Nuvation Bio (NUVB) risk factors, FY2024 10-K

Risks Related to Our Financial Position and Need for Additional Capital

1. 01Except in China where taletrectinib is being commercialized by our partner Innovent, our product candidates are all in development. As a result, we are unable to predict if or when we will successfully develop or commercialize our product candidates, and to generate revenue or profits
2. 02We will need substantial funding to pursue our business objectives. If we are unable to raise capital when needed or on favorable terms, or receive significant revenues from the sales of our product, we could be forced to delay, reduce or terminate our product development, other operations or commercialization efforts
3. 03the extent to which we acquire or in-license other product candidates and technologies and associated intellectual property, and payments required under such acquisitions or in-licenses
4. 04Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish proprietary rights
5. 05that adversely affect your rights as a stockholder. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends
6. 06Changes in tax laws or regulations that are applied adversely to us or our customers may have a material adverse effect on our business, cash flow, financial condition or results of operations
7. 07Our ability to use our net operating loss carryforwards and certain other tax attributes to offset taxable income or taxes may be limited

Risks Related to our Indebtedness

1. 08Our level of indebtedness and debt service obligations could adversely affect our financial condition and may make it more difficult for us to fund our operations
2. 09the outstanding debt obligations at maturity. If we draw down any of the tranches under the Loan Agreement, our indebtedness will increase, which would further increase our risk of being unable to pay off or refinance our outstanding debt obligations at maturity
3. 10The terms of the Loan Agreement and the RIF Agreement place restrictions on our operating and financial flexibility
4. 11We may not have cash available in an amount sufficient to enable us to make interest, principal or other payments on our indebtedness when due
5. 12In the event of default, the lenders could accelerate all of the amounts due under the Loan Agreement or the RIF Agreement, as applicable. Sagard could also exercise its rights to take possession and dispose of certain of our assets that are collateral
6. 13The RIF Agreement place certain restrictions on our operational flexibility

Risks Related to the Development of our Product Candidates

1. 14If we do not obtain regulatory approval for and successfully commercialize one or more of our product candidates or we experience significant delays in doing so, we may never generate any revenue or become profitable
2. 15obtaining licenses to any third-party intellectual property we deem necessary or desirable
3. 16We are currently conducting, and may in the future conduct, clinical trials for current or future product candidates outside the United States, and the FDA and comparable foreign regulatory authorities may not accept data from such clinical trials
4. 17Our DDC platform-based product candidates are based on a novel technology, which makes it difficult to predict the time and cost of product candidate development
5. 18We may in the future develop product candidates in combination with other therapies and that may expose us to additional risks
6. 19Clinical trials are very expensive, time-consuming and difficult to design and implement, and involve uncertain outcomes. Furthermore, results of earlier preclinical studies and clinical trials may not be predictive of results of future preclinical studies or clinical trials
7. 20Interim, “topline,” and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data
8. 21We may encounter substantial delays in our preclinical studies or clinical trials or we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities
9. 22changes in regulatory requirements and guidance that require amending or submitting new clinical protocols
10. 23Our drug development costs will also increase if we experience delays in testing or obtaining marketing approvals. We do not know whether any of our preclinical studies or clinical trials will begin as planned, need to be restructured or be completed on schedule, if at all
11. 24If we encounter continued or new difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected
12. 25the risk that patients enrolled in clinical trials will drop out of the trials before completion
13. 26Delays in patient enrollment may result in increased costs or may affect the timing or outcome of our current or planned clinical trials, which could prevent completion of these trials and adversely affect our ability to advance the development of our product candidates
14. 27we may not realize the full commercial potential of these product candidates that receive marketing approval if, among other reasons, we are unable to appropriately identify patients or types of tumors with the specific genetic alterations targeted by these product candidates
15. 28We 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
16. 29If any of our product candidates receives marketing approval and we, or others, later discover that the drug is less effective than previously believed or causes undesirable side effects that were not previously identified, our ability to market the drug could be compromised
17. 30We may become exposed to costly and damaging liability claims, either when testing our product candidates in the clinic or at the commercial stage, and our product liability insurance may not cover all damages from such claims
18. 31Even if we receive Fast Track designation or granting of other FDA expedited programs, or other comparable foreign expedited programs, for any of our product candidates, there is no guarantee that such product candidates will experience a faster regulatory review or obtain regulatory approval
19. 32Even if we receive Orphan Drug designation for any of our product candidates, we may be unable to maintain the benefits associated with such designation, including the potential for market exclusivity

Risks Related to Commercialization of Our Product Candidates

1. 33We have never commercialized a product candidate on our own and we may lack the necessary expertise, personnel and resources to successfully commercialize any of our products that receive regulatory approval on our own
2. 34We face substantial competition, which may result in others discovering, developing or commercializing products before or more successfully than we do
3. 35Even if any of our product candidates receive marketing approval, they may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success
4. 36our ability to obtain sufficient third-party coverage and adequate reimbursement
5. 37the level of taxes that we are required to pay
6. 38Even if we obtain regulatory approval for our product candidates, they will remain subject to ongoing regulatory oversight
7. 39If any of these events occurs, our ability to sell such product may be impaired, and we may incur substantial additional expense to comply with regulatory requirements, which could harm our business, financial condition, results of operations and prospects
8. 40unforeseen costs and expenses associated with creating an independent sales and marketing organization

Risks Related to Our Dependence on Third Parties

1. 41We do not have any laboratory facilities and have relied on CROs to perform most of the medicinal chemistry work associated with our drug discovery activities
2. 42We do not have our own manufacturing capabilities and will rely on third parties to produce clinical and commercial supplies of taletrectinib, safusidenib, NUV-1511, NUV-868 and our other current and future product candidates
3. 43failure to deliver our products under specified storage conditions and in a timely manner
4. 44Potential disputes between us and Daiichi Sankyo, including disagreements regarding the Taletrectinib In-License Agreement and the Safusidenib In-License Agreement
5. 45If we are not able to establish and maintain collaborations, we may have to alter some of our future development and commercialization plans
6. 46and document. In addition, there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in a reduced number of potential future collaborators

Risks Related to Regulatory Compliance

1. 47Enacted and future legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and affect the prices we may charge for such product candidates
2. 48European, Chinese and other foreign law equivalents of each of the laws, including reporting requirements detailing interactions with and payments to healthcare providers
3. 49of 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
4. 50Our processing activities subject us to numerous data privacy and security obligations, such as various laws, regulations, guidance, industry standards, external and internal privacy and security policies, contractual requirements and other obligations relating to data privacy and security
5. 51United Kingdom’s GDPR, or UK GDPR, Australia’s Privacy Act, and China’s Personal Information Protection Law, or PIPL, impose strict requirements for processing personal data

Risks Related to Our Intellectual Property

1. 52If we are unable to obtain, maintain, protect and enforce sufficient patent and other intellectual property rights for our product candidates and technology, or if the scope of patent and other intellectual property rights obtained is not sufficiently broad, we may not be able to compete effectively in our market
2. 53The patent protection we obtain for our product candidates and technology may be challenged or not sufficient to provide us with any competitive advantage
3. 54Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed
4. 55We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time-consuming and unsuccessful, and issued patents covering our technology and product candidates could be found invalid or unenforceable if challenged
5. 56We may not be able to protect our intellectual property rights throughout the world
6. 57We may not identify relevant third-party patents or pending patent applications or may incorrectly interpret the relevance, scope or expiration of a third-party patent which might adversely affect our ability to develop and market our product candidates
7. 58If we are unable to obtain licenses from third parties on commercially reasonable terms or fail to comply with our obligations under such agreements, our business could be harmed
8. 59Patent terms may be inadequate to protect our competitive position on our product candidates for an adequate amount of time
9. 60Changes in patent law could diminish the value of patents in general, thereby impairing our ability to protect our product candidates
10. 61Obtaining and maintaining 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 if we fail to comply with these requirements
11. 62Third parties may initiate legal proceedings alleging that we are infringing, misappropriating or otherwise violating their intellectual property rights, the outcome of which would be uncertain and could negatively impact the success of our business
12. 63We may be subject to claims by third parties asserting that we or our employees have infringed upon, misappropriated or otherwise violated their intellectual property rights, or claiming ownership of what we regard as our own intellectual property
13. 64Intellectual property litigation could cause us to spend substantial resources and distract our personnel from their normal responsibilities
14. 65If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed
15. 66We 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
16. 67Intellectual property rights do not necessarily address all potential threats
17. 68the patents or pending patent applications of others may harm our business; and

Risks Related to Our Business Operations, Employee Matters and Managing Growth

1. 69AnHeart could be difficult to integrate, divert the attention of management, and disrupt our business, and the anticipated synergies and other benefits of the AnHeart acquisition may not be realized in the amounts anticipated, or may not be realized within the anticipated timeframe, or at all
2. 70evaluating and forecasting the financial impact of the Acquisition transaction, including accounting impacts
3. 71potential unknown liabilities, adverse consequences and unforeseen increased expenses associated with the integration
4. 72Our future success depends on our ability to retain Dr. Hung and our other key employees, consultants and advisors and to attract, retain and motivate qualified personnel
5. 73We expect to expand our development, regulatory, sales, marketing and distribution capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations
6. 74Our employees, independent contractors, consultants, commercial collaborators, principal investigators, CROs and vendors may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements
7. 75times of war and other major conflicts, we and the third parties with whom we work may be vulnerable to a heightened risk of these attacks, including retaliatory cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell and distribute our services
8. 76providing credit monitoring. Such disclosures and compliance with such requirements are costly, and the disclosure or the failure to comply with such requirements could lead to adverse consequences

Risks Related to Doing Business in China and Our International Operations

1. 77Changes in the political and economic policies or in relations between China and the United States may affect our business, financial condition, and results of operations
2. 78Changes in U.S. and Chinese regulations may impact our business, our operating results, and our ability to raise capital
3. 79As a company with operations and business relationships outside of the United States, our business is subject to economic, political, regulatory and other risks associated with international operations
4. 80If we fail to comply with Chinese 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
5. 81Development in the Chinese legal system could materially and adversely affect us
6. 82Regulatory requirements on currency exchange may limit our ability to receive and use effectively financing in foreign currencies
7. 83We and our shareholders face uncertainties in China with respect to indirect transfers of equity interests in China resident enterprises
8. 84Any failure to comply with Chinese regulations regarding the registration requirements for our employee equity incentive plans may subject us to fines and other legal or administrative sanctions, which could adversely affect our business, financial condition and results of operations

Risks Related to Ownership of Our Securities

1. 85The market price of our securities may be volatile and fluctuate substantially, which could result in substantial losses for our investors and may subject us to securities litigation suits
2. 86other events or factors, many of which are beyond our control
3. 87The dual-class structure of our common stock has the effect of concentrating voting power with our Chief Executive Officer, which limits other stockholders’ ability to influence the outcome of important transactions, including a change in control
4. 88We cannot predict the impact our dual-class structure may have on the market price of our Class A common stock
5. 89There can be no assurance that we will be able to comply with the continued listing standards of the NYSE
6. 90Future sales, or the perception of future sales, by us or our stockholders in the public market could cause the market price for our securities to decline
7. 91Because we do not anticipate paying any cash dividends on our Class A common stock in the foreseeable future, capital appreciation, if any, will be your sole source of gains and you may never receive a return on your investment
8. 92There is no guarantee that our warrants will be in the money at the time they become exercisable, and they may expire worthless
9. 93We may issue additional securities without your approval, which would dilute your ownership interests and may depress the market price of our securities
10. 94Anti-takeover provisions in our amended and restated certificate of incorporation and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders, more difficult, and may prevent attempts by our stockholders to replace or remove our current management
11. 95the ability of the board of directors to issue preferred stock without stockholder approval, which could be used to institute a “poison pill” that would work to dilute the stock ownership of a potential hostile acquirer, effectively preventing acquisitions that have not been approved by the board of directors
12. 96any action asserting a claim against us that is governed by the internal-affairs doctrine or otherwise related to our internal affairs
13. 97We are eligible to report as a “smaller reporting company,” and as a result of the reduced reporting requirements applicable to “smaller reporting companies,” our securities may be less attractive to investors
14. 98If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired
15. 99on Form 10-K for that year. This has required us to incur substantial additional professional fees and internal costs to expand our accounting and finance functions and to expend significant management efforts
16. 100We will incur costs and demands upon our management as a result of complying with the laws and regulations affecting public companies in the U.S., which may harm our business
17. 101If securities or industry analysts cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our securities adversely, the price and trading volume of our securities could decline