What the changes say
- Spero Therapeutics faces heightened operational risks regarding clinical trial uncertainties, debt financing needs, and external macroeconomic pressures like new tariffs and tax laws.
What changed since the prior 10-K
New
- NewRisks Related to Product Development and Commercialization
obtain these approvals. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome
Clinical development of product candidates carries inherent risks of failure, adverse events, or unfavorable regulatory interpretations.
- NewRisks Related to Product Development and Commercialization
We therefore do not know whether any clinical trials we may conduct will demonstrate consistent or adequate efficacy and safety sufficient to obtain marketing approval to market our existing or future product candidates
Undesirable side effects or safety issues could halt clinical trials, delay regulatory approvals, or restrict commercial distribution.
- NewRisks Related to Product Development and Commercialization
If 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
Acquisitions or strategic collaborations may increase capital requirements, dilute stockholders, or create integration and management distraction challenges.
- NewRisks Related to Product Development and Commercialization
our 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
Acquired technologies may fail to generate sufficient revenue to meet objectives or offset transaction costs and future amortization expenses.
- NewRisks Related to Our Financial Position and Need for Additional Capital
If we are unable to raise capital when needed, or do not receive payments from our collaboration partnership agreements, it could limit our ability to support our operations
Developing pharmaceutical products is expensive, and failure to raise capital or receive partner payments will limit operations.
- NewRisks Related to Our Dependence on Third Parties
We are a party to agreements with Meiji and GSK for tebipenem HBr and we may enter into additional agreements, including license agreements, with other parties in the future that impose diligence, development and commercialization timelines, milestone payments, royalties, insurance and other obligations on us
Agreements with Meiji and GSK impose strict diligence, development milestones, royalties of 1% on net sales, and future milestone payments up to $1.0 million.
- NewRisks Related to Regulatory Approval and Other Legal Compliance Matters
Since the United Kingdom left the EU prior to the date on which the EU CTR took effect, the U.K. legal framework did not benefit from the same revisions as occurred at EU level
Unclear functioning of the new U.K. international recognition procedure could delay product marketing approvals in the United Kingdom.
- NewRisks Related to Regulatory Approval and Other Legal Compliance Matters
Changes in tax laws or in their implementation or interpretation could adversely affect our business and financial condition
New tax legislation such as the IRA excise tax and OBBBA may adversely impact our effective tax rate, tax liabilities, and cash obligations.
- NewRisks Related to Regulatory Approval and Other Legal Compliance Matters
Changes in and uncertainty surrounding U.S. and international trade policies may adversely impact our business and operating results
U.S. and international tariffs and retaliatory measures between the U.S., China, and other trading partners create trade policy uncertainty.
- NewRisks Related to Regulatory Approval and Other Legal Compliance Matters
Neither the Supreme Court’s decision nor the Executive Order revoking the IEEPA tariffs addressed refunds, leaving the issue to renewed proceedings before the U.S. Court of International Trade, where importers may need to pursue administrative remedies and/or litigation amid continued uncertainty
Potential 100% tariffs on imported branded drugs and Section 232 investigations threaten research and manufacturing reliance on Chinese CMOs.
- NewRisks Related to Employee Matters and Managing Growth
We undertook internal restructuring activities that could result in disruptions to our business or otherwise materially harm our results of operations or financial condition
An October 2024 workforce reduction and restructuring may cause operational disruptions, loss of accumulated knowledge, and management distraction.
Dropped
- DroppedRisks Related to Product Development and Commercialization
country. Adverse pricing limitations may hinder our ability to recoup our investment in one or more product candidates, even if our product candidates obtain marketing approval
- DroppedRisks Related to Our Financial Position and Need for Additional Capital
We expect that we will need substantial additional funding. If we are unable to raise capital when needed, or do not receive payments under our government awards or from our commercial partnership agreements, we could be forced to delay, reduce or eliminate our product development programs
- DroppedRisks Related to Our Dependence on Third Parties
If we fail to comply with our obligations in the agreements under which we in-license or out-license acquire development or commercialization rights to products, technology or data from or to third parties, we could lose such rights that are important to our business
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
Our use of government funding for certain of our programs adds complexity to our research and commercialization efforts with respect to those programs and may impose requirements that increase the costs of commercialization and production of product candidates developed under those government-funded programs
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
pursue criminal or civil remedies under the False Claims Act (the “FCA”), the False Statements Act and similar remedy provisions specific to government agreements
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
public disclosures of certain award information, which may enable competitors to gain insights into our research program; and
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
U.S. government agencies have special contracting requirements that give them the ability to unilaterally control our contracts
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
change certain terms and conditions in our contract
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
United States government agencies such as the DHHS and the Defense Contract Audit Agency (the “DCAA”) routinely audit and investigate government contractors. These agencies review a contractor’s performance under its contracts, cost structure and compliance with applicable laws, regulations and standards
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
Laws and regulations affecting government contracts make it more expensive and difficult for us to successfully conduct our business
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
laws, regulations and executive orders restricting the use and dissemination of information classified for national security purposes and the exportation of certain products and technical data
- DroppedRisks Related to Our U.S. Government Contracts and to Certain Grant Agreements
Provisions in our U.S. government contracts, including our contracts with BARDA, may affect our intellectual property rights
- DroppedRisks Related to Regulatory Approval and Other Legal Compliance Matters
While we have negotiated a SPA agreement with the FDA relating to our pivotal Phase 3 clinical trial of tebipenem HBr in patients with cUTI, including AP, this agreement does not guarantee approval of tebipenem HBr or any other particular outcome from regulatory review of the clinical trial or the product candidate
- DroppedRisks Related to Employee Matters and Managing Growth
We undertook internal restructuring activities that could result in disruptions to our business or otherwise materially harm our results of operations or financial condition, and we may not realize the expected benefits from our restructuring and we may incur additional costs implementing it or other difficulties
- DroppedRisks Related to Our Common Stock
Our shares of common stock could be delisted from the Nasdaq GS, which could result in, among other things, a decline in the price of our common stock and less liquidity for our stockholders
Hospital inpatient bundled payment systems might limit reimbursement and hinder our ability to recoup investments.
- DroppedRisks Related to Our Common Stock
addition, if one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline
- DroppedRisks Related to Our Common Stock
We have received a “Wells Notice” from the SEC contemplating a civil enforcement action, which could have a material adverse effect on our business, financial condition and results of operations, prospects, and/or our stock price
Reworded
- 93% rewrittenRisks Related to Product Development and Commercialization
If our clinical trials fail to produce favorable results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of any existing and future product candidates
Added specific references to European Medicines Agency formatting and broadened the scope to any existing and future product candidates.
Was: If our clinical trials fail to produce favorable results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of such product candidates
- 92% rewrittenRisks Related to Regulatory Approval and Other Legal Compliance Matters
Priority review designation by the FDA may not lead to a faster regulatory review or approval process and, in any event, does not assure FDA approval
Retained identical risk text regarding FDA priority review designation while updating the risk index number.
- 88% rewrittenRisks Related to Our Common Stock
If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline
Expanded analyst coverage risk to include loss of financial market visibility and share price or trading volume declines if analysts cease coverage.
- 86% rewrittenRisks Related to Regulatory Approval and Other Legal Compliance Matters
If we or our partners are unable to obtain marketing approval in international jurisdictions, we will not be able to market our existing or future product candidates abroad
Added a sentence highlighting that the time required to obtain international regulatory approvals may differ substantially from FDA approval.
Was: If we or our partners are unable to obtain marketing approval in international jurisdictions, we will not be able to market our product candidates abroad
- 81% rewrittenRisks Related to Product Development and Commercialization
Even if we or our partners are able to commercialize our existing or future product candidates, the product may become subject to unfavorable pricing regulations, or third-party payor coverage and reimbursement policies that could harm our business
Added 'in that country' to the end of the risk description regarding foreign pricing regulations and delayed commercial launches.
Was: Even if we or our partners are able to commercialize any of our product candidates, the product may become subject to unfavorable pricing regulations, or third-party payor coverage and reimbursement policies that could harm our business
- 76% rewrittenRisks Related to Regulatory Approval and Other Legal Compliance Matters
Our employees, independent contractors, principal investigators, contract research organizations, consultants or vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements
Maintained the exact risk text regarding employee or third-party misconduct and healthcare fraud laws while shifting index numbers.
- 62% rewrittenRisks Related to Product Development and Commercialization
Analyses of preliminary or interim data from our clinical studies 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
Inserted references to 'existing or future product candidates' regarding preliminary or interim clinical trial data analyses.
- 60% rewrittenRisks Related to Product Development and Commercialization
the risk that participants enrolled in clinical trials will drop out of the trials before completion
Updated clinical trial enrollment delay consequences to apply broadly to 'any existing or future product candidates' rather than specific ones.
- 60% rewrittenRisks Related to Regulatory Approval and Other Legal Compliance Matters
Recently enacted and future policies and legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize any of our product candidates and may affect the reimbursement made for any product candidate for which we receive marketing approval
Was: Recently enacted and future policies and legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates and may affect the reimbursement made for any product candidate for which we receive marketing approval
- 57% rewrittenRisks Related to Our Financial Position and Need for Additional Capital
Our ability to use our net operating loss carryforwards may be limited
- 51% rewrittenRisks Related to Regulatory Approval and Other Legal Compliance Matters
A fast track designation may not actually lead to a faster development or regulatory review or approval process
- 47% rewrittenRisks Related to Our Common Stock
We may become involved in securities litigation that could divert management’s attention and harm our business, and insurance coverage may not be sufficient to cover all costs and damages
Was: We may become involved in securities litigation that could divert management’s attention and harm the company’s business, and insurance coverage may not be sufficient to cover all costs and damages
- 46% rewrittenRisks Related to Our Financial Position and Need for Additional Capital
Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to any of our technologies or product candidates
Was: Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates
- 42% rewrittenRisks Related to Our Common Stock
An active trading market for our common stock may not be sustained
Was: An active trading market for our common stock may never develop or be sustained
- 39% rewrittenRisks Related to Our Common Stock
the other factors described in this “Risk Factors” section
- 35% rewrittenRisks Related to Our Financial Position and Need for Additional Capital
acquire or in-license other product candidates and technologies
- 35% rewrittenRisks Related to Product Development and Commercialization
We cannot predict whether bacteria may develop resistance to our product candidate, if approved, which could affect its revenue potential
Was: We cannot predict whether bacteria may develop resistance to our product candidates, if approved, which could affect their revenue potential
- 31% rewrittenRisks Related to Employee Matters and Managing Growth
Our future success depends on our ability to retain our key executives and to attract, retain and motivate qualified personnel
- 27% rewrittenRisks Related to Product Development and Commercialization
We 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
- 24% rewrittenRisks Related to Product Development and Commercialization
be required to remove the product from the market after obtaining marketing approval
All 75 risk factors
Headings as the filing states them, in filing order.
Risks Related to Product Development and Commercialization
- 01Our ability to realize the value of tebipenem HBr depends on obtaining FDA approval. Even if such approval is obtained, the timeline of, and any requirements imposed as part of, such approval may impact the attractiveness of commercialization of tebipenem HBr through our partnership with GSK
- 02If our clinical trials fail to produce favorable results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of any existing and future product candidates93% rewritten
- 03obtain these approvals. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcomeNew
- 04the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval
- 05be required to remove the product from the market after obtaining marketing approval24% rewritten
- 06If we experience delays or difficulties in the enrollment of patients in clinical trials, clinical development activities could be delayed or otherwise adversely affected
- 07the risk that participants enrolled in clinical trials will drop out of the trials before completion60% rewritten
- 08Analyses of preliminary or interim data from our clinical studies 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 data62% rewritten
- 09We therefore do not know whether any clinical trials we may conduct will demonstrate consistent or adequate efficacy and safety sufficient to obtain marketing approval to market our existing or future product candidatesNew
- 10our reputation may suffer
- 11Even if a product candidate does obtain regulatory approval, it may never achieve the market acceptance by physicians, patients, hospitals, third-party payors and others in the medical community that is necessary for commercial success and the market opportunity may be smaller than we estimate
- 12We 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 success27% rewritten
- 13If we or our collaborators 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 any product candidates if such product candidates are approved
- 14unforeseen costs and expenses associated with creating an independent sales and marketing organization
- 15If 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 risksNew
- 16our 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 costsNew
- 17We face substantial competition from other pharmaceutical and biotechnology companies and our operating results may suffer if we fail to compete effectively
- 18Even if we or our partners are able to commercialize our existing or future product candidates, the product may become subject to unfavorable pricing regulations, or third-party payor coverage and reimbursement policies that could harm our business81% rewritten
- 19We cannot predict whether bacteria may develop resistance to our product candidate, if approved, which could affect its revenue potential35% rewritten
- 20If we are not successful in developing and commercializing additional product candidates, our ability to expand our business and achieve our strategic objectives would be impaired
- 21Product liability lawsuits against us could divert our resources, cause us to incur substantial liabilities and limit commercialization of any products that we may develop
- 22the inability to commercialize any products that we may develop
- 23If 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 our business
- 24Our internal computer systems, or those of our contract research organizations or other contractors or consultants, may fail or suffer cybersecurity incidents, which could result in a material disruption of our product development programs, and could subject us to liability
- 25Our actual or perceived failure to comply with data protection laws and regulations could lead to government enforcement actions, private litigation and/or adverse publicity and could negatively affect our business
- 26We or third parties upon whom we depend may be adversely affected by natural disasters and/or health epidemics, and our business, financial condition and results of operations could be adversely affected
Risks Related to Our Financial Position and Need for Additional Capital
- 27We expect to continue to incur significant expenses and operating losses for the foreseeable future. If we are unable to achieve commercialization, revenue from product sales, and, ultimately, profitability, the market value of our common stock will likely decline
- 28acquire or in-license other product candidates and technologies35% rewritten
- 29If we are unable to raise capital when needed, or do not receive payments from our collaboration partnership agreements, it could limit our ability to support our operationsNew
- 30Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to any of our technologies or product candidates46% rewritten
- 31We have a limited operating history and no history of commercializing pharmaceutical products, which may make it difficult to evaluate the prospects for our future viability
- 32Our ability to use our net operating loss carryforwards may be limited57% rewritten
Risks Related to Our Dependence on Third Parties
- 33We may not achieve the milestones triggering payments to us in our existing, or any future, license and collaboration agreements with third parties
- 34collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further development or commercialization of the applicable product candidates
- 35We may have to alter our development and commercialization plans if we are not able to establish collaborations
- 36industry and market conditions generally
- 37the possible misappropriation of our proprietary information, including our trade secrets and know-how
- 38We are a party to agreements with Meiji and GSK for tebipenem HBr and we may enter into additional agreements, including license agreements, with other parties in the future that impose diligence, development and commercialization timelines, milestone payments, royalties, insurance and other obligations on usNew
Risks Related to Our Intellectual Property
- 39We may become involved in lawsuits to protect or enforce our patents or other intellectual property, which could be expensive, time consuming and unsuccessful
- 40If we are sued for infringing intellectual property rights of third parties, or otherwise become involved in disputes regarding our intellectual property rights, such litigation could be costly and time consuming and could prevent or delay us from developing or commercializing our existing or future product candidates
- 41We may be subject to claims that we or our employees, consultants or contractors have misappropriated the intellectual property of a third party, or claims asserting ownership of what we regard as our own intellectual property
- 42If we are unable to protect the confidentiality of our trade secrets, the value of our technology could be materially adversely affected and our business would be harmed
- 43We have registered trademarks and pending trademark applications. Failure to enforce our registered marks or secure registration of our pending trademark applications could adversely affect our business
Risks Related to Regulatory Approval and Other Legal Compliance Matters
- 44If we or our collaboration partners are not able to obtain, or if there are delays in obtaining, required regulatory approvals, we will not be able to commercialize our existing and future product candidates, and our ability to generate revenue will be materially impaired
- 45We have only limited experience in filing and supporting the applications necessary to gain marketing approvals and have relied on third-party contract research organizations to assist us in this process
- 46the potential for approval policies or regulations of the FDA or the applicable foreign regulatory agencies to significantly change in a manner rendering our clinical data insufficient for approval
- 47A fast track designation may not actually lead to a faster development or regulatory review or approval process51% rewritten
- 48Priority review designation by the FDA may not lead to a faster regulatory review or approval process and, in any event, does not assure FDA approval92% rewritten
- 49If approved for commercial marketing in the United States, our existing or future product candidates may face generic competition sooner than anticipated
- 50If we or our partners are unable to obtain marketing approval in international jurisdictions, we will not be able to market our existing or future product candidates abroad86% rewritten
- 51Since the United Kingdom left the EU prior to the date on which the EU CTR took effect, the U.K. legal framework did not benefit from the same revisions as occurred at EU levelNew
- 52issue injunctions or impose civil or criminal penalties
- 53Our relationships with customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings
- 54Recently enacted and future policies and legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize any of our product candidates and may affect the reimbursement made for any product candidate for which we receive marketing approval60% rewritten
- 55Changes in tax laws or in their implementation or interpretation could adversely affect our business and financial conditionNew
- 56If we successfully commercialize one of our product candidates, failure to comply with our reporting and payment obligations under U.S. governmental pricing programs could have a material adverse effect on our business, financial condition and results of operations
- 57Our employees, independent contractors, principal investigators, contract research organizations, consultants or vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements76% rewritten
- 58Changes in and uncertainty surrounding U.S. and international trade policies may adversely impact our business and operating resultsNew
- 59Neither the Supreme Court’s decision nor the Executive Order revoking the IEEPA tariffs addressed refunds, leaving the issue to renewed proceedings before the U.S. Court of International Trade, where importers may need to pursue administrative remedies and/or litigation amid continued uncertaintyNew
Risks Related to Employee Matters and Managing Growth
- 60Our future success depends on our ability to retain our key executives and to attract, retain and motivate qualified personnel31% rewritten
- 61We undertook internal restructuring activities that could result in disruptions to our business or otherwise materially harm our results of operations or financial conditionNew
- 62If foreign approvals are obtained, we will be subject to additional risks in conducting business in international markets
Risks Related to Our Common Stock
- 63The price of our common stock has been and, in the future, may continue to be volatile whether related or unrelated to our operations, which could result in a decline in value for our stockholders
- 64the other factors described in this “Risk Factors” section39% rewritten
- 65An active trading market for our common stock may not be sustained42% rewritten
- 66If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline88% rewritten
- 67We have broad discretion in the use of our cash reserves and may not use them effectively
- 68We are a smaller reporting company and the reduced disclosure requirements applicable to smaller reporting companies may make our common stock less attractive to investors
- 69We have incurred and will continue to incur increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance initiatives and corporate governance practices
- 70Failure to maintain effective internal controls in accordance with Section 404 of Sarbanes-Oxley in the future could have a material adverse effect on our ability to produce accurate financial statements and on our stock price
- 71A significant portion of our total outstanding shares may be sold into the market at any time, which could cause the market price of our common stock to decline significantly, even if our business is doing well
- 72We do not anticipate paying any cash dividends on our capital stock in the foreseeable future. Accordingly, stockholders must rely on capital appreciation, if any, for any return on their investment
- 73Provisions in our corporate charter documents 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
- 74require the approval of the holders of at least 75% of the votes that all of our stockholders would be entitled to cast to amend or repeal certain provisions of our Amended and Restated Certificate of Incorporation, as amended, or Amended and Restated Bylaws
- 75We may become involved in securities litigation that could divert management’s attention and harm our business, and insurance coverage may not be sufficient to cover all costs and damages47% rewritten
Other Spero Therapeutics 10-Ks
- FY2024 10-K risk factors81 risks
Spero Therapeutics relies heavily on the success, regulatory approval, and commercialization of its lead product candidate tebipenem HBr under a partnership with GSK.
Filed Mar 27, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.