enGene Therapeutics (ENGN) risk factors, FY2025 10-K

Risks Related to Our Business

1. 01acceptance and coverage of our products, if approved, by patients, the medical community and federal healthcare programs and other third-party payors
2. 02If we are unable to develop, obtain regulatory approval for, or if approved, successfully manufacture and commercialize detalimogene, or if we experience delays as a result of any of the above factors or otherwise, our business would be materially harmed
3. 03We have incurred net losses in every year since our inception and anticipate that we will continue to incur net losses in the foreseeable future63% rewritten
4. 04To date, we have not generated any product revenue, have a history of losses and will need to raise additional capital to fund our operations. If we fail to obtain necessary financing, we will not be able to complete the development and commercialization of detalimogene or our other product candidates
5. 05the costs related to any domestic and/or international expansion
6. 06We have concentrated our research and development efforts on our genetic medicine platform, and our future success depends on the successful development and maintenance of our platform
7. 07our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all, or may deviate from the clinical trial
8. 08Interim top-line and preliminary data from our clinical trials that we announce or publish from time to time will change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data28% rewritten
9. 09If we encounter difficulties enrolling patients in clinical trials, our clinical development activities could be delayed or otherwise adversely affected
10. 10the cost to, or lack of adequate compensation for, prospective patients; and
11. 11Although we have conducted the Phase 1 portion of the LEGEND clinical study of detalimogene, we have not as an organization completed later-stage or pivotal clinical trials or submitted a BLA, and we may be unable to do so for detalimogene or any future product candidates in a timely manner or at all
12. 12Any of these events could prevent us from achieving or maintaining market acceptance of any potential product
13. 13the prevalence and severity of any side effects
14. 14Our success will depend on our ability to demonstrate that our genetic medicine platform, detalimogene and any other product candidates we develop and related services can overcome these challenges
15. 15it may take greater human and financial resources than we will possess to identify additional therapeutic opportunities for our product candidates or to develop suitable potential product candidates through internal research programs, thereby limiting our ability to develop, diversify and expand our product portfolio
16. 16Our use of third parties to manufacture, develop and test our therapeutic product candidates for preclinical studies and clinical trials increases the risk that we will not have sufficient quantities of our product candidates or products, or necessary quantities of such materials on time or at an acceptable cost
17. 17the possible misappropriation of proprietary information, including trade secrets and know-how; and the possible termination or non-renewal of the agreement by the third-party at a time that is costly or inconvenient for us
18. 18As part of the manufacturing process of DS, bacterial cells are inoculated to a fermenter and expanded
19. 19The manufacture of DDX and PEG-b-PLE involves multiple complex chemical synthesis and purification steps to produce final products with target specifications and yield. At any stage, any or all of these processes can fail, including the chemical or purification processes54% rewritten
20. 20to manage the cost of goods for detalimogene or other product candidates we develop to levels that will allow for an attractive return on investment if and when detalimogene or those other product candidates are approved and commercializedNew
21. 21We have no experience in developing a manufacturing facility for our biologic products and may never be successful in developing our own manufacturing facility or capability
22. 22Changes in the manufacturing or formulation of detalimogene or any other product candidate we develop may result in additional costs or delay, which could adversely affect our business and results of operations86% rewritten
23. 23the conduct of bridging clinical trials or studies, require the repetition of one or more clinical trials, increase clinical trial costs, delay approval of detalimogene or any other product candidates that we develop and/or jeopardize our ability to commence product sales and generate revenueNew
24. 24The market opportunities for detalimogene and any other product candidates we develop may be limited to a small group of patients who are ineligible for or have failed prior treatments and our estimates of the prevalence of our target patient populations may be inaccurate67% rewritten
25. 25We depend on our executive team and key personnel, and if we lose one or more of our executive officers or key employees or are unable to attract and retain highly skilled employees, such events could harm our businessNew
26. 26We face risks related to epidemics and other outbreaks of communicable diseases which could significantly disrupt our operations, including our clinical trials and preclinical studies, and adversely affect our business and results of operations
27. 27interruption or delays in the operations of the FDA or other regulatory authorities, which may impact review and approval timelines; and interruptions, difficulties or delays arising in our existing operations and company culture as a result of many of our employees working remotely72% rewritten

Regulatory Risks

1. 28We cannot predict whether or when we will obtain regulatory approval to commercialize detalimogene or any other product candidate we may develop in the United States or any other jurisdiction and any such approval may be for a narrower indication than we seek
2. 29the approval policies or regulations of the FDA or other regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval
3. 30We expect the novel nature of detalimogene or any other product candidates that we may develop to create further challenges in obtaining regulatory approval. As a result, our ability to develop product candidates and obtain regulatory approval may be adversely affected
4. 31If we experience delays in obtaining approval or if we fail to obtain approval of detalimogene or any other product candidates that we may develop, the commercial prospects for those product candidates may be harmed and our ability to generate revenues will be materially harmed
5. 32approvals, our target market will be reduced and our ability to realize the full market potential of detalimogene or any other product candidates that we may develop will be harmedNew
6. 33We may seek priority review designation for detalimogene or any other product candidates we develop, but we might not receive such designation, and even if we do, such designation may not lead to a faster regulatory review or approval process
7. 34injunctions or the imposition of civil or criminal penalties
8. 35Changes in regulatory requirements could result in delays or the discontinuation of development of detalimogene or other product candidates or therapies that we may develop, or unexpected costs in obtaining or maintaining regulatory approval, and thereby adversely affect our business and results of operations89% rewritten
9. 36Generally, before a new drug or biologic can be marketed, considerable data demonstrating its quality, safety and efficacy and durability of effect must be obtained, organized into a format specific for each regulatory authority, submitted for review and approved by the regulatory authorityNew
10. 37Our contract manufacturers are subject to significant regulation with respect to the manufacturing of our current and future product candidates. The manufacturing facilities on which we rely may not meet or continue to meet regulatory requirements and/or may have limited capacity
11. 38Ongoing healthcare legislative and regulatory reform measures, including the U.S. federal government’s determination that any of our product candidates, including detalimogene, is an “essential” biologic medicine, may have a material adverse effect on our business and results of operations
12. 39Any product candidates we develop, including detalimogene, may become subject to unfavorable or unprofitable third-party coverage and reimbursement practices, as well as pricing regulations
13. 40Drug marketing, price controls and reimbursement regulations may materially affect our ability to market and receive coverage for our product candidates, if approved, in the European Union, the United Kingdom, Japan and other non-U.S. jurisdictions
14. 41Guidelines and recommendations published by various organizations may impact the use or reimbursement of detalimogene, if approved, as well as other future products
15. 42We are subject to stringent privacy laws, information security laws, regulations, policies and contractual obligations related to data privacy and security and changes in such laws, regulations, policies and contractual obligations could adversely affect our business and results of operations
16. 43Cyber-attacks or other failures in our or our third-party vendors’, contractors’ or consultants’ telecommunications or information technology systems could result in information theft, data corruption and significant disruption of our business operations36% rewritten
17. 44information security vulnerability. Further, we do not maintain separate cyber liability insurance and our general liability insurance and corporate risk program may not cover all potential claims to which we are exposed and may not be adequate to indemnify us for all liabilityNew
18. 45Our employees, independent contractors and contract manufacturers, consultants, commercial partners and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements

Risks Related to International Operations

1. 46Any of these factors could harm our future international expansion and operations and, consequently, our results of operations74% rewritten
2. 47Additional laws and regulations governing international operations may preclude or delay us from developing, manufacturing or selling certain products and product candidates outside the United States, which could limit our growth potential and increase our development costs

Risks Related to Our Intellectual Property

1. 48Issued patents covering our product candidates or genetic medicine platform could be found invalid or unenforceable if challenged in court or before administrative bodies in the United States or other jurisdictions
2. 49Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements
3. 50Changes in either patent laws or interpretation of the patent laws in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our product candidates and genetic medicine platform
4. 51Patent terms may be inadequate to protect our competitive position, product candidates or genetic medicine platform for an adequate amount of time, and we may need to obtain patent term extension and equivalent extensions outside of the United States for our product candidates or genetic medicine platform
5. 52Our rights to develop and commercialize our product candidates and genetic medicine platform may be subject, in part, to the terms and conditions of licenses
6. 53We may be unable to acquire or in-license any relevant third-party intellectual property rights that we identify as necessary or important to our business and results of operations
7. 54If we fail to comply with our obligations under the agreements pursuant to which we license intellectual property rights from third parties or otherwise experience disruptions to our business relationships with our licensors, we could lose the rights to intellectual property that are important to our business56% rewritten
8. 55manufacture and market these potential products, which would have a material adverse effect on our business, financial condition, results of operations and prospectsNew
9. 56the priority of invention of patented technology
10. 57We may not be able to protect our intellectual property and proprietary rights throughout the world22% rewritten
11. 58which could have an adverse effect on our operations or commercial prospects within those countries or ability to pursue action against potential competitorsNew
12. 59We may be involved in legal proceedings in relation to intellectual property rights and to protect or enforce our patents or the patents of our licensors, which could be expensive, time-consuming and unsuccessful
13. 60If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be adversely affected
14. 61Third-party claims of intellectual property infringement, misappropriation or other violation against us, our licensors or our collaborators may prevent or delay the development and commercialization of our novel genetic medicine platform, our product candidates and other technologies
15. 62We may be subject to claims asserting that our employees, consultants or advisors have wrongfully used or disclosed alleged trade secrets of their current or former employers or claims asserting ownership of what we regard as our own intellectual property
16. 63Intellectual property rights do not necessarily address all potential threats to our competitive advantage
17. 64We may not be able to protect and enforce our trademarks and trade names, or build name recognition in our markets of interest thereby harming our competitive position

Risks Related to Acquisitions and Collaborations

1. 65We will need to grow the size of our organization, both organically and through acquisitions, and we may experience difficulties identifying and hiring the right employees and successfully managing this growth
2. 66expanding our facilities
3. 67Acquisitions, collaborations or other strategic partnerships may increase our capital requirements, dilute our shareholders, cause us to incur debt or assume contingent liabilities and subject us to other risks
4. 68potential inability to generate revenue from acquired technology and/or products sufficient to meet our objectives in undertaking the acquisition or even to offset the associated acquisition and maintenance costs
5. 69We may make acquisitions to expand our business and as a result, our results of operations may be adversely affected

Risks Related to Investment in our Securities

1. 70Because we are a Canadian company, shareholder protections differ from shareholder protections in the United States and elsewhere, and we are subject to a variety of additional risks that may negatively impact our operations
2. 71deterioration of political relations with the United States, which could result in uncertainty and/or changes in or to existing trade treaties32% rewritten
3. 72The Articles and certain Canadian legislation contain provisions that may have the effect of delaying, preventing or making undesirable an acquisition of all or a significant portion of our shares or assets or preventing a change in control
4. 73shareholders must give advance notice to nominate directors or to submit proposals for consideration at shareholders’ meetings
5. 74The Articles designate specific courts in Canada and the United States as the exclusive forum for certain litigation that may be initiated by our shareholders without our prior written consent, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us
6. 75Because we are a Canadian company, it may be difficult to serve legal process or enforce judgments against us
7. 76Our ability to use net operating loss carry-forwards and certain other tax attributes are limited30% rewritten
8. 77Holders are urged to consult their tax advisors regarding the availability and tax consequences of a retroactive QEF election under their particular circumstancesNew
9. 78Our Articles include provisions that may discourage takeover attempts, including a classified or “staggered” board
10. 79the absence of cumulative rights in the election of directors

Risks Related to Our Common Shares and Warrants and to Being a Public Company

1. 80Sales of Common Shares, or the perception of such sales, by us or the Selling Holders in the public market or otherwise could cause the market price for our Common Shares to decline and certain Selling Holders still may receive a significant rate of return69% rewritten
2. 81additional 2,294,117 Common Shares pursuant to a greenshoe option granted to the underwriters in the offering, for an aggregate public offering price of approximately $149.5 million of securities, prior to deducting underwriting discounts and commissionsNew
3. 82Certain existing securityholders acquired their securities in our Company at prices that may be below the current trading price of such securities, and may experience a positive rate of return based on such current trading price. Future investors in our Company may not experience a similar rate of return
4. 83The exercise price for our Warrants is $11.50 per Common Share. The Warrants will expire on October 31, 2028, the date that is five years after the completion of the Reverse Recapitalization (as defined herein)
5. 84We will continue to incur increased costs as a result of operating as a public company, and the requirements for public companies may strain resources and divert management’s attention22% rewritten
6. 85We may be unable to satisfy Nasdaq’s continued listing requirements in the future, which could limit investors’ ability to effect transactions in our securities and subject it to additional trading restrictions
7. 86We will continue to incur increased costs as a result of operating as a public company, and our management will devote substantial time to new compliance initiatives
8. 87A market for our securities may not develop or be sustained, which would adversely affect the liquidity and price of our securities
9. 88The trading price of our Common Shares could be highly volatile, and purchasers of our Common Shares could incur substantial losses
10. 89We could be a target of securities class action and derivative lawsuits, which could result in substantial costs
11. 90If securities or industry analysts do not publish research about us at all or publish inaccurate or unfavorable research about us or our business, the market price and/or the trading volume of our Common Shares could decline