Prokidney (PROK) risk factors, FY2025 10-K

Risks Related to Our Financial Position and Need for Additional Capital

1. 01We have incurred significant net losses since inception and we expect to continue to incur significant net losses for the foreseeable future
2. 02invest in or in-license other technologies or product candidates
3. 03the costs of operating as a public company

Risks Related to Research and Development of Rilparencel and Our Future Product Candidates

1. 04We have a limited operating history and have not generated any revenue to date, and may never become profitable
2. 05The market for biologics and for the treatment of kidney disease is highly competitive. If we fail to effectively compete, our business, financial condition and operating results will suffer
3. 06Many of our current competitors may have competitive advantages over us, including significantly greater financial resources and expertise in research and development, preclinical testing, clinical trials, manufacturing and marketing than we have
4. 07relative convenience of dosing and administration
5. 08obsolescence of manufacturing automation which could require a re-design of parts or equipment to ensure quality replacement component, the delays of which could cause significant delays in manufacturing and loss of sales
6. 09Rilparencel is based on a novel technology, which makes it difficult to predict the time and cost of product development and of subsequently obtaining regulatory approval
7. 10We must be able to overcome these challenges in order for us to develop, commercialize and manufacture rilparencel
8. 11the proprietary rights of others and their competing products and technologies that may prevent one of our product candidates from being commercialized
9. 12interruption of our manufacturing processes, which could lead to our inability to properly administer treatment
10. 13any future collaborators that conduct clinical trials may face any of the above issues, and may conduct clinical trials in ways they view as advantageous to them but that are suboptimal for us
11. 14have regulatory authorities withdraw or suspend their approval of the product or to impose restrictions on its distribution after obtaining marketing approval
12. 15Any topline data or interim analyses from our nonclinical studies and clinical trials that may be announced or published from time to time may change as more data becomes available and will remain subject to audit and verification procedures that could result in material changes in the final data
13. 16the approval policies or regulations of the FDA or comparable foreign authorities may significantly change in a manner rendering our clinical data insufficient for approval
14. 17We may fail to demonstrate with substantial evidence from adequate and well-controlled trials, and to the satisfaction of the FDA or comparable foreign regulatory authorities, that rilparencel is safe and potent for its intended uses
15. 18our reputation and physician or patient acceptance of our products may suffer
16. 19Negative public opinion and increased regulatory scrutiny of autologous cell therapy using rilparencel may adversely impact the development or commercial success of our current and future product candidates
17. 20We are conducting our first Phase 3 clinical trial and may be unable to successfully complete it or any future clinical trials
18. 21We have and may continue to encounter difficulties enrolling patients in our clinical trials, and our clinical development activities have been and may continue to be delayed or otherwise adversely affected
19. 22the risk that subjects enrolled in clinical trials will drop out of the trials before completion40% rewritten
20. 23The design or execution of our ongoing and future clinical trials may not support marketing approval91% rewritten
21. 24any clinical trials we conduct will demonstrate consistent or adequate efficacy and safety to obtain the marketing approvals necessary to commercialize rilparencel or any of our future product candidatesNew
22. 25We 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
23. 26We have conducted and may in the future continue to conduct additional clinical trials for rilparencel outside the United States, and the FDA and similar foreign regulatory authorities may not accept data from such trials conducted in locations outside of their jurisdiction
24. 27We may not be successful in our efforts to identify or discover additional product candidates in the future
25. 28potential product candidates may, on further study, be shown to have harmful side effects or other characteristics that indicate that they are unlikely to be medicines that will receive marketing approval and achieve market acceptance
26. 29Due to our limited resources and access to capital, we must make decisions on the allocation of resources to certain programs and product candidates; these decisions may prove to be wrong and may adversely affect our business
27. 30If we do not achieve our projected development goals in the time frames we announce and expect, the commercialization of our products may be delayed or never achieved

Risks Related to the Manufacturing of Rilparencel and Our Future Product Candidates

1. 31Cell therapies are complex and difficult to manufacture, and we have experienced and may continue to experience manufacturing problems that result in delays in the development or commercialization of rilparencel, our lead product candidate, or otherwise harm our business
2. 32plans. Any changes in the manufacturing of components of the raw materials we use could result in unanticipated or unfavorable effects in our manufacturing processes, resulting in delaysNew
3. 33These factors could cause the delay of clinical trials, regulatory submissions, required approvals or commercialization of rilparencel, cause us to incur higher costs and prevent us from commercializing rilparencel successfully, if approved28% rewritten
4. 34We have our own manufacturing capabilities, which may result in increased costs being incurred by us
5. 35our ability to fund ongoing development, including equipment requirements necessary for successful manufacture of cell therapies at our facility
6. 36Contract development and manufacturing organizations have a finite cell manufacturing capacity, which could inhibit the long-term growth prospects of our business
7. 37Our autologous cell therapy products are patient-specific, and we need to ensure that the correct product is administered to the correct patient
8. 38We do not have experience as a company managing a complex supply chain or satisfying manufacturing-related regulatory requirements
9. 39Any of the above events, should they happen, could adversely affect our development timelines and our business, financial condition, results of operations and prospects
10. 40Given the nature of cell product manufacturing, there is a risk of microbial contamination. Any microbial contamination could adversely affect our ability to produce, release or administer our cell therapies on schedule and could, therefore, harm our results of operations and cause reputational damage
11. 41Rilparencel requires cryopreservation with specific storage, handling and administration at the clinical sites
12. 42Changes in methods of product candidate manufacturing or formulation may result in additional costs or delay

Risks Related to the Commercialization of Rilparencel and Our Future Product Candidates

1. 43Even if rilparencel or a future product candidate we develop 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
2. 44the ability to provide advanced procedural training for delivery of product candidates30% rewritten
3. 45capabilities or enter into agreements with third parties to market and sell any products for which we obtain regulatory approval, we may not be able to generate product revenueNew
4. 46unforeseen costs and expenses associated with creating an independent sales and marketing organization
5. 47The affected populations for rilparencel or any of our future product candidates may be smaller than we or third parties currently project, which may affect the addressable markets for rilparencel or our future product candidates
6. 48Obtaining and maintaining regulatory approval of rilparencel or any of our future product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of rilparencel or future product candidates in other jurisdictions
7. 49Off-label use or misuse of our products may harm our reputation in the marketplace, result in injuries that lead to costly product liability suits, and/or subject us to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with any product
8. 50Rilparencel and our future product candidates for which we intend to seek approval as biologic products may face competition sooner than anticipated, and our operating results will suffer if we fail to compete effectively
9. 51Coverage and reimbursement may be limited or unavailable in certain market segments for rilparencel or our future product candidates, if approved, which could make it difficult for us to sell any product candidates profitably
10. 52neither experimental nor investigational
11. 53If product liability lawsuits are brought against us, we may incur substantial financial or other liabilities and may be required to limit commercialization of rilparencel or our future product candidates
12. 54decline in our share price
13. 55If we or any contract manufacturers and suppliers we engage, now or in the future, fail to comply with environmental, health, and safety laws and regulations, we could become subject to fines or penalties or incur costs that could substantially harm our business

Risks Related to Our Reliance on Third Parties

1. 56We also are required to register certain ongoing clinical trials and post the results of certain completed clinical trials on a government-sponsored database, ClinicalTrials.gov, within specified timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions
2. 57We rely on third parties for materials, including tissue samples, required for our research and development activities, and if we are unable to reach agreements with these third parties our research and development activities would be delayed
3. 58collaborations may be terminated by 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. 59Additionally, if one of our collaborators terminates its agreement with us, we may find it more difficult to attract new collaborators and our perception in the business and financial communities could be adversely affected

Risks Related to Legal and Regulatory Compliance Matters

1. 60comply with regulatory requirements or experience unanticipated problems with rilparencel or any of our future product candidatesNew
2. 61consent decrees, injunctions or the imposition of civil or criminal penalties
3. 62Changes in health care policies, laws and regulations, including legislative measures aimed at reducing health care costs, may impact our ability to obtain approval for, or commercialize rilparencel or any of our future product candidates, if approved21% rewritten
4. 63Any additional federal or state health care reform measures could limit the amounts that third-party payers will pay for future health care products and services, and, in turn, could significantly reduce the projected value of certain development projects and reduce our profitability74% rewritten
5. 64We may incur substantial costs in our efforts to comply with evolving global data protection laws and regulations, and any failure or perceived failure by us to comply with such laws and regulations may harm our business and operations
6. 65Legal, political and economic uncertainty relating to our international operations could negatively impact or restrict our operations57% rewritten
7. 66Our executive officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests74% rewritten

Risks Related to Our Intellectual Property

1. 67Our success depends in part on our ability to protect our intellectual property. It is difficult and costly to protect our proprietary rights and technology, and we may not be able to ensure their protection
2. 68We cannot be certain that we were the first to file any patent application related to our technology, including rilparencel, and, if we were not, we may be precluded from obtaining patent protection for our technology, including rilparencel
3. 69We may enter into license or other collaboration agreements in the future that may impose certain obligations on us. If we fail to comply with our obligations under such future agreements with third parties, we could lose license rights that may be important to our future business
4. 70the priority of invention of patented technology
5. 71If we are unable to protect the confidentiality of our trade secrets, the value of our technology could be negatively impacted, and our business and competitive position would be harmed64% rewritten
6. 72Third-party claims of intellectual property infringement may be costly and time consuming to defend and could prevent or delay our product discovery, development and commercialization efforts
7. 73redesigning rilparencel or processes so they do not infringe, which may not be possible or may require substantial monetary expenditures and time
8. 74Third parties may assert that we are employing their proprietary technology without authorization
9. 75Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets
10. 76We may not identify relevant third-party patents 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 products82% rewritten
11. 77Rilparencel, our current product candidate, may require specific formulations to work effectively and efficiently and these rights may be held by others. We may develop products containing our compounds and pre-existing biopharmaceutical compoundsNew
12. 78We may be involved in lawsuits to protect or enforce our patents or the patents of our licensors, or challenging the patent rights of others, which could be expensive, time-consuming and unsuccessful37% rewritten
13. 79Obtaining 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
14. 80Certain patents covering rilparencel could be found invalid or unenforceable if challenged in court or the USPTO
15. 81Changes in patent law in the United States, changes in the administration’s interpretation of the law, or changes in the law in other jurisdictions could diminish the value of patents in general, thereby impairing our ability to protect our products
16. 82We have limited foreign intellectual property rights and may not be able to protect and enforce our intellectual property rights throughout the world46% rewritten
17. 83Any trademarks we have obtained or may obtain may be infringed or otherwise violated, or successfully challenged, resulting in harm to our business

Risks Related to Managing Our Business and Operations

1. 84improving our operational, financial and management controls, reporting systems and procedures
2. 85If we lose key management personnel, or if we fail to recruit additional highly skilled personnel, our ability to continue developing rilparencel or identify and develop new product candidates will be impaired, which could result in loss of markets or market share and could make us less competitive
3. 86Competition for skilled personnel in our industry is intense and may limit our ability to hire and retain highly qualified personnel on acceptable terms or at all
4. 87Our employees, independent contractors, consultants, collaborators, principal investigators, CROs, suppliers and vendors may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements
5. 88Our internal computer systems, or those of our collaborators or other contractors or consultants, may fail or suffer security breaches, which could result in a material disruption of our product development programs
6. 89We rely upon cloud services to operate certain aspects of our business and any disruption of or interference with our use of cloud services would impact our operations and our business would be adversely impacted
7. 90Failure to comply with health and data protection laws and regulations could lead to government enforcement actions (which could include civil or criminal penalties), private litigation, and/or adverse publicity and could negatively affect our operating results and business
8. 91Changes in tax law or policy could increase our effective tax rate and tax liability or the taxes payable by holders of our common stock, each of which could have a material adverse effect on our business, financial condition and results of operations
9. 92Our effective tax rate may fluctuate, and we may incur obligations in tax jurisdictions in excess of accrued amounts59% rewritten
10. 93Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our financial condition and results of operations
11. 94Our principal shareholders have significant influence over us, including over decisions that require the approval of shareholders, and their interests may conflict with the interests of holders of ProKidney Corp. Class A common stock92% rewritten
12. 95director and have indirect control over the approval of significant corporate transactions, including any merger, consolidation or sale of all or substantially all of our assets and the issuance or redemption of equity interests in certain circumstances, to the extent such matters require approval of the BoardNew
13. 96Provisions in our corporate governance documents and Delaware law may prevent or delay an acquisition of our business, which could decrease the market price of our common stockNew
14. 97The JOBS Act permits “emerging growth companies” like us to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies21% rewritten
15. 98Our internal controls over financial reporting may not be effective and our independent registered public accounting firm may not be able to certify as to their effectiveness, which could have a significant and adverse effect on our business and reputation
16. 99Increased prices and inflation could negatively impact our margin performance and our financial results
17. 100Geopolitical risks could result in increased market volatility and uncertainty, which could negatively impact our business, financial condition, and results of operations27% rewritten
18. 101There have been significant changes and continue to be ongoing discussion and commentary regarding potential significantNew
19. 102The stock market is volatile, and fluctuations in our operating results, removal from various indices and other factors could cause our stock price to declineNew
20. 103Our failure to meet the continued listing requirements of NASDAQ could result in the de-listing of our Class A common stockNew

Risks Related to our Organizational Structure

1. 104We are a holding company, and our only material asset is our interest in PK Holdings, and we are accordingly dependent upon distributions made by our subsidiaries to pay taxes, make payments under the Tax Receivable Agreement and pay dividends36% rewritten
2. 105In certain circumstances, PK Holdings will be required to make distributions to us and the other holders of ProKidney Common Units, and the distributions that PK Holdings will be required to make may be substantial67% rewritten
3. 106In certain cases, payments under the Tax Receivable Agreement may exceed the actual tax benefits we realize or may be accelerated22% rewritten
4. 107payments under the Tax Receivable Agreement for any reason, such payments will be deferred and will accrue interest until paid, which could negatively impact our results of operations and could also affect our liquidity in periods in which such payments are madeNew