Nektar Therapeutics (NKTR) risk factors, FY2024 10-K

Risks Related to our Business

1. 01We are highly dependent on the success of drug candidates, particularly rezpegaldesleukin (previously referred to as NKTR-358). If these drug candidates fail in clinical development our business will be significantly harmed
2. 02Delays in clinical studies are common and have many causes, and any significant delay in clinical studies being conducted by us or our partners could result in delay in regulatory approvals and jeopardize the ability to proceed to commercialization
3. 03delays associated with third parties, such as a past collaboration partner, failing to provide us with all the necessary documents, data and materials necessary to conduct clinical trials
4. 04The outcomes from the clinical trials of drug candidates from others, and the discovery and development of new potential therapies in immunology and oncology, could have a material and adverse impact on the value of the drug candidates in our research and development pipeline
5. 05The risk of clinical failure for any drug candidate remains high prior to regulatory approval and there can be no assurance that our drug candidates will obtain regulatory approval for any particular indications
6. 06Significant competition could render our partnered and proprietary drugs and drug candidates obsolete or noncompetitive, which would negatively impact our business, results of operations and financial condition
7. 07Preliminary and interim data from our clinical studies that we announce or publish from time to time are subject to audit and verification procedures that could result in material changes in the final data and may change as more patient data become available

Risks Related to our Financial Condition and Capital Requirement

1. 08Additional cost-savings measures may be necessary following implementation of our strategic reorganization plan and cost restructuring plans
2. 09Our results of operations and financial condition depend significantly on the ability of our collaboration partners to successfully develop and market drugs and they may fail to do so
3. 10marketing and selling the drugs when and if they are approved
4. 11partners may respond to natural disasters or health epidemics by ceasing all or some of their development responsibilities (including the responsibility to clinical develop our drug candidates)
5. 12disputes concerning patents, proprietary rights, or license and collaboration agreements that could negatively impact our receipt of milestone payments or royalties or require us to make significant payments arising from licenses, settlements, adverse judgments or ongoing royalties
6. 13The commercial potential of a drug candidate in development is difficult to predict. If the market size for a new drug is significantly smaller than we anticipate, it could significantly and negatively impact our revenue, results of operations and financial condition
7. 14If government and private insurance programs do not provide payment or reimbursement for our partnered drug or proprietary drugs, those drugs will not be widely accepted, which would have a negative impact on our business, results of operations and financial condition
8. 15In addition, net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs or private payers 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
9. 16If we are unable to establish and maintain collaboration partnerships on attractive commercial terms, our business, results of operations and financial condition could suffer
10. 17Our revenue has historically been exclusively derived from our collaboration agreements, which can result in significant fluctuation in our revenue from period to period, and our past revenue is therefore not necessarily indicative of our future revenue
11. 18We expect to continue to incur substantial losses and negative cash flow from operations and may not achieve or sustain profitability in the future

Risks Related to Supply and Manufacturing

1. 19We purchase some of the starting material for biologics and biologic candidates from a single source or a limited number of suppliers, and the partial or complete loss of one of these suppliers could cause production delays, clinical trial delays, potential loss of revenue and contract liability to third parties
2. 20The manufacturing operations of our contract manufacturers are subject to laws and other governmental regulatory requirements, which, if not met, would have a material adverse effect on our business, results of operations and financial condition

Risks Related to Business Operations

1. 21We depend on third parties to conduct the preclinical studies and clinical trials for our drug candidates and any failure of those parties to fulfill their obligations according to protocol standards could harm our development plans and adversely affect our business
2. 22Our future depends on the proper management of our current and future business operations and their associated expenses
3. 23Because competition for highly qualified technical personnel is intense, we may not be able to attract and retain the personnel we need to support our operations and growth
4. 24We are dependent on our management team and key technical personnel, and the loss of any key manager or employee may impair our ability to develop our products effectively and may harm our business, operating results and financial condition
5. 25Inflation has increased our operating costs and could negatively impact our operations
6. 26Our business could be adversely affected by the effects of future health epidemics

Risks Related to Intellectual Property, Litigation and Regulatory Concerns

1. 27If we or our partners do not obtain regulatory approval for our drug candidates on a timely basis, or at all, or if the terms of any approval impose significant restrictions or limitations on use, our business, results of operations and financial condition will be negatively affected
2. 28FDA procedures and does not ensure ultimate marketing approval by the FDA. In addition, the FDA may later decide that the product candidates no longer meet the designation conditions
3. 29injunctions or the imposition of civil or criminal penalties
4. 30We are a party to numerous collaboration agreements and other significant agreements which contain complex commercial terms that could result in disputes, litigation or indemnification liability that could adversely affect our business, results of operations and financial condition
5. 31indemnity obligations for intellectual property infringement, product liability and certain other claims
6. 32We may not be able to obtain intellectual property licenses related to the development of our drug candidates on a commercially reasonable basis, if at all
7. 33If any of our pending patent applications do not issue, or are deemed invalid following issuance, we may lose valuable intellectual property protection
8. 34We rely on trade secret protection and other unpatented proprietary rights for important proprietary technologies, and any loss of such rights could harm our business, results of operations and financial condition
9. 35If product liability lawsuits are brought against us, we may incur substantial liabilities
10. 36If we or current or future collaborators or service providers fail to comply with healthcare laws and regulations, we or they could be subject to enforcement actions and civil or criminal penalties
11. 37Healthcare legislative or regulatory reform measures may have a negative impact on our business and results of operations
12. 38the availability of capital
13. 39Disruptions to the normal functioning of the FDA and other government agencies could hinder their ability to perform and carry out important roles and activities on which the operation of our business relies, which could negatively impact our business
14. 40We are involved in legal proceedings and may incur substantial litigation costs and liabilities that will adversely affect our business, financial condition and results of operations
15. 41From time to time, we may also be involved in legal proceedings other than those related to intellectual property, including securities actions or derivative actions or other complaints
16. 42The use of new and evolving technologies, such as AI, may present risks and challenges that can impact our business, including by posing security and other risks to our confidential information and proprietary information. As a result, we may be exposed to reputational harm and liability
17. 43Our operations may involve hazardous materials and are subject to environmental, health, and safety laws and regulations. Compliance with these laws and regulations is costly, and we may incur substantial liability arising from our activities involving the use of hazardous materials

Risks Related to Investment and Securities

1. 44The price of our common stock has, and may continue to fluctuate significantly, which could result in substantial losses for investors and securities class action and shareholder derivative litigation
2. 45general economic, industry and market conditions, including the impacts of rising inflation and interest rates and global geopolitical tensions
3. 46We have implemented certain anti-takeover measures, which make it more difficult to acquire us, even though such acquisitions may be beneficial to our stockholders
4. 47limitations on who may call a special meeting of stockholders
5. 48Changes in tax law could adversely affect our business and financial condition
6. 49Global economic and political conditions may negatively affect us and may magnify certain risks that affect our business
7. 50Our business could be negatively impacted by corporate citizenship and sustainability matters
8. 51If natural disasters or other catastrophic events strike, our business may be harmed