PepGen (PEPG) risk factors, FY2025 10-K

Risks Related to Our Financial Position and Need for Additional Capital

1. 01We are substantially dependent on the success of our lead product candidate, PGN-EDODM1. If we are unable to complete development of, obtain approval for and commercialize PGN-EDODM1 in a timely manner or at all, our business will be harmedNew
2. 02our ability to maintain, protect, enforce and defend our intellectual property portfolio in the United States and internationallyNew
3. 03We have incurred significant losses since our inception, have no products approved for sale and we expect to incur losses for the foreseeable future49% rewritten
4. 04add operational, legal, compliance, financial and management information systems and personnel to support our research, product development and future commercialization efforts, as well as to support our operations as a public company22% rewritten
5. 05We have never generated revenue from product sales and may never achieve or maintain profitability70% rewritten
6. 06satisfying any post-marketing requirements
7. 07We will need to raise substantial additional funding. If we are unable to raise substantial additional funding when needed, we could be forced to delay, scale back or discontinue our product development programs or future commercialization efforts80% rewritten
8. 08the costs of operating as a public company
9. 09Our limited operating history may make it difficult for you to evaluate the success of our business to date and to assess our future viability76% rewritten
10. 10Consequently, any predictions you make 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 productsNew

Risks Related to Discovery, Development, Preclinical and Clinical Testing

1. 11establishment and maintenance of healthcare coverage and adequate reimbursement by payors
2. 12If we experience delays or difficulties in the enrollment of patients in clinical trials, our ability to complete clinical trials may be adversely impacted21% rewritten
3. 13other factors outside of our control, such as the potential effects of any epidemics, pandemics or health crisis21% rewritten
4. 14Our approach to the discovery and development of product candidates based on our EDO platform is unproven, and we may not be successful in our efforts to identify, discover or develop potential product candidates37% rewritten
5. 15If we are unable to identify and discover suitable product candidates for clinical development, this would adversely impact our business strategy and our financial position and share price and could potentially cause us to cease operations44% rewritten
6. 16Furthermore, product candidates are subject to continued preclinical safety studies, which may be conducted concurrently with our clinical testing. The outcomes of these safety studies may delay the launch of, or enrollment in clinical trials and could impact our ability to continue to conduct our clinical trials
7. 17lack of diminished revenue potential of the program(s) due to competition
8. 18In addition, disruptions caused by the effects of any epidemics or pandemics may increase the likelihood that we encounter such difficulties or delays in initiating, enrolling, conducting or completing our planned and ongoing clinical trials
9. 19experience damage to our reputation
10. 20The outcome of preclinical studies and earlier-stage clinical trials may not be predictive of future results or the success of later preclinical studies and clinical trials66% rewritten
11. 21Interim, initial, “topline”, and preliminary data from our preclinical studies or 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 data78% rewritten
12. 22approval, limit the commercial potential of such candidate or result in significant negative consequences following any potential marketing approvalNew
13. 23We may expend our limited resources to pursue a particular program, product candidate or indication and fail to capitalize on programs, product candidates or indications that may be more profitable or for which there is a greater likelihood of success26% rewritten
14. 24The increasing use of social media platforms presents new risks and challenges
15. 25Clinical trial and product liability lawsuits against us could divert our resources, could cause us to incur substantial liabilities and could limit commercialization of our product candidates
16. 26the inability to commercialize our product candidates
17. 27We conduct certain clinical trials for our product candidates outside of the U.S. However, the FDA and comparable foreign regulatory authorities may not accept data from such trials, in which case our development plans will be delayed, which could materially harm our business

Risks Related to Our Dependence on Third Parties

1. 28form relationships with other entities, some of which may be our competitors
2. 29We currently depend on a small number of third-party suppliers to supply the product candidates that we are evaluating in our research and development programs. The loss of these or future third-party suppliers, or their inability to provide us with sufficient supply, could harm our business28% rewritten
3. 30in the event of approval to market and commercialize any product, an inability to meet commercial demands for the product
4. 31We do not currently have arrangements in place for redundant supply or a second source for all required raw materials. If our existing or future third-party manufacturers cannot perform as agreed, we may be required to replace such manufacturers and we may be unable to replace them on a timely basis or at all56% rewritten
5. 32We are dependent on single-source suppliers for some of the components and materials used in our product candidates
6. 33We may enter into collaborations with third parties for the research, development and commercialization of certain of our product candidates. If any such collaborations are not successful, we may not be able to capitalize on the market potential of those product candidates
7. 34collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner or at all
8. 35If conflicts arise between us and our potential collaborators, these parties may act in a manner adverse to us and could limit our ability to implement our strategies
9. 36If we are not able to establish collaborations on commercially reasonable terms, we may have to alter our development and commercialization plans
10. 37Collaborations are complex and time-consuming to negotiate and 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
11. 38We are dependent on third-party vendors to provide certain licenses, products and services and our business and operations, including clinical trials, could be disrupted by any problems with our significant third-party vendors

Risks Related to Regulatory Approval and Other Regulatory and Legal Compliance Matters

1. 39As an organization, we have only completed or initiated a small number of clinical trials and may be unable to do so for any of our other product candidates nor carry out or complete further studies for our lead candidateNew
2. 40may not file a submission due to, among other reasons, the content or formatting of the submission59% rewritten
3. 41necessarily result in an expedited regulatory review or approval process or necessarily confer any advantage with respect to approval compared to conventional FDA procedures. Receiving priority review from the FDA does not guarantee approval within the six-month review cycle or at allNew
4. 42A marketing application for a product candidate with RPDD, if approved, may not meet the eligibility criteria for a Priority Review Voucher, or PRV, or the RPDD program may sunset before the FDA is able to consider eligibility for a voucher79% rewritten
5. 43We may seek designation for our EDO platform as a designated platform technology, 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
6. 44The occurrence of any event or penalty described above may inhibit our ability to commercialize our product candidates and generate revenue and could require us to expend significant time and resources in response and could generate negative publicity
7. 45We and our contract manufacturers are subject to significant regulation. The manufacturing facilities on which we rely may not continue to meet regulatory requirements, which could materially harm our business
8. 46If 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 significant costs28% rewritten
9. 47Healthcare legislative reform discourse and potential or enacted measures may increase the difficulty and cost for us and any future collaborators to obtain marketing approval of and commercialize our product candidates and affect the prices we, or they, may obtain67% rewritten
10. 48The Trump Administration may pursue new or different drug pricing, trade, social, and other policy objectives from prior administrations, which introduces further uncertainty as to how future legislative or regulatory changes may impact our businessNew
11. 49the availability of capital31% rewritten
12. 50Our 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
13. 51Laws and regulations governing any international operations we may have in the future may preclude us from developing, manufacturing and selling certain product candidates outside of the U.S. and require us to develop and implement costly compliance programs
14. 52We are subject to stringent data protection, privacy, and security laws, regulations, standards and contractual obligations and actual or perceived failure to comply with such requirements could have a material adverse effect on our business, financial condition, results of operations or prospects40% rewritten
15. 53If any of our product candidates obtains regulatory approval and does not receive appropriate periods of non-patent exclusivity, competitors could enter the market with generic versions of such products more quickly than we expect, which may result in a material decline in sales of our products

Risks Related to Commercialization

1. 54We face substantial competition, which may result in others discovering, developing or commercializing products before us or more successfully than we do88% rewritten
2. 55entirely different approaches. Potential competitors also include academic institutions, government agencies and other public and private research organizations that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing and commercializationNew
3. 56Even if one or more of our product candidates receives marketing approval, it 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. 57any restrictions on the use of our products, if approved, together with other medications
5. 58The estimates of market opportunity and forecasts of market growth included in this Form 10-K, if any, may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, our business may not grow at similar rates, or at all46% rewritten
6. 59neither experimental nor investigational
7. 60If we are unable to establish sales, marketing and distribution capabilities or enter into sales, marketing and distribution agreements with third parties, we may not be successful in commercializing our product candidates if any are approved
8. 61unforeseen costs and expenses associated with creating an independent sales and marketing organization

Risks Related to Our Intellectual Property

1. 62our existing licenses and to compete with our product candidates and our technology. Any of the foregoing could have a material adverse effect on our competitive position, business, financial condition, results of operations and prospects77% rewritten
2. 63the priority of invention of patented technology69% rewritten
3. 64We may not be able to protect our intellectual property rights throughout the world
4. 65We may be involved in lawsuits to protect or enforce our patents or other intellectual property or the intellectual property of our licensors, which could be expensive, time-consuming, and unsuccessful
5. 66Changes in patent law in the U.S. or worldwide could diminish the value of patents in general, thereby impairing our ability to protect our product candidates and our technology
6. 67Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by government patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements
7. 68We may not be successful in obtaining necessary rights to our product candidates through acquisitions and in-licenses
8. 69Issued patents covering our product candidates could be found invalid or unenforceable if challenged in court or before administrative bodies in the U.S. or abroad
9. 70If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed
10. 71Third 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 harm our business
11. 72Intellectual property litigation or other proceedings could cause us to spend substantial resources and distract our personnel from their normal responsibilities
12. 73We 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
13. 74If we do not obtain patent term extension for our product candidates, our business may be harmed
14. 75We may be subject to claims challenging the inventorship or ownership of our patent and other intellectual property rights
15. 76If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected
16. 77Intellectual property rights do not necessarily address all potential threats
17. 78Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor or other third party will discover our trade secrets or that our trade secrets will be misappropriated or disclosed

Risks Related to Employee Matters, Managing Growth and Other Operational Matters

1. 79Our future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel
2. 80We may need to expand our headcount over time to support our development and regulatory capabilities and potentially implement sales, marketing and distribution capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations
3. 81Our international activities subject us to various risks, and our failure to manage these risks could adversely affect our results of operations
4. 82We face risks associated with tariffs and other trade restrictions, which may have a material adverse impact on our results of operations and financial conditionNew
5. 83measures that may limit or complicate the sourcing of raw materials, equipment, and other components critical to our research and development activitiesNew
6. 84Future acquisitions or strategic alliances could disrupt our business and harm our financial condition and results of operations
7. 85litigation or other claims in connection with the acquired company, including claims from terminated employees, customers, former stockholders or other third parties82% rewritten
8. 86proprietary business information and personal information). It is critical that we, our vendors, collaborators and other contractors or consultants, do so in a secure manner to maintain the availability, security, confidentiality, privacy and integrity of such confidential informationNew
9. 87Our operations or those of the third parties upon whom we depend might be affected by the occurrence of a natural disaster, pandemic or other catastrophic event
10. 88The effects of a future pandemic, epidemic or outbreak of an infectious or highly contagious disease, may materially and adversely affect our business and financial results and could cause a disruption in the development of our product candidates27% rewritten

Risks Related to Ownership of Our Common Stock

1. 89The stock price of our common stock has been and may continue to be volatile or may decline regardless of our operating performance and prospects
2. 90Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates
3. 91If securities or industry analysts do not continue to publish research or reports or publish inaccurate or unfavorable research or reports about our business, our stock price and trading volume could decline
4. 92The price of our common stock is volatile and fluctuates substantially, which could result in substantial losses for holders of our common stock
5. 93the other factors described in this “Risk factors” section
6. 94Unfavorable global economic conditions could adversely affect our business, financial condition, stock price and results of operations24% rewritten
7. 95Our executive officers, directors and principal shareholders, if they choose to act together, will continue to have the ability to significantly influence all matters submitted to stockholders for approval
8. 96Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain
9. 97The sale of a significant number of shares of our common stock, or the perception that such sales could occur, could cause the market price of our common stock to drop significantly, even if our business is doing well
10. 98We 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
11. 99exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved
12. 100We cannot predict whether investors will find our common stock less attractive if we rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile
13. 101We incur substantial 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
14. 102Anti-takeover provisions in our corporate charter documents 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 directors and members of management
15. 103require the approval of the holders of at least 66.7% of the votes that all our stockholders would be entitled to cast to amend or repeal specified provisions of our certificate of incorporation or bylaws56% rewritten
16. 104any action asserting a claim arising pursuant to any provision of our certificate of incorporation or bylaws (in each case, as they may be amended from time to time) or governed by the internal affairs doctrine
17. 105We may not be able to continue to satisfy listing requirements of the Nasdaq Global Select Market or maintain a listing of our common stock on the Nasdaq Global Select Market
18. 106Changes in tax laws or regulations or in their implementation or interpretation may adversely affect our business and financial condition75% rewritten
19. 107Tax authorities may disagree with our positions and conclusions regarding certain tax positions, or may apply existing rules in an unforeseen manner, resulting in unanticipated costs, taxes or non-realization of expected benefits
20. 108Our ability to utilize our net operating loss carryforwards and certain other tax attributes may be subject to limitations
21. 109Any restructuring or change in the nature of our operations of our company may give rise to tax liabilities and/or restrictions in the amount and/or availability of tax attributes
22. 110Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud
23. 111As a public company, we are exposed to the risk of securities class action litigation81% rewritten
24. 112We may be exposed to significant foreign exchange risk