Risk Factors Update Summary

• Business strategy now heavily relies on contingent milestone and royalty payments from Pfizer, Boston Pharmaceuticals, and Servier.
• Risks related to the development and commercialization of drug candidates: No active product candidates, potential termination of collaboration agreements, ongoing clinical trials, and potential delays in commercialization. This change might result in significant delays in revenue generation.
• Accumulated deficit increased from $290 million to $315 million, with net losses of $24.5 million in 2023.
• Risks related to regulatory approvals: AstraZeneca terminated collaboration agreements based on non-clinical safety findings, impacting potential milestones or royalties. This change might result in revenue loss and delays in commercialization.
• Losses anticipated to continue, with significant research and development expenses impacting financial condition.
• Risks related to clinical trials: AstraZeneca discontinued clinical studies due to safety findings, impacting the progression of drug candidates. This change might result in delays in clinical trial progress.
• Potential Nasdaq delisting due to failure to meet $1.00 per share bid price requirement.
• Risks related to intellectual property: Potential infringement of intellectual property rights by drug candidates, leading to commercialization limitations. This change might result in legal disputes and commercialization challenges.
• Reduction in workforce and discontinuation of R&D activities to extend cash runway into at least 2027.
• Risks related to personnel: Reduction in force impacting 70% of employees, with further reductions planned, affecting operations. This change might result in operational disruptions and workforce challenges.
• Dependence on successful development of partnered drug candidates for revenue generation.
• Potential impact of data protection laws on operations, with increased compliance complexity and risks.