AATD: Prolastin, Prolastin-C, Aralast NP, Zemaira, and Glassia. All five contain plasma-derived human alpha1-proteinase inhibitor and are indicated for chronic augmentation and maintenance therapy in adults with emphysema due to congenital deficiency of alpha1-proteinase inhibitor (Alpha1-PI). The prescribing information for each notes that the effect of augmentation therapy with any alpha1-proteinase inhibitor on pulmonary exacerbations and on the progression of emphysema in Alpha1-PI deficiency has not been demonstrated in randomized, controlled clinical trials.

There are also a number of companies with investigational drugs in clinical development: Arrowhead Pharmaceuticals and Takeda (Phase 3), Dicerna Pharmaceuticals and Alnylam Pharmaceuticals (Phase 2), InhibRx (Phase 1), Kamada (Phase 3), Mereo BioPharma (Phase 2), and Vertex Pharmaceuticals (Phase 2).

There are also several companies with ongoing discovery or preclinical programs for AATD including Apic Bio, Beam Therapeutics, Biomarin, Epic Bio, Intellia Therapeutics, KorroBio, and Krystal Biotech, among others.

Huntington’s Disease

There are no approved treatments available to slow the progression of HD. We believe, based on publicly available information, that Annexon Biosciences (Phase 2), AskBio (Phase 1/2), Ionis Pharmaceuticals and Roche (Phase 2), Mitochon Pharmaceuticals (Phase 2), Prilenia Therapeutics (Phase 3), PTC Therapeutics (Phase 2), and uniQure (Phase 1/2), among others, have investigational drugs in clinical development.

Several companies have ongoing discovery or preclinical programs for HD, including Alnylam Pharmaceuticals, Atalanta Therapeutics, LocanaBio, Neurimmune, Ophidion, Sangamo Therapeutics and Takeda, Spark Therapeutics, Vico, and Voyager Therapeutics, among others.

A number of companies are developing molecules to treat symptoms associated with HD, including Neurocrine Biosciences (Phase 3), Sage Therapeutics (Phase 2), and SOM Biotech (Phase 2), among others.

Amyotrophic Lateral Sclerosis and Frontotemporal Dementia

There are three treatments approved in the United States for the treatment of ALS: riluzole, approved in 1995, edaravone, approved in 2017, and RELYVRIO (sodium phenylbutyrate and taurursodiol), approved in 2022. There are a number of companies with potential therapeutics for the treatment of ALS in clinical development, including AB Science (Phase 3), Alector (Phase 2), Biohaven Pharmaceuticals (Phase 2/3), BrainStorm Cell Therapeutics (Phase 3 completed), Prilenia (Phase 2/3), and UCB (Phase 2/3), among others. We believe that Transposon Therapeutics has a Phase 2 study targeting patients with ALS or FTD due to a C9orf72 mutation.

Several companies have ongoing discovery or preclinical programs for ALS that may directly or indirectly target patients with the C9orf72 mutation, including AGTC, Apic Bio, Biogen and Neurimmune, Expansion Therapeutics, Locana Bio, Passage Bio, Pfizer and Sangamo Therapeutics, and uniQure.

There are no approved treatments available to slow the progression of FTD. Multiple companies have investigational therapies in clinical development for the broad FTD population, including Anavex (Phase 1 completed), Denali (Phase 1), and TauRx Pharmaceuticals (Phase 3 complete). Alector and Transposon Therapeutics each have ongoing Phase 2 studies targeting patients with FTD due to a C9orf72 mutation.

There are several companies with ongoing discovery or preclinical programs for FTD that may directly or indirectly target patients with the C9orf72 mutation, including Biogen and Neurimmune, Expansion Therapeutics, and Pfizer and Sangamo Therapeutics.

ADAR-mediated RNA Editing (“ADAR editing”)

There are several companies pursuing editing approaches that may compete with our ADAR editing modality. These companies are in various stages of development (discovery through the clinic) and are developing investigational drugs via viral (Shape Therapeutics) and non-viral delivery for RNA editing (ProQR and Korro Bio), DNA base-editing (Beam), and DNA editing (Editas Medicine, Intellia Therapeutics, and Sangamo Therapeutics), among others. These companies may leverage these approaches to target the same indications that we intend to target or indications where we do not currently plan to compete.

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Government Regulation

FDA Approval Process for Drug Products

In the United States, pharmaceutical products are subject to extensive regulation by the FDA. The Federal Food, Drug and Cosmetic Act (“FDCA”), and other federal and state statutes and regulations, govern, among other things, the research, development, testing, manufacture, storage, recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling, and import and export of pharmaceutical products. Failure to comply with applicable FDA or other requirements may subject a pharmaceutical company to a variety of administrative or judicial sanctions, such as the FDA’s refusal to approve pending applications, a clinical hold, warning letters, recall or seizure of drug products, partial or total suspension of production, withdrawal of drug products from the market, injunctions, fines, civil penalties or criminal prosecution.

FDA approval is required before any new drug, such as a new molecular or chemical entity, or a new dosage form, new use or new route of administration of a previously approved product, can be marketed in the United States. The process required by the FDA before a new drug product may be marketed in the United States generally involves:

The manufacturing development, preclinical and clinical testing, and review process requires substantial time, effort and financial resources. Manufacturing development includes laboratory evaluation of product chemistry, formulation, development of manufacturing and control procedures, evaluation of stability, and the establishment of procedures to ensure continued product quality.

Nonclinical tests may include in vitro and in vivo (animal model) studies to assess the toxicity and other safety characteristics of the product candidate, as well as important aspects of drug pharmacology and pharmacodynamics. The Consolidated Appropriations Act for 2023, signed into law on December 29, 2022, (P.L. 117-328) amended the FDCA and the Public Health Service Act to specify that nonclinical testing for drugs and biologics may, but is not required to, include in vivo animal testing. According to the amended language, a sponsor may fulfill nonclinical testing requirements by completing various in vitro assays (e.g., cell-based assays, organ chips, or microphysiological systems), in silico studies (i.e., computer modeling), other human or nonhuman biology-based tests (e.g., bioprinting), or in vivo animal tests.

The results of nonclinical tests, together with manufacturing information, analytical data and a proposed clinical trial protocol and other information, are submitted as part of an IND to the FDA. Some long-term nonclinical testing to further establish the safety profile of the product candidate, as well as manufacturing processes development and drug quality evaluation, continues after the IND is submitted. An IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, raises concerns or questions related to the proposed clinical trial and places the IND on a clinical hold. In such a case, the IND sponsor must resolve all outstanding concerns before the clinical trial can begin. As a result, our submission of an IND may not result in FDA authorization to commence a clinical trial. A separate submission to an existing IND must also be made for each successive

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clinical trial conducted during product development, or if changes are made in trial design. Even if the IND becomes effective and the trial proceeds without initial FDA objection, the FDA may stop the trial at a later time if it has concerns, such as if unacceptable safety risks arise.

Further, an IRB for each site proposing to conduct the clinical trial must review and approve the plan for any clinical trial and informed consent information for subjects before the trial commences at that site and it must perform an ongoing review of the research on an annual basis until the trial is completed. The FDA or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the subjects or patients are being exposed to an unacceptable health risk or that the trials are not being conducted in accordance with the clinical plan or in compliance with GCP. Similarly, an IRB can suspend or terminate approval of a clinical trial at its institution 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.

Clinical trials involve the administration of the product candidate to human subjects under the supervision of qualified investigators in accordance with GCP requirements, which include the requirement that all research subjects provide their informed consent in writing for their participation in any clinical trial. Sponsors of clinical trials of certain FDA-regulated products generally must register and disclose certain clinical trial information to a public registry maintained by the National Institutes of Health (“NIH”). In particular, information related to the product, patient population, phase of investigation, study sites and investigators and other aspects of the clinical trial is made public as part of the registration of the clinical trial. Competitors may use this publicly available information to gain knowledge regarding the progress of development programs. Although sponsors are also obligated to disclose the results of their clinical trials after completion, disclosure of the results can be delayed in some cases for up to two years after the date of completion of the trial. Failure to timely register a covered clinical study or to submit study results as provided for in the law can give rise to civil monetary penalties and also prevent the non-compliant party from receiving future grant funds from the federal government. The NIH’s Final Rule on ClinicalTrials.gov registration and reporting requirements became effective in 2017, and the government has brought enforcement actions against non-compliant clinical trial sponsors.

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

Progress reports detailing progress and safety data gathered from clinical trials must be submitted at least annually to the FDA. Safety reports are submitted more frequently if certain serious adverse effects (“SAEs”) occur. Phase 1, Phase 2 and Phase 3 clinical trials may not be completed successfully within any specified period, or at all. The FDA will typically inspect one or more clinical sites to assure compliance with GCP and the integrity of the clinical data submitted as part of NDA review. Information related to the product, patient population, phase of investigation, study sites and investigators and other aspects of the clinical trial is made public as part of the registration of the clinical trial. Sponsors are also obligated to disclose the results of most clinical trials after completion, although in some cases disclosure of the results of these trials can be delayed for up to two years after the trial completion date. Competitors may use this publicly available information to gain knowledge regarding the progress of development programs.

In the Consolidated Appropriations Act for 2023, Congress amended the FDCA to require sponsors of a Phase 3 clinical trial, or other “pivotal study” of a new drug to support marketing authorization, to submit a diversity action plan for such clinical trial. The action plan must include the sponsor’s diversity goals for enrollment, as well as a rationale for the goals and a description of how the sponsor will meet them. A sponsor must submit a diversity action plan to FDA by the time the sponsor submits the trial protocol to the agency for review. The FDA may grant a waiver for some or all of the requirements for a diversity action plan. It is unknown at this time how the diversity action plan may affect Phase 3 trial planning and timing or what specific information FDA will expect in such plans, but

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if FDA objects to a sponsor’s diversity action plan and requires the sponsor to amend the plan or take other actions, it may delay trial initiation.

Assuming successful completion of the required clinical testing, the results of the preclinical studies and clinical trials, along with information relating to the product’s pharmacology, chemistry, manufacturing, and controls, and proposed labeling, are submitted to the FDA as part of an NDA requesting approval to market the product for one or more indications. Data may come from company-sponsored clinical trials intended to test the safety and efficacy of a product’s use or from a number of alternative sources, including studies initiated by investigators. To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety and efficacy of the investigational product to the satisfaction of the FDA. Under federal law, the fee for the submission of an NDA with clinical data is substantial (for example, for fiscal year 2023 this application fee exceeds $3.2 million), and the sponsor of an approved NDA is also subject to an annual program fee, currently more than $390,000 per program. These fees are typically adjusted annually, but exemptions and waivers may be available under certain circumstances, including NDA fees for products with orphan designation.

The FDA has 60 days from its receipt of an NDA to determine whether the application will be accepted for filing based on the agency’s threshold determination that it is sufficiently complete to permit substantive review. The FDA may request additional information rather than accept an NDA for filing. Any resubmitted application, following a refusal to file action, is also subject to 60-day review before the FDA accepts it for filing.

Under the Prescription Drug User Fee Act (“PDUFA”), for original NDAs, the FDA has ten months from the filing date in which to complete its initial review of a standard application and respond to the applicant, and six months from the filing date for an application with priority review. For all new molecular entity (“NME”) NDAs, the ten and six-month time periods run from the filing date; for all other original applications, the ten and six-month time periods run from the submission date. Despite these review goals, it is not uncommon for FDA review of an NDA to extend beyond the goal date.

Once the submission has been accepted for filing, the FDA begins an in-depth review. As noted above, the FDA has agreed to specified performance goals in the review process of NDAs. Most such applications are meant to be reviewed within ten months from the date it is accepted for filing (i.e., 12 months), and most applications for “priority review” products are meant to be reviewed within six months from the date the application is accepted for filing (i.e., eight months). The review process may be extended by the FDA for three additional months to consider new information or in the case of a clarification provided by the applicant to address an outstanding deficiency identified by the FDA following the original submission.

Before approving an NDA, the FDA may inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities are in compliance with cGMP. The FDA may also inspect one or more of the clinical sites where pivotal trials were conducted and the contract research organization facilities with oversight of the trial, in order to ensure compliance with GCP and the integrity of the study data.

Additionally, the FDA may refer any NDA, including applications for novel biologic candidates which present difficult questions of safety or efficacy, to an advisory committee. 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 recommendation of an advisory committee, but it considers such recommendations when making final decisions on approval. The FDA likely will re-analyze the clinical trial data, which could result in extensive discussions between the FDA and the applicant during the review process. The FDA also may require submission of a risk evaluation and mitigation strategy (“REMS”) if it determines that a REMS is necessary to ensure that the benefits of the drug outweigh its risks and to assure the safe use of the drug or biological product. The REMS could include medication guides, physician communication plans, assessment plans and/or elements to assure safe use, such as restricted distribution methods, patient registries or other risk minimization tools. In addition, the REMS must include a timetable to assess the strategy, often at 18 months, three years, and seven years after the strategy’s approval. The FDA determines the requirement for a REMS, as well as the specific REMS provisions, on a case-by-case basis. If the FDA concludes a REMS is needed, the sponsor of the NDA must submit a proposed REMS. The FDA will not approve an NDA without a REMS, if required.

In determining whether a REMS is necessary, the FDA may consider the size of the population likely to use the drug, the seriousness of the disease or condition to be treated, the expected benefit of the drug, the duration of treatment, the seriousness of known or potential adverse events, and whether the drug is an NME. If the FDA determines a REMS is necessary, the drug sponsor must agree to the REMS plan at the time of approval, or at a later date should significant new risk information come to light. The FDA may impose a REMS requirement on a drug already on the market if the FDA determines, based on new safety information, that a REMS is necessary to ensure that the drug’s benefits outweigh its risks.

Under the Pediatric Research Equity Act (“PREA”), as amended, an NDA or supplement to an NDA must contain data that are adequate to assess the safety and efficacy of the product candidate for the claimed indications in all relevant pediatric populations and to support dosing and administration for each pediatric population for which the product is safe and effective. The FDA may grant deferrals for submission of pediatric data or full or partial waivers. PREA requires a sponsor who is planning to submit a marketing application for a product that includes a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration to submit an initial Pediatric Study Plan (“PSP”) within 60 days of an end-of-Phase 2 meeting or, if there is no such

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meeting, as early as practicable before the initiation of the Phase 3 or Phase 2/3 clinical trial. The initial PSP must include an outline of the pediatric study or studies that the sponsor plans to conduct, including trial objectives and design, age groups, relevant endpoints and statistical approach, or a justification for not including such detailed information, and any request for a deferral of pediatric assessments or a full or partial waiver of the requirement to provide data from pediatric studies along with supporting information. The FDA and the sponsor must reach an agreement on the PSP. A sponsor can submit amendments to an agreed upon initial PSP at any time if changes to the pediatric plan need to be considered based on data collected from pre-clinical studies, early phase clinical trials or other clinical development programs.

The FDA reviews an NDA to determine, among other things, whether a product is safe and effective for its intended use and whether its manufacturing is cGMP-compliant to assure and preserve the product’s identity, strength, quality and purity. The approval process is lengthy and often difficult, and the FDA may refuse to approve an NDA if the applicable regulatory criteria are not satisfied or may require additional clinical or other data and information. On the basis of the FDA’s evaluation of the NDA and accompanying information, including the results of the inspection of the manufacturing facilities, it may issue an approval letter or a Complete Response Letter (“CRL”). An approval letter authorizes commercial marketing of the product with specific prescribing information for specific indications. A CRL indicates that the review cycle for an application is complete and that the application will not be approved in its present form. CRLs outline the deficiencies in the submission and may require substantial additional testing or information in order for the FDA to reconsider the application. The CRL may require additional clinical or other data, additional pivotal Phase 3 clinical trial(s) and/or other significant and time-consuming requirements related to clinical trials, preclinical studies or manufacturing. If a CRL is issued, the applicant may choose to either resubmit the NDA addressing all of the deficiencies identified in the letter or withdraw the application. The FDA has committed to reviewing such resubmissions in response to an issued CRL in either 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. If and when the deficiencies have been addressed to the FDA’s satisfaction, the FDA will typically issue an approval letter.

The FDA may withdraw product approval if ongoing regulatory requirements are not met or if safety problems are identified after the product reaches the market. In addition, the FDA may require post-approval testing, including Phase 4 studies, and surveillance programs to monitor the effect of approved products which have been commercialized, and the FDA has the authority to prevent or limit further marketing of a product based on the results of these post-marketing programs. Products may be marketed only for the approved indications and in accordance with the provisions of the approved label and, even if the FDA approves a product, the FDA may limit the approved indications for use for the product or impose other conditions, including labeling or distribution restrictions or other risk-management mechanisms, such as a Boxed Warning, which highlights a serious safety concern that should be mitigated under a REMS program. Further, if there are any modifications to the product, including changes in indications, labeling, or manufacturing processes or facilities, a company is generally required to submit and obtain FDA approval of a supplemental NDA, which may require the company to develop additional data or conduct additional nonclinical studies and clinical trials.

Fast Track, Breakthrough Therapy and Priority Review Designations

The FDA is authorized to designate certain products for expedited development or review if they are intended to address an unmet medical need in the treatment of a serious or life-threatening disease or condition. These programs include fast track designation, breakthrough therapy designation and priority review designation.

To be eligible for a fast track designation, the FDA must determine, based on the request of a sponsor, that a product is intended to treat a serious or life-threatening disease or condition and demonstrates the potential to address an unmet medical need by providing a therapy where none exists or a therapy that may be potentially superior to existing therapy based on efficacy or safety factors. Fast track designation provides opportunities for more frequent interactions with the FDA review team to expedite development and review of the product. The FDA may also review sections of the NDA for a fast track product on a rolling basis before the complete application is submitted, if the sponsor and the FDA agree on a schedule for the submission of the application sections and the sponsor pays any required user fees upon submission of the first section of the NDA. In addition, fast track designation may be withdrawn by the sponsor or rescinded by the FDA if the designation is no longer supported by data emerging from the clinical trial process.

In addition, in 2012 Congress created a regulatory program for product candidates designated by FDA as “breakthrough therapies” upon a request made by the IND sponsors. A breakthrough therapy is defined as a drug or biologic that is intended, alone or in combination with one or more other drugs or biologics, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence indicates that the drug or biologic may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. Drugs or biologics designated as breakthrough therapies are also eligible for accelerated approval of their respective marketing applications. The FDA must take certain actions with respect to breakthrough therapies, such as holding timely meetings with and providing advice to the product sponsor, which are intended to expedite the development and review of an application for approval of a breakthrough therapy.

Finally, the FDA may designate a product for priority review if it is a drug or biologic that treats a serious condition and, if approved, would provide a significant improvement in safety or effectiveness over existing therapy. The FDA determines at the time that the

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marketing application is submitted, on a case- by-case basis, whether the proposed drug represents a significant improvement in treatment, prevention or diagnosis of disease 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 drug reaction, documented enhancement of patient compliance that may lead to improvement in serious outcomes, or evidence of safety and effectiveness in a new subpopulation. A priority review 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 for an NME NDA from the date of filing.

Even if a product qualifies for one or more of these programs, the FDA 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. Furthermore, fast track designation, breakthrough therapy designation and priority review do not change the standards for approval and may not ultimately expedite the development or approval process.

Accelerated Approval Pathway

In addition, products studied for their safety and effectiveness in treating serious or life-threatening illnesses and that provide meaningful therapeutic benefit over existing treatments may receive accelerated approval from the FDA and may be approved on the basis of adequate and well-controlled clinical trials establishing that the drug product has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit. The FDA may also grant accelerated approval for such a drug or biologic when the product has an effect on an intermediate clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality (“IMM”) and that is reasonably likely to predict an effect on IMM or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments. As a condition of approval, the FDA will require that a sponsor of a drug receiving accelerated approval perform post-marketing clinical trials to verify and describe the predicted effect on IMM or other clinical endpoint, and the product may be subject to expedited withdrawal procedures. Drugs and biologics granted accelerated approval must meet 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 generally may support accelerated approval when 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 long-term 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. For example, accelerated approval has been used extensively in the development and approval 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 clinical 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 product 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 establish the effect on the clinical endpoint. Failure to conduct required post-approval studies, or to confirm the predicted clinical benefit of the product during post-marketing studies, would allow the FDA to withdraw approval of the drug. As part of the Consolidated Appropriations Act for 2023, Congress provided FDA additional statutory authority to mitigate potential risks to patients from continued marketing of ineffective drugs previously granted accelerated approval. Under the act’s amendments to the FDCA, FDA may require the sponsor of a product granted accelerated approval to have a confirmatory trial underway prior to approval. The sponsor must also submit progress reports on a confirmatory trial every six months until the trial is complete, and such reports are published on FDA’s website. The amendments also give FDA the option of using expedited procedures to withdraw product approval if the sponsor’s confirmatory trial fails to verify the claimed clinical benefits of the product.

All promotional materials for product candidates being considered and approved under the accelerated approval program are subject to prior review by the FDA.

Post-Approval Requirements

Once an NDA is approved, a product will be subject to continuing regulation by the FDA, including, among other things, requirements relating to safety surveillance and adverse event reporting, periodic reporting, continued cGMP compliance and quality oversight,

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compliance with post-marketing commitments, recordkeeping, advertising and promotion, and reporting manufacturing and labeling changes, as applicable.

In addition, drug manufacturers and other entities involved in the manufacture and distribution of approved drugs (including third-party manufacturers) are required to register their establishments with the FDA and some state agencies and are subject to periodic unannounced inspections by the FDA and some state agencies for assessment of compliance with cGMP. Changes to the manufacturing process are strictly regulated and often require prior FDA approval before being implemented. FDA regulations also require investigation and correction, and sometimes notification of, any deviations from cGMP. These regulations impose reporting and documentation requirements on the sponsor and any third-party manufacturers that we 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. Discovery of previously unknown problems with a product, including adverse events of unlisted severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements such as noncompliance with cGMP or failure to correct previously identified inspection findings, may result in mandatory revisions to the approved labeling to add new safety information; imposition of post-market 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:

The FDA strictly regulates marketing, labeling, advertising and promotion of products that are placed on the market. While physicians may generally prescribe a drug for off-label uses, manufacturers may only promote the drug in accordance with the approved product label. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have promoted false and misleading information about the product may be subject to significant liability, both at the federal and state levels.

In addition, the distribution of prescription pharmaceutical products is subject to the Prescription Drug Marketing Act (“PDMA”) which regulates the distribution of drugs and 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 requirements to ensure accountability in distribution. Most recently, the Drug Supply Chain Security Act (“DSCSA”) was enacted with the aim of building an electronic system to identify and trace certain prescription drugs distributed in the United States. The DSCSA mandates phased-in and resource-intensive obligations for pharmaceutical manufacturers, wholesale distributors, and dispensers over a ten‑year period that is expected to culminate in November 2023. From time to time, new legislation and regulations may be implemented that could significantly change the statutory provisions governing the approval, manufacturing and marketing of products regulated by the FDA. It is impossible to predict whether further legislative or regulatory changes will be enacted, or FDA regulations, guidance or interpretations changed or what the impact of such changes, if any, may be.

Orphan Drug Designation

Under the Orphan Drug Act, the FDA may grant orphan drug designation to a drug intended to treat a rare disease or condition, which is defined as one affecting fewer than 200,000 individuals in the United States or more than 200,000 individuals where there is no reasonable expectation that the product development cost will be recovered from product sales in the United States. Orphan drug designation must be requested before submitting an NDA. After the FDA grants orphan drug designation, the identity of the drug and its potential orphan use will be disclosed publicly by the FDA; the posting will also indicate whether a drug is no longer designated as an orphan drug. More than one product candidate may receive an orphan drug designation for the same indication. Orphan drug designation does not convey any advantage in or shorten the duration of the regulatory review and approval process.

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Under PREA, submission of a pediatric assessment is not required for pediatric investigation of a product that has been granted orphan drug designation. However, under the FDA Reauthorization Act of 2017 (“FDASIA”), the scope of the PREA was extended to require pediatric studies for products intended for the treatment of an adult cancer that are directed at a molecular target that are determined to be substantially relevant to the growth or progression of a pediatric cancer. In addition, the FDA finalized guidance in 2018 indicating that it does not expect to grant any additional orphan drug designation to products for pediatric subpopulations of common diseases. Nevertheless, the FDA intends to still grant orphan drug designation to a drug or biologic that otherwise meets all other criteria for designation when it prevents, diagnoses or treats either (i) a rare disease that includes a rare pediatric subpopulation, (ii) a pediatric subpopulation that constitutes a valid orphan subset, or (iii) a rare disease that is in fact a different disease in the pediatric population as compared to the adult population.

If an orphan drug-designated product subsequently receives FDA approval for the disease for which it was designed, the product will be entitled to seven years of product exclusivity, which means that the FDA may not approve any other applications to market the same drug for the same indication, except in very limited circumstances (such as a showing of clinical superiority to the product with orphan exclusivity by means of greater effectiveness, greater safety or providing a major contribution to patient care or in instances of drug supply issues), for seven years. Orphan exclusivity does not block the approval of a different drug or biologic for the same rare disease or condition, nor does it block the approval of the same drug or biologic for different conditions. If a competitor obtains approval of the same drug, as defined by the FDA, or if our product candidate is determined to be the same drug as a competitor’s product for the same indication or disease, the competitor’s exclusivity could block the approval of our product candidate in the designated orphan indication for seven years, unless our product is demonstrated to be clinically superior to the competitor’s drug.

European Union Orphan Drug Designation

In the European Union (the “EU”), orphan drug designation by the European Commission (the “EC”) provides regulatory and financial incentives for companies to develop and market therapies that meet the following requirements: (1) the product is intended for the diagnosis, prevention or treatment of life-threatening or chronically debilitating conditions; (2) either (a) such condition affects no more than five in 10,000 persons in the European Union when the application is made, or (b) the product, without the benefits derived from orphan status, would not generate sufficient return in the European Union to justify investment; and (3) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the European Union, or if such a method exists, the product will be of significant benefit to those affected by the condition, as defined in Regulation (EC) 847/2000. To be considered for orphan drug designation in the EU, companies must provide data that demonstrate the plausibility for use of the investigational therapy in the treatment of the disease and establish that the drug has the potential to provide relevant advantages or a major contribution to patient care over existing therapies.

Among the incentives available to medicines designated as orphan drugs by the EC are ten-year market exclusivity in the EU after product approval, eligibility for conditional marketing authorization, protocol assistance from the European Medicines Agency at reduced fees during the product development phase and direct access to centralized marketing authorization in the EU. The exclusivity period may be reduced to six years if, at the end of the fifth year, the orphan drug designation criteria are no longer met, including where it is shown that the product is sufficiently profitable not to justify maintenance of market exclusivity. In addition, marketing authorization may be granted to a similar medicinal product with the same orphan indication during the ten-year period with the consent of the marketing authorization holder for the original orphan medicinal product or if the manufacturer of the original orphan medicinal product is unable to supply sufficient quantities of the product. Marketing authorization may also be granted to a similar medicinal product with the same orphan indication if the similar product is deemed safer, more effective or otherwise clinically superior to the original orphan medicinal product. Orphan drug designation must be requested before submitting an application for marketing authorization. Orphan drug designation does not, in itself, convey any advantage in, or shorten the duration of, the regulatory review and authorization process.

Pediatric Exclusivity and Pediatric Use

The Best Pharmaceuticals for Children Act (“BPCA”) provides NDA holders a six-month period of non-patent marketing exclusivity attached to any other exclusivity listed with FDA—patent or non-patent—for a drug if certain conditions are met. Conditions for pediatric exclusivity include a determination by the FDA that information relating to the use of a new drug in the pediatric population may produce health benefits in that population; a written request by the FDA for pediatric studies; and agreement by the applicant to perform the requested studies and the submission to the FDA, completion of the studies in accordance with the written request, and the acceptance by the FDA, of the reports of the requested studies within the statutory timeframe. The data do not need to show the product to be effective in the pediatric population studied; rather, if the clinical trial is deemed to fairly respond to the FDA’s request, the additional protection is granted. If reports of requested pediatric studies are submitted to and accepted by the FDA within the statutory time limits, whatever statutory or regulatory periods of exclusivity or patent protection cover the product are extended by six months. This is not a patent term extension, but it effectively extends the regulatory period during which the FDA cannot approve another application. The issuance of a written request does not require the sponsor to undertake the described studies. Applications under the BPCA are treated as priority applications.

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The Hatch-Waxman Act and Marketing Exclusivity

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 and also enacted Section 505(b)(2) of the FDCA. To obtain approval of a generic drug, an applicant must submit an abbreviated new drug application (“ANDA”) to the agency. In support of such applications, a generic manufacturer may rely on the preclinical and clinical testing conducted for a drug product previously approved under an NDA, known as the reference listed drug (“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” to the innovator drug.

Upon NDA approval of a new chemical entity (“NCE”), which is a drug that contains no active moiety that has been approved by the FDA in any other NDA, that drug receives five years of marketing exclusivity. During the exclusivity period, the FDA cannot accept for review any ANDA or 505(b)(2) NDA submitted by another company for another version of such drug where the applicant does not own or have a legal right of reference to all the data required for approval. However, an application may be submitted one year before NCE exclusivity expires if a Paragraph IV certification is filed on an NCE patent and any time after approval if the application is filed based on a new indication or a new formulation.

The Hatch-Waxman Act also provides three years of data exclusivity for an NDA, 505(b)(2) NDA or supplement to an existing NDA if new clinical investigations, other than bioavailability studies, that were conducted or sponsored by the applicant are deemed by the FDA to be essential to the approval of the application, for example, new indications, dosages or strengths of an existing drug. This three-year exclusivity covers only the conditions of use associated with the new clinical investigations and does not prohibit the FDA from approving follow-on applications for drugs containing the original active agent. If there is no listed patent in the Orange Book, there may not be a Paragraph IV certification, and, thus, no ANDA or 505(b)(2) NDA may be filed before the expiration of the exclusivity period. Five-year and three-year exclusivity also will not delay the submission or approval of a traditional NDA filed under Section 505(b)(1) of the FDCA. However, an applicant submitting a traditional NDA would be required to either conduct or obtain a right of reference to all of the preclinical studies and adequate and well-controlled clinical trials necessary to demonstrate safety and effectiveness.

Patent Term Restoration

Depending upon the timing, duration and specifics of FDA approval of the use of our therapeutic candidates, some of our U.S. patents may be eligible for limited patent term extension under the Hatch-Waxman Act. The Hatch-Waxman Act permits a patent restoration term of up to five years as compensation for any patent term lost during product development and the FDA regulatory review process. However, patent term restoration cannot extend the remaining term of a patent beyond a total of 14 years from the product’s approval date. The patent term restoration period is generally one-half the time between the effective date of an IND and the submission date of an NDA, plus the time between the submission date of an NDA and the approval of that application. Only one patent applicable to an approved drug is eligible for the extension and the application for extension must be made prior to the expiration of the patent. The United States Patent and Trademark Office (“USPTO”), in consultation with the FDA, reviews and approves the application for any patent term extension or restoration. In the future, we intend to apply for restorations of patent term for some of our currently owned or licensed patents to add patent life beyond their current expiration date, depending on the expected length of clinical trials and other factors involved in the submission of the relevant NDA.

In Vitro Diagnostic Tests for Biomarkers

For some of our product candidates, we plan to work with collaborators to develop or obtain access to in vitro companion diagnostic tests to identify appropriate patients for these targeted therapies. If a sponsor or the FDA believes that a diagnostic test is essential for the safe and effective use of a corresponding therapeutic product, a sponsor will typically work with a collaborator to develop an in vitro diagnostic (“IVD”). IVDs are regulated by the FDA as medical devices, and since 2014 the agency has issued final and draft guidance documents that are intended to assist companies developing in vitro companion diagnostic devices and companies developing therapeutic products that depend on the use of a specific in vitro companion diagnostic for the safe and effective use of the therapeutic product.

The three types of marketing pathways for medical devices are clearance of a premarket notification under Section 510(k) of the FDCA (“510(k)”), approval of a premarket approval application (“PMA”) and a de novo classification request, or de novo. If a company is required to perform clinical trials to support the safety and effectiveness of an IVD, and the IVD is viewed as a significant risk device, the sponsor will have to submit an investigational device exemption application (“IDE”) to the FDA, which is similar in format and function to an IND. If the diagnostic test and the therapeutic drug are studied together to support their respective approvals, any clinical trials involving both product candidates must meet both the IDE and IND requirements.

The FDA expects that the therapeutic sponsor will address the need for an IVD companion diagnostic device in its therapeutic product development plan and that, in most cases, the therapeutic product and its corresponding IVD companion diagnostic device will be

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developed contemporaneously. If the companion diagnostic test will be used to make critical treatment decisions such as patient selection, treatment assignment, or treatment arm, it will likely be considered a significant risk device for which a clinical trial will be required. After approval, the use of an IVD companion diagnostic device with a therapeutic product will be stipulated in the instructions for use in the labeling of both the diagnostic device and the corresponding therapeutic product. In addition, a diagnostic test that was approved through the PMA process, or one that was cleared through the 510(k) process or reclassified through the de novo process, and placed on the market will be subject to many of the same regulatory requirements that apply to approved drugs.

However, the FDA may decide that it is appropriate to approve such a therapeutic product without an approved or cleared in vitro companion diagnostic device when the drug or therapeutic biologic is intended to treat a serious or life-threatening condition for which no satisfactory alternative treatment exists and the FDA determines that the benefits from the use of a product with an unapproved or uncleared in vitro companion diagnostic device are so pronounced as to outweigh the risks from the lack of an approved or cleared in vitro companion diagnostic device. The FDA encourages sponsors considering developing a therapeutic product that requires a companion diagnostic to request a meeting with both relevant device and therapeutic product review divisions to ensure that the product development plan will produce sufficient data to establish the safety and effectiveness of both the therapeutic product and the companion diagnostic. Because the FDA’s policies on companion diagnostics is set forth only in guidance, this policy is subject to change and is not legally binding.

European Union Regulation of Drug Products

In addition to regulations in the United States, we are and will be subject, either directly or through our distribution partners, to a variety of regulations in other jurisdictions governing, among other things, clinical trials, the privacy of personal data and commercial sales and distribution of our products, if approved.

Whether or not we obtain FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in non-U.S. countries prior to the commencement of clinical trials or marketing of the product in those countries. Certain countries outside of the United States have a process that requires the submission of a clinical trial application much like an IND prior to the commencement of human clinical trials. In Europe, for example, a clinical trial application (“CTA”), must be submitted to the competent national health authority and to independent ethics committees in each country in which a company plans to conduct clinical trials. Once the CTA is approved in accordance with a country’s requirements, clinical trials may proceed in that country. Under the EU Clinical Trials Regulation, a harmonized assessment and supervision process was implemented as of January 31, 2022 for clinical trials throughout the EU, via a Clinical Trials Information System (“CTIS”). The CTIS will contain the centralized EU portal and database for clinical trials conducted in the EU and will allow for a centralized review process. This harmonized submission process became mandatory for new CTA submissions to be filed beginning on February 1, 2023. Under the new centralized process, if the EU member state leading the CTA review approves or rejects the application, the decision will apply to all involved member states.

The requirements and process governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country, even though there is already some degree of legal harmonization in the EU member states resulting from the national implementation of underlying EU legislation. In all cases, the clinical trials are conducted in accordance with GCP and other applicable regulatory requirements.

To obtain a marketing license for a new drug or medicinal product in the European Union, the sponsor must obtain approval of a marketing authorization application (“MAA”). The way in which a medicinal product can be approved in the European Union depends on the nature of the medicinal product. As of January 31, 2020, the United Kingdom (“UK”) is no longer a member state of the EU, and therefore a separate MAA and approval will be required to market a medicinal product in the UK. The UK’s Medicines and Healthcare products Regulatory Agency (“MHRA”) has issued guidance regarding the requirements for licensing and marketing therapeutic drugs and biologics post-Brexit.

The centralized procedure results in a single marketing authorization granted by the European Commission that is valid across the European Union, as well as in Iceland, Liechtenstein, and Norway. The centralized procedure is compulsory for human drugs that: (i) are derived from biotechnology processes, such as genetic engineering, (ii) contain a new active substance indicated for the treatment of certain diseases, such as HIV/AIDS, cancer, diabetes, neurodegenerative diseases, autoimmune and other immune dysfunctions and viral diseases, (iii) are officially designated “orphan drugs” (drugs used for rare human diseases) and (iv) are advanced-therapy medicines, such as gene-therapy, somatic cell-therapy or tissue-engineered medicines. The centralized procedure may at the request of the applicant also be used for human drugs which do not fall within the above mentioned categories if (a) the human drug contains a new active substance which was not authorized in the European Community; or (b) the applicant shows that the medicinal product constitutes a significant therapeutic, scientific or technical innovation or that the granting of authorization in the centralized procedure is in the interests of patients or animal health at the European Community level.

Under the centralized procedure in the European Union, the maximum timeframe for the evaluation of a marketing authorization application by the EMA is 210 days (excluding clock stops, when additional written or oral information is to be provided by the applicant in response to questions asked by the Committee for Medicinal Products for Human Use (“CHMP”)), with adoption of the actual marketing authorization by the European Commission thereafter. Accelerated evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is expected to be of a major public health interest from the point of view of therapeutic innovation, defined by three cumulative criteria: the seriousness of the disease to be treated; the absence of an appropriate alternative

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therapeutic approach, and anticipation of exceptional high therapeutic benefit. In this circumstance, EMA ensures that the evaluation for the opinion of the CHMP is completed within 150 days and the opinion issued thereafter.

The mutual recognition procedure (“MRP”) for the approval of human drugs is an alternative approach to facilitate individual national marketing authorizations within the European Union. Basically, the MRP may be applied for all human drugs for which the centralized procedure is not obligatory. The MRP is applicable to the majority of conventional medicinal products, and is based on the principle of recognition of an already existing national marketing authorization by one or more member states. In the MRP, a marketing authorization for a drug already exists in one or more member states of the European Union and subsequently marketing authorization applications are made in other European Union member states by referring to the initial marketing authorization. The member state in which the marketing authorization was first granted will then act as the reference member state. The member states where the marketing authorization is subsequently applied for act as concerned member states. After a product assessment is completed by the reference member state, copies of the report are sent to all member states, together with the approved summary of product characteristics, labeling and package leaflet. The concerned member states then have 90 days to recognize the decision of the reference member state and the summary of product characteristics, labeling and package leaflet. National marketing authorizations within individual member states shall be granted within 30 days after acknowledgement of the agreement.

Should any member state refuse to recognize the marketing authorization by the reference member state, on the grounds of potential serious risk to public health, the issue will be referred to a coordination group. Within a timeframe of 60 days, member states shall, within the coordination group, make all efforts to reach a consensus. If this fails, the procedure is submitted to an EMA scientific committee for arbitration. The opinion of this EMA committee is then forwarded to the Commission, for the start of the decision-making process. As in the centralized procedure, this process entails consulting various European Commission Directorates General and the Standing Committee on Human Medicinal Products or Veterinary Medicinal Products, as appropriate.

European Union Regulation of IVD Products

In May 2022, the In Vitro Diagnostic Device Regulation (IVDR) (EU) 2017/746 became effective, replacing the previous IVD Directive (EU-Directive 98/79/EC). The IVDR was published in May 2017 and given a five-year transition period until its full implementation on May 26, 2022. Unlike the IVD Directive, the IVDR has binding legal force throughout every Member State. The major goals of the IVDR are to standardize diagnostic procedures within the EU, increase reliability of diagnostic analysis and enhance patient safety. Among other things, the IVDR introduces a new risk-based classification system for IVDs and requirements for IVD conformity assessments. Under the IVDR and subsequent amendments, IVDs already certified by a Notified Body may remain on the market until May 26, 2025, and IVDs certified without the involvement of a Notified Body may remain on the market for up to two additional years (until May 26, 2027) depending on the classification of the IVD. The manufacturers of such devices remaining on the market must comply with specific requirements in the IVDR, but ultimately, such products, as with all new IVDs, will have to undergo the IVDR’s conformity assessment procedures. In addition, IVDs in the highest risk class will have to be tested by a Designated Reference Laboratory. The IVDR imposes additional requirements relating to post-market surveillance and submission of post-market performance follow-up reports.

The EC has designated six Notified Bodies to perform conformity assessments under the IVDR. MedTech Europe has issued guidance relating to the IVDR in several areas, e.g., clinical benefit, technical documentation, state of art, accessories, and EUDAMED.

Rest of World Government Regulation

For countries outside of the United States and the European Union, 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, the clinical trials must be conducted in accordance with GCP and the other applicable regulatory requirements.

If we fail to comply with applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension of clinical trials, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions, and criminal prosecution.

Other Healthcare Laws

Although we currently do not have any products on the market, if our product candidates are approved in the United States, we will have to comply with various U.S. federal and state laws, rules and regulations pertaining to healthcare fraud and abuse, including anti-kickback laws and physician self-referral laws, rules and regulations. Violations of the fraud and abuse laws are punishable by criminal and civil sanctions, including, in some instances, exclusion from participation in federal and state healthcare programs, including Medicare and Medicaid. These laws include the following:

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Some state laws require pharmaceutical or medical device companies to comply with the relevant industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring drug manufacturers to report information related to payments to physicians and other health care providers or marketing expenditures.

In November 2020, the Department of Health and Human Services (“DHHS”) finalized significant changes to the regulations implementing the Anti-Kickback Statute, as well as the civil monetary penalty rules regarding beneficiary inducements, with the goal of offering the healthcare industry more flexibility and reducing the regulatory burden associated with those fraud and abuse laws, particularly with respect to value-based arrangements among industry participants.

State and foreign laws also govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. We also are subject to, or may in the future become subject to, U.S. federal and state, and foreign laws and regulations imposing obligations on how we collect, use, disclose, store and process personal information. Our actual or perceived failure to comply with such obligations could result in liability or reputational harm and could harm our business.

Pharmaceutical Coverage, Pricing, and Reimbursement

Significant uncertainty exists as to the coverage and reimbursement status of products approved by the FDA and other government authorities. Sales of our products, when and if approved for marketing in the United States, will depend, in part, on the extent to which our products will be covered by third-party payors, such as federal, state, and foreign government healthcare programs, commercial insurance and managed healthcare organizations. 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 may limit coverage to specific products on an approved list, or formulary, which might not include all of the approved products for a particular indication. In addition, these third-party payors are increasingly reducing reimbursements for medical products, drugs and services. Furthermore, the U.S. government, state legislatures and foreign governments have continued implementing cost containment programs, including price controls, restrictions on coverage and reimbursement and requirements for substitution of generic products. Adoption of price controls and cost containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit our net revenue and results. Limited third-party reimbursement for our product candidates or a decision by a third-party payor not to cover our product candidates could reduce physician usage of our products once approved and have a material adverse effect on our sales, results of operations and financial condition.

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In Europe and other countries outside of the United States, pricing and reimbursement schemes vary widely from country to country. Some countries provide that drug products may be marketed only after a reimbursement price has been agreed to. Some countries may require the completion of additional studies that compare the cost-effectiveness of a particular product candidate to currently available therapies. In some countries, cross-border imports from low-priced markets exert competitive pressure that may reduce pricing within a country. Any country that has price controls or reimbursement limitations for drug products may not allow favorable reimbursement and pricing arrangements.

Healthcare Reform

In the United States and some foreign jurisdictions, there have been, and continue to be, several legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval of product and therapeutic candidates, restrict or regulate post-approval activities, and affect the ability to profitably sell product and therapeutic candidates that obtain marketing approval. The FDA’s and other regulatory authorities’ policies may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product and therapeutic candidates. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we otherwise may have obtained and we may not achieve or sustain profitability, which would adversely affect our business, prospects, financial condition and results of operations. Moreover, among policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and/or expanding access.

For example, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act (collectively, the “ACA”), was enacted in March 2010 and has had a significant impact on the health care industry in the United States. The ACA expanded coverage for the uninsured while at the same time containing overall healthcare costs. With regard to biopharmaceutical products, the ACA, among other things, addressed a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, increased the minimum Medicaid rebates owed by manufacturers under the Medicaid Drug Rebate Program and extended the rebate program to individuals enrolled in Medicaid managed care organizations, established annual fees on manufacturers of certain branded prescription drugs, and created a new Medicare Part D coverage gap discount program. Additionally, on December 20, 2019, the Further Consolidated Appropriations Act for 2020 was signed into law (P.L. 116-94) and includes a piece of bipartisan legislation called the Creating and Restoring Equal Access to Equivalent Samples Act of 2019 or the “CREATES Act.” The CREATES Act aims to address the concern articulated by both the FDA and others in the industry that some brand manufacturers have improperly restricted the distribution of their products, including by invoking the existence of a REMS for certain products, to deny generic product developers access to samples of brand products. Because generic product developers need samples to conduct certain comparative testing required by the FDA, some have attributed the inability to timely obtain samples as a cause of delay in the entry of generic products. To remedy this concern, the CREATES Act establishes a private cause of action that permits a generic product developer to sue the brand manufacturer to compel it to furnish the necessary samples on “commercially reasonable, market-based terms.” Whether and how generic product developments will use this new pathway, as well as the likely outcome of any legal challenges to provisions of the CREATES Act, remain highly uncertain and its potential effects on any of our future commercial products are unknown.

Since the enactment of the ACA, there have been executive, judicial and Congressional challenges to certain aspects and as a result certain sections of the ACA have not been fully implemented or have been effectively repealed through Executive Orders and/or executive agency actions. However, following several years of litigation in the federal courts, in June 2021, the U.S. Supreme Court upheld the ACA when it dismissed a legal challenge to the ACA’s constitutionality. Further legislative and regulatory changes under the ACA remain possible, although the Biden Administration has signaled that it plans to build on the ACA and expand the number of people who are eligible for health insurance subsidies under it. It is unknown what form any such changes or any law would take, and how or whether it may affect the biopharmaceutical industry as a whole or our business in the future. We expect that changes or additions to the ACA, the Medicare and Medicaid programs, and changes stemming from other healthcare reform measures, especially with regard to healthcare access, financing or other legislation in individual states, could have a material adverse effect on the health care industry in the United States.

In addition, other legislative changes have been proposed and adopted in the United States since the ACA that affect health care expenditures. These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and was extended by the Consolidated Appropriations Act for 2023, and will remain in effect through 2032 unless additional Congressional action is taken.

Moreover, there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their marketed products, which has resulted in several Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drug products. In May 2019, DHHS issued a final rule to allow Medicare Advantage plans the option to use step therapy for Part B drugs beginning January 1, 2020. This final rule codified a DHHS policy change that was effective January 1, 2019.

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More recently, in August 2022, President Biden signed into the law the Inflation Reduction Act of 2022, or the IRA. Among other things, the IRA has multiple provisions that may impact the prices of drug products that are both sold into the Medicare program and throughout the United States. Starting in 2023, a manufacturer of a drug or biological product covered by Medicare Parts B or D must pay a rebate to the federal government if the drug product’s price increases faster than the rate of inflation. This calculation is made on a drug product by drug product basis and the amount of the rebate owed to the federal government is directly dependent on the volume of a drug product that is paid for by Medicare Parts B or D. Additionally, starting in payment year 2026, CMS will negotiate drug prices annually for a select number of single source Part D drugs without generic or biosimilar competition. CMS will also negotiate drug prices for a select number of Part B drugs starting for payment year 2028. If a drug product is selected by CMS for negotiation, it is expected that the revenue generated from such drug will decrease.

Individual states in the United States have also increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. In December 2020, the U.S. Supreme Court held unanimously that federal law does not preempt the states’ ability to regulate pharmaceutical benefit managers (“PBMs”) and other members of the health care and pharmaceutical supply chain, an important decision that may lead to further and more aggressive efforts by states in this area.

We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action, either in the United States or abroad. We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, including any future drug products for which we secure marketing approval.

Manufacturing Requirements

We and our third-party manufacturers must comply with applicable cGMP requirements. The cGMP requirements include requirements relating to, among other things, organization of personnel, buildings and facilities, equipment, control of components and drug product containers and closures, production and process controls, packaging and labeling controls, holding and distribution, laboratory controls, records and reports, and returned or salvaged products. The manufacturing facilities for our products must meet cGMP requirements to the satisfaction of the FDA pursuant to a pre-approval inspection before we can use them to manufacture commercial products. We and our third-party manufacturers are also subject to periodic announced or for-cause unannounced inspections of facilities by the FDA and other authorities, including procedures and operations used in the testing and manufacture of our commercial products, if any, to assess our compliance with applicable regulations. Failure to comply with statutory and regulatory requirements subjects a manufacturer to possible legal or regulatory action, including, among other things, warning or other enforcement letters, voluntary corrective action, the seizure of products, injunctions, consent decrees placing significant restrictions on or suspending manufacturing operations, disgorgement of profits, and other civil and criminal penalties.

Other Regulatory Requirements

We are also subject to various laws and regulations regarding laboratory practices, the experimental use of animals, and the use and disposal of hazardous or potentially hazardous substances in connection with our research. In each of these areas, as above, the FDA has broad regulatory and enforcement authority, including, among other things, the ability to levy fines and civil penalties, suspend or delay issuance of approvals, seize or recall products, and withdraw approvals, any one or more of which could have an adverse effect on our ability to operate our business and generate revenues. Compliance with applicable environmental laws and regulations is expensive, and current or future environmental regulations may impair our research, development and production efforts, which could harm our business, operating results and financial condition.

Human Capital

As of December 31, 2022, we employed 252 employees, of which 250 were full-time employees. A significant number of our management and professional employees have had prior experience with pharmaceutical, biotechnology or medical product companies. None of our employees are represented by a labor union or covered under a collective bargaining agreement. Management considers relations with our employees to be good.

Our approach to how we recruit, develop, retain and manage our talent is driven by our values statement: Making an impact through innovation, inclusion, and inspiration. Our values are at the core of who we are as an organization, and what drive us to envision a brighter future for the patients and families we serve. Critical to achieving our strategic imperatives is our ability to build a world-class organization and retain an exceptional team in which each member plays a unique and important role. We value diversity, inclusion, and social responsibility where our employees have a strong sense of belonging and contributing, while being empowered to make a real difference. This commitment is company-wide and our Nominating and Corporate Governance Committee charter reflects the Nominating and Corporate Governance Committee’s oversight of our strategies and policies related to our people and diversity, equity

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and inclusion (“DEI”), in addition to the Nominating and Corporate Governance Committee’s oversight of our environmental, social and governance (“ESG”) strategy, initiatives and policies.

We recognize that maintaining an engaged and high-performing workforce who share a connection with the communities we serve is critical to our success. Comradery and cohesion are at the core of who we are as a company, and are integral facets of our human capital strategy. Whether it is coming together throughout the year to connect at our town halls or participating in a global fitness challenge to support the health and well-being of our employees, we take a team approach to our work. We are inspired by the communities we serve, the opportunities to engage and learn from individuals and their families, and the possibilities of what we can achieve together.

We understand that in order to drive innovation, we must continuously improve our people strategies and find ways to foster engagement and growth within our organization. To this end, below are some of our initiatives:

Employee Engagement: We embrace the idea that our employees do their best work when they have equity ownership in the business. Having an engaged and dedicated workforce is essential for us to achieve our goals. Employee engagement ensures that our employees feel passionate about the work they are doing, and with this commitment, we recognize that this is when results happen. It is more apparent than ever that we are all in this together, and as a company, we need to set up our employees for success and continue to cultivate their engagement with our company. We regularly conduct surveys as a means of engaging with employees and gaining their insights. We use the data and input as a tool for improving our human resources management going forward. Engagement is also directly correlated to the interactions our employees have with each other and their teams. Our Wave Activities Committee is a cross-functional team dedicated to organizing activities, such as themed social gatherings, charity and volunteer opportunities, and health and wellness events, which enrich our culture and bring employees together. We also work to ensure that we are deeply aligned with our corporate goals as a company, that functional goals are clear and transparent, and that employees understand how their work contributes to the company’s success.

Employee Health and Safety: Compliance with environmental, health and safety (“EH&S”) laws and regulations forms the basis of the EH&S policy and programs we have in place, which include occupational health and safety measures that apply to all of our employees, contractors and visitors. These programs detail the proactive, risk-based approach that we take to prevent workplace injuries and protect the health and safety of our employees and the communities around us. We have implemented an EH&S management system to monitor and track the effectiveness of our programs, ensure EH&S compliance, respond to incidents and manage corrective actions to reinforce safeguards. Our training programs provide training to our employees that is commensurate with their level of risk exposure and are designed to ensure that employees have the knowledge and equipment available to mitigate risk. Our cross-functional Safety Committee meets monthly to discuss any concerns and ways to improve our EH&S programs. Employees are also required to report any incidents, no matter how small, and are encouraged to voice any health or safety concerns to management or a member of our EH&S team. As we continue to monitor the COVID-19 situation, we have implemented and will continue to implement measures designed to safeguard the health and safety of our employees and our patients, which includes our mandatory COVID-19 vaccination policy.

Professional Development Programs and Opportunities: Employees are our most valuable resource, and we aspire to provide them with opportunities so that they can continue to grow and excel in their functions and our company. Professional growth of our employees leads to engagement and development, and allows us to leverage opportunities to hire and promote key talent from within our organization. We have also implemented a personal development plan program, and leadership and management development programs, which we recognize is a critical part of our future success. In 2022, we initiated “Building Coaching Leaders,” a learning series designed to build strong coaching capabilities and strengthen a manager’s engagement with their teams. Through development planning, we strive for employees at all levels to focus on strengthening the skills required in their current role and potentially their next role. We conduct annual performance reviews for all employees, but, as importantly, we are focused on building a culture of continuous coaching, feedback and open communication between managers and their direct reports throughout the entire year. We provide managers and employees with training on how to conduct effective forward-looking performance conversations and to set effective goals that are specific, measurable, attainable, relevant and timebound (SMART). We provide our employees with unlimited access to LinkedIn Learning, to advance their professional development, interests and goals. Another example where we provide company-wide leadership and development opportunities is through the Wave Learning Series, which was developed to build awareness of all functional areas, special areas of interest or importance, timely subject matters and to expand knowledge of industry trends and other matters of interest and relevance within the biopharmaceutical industry. The Wave Learning Series is conducted through company-wide presentations by employees at various levels, providing opportunities for development and cross-functional exposure for our employees. To further assist our employees, we also offer all full-time employees the option to participate in our Education Assistance Program, where we reimburse employees for tuition and eligible expenses.

Health and Well-Being: We believe that the overall well-being of our employees and ensuring that their basic health and wellness needs are met, is fundamental for us to achieve success as a company. We understand that a key part of our ongoing efforts to prioritize wellness initiatives, includes providing our employees with access to mental health, behavioral health, and/or substance abuse services through our medical plans. We provide an Employee Assistance Program (“EAP”), as a cost-free benefit, which is available to help employees and their household members confidentially manage everyday life, work challenges, stress, and other

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personal issues, by providing consultation, referrals and resources, along with ongoing webinars on various work-life, mental health and wellness topics for employees. In addition, we understand that workplace flexibility is an important component to our employees’ well-being. Throughout the COVID-19 pandemic, safeguarding employee and patient health has been our top priority, as we advance our business through the research and development of our therapeutic candidates. Prioritizing employee safety while achieving our goals has provided us with a greater appreciation for workplace flexibility, which keeps our employees engaged and motivated, while also creating a sense of trust throughout our organization.

Diversity, Equity and Inclusion (“DEI”): Our commitment to maintaining a top-performing company means investing in and creating ongoing opportunities for employee development in a diverse and inclusive workplace. We provide equal employment opportunities without regard to race, color, religion, gender, sexual orientation, national origin, age, disability, veteran status or genetics. In 2021, we formalized our DEI efforts through various initiatives, including the formation of a DEI Steering Group to be intentional about creating and maintaining a diverse, equitable, culturally competent and supportive environment for all of our employees and other stakeholders. Some of our preliminary DEI initiatives included creating opportunities for our employees to be engaged with our DEI initiatives through participation in a cultural assessment survey and creating various focus groups. The data we received from this preliminary work enabled us to create a DEI strategy and define our strategic DEI goals to enhance our overall awareness of DEI and elevate our inclusive leadership and workplace through a broad range of initiatives. Our DEI Steering Group also defined our DEI Vision: At Wave we celebrate diversity and the power of unique perspectives. Together, we are building an inclusive and empowered culture where everyone is valued, able to thrive and feels a sense of belonging. By embracing our differences, we inspire each other, spark innovation and drive meaningful impact for our patients, their families and the communities that we serve. Our DEI Vision will guide us as we further our understanding of the DEI matters that affect our company and stakeholders, and take the appropriate actions to achieve our goals.

We believe that a diverse and inclusive workforce positively impacts our performance, fosters innovation and inspires us to achieve greater results. In addition to this, our intentional focus on DEI continues to strengthen our culture and helps ensure that we continue to cultivate an effective next generation of experienced leaders and managers necessary to execute on our mission and plans for ambitious growth. Hiring for diversity of thought, background and experience, and diversity of personal characteristics such as gender, race and ethnicity, among many others, is intentional, and continues to be an area of focus for us as we build and grow our workforce. Despite the historical lack of institutional emphasis on the importance of girls and women focusing on education in science, technology, engineering and mathematics (“STEM”) and the resulting disproportionate occupation by men in the STEM-educated talent pool, we have prioritized and hired a gender diverse workforce. As of December 31, 2022, women made up approximately 53% of our global workforce and constitute approximately 48% of senior management (defined as vice president level and above). We are also committed to building a racially and ethnically diverse workforce. As of December 31, 2022, racially diverse employees (those self-identifying as Black or African American, Hispanic or Latinx, Asian, or being of two or more races) make up approximately 36% of our global workforce and approximately 22% of senior management (defined as vice president level and above) (20% of our employees did not provide us with this information). In addition, we continue to partner with Project Onramp, which is an organization that is working to bridge the opportunity gap for Massachusetts college students in underserved and minority communities. Through this partnership, we provide students with summer internships.

Community Outreach and Engagement: Our community engagement activities are focused on seeking to better understand the lives of people living with rare disease and identifying opportunities to support the rare disease community. We believe that partnering with, and understanding the lives of individuals impacted by disease and their families and caregivers, connects us more deeply to our mission, differentiates us and enhances our ability to discover and develop potential therapies. Through collaboration with patient communities and advocacy organizations, and participation in community-focused conferences and events, we aim to broaden our understanding of the lived experiences of these individuals and families and to incorporate their perspectives into every aspect of our work. These insights inform the design and execution of our clinical trials, the enrichment of our corporate culture, and other initiatives that make a positive impact on people’s lives. Employee volunteerism is another important component of our community engagement initiatives. We partner with advocacy and service organizations to provide opportunities for employees to contribute directly to our local communities, including through our Wave Service Day and holiday giving drives. By participating in a broad range of volunteer activities, our employees donate time and resources to support individuals and families in the rare disease community and beyond. We also recognize that external factors and current events, including systems and policies, impact our employees, as well as the communities with which we are connected. We prioritize providing mental health resources for our employees, creating forums for dialogue, and finding opportunities to give back to impacted groups.

Rewards and Recognition: We have a multi-tiered awards program, including peer-to-peer recognition, which our employees use to recognize and reward one another for their contributions and achievements, taking into consideration the combination of employees who best exemplify our values and the achievement of results. We believe that providing a rewards program not only increases engagement and performance, but meaningfully recognizes those employees who go above and beyond to positively impact our company and culture. In addition, we offer a team rewards and recognition program to provide another opportunity to recognize and reward collaborative teamwork.

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Compensation, Equity and Benefits (Total Rewards): Compensation programs are one of the most powerful tools available to companies to attract, retain and motivate employees, as well as align their interests with those of shareholders. We have developed a broad-based compensation program that is designed to attract, retain and motivate our employees, while driving sustainable long-term value creation. We seek to deliver performance-driven, market competitive reward opportunities commensurate with company and individual performance. All of our employees receive competitive base salaries, cash bonuses, new hire equity grants and annual long-term incentive grants, in addition to our comprehensive benefits package. We believe that providing employees with an ownership interest in our company through grants of equity awards, further strengthens the level of employee engagement. Furthermore, equity awards help align the interests of our employees with the long-term interests of our shareholders. In addition, we have an Employee Share Purchase Plan (“ESPP”), which provides our employees with an opportunity to purchase shares of our Company at a 15% discount to the market price.

Offering a highly competitive, industry-leading, benefits package is another integral piece of our total rewards package and differentiated employee value proposition. Notably, we provide our employees with access to choice and offer employees a very progressive health insurance package, with no premiums. We also offer a 401(k) plan with matching contributions for all eligible employees. We continue to provide innovative solutions that are key to attracting, engaging and motivating employees, including (i) our excellent benefits and compensation programs and strategies; (ii) our employee well-being approach and strategy; (iii) our health plan and how we have managed this over time; and (iv) internal communications and education around our total rewards strategy.

We will continue to evolve and strengthen our strategies relating to talent, while furthering our investment in our employees, culture, community partnerships and outreach, and other human capital measures.

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Note on the COVID-19 Global Pandemic

The ongoing COVID-19 global pandemic, and variants thereof, continues to have widespread, rapidly evolving, and unpredictable impacts on global societies, economies, financial markets, and business practices. We are closely monitoring the impact of the pandemic and related developments, and our focus remains on safeguarding employee and patient health, while minimizing the negative effects on our business and continuing to advance the research and development of our therapeutic candidates. For discussion regarding the impact of the COVID-19 global pandemic on our business and financial results, see “Risk Factors” in Part I, Item 1A and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of this Annual Report on Form 10-K.

Corporate Information

We were incorporated under the name Wave Life Sciences Pte. Ltd. (Registration No.: 201218209G) under the laws of Singapore on July 23, 2012. On November 16, 2015, we closed our initial public offering. In preparation for our initial public offering, on November 5, 2015, Wave Life Sciences Pte. Ltd. converted from a private limited company to a public limited company known as Wave Life Sciences Ltd. (“Wave”). Wave has four wholly-owned subsidiaries: Wave Life Sciences USA, Inc. (“Wave USA”), a Delaware corporation (formerly Ontorii, Inc.); Wave Life Sciences Japan, Inc. (“Wave Japan”), a company organized under the laws of Japan (formerly Chiralgen., Ltd.); Wave Life Sciences Ireland Limited (“Wave Ireland”), a company organized under the laws of Ireland; and Wave Life Sciences UK Limited (“Wave UK”), a company organized under the laws of the United Kingdom.

Our registered office is located at 7 Straits View #12-00, Marina One East Tower, Singapore 018936, and our telephone number at that address is +65 6236 3388. Our principal office for Wave USA is located at 733 Concord Avenue, Cambridge, MA 02138, and our telephone number at that address is +1-617-949-2900. Our registered office for Wave Japan is 2438 Miyanoura-cho, Kagoshima-shi, Kagoshima pref. 891-1394, Japan. Our registered office for Wave Ireland is One Spencer Dock, North Wall Quay, Dublin 1, D01 X9R7, Ireland. Our registered office for Wave UK is 1 Chamberlain Square CS, Birmingham B3 3AX, United Kingdom.

Information Available on the Internet

Our Internet website address is http://www.wavelifesciences.com. The information contained on, or that can be accessed through, our website is not a part of, or incorporated by reference in, this Annual Report on Form 10-K or our other filings with the SEC. We have included our website address in this Annual Report on Form 10-K solely as an inactive textual reference. We make available free of charge through our website our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Exchange Act. We make these reports available through the “For Investors & Media – SEC Filings” section of our website as soon as reasonably practicable after we electronically file such reports with, or furnish such reports to, the SEC. We also make available, free of charge on our website, the reports filed with the SEC by our executive officers, directors and 10% shareholders pursuant to Section 16 under the Exchange Act as soon as reasonably practicable after copies of those filings are filed with the SEC. You can review our electronically filed reports and other information that we file with the SEC on the SEC’s website at http://www.sec.gov.

In addition, we regularly use our website to post information regarding our business and governance, and we encourage investors to use our website, particularly the information in the section entitled “For Investors & Media,” as a source of information about us.

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Item 1A. Risk Factors

Risk Factors

You should carefully consider the following risk factors, in addition to the other information contained in this Annual Report on Form 10-K, including the section of this report titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and related notes. If any of the events described in the following risk factors and the risks described elsewhere in this Annual Report on Form 10-K occurs, our business, operating results and financial condition could be seriously harmed and the trading price of our ordinary shares could decline. This Annual Report on Form 10-K also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of factors that are described below and elsewhere in this Annual Report on Form 10-K.

Risks Related to Our Financial Results and Capital Requirements

We are a clinical-stage genetic medicines company with a history of losses, and we expect to continue to incur losses for the foreseeable future, and we may never achieve or maintain profitability.

We are a clinical-stage genetic medicines company and have incurred significant operating losses since our incorporation in 2012. Our net loss was $161.8 million and $122.2 million for the fiscal years ended December 31, 2022 and 2021, respectively. As of December 31, 2022 and 2021, we had an accumulated deficit of $967.3 million and $805.5 million, respectively. To date, we have not generated any product revenue. Substantially all of our losses have resulted from expenses incurred in connection with our research and development programs and from general and administrative costs associated with our operations.

We currently have no products on the market and expect that it may be many years, if ever, before we have a product candidate ready for commercialization. We have a robust and diverse pipeline of PN-modified, stereopure oligonucleotides, including programs using our editing, splicing, and silencing modalities. Our lead clinical programs are focused in, and aim to address, muscle diseases (DMD – splicing), hepatic diseases (AATD – editing), and CNS diseases (HD, ALS and FTD – silencing). We have not generated, and do not expect to generate, any product revenue for the foreseeable future, and we expect to continue to incur significant operating losses for the foreseeable future due to the cost of research and development, manufacturing, preclinical studies and clinical trials and the regulatory review process for product candidates. The amount of future losses is uncertain. To achieve profitability, we must successfully develop product candidates, obtain regulatory approvals to market and commercialize product candidates, manufacture any approved product candidates on commercially reasonable terms, establish a sales and marketing organization or suitable third-party alternatives for any approved product and raise sufficient funds to finance our business activities. We may never succeed in these activities and, even if we do, may never generate revenues that are significant or large enough to achieve profitability. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to become and remain profitable would decrease the value of our company and could impair our ability to raise capital, maintain our research and development efforts, expand our business or continue our operations. A decline in the value of our company could also cause our shareholders to lose all or part of their investment.

We will require substantial additional funding, which may not be available on acceptable terms, or at all.

We have used substantial funds to develop our programs and PRISM, our proprietary discovery and drug development platform, and will require substantial funds to conduct further research and development, including preclinical studies and clinical trials of our product candidates, seek regulatory approvals for our product candidates and manufacture and market any products that are approved for commercial sale. We believe that our existing cash and cash equivalents will be sufficient to fund our operations for at least the next 12 months.

Our future capital requirements and the period for which we expect our existing resources to support our operations may vary significantly from what we expect. We do not expect to realize any appreciable revenue from product sales or royalties in the foreseeable future, if at all. Our revenue sources will remain extremely limited unless and until our product candidates complete clinical development and are approved for commercialization and successfully marketed. Because we cannot be certain of the length of time or activities associated with successful development and commercialization of our product candidates, we are unable to estimate the actual funds we will require to develop and commercialize them.

Our future capital requirements will depend on many factors, including, but not limited to, the following:

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To date, we have primarily financed our operations through sales of our securities and our collaborations with third parties. Through December 31, 2022, we have received an aggregate of approximately $1,021.2 million in net proceeds from these transactions, consisting of $630.9 million in net proceeds from public and other registered offerings of our ordinary shares, $301.0 million from our collaborations, exclusive of any potential future milestone and royalty payments, and $89.3 million in net proceeds from private placements of our debt and equity securities. Subsequent to December 31, 2022, we received $170.0 million in cash, of which $120.0 million was an upfront payment under the GSK Collaboration Agreement and $50.0 million was under the GSK Equity Investment.

On March 3, 2022, we filed a new universal shelf registration on Form S-3 with the SEC, which was declared effective by the SEC on May 4, 2022, pursuant to which we registered for sale up to $500.0 million of any combination of our ordinary shares, debt securities, warrants, rights and/or units from time to time and at prices and on terms that we may determine, which we refer to as the “2022 Form S-3.” The 2022 Form S-3 includes a prospectus covering up to approximately $132.0 million in ordinary shares that had not yet been issued or sold under our Sales Agreement with Jefferies LLC (“Jefferies”) for our “at-the-market” equity program. As of March 22, 2023, we have $430.0 million in securities available for issuance under the 2022 Form S-3, including approximately $132.0 million in ordinary shares available for issuance under our at-the-market equity program. As of March 22, 2023, we have received approximately $118.0 million in gross proceeds from our at-the-market equity program. We intend to seek additional funding in the future through collaborations, public or private equity offerings or debt financings, credit or loan facilities or a combination of one or more of these financing sources.

Our ability to raise additional funds will depend on financial, economic and other factors, many of which are beyond our control. We may seek access to the capital and credit markets for working capital, capital expenditure, and other business initiatives. The capital and credit markets have experienced extreme volatility and disruption, which may lead to uncertainty and liquidity issues for both borrowers and investors. In the event of adverse market conditions, or other factors, additional funds may not be available to us on acceptable terms or at all. For example, the global economy has been experiencing increasing interest rates and inflation, which could negatively impact our business and our ability to raise additional funds. If we raise additional funds by issuing equity or convertible debt securities, our shareholders will suffer dilution and the terms of any financing may adversely affect the rights of our shareholders. In addition, as a condition to providing additional funds to us, future investors may demand, and may be granted, rights superior to those of existing shareholders. Debt financing, if available, may involve restrictive covenants limiting our flexibility in conducting future business activities, and, in the event of insolvency, debt holders would be repaid before holders of equity securities received any distribution of corporate assets.

If we are unable to obtain funding on a timely basis or on acceptable terms, we may have to delay, limit or terminate our research and development programs and preclinical studies or clinical trials, limit strategic opportunities or undergo reductions in our workforce or other corporate restructuring activities. We also could be required to seek funds through arrangements with collaborators or others that may require us to relinquish rights to some of our product candidates or technologies that we would otherwise pursue on our own.

Our business may be impacted by macroeconomic conditions, including fears concerning the financial services industry, inflation, rising interest rates and volatile market conditions, and other uncertainties beyond our control.

Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or

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concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems. For example, on March 10, 2023, Silicon Valley Bank failed and was taken into receivership by the Federal Deposit Insurance Corporation; on March 12, 2023, Signature Bank and Silvergate Capital Corp. were each swept into receivership;

the following week, a syndicate of U.S. banks infused $30 billion in First Republic Bank; and later that same week, the Swiss Central Bank provided $54 billion in covered loan and short-term liquidity facilities to Credit Suisse Group AG, all in an attempt to reassure depositors and calm fears of a banking contagion. Our ability to effectively run our business could be adversely affected by general conditions in the global economy and in the financial services industry. Various macroeconomic factors could adversely affect our business, including fears concerning the banking sector, changes in inflation, interest rates and overall economic conditions and uncertainties. A severe or prolonged economic downturn could result in a variety of risks, including our ability to raise additional funding on a timely basis or on acceptable terms. A weak or declining economy could also impact third parties upon whom we depend to run our business. Increasing concerns over bank failures and bailouts and their potential broader effects and potential systemic risk on the banking sector generally and on the biotechnology industry and its participants may adversely affect our access to capital and our business and operations more generally. Although we assess our banking relationships as we believe necessary or appropriate, our access to funding sources in amounts adequate to finance or capitalize our current and projected future business operations could be significantly impaired by factors that affect us, the financial institutions with which we have arrangements directly, or the financial services industry or economy in general
 

Our management has broad discretion over the use of proceeds received from sales of our securities and our collaborations with third parties and the proceeds may not be used effectively.

Our management has broad discretion as to the use of proceeds we receive from conducting sales of our securities and our collaborations with third parties and could use the proceeds for purposes other than those contemplated at the time of such transactions. It is also possible that the proceeds we have received, or may receive, from securities sales and collaborations will be invested in a way that does not yield a favorable, or any, return for us.

Our short operating history may make it difficult for shareholders to evaluate the success of our business to date and to assess our future viability.

We are a clinical-stage genetic medicines company with a limited operating history. We commenced active operations in 2012. Our operations to date have primarily included research and development activities, manufacturing, preclinical and clinical development, patient advocacy activities, business planning and raising capital. We have a robust and diverse pipeline of PN-modified, stereopure oligonucleotides, including programs using our editing, splicing, and silencing modalities. Our lead clinical programs are focused in, and aim to address, muscle diseases (DMD – splicing), hepatic diseases (AATD – editing), and CNS diseases (HD, ALS and FTD – silencing). We have not yet demonstrated our ability to successfully complete pivotal clinical trials, obtain marketing approvals, or conduct sales and marketing activities necessary for successful product commercialization. We have limited experience manufacturing our products at commercial scale or arranging for a third party to do so on our behalf. Typically, it takes many years to develop and commercialize a therapeutic from the time it is discovered to when it is available for treating patients. Further, drug development is a capital-intensive and highly speculative undertaking that involves a substantial degree of risk. You should consider our prospects in light of the costs, uncertainties, delays and difficulties frequently encountered by biotechnology companies in the early stages of clinical development, such as ours. Any predictions about our future success or viability may not be as accurate as they could be if we had a longer operating history or a history of successfully developing and commercializing pharmaceutical products.

We, or third parties upon whom we depend, may face risks related to health epidemics, including the COVID-19 pandemic and variants thereof, which may delay our ability to complete our ongoing clinical trials, initiate additional clinical trials, delay regulatory activities and have other adverse effects on our business and operations.

Since December 2019, multiple countries throughout the world and their economies, including the United States, have been subject to intermittent shutdowns and adversely affected by the COVID-19 global pandemic. We are continuing to evaluate any continued impacts from the global pandemic and the extent to which any responsive measures may materially and adversely affect our business operations and financial condition.

As a clinical-stage company with multiple programs and multiple clinical trials currently underway, the pandemic is impacting the execution of our clinical trials. We have clinical trial sites located in countries that have been affected by COVID-19 and variants thereof. Clinical site initiation and patient enrollment has been delayed due to prioritization of hospital resources in favor of COVID-19 patients and difficulties in recruiting clinical site investigators and clinical site staff. Some patients have not been able to travel or gain access to clinical trial sites due to local restrictions. Similarly, our ability to recruit and retain patients and principal investigators

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and site staff who, as healthcare providers, may have heightened risk of exposure to COVID-19, has been negatively impacted, which has delayed the timelines of our clinical trial operations.

We rely upon third parties for many aspects of our business, including the raw materials used to make our product candidates and the conduct of our clinical trials and preclinical studies. While we have built up inventory to assist us through this uncertain operating environment, our suppliers may be disrupted now or in the future, which may affect our ability to procure items that are essential for our research and development activities and may cause pricing increases, inflation, and significant disruptions to our business.

The COVID-19 global pandemic, including any emerging variants of COVID-19, is continuing to evolve and is subject to change. While we have adapted our processes to lessen the impact that COVID-19, and variants thereof, may have on our business, any potential delays or long-term impacts on our business, our clinical trials, healthcare systems or the global economy are highly uncertain. These effects may materially adversely affect our business, financial condition, results of operations, and prospects.

Risks Related to the Discovery, Manufacturing, Development and Commercialization of Our Product Candidates

The approach we are taking to discover and develop oligonucleotides is novel and may never lead to marketable products.

We have concentrated our efforts and research and development activities on oligonucleotides and enhancing PRISM, our proprietary discovery and drug development platform. PRISM enables us to target genetically defined diseases with stereopure oligonucleotides across multiple therapeutic modalities. Our future success depends on the successful development of stereopure oligonucleotides and the effectiveness of PRISM. The scientific discoveries that form the basis for our efforts to discover and develop new product candidates, including our discoveries about the relationships between oligonucleotide stereochemistry and pharmacology, are relatively new. We use PRISM to screen candidates and optimize pharmacologic profiles based on predefined design principles, which reflect a deep understanding of how the interplay among oligonucleotide sequence, chemistry and backbone stereochemistry impacts key pharmacological properties. The scientific evidence to support the feasibility of developing medicines based on these discoveries is limited. Skepticism as to the feasibility of developing oligonucleotides generally has been, and may continue to be, expressed in scientific literature. In addition, decisions by other companies with respect to their oligonucleotide development efforts may increase skepticism in the marketplace regarding the potential for oligonucleotides.

A number of clinical trials for oligonucleotide products conducted by other companies have not been successful, but some have received regulatory approval. The pharmacological properties ascribed to the investigational compounds we are testing in laboratory studies may not be positively demonstrated in clinical trials in patients, and they may interact with human biological systems in unforeseen, ineffective or harmful ways. If our product candidates prove to be ineffective, unsafe or commercially unviable, PRISM and our pipeline would have little, if any, value, which would substantially harm our business, financial condition, results of operations and prospects. In addition, our approach, which focuses on using oligonucleotides for drug development, as opposed to multiple or other, more advanced proven technologies, and new products and technologies that may enter the market, may expose us to additional financial risks and make it more difficult to raise additional capital if we are not successful in developing one or more oligonucleotides that receive regulatory approval.

Because we are developing oligonucleotides, which are considered a relatively new class of drugs, there is increased risk that the outcome of our clinical trials will not be sufficient to obtain regulatory approval.

The FDA and comparable ex-U.S. regulatory agencies have relatively limited experience with oligonucleotides, which may increase the complexity, uncertainty and length of the regulatory review process for our product candidates. To date, the FDA has approved 15 oligonucleotides for marketing and commercialization. Even though the FDA issued in December 2021 two draft guidance documents relating to IND submissions for individualized antisense oligonucleotide drugs for severely debilitating or life-threatening genetic diseases, one with clinical focus, the other with chemistry manufacturing and controls focus, and in June 2022 a draft guidance on clinical pharmacology considerations for the development of oligonucleotide therapeutics, the FDA and its foreign counterparts have not yet established any definitive policies, practices or guidelines in relation to overall development considerations for oligonucleotide drugs. The general lack of policies, practices or guidelines specific to oligonucleotides may hinder or slow review by the FDA or other foreign homologues of any regulatory filings that we may submit. Moreover, the FDA or other foreign homologues may respond to these submissions by defining requirements we may not have anticipated. Addressing such requirements could lead to significant delays in the development of our product candidates. In addition, because there may be approved treatments for some of the diseases for which we may seek approval, in order to receive regulatory approval, we may need to demonstrate through clinical trials that the product candidates we develop to treat these diseases, if any, are not only safe and effective, but safer or more effective than existing products. Furthermore, in recent years, there has been increased public and political pressure on the FDA with respect to the approval process for new drugs. As a result of the foregoing factors, we may never receive regulatory approval to market and commercialize any product candidate.

Even if we obtain regulatory approval, the approval may be for disease indications or patient populations that are not as broad as we intended or desired or may require labeling that includes significant use or distribution restrictions or safety warnings. We may be

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required to perform additional or unanticipated clinical trials to obtain regulatory approval or be subject to additional post-marketing studies or other requirements to maintain such approval. As a result, we may never succeed in developing a marketable product, we may not become profitable and the value of our ordinary shares could decline.

Our preclinical studies and clinical trials may not be successful. If we are unable to commercialize our product candidates or experience significant delays in doing so, our business will be materially harmed.

We have a robust and diverse pipeline of PN-modified, stereopure oligonucleotides, including programs using our editing, splicing, and silencing modalities. Our lead clinical programs are focused in, and aim to address, muscle diseases (DMD – splicing), hepatic diseases (AATD – editing), and CNS diseases (HD, ALS and FTD – silencing).

However, we currently have no products on the market. We have invested a significant portion of our efforts and financial resources in the identification and preclinical and clinical development of our oligonucleotides, the development of PRISM, including our ADAR editing capability, and our novel PN backbone chemistry modifications, and the continued growth of our manufacturing capabilities. Our ability to generate product revenue, which we do not expect will occur for many years, if ever, will depend heavily on the successful development, regulatory approvals, and eventual commercialization of our product candidates. Our success will depend on several factors, including the following:

If we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully commercialize our product candidates, which would materially harm our business.

We may not be able to conduct clinical trials successfully due to various process-related factors that could negatively impact our business plans.

The successful initiation and completion of any of our clinical trials, within timeframes consistent with our business plans, is dependent on various factors, which include, but are not limited to, our ability to:

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If we are not able to manage the clinical trial process successfully, our business plans could be delayed or be rendered unfeasible for us to execute within our planned or required time frames, or at all.

If we cannot successfully manufacture our product candidates for our research and development and preclinical activities, or manufacture sufficient amounts of our product candidates to meet our clinical requirements and timelines, our business may be materially harmed.

In order to develop our product candidates, apply for regulatory approvals and commercialize our product candidates, we will need to develop, contract for, or otherwise arrange for the necessary manufacturing capabilities. In September 2016, we entered into a lease for a multi-use facility of approximately 90,000 square feet in Lexington, Massachusetts to provide internal cGMP manufacturing capabilities and increase control and visibility of our drug substance supply chain, and we began cGMP manufacturing in this facility at the beginning of 2018. This facility supplements our existing Cambridge, Massachusetts laboratory and office space headquarters, enhances our ability to secure drug substance for current and future development activities and may provide commercial-scale manufacturing capabilities. However, while we have established and continue to enhance our internal cGMP manufacturing capabilities, we have limited experience manufacturing drug substance on a commercial scale, and we will incur significant costs to develop this expertise internally.

In addition to the oligonucleotides that we manufacture internally, we may utilize CMOs to manufacture the oligonucleotides required for our preclinical studies and clinical trials. There are a limited number of manufacturers that supply oligonucleotides. There are risks inherent in pharmaceutical manufacturing that could affect our ability or the ability of our CMOs to meet our delivery time requirements or provide adequate amounts of material to meet our clinical trial demands on our projected timelines. Included in these risks are potential synthesis and purification failures and/or contamination during the manufacturing process, as well as other issues with our facility or the CMOs’ facilities and ability to comply with the applicable manufacturing requirements and quality standards, which could result in unusable product and cause delays in our manufacturing timelines and ultimately delay our clinical trials, as well as result in additional expense to us. To manufacture our oligonucleotides, we rely on third parties to supply the required raw materials. We will likely need to secure alternative suppliers for these raw materials, and such alternative suppliers are limited and may not be readily available, or we may be unable to enter into agreements with them on reasonable terms and in a timely manner. For example, we source certain materials used in the manufacture of our products from China and other countries outside of the United States; the coronavirus outbreak or other similar global disruptions has made access to our existing supply chain difficult and further supply chain disruptions could impact our business. Additionally, our cost of goods development is at an early stage. The actual cost to manufacture and process our product candidates could be greater than we expect and could materially and adversely affect the commercial viability of our product candidates.

The process of manufacturing oligonucleotides is complex and we may encounter difficulties in production, particularly with respect to process development or scaling-up of our manufacturing capabilities.

The process of manufacturing oligonucleotides is complex, highly-regulated and subject to multiple risks. The complex processes associated with the manufacture of our product candidates expose us to various manufacturing challenges and risks, which may include delays in manufacturing adequate supply of our product candidates, limits on our ability to increase manufacturing capacity, and the potential for product failure and product variation in quality that may interfere with preclinical studies and clinical trials, along with additional costs. We also may make changes to our manufacturing process at various points during development, and even after commercialization, for various reasons, such as optimizing costs, achieving scale, decreasing processing time, increasing

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manufacturing success rate, or other reasons. Such changes carry the risk that they will not achieve their intended objectives, and any of these changes could cause our product candidates to perform differently and affect the results of current or future clinical trials, or the performance of the product, once commercialized. In some circumstances, changes in the manufacturing process may require us to perform ex vivo comparability studies, and/or conduct animal studies, and to collect additional data from patients prior to undertaking more advanced clinical trials. For instance, changes in our process during the course of clinical development may require us to show the comparability of the product used in earlier clinical trials or at earlier portions of a trial to the product used in later clinical trials or later portions of the trial. We may also make further changes to our manufacturing process before or after commercialization, and such changes may require us to show the comparability of the resulting product to the product produced via earlier manufacturing processes and supplied in clinical studies. We may be required to collect additional preclinical and/or clinical data from any modified process prior to obtaining marketing approval for the product candidate produced with such modified process. If preclinical and/or clinical data are not ultimately comparable to those seen in the earlier trials, we may be required to make further changes to our process and/or undertake additional clinical testing, either of which could significantly delay the clinical development or commercialization of the associated product candidate.

We have a robust and diverse pipeline of PN-modified, stereopure oligonucleotides, including programs using our editing, splicing, and silencing modalities. Our lead clinical programs are focused in, and aim to address, muscle diseases (DMD – splicing), hepatic diseases (AATD – editing), and CNS diseases (HD, ALS and FTD – silencing). Although we continue to build on our experience in manufacturing oligonucleotides, we have limited experience as a company manufacturing product candidates for commercial supply. We may never be successful in manufacturing product candidates in sufficient quantities or with sufficient quality for commercial use. Our manufacturing capabilities could be affected by cost-overruns, unexpected delays, equipment failures, labor shortages, operator error, natural disasters, unavailability of qualified personnel, difficulties with logistics and shipping, problems regarding yields or stability of product, contamination or other quality control issues, power failures, and numerous other factors that could prevent us from realizing the intended benefits of our manufacturing strategy and have a material adverse effect on our business.

Furthermore, compliance with cGMP requirements and other quality issues may arise during our internal efforts to scale-up manufacturing, and with our current or any future CMOs. If contaminants are discovered in our supply of our product candidates or in our manufacturing facilities or those of our CMOs, such manufacturing facilities may need to be closed for an extended period of time to investigate and remedy the contamination. We cannot assure you that any stability failures or other issues relating to the manufacture of our product candidates will not occur in the future. Additionally, we and our CMOs may experience manufacturing difficulties due to resource constraints or as a result of labor disputes or unstable political environments. If we or our CMOs were to encounter any of these difficulties, our ability to provide our product candidate to patients in clinical trials, or to provide product for treatment of patients once approved, would be jeopardized.

We may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success.

Because we have limited financial resources, we intend to focus on developing product candidates for specific indications that we identify as most likely to succeed, in terms of both regulatory approval and commercialization. As a result, we may forego or delay pursuit of opportunities with other product candidates or for other indications that may prove to have greater commercial potential. Our resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitable market opportunities. Our spending on current and future research and development programs and product candidates for specific indications may not yield any commercially viable products. If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate.

Any product candidates we develop may fail in preclinical or clinical development or be delayed to a point where they do not become commercially viable.

Before obtaining regulatory approval for the commercial distribution of any of our product candidates, we must conduct, at our own expense, extensive preclinical studies and clinical trials to demonstrate the safety and efficacy in humans of our product candidates. Preclinical and clinical testing are expensive, difficult to design and implement, can take many years to complete, are uncertain as to outcome, and the historical failure rate for drugs in preclinical and clinical development is high. For example, we depend on the availability of non-human primates to conduct certain preclinical studies. Over the past several years there has been an increasing global shortage of non-human primates available for drug development that has matured into an acute global supply chain issue. The supply of these non-human primates is currently constrained due to factors such as their limited worldwide availability, domestic regulatory restrictions and trade relations. If we are unable to obtain access to a sufficient supply of these non-human primates in a timely manner or at all, our timelines and our ability to complete preclinical testing and submit CTA applications may be adversely affected.

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We, the FDA or comparable foreign regulatory authorities or an IRB, or similar foreign review board or ethics committee, may suspend clinical trials of a product candidate at any time for various reasons, including if we or they believe the healthy volunteer subjects or patients participating in such trials are being exposed to unacceptable health risks. Among other reasons, unacceptable side effects or other more serious adverse events of a product candidate in healthy volunteer subjects or patients in a clinical trial could result in the FDA or comparable foreign regulatory authorities suspending or terminating the trial and refusing to approve a particular product candidate for any or all indications of use.

Clinical trials also require the review, oversight and approval of IRBs or ethics committees, which review the clinical protocols and informed consent form for investigations that will be conducted at their institutions in order to protect the rights and welfare of human subjects. Inability to obtain or delay in obtaining IRB approval can prevent or delay the initiation and completion of clinical trials at particular sites. Furthermore, failure to provide information to the IRB and relevant regulatory authorities, as required throughout the study, such as emergent safety reports and annual updates, may result in suspension of the approval of the trial. Our product candidates may encounter problems during clinical trials that will cause us or regulatory authorities to delay, suspend or terminate these trials, or that will delay or confound the analysis of data from these trials. If we experience any such problems, we may not have the financial resources to continue development of the product candidate that is affected or any of our other product candidates. We may also lose, or be unable to enter into, collaborative arrangements for the affected product candidate and for other product candidates we are developing. The development of one or more of our product candidates can fail at any stage of testing. We may experience numerous unforeseen events during, or as a result of, preclinical studies and clinical trials that could delay or prevent regulatory approval or our ability to commercialize our product candidates, including:

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If we do not successfully conduct clinical development, we will not be able to market and sell products derived from our product candidates and to generate product revenues. Even if we do successfully complete clinical trials, those results are not necessarily predictive of results of additional trials that may be needed before we can submit an application for regulatory approval to the FDA or foreign regulatory agencies. If the development of any of our product candidates fails or is delayed to a point where such product candidate is no longer commercially viable, our business may be materially harmed.

Results of preclinical studies and early clinical trials may not be predictive of results of future clinical trials.

The results from preclinical studies or early clinical trials of a product candidate may not predict the results that will be obtained in subsequent subjects or in subsequent clinical trials of that product candidate or any other product candidate. The design of a clinical trial can determine whether its results will support approval of a product candidate and flaws in the design of a clinical trial may not become apparent until the clinical trial is well advanced. In addition, preclinical and clinical data are often susceptible to varying interpretations and analyses. Product candidates that seemingly perform satisfactorily in preclinical studies may nonetheless fail to reach late development stages or obtain regulatory approval for marketing. For example, our preclinical studies for suvodirsen yielded positive results. However, in December 2019, the interim analysis of the Phase 1 open-label extension (OLE) study of suvodirsen for patients with DMD showed no change from baseline in dystrophin expression and resulted in our discontinuation of the suvodirsen program. There is a high failure rate for drugs proceeding through clinical trials. A number of companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in clinical development even after achieving promising results in earlier studies, and any such setbacks in our clinical development could negatively affect our business and operating results.

If we experience delays or difficulties in the enrollment of patients in clinical trials, our receipt of necessary regulatory approvals could be delayed or prevented.

Clinical trials of a new product candidate require the enrollment of a sufficient number of patients, including patients who are suffering from the disease the product candidate is intended to treat and who meet other eligibility criteria. Rates of patient enrollment are affected by many factors, including the COVID-19 global pandemic or emerging or future variants of COVID-19, the size of the patient population, the age and condition of the patients, the stage and severity of disease, the nature and requirements of the protocol, the proximity of patients to clinical sites, the availability of effective treatments for the relevant disease, and the eligibility criteria for the clinical trial. Delays or difficulties in patient enrollment or difficulties retaining trial participants, including as a result of the availability of existing or other investigational treatments, can result in increased costs, longer development times or termination of a clinical trial.

In addition, our success may depend, in part, on our ability to identify patients who qualify for our clinical trials, or are likely to benefit from any medicines that we may develop, which will require those potential patients to undergo a screening assay, which we also refer to as a companion diagnostic test, for the presence or absence of a particular genetic sequence. For example, in HD, we are conducting a clinical trial for WVE-003, which targets a SNP associated with the mutant allele of the HTT gene. Approximately 40% of the HD patient population carry this SNP. We have developed a novel screening assay that is intended to identify whether a patient has the particular SNP that our product candidate is targeting, and partnered with a third party for testing in future trials. If we, or any third parties that we engage to assist us are unable to successfully identify patients with the appropriate SNP that we are targeting, the percentage of patients with the SNP we are targeting is lower than expected, or we experience delays in testing, we may not realize the full commercial potential of any product candidates we develop.

If we are unable to successfully develop or obtain regulatory approval for companion diagnostic tests for our product candidates, or experience significant delays in doing so, our clinical trials may be delayed and our business could be materially harmed.

The development programs for some of our product candidates contemplate the development of companion diagnostic tests, which are assays or tests to identify an appropriate patient population. The success of certain of our product candidates will depend on several factors, including the successful development of, and ability to obtain regulatory approval for, companion diagnostic tests that will be used to screen and identify the right patients for our product candidates. Our goal is to develop and commercialize disease-modifying medicines for genetically defined diseases with a high degree of unmet medical need, and to become a fully integrated genetic medicines company. The target patient populations for several of our product candidates are relatively small, and it will be difficult to successfully identify the appropriate patients for whom our product candidates are being designed without performant, fit-for-purpose, accessible, relatively inexpensive, and easy-to-use companion diagnostic tests.

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Companion diagnostic tests are subject to regulation by the FDA and similar regulatory authorities outside the United States as medical devices, often in vitro devices, and require separate regulatory authorization prior to commercialization. We are not a medical device company, and we have limited experience developing medical devices. A more detailed description of the FDA approval process for companion diagnostic tests is included under “Business – Government Regulation – In Vitro Diagnostic Tests for Biomarkers.” Given our limited experience in developing and commercializing companion diagnostic tests, we may seek to collaborate with third parties to assist us in the design, manufacture, regulatory authorization and commercialization of the companion diagnostic tests for some of our product candidates. In November 2019, we entered into a collaboration with Asuragen, Inc. (“Asuragen”) for the development and commercialization of companion diagnostics for our allele-selective product candidate in HD. We, Asuragen and other potential collaborators may encounter difficulties in developing and obtaining approval for the companion diagnostic tests, including issues relating to sensitivity/specificity, analytical validation, reproducibility, or clinical validation. Any delay or failure by us or our collaborators to develop or obtain regulatory authorization of the relevant companion diagnostic tests could delay or prevent approval of our product candidates. If we, Asuragen or any other third parties that we engage to assist us, are unable to successfully develop, validate, and commercialize companion diagnostic tests for our drug candidates, or experience delays in doing so, our clinical trials and our business could be materially harmed.

We may be unable to obtain regulatory approval in the United States or foreign jurisdictions and, as a result, be unable to commercialize our product candidates and our ability to generate revenue will be materially impaired.

Our product candidates are subject to extensive governmental regulations relating to, among other things, research, testing, development, manufacturing, quality, safety, efficacy, approval, recordkeeping, reporting, labeling, storage, packaging, advertising and promotion, pricing, marketing and distribution of drugs. Rigorous preclinical studies and clinical trials, and an extensive regulatory approval process are required to be successfully completed in the United States and in many foreign jurisdictions before a new drug can be marketed. Satisfaction of these and other regulatory requirements is costly, time consuming, uncertain, and subject to a continuously evolving regulatory environment and unanticipated delays. It is possible that none of the product candidates we may develop will obtain the regulatory approvals necessary for us or our collaborators to begin selling them.

The time required to obtain FDA and other approvals is unpredictable but typically takes many years following the commencement of clinical trials, depending upon the type, complexity and novelty of the product candidate. The standards that the FDA and its foreign counterparts use when regulating companies such as ours are not always applied predictably or uniformly and can change. Any analysis we perform of data from chemistry, manufacturing and controls, preclinical and clinical activities is subject to confirmation and interpretation by regulatory authorities, which could delay, limit or prevent regulatory approval. We may also encounter unexpected delays or increased costs due to new government regulations, for example, from future legislation or administrative action, or from changes in FDA policy during the period of product development, clinical trials and FDA regulatory review. It is impossible to predict whether legislative changes will be enacted, or whether FDA or foreign regulations, guidance or interpretations will be changed, or what the impact of such changes, if any, may be.

Any delay or failure in obtaining required approvals could adversely affect our ability to generate revenues from the particular product candidate for which we are seeking approval. Furthermore, any regulatory approval to market a product may be subject to limitations on the approved uses for which we may market the product or the labeling or other restrictions. In addition, the FDA has the authority to require a Risk Evaluation and Mitigation Strategy (“REMS”), as a condition of approval, which may impose further requirements or restrictions on the distribution or safe use of an approved drug, such as limiting prescribing rights to certain physicians or medical centers that have undergone specialized training, limiting treatment to patients as specially defined by the indication statement or who meet certain safe-use criteria, and requiring treated patients to enroll in a registry, among other requirements. These limitations and restrictions may limit the size of the market for the product and affect reimbursement by third-party payors.

We are also subject to numerous foreign regulatory requirements governing, among other things, the conduct of clinical trials, manufacturing and marketing authorization, pricing and payment. The foreign regulatory approval process varies among countries and may include all of the risks associated with FDA approval described above, as well as risks attributable to the satisfaction of local regulations in foreign jurisdictions. Approval by the FDA does not ensure approval by comparable regulatory authorities outside of the United States and vice versa.

If we are granted orphan drug designations in the United States for any of our product candidates, there can be no guarantee that we will maintain orphan status for these product candidates or receive approval for any product candidate with an orphan drug designation.

Subject to receiving approval from the FDA of an NDA or Biologics License Application (“BLA”), products granted orphan drug designation are provided with seven years of orphan marketing exclusivity in the United States, meaning the FDA generally will not approve applications for other product candidates for the same orphan indication that contain the same active ingredient.

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We are not guaranteed to maintain or receive orphan designation for our current or future product candidates, and if our product candidates that were granted orphan designation were to lose their status as an orphan drug or the orphan marketing exclusivity provided to it in the United States, our business and results of operations could be materially adversely affected. While orphan status for any of our products, if granted or maintained, would provide market exclusivity in the United States for the time periods specified above, we would not be able to exclude other companies from manufacturing and/or selling products using the same active ingredient for the same indication beyond the exclusivity period applicable to our product on the sole basis of orphan drug status. In addition, orphan exclusivity does not block the approval of a different drug or biologic for the same rare disease or condition, nor does it block the approval of the same drug or biologic for different conditions. Even if we are the first to obtain approval of an orphan product candidate and are granted exclusivity in the United States, there are circumstances under which a later competitor product may be approved for the same indication during the period of marketing exclusivity, such as if the later product is shown to be clinically superior to our product or if we are not able to provide a sufficient quantity of the orphan drug.

Even if we obtain regulatory approvals, our marketed drugs will be subject to ongoing regulatory oversight. If we fail to comply with continuing U.S. and foreign requirements, our approvals, if obtained, could be limited or withdrawn, we could be subject to other penalties, and our business would be seriously harmed.

Following any initial regulatory approval of any drugs we may develop, we will also be subject to continuing regulatory oversight, including the review of adverse drug experiences and safety data that are reported after our drug products are made commercially available. This would include results from any post-marketing studies or surveillance to monitor the safety and efficacy of the drug product required as a condition of approval or agreed to by us. Any regulatory approvals that we receive for our product candidates may also be subject to limitations on the approved uses for which the product may be marketed. Other ongoing regulatory requirements include, among other things, submissions of safety and other post-marketing information and reports, registration and listing, as well as continued maintenance of our marketing application, compliance with cGMP requirements and quality oversight, compliance with post-marketing commitments, and compliance with GCP for any clinical trials that we conduct post-approval. Failure to comply with these requirements could result in warning or untitled letters, criminal or civil penalties, recalls, or product withdrawals. In addition, we are conducting our clinical trials and we intend to seek approval to market our product candidates in jurisdictions outside of the United States, and therefore will be subject to, and must comply with, regulatory requirements in those jurisdictions.

The FDA has significant post-market authority, including, for example, the authority to require labeling changes based on new safety information and to require post-market studies or clinical trials for a variety of reasons. The FDA also has the authority to require a REMS plan after approval, which may impose further requirements or restrictions on the distribution or use of an approved drug.

We, our CMOs, and the manufacturing facilities we use to make our product candidates will also be subject to ongoing assessment of product quality, compliance with cGMP, and periodic inspection by the FDA and potentially other regulatory agencies. We or our CMOs may not be able to comply with applicable cGMP regulations or similar regulatory requirements outside of the United States. Our failure, or the failure of our CMOs, to comply with applicable regulations could result in regulatory actions, such as the issuance of FDA Form 483 notices of observations, warning letters or sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of product candidates or drugs, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supplies of our products. We may not have the ability or capacity to manufacture material at a broader commercial scale in the future. We and our CMOs currently manufacture a limited supply of clinical trial materials. Reliance on CMOs entails risks to which we would not be subject if we manufactured all of our material ourselves, including reliance on the CMO for regulatory compliance. Our product promotion and advertising will also be subject to regulatory requirements and continuing regulatory review.

If we or our collaborators, manufacturers or service providers fail to comply with applicable continuing regulatory requirements in the United States or foreign jurisdictions in which we may seek to market our products, we or they may be subject to, among other things, fines, warning letters, holds on clinical trials, refusal by the FDA or comparable foreign regulatory authorities to approve pending applications or supplements to approved applications, suspension or withdrawal of regulatory approval, product recalls and seizures, refusal to permit the import or export of products, operating restrictions, injunction, consent decree, civil penalties and criminal prosecution.

Even if we receive regulatory approval to market our product candidates, the market may not be receptive to our product candidates upon their commercial introduction, which will prevent us from becoming profitable.

Our product candidates are based upon new discoveries, technologies and therapeutic approaches. Key participants in pharmaceutical marketplaces, such as physicians, third-party payors and consumers, may not adopt a product intended to improve therapeutic results that is based on the technology employed by oligonucleotides. As a result, it may be more difficult for us to convince the medical community and third-party payors to accept and use our product, or to provide favorable reimbursement.

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Other factors that we believe will materially affect market acceptance of our product candidates include:

In addition, our estimates regarding the potential market size may be materially different from what we currently expect at the time we commence commercialization, which could result in significant changes in our business plan and may significantly harm our results of operations and financial condition.

The pharmaceutical industry is intensely competitive. If we are unable to compete effectively with existing drugs, new treatment methods and new technologies, we may be unable to commercialize successfully any drugs that we develop.

The pharmaceutical industry is intensely competitive and rapidly changing. Many large pharmaceutical and biotechnology companies, academic institutions, governmental agencies and other public and private research organizations are pursuing the development of novel drugs for the same diseases that we are targeting or expect to target. Many of our competitors have:

We will face intense competition from drugs that have already been approved and accepted by the medical community for the treatment of the conditions for which we may develop drugs. We also expect to face competition from new drugs that enter the market. We believe a significant number of drugs are currently under development, and may become commercially available in the future, for the treatment of conditions that our current or future product candidates are or may be designed to treat. These drugs may be more effective, safer, less expensive, or marketed and sold more effectively, than any products we develop.

Our competitors may develop or commercialize products with significant advantages over any products we are able to develop and commercialize based on many different factors, including:

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Our competitors may therefore be more successful in commercializing their products than we are, which could adversely affect our competitive position and business. Competitive products may make any products we develop obsolete or noncompetitive before we can recover the expenses of developing and commercializing our product candidates. Such competitors could also recruit our employees, which could negatively impact our level of expertise and our ability to execute on our business plan.

If we or our collaborators, manufacturers, service providers or other third parties fail to comply with applicable healthcare laws and regulations, we or they could be subject to enforcement actions, which could affect our ability to develop, market and sell our products and may harm our reputation.

We are currently, or may in the future, be subject to federal, state, local, and comparable foreign healthcare laws and regulations relating to areas such as fraud and abuse and patients’ rights. These laws may constrain the business or financial arrangements and relationships through which we conduct our operations, including how we research, market, sell and distribute our products for which we obtain marketing approval. These laws and regulations include:

If our operations are found to be in violation of any such requirements, we may be subject to penalties, including civil or criminal penalties, criminal prosecution, monetary damages, the curtailment or restructuring of our operations, loss of eligibility to obtain approvals from the FDA, exclusion from participation in federal healthcare programs including Medicare and Medicaid, the imposition of a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services,

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disgorgement, individual imprisonment, contractual damages, reputational harm, and diminished profits and future earnings, any of which could adversely affect our financial results and adversely affect our ability to operate our business. We intend to develop and implement a comprehensive corporate compliance program prior to the commercialization of our product candidates. Although effective compliance programs can mitigate the risk of investigation and prosecution for violations of these laws, these risks cannot be entirely eliminated. Any action against us for an alleged or suspected violation could cause us to incur significant legal expenses, could divert our management’s attention from the operation of our business, and could harm our reputation, even if our defense is successful. In addition, achieving and sustaining compliance with applicable laws and regulations may be costly to us in terms of money, time and resources.

If we or our collaborators, manufacturers or service providers fail to comply with applicable federal, state or foreign laws or regulations, we could be subject to enforcement actions, which could affect our ability to develop, market and sell our products successfully and could harm our reputation and lead to reduced acceptance of our products by the market. These enforcement actions include, among others:

Moreover, federal, state or foreign laws or regulations are subject to change, and while we, our collaborators, manufacturers and/or service providers currently may be compliant, that could change due to changes in interpretation, prevailing industry standards or other reasons.

Any drugs we develop may become subject to unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives, thereby harming our business.

Because our product candidates represent new approaches to the treatment of genetic-based diseases, we cannot be sure that coverage and reimbursement will be available for, or accurately estimate the potential revenue from, our product candidates or assure that coverage and reimbursement will be available for any product that we may develop. The regulations that govern marketing approvals, pricing and reimbursement for new drugs vary widely from country to country. Some countries require approval of the sale price of a drug before it can be marketed. In many countries, the pricing review period begins after marketing or product licensing approval is granted. In some foreign markets, prescription pharmaceutical pricing remains subject to continuing governmental control even after initial approval is granted. We are monitoring these regulations as several of our programs move into later stages of development; however, many of our programs are currently in the earlier stages of development and we will not be able to assess the impact of price regulations for a number of years. As a result, we might obtain regulatory approval for a product in a particular country, but then be subject to price regulations that could delay our commercial launch of the product and negatively impact any potential revenues we may be able to generate from the sale of the product in that country and potentially in other countries due to reference pricing.

Our ability to commercialize any products successfully will also depend in part on the extent to which coverage and adequate reimbursement/payment for these products and related treatments will be available from government health administration authorities, private health insurers and other organizations. Even if we succeed in bringing one or more products to the market, these products may

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not be considered medically necessary and/or cost-effective, and the amount reimbursed for any products may be insufficient to allow us to sell our products on a competitive basis. At this time, we are unable to determine their cost effectiveness or the likely level or method of reimbursement for our product candidates. Increasingly, third-party payors, such as government and private insurance plans, are requiring that drug companies provide them with predetermined discounts from list prices, and are seeking to reduce the prices charged or the amounts paid for pharmaceutical products. If the price we are able to charge for any products we develop, or the payments provided for such products, is inadequate in light of our development and other costs, our return on investment could be adversely affected.

We currently expect that any drugs we develop may need to be administered under the supervision of a physician on an outpatient basis. Under currently applicable U.S. law, certain drugs that are not usually self-administered (such as most injectable drugs) may be eligible for coverage under the Medicare Part B program if:

There may be significant delays in obtaining coverage for newly-approved drugs, and coverage may be more limited than the indications for which the drug is approved by the FDA or comparable foreign regulatory authorities. Patients who are prescribed medications for the treatment of their conditions, and their prescribing physicians, generally rely on third-party payors to pay all or part of the costs associated with their prescription drugs. Patients are unlikely to use our products unless coverage is provided and payment is adequate to cover all or a significant portion of the cost of our products. Therefore, coverage and adequate payment is critical to new product acceptance. Coverage decisions may depend upon clinical and economic standards that disfavor new drug products when more established or lower cost therapeutic alternatives are already available or subsequently become available. Moreover, eligibility for coverage does not imply that any drug will be paid for in all cases or at a rate that covers our costs, including research, development, manufacture, sale and distribution. Interim payments for new drugs, if applicable, may also not be sufficient to cover our costs and may not be made permanent. Reimbursement may be based on payments allowed for lower-cost drugs that are already reimbursed, may be incorporated into existing payments for other services and may reflect budgetary constraints or imperfections in Medicare data. Net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the United States. Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement rates. However, no uniform policy requirement for coverage and reimbursement for drug products exists among third-party payors in the United States. Therefore, coverage and reimbursement for drug products can differ significantly from payor to payor. As a result, the coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our products to each payor separately, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance. Our inability to promptly obtain coverage and adequate reimbursement rates from both government-funded and private payors for new drugs that we develop and for which we obtain regulatory approval could adversely affect our operating results, our ability to raise capital needed to commercialize products, and our overall financial condition.

We believe that the efforts of governments and third-party payors to contain or reduce the cost of healthcare and legislative and regulatory proposals to broaden the availability of healthcare will continue to affect the business and financial condition of pharmaceutical and biopharmaceutical companies. A number of legislative and regulatory changes in the healthcare system in the United States and other major healthcare markets have been proposed and/or adopted in recent years, and such efforts have expanded substantially in recent years. These developments have included prescription drug benefit legislation that was enacted in 2003 and took effect in January 2006, healthcare reform legislation enacted by certain states, and major healthcare reform legislation that was passed by Congress and enacted into law in the United States in 2010. These developments could, directly or indirectly, affect our ability to sell our products, if approved, at a favorable price.

In particular, in March 2010, the Patient Protection and Affordable Care Act (the “ACA”) was signed into law. This legislation changed the system of healthcare insurance and benefits and was intended to broaden access to healthcare coverage, enhance remedies against fraud and abuse, add transparency requirements for the healthcare and health insurance industries, impose taxes and fees on the healthcare industry, impose health policy reforms, and control costs. This law also contains provisions that would affect companies in the pharmaceutical industry and other healthcare related industries by imposing additional costs and changes to business practices. Since its enactment, there have been judicial and Congressional challenges to certain aspects of the ACA. The uncertainty around the future of the ACA, and in particular the impact to reimbursement levels, may lead to uncertainty or delay in the purchasing decisions of our customers, which may in turn negatively impact our product sales. We continue to evaluate the effect that the ACA has or any potential changes to the ACA could have on our business. Additional federal and state legislative and regulatory developments are

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likely, and we expect ongoing initiatives in the United States to increase pressure on drug pricing and reimbursement. Such reforms could have an adverse effect on anticipated revenues from product candidates that we may successfully develop and for which we may obtain regulatory approval and may affect our overall financial condition and ability to develop product candidates.

Changes in laws and regulations affecting the healthcare industry could adversely affect our business.

All aspects of our business, including research and development, manufacturing, marketing, pricing, sales, litigation, and intellectual property rights, are subject to extensive legislation and regulation. Changes in applicable U.S. federal and state laws and agency regulation, as well as foreign laws and regulations, could have a materially negative impact on our business. In the United States and in some other jurisdictions, there have been a number of legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval of our product candidates or any potential future product candidates of ours, restrict or regulate post-approval activities, or affect our ability to profitably sell any product candidates for which we obtain marketing approval. Increased scrutiny by the U.S. Congress of the FDA’s approval process may significantly delay or prevent marketing approval, as well as subject us to more stringent product labeling and post-marketing testing and other requirements. Congress also must reauthorize the FDA’s user fee programs every five years and often makes changes to those programs in addition to policy or procedural changes that may be negotiated between the FDA and industry stakeholders as part of this periodic reauthorization process. Congress most recently reauthorized the user fee programs in September 2022 without any substantive policy changes.

Among policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in health care systems with the stated goals of containing health care costs, improving quality and/or expanding access. In the United States, the pharmaceutical industry has been a focus of these efforts and has been significantly affected by major legislative initiatives. In March 2010, Congress passed the ACA, which substantially changed the way health care is financed by both the government and private insurers, and significantly impacts the U.S. pharmaceutical industry.

There remain judicial and Congressional challenges to certain aspects of the ACA, and as a result certain sections of the ACA have not been fully implemented or effectively repealed. However, following several years of litigation in the federal courts, in June 2021, the U.S. Supreme Court upheld the ACA when it dismissed a legal challenge to the law’s constitutionality. Further legislative and regulatory changes under the ACA remain possible, although the new federal administration under President Biden has signaled that it plans to build on the ACA and expand the number of people who are eligible for health insurance subsidies under it. It is unknown what form any such changes or any law would take, and how or whether it may affect the pharmaceutical industry as a whole or our business in the future. We expect that changes or additions to the ACA, the Medicare and Medicaid programs, and changes stemming from other healthcare reform measures, especially with regard to healthcare access, financing or other legislation in individual states, could have a material adverse effect on the healthcare industry in the United States.

The uncertainty around the future of the ACA, and in particular the impact to reimbursement levels, may lead to uncertainty or delay in the purchasing decisions of our customers, which may in turn negatively impact our product sales. If there are not adequate reimbursement levels, our business and results of operations could be adversely affected.

In addition, other legislative changes have been proposed and adopted since the ACA was enacted. These changes include aggregate reductions to Medicare payments to providers of up to 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013 and was extended by the Consolidated Appropriations Act for 2023, and will remain in effect through 2032 unless additional Congressional action is taken.

In addition, the Drug Supply Chain Security Act enacted in 2013 imposed obligations on manufacturers of pharmaceutical products related to product tracking and tracing, and in February 2022, FDA released proposed regulations to amend the national standards for licensing of wholesale drug distributors by the states; establish new minimum standards for state licensing third-party logistics providers; and create a federal system for licensure for use in the absence of a State program, each of which is mandated by the DSCSA. As another example, in December 2019, the Further Consolidated Appropriations Act for 2020 (P.L. 116-94) was enacted that includes a piece of bipartisan legislation called the CREATES Act. The CREATES Act aims to address the concern articulated by both the FDA and others in the industry that some brand manufacturers have improperly restricted the distribution of their products, including by invoking the existence of a REMS for certain products, to deny generic and biosimilar product developers access to samples of brand products. The CREATES Act establishes a private cause of action that permits a generic or biosimilar product developer to sue the brand manufacturer to compel it to furnish the necessary samples on “commercially reasonable, market-based terms.” Whether and how generic and biosimilar product developments will use this new pathway, as well as the likely outcome of any legal challenges to provisions of the CREATES Act, remain highly uncertain and its potential effects on our future commercial products are unknown. Other legislative and regulatory proposals have been made to expand post-approval requirements and restrict

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sales and promotional activities for pharmaceutical products. We are unsure whether additional legislative changes will be enacted, or whether the current regulations, guidance or interpretations will be changed, or whether such changes will have any impact on our business.