Metagenomi Therapeutics (MGX) risk factors, FY2025 10-K

Risks Related to Financial Position and Need for Capital

1. 01We have incurred significant losses since inception. We expect to incur losses for the foreseeable future and may never achieve or maintain profitability
2. 02incur additional legal, audit, accounting, compliance, insurance, investor relations and other expenses related to operating as a public company that we did not incur as a private company35% rewritten
3. 03We have never generated revenue from product sales and may never become profitable
4. 04attract, hire and retain qualified personnel
5. 05Our operations will require substantial additional funding. If we are unable to raise additional capital when needed on acceptable terms, or at all, we may be forced to delay, reduce, or terminate certain of our research and product development programs, future commercialization efforts or other operations75% rewritten
6. 06pandemics, epidemics or outbreaks of a contagious illness, economic uncertainty, tariffs and other trade disputes and geopolitical tensions, which may exacerbate the magnitude of the factors discussed above
7. 07Our short operating history may make it difficult for you to evaluate the success of our business to date and to assess our future viability
8. 08Our future ability to utilize our net operating loss carryforwards and certain other tax attributes may be limited
9. 09Changes in tax laws or in their implementation or interpretation may adversely affect our business and financial conditionNew

Risks Related to Business, Technology, and Industry

1. 10establishment and maintenance of healthcare coverage and adequate reimbursement by payors
2. 11We are subject to additional development challenges and risks due to the novel nature of our genome editing technology
3. 12If any of the product candidates we may develop or the delivery modes we rely on cause undesirable side effects, it could delay or prevent their development or potential regulatory approval, limit the commercial potential or result in significant negative consequences following any potential regulatory approval
4. 13Any of these events could prevent us from achieving or maintaining market acceptance of our genome editing technology and any product candidates we may identify and develop and could have a material adverse effect on our business, financial condition, results of operations and prospects
5. 14We may also consider additional delivery modes, which may carry additional known and unknown risks34% rewritten
6. 15patient referral practices of physicians
7. 16potential burden of complying with a variety of foreign laws, medical standards and regulatory requirements, including the regulation of pharmaceutical and biotechnology products and treatment and of genome editing technologies28% rewritten
8. 17Adverse public perception of genome editing and cellular therapy products may negatively impact demand for, or regulatory approval of, any product candidates we may develop
9. 18The commercial success of any of the product candidates we may develop will depend upon the degree of market acceptance by physicians, patients, third-party payors and others in the medical community
10. 19sufficient third-party payor coverage and reimbursement
11. 20We 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
12. 21unforeseen costs and expenses associated with creating an independent sales and marketing organization
13. 22Due to the novel nature of our technology and the potential for any product candidates we may develop to offer therapeutic benefit in a single administration or limited number of administrations, we face uncertainty related to pricing and reimbursement for such product candidates
14. 23neither experimental nor investigational
15. 24If we are not able to establish collaborations on a timely basis, on commercially reasonable terms, or at all, we may have to alter, reduce or delay our development and commercialization plans, or increase our expenditures to fund development or commercialization activities at our own expense
16. 25Unfavorable global economic conditions could adversely affect our business, financial condition or results of operations
17. 26We face risks related to health epidemics, pandemics and other widespread outbreaks of contagious disease, which could significantly disrupt our operations, impact our financial results or otherwise adversely impact our business
18. 27business disruptions caused by potential workplace, laboratory and office closures and an increased reliance on employees working from home, disruptions to or delays in ongoing laboratory experiments and operations, staffing shortages, travel limitations, and cybersecurity and data accessibility or security issues45% rewritten
19. 28Our operations are vulnerable to interruption by disasters, terrorist activity, pandemics and other events beyond our control, which could harm our business
20. 29We use artificial intelligence in our business, and challenges with properly managing its use, as well as uncertainty regarding the legal landscape surrounding the use of AI could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations22% rewritten

Risks Related to Regulatory, Legal, and Clinical Trials

1. 30Healthcare and other reform legislation may increase the difficulty and cost for us and any collaborators we may have to obtain regulatory approval of and commercialize any product candidates we may develop and affect the prices we, or they, may obtain51% rewritten
2. 31The effect of these healthcare reform initiatives on our business and the pharmaceutical industry in general is not yet known, but could be substantial and materially adverse to our ability to successfully commercialize our product candidates at profitable price pointsNew
3. 32Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors, which may adversely affect our future profitability
4. 33Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses. Many companies that have believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain regulatory approval of their product candidates
5. 34changes in regulatory requirements and guidance that require amending or submitting new clinical protocols
6. 35experience damage to our reputation
7. 36Even if we complete the necessary clinical trials, we cannot predict when, or if, we will obtain regulatory approval to commercialize a product candidate we may develop in the United States or any other jurisdiction, and any such approval may be for a more narrow indication than we seek
8. 37If we or any contract manufacturers and suppliers we engage fail to comply with environmental, health, and safety laws and regulations, we could become subject to fines or penalties or incur costs that could have a material adverse effect on the success of our business
9. 38Our employees, principal investigators, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading
10. 39Product liability lawsuits against us could cause us to incur substantial liabilities and could limit commercialization of any product candidates that we may develop
11. 40the inability to commercialize any product candidates that we may develop
12. 41Laws and regulations governing any international operations we may have in the future may preclude us from developing, manufacturing and selling certain product candidates we may identify outside of the United States and require us to develop and implement costly compliance programs
13. 42We are subject to stringent and often unsettled laws, rules, regulations, policies, standards and contractual obligations related to data privacy and security and changes in such laws, rules, regulations, policies, standards and contractual obligations could adversely affect our business
14. 43There are numerous U.S. federal and state laws, rules and regulations related to the collection, use, disclosure and security of personal information

Risks Related to Third Party Relationships

1. 44If conflicts arise between us and our collaborators or strategic partners, these parties may act in a manner adverse to us and could limit our ability to implement our strategies
2. 45We have entered into collaborations, and may enter into additional collaborations, with third parties for the research, development, manufacture and commercialization of programs or product candidates. If these collaborations are not successful, our business could be adversely affected63% rewritten
3. 46collaborations may be terminated for the convenience of the collaborator, and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates
4. 47Our collaborators and strategic partners may control aspects of our clinical trials, which could result in delays and other obstacles in the commercialization of our proposed products and materially harm our results of operations32% rewritten
5. 48Our collaborators or strategic partners may decide to adopt alternative technologies or may be unable to develop commercially viable products with our technology, which would negatively impact our revenues and our strategy to develop these products
6. 49We expect to rely on third parties to conduct our clinical trials and some aspects of our research, as well as some aspects of our delivery methods, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials, research or testing
7. 50form relationships with other entities, some of which may be our competitors
8. 51the possible termination or nonrenewal of the agreement by the third party at a time that is costly or inconvenient for us
9. 52Our current and anticipated future dependence upon others for the manufacture of materials and any future product candidates or products we may develop may adversely affect our future profit margins and our ability to commercialize any products that receive regulatory approval on a timely and competitive basis
10. 53Some state laws also require pharmaceutical companies to comply with specific compliance standards, restrict financial interactions between pharmaceutical companies and healthcare providers or require pharmaceutical companies to report information related to payments to healthcare providers or marketing expenditures

Risks Related to Personnel, Operations, and Growth

1. 54We may not realize the expected operational or financial benefits from our organizational changes, which could also have unintended consequences and adversely impact our financial position, results of operations and cash flowsNew
2. 55On November 11, 2025, we announced a new Chief Executive Officer and a strategic restructuring that included a reduction in our organizational headcount of 25%. We recognized substantially all of the charges related to workforce reduction in the quarter ended December 31, 2025New
3. 56Our future success depends on our ability to retain our Chief Executive Officer and other key executives and to attract, retain, and motivate qualified personnel
4. 57We expect to expand our research, development, delivery, manufacturing, commercialization, regulatory, and future sales and marketing capabilities over time, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations40% rewritten

Risks Related to Our Intellectual Property

1. 58We, or any future partners, collaborators, or licensees, may fail to identify patentable aspects of inventions made in the course of development and commercialization activities before it is too late to obtain patent protection on them. Therefore, we may miss potential opportunities to strengthen our patent position41% rewritten
2. 59countries other than the U.S. may, under certain circumstances, force us to grant a license under our patents to a competitor, thus allowing the competitor to compete with us in that jurisdiction or forcing us to lower the price of our drug in that jurisdiction79% rewritten
3. 60It is difficult and costly to protect our intellectual property and our proprietary technologies, and we may not be able to ensure their protection
4. 61we may not develop additional proprietary technologies or genome editing systems that are separately patentable
5. 62Patent terms may be inadequate to protect our competitive position on our products for an adequate amount of time24% rewritten
6. 63Changes in the interpretation of patent law in the United States and other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products71% rewritten
7. 64Subsequent rulings in cases or guidance or procedures issued by the USPTO relating to patent eligibility may have a negative impact on our business
8. 65We may not be able to seek or obtain patent protection throughout the world or enforce such patent protection once obtained38% rewritten
9. 66In order to protect our competitive position around our future product candidates, we may become involved in lawsuits to enforce our patents or other intellectual property, which could be expensive, time consuming and unsuccessful and which may result in our patents being found invalid or unenforceable
10. 67If we are sued for infringing intellectual property rights of third parties, such litigation could be costly and time consuming and could prevent or delay us from developing or commercializing our genome editing systems53% rewritten
11. 68Others may challenge inventorship or claim an ownership interest in our intellectual property which could expose it to litigation and have a significant adverse effect on its prospects
12. 69We may be subject to claims by third parties asserting that our employees or we have misappropriated their intellectual property or claiming ownership of what we regard as our own intellectual property
13. 70If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed31% rewritten
14. 71A third party may hold intellectual property, including patent rights that are important or necessary to the development of our genome editing systems. It may be necessary for us to use the patented or proprietary technology of one or more third parties to commercialize our current and future product candidates
15. 72If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize the affected genome editing systems
16. 73If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our trademarks of interest and our business may be adversely affected
17. 74Intellectual property rights do not necessarily address all potential threats to our business

Risks Related to our Common Stock, and Operating as a Public Company

1. 75The market price of our common stock has been, and may continue to be, volatile, which could result in substantial losses for investors
2. 76the other factors described in this “Risk Factors” section
3. 77We have incurred, and continue to incur, increased costs as a result of operating as a public company, and our management is required to devote substantial time to compliance initiatives and corporate governance practices
4. 78We do not know whether a market will be sustained for our common stock or what the market price of our common stock will be, and, as a result, it may be difficult for you to sell your shares of our common stock
5. 79If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our stock, the price of our stock could decline
6. 80Future sales of our common stock in the public market could cause our stock price to fall30% rewritten
7. 81We are an “emerging growth company” and a “smaller reporting company,” and the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies may make our common stock less attractive to investors
8. 82Insiders have substantial influence over us, which could limit your ability to affect the outcome of key transactions, including a change of control
9. 83We do not expect to pay any dividends for the foreseeable future. Investors may never obtain a return on their investment
10. 84If we fail to establish and maintain proper and effective internal control over financial reporting, our operating results and our ability to operate our business could be harmed28% rewritten
11. 85Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud
12. 86Our second amended and restated bylaws designate specific courts as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit stockholders’ ability to obtain a favorable judicial forum for disputes with us
13. 87These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management. These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of our common stock69% rewritten
14. 88Adverse developments affecting the financial services industry could adversely affect our current and projected business operations and our financial condition and results of operations