Solid Biosciences (SLDB) risk factors, FY2025 10-K

Risks Related to our Financial Position and Need for Capital Requirements

1. 01We have incurred significant net losses since inception and anticipate that we will continue to incur net losses for the foreseeable future and may never achieve or maintain profitability43% rewritten
2. 02add operational, financial and management information systems and personnel20% rewritten
3. 03We will need additional funding, which may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate our product development efforts or other operations
4. 04if and as we need to adapt our business in response to public health emergencies or pandemics and collateral consequences related thereto
5. 05Raising additional capital may cause dilution to our existing stockholders, restrict our operations or require us to relinquish rights to our technologies or Candidates
6. 06We have never generated revenue from product sales and do not expect to do so for the foreseeable future, if ever
7. 07Our limited operating history may make it difficult for our stockholders to evaluate the success of our business to date and to assess our future viability
8. 08Unfavorable global economic conditions could harm our business, financial condition or results of operations
9. 09We hold a portion of our cash and cash equivalents that we use to meet our working capital and operating expense needs in deposit accounts that could be adversely affected if the financial institutions holding such funds fail

Risks Related to the Development of our Candidates

1. 10In addition, our ability to conduct and complete our preclinical development testing and studies is contingent on our ability to source animals and other supplies required for the conduct of such testing and studies and the performance of animal models
2. 11Our Candidates may cause undesirable side effects or have other properties that could delay or prevent their clinical development, regulatory approval, limit their commercial potential or result in significant negative consequences following any potential marketing approval25% rewritten
3. 12activated, the cellular immune response system may trigger the removal of transduced cells. If our gene transfer Candidates demonstrate a similar effect or other undesirable side effects, we may decide or be required to halt or delay further clinical development of our Candidates involving AAV capsids for gene therapy
4. 13One of our prior clinical trials had been placed on clinical hold by the FDA in the past, and we cannot guarantee that similar events will not happen in ongoing, planned and future clinical trials for our Candidates21% rewritten
5. 14We have never completed a clinical trial and may be unable to do so for any Candidate, including SGT-003, SGT-212, SGT-501 and other Candidates24% rewritten
6. 15Success in preclinical studies or early clinical trials may not be indicative of results obtained in later trials
7. 16Preliminary or interim data that we announce or publish from time to time may change as more data becomes available and are subject to audit and verification procedures that could result in material changes in the final data
8. 17We may encounter substantial delays in our clinical trials or we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatory authorities
9. 18changes in regulatory requirements and guidance that require amending or submitting new clinical protocols
10. 19experience damage to our reputation
11. 20If our third-party clinical trial vendors fail to comply with strict regulations, any clinical trials for our Candidates may be delayed or unsuccessful33% rewritten
12. 21We may find it difficult to enroll participants in our clinical trials, which could delay or prevent us from proceeding with clinical trials of SGT-003, SGT-212, SGT-501 or our other Candidates28% rewritten
13. 22in the case of pivotal trials, the risk that participants may opt not to enroll because they are not assured treatment with our Candidate56% rewritten
14. 23We plan to conduct clinical trials at sites outside the United States. The FDA may not accept data from trials conducted in such locations, and the conduct of trials outside the United States could subject us to additional delays and expense
15. 24interruptions or delays resulting from geopolitical events, such as wars29% rewritten
16. 25Even if we complete the necessary clinical trials, we cannot predict when, or if, we will obtain regulatory approval to commercialize our Candidates and the approval may be for a narrower indication than we seek24% rewritten
17. 26Even if we obtain regulatory approval for a Candidate, our Candidates will remain subject to regulatory oversight
18. 27litigation involving patients using our products
19. 28Any regulatory approval to market our products will be limited by indication. If we fail to comply or are found to be in violation of FDA regulations restricting the promotion of our products for unapproved uses, we could be subject to criminal penalties, substantial fines or other sanctions and damage awards
20. 29Even if we obtain and maintain approval of one or more of our Candidates from the FDA, we may never obtain approval for our Candidates outside of the United States, which would limit our market opportunities and adversely affect our business26% rewritten
21. 30Changes in and uncertainty surrounding U.S. and international trade policies, particularly with respect to China, may adversely impact our business and operating resultsNew
22. 31Regulatory requirements governing gene therapy products are periodically updated and may continue to change in the future53% rewritten
23. 32specifically, the FDA typically recommends that sponsors continue to monitor participants for potential gene therapy‑related adverse events for up to a 5-year period. Other types of gene therapy or gene editing products may require longer follow up, potentially up to a maximum 15-year periodNew
24. 33We may not be able to obtain orphan drug exclusivity for one or more of our Candidates, and even if we do, that exclusivity may not prevent the FDA or the EMA from approving other competing products
25. 34The FDA has granted orphan drug designation to SGT-003 for the treatment of Duchenne, SGT-212 for the treatment of FA and to SGT-501 for the treatment of CPVT
26. 35We may seek a breakthrough therapy designation for one or more of our Candidates, but we might not receive such designation, and even if we do, such designation may not lead to a faster development or regulatory review or approval process
27. 36Accelerated approval by the FDA, even if granted for one or more of our Candidates, may not lead to a faster development or regulatory review or approval process and it does not increase the likelihood that our Candidates will receive marketing approval
28. 37A potential regenerative medicine advanced therapy designation by the FDA for our Candidates may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that our Candidates will receive marketing approval
29. 38We may seek PRIME Designation in the EU for one or more of our Candidates, but we might not receive such designations and, even if we do, such designations may not lead to a faster development or regulatory review or approval process
30. 39We may seek a Rare Pediatric Disease Designation for our Candidates. However, a BLA for such Candidates may not meet the eligibility criteria for a priority review voucher upon approval
31. 40The FDA has granted rare pediatric disease designation to SGT-003 for the treatment of Duchenne, SGT-212 for the treatment of FA and SGT-501 for the treatment of CPVT
32. 41We may seek priority review designation for one or more of our Candidates, but we might not receive such designation, and even if we do, such designation may not lead to a faster development or regulatory review or approval process58% rewritten
33. 42We are also aware of several companies and research institutions conducting clinical trials in small molecule product candidates focused on CPVT, including Cardurion Pharmaceuticals Inc., with an orally administered CAMKII-delta inhibitor candidate in a Phase 2 clinical trialNew
34. 43We may fail to capitalize on other potential Candidates that may represent a greater commercial opportunity or for which there is a greater likelihood of success82% rewritten
35. 44prove to have greater commercial potential than our Candidates. For example, in September 2022, we announced that we would be pausing activities for SGT-001, which we are no longer developingNew

Risks Related to the Manufacturing and Commercialization of our Candidates

1. 45We have entered into, and may in the future enter into, collaborations with third parties for the development or commercialization of our Candidates. If our collaborations are not successful, we may not be able to capitalize on the market potential of these Candidates and our business could be adversely affected
2. 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 Candidates
3. 47We may not be successful in finding strategic collaborators for continuing development of our Candidates or platform technologies, or for successfully commercializing or competing in the market for certain indications
4. 48We also may encounter problems hiring and retaining the experienced scientific, quality control and manufacturing personnel needed to oversee our manufacturing and quality control process, which could result in delays in our production or difficulties in maintaining compliance with applicable regulatory requirements
5. 49We expect to utilize third parties to conduct our product manufacturing for the foreseeable future. Therefore, we are subject to the risk that these third parties may not perform satisfactorily or meet regulatory requirements
6. 50If we are unable to establish sales, distribution and marketing capabilities or enter into agreements with third parties to market and sell our Candidates, we will be unable to generate any product revenue
7. 51If we are unable to establish medical affairs capabilities, we will be unable to establish an educated market of physicians to administer any future products
8. 52If the market opportunities for any of our future products are smaller than we believe they are, our revenue prospects may be adversely affected and our business may suffer
9. 53Certain patients’ immune systems might prohibit the successful delivery of certain gene therapy products, thereby potentially limiting the population of patients amenable to gene transfer
10. 54The commercial success of any of our Candidates, if approved, will depend upon market acceptance by physicians, patients, third-party payors and others in the medical community
11. 55Even if a potential Candidate displays a favorable efficacy and safety profile in preclinical studies and clinical trials, market acceptance of the product will not be fully known until after it is launched
12. 56Given the nature of biologics manufacturing, there is a risk of contamination in our manufacturing processes. Any contamination could materially adversely affect our ability to produce our Candidates on schedule and could cause reputational damage
13. 57The insurance coverage and reimbursement status of newly approved products is uncertain. Failure to obtain or maintain adequate coverage and reimbursement for our Candidates, if approved, could limit our ability to market those products and decrease our ability to generate product revenue
14. 58neither experimental nor investigational
15. 59Governments outside the United States tend to impose strict price controls, which may adversely affect our revenue, if any
16. 60If we obtain approval to commercialize our future products outside of the United States, in particular in the European Union, a variety of risks associated with international operations could materially adversely affect our business
17. 61If we engage in future acquisitions or strategic collaborations, this may increase our capital requirements, dilute our stockholders, cause us to incur debt or assume contingent liabilities and subject us to other risks
18. 62our inability to generate revenue from acquired technology and/or products sufficient to meet our objectives in undertaking the acquisition or collaboration or even to offset transaction costs

Risks Related to our Business Operations

1. 63Our future success depends on our ability to retain key employees, consultants and advisors and to attract, retain and motivate qualified personnel
2. 64If we are unable to manage growth in the scale and complexity of our operations, our performance may suffer
3. 65Our employees may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements, which could cause significant liability for us and harm our reputation
4. 66Enacted and future legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our Candidates and may affect the prices we may set
5. 67Changes in tax laws or in their implementation or interpretation could adversely affect our business and financial conditionNew
6. 68Current and future legislative efforts may limit the prices for our products, if and when they are licensed for marketing and that could materially impact our ability to generate revenues68% rewritten
7. 69and state governments will pay for healthcare products and services, which could result in reduced demand for our Candidates or additional pricing pressuresNew
8. 70the level of taxes that we are required to pay
9. 71state and foreign laws that govern the privacy and security of 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 efforts86% rewritten
10. 72goodwill, any of which could have a material adverse effect on our business, financial condition, results of operations or prospectsNew
11. 73Product liability lawsuits against us could cause us to incur substantial liabilities and could limit commercialization of any Candidate that we may develop
12. 74injury to our reputation and significant negative media attention
13. 75If we 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 business31% rewritten
14. 76Our internal computer systems, or those of our collaborators, contractors or consultants, may fail or suffer security breaches, which could result in a material disruption of our product development

Risks Related to our Intellectual Property

1. 77We heavily rely on certain in-licensed patents and other intellectual property rights in connection with our development of our Candidates and may be required to acquire or license additional patents or other intellectual property rights to continue to develop and commercialize our Candidates
2. 78The patent prosecution process is expensive, time-consuming and complex, and we and our licensors may not be able to file, prosecute, maintain, enforce, defend or license all necessary or desirable patents and patent applications at a reasonable cost or in a timely manner72% rewritten
3. 79patent laws or interpretation of the patent laws in the United States and other jurisdictions may diminish the value of our patents or narrow the scope of our patent protectionNew
4. 80Our licensed patents, and any patents we may own in the future, may be challenged, narrowed, invalidated or held unenforceable
5. 81Our intellectual property licenses with third parties may be subject to disagreements over contract interpretation, which could narrow the scope of our rights to the relevant intellectual property or technology or increase our financial or other obligations to our licensors
6. 82If we fail to comply with our obligations in the agreements under which we license intellectual property rights from third parties or otherwise experience disruptions to our business relationships with our licensors, we could lose license rights that are important to our business
7. 83the priority of invention of licensed patented inventions
8. 84Third 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 have a material adverse effect on the success of our business
9. 85Intellectual property litigation could cause us to spend substantial resources and distract our personnel from their normal responsibilities
10. 86Obtaining 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
11. 87We may not be able to protect our intellectual property and proprietary rights throughout the world
12. 88If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed
13. 89We 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
14. 90Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our Candidates73% rewritten
15. 91implement various regulations. However, the Leahy-Smith Act and its implementation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patentsNew
16. 92If we do not obtain patent term extension for patents relating to our Candidates, our business may be materially harmed
17. 93If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition and our business may be adversely affected
18. 94Intellectual property rights and regulatory exclusivity rights do not necessarily address all potential threats
19. 95If approved, our Candidates that are licensed and regulated as biologics may face competition from biosimilars approved through an abbreviated regulatory pathway

Risks Related to Ownership of our Common Stock

1. 96Our executive officers, directors and principal stockholders maintain the ability to control or significantly influence all matters submitted to our stockholders for approval
2. 97A significant number of our total outstanding shares may be sold into the market in the near future, which could cause the market price of our common stock to drop significantly, even if our business is performing well75% rewritten
3. 98substantial number of shares of our common stock have rights, subject to certain conditions, to require us to file registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or other stockholdersNew
4. 99In addition, we have filed registration statements registering all shares of common stock that we may issue under our equity compensation plans. These shares can be freely sold in the public market upon issuance, subject to black-out periods and volume limitations applicable to affiliates34% rewritten
5. 100The price of our common stock has been, and in the future is likely to be, volatile and fluctuate substantially, which could result in substantial losses for holders of our common stock
6. 101If our quarterly operating results fall below the expectations of investors or securities analysts, the price of our common stock could decline substantially. Furthermore, any quarterly fluctuations in our operating results may, in turn, cause the price of our stock to fluctuate substantially
7. 102An active trading market for our common stock may not be sustained
8. 103We are a “smaller reporting company” and the reduced disclosure requirements applicable to smaller reporting companies may make our common stock less attractive to investors
9. 104We incur increased costs as a result of operating as a public company, and our management is required to devote substantial time to new compliance initiatives
10. 105Provisions in our certificate of incorporation and our bylaws and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management
11. 106require the approval of the holders of at least two-thirds of the votes that all our stockholders would be entitled to cast to amend or repeal certain provisions of our certificate of incorporation or bylaws
12. 107Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, is the only sole source of gain for an investment in our common stock