A. [Reserved]
B. Capitalization and Indebtedness
Not applicable.
C. Reasons for the Offer and Use of Proceeds
Not applicable.
D. Risk Factors
Our business is subject to various risks, including those described below. You should consider carefully the risks
and uncertainties described below and in our future filings. If any such risks are realized, our business, financial
condition, results of operations and prospects could be materially and adversely affected. Additionally, risks and
uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely
affect our business, financial condition, results of operations and/or prospects.
Risk Factor Summary
–Our business is dependent on the successful development, regulatory approval and commercialization of new
medicinal product candidates based on our technology platforms, particularly our oncology assets including
BNT327 and our antibody-drug conjugate, or ADC, clinical assets. If we and our collaborators are unable to
obtain approval for and to effectively commercialize our product candidates for the treatment of patients in
their intended indications, our business would be significantly harmed.
–We are developing product candidates and services, including our oncology pipeline and ADC product
candidates, in an environment of rapid technological and scientific change, including evolving standards of
care, and our failure to effectively compete would prevent us from achieving significant market penetration.
Most of our competitors have significantly greater resources than we do and we may not be able to compete
successfully.
–Our product candidates may not work as intended, may cause undesirable effects or may have other
properties that could delay or prevent their regulatory approval, limit the commercial profile of an approved
label, or result in significant negative consequences following marketing approval, if any.
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–Clinical development involves a lengthy and expensive process with an uncertain outcome, and delays can
occur for a variety of reasons outside of our control. Clinical trials of our product candidates may be delayed,
and certain programs may never advance in the clinic or may be more costly to conduct than we anticipate,
and we may have difficulty recruiting patients to participate in clinical trials, any of which can affect our ability
to fund our company and would have a material adverse impact on our business.
–If we are not successful in discovering, developing and commercializing additional product candidates beyond
our current portfolio, our ability to expand our business and achieve our strategic objectives would be
impaired.
–Demand for our COVID-19 vaccine, though difficult to predict, is expected to continue to decrease in the near
future. Changing market dynamics, including as a result of government policy and public sentiment, will impact
our revenue, which currently depends heavily on sales of our COVID-19 vaccine, and result in challenges
relating to production of our COVID-19 vaccine.
–Our reported revenue is partially based on preliminary estimates of COVID-19 vaccine sales and costs from
Pfizer Inc., or Pfizer, that are likely to change in future periods, which may impact our reported financial
results.
–Other companies or organizations may challenge our intellectual property rights or may assert intellectual
property rights that prevent us from developing and commercializing our COVID-19 vaccine or our product
candidates and other technologies, or that negatively affect our results of operations.
–Even if we obtain regulatory approval for our product candidates, the products may not gain the market
acceptance among physicians, patients, hospitals, treatment centers and others in the medical community
necessary for commercial success.
–Our operating results may fluctuate significantly, which makes our future operating results difficult to predict. If
our operating results fall below expectations, the price of the ADSs representing our shares could decline.
–If we identify material weaknesses in our internal control over financial reporting and fail to remediate such
material weaknesses, we may not be able to report our financial results accurately or to prevent fraud.
–As a “foreign private issuer,” we are exempt from a number of rules under U.S. securities laws, as well as
Nasdaq rules, and we are permitted to file less information with the Securities and Exchange Commission, or
the SEC, than U.S. companies. This may limit the information available to holders of the ADSs and may make
our ordinary shares and the ADSs less attractive to investors.
–Our approved product and product candidates are based on novel technologies and they may be complex and
difficult to manufacture. We may encounter difficulties in manufacturing, product release, shelf life, testing,
storage, supply chain management or shipping. If we or any of the third-party manufacturers we work with
encounter such difficulties, our ability to supply materials for clinical trials or any approved product could be
delayed or stopped.
–If our efforts to obtain, maintain, protect, defend and/or enforce the intellectual property related to our
COVID-19 vaccine or our product candidates and technologies are not adequate, we may not be able to
compete effectively in our market.
–We have experienced and may continue to experience significant volatility in the market price of the ADSs
representing our ordinary shares.
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–Our principal shareholders and management own a significant percentage of our ordinary shares and will be
able to exert significant control over matters subject to shareholder approval.
Risks Related to our Business
Our business is dependent on the successful development, regulatory approval and commercialization
of new medicinal product candidates based on our technology platforms, particularly our oncology
assets including BNT327 and our antibody-drug conjugate, or ADC, clinical assets. If we and our
collaborators are unable to obtain approval for and to effectively commercialize our product candidates
for the treatment of patients in their intended indications, our business would be significantly harmed.
Even if we complete the necessary preclinical studies and clinical trials, the marketing approval process is
expensive, time-consuming and uncertain, and we may not be able to obtain full approvals, or may only obtain
partial approvals, in the requested indication for the commercialization of product candidates we may develop.
Any product candidates we may develop and the activities associated with their development and
commercialization, including design, testing, manufacture, recordkeeping, labeling, storage, approval,
advertising, promotion, sale and distribution, are subject to comprehensive regulation by the FDA and by
comparable global health authorities. To obtain the requisite regulatory approvals required to commercialize any
of our product candidates, we and our collaborators must demonstrate through extensive preclinical studies and
clinical trials that our product candidates are safe and effective for their intended use in the relevant target
population. Successful completion of clinical trials is a prerequisite to submitting a biologics license application,
or BLA, or a new drug application, or NDA, to the FDA, a Marketing Authorization Application, or MAA, to the
EMA, and similar marketing applications to comparable global regulatory authorities, for each product candidate
and, consequently, the ultimate approval and commercial marketing of any product candidates.
Failure to obtain marketing approval for a product candidate will prevent us from commercializing the product
candidate in a given jurisdiction. Although our COVID-19 vaccine has received emergency use authorization
and/or regulatory approvals in certain countries, it is possible that none of our other product candidates, or any
product candidates we may seek to develop in the future, will ever obtain regulatory approval. We have limited
experience in filing and supporting the applications necessary to gain marketing approvals and may need to rely
on third-party contract research organizations, or CROs, regulatory consultants or collaborators to assist us in
this process. We expect to submit initial BLAs/MAAs for our product candidates in the United States, the
European Union and in other countries globally. In some of these jurisdictions, mRNA-based medicinal products
may be classified in different ways and may be subject to specific requirements. Securing regulatory approval
requires the submission of extensive quality, preclinical and clinical data and supporting information to the
various regulatory authorities for each therapeutic indication to establish the product candidate’s safety and
efficacy. Securing regulatory approval also requires the submission of information about the product
manufacturing process to, and inspection of manufacturing facilities by, the relevant regulatory authority. Clinical
benefit and risk are regularly assessed during development, and any new medicinal product we develop may
turn out to be insufficiently, i.e., not clinically meaningfully, effective, or may prove to have unacceptable adverse
effects, or other characteristics that may preclude our obtaining marketing approval or prevent or limit
commercial use.
The process of obtaining marketing approvals in the United States, the European Union and elsewhere is
expensive, and if additional clinical trials are required, may take many years. Timing can vary substantially based
upon a variety of factors, including the type, complexity and novelty of the product candidates involved. Changes
in marketing approval policies and standards of care during the development period, changes in or the
enactment of additional statutes or regulations, or changes in regulatory review for each submitted product
application may cause delays in the approval or rejection of an application. The FDA, EMA and comparable
regulatory authorities in other countries have substantial discretion in the approval process and may refuse to
accept any application or may decide that the data are insufficient for approval and require additional preclinical,
clinical or other trials. In addition, varying interpretations of the data obtained from preclinical and clinical testing
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could delay, limit or prevent marketing approval of a product candidate. Any marketing approval we ultimately
obtain may be limited or subject to restrictions or post-approval commitments that render the approved product
not commercially viable. Additional delays or non-approval may result if an FDA panel of experts, referred to as
an Advisory Committee, or other regulatory authority recommends non-approval or restrictions on approval. For
example, the FDA’s approval of our LP.8.1-adapted monovalent COVID-19 vaccine is in a narrower population
than our previous variant-adapted vaccines. In addition, we may experience delays or rejections based upon
additional government regulation from future legislation or administrative action, or changes in regulatory agency
policy during the period of product development, clinical trials, and the review process. Officials appointed by the
U.S. presidential administration to oversee the agencies involved with approval of drugs and biologics may seek
to change regulatory requirements for approval or the approach to reviewing applications. Together with changes
of regulatory policy priorities and allocated resources, this could cause further delays, expense or non-approvals.
Regulatory agencies also may approve a product candidate for fewer or more limited indications or patient
populations than requested or may grant approval subject to the conduct of post-marketing studies. In addition,
regulatory agencies may not approve the labeling claims that are necessary or desirable for the successful
commercialization of our product candidates.
The FDA, EMA and other regulatory agencies review the Quality or Chemistry, Manufacturing and Controls, or
CMC, section of regulatory filings. Any aspects found unsatisfactory by regulatory agencies may result in delays
in clinical trials and commercialization. In addition, the regulatory agencies typically conduct pre-approval
inspections at the time of a BLA, MAA or comparable filing. Any findings by regulatory agencies and failure to
comply with requirements may lead to delay in approval and failure to commercialize the potential mRNA product
candidate.
If we experience delays in obtaining, or if we fail to obtain, approval of any product candidates we may develop,
the commercial prospects for those product candidates will be harmed, and our ability to generate revenues will
be materially impaired. Additionally, even if we are successful in obtaining marketing approval for product
candidates, because our preclinical studies and clinical trials have not been designed with specific
commercialization considerations, the commercial prospects for those product candidates could be harmed, and
our ability to generate revenues could be materially impaired.
We are developing product candidates and services, including our oncology pipeline and ADC product
candidates, in an environment of rapid technological and scientific change, including evolving standards
of care, and geopolitical uncertainties, and our failure to effectively compete would prevent us from
achieving significant market penetration. Most of our competitors have significantly greater resources
than we do and we may not be able to compete successfully.
The pharmaceutical market is intensely competitive and rapidly changing. Many large pharmaceutical and
biotechnology companies, academic institutions, governmental agencies, and other public and private research
organizations are pursuing the development of novel drugs for the same diseases that we are targeting or expect
to target. Many of our competitors have:
–greater financial, technical and human resources than we have at every stage of the discovery, development,
manufacture and commercialization of products;
–more extensive experience in preclinical testing, conducting clinical trials, obtaining regulatory approvals and
manufacturing, marketing and selling drug products;
–product candidates that are based on previously tested or accepted technologies;
–products that have been approved or are in late stages of development; and
–collaborative arrangements in our target markets with leading companies and research institutions.
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We will continue to face intense competition from products that have already been approved and accepted by
the medical community for the treatment of the conditions for which we may develop products in the future. We
also expect to face competition from new products that enter the market. There are a number of products
currently under development, which may become commercially available in the future, for the treatment of
conditions for which we are trying, or may in the future try, to develop drugs. These drugs may be more effective,
safer, less expensive, or marketed and sold more effectively than any products we develop.
We anticipate competing with the largest pharmaceutical companies in the world, many of which are currently
conducting research in the fields of infectious diseases, immuno-oncology, rare genetic diseases and cancer
immunotherapies. Some of these companies have greater financial and human resources than we currently
have. In addition to these large pharmaceutical companies, we may directly compete with fully-integrated
biopharmaceutical companies and other immunotherapy-focused oncology companies, as well as a number of
companies focused on immunotherapies or shared tumor antigen and neoantigen therapeutics, some of which
have entered into collaboration and funding agreements with larger pharmaceutical or biotechnology companies.
We also face competition from other companies and institutions that continue to invest in innovation in the ADC
field.
If we successfully develop other product candidates, and obtain approval for them, we will face competition
based on many different factors, including:
–the safety and effectiveness of our products relative to alternative therapies, if any;
–the ease with which our products can be administered and the extent to which patients accept relatively new
routes of administration;
–the timing and scope of regulatory approvals for these products;
–the availability and cost of manufacturing and commercialization capabilities;
–the price of any approved immunotherapy;
–reimbursement coverage; and
–intellectual property position.
Following our acquisition of InstaDeep Ltd., or InstaDeep, we also face competition in the rapidly growing and
developing artificial intelligence, or AI, industry. Our competitors may develop or commercialize products and
services with significant advantages over any products we develop based on any of the factors listed above or
on other factors. In addition, our competitors may develop collaborations with or receive funding from larger
pharmaceutical, biotechnology or technology companies, providing them with an advantage over us. Our
competitors therefore may be more successful in commercializing their products and services than we are, which
could adversely affect our competitive position and business. Competitive products and services may make any
products and services we develop obsolete or non-competitive before we can recover the expenses of
developing and commercializing such products, if approved, and services.
Our product candidates may not work as intended, may cause undesirable effects or may have other
properties that could delay or prevent their regulatory approval, limit the commercial profile of an
approved label, or result in significant negative consequences following marketing approval, if any.
As with most medicinal products, use of our product candidates could be associated with undesirable effects or
adverse events which can vary in severity from minor reactions to death and in frequency from infrequent to
prevalent. The potential for adverse events is especially acute in the oncology setting, where patients may have
advanced disease, impaired organ function, compromised immune and other systems and may be receiving
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numerous other therapies. Undesirable side effects or unacceptable toxicities caused by our product candidates
could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more
restrictive label or the delay or denial of regulatory approval by the FDA, the EMA or comparable regulatory
authorities. Results of our trials could reveal a high and unacceptable severity and prevalence of adverse
reactions that negatively affect the benefit/risk assessment .
If unacceptable side effects arise in the development of our product candidates, we, the FDA, competent
authorities of EU member states, ethics committees, the institutional review boards, or IRBs, at the institutions in
which our studies are conducted, or the Data Safety Monitoring Board, or DSMB, could suspend or terminate our
clinical trials. The FDA or comparable regulatory authorities could also order us to cease clinical trials or deny
approval of our product candidates for any or all targeted indications. Treatment-related side effects could also
affect patient recruitment or the ability of enrolled patients to complete any of our clinical trials or result in product
liability claims. In addition, these side effects may not be appropriately recognized or managed by the treating
medical staff. We are committed to training medical personnel using our product candidates to understand the
side effect profiles for our clinical trials, as well as providing guidance to prescribers upon any commercialization
of any of our product candidates. Inadequate training in recognizing or managing the potential side effects of our
product candidates could result in patient injury or death. Any of these occurrences may harm our business,
financial condition and prospects significantly.
Clinical trials are strictly regulated and monitored by sponsors, independent data and safety monitoring
boards, ethics committees, and regulatory agencies. Despite adequate risk minimization measures,
unexpected events may occur that could adversely impact patients’ safety and/or affect our ability to
obtain regulatory approvals and, if approved, commercialize our product candidates.
In our ongoing and planned clinical trials, we have contracted, and are expected to continue to contract, with
academic medical centers and hospitals experienced in the assessment and management of toxicities arising
during clinical trials. Nonetheless, these centers and hospitals may have difficulty observing patients and treating
toxicities, which may be more challenging due to personnel changes, inexperience, shift changes, house staff
coverage or related issues. This could lead to more severe or prolonged toxicities or even patient deaths, which
could result in us or the FDA, the EMA or other comparable regulatory authority delaying, suspending or
terminating one or more of our clinical trials, and which could jeopardize regulatory approval. The centers using
our products, if and when approved, could also have difficulty managing any adverse effects of our products, or
use medicines that do not adequately control such undesirable effects or that have a detrimental impact on the
efficacy of the treatment.
In addition, even if we successfully advance our product candidates into and through clinical trials, such trials will
likely only include a limited number of patients and limited duration of exposure to our product candidates. As a
result, we cannot be assured that adverse effects of our product candidates will not be uncovered when a
significantly larger number of patients are exposed to the product candidate. Further, any clinical trials may not
be sufficient to determine the effects and safety consequences of taking our product candidates over a multi-year
period.
If any of our product candidates receives marketing approval and we or others later identify undesirable effects
caused by such products, a number of potentially significant negative consequences could result, including:
–regulatory authorities may withdraw their approval of the product;
–we may be required to recall a product or change the way such product is administered to patients;
–additional restrictions may be imposed on the marketing of the particular product or the manufacturing
processes for the product or any component thereof;
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–regulatory authorities may require the addition of labeling statements, such as a “black box” warning or a
contraindication;
–we may be required to implement a Risk Evaluation and Mitigation Strategy, or REMS, or create a Medication
Guide outlining the risks of such side effects for distribution to patients;
–we could be sued and held liable for harm caused to patients;
–the product may become less competitive; and
–our reputation may be negatively impacted.
Any of the foregoing events could prevent us from achieving or maintaining market acceptance of the particular
product candidate, if approved, and result in the loss of significant revenues to us, which would materially and
adversely affect our results of operations and business. In addition, if one or more of our product candidates or
our immunotherapy approach generally prove to be unsafe, our technology platforms and pipeline could be
affected, which would have a material and adverse effect on our business, financial condition, results of
operations and prospects.
Preclinical development is uncertain. Our preclinical programs may experience delays or may never
advance to clinical trials, which would adversely affect our ability to obtain regulatory approvals or
commercialize these programs on a timely basis or at all and would have an adverse effect on our
business.
Much of our pipeline is in preclinical development and these programs could be delayed or not advance into the
clinic. Before we can initiate clinical trials for product candidates, we must complete extensive preclinical studies,
including IND-enabling Good Laboratory Practice toxicology testing, that support our planned Investigational
New Drug applications, or INDs, in the United States or similar applications in other jurisdictions. We must also
complete extensive work on CMC activities (including collecting yield, purity and stability data) to be included in
the IND filing. CMC activities for a new category of medicines such as mRNA therapies require extensive
manufacturing processes and analytical development, which are uncertain and lengthy. For instance, batch
failures have occurred as we scale up our manufacturing and may occur in the future. In addition, we have had
in the past, and may in the future have, difficulty identifying appropriate buffers and storage conditions to enable
sufficient shelf life of batches of our preclinical or clinical product candidates. If we are required to produce new
batches of our product candidates due to insufficient shelf life, it may delay the commencement or completion of
preclinical or clinical trials of such product candidates. For example, we cannot be certain of the timely
completion or outcome of our preclinical testing and studies and cannot predict if the FDA or other regulatory
authorities will accept the results of our preclinical testing or our proposed clinical programs or if the outcome of
our preclinical testing, studies and CMC activities will ultimately support the further development of our
programs. As a result, we cannot be sure that we will be able to submit INDs or similar applications for our
preclinical programs on the timelines we expect, if at all, and we cannot be sure that submission of INDs or
similar applications will result in the FDA or other regulatory authorities allowing clinical trials to begin.
Clinical development involves a lengthy and expensive process with an uncertain outcome, and delays
can occur for a variety of reasons outside of our control. Clinical trials of our product candidates may be
delayed, certain programs may never advance in the clinic or may be more costly to conduct than we
anticipate, and we may have difficulty recruiting patients to participate in clinical trials, any of which can
affect our ability to fund our company and would have a material adverse impact on our business.
Clinical testing is expensive and complex and can take many years to complete. Its outcome is inherently
uncertain. We may not be able to initiate, may experience delays in, or may have to discontinue clinical trials for
our product candidates. We and our collaborators also may experience numerous unforeseen events during, or
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as a result of, any clinical trials that we or our collaborators conduct that could delay or prevent us or our
collaborators from successfully developing our product candidates, including:
–the FDA, other regulators, IRBs or ethics committees may not authorize us or our investigators to commence
a clinical trial or conduct a clinical trial at a prospective trial site for any number of reasons, including concerns
regarding safety and aspects of the clinical trial design;
–we may experience delays in reaching, or fail to reach, agreement on favorable terms with prospective trial
sites and prospective CROs, the terms of which can be subject to extensive negotiation and may vary
significantly among different CROs and trial sites;
–we have optimized in the past and may in the future optimize our manufacturing processes, including through
changes to the scale and site of manufacturing, which may lead to additional studies (including bridging and
bioequivalence studies) or potentially significant changes in our clinical trial designs, requiring additional cost
and time, and, as a consequence, lead to a delay in plans for progressing one or more product candidates;
–the outcome of our preclinical studies and our early clinical trials may not be predictive of the success of later
clinical trials, and interim results of a clinical trial do not necessarily predict final results;
–we may be unable to establish clinical endpoints that applicable regulatory authorities would consider clinically
meaningful;
–in an effort to optimize product features, we have made in the past and may continue to make changes to our
product candidates after we commence clinical trials of a medicine which may require us to repeat earlier
stages of clinical testing or delay later-stage testing of the medicine;
–clinical trials of any product candidates may fail to show safety or efficacy, or may produce negative or
inconclusive results, and we may decide, or regulators may require us, to conduct additional nonclinical
studies or clinical trials, or we may decide to abandon product development programs;
–differences in trial design between early-stage clinical trials and later-stage clinical trials may make it difficult
to extrapolate the results of earlier clinical trials to later clinical trials;
–preclinical and clinical data are often susceptible to varying interpretations and analyses, and many product
candidates believed to have performed satisfactorily in preclinical studies and clinical trials have nonetheless
failed to obtain marketing approval;
–our product candidates may have undesirable effects or other unexpected characteristics. One or more of
such effects or events could cause regulators to impose a clinical hold on the applicable trial, or cause us or
our investigators, IRBs or ethics committees to suspend or terminate the trial of that product candidate or any
other of our product candidates for which a clinical trial may be ongoing;
–the number of trial participants required for clinical trials of any product candidates may be larger than we
anticipate, identification of trial participants for such trials may be limited, enrollment in these clinical trials may
be slower than we anticipate due to perceived adverse effects, limited patient populations, competitive trials,
or other reasons, or participants may withdraw from clinical trials or fail to return for post-treatment follow-up at
a higher rate than we anticipate;
–despite robust sponsor oversight, our and our collaborators’ third-party contractors may fail to comply with
regulatory requirements or meet their contractual obligations in a timely manner, or at all, or may deviate from
the clinical trial protocol or withdraw from the trial, which may require the addition of new clinical trial sites;
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–regulators may elect to impose a clinical hold, or we, our investigators, IRBs or ethics committees may elect to
suspend or terminate clinical research or trials for various reasons, including noncompliance with regulatory
requirements or a finding that the participants are being exposed to an unacceptable benefit-risk ratio;
–with respect to infectious disease vaccine trials in particular, we have to wait for a particular level of infection in
the placebo arm in order to assess protection provided by vaccine, and we cannot control the rate of exposure
or infection which can make timing uncertain;
–patient characteristics, the rate of disease progression, and other external influences beyond our control can
make the timing of analysis uncertain, particularly in the case of later-stage oncology trials;
–the cost of preclinical or nonclinical testing and studies and clinical trials of any product candidates may be
greater than we anticipate;
–the supply or quality of our product candidates or other materials necessary to conduct clinical trials may be
insufficient or inadequate;
–safety or efficacy concerns regarding our product candidates may result from any concerns arising from
nonclinical or clinical testing of other therapies targeting a similar disease state or other therapies, such as
gene therapy, that are perceived as similar to ours; and
–the FDA or other regulatory authorities may require us to submit additional data, such as long-term toxicology
studies, or impose other requirements before permitting us to initiate a clinical trial.
We could also encounter delays if a clinical trial is suspended or placed on hold by us, the FDA, or other
regulatory authorities, ethics committees, or the IRBs of the institutions in which such trials are being conducted,
or if such trial is recommended for suspension or termination by the DSMB. In the event a trial is suspended or
placed on hold, it may, upon further analysis, be terminated altogether. If a pivotal trial is terminated, the relevant
program may also be subject to delays or termination. We may in the future be delayed in gaining clearance
from the FDA or other regulators to initiate clinical trials through, among other things, the imposition of a clinical
hold in order to address comments from such regulators on our clinical trial design or other elements of our
clinical trials. A suspension or termination may be imposed due to a number of factors, including failure to
conduct the clinical trial in accordance with regulatory requirements or our clinical protocols; inspection of the
clinical trial operations or trial site by the FDA or other regulatory authorities resulting in the imposition of a
clinical hold; unforeseen safety issues or adverse side effects; failure to demonstrate a benefit, or adequate
benefit-risk ratio, from using a product candidate; failure to establish or achieve clinically meaningful trial
endpoints; changes in governmental regulations or administrative actions; or lack of adequate funding to
continue the clinical trial. Many of the factors that cause or lead to a delay in the commencement or completion
of clinical trials may also ultimately lead to the denial of regulatory approval of our product candidates. We could
also experience delays if physicians encounter unresolved ethical issues associated with enrolling patients in
clinical trials of our product candidates in lieu of prescribing existing treatments that have established safety and
efficacy profiles.
We expect the novel nature of our product candidates to create further challenges in obtaining regulatory
approval. For example, the FDA and regulatory authorities in other jurisdictions have limited experience with
commercial development of several of our technologies. The FDA may require an Advisory Committee to
deliberate on the adequacy of the safety and efficacy data to support licensure. The opinion of the Advisory
Committee, although not binding, may have a significant impact on our ability to obtain licensure of the product
candidates based on the completed clinical trials, as the FDA often adheres to the Advisory Committee’s
recommendations. Accordingly, the regulatory approval pathway for our product candidates may be uncertain,
complex, expensive and lengthy, and approval may not be certain.
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We must also complete extensive work on CMC activities that require extensive manufacturing processes and
analytical development, which are uncertain and lengthy. The FDA and other regulatory authorities have
indicated that, prior to commencing later stage clinical trials for our mRNA-based product candidates, we will
need to scale up and further refine assays to measure and predict the potency of a given dose of these product
candidates. Any delay in the scaling and refining of assays that are acceptable to the FDA or other regulatory
authorities could delay the start of future clinical trials. Further, the FDA or other regulatory authorities may
disagree with our clinical trial design and our interpretation of data for our clinical trials or may change the
requirements for approval even after they have reviewed and commented on the design for our clinical trials.
Significant additional preclinical or nonclinical testing and studies or clinical trial delays for our product
candidates also could allow our competitors to bring products to market before we do, potentially impairing our
ability to successfully commercialize our product candidates and harming our business and results of operations.
Any delays in the development, or the suspension of development, of our product candidates may harm our
business, financial condition and prospects significantly.
In addition, on June 28, 2024, the Supreme Court overturned the Chevron doctrine in the combined cases of
Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce. The Chevron doctrine
gave deference to regulatory agencies in litigation against the FDA and other agencies. In addition, the Supreme
Court decided Corner Post, Inc. v. Board of Governors of the Federal Reserve System, which lengthened the
time in which some challenges to agency rules can be initiated. As a result of these cases, more plaintiffs may
bring lawsuits against the FDA to challenge longstanding decisions and policies of the FDA, which could
undermine the FDA’s authority, lead to uncertainties in the industry, and disrupt the FDA’s normal operations,
which could delay the FDA’s review of our marketing applications.
If we or our collaborators encounter difficulties enrolling participants in our clinical trials, our clinical
development activities could be delayed or otherwise adversely affected.
We depend on enrollment of participants in our clinical trials for our product candidates. In the past, our
collaborators have found, and we or our collaborators may in the future find, it difficult to enroll trial participants in
our clinical studies, which could delay or prevent clinical studies of our product candidates. Identifying and
qualifying trial participants to participate in clinical studies of our product candidates is critical to our success.
The timing of our clinical studies depends on the speed at which we can recruit trial participants to participate in
testing our product candidates. Delays in enrollment may result in increased costs or may affect the timing or
outcome of the planned clinical trials, which could prevent completion of these trials and adversely affect our
ability to advance the development of our product candidates. If trial participants are unwilling to participate in
our studies because of negative publicity from adverse events in our trials or other trials of similar products, or
those related to a specific therapeutic area, or for other reasons, including competitive clinical studies for similar
patient populations, the timeline for recruiting trial participants, conducting studies, and obtaining regulatory
approval of potential products may be delayed. These delays could result in increased costs, delays in
advancing our product development, delays in testing the effectiveness of our product, or termination of the
clinical studies altogether.
We may not be able to identify, recruit and enroll a sufficient number of trial participants, or those with required or
desired characteristics to achieve diversity in a study, to complete our clinical trials in a timely manner. Patient
and subject enrollment is affected by factors including:
–severity of the disease under investigation;
–complexity and design of the study protocol;
–size of the patient population;
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–eligibility criteria for the study in question;
–proximity and availability of clinical study sites for prospective trial participants;
–availability of competing therapies and clinical trials, including between our own clinical trials;
–efforts to facilitate timely enrollment in clinical trials;
–patient referral practices of physicians;
–ability to monitor trial participants adequately during and after treatment;
–ability to recruit clinical trial investigators with the appropriate competencies and experience;
–clinicians’ and trial participants’ perceptions of the potential advantages and side effects of the product
candidate being studied in relation to other available therapies, including any new drugs or treatments that
may be approved for the indications we are investigating;
–our ability to obtain and maintain participant informed consent;
–major changes in the approval status of competitor investigational products during the clinical trial period; and
–the risk that trial participants enrolled in clinical trials will not complete a clinical trial.
In addition, our clinical trials may compete with other clinical trials for product candidates that are in the same
therapeutic areas as our product candidates, and this competition will reduce the number and types of trial
participants available to us because some trial participants who might have opted to enroll in our trials may
instead opt to enroll in a trial being conducted by a third party. Since the number of qualified clinical investigators
is limited, we expect to conduct some of our clinical trials at the same clinical trial sites that some of our
competitors use, which will reduce the number of trial participants who are available for our clinical trials at such
clinical trial sites. Moreover, because in some cases our product candidates represent a therapeutic novelty in
contrast to more traditional methods for disease treatment and prevention, potential trial participants and their
doctors may be inclined to use conventional therapies or other investigational therapies rather than enroll trial
participants in any future clinical trial involving more novel product candidates. Additionally, if new product
candidates, such as gene editing therapies, show encouraging results, potential trial participants and their
doctors may be inclined to enroll trial participants in clinical trials using those product candidates. If such new
product candidates show discouraging results or other adverse safety indications, potential trial participants and
their doctors may be less inclined to enroll trial participants in our clinical trials.
In particular, certain conditions for which we plan to evaluate our current product candidates are rare diseases
with limited patient pools from which to draw for clinical trials. The eligibility criteria of our clinical trials will further
limit the pool of available trial participants. Additionally, the process of finding and diagnosing patients may prove
costly.
We, our collaborators, and other third parties on whom we rely conduct various activities, including
research, clinical trials, manufacturing and, where approved, marketing, in jurisdictions across the
globe. Such activities are subject to a variety of risks which could materially and adversely affect our
business.
Our activities increasingly span different jurisdictions. For example, clinical trials of our product candidates are
currently being conducted in several countries, and we plan to commercialize our product candidates, if
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approved, globally. Accordingly, we are subject to additional risks related to operating in multiple countries,
including:
–differing regulatory requirements in such countries;
–differences in the standard of care across jurisdictions, which complicates the choice of adequate comparator
therapies in global trials;
–unexpected changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements;
–increased difficulties in managing the logistics and transportation of storing and shipping product candidates
produced in Germany and shipping the product candidate to the patient abroad;
–import and export requirements and restrictions;
–restrictions on transfers of information, including certain technologies and personal data;
–economic weakness, including inflation, or changes to the political climate, public sentiment, and government
policy preferences in certain economies and markets;
–compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;
–taxes, including withholding of payroll taxes;
–currency fluctuations, which could result in increased operating expenses and reduced revenue, and other
obligations incident to doing business in another country;
–difficulties staffing and managing operations outside of Germany;
–workforce uncertainty in countries where labor unrest is more common;
–differing payor reimbursement regimes, governmental payors or patient self-pay systems, and price controls;
–potential liability under the U.S. Foreign Corrupt Practices Act of 1977 or comparable regulations in other
jurisdictions;
–challenges enforcing our contractual and intellectual property rights, especially in those countries that do not
respect and protect intellectual property rights to the same extent as Germany and the United States;
–production shortages resulting from any events affecting raw material supply or manufacturing capabilities
abroad; and
–business interruptions resulting from geopolitical actions, including war and terrorism, or public health
epidemics or pandemics.
As part of our global operations, we and our collaborators rely on relationships with entities based in various
jurisdictions, including for clinical research and manufacturing activities and other regional operational needs.
Such relationships may involve the use of our or others’ intellectual property. We expect to continue to rely on
such entities, which include locally-based contract manufacturing organizations, or CMOs, and CROs, in the
future. For example, we and our collaborators rely on WuXi Biologics Co., Ltd. and its affiliates for outsourcing
activities related to manufacturing and the supply chain, research and development, certain IP, and
commercialization readiness for certain of our product candidates. Such entities are subject to evolving local
regulatory requirements, and may also be subject to U.S. and EU legislation, including the recently enacted U.S.
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BIOSECURE Act, sanctions, trade restrictions, and/or other regulations. Such requirements could increase the
cost or reduce the supply of material available to us, delay or restrict the procurement or supply of such material,
or have an adverse affect on our ability to secure significant commitments from governments to purchase our
potential therapies.
Further, governments may turn, and have turned, to trade barriers to protect their domestic industries against
foreign imports, thereby increasing our cost to operate globally. If significant tariffs or other restrictions are
imposed on imports by the United States and related countermeasures are taken by impacted countries, our
business, including operating results, cash flows, and financial condition, may be adversely affected. Recently,
trade and tariff policies among the United States and other countries have been unsettled and are subject to
frequent changes. The U.S. government has imposed tariffs and other trade restrictions on goods across a range
of industries, and such actions have at times prompted retaliatory measures by affected countries such as
China, Canada and the European Union. While tariffs with certain countries have been temporarily reduced or
paused, the imposition of new tariffs will likely be met with further reciprocal tariffs, thus increasing the possibility
of a global trade war. If further tariffs are imposed on a broader range of imports, or if retaliatory trade measures
are enacted by affected countries, these factors could significantly increase the cost to our global clinical
research and manufacturing activities, adversely affect the commercial sale of our COVID-19 vaccines, and
harm our competitive position in key markets. Additionally, ongoing trade tensions and uncertainty regarding
future trade policies could negatively impact global economic conditions and consumer confidence, further
affecting our global operations.
As noted above, we and our partners have conducted and are expecting in the future to conduct clinical trials for
our product candidates at clinical sites located outside of the United States. Although the FDA may accept data
from clinical trials outside the United States that are not conducted under an IND, acceptance of this data in
support of a marketing application or IND requires the clinical trial to have been conducted in accordance with
GCPs, and that the FDA is able to validate the data from the clinical trial through an onsite inspection if it deems
such inspection necessary. Where data from non-U.S. clinical trials are intended to serve as the sole basis for
marketing approval in the United States, the FDA will not approve the application on the basis of non-U.S. data
alone unless those data are considered applicable to the U.S. patient population and U.S. medical practice, the
clinical trials were performed by clinical investigators of recognized competence, and the data is considered valid
without the need for an onsite inspection by the FDA or, if the FDA considers such an inspection to be necessary,
the FDA is able to validate the data through an onsite inspection or other appropriate means. There can be no
assurance the FDA will accept data from clinical trials conducted outside of the United States in support of a
marketing application. If the FDA does not accept data from our clinical trials of our product candidates, it would
likely result in the need for additional clinical trials, which would be costly and time-consuming and delay or
permanently halt our development of a product candidate.
These and other risks associated with our international operations and our collaborations with our collaborators
may materially adversely affect our ability to attain or maintain profitable operations.
Interim top-line and preliminary data from studies or trials that we announce or publish from time to time
may change as more data become available and are subject to audit and verification procedures that
could result in material changes in the final data.
From time to time, we may publish interim top-line or preliminary data from preclinical studies or clinical trials.
Interim data are subject to the risk that one or more of the outcomes may materially change as more data
become available. We also make assumptions, estimations, calculations and conclusions as part of our analyses
of data, and we may not have received or had the opportunity to fully evaluate all data. As a result, the top-line
results that we report may differ from future results of the same studies, or different conclusions or
considerations may qualify such results, once additional data have been received and fully evaluated.
Preliminary or top-line data also remain subject to audit and verification procedures that may result in the final
data being materially different from the preliminary data we previously published. As a result, interim and
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preliminary data should be viewed with caution until the final data are available. Additionally, interim data from
clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may
materially change as patient enrollment continues and more patient data become available. Adverse differences
between preliminary or interim data and final data could significantly harm our business prospects.
Further, others, including regulatory agencies, may not accept or agree with our assumptions, estimates,
calculations, conclusions or analyses or may interpret or weigh the importance of data differently, which could
impact the value of the particular program, the approvability or commercialization of the particular product
candidate or product and our company in general. In addition, the information we choose to disclose publicly
regarding a particular study or clinical trial is based on what is typically extensive information, and our
securityholders may not agree with what we determine is the material or otherwise appropriate information to
include in our disclosure. Any information we determine not to disclose may ultimately be deemed significant by
our securityholders or others with respect to future decisions, conclusions, views, activities or otherwise
regarding a particular product candidate or our business. If the top-line data that we report differ from actual
results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain
approval for, and commercialize, product candidates may be harmed, which could significantly harm our
business prospects.
Results of earlier studies and trials of our product candidates may not be predictive of future trial
results.
Success in preclinical studies and early clinical trials does not ensure that later clinical trials will be successful. A
number of companies in the biotechnology and pharmaceutical industries have suffered significant setbacks in
clinical trials, even after positive results in earlier preclinical studies or clinical trials. These setbacks have been
caused by, among other things, preclinical findings made while clinical trials were underway and safety or
efficacy observations made in clinical trials, including previously unreported adverse events. Notwithstanding any
potential promising results in earlier studies and trials, we cannot be certain that we will not face similar
setbacks. Even if our clinical trials are completed, the results may not be sufficient to obtain regulatory approval
for our product candidates. In addition, the results of our preclinical studies may not be predictive of the results of
outcomes in human clinical trials. For example, our tumor-specific cancer immunotherapy candidates and any
future product candidates may demonstrate different chemical, biological and pharmacological properties in
patients than they do in laboratory studies or may interact with human biological systems in unforeseen or
harmful ways. Product candidates in later stages of clinical trials may fail to show the desired pharmacological
properties or safety and efficacy traits despite having progressed through preclinical studies and initial clinical
trials. Even if we are able to initiate and complete clinical trials, the results may not be sufficient to obtain
regulatory approval for our product candidates.
Our planned clinical trials or those of our collaborators may be less efficacious or may reveal significant
adverse events not seen in our preclinical or nonclinical studies and may result in a safety profile that
could delay or terminate clinical trials, or delay or prevent regulatory approval or market acceptance of
any of our product candidates.
There is typically an extremely high rate of attrition for product candidates across categories of medicines
proceeding through clinical trials.
These product candidates may fail to show the desired safety and efficacy profile in later stages of clinical trials
despite having progressed through nonclinical studies and initial clinical trials. A number of companies in the
biopharmaceutical industry have suffered significant setbacks in later-stage clinical trials due to lack of efficacy
or unacceptable safety profiles, notwithstanding promising results in earlier trials. Most product candidates that
commence clinical trials are never approved as products and there can be no assurance that any of our current
or future clinical trials will ultimately be successful or support further clinical development of any of our product
candidates.
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Many of our product candidates are being developed or are intended to be co-administered with other
developmental therapies or approved medicines. For example, autogene cevumeran (BNT122/RO7198457) is
being developed to be co-administered with checkpoint inhibitors. Such combinations may have additional side
effects, which may be difficult to predict in future clinical trials.
If significant adverse events or other side effects are observed in any of our current or future clinical trials, we
may have difficulty recruiting trial participants to any of our clinical trials, trial participants may withdraw from
trials, or we may be required to abandon the trials or our development efforts of one or more product candidates
altogether. We, the FDA or other regulatory authorities, ethics committees or an IRB may impose a clinical hold
on, or suspend or terminate, clinical trials of a product candidate at any time for various reasons, including a
belief that participants in such trials are being exposed to unacceptable health risks or adverse side effects.
Some potential therapeutics developed in the biotechnology industry that initially showed therapeutic promise in
early-stage trials have later been found to cause side effects that prevented their further development. Even if
the side effects do not preclude the drug from obtaining or maintaining marketing approval, an unfavorable
benefit-risk ratio may inhibit market acceptance of the approved product due to its tolerability versus other
therapies. Any of these developments could materially harm our business, financial condition and prospects.
If we are not successful in discovering, developing and commercializing additional product candidates
beyond our current portfolio, our ability to expand our business and achieve our strategic objectives
would be impaired.
Although a substantial amount of our efforts focus on the clinical trials and potential approval of our existing
product candidates, a key element of our strategy is to discover, develop and potentially commercialize
additional products beyond our current portfolio to treat various conditions and in a variety of therapeutic areas.
We intend to do so by investing in our own drug and target discovery efforts, exploring potential collaborations
for the development of new products, and in-licensing technologies. Identifying new product candidates requires
substantial technical, financial and human resources, whether or not any product candidates are ultimately
identified. Even if we identify product candidates that initially show promise, we may fail to develop and
commercialize such products successfully for many reasons, including the following:
–the research methodology used may not be successful in identifying potential product candidates;
–competitors may develop alternatives that render our product candidates obsolete;
–product candidates we develop may nevertheless be covered by third parties’ patents or other exclusive
rights;
–a product candidate may, on further study, be shown to have harmful side effects or other characteristics that
indicate it is unlikely to be effective or otherwise does not meet applicable regulatory criteria;
–we may discontinue the development of a product candidate;
–a product candidate may not be capable of being produced in commercial quantities at an acceptable cost, or
at all; and
–an approved product may not be accepted as safe and effective by trial participants, the medical community or
third-party payors.
If we are unsuccessful in identifying and developing additional products, our potential for growth may be
impaired.
mRNA drug development carries substantial clinical development and regulatory risks due to limited
regulatory experience with mRNA immunotherapies.
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To our knowledge, other than our, Moderna, Inc.’s and Arcturus Therapeutics’ vaccines, no mRNA
immunotherapies have been approved or received emergency use authorization or conditional marketing
authorization to date by the FDA or the EMA. Successful discovery and development of mRNA-based (and
other) immunotherapies by either us or our collaborators is highly uncertain and depends on numerous factors,
many of which are beyond our or their control. Our product candidates that appear promising in the early phases
of development may fail to advance, experience delays in the clinic or clinical holds, or fail to reach the market
for many reasons, including:
–discovery efforts aimed at identifying potential immunotherapies may not be successful;
–nonclinical or preclinical study results may show product candidates to be less effective than desired or have
harmful or problematic side effects;
–clinical trial results may show the product candidates to be less effective than expected, including a failure to
meet one or more endpoints or have unacceptable side effects or toxicities;
–manufacturing or distribution failures or insufficient supply of GMP materials for clinical trials or higher than
expected cost could delay or set back clinical trials, or make our product candidates commercially
unattractive;
–our improvements in the manufacturing processes may not be sufficient to satisfy the clinical or commercial
demand of our product candidates or regulatory requirements for clinical trials;
–changes that we make to optimize our manufacturing, testing or formulating of GMP materials could impact
the safety, tolerability and efficacy of our product candidates;
–pricing or reimbursement issues or other factors could delay clinical trials or make any immunotherapy
uneconomical or noncompetitive with other therapies;
–changing social and political preferences regarding vaccines and mRNA therapies;
–the failure to timely advance our programs or receive the necessary regulatory approvals, or a delay in
receiving such approvals, due to, among other reasons, slow or failure to complete enrollment in clinical trials,
withdrawal by trial participants from trials, failure to achieve trial endpoints, additional time requirements for
data analysis, data integrity issues, BLA, MAA or the equivalent application, discussions with the FDA or the
EMA, a regulatory request for additional nonclinical or clinical data, or safety formulation or manufacturing
issues may lead to our inability to obtain sufficient funding; and
–the proprietary rights, products and technologies of our competitors may prevent our immunotherapies from
being commercialized.
For administrative purposes, some mRNA products may be classified together with gene therapy products by the
FDA or other regulatory agencies. Unlike certain gene therapies that irreversibly alter cell DNA and may be
subsequently subject to specific safety concerns, mRNA products are not designed to localize to the cell nucleus
or interact with the genome. Side effects observed in other gene therapies, however, could negatively impact the
perception of immunotherapies despite the differences in mechanism. In addition, unclear or inconsistent
regulatory classification of mRNA products may result in uncertainties regarding the regulatory requirements and
pathways for marketing approval. On the other hand, mRNA-based vaccines for the prevention of infectious
diseases, like our COVID-19 vaccine, are not currently classified as gene therapies in most regions. The
regulatory pathway for an individualized therapy, such as our Individualized Neoantigen Specific Immunotherapy,
or iNeST, an mRNA-based immunotherapy where each patient receives a different combination of mRNAs,
remains undetermined. The number and design of the clinical and preclinical studies required for the approval of
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these types of medicines have not been established, may be different from those required for advanced
medicinal therapy products or therapies that are not individualized or may require safety testing like gene
therapy products. Moreover, the length of time necessary to complete clinical trials and submit an application for
marketing approval by a regulatory authority varies significantly from one pharmaceutical product to the next and
may be difficult to predict.
Our future success depends on our ability to retain key employees, consultants and advisors and to
attract, retain and motivate qualified senior management and scientific personnel.
Our ability to compete in the highly competitive biotechnology and pharmaceutical industries depends upon our
ability to attract and retain highly qualified managerial, scientific and medical personnel. We are highly
dependent upon members of our management and scientific teams. We may not be able to retain these persons
due to the competitive environment in the biotechnology industry, as well as a current global shortage of these
highly qualified individuals. The loss of any of these persons’ services may adversely impact the achievement of
our research, development, financing and commercialization objectives. We are also aware of physical threats
made against certain of these people. In response to these threats, we have deployed personal protection for
such individuals and increased our security generally. We currently do not have “key person” insurance on any of
our employees.
In addition, we rely on consultants, contractors and advisors, including scientific and clinical advisors, to assist
us in formulating our research and development, regulatory approval and commercialization strategy. Our
consultants and advisors may be employed by employers other than us and may have commitments under
consulting or advisory contracts with other entities that may limit their availability to us. The loss of the services
of one or more of our current employees or advisors might impede the achievement of our research,
development, regulatory approval and commercialization objectives. In addition, we have flexibly grown our
workforce through the use of contractors and part-time workers. We may not be able to retain the services of
such personnel, which might result in delays in the operation of our business.
Recruiting and retaining other qualified employees, consultants and advisors for our business, including scientific
and technical personnel, will be critical to our success as well. Competition for skilled personnel, including in
mRNA research, clinical development, clinical operations, regulatory affairs, therapeutic area management,
manufacturing, and AI, is intense and the turnover rate can be high. We may not be able to attract and retain
personnel on favorable terms given the competition among numerous pharmaceutical and biotechnology
companies and academic institutions for individuals with similar skill sets. In addition, adverse publicity, and the
failure to succeed in preclinical studies or clinical trials or in applications for marketing approval may make it
more challenging to recruit and retain qualified personnel. The inability to recruit or loss of services of certain
executives, key employees, consultants or advisors may impede the progress of our research, development and
commercialization objectives and have a material adverse impact on our business, financial condition, results of
operations and prospects.
Our employees, principal investigators and consultants may engage in misconduct or other improper
activities, including non-compliance with regulatory standards and requirements and insider trading,
which could have an adverse effect on the results of our operations.
We are exposed to the risk of fraud or other misconduct by our employees, principal investigators and
consultants, despite our robust efforts to prevent such misconduct through sponsor oversight. Misconduct by
these parties could include intentional failures to comply with FDA regulations or the regulations applicable in the
European Union and other jurisdictions, to provide accurate information to the FDA, the EMA and other
regulatory authorities, to comply with healthcare fraud and abuse laws and regulations in the United States and
abroad, to report financial information or data accurately or to disclose unauthorized activities to us. Such
misconduct also could involve the improper use of information obtained in the course of clinical trials or
interactions with the FDA or other regulatory authorities, which could result in regulatory sanctions and cause
serious harm to our reputation. We have adopted a code of conduct applicable to all of our employees, but it is
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not always possible to identify and deter employee misconduct, and the precautions we take to detect and
prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us
from government investigations or other actions or lawsuits stemming from a failure to comply with laws or
regulations. If any such actions are instituted against us and we are not successful in defending ourselves or
asserting our rights, those actions could have a significant impact on our business, financial condition, results of
operations and prospects, including the imposition of significant fines or other sanctions.
Employment-related disputes, including employee litigation and unfavorable publicity, could negatively
affect our future business.
From time to time we may be subject to claims by our employees or regulatory authorities with respect to
employment and workplace matters, including lawsuits or proceedings against us regarding injury, creating a
hostile workplace, discrimination, wage and hour disputes, sexual harassment or other employment issues. In
recent years, there has been an increase in the number of discrimination and harassment claims generally.
Coupled with the expansion of social media platforms and similar devices that allow individuals access to a
broad audience, these claims have had a significant negative impact on some businesses. Certain companies
that have faced employment- or harassment- related lawsuits have had to terminate management or other key
personnel, and have suffered reputational harm that has negatively impacted their business. If we were to face
any employment-related claims, our business could be negatively affected.
The illegal distribution and sale by third parties of counterfeit versions of our COVID-19 vaccine, or, if
approved, our other product candidates, could have a negative impact on our financial performance or
reputation.
Third parties have in the past and may continue to illegally distribute and sell counterfeit versions of COVID-19
vaccines. Counterfeit products are frequently unsafe or ineffective, and may even be life-threatening. Counterfeit
medicines may contain harmful substances or the wrong dosage. However, to distributors and users, counterfeit
products may be visually indistinguishable from the authentic version.
Reports of adverse reactions to counterfeit products, increased levels of counterfeiting, or unsafe vaccines could
materially affect public confidence in our COVID-19 vaccine or other product candidates. It is possible that
adverse events caused by unsafe counterfeit vaccines will mistakenly be attributed to our COVID-19 vaccine, or,
if approved, our other product candidates. In addition, thefts of inventory at warehouses, plants or while in-
transit, which are subsequently improperly stored and which are sold through unauthorized channels, could
adversely impact patient safety, our reputation, and our business. Public loss of confidence in the integrity of our
COVID-19 vaccine or, if approved, our other product candidates, as a result of counterfeiting or theft could have
a material adverse effect on our business, results of operations, and financial condition.
We and our collaborators or other contractors or consultants depend on information technology
systems, and any failure of these systems could harm our business. Security breaches, loss of data and
other disruptions could compromise sensitive information related to our business or prevent us from
accessing critical information and expose us to liability, which could adversely affect our business,
results of operations and financial condition.
Our internal computer systems and those of our current and any future collaborators, vendors, and other
contractors or consultants are vulnerable to damage from computer viruses, unauthorized access, natural
disasters, terrorism, cybersecurity threats, war, and telecommunication and electrical failures. If any such
material system failure, accident or security breach were to occur and cause interruptions in our operations, it
could result in a material disruption of our development programs and our business operations, whether due to a
loss of our trade secrets or other proprietary information or other similar disruptions. For example, the loss of
clinical trial data from one or more ongoing or completed or future clinical trials could result in delays in our
regulatory approval efforts and significantly increase our costs to recover or reproduce the data. In addition,
because of our approach of running multiple clinical trials in parallel, any breach of our computer systems may
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result in a loss of data or compromised data integrity across many of our programs in many stages of
development. Any such breach, loss or compromise of clinical trial participant personal data may also subject us
to civil fines and penalties, including under the EU General Data Protection Regulation, or the GDPR, relevant
law of an EU member state, HIPAA, and other relevant state and federal privacy laws in the United States or in
other jurisdictions. To the extent that any disruption or security breach were to result in a loss of, or damage to,
data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability,
our competitive position could be harmed, and the further development and commercialization of our product
candidates could be delayed.
While we have not experienced any material system failures, accidents or security breaches to date, in
December 2020, we were informed by the EMA that the agency was subject to a cyberattack and that some
documents relating to our regulatory submission for our COVID-19 vaccine candidate, which was stored on an
EMA server, had been unlawfully accessed. None of our systems were breached in connection with this incident
and we are unaware that any study participants were identified through the data being accessed.
We have put systems and procedures in place to minimize the likelihood of such incidents reoccurring; however,
we cannot guarantee that third parties will not be able to gain unauthorized access to or otherwise breach our
systems in the future. Any such unauthorized access or breach could adversely affect our business, results of
operations and financial condition.
Product liability lawsuits against us could cause us to incur substantial liabilities and could limit
commercialization of our current or future product candidates.
We face an inherent risk of product liability exposure related to the testing of any of our current or future product
candidates in clinical trials, and an even greater risk related to any commercialized products, such as our
COVID-19 vaccine. We have received product liability claims against our COVID-19 vaccine, and expect to
receive additional product liability claims in the future. If we cannot successfully defend ourselves against claims
that our products and/or our product candidates have caused injuries, we could incur substantial liabilities.
Regardless of merit or eventual outcome, liability claims may result in:
–decreased demand for any product or product candidate that we may develop;
–loss of revenue;
–substantial monetary awards to patients, healthy volunteers or their children;
–significant time and costs to defend the related litigation;
–withdrawal of clinical trial participants;
–the inability to commercialize any products or product candidates that we may develop; and
–injury to our reputation and significant negative media attention.
We carry clinical trial insurance and product liability insurance, which we believe to be sufficient in light of our
current clinical programs and commercial operations. However, the amount of coverage we have obtained may
not be adequate, and we may seek to further increase insurance coverage limits as our pipeline moves towards
commercialization. As we evolve, we may not be able to maintain insurance coverage at a reasonable cost or in
sufficient amounts to protect us against losses due to liability. On occasion, large judgments have been awarded
in class action lawsuits based on drugs or medical treatments that had unanticipated adverse effects. A
successful product liability claim or series of claims brought against us could cause the price of the ADSs to
decline and, if judgments exceed our insurance coverage, could adversely affect our results of operations and
business.
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If our products become subject to a product recall it could harm our reputation, business and financial
results.
The FDA and similar governmental authorities in other jurisdictions have the authority to require the recall of
certain commercialized products. In the case of the FDA, the authority to require a recall of a biologic product
must be based on an FDA finding that a batch, lot or other quantity of the biologic product presents an imminent
or substantial hazard to the public health. In addition, some governmental bodies outside the United States have
the authority to require the recall of any product or product candidate in the event of material deficiencies or
defects in design or manufacture. Manufacturers may, under their own initiative, recall a product if any material
deficiency in a product is found. A government-mandated or voluntary recall by us could occur as a result of
manufacturing errors, design or labeling defects or other deficiencies and issues.
Recalls of any of our products or, if approved, our product candidates, would divert managerial and financial
resources and have an adverse effect on our financial condition and results of operations. A recall
announcement could harm our reputation with customers and negatively affect our sales, if any.
Issues in the development and use of AI, combined with an uncertain regulatory environment, may result
in reputational harm, liability or other adverse consequences to our business.
We are investing in AI technology systems, including through our acquisition of InstaDeep, and such systems are
complex and rapidly changing. We face significant competition from other companies with respect to our AI and
machine learning services, along with an evolving regulatory landscape. The introduction of AI into the
development and manufacturing of our product candidates, or the provision of services relating to AI
technologies and applications, may result in new or enhanced governmental or regulatory scrutiny, litigation,
intellectual property risks, confidentiality or security risks, ethical concerns or other complications that could harm
our business, reputation or financial condition.
Uncertainty around AI may require additional investment in the development and maintenance of proprietary
datasets and development of appropriate protections and safeguards for handling the use of customer data with
AI technologies, which may be costly and could impact our expenses. In addition, AI may create content that
appears correct but is inaccurate or flawed, and if created by third parties, may be mistakenly attributed to us.
Our customers or others may rely on or use this flawed content to their detriment, which may expose us to brand
or reputational harm, competitive harm or legal liability.
Our ability to effectively monitor and respond to the rapid and ongoing developments and expectations
relating to environmental, social and governance, or ESG, matters, including related social expectations
and concerns, may impose unexpected costs or result in reputational or other harm that could have a
material adverse effect on our business, financial condition, cash flows and results of operations and
could cause the price of ADSs representing our ordinary shares to decline.
There are rapid and ongoing developments and changing, sometimes conflicting, expectations relating to ESG
matters and factors such as the environmental impact of our operations, access to our COVID-19 vaccine,
corporate governance, our product stewardship practices, management of business ethics, human rights due
diligence in our own operations and our supply chain, and workforce development. At the same time, ESG
matters, including climate change, are the subject of increased politicization, particularly in the United States.
These factors may result in increased regulatory, social or other scrutiny on us.
We believe we must address climate risks from our own contribution to climate change (inside-out perspective),
risks to our own operations due to physical effects of climate change as well as transition risks (outside-in
perspective), and interactions between both perspectives. To this end, we have set ourselves near-term
scienced-based emissions reduction targets for our own operations (scope 1, 2) and for our supply chain
(supplier engagement target for scope 3), validated by the Science Based Targets initiative, or SBTi, in early
February 2024.
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Additionally, we are addressing increasingly complex regulatory requirements with respect to human rights risks.
These requirements include German legislation, such as the Act on Corporate Due Diligence Obligations for the
Prevention of Human Rights Violations in Supply Chains (Lieferkettensorgfaltspflichtengesetz – LkSG), potential
legislative planning by the European Union, and local or regional regulations. Regulatory frameworks require us
to identify, prevent, mitigate and ideally end the extent of any potential adverse impacts or violations throughout
our own operations and value chain.
Finally, we are faced with increasing ESG related transparency and reporting obligations. These requirements
arise, for example, from the EU Corporate Sustainability Reporting Directive regulation, the European
Sustainability Reporting Standards, and the respective German implementation law and other possible
obligations.
Should we fail to meet our climate protection targets or if we are unable to adequately recognize and respond to
such developments and governmental, societal, investor and NGO expectations relating to such ESG matters,
we may have to pay substantial fines, forego corporate opportunities, become subject to additional scrutiny, incur
unexpected costs or experience damage to our reputation or our various brands. If any of these events were to
occur, there may be a material adverse effect on our business, financial condition, cash flows and results of
operations, and the price of ADSs representing our ordinary shares may decline.
We have observed that in addition to the importance of their financial performance, companies are increasingly
being judged by their performance on ESG matters. A variety of organizations measure the performance of
companies on such ESG topics, and the results of these assessments are widely publicized. We may fail to
comply with standards or best practices put forth by such organizations or by governmental or regulatory bodies.
There can be no certainty that we will manage such issues successfully, or that we will successfully meet
society’s expectations as to our proper role. Any failure or perceived failure by us in this regard could have a
material adverse effect on our reputation and on our business, the price of ADSs representing our ordinary
shares, financial condition, or results of operations, including the sustainability of our business over time.
Risks Related to our COVID-19 Vaccine and the Commercialization of our Pipeline
Demand for our COVID-19 vaccine, though difficult to predict, is expected to continue to decrease in the
near future. Changing market dynamics, including as a result of government policy and public
sentiment, will impact our revenue, which currently depends heavily on sales of our COVID-19 vaccine,
and result in challenges relating to production of our COVID-19 vaccine.
Prior to the commercialization of our COVID-19 vaccine, we had not sold or marketed any products in our
pipeline. As a result, a majority of our total revenues to date are attributable to sales of our COVID-19 vaccine.
However, we have experienced and we expect to continue to experience increasing reductions in demand for
COVID-19 vaccination generally, including for our vaccine, now that the virus has entered an endemic stage and
as a growing proportion of the population becomes vaccinated. We expect that future revenues from sales of our
COVID-19 vaccine will decrease as demand for vaccination wanes. Such revenues will depend on numerous
factors, including:
–the extent to which a COVID-19 vaccine, including any booster shot, continues to be necessary while
COVID-19 remains an endemic virus;
–competition from other COVID-19 vaccines, including those with different mechanisms of action and different
manufacturing and distribution constraints, on the basis of, among other things, efficacy, cost, convenience of
storage and distribution, breadth of approved use, side-effect profile and durability of immune response;
–our ability to successfully and timely develop effective vaccines targeting new variants and mutations of
COVID-19;
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–the extent to which changes in local, national and state government policy preferences in the United States
and other jurisdictions, including changes in vaccine recommendations, and evolving public sentiment affect
demand for COVID-19 vaccines or mRNA therapeutics and our ability to successfully commercialize our
product candidates, if approved;
–our ability to receive full regulatory approvals where we currently have, or previously have had, emergency
use authorizations or equivalents;
–our ability to expand our geographic customer base;
–our pricing and reimbursement negotiations with governmental authorities, private health insurers and other
third-party payors after our initial sales to national governments, including the transition towards ordinary-
course insurance coverage in the public and private sectors;
–the ability of countries and jurisdictions to store and distribute doses of our COVID-19 vaccine to end users at
cold temperatures;
–the safety profile of our COVID-19 vaccine, including if previously unknown undesirable effects or increased
incidence or severity of known undesirable effects are identified with our COVID-19 vaccine;
–intellectual property litigation involving our COVID-19 vaccine and COVID-19 vaccines in general; and
–our manufacturing and distribution capabilities for our COVID-19 vaccine.
We cannot accurately predict the revenues our COVID-19 vaccine will generate in future periods or for how long
our COVID-19 vaccine will continue to generate material revenues, and we cannot ensure it will maintain its
competitive position. Uncertainty in the demand for our COVID-19 vaccine and difficulties in targeting appropriate
supply of our COVID-19 vaccines have in the past resulted, and may in the future result, in significant inventory
write-downs and cancellations of contract manufacturing orders. Our business and financial condition could be
materially affected by lowered COVID-19 vaccine revenues resulting from any of the above factors, or by
production and supply chain difficulties. In addition, if our revenues or market share of, or other financial metrics
relating to, our COVID-19 vaccine do not meet the expectations of investors or securities analysts, the market
price of the ADSs representing our ordinary shares may decline.
Our reported revenue is based in part on preliminary estimates of COVID-19 vaccine sales and costs
from Pfizer that are likely to change in future periods, which may impact our reported financial results.
Our reported revenue is based in part on preliminary estimates from Pfizer and other assumptions and
judgments that we have made, which may be subject to significant uncertainties. Our revenue includes
preliminary estimates in part due to a difference in Pfizer’s financial quarter for subsidiaries outside the United
States, which consequently creates an additional time lag between the recognition of revenues and the receipt of
payment. Although our revenue recognition policy is based on facts and circumstances known to us and various
other assumptions that we believe to be reasonable under the circumstances, our actual results may deviate
from such reported revenue.
We depend on Pfizer to determine and provide estimates of the costs and profits to be shared with us in the
countries where it is commercializing our COVID-19 vaccine under our collaboration agreement with Pfizer for
our COVID-19 vaccine, which we refer to as the Pfizer Agreement. Because the information supplied by Pfizer is
preliminary and subject to change, the revenue we report based on such information is also subject to
finalization. This is particularly true for vaccine sales outside of the United States, where Pfizer has a different
reporting cycle than ours. As a result, we may not have the complete sales and costs results outside of the
United States for months not covered by the reporting period, but we are nonetheless required to report
estimated figures.
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Pfizer has historically provided us with profit figures for our COVID-19 vaccine sales in the United States using
standard U.S. transfer prices and manufacturing and shipping cost variances (as far as those have been
identified) that could be subject to adjustment (e.g., due to changes in manufacturing costs or the price of our
COVID-19 vaccine). Pfizer has also provided estimated profits for COVID-19 vaccine sales outside of the United
States that were preliminary in nature for the last month of a quarter, as Pfizer’s subsidiaries outside of the
United States have a different reporting cycle than ours. These estimated figures have changed, and in the
future such estimated figures are likely to change, as we receive final data from Pfizer for the applicable period in
accordance with the reporting cycle of Pfizer’s ex-U.S. subsidiaries and as actual costs become known. Further,
to the extent that Pfizer does not provide such preliminary information in the future, our provisional sales figures
for territories outside of the United States will be subject to an even greater level of estimate and judgment. Any
changes to the preliminary data we report herein may have an impact on our reported revenues and expenses,
profitability or financial position.
We may be unsuccessful in adapting our COVID-19 vaccine or developing future versions of our
COVID-19 vaccine to protect against variants of the SARS-CoV-2 virus, and even if we are successful, a
market for vaccines against these variants may not develop and our ability to continue to generate
income from sales of our COVID-19 vaccine is uncertain.
The COVID-19 disease itself is unpredictable and each variant comes with varying levels of transmissibility and
severity. Consequently, the burden of the disease may wane or dissipate such that our and other COVID-19
vaccines may be considered less essential from individual and public health perspectives.
Our COVID-19 vaccine was initially developed based upon the genetic sequence of the original SARS-CoV-2
virus that was first detected. The SARS-CoV-2 virus continues to evolve, and new strains of the virus or those
that are already in circulation may prove more transmissible or cause more severe forms of COVID-19 disease
than the predominant strains observed to date. Our vaccine may not be as effective in protecting against existing
and future variant strains of the SARS-CoV-2 virus as it is against the original virus or currently known strains of
the SARS-CoV-2 virus. We and Pfizer intend to continue to observe our COVID-19 vaccine, including variant-
adapted vaccine candidates, in global clinical trials. It is possible that subsequent data from these clinical trials
may not be as favorable as data we submitted to regulatory authorities to support our applications for emergency
use authorization or marketing or conditional marketing approval or that concerns about the safety of our variant-
adapted COVID-19 vaccines will arise from widespread use outside of clinical trials. While we continue to
monitor emerging SARS-CoV-2 strains, undertake investigations into the immunogenicity of our COVID-19
vaccine against new variants as they emerge and develop modified versions of our COVID-19 vaccine against
new variants, these efforts may be unsuccessful, and failure to timely and successfully adapt our vaccine to
variants of the SARS-CoV-2 virus could lead to significant reputational harm and adversely affect our financial
results. Furthermore, variant-adapted COVID-19 vaccines may not receive approval or emergency use
authorization in all jurisdictions, which could adversely affect our business prospects. It is also possible that we
may expend significant resources adapting our COVID-19 vaccine to protect against certain variants of the
SARS-CoV-2 virus, but that a market for adapted vaccines does not develop for one or more variants or that
demand does not align with our projections or cost expenditures. Moreover, even if we are successful in
developing an adapted vaccine and there is a market for the new vaccine, new variants continue to emerge and
any adapted vaccine may not be as effective in protecting against such future variant strains.
If we discover safety issues with our products, including our COVID-19 vaccine, that were not known at
the time of approval, commercialization efforts for our products could be negatively affected, approved
products could lose their approval or sales could be suspended, we could be subject to product liability
claims and our business and reputation could be materially harmed.
Our COVID-19 vaccine and any other product candidates for which we receive approval or emergency use
authorization are subject to continuing regulatory oversight, including the review of additional safety information.
Billions of doses of our COVID-19 vaccine have been delivered worldwide, and our COVID-19 vaccine is being
more widely used by patients as an authorized product than it was used in clinical trials. As a result, undesirable
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effects and other problems may be observed that were not seen or anticipated, or were not as prevalent or
severe, during clinical trials. We cannot provide assurance that newly discovered or developed safety issues will
not arise, and we have received, and expect to continue to receive, product liability claims relating to our
COVID-19 vaccine. With the use of any vaccine by a wide patient population, serious adverse events may occur
from time to time that did not arise in clinical trials or that initially appeared to be unrelated to the vaccine itself
and only with the collection of subsequent information were found to be causally related to the product. Safety
events that arise outside of a clinical trial setting are difficult to monitor, and given the widespread use of our
COVID-19 vaccine, we have experienced difficulty tracking potential treatment-related adverse events on a
global basis. Any safety issues could cause us to suspend or cease marketing of our approved products,
possibly subject us to substantial liabilities, and adversely affect our ability to generate revenue and our financial
condition. The subsequent discovery of previously unknown problems with a product could negatively affect
commercial sales of the product, result in restrictions on the product or lead to the withdrawal of the product from
the market. The reporting of adverse safety events involving our products or public speculation about such
events could cause the price of the ADSs representing our ordinary shares to decline or experience periods of
volatility.
Unexpected safety issues, including any that we have not yet observed in our clinical trials or in real world data,
could lead to significant reputational damage for us and our product development platforms going forward and
other issues, including delays in our other programs, the need for re-design of our clinical trials and the need for
significant additional financial resources.
Failure to comply with continuing regulatory requirements by us or our collaboration partners could
adversely impact regulatory approvals for our products, result in product recalls or suspensions, and/or
subject us to fines and/or other types of liabilities.
If we or our collaborators fail to comply with applicable continuing regulatory requirements, including good
industry practices, such as good manufacturing practices, or GMP, we or our collaborators may be subject to
fines, suspension or withdrawal of regulatory approvals for specific drugs, product recalls and seizures,
operating restrictions and/or criminal prosecutions. We and the manufacturers we engage to make our products
and the manufacturing facilities in which our products are made are subject to periodic review and inspection by
the U.S. Food and Drug Administration, or the FDA, and other regulatory authorities. If problems are identified
during a review or inspection, we or our collaborators may be the subject of adverse regulatory action, including
the issuance of untitled or warning letters, which could result in our inability to use the facility to make our
product or a determination that inventories are not safe for commercial sale. Any of these factors could adversely
affect our business prospects and our financial position could be materially harmed.
The successful commercialization of our product candidates will depend in part on the extent to which
governmental authorities, private health insurers and other third-party payors provide coverage and
adequate reimbursement levels and implement pricing policies favorable to our product candidates.
Failure to obtain or maintain coverage and adequate reimbursement for our product candidates, if
approved, and/or delayed payments from government authorities could limit our ability to market those
products and decrease our ability to generate revenue.
The availability and extent of reimbursement by governmental and private payors is essential for most patients to
be able to afford certain treatments, including our COVID-19 vaccine and other product candidates we may
develop and sell. In addition, because our mRNA product candidates represent an entirely new therapeutic
modality, we cannot accurately estimate how future products we may develop and sell would be priced, whether
reimbursement could be obtained, or any potential revenue. Sales of our product candidates will depend
substantially, both domestically and abroad, on the extent to which the costs of our product candidates will be
paid by healthcare management organizations, or reimbursed by government health administration authorities,
private health coverage insurers and other third-party payors. If reimbursement is not available, or is available
only to limited levels, we may not be able to successfully commercialize our product candidates. Even if
coverage is provided, the approved reimbursement amount may not be high enough to allow us to establish or
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maintain pricing sufficient to realize an adequate return on our investment in any of our products. Additionally,
even if pricing terms with governmental authorities are agreed upon, there may be delayed or denied payments.
There is significant uncertainty related to the insurance coverage and reimbursement for newly approved
products in particular in the United States, including genetic medicines. In the United States, the principal
decisions about reimbursement for new medicines are typically made by the Centers for Medicare & Medicaid
Services, or CMS, an agency within the U.S. Department of Health and Human Services, or HHS, as CMS
decides whether and to what extent a new medicine will be covered and reimbursed under Medicare. Private
payors tend to follow CMS to a substantial degree. It is difficult to predict what CMS will decide with respect to
reimbursement for novel products such as ours. Reimbursement agencies in Europe may be more conservative
than CMS. For example, a number of cancer drugs have been approved for reimbursement in the United States
but have not been approved for reimbursement in certain European countries.
Outside the United States, certain countries, including a number of member states of the European Union, set
prices and reimbursement for pharmaceutical products, with limited participation from the marketing
authorization holders. We cannot be sure that such prices and reimbursement will be acceptable to us or our
collaborators. If the regulatory authorities in these jurisdictions set prices or reimbursement levels that are not
commercially attractive for us or our collaborators, our revenues from sales by us or our collaborators, and the
potential profitability of our drug products, in those countries would be negatively affected. An increasing number
of countries are taking initiatives to attempt to reduce large budget deficits by focusing cost-cutting efforts on
pharmaceuticals for their state-run health care systems. These international price control efforts have impacted
all regions of the world but have been most drastic in the European Union. Additionally, some countries require
approval of the sale price of a product before it can be marketed. In many countries, the pricing review period
begins after marketing or product licensing approval is granted. As a result, we might obtain marketing approval
for a product in a particular country, but then may experience delays in the reimbursement approval of our
product or be subject to price regulations that would delay our commercial launch of the product, possibly for
lengthy time periods, which could negatively impact the revenues we are able to generate from the sale of the
product in that particular country.
Moreover, increasing efforts by governmental and third-party payors in the United States and abroad to cap or
reduce healthcare costs may cause such organizations to limit both coverage and level of reimbursement for
new products approved and, as a result, they may not cover or provide adequate payment for our product
candidates. The Inflation Reduction Act, or IRA, enacted in August 2022 allows HHS to negotiate the price of
certain drugs and biologics that CMS reimburses under Medicare Part B and Part D. The IRA’s negotiation
program will apply to high-expenditure single-source drugs that have been approved for at least 7 years (11
years for biologics), among other negotiation selection criteria. The negotiated prices, which became effective in
2026 for the first round of selected drugs, are capped at a statutorily-determined ceiling price. The IRA also
penalizes drug manufacturers that increase prices of Medicare Part B and Part D drugs at a rate greater than the
rate of inflation. In addition, the law eliminates the “donut hole” under Medicare Part D beginning in 2025 by
significantly lowering the beneficiary maximum out-of-pocket cost and requiring manufacturers to subsidize,
through a newly established manufacturer discount program, once the out-of-pocket maximum has been
reached. The IRA permits the Secretary of HHS to implement many of these provisions through guidance, as
opposed to regulation, for the initial years. Manufacturers that fail to comply with the IRA may be subject to
various penalties, including civil monetary penalties. These IRA provisions have begun to take effect
progressively starting in 2023, although the drug negotiation provisions of the IRA are currently the subject of
legal challenges. The effects of the IRA on our business and the healthcare industry in general are not yet
known. In addition, the Center for Medicare and Medicaid Innovation, or CMMI, has announced two new
mandatory models that propose MFN pricing for certain products covered by Medicare and one new voluntary
model that proposes MFN pricing for products covered by Medicaid. These models, or other models announced
by CMMI, could result in significantly lower prices for our products. These laws and regulations may result in
additional reductions in Medicare and other healthcare funding and otherwise affect the prices we may obtain for
any of our products for which we may obtain regulatory approval or the frequency with which any such product is
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prescribed or used. At the state level, legislatures are increasingly passing legislation and implementing
regulations designed to control pharmaceutical and biological product pricing, including price or patient
reimbursement constraints, discounts, restrictions on certain product access, and marketing cost disclosure and
transparency measures, and, in some cases, designed to encourage importing from other countries and bulk
purchasing. Officials appointed by the current presidential administration to oversee the implementation of the
IRA may take a different approach, and the administration and Congress could also pursue statutory changes to
the program, either of which could negatively affect our revenues.
We expect to experience pricing pressures in connection with the sale of any of our product candidates due to
the trend toward managed healthcare, the increasing influence of health maintenance organizations and
additional legislative changes. The downward pressure on healthcare costs in general, particularly prescription
drugs, surgical procedures and other treatments, has become very intense. As a result, increasingly high barriers
are being erected to the entry of new products in the marketplace.
Government policies, including relating to manufacturing, export controls, or tariffs, and negative public
perception regarding vaccines and mRNA-based therapeutics could severely and adversely impact the
manufacturing and sales of our COVID-19 vaccine and other product candidates we may develop, if
approved.
There is a heightened risk that vaccines could be subject to export controls, adverse emergency actions or
supply requirements by governmental and other authorities. In the past, the European Union and other regions
have imposed, or threatened to impose, export controls that would limit or block the delivery of COVID-19
vaccines manufactured in or outside their territories in instances where manufacturers have been delayed or
have not fully satisfied their delivery obligations to such governments, which could have prohibited us from
delivering our COVID-19 vaccine to other jurisdictions. Recently, trade and tariff policies among the United
States and other countries have been unsettled and are subject to frequent changes. The U.S. government has
imposed tariffs and other trade restrictions on goods across a range of industries, and such actions have at
times prompted retaliatory measures by affected countries such as China, Canada and the European Union.
While tariffs with certain countries have been temporarily reduced or paused, the imposition of new tariffs will
likely be met with further reciprocal tariffs, thus increasing the possibility of a global trade war. If trade restrictions
or tariffs reduce global economic activity, potential impacts could include declining sales; increased costs;
volatility in foreign exchange rates; and a decline in the value of our financial assets. Issued or future executive
orders or other new or changes in laws, regulations or policy regarding tariffs could have a material adverse
effect on our business, earnings and financial guidance. The actual impact of the new tariffs on our business is
subject to a number of factors including, but not limited to, restrictions on trade, the effective date and duration of
such tariffs, countries included in the scope of tariffs, changes to amounts of tariffs, potential retaliatory tariffs
imposed by other countries, and the extent to which tariffs are imposed on finished or unfinished pharmaceutical
products. Vaccines are also at risk of being subject to adverse emergency actions taken by governmental
entities in certain countries, including intellectual property expropriation, compulsory licenses, strict price controls
or other actions, such as the requirement that specific quantities of vaccine doses be set aside for designated
purposes or geographic areas. Additional changes in governmental policy preferences and regulatory decision-
making may have an adverse effect on our ability to commercialize products or, if approved, product candidates.
For example, the FDA’s approval of our LP.8.1-adapted monovalent COVID-19 vaccine is in a narrower
population than our previous variant-adapted vaccines.
Furthermore, public sentiment regarding commercialization of vaccines, the safety and efficacy of our COVID-19
vaccine, other COVID-19 vaccines and treatments, and other public perceptions and misinformation relating to
COVID-19, mRNA technology, and our and other COVID-19 vaccines may limit our ability to generate income
from sales of our COVID-19 vaccine and other product candidates we may develop and sell, including due to
changes in local, national and state government policies in the U.S. and other jurisdictions, and cause
reputational damage.
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We face significant competition with other makers of COVID-19 vaccines and may be unable to maintain
a competitive market share for our COVID-19 vaccine.
A number of competitors currently have programs to develop COVID-19 vaccine candidates, including vaccines
developed by Moderna, Inc. and Novavax, Inc. Our competitors pursuing vaccine candidates may have greater
financial, product candidate development, manufacturing and marketing resources than we do. Larger
pharmaceutical and biotechnology companies have extensive experience in clinical testing and obtaining
regulatory approval for their products, and may have the resources to invest heavily to accelerate discovery and
development of their vaccine candidates.
Our efforts to continue successful commercialization of our COVID-19 vaccine may fail if competitors develop
and commercialize COVID-19 vaccines that are safer, more effective, produce longer immunity against
COVID-19, require fewer administrations, have fewer or less severe undesirable effects, have broader market
acceptance, are more convenient to administer or distribute or are less expensive than any vaccine candidate
that we have developed or we may develop.
Our COVID-19 vaccine is sensitive to temperature, shipping and storage conditions and could be subject
to risk of loss or damage.
Our COVID-19 vaccine is, and other product candidates we develop could be, sensitive to temperature, storage
and handling conditions. In particular, while we have improved the required shipping and storage conditions of
our COVID-19 vaccine, it must be shipped and stored at cold temperatures. Loss in supply of our COVID-19
vaccine and our product candidates could occur if the product or product intermediates are not stored or handled
properly. Shelf life for our product candidates may vary by product, and it is possible that supply of our COVID-19
vaccine or our product candidates could be lost due to expiration prior to use. This has in the past led, and could
in the future lead, to additional manufacturing costs and delays in our ability to supply required quantities for
clinical trials or for commercial purposes. Such distribution challenges may make our COVID-19 vaccine a less
attractive product than other COVID-19 vaccines that do not require as cold storage, and our COVID-19 vaccine
may become increasingly less competitive as additional other vaccines become authorized for emergency use. If
we, our partners and customers are unable to adequately manage these issues, we may be exposed to product
liability claims and the market opportunity for our COVID-19 vaccine may be reduced, each of which could
adversely affect our business prospects and materially harm our financial condition.
The market opportunities for some of our product candidates may be small due to the rarity of the
disease, or limited to those patients who are ineligible for or have failed prior treatments. As the target
patient populations for some of our programs are small, we may be unable to achieve or maintain
profitability in future periods without obtaining regulatory approval for additional indications.
The FDA often approves new cancer therapies initially only for use by patients with relapsed or refractory
advanced cancer. We expect to seek approval initially for some of our product candidates in this context.
Subsequently, for those products that prove to be sufficiently beneficial, we would expect to seek approval in
earlier lines of treatment and potentially as a first-line therapy, but there is no guarantee that our product
candidates, even if approved, would be approved for earlier lines of therapy, and, prior to any such approvals,
we may have to conduct additional clinical trials. We are also developing product candidates for the treatment of
rare diseases.
Our projections of the number of people who have or will have the diseases we may be targeting may prove to
be incorrect. Further, new studies may change the estimated incidence or prevalence of these diseases. The
number of trial participants may turn out to be lower than expected. Additionally, the potentially addressable
patient population for our product candidates may be limited or may not be amenable to treatment with our
product candidates. Even if we obtain significant market share for our products, if approved, because the
potential target populations may be small, we may be unable to achieve or maintain profitability in future periods
without obtaining regulatory approval for additional indications.
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If we are unable to continue to increase our marketing and sales capabilities on our own or through third
parties, we may not be able to market and sell our product candidates effectively in the United States
and other jurisdictions, if approved, or generate sufficient product sales revenue.
We have only relatively recently developed our sales, distribution or marketing capabilities in Germany and
Türkiye. With respect to our COVID-19 vaccine, we rely heavily on the sales, distribution, and marketing
capabilities of our partners, except in Germany and Türkiye. To successfully commercialize any other products
that may result from our development programs, several of which are undergoing pivotal clinical trials, we will
need to continue developing sales and marketing capabilities in the United States, Europe and other regions,
either on our own or with others. We may enter into collaborations with other entities to utilize their mature
marketing and distribution capabilities, but we may be unable to enter into marketing agreements on favorable
terms, if at all. If our current and future collaborators do not commit sufficient resources to further commercialize
our COVID-19 vaccine and our future products, if any, and we are unable to develop the necessary marketing
capabilities on our own, we may be unable to generate sufficient product sales revenue to sustain our business.
We compete with many companies that currently have extensive and well-funded marketing and sales
operations. Without continuing to grow our internal team or obtaining the support of third parties to perform
marketing and sales functions, we may be unable to compete successfully against these more established
companies.
Our ability to achieve or maintain profitability in future periods depends in part on our and our
collaborators’ ability to penetrate global markets, where we would be subject to additional regulatory
burdens and other risks and uncertainties associated with international operations that could materially
adversely affect our business.
Our ability to achieve or maintain profitability in future periods will depend in part on our ability and the ability of
our collaborators to commercialize any products that we or our collaborators may develop in markets throughout
the world. Commercialization of products in various markets could subject us to risks and uncertainties,
including:
–obtaining, on a country-by-country basis, the applicable marketing authorization from the competent regulatory
authority;
–the burden of complying with complex and changing regulatory, tax, accounting, labor and other legal
requirements in each jurisdiction that we or our collaborators pursue;
–reduced protection for intellectual property rights;
–differing medical practices and customs affecting acceptance in the marketplace;
–import or export licensing requirements;
–governmental controls, trade restrictions or changes in tariffs;
–economic weakness, including inflation, or political instability;
–production shortages resulting from any events affecting raw material supply or manufacturing capabilities
abroad;
–longer accounts receivable collection times;
–longer lead times for shipping;
–language barriers;
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–foreign currency exchange rate fluctuations;
–the impact of epidemics, pandemics and other public health developments, such as COVID-19, on employees
and the global economy;
–reimbursement, pricing and insurance regimes; and
–the interpretation of contractual provisions governed by local laws in the event of a contract dispute.
We do not have prior experience in all of these areas, and the experience we do have in some of these areas is
limited. Our collaborators may have limited experience in these areas as well. Failure to successfully navigate
these risks and uncertainties may limit or prevent market penetration for any products that we or our
collaborators may develop, which would limit their commercial potential and our revenues.
Even if we obtain regulatory approval for our product candidates, the products may not gain the market
acceptance among physicians, patients, hospitals, treatment centers and others in the medical
community necessary for commercial success.
Even with the requisite approvals, the commercial success of our products will depend in part on the medical
community, patients, and third-party or governmental payors accepting immunotherapies in general, and our
products in particular, as medically useful, cost-effective and safe.
Any product that we bring to the market may not gain market acceptance by physicians, trial participants, third-
party payors, and others in the medical community. Additionally, ethical and legal concerns and social
preferences about research involving mRNA could result in additional regulations restricting or prohibiting the
products and processes we may use. If these products do not achieve an adequate level of acceptance, we may
not generate significant product sales revenue and may not be able to achieve or maintain profitability in future
periods. The degree of market acceptance of our product candidates, if approved for commercial sale, will
depend on a number of factors, including:
–the potential efficacy and potential advantages over alternative treatments;
–the ability to offer our products, if approved, at competitive prices;
–the prevalence and severity of any undesirable effects, including any limitations or warnings contained in a
product’s approved labeling;
–the prevalence and severity of any undesirable effects resulting from checkpoint inhibitors or other drugs or
therapies with which our products are administered;
–the relative convenience and ease of transportation, storage and administration;
–any restrictions on the use of our products, if approved, together with other medications;
–the willingness of the target patient population to try new therapies, such as mRNA vaccines and therapies,
and of physicians to prescribe these therapies;
–the strength of marketing and distribution support and timing of market introduction of competitive products;
–the extent to which changes in local, national and state government policy preferences in the United States
and other jurisdictions resulting from new elected leadership and evolving public sentiment affect demand for
COVID-19 vaccines or mRNA therapeutics and our ability to successfully commercialize our product
candidates, if approved;
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–publicity concerning our products or competing products and treatments; and
–sufficient third-party insurance coverage or reimbursement, and patients’ willingness to pay out-of-pocket in
the absence of third-party coverage or adequate reimbursement.
Even if a potential product displays a favorable efficacy and safety profile in preclinical studies and clinical trials,
market acceptance of the product will not be known until after it is launched. Our efforts to educate the medical
community and third-party payors on the benefits of the products may require significant resources and may
never be successful. Our efforts to educate the marketplace may require more resources than are required by
the conventional technologies marketed by our competitors due to the complexity and uniqueness of our
programs.
In addition, for our products that are approved for marketing, we and/or our collaborator are subject to significant
regulatory obligations regarding the submission of safety and other post-marketing information and reports for
such product, and will need to continue to comply (or ensure that our third-party providers comply) with current
GMP and current good clinical practices, or GCP, for any clinical trials that we or a collaborator conduct post-
approval. In addition, there is always the risk that we or a collaborator or regulatory authority might identify
previously unknown problems with a product post-approval, such as adverse events of unanticipated severity or
frequency. Compliance with these requirements is costly, and any such failure to comply or other issues with our
product candidates identified post-approval could have a material adverse impact on our business, financial
condition and results of operations.
Coverage and reimbursement may be limited or unavailable in certain market segments for our product
candidates, which could make it difficult for us to sell our product candidates, if approved, profitably.
Successful sales of our product candidates, if approved, depend on the availability of coverage and adequate
reimbursement from third-party payors including governmental healthcare programs, such as Medicare and
Medicaid in the United States, managed care organizations and commercial payors, among others. Significant
uncertainty exists as to the coverage and reimbursement status of any product candidates for which we obtain
regulatory approval. In addition, because certain of our product candidates represent new approaches to the
treatment of cancer, we cannot accurately estimate the potential revenue from our product candidates.
Patients who are provided medical treatment for their conditions generally rely on third-party payors to reimburse
all or part of the costs associated with their treatment. Obtaining coverage and adequate reimbursement from
third-party payors is critical to new product acceptance.
Third-party payors decide which drugs and treatments they will cover and the amount of reimbursement.
Reimbursement by a third-party payor may depend upon a number of factors, including, but not limited to, the
third-party payor’s determination that use of a product is:
–a covered benefit under its health plan;
–safe, effective and medically necessary;
–appropriate for the specific patient;
–cost-effective; and
–neither experimental nor investigational.
Obtaining coverage and reimbursement of a product from a government or other third-party payor is a time-
consuming and costly process that could require us to provide to the payor supporting scientific, clinical and
cost-effectiveness data for the use of our products. Third-party payors could require us to conduct additional
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studies, including post-marketing studies related to the cost effectiveness of a product, to qualify for
reimbursement, which could be costly and divert our resources. Even if we obtain coverage for a given product,
if the resulting reimbursement rates are insufficient, hospitals may not approve our product for use in their facility
or third-party payors may require co-payments that patients find unacceptably high. Patients are unlikely to use
our product candidates unless coverage is provided and reimbursement is adequate to cover a significant
portion of the cost of our product candidates. Separate reimbursement for the product itself may or may not be
available. Instead, the hospital or administering physician may be reimbursed only for providing the treatment or
procedure in which our product is used. Further, from time to time, CMS revises the reimbursement systems
used to reimburse healthcare providers, including the Medicare Physician Fee Schedule and Outpatient
Prospective Payment System, which may result in reduced Medicare payments. In some cases, private third-
party payors rely on all or portions of Medicare payment systems to determine payment rates. Changes to
government healthcare programs that reduce payments under these programs may negatively impact payments
from private third-party payors, and reduce the willingness of physicians to use our product candidates.
In the United States, no uniform policy of coverage and reimbursement for products exists among third-party
payors. Therefore, coverage and reimbursement for products can differ significantly from payor to payor. Further,
one payor’s determination to provide coverage for a product does not assure that other payors will also provide
coverage for the product. Adequate third-party reimbursement may not be available to enable us to maintain
price levels sufficient to realize an appropriate return on our investment in product development.
We intend to seek approval to market our product candidates in the United States, the European Union and
other selected jurisdictions. If we obtain approval for our product candidates in any particular jurisdiction, we will
be subject to rules and regulations in that jurisdiction. In some countries, particularly those in Europe, the pricing
of biologics is subject to governmental control. In these countries, pricing negotiations with governmental
authorities can take considerable time after obtaining marketing approval of a product candidate. Some of these
countries may require the completion of clinical trials that compare the cost-effectiveness of a particular product
candidate to currently available therapies. Other member states allow companies to fix their own prices for
medicines, but monitor and control company profits. The downward pressure on health care costs has become
very intense. As a result, increasingly high barriers are being erected to the entry of new products into the
marketplace. In addition, in some countries, cross-border imports from low-priced markets exert a commercial
pressure on pricing within a country.
The marketability of any product candidates for which we receive regulatory approval for commercial sale may
suffer if government and other third-party payors fail to provide coverage and adequate reimbursement. We
expect downward pressure on pharmaceutical pricing to continue. Further, coverage policies and third-party
reimbursement rates may change at any time. Even if favorable coverage and reimbursement status is attained
for one or more products for which we receive regulatory approval, less favorable coverage policies and
reimbursement rates may be implemented in the future.
The advancement of healthcare reform legislation and changes to the regulatory environment in the
United States, the European Union and elsewhere may increase the difficulty and cost for us to obtain
marketing approval of and commercialize any product candidates we or our collaborators develop and
may adversely affect the prices for such product candidates.
In the United States, there have been and continue to be a number of legislative initiatives to contain healthcare
costs.
In August 2022, the IRA was enacted, which sets forth meaningful changes to drug product reimbursement by
Medicare. The IRA is anticipated to have significant effects on the pharmaceutical industry and may reduce the
prices we can charge and reimbursement we can receive for our products in the United States, among other
effects. Any reduction in reimbursement from Medicare resulting from the IRA or other legislative or policy
changes or from other government programs may result in a similar reduction in payments from private payers.
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On August 16, 2024, CMS announced the results of a first round of discounted prices effectively set by CMS
under the IRA, applicable to ten products of other manufacturers; those discounted prices, set to take effect for
calendar year 2026, were as high as 79% from 2023 list prices. Additional products will be discounted in future
years. We cannot be sure whether additional legislative changes will be enacted, or the effect of forthcoming
guidance implementing the IRA, or what the impact of such changes on our products and product candidates
may be. Officials appointed by the current presidential administration to oversee the implementation of the IRA or
other statutes may take a different approach, and the administration and Congress could also pursue statutory
changes to this or other programs, either of which could negatively affect our revenues.
The delivery of healthcare in the European Union, including the establishment and operation of health services
and the pricing and reimbursement of medicines, is almost exclusively a matter for national, rather than
European Union, law and policy. National governments and health service providers have different priorities and
approaches to the delivery of healthcare and the pricing and reimbursement of products in that context. In
general, however, the healthcare budgetary constraints in most EU member states have resulted in restrictions
on the pricing and reimbursement of medicines by relevant health service providers. Coupled with ever-
increasing European Union and national regulatory burdens on those wishing to develop and market products,
this could prevent or delay marketing approval of our product candidates, restrict or regulate post-approval
activities, and affect our ability to commercialize any products for which we obtain marketing approval.
We expect that additional healthcare reform measures or proposals will be adopted in the future, any of which
could limit the amounts that governments will pay for healthcare products and services, including public health
measures, which could result in reduced demand for our products and product candidates or additional pricing
pressures. In the event that the pricing structures for healthcare products, such as the product candidates we are
developing, change materially and limit payments for such product candidates, our business will be adversely
impacted as our products may no longer be commercially viable based on their expected net present value; we
may have invested significant resources in product candidates that cannot be commercially developed; or we
may determine that assets that have reached an early phase of development cannot or will not be taken into
further development, notwithstanding their clinical viability. In addition, development assets or clinical programs
that are part of our collaborations may no longer be deemed commercially viable to pursue based on our
collaborators’ assessments of the impact of any proposed, announced, or legislated pricing reforms.
We cannot predict what healthcare reform initiatives may be adopted in the future. Further legislative and
regulatory developments are likely, and we expect ongoing initiatives to increase pressure on drug pricing. Such
reforms could have an adverse effect on anticipated revenues from our approved products and from product
candidates that we may successfully develop and for which we may obtain regulatory approval, and may affect
our overall financial condition and ability to develop product candidates.
Drug marketing and reimbursement regulations in the European Union and elsewhere may materially
affect our ability to market and receive coverage for our products in the member states of the European
Union and elsewhere.
Our COVID-19 vaccine is currently approved in the United States, the European Union, and other jurisdictions,
and we intend to seek approval to market other product candidates in the United States, the European Union
and other selected jurisdictions. If we obtain approval for our products or product candidates in a particular
jurisdiction, we will be subject to rules and regulations in that jurisdiction. In some countries, particularly those in
the European Union, the pricing of biologics is subject to governmental control and other market regulations that
could put pressure on the pricing and usage of our products or product candidates. In these countries, pricing
negotiations with governmental authorities can take considerable time after obtaining marketing approval of a
product candidate. In addition, market acceptance and sales of our product candidates will depend significantly
on the availability of adequate coverage and reimbursement from third-party payors for our product candidates
and may be affected by existing and future healthcare reform measures.
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In addition, in most countries outside the United States, the proposed pricing for a drug must be approved before
it may be lawfully marketed. The requirements governing drug pricing and reimbursement vary widely from
country to country. For example, the European Union provides options for its member states to restrict the range
of medicinal products for which their national health insurance systems provide reimbursement and to control the
prices of medicinal products for human use. Reference pricing used by various member states and parallel
distribution, or arbitrage between low-priced and high-priced member states, can further reduce prices. A
member state may approve a specific price for the medicinal product or it may instead adopt a system of direct
or indirect controls on the profitability of the company placing the medicinal product on the market. In some
countries, we may be required to conduct a clinical trial or other studies that compare the cost-effectiveness of
any of our product candidates to other available therapies in order to obtain or maintain reimbursement or pricing
approval. There can be no assurance that any country that has price controls or reimbursement limitations for
pharmaceutical products will allow favorable reimbursement and pricing arrangements for any of our products.
Historically, products launched in the European Union do not follow price structures of the United States and,
generally, prices tend to be significantly lower in the European Union. Publication of discounts by third-party
payors or authorities may lead to further pressure on the prices or reimbursement levels within the country of
publication and other countries. If pricing is set at unsatisfactory levels or if reimbursement of our products is
unavailable or limited in scope or amount, our revenues from sales by us or our collaborators and the potential
profitability of any of our product candidates in those countries would be negatively affected.
Risks Related to our Financial Condition and Capital Requirements
Long-term sustainable profitability is difficult to achieve and maintain over time and is highly dependent
on various factors.
Our ability to continue to generate revenues and achieve and maintain long-term sustainable profitability
depends on our ability, alone or with collaborators, to successfully complete the development of, and obtain the
regulatory approvals necessary to commercialize, our product candidates. We continue to generate revenues
from sales of our COVID-19 vaccine and additional limited revenues from other transactions. While we expect to
maintain revenue from ongoing COVID-19 vaccine sales, future demand for COVID-19 vaccination is subject to
uncertainty. Variations driven by factors such as new virus variants, legal developments, policy changes, public
health measures and public sentiment may impact long-term demand of our COVID-19 vaccine. Consequently,
our revenue projections are influenced by this inherent unpredictability. The amount of long-term revenue from
such sales, including the sales of our COVID-19 vaccine, is uncertain at this time. Our ability to generate future
revenues from pharmaceutical product sales and sales of our other products and services depends heavily on
our and our collaborators’ success in:
–completing research and preclinical and clinical development of our product candidates;
–seeking and obtaining U.S. and non-U.S. marketing approvals for product candidates for which we complete
clinical trials;
–seeking and obtaining market access and favorable pricing terms in the United States, the European Union,
and other key geographies;
–furthering the development of our own manufacturing capabilities and manufacturing relationships with third
parties in order to provide adequate (in amount and quality) products and services to support clinical
development and the market demand for our approved products and product candidates, if approved;
–obtaining market acceptance of our approved products and product candidates as a treatment option;
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–launching and commercializing products for which we obtain marketing approval and reimbursement, either
through collaborations or, if launched independently, by establishing a sales force, marketing and distribution
infrastructure;
–addressing any competing technological and market developments, in particular, declining demand for any of
our approved products;
–implementing additional internal systems and infrastructure;
–negotiating favorable terms in any collaboration, licensing or other arrangements into which we may enter;
–managing our expenses;
–maintaining, defending, protecting, enforcing and expanding our portfolio of intellectual property rights,
including patents, trade secrets and know-how; and
–attracting, hiring and retaining qualified personnel.
Additionally, we have incurred significant costs associated with the commercialization of our COVID-19 vaccine.
Our expenses could increase beyond our expectations if we are required by the FDA, the European Medicines
Agency, or EMA, or other regulatory agencies to perform clinical and other trials or make changes to our
manufacturing or quality systems in addition to those that we currently anticipate. Accordingly, such costs could
adversely affect our future ability to achieve and maintain profitability.
Our operating results may fluctuate significantly, which makes our future operating results difficult to
predict. If our operating results fall below expectations, the price of the ADSs representing our ordinary
shares could decline.
Our financial condition and operating results have varied in the past and will continue to fluctuate from one
financial period to the next due to a variety of factors, many of which are beyond our control.
Factors relating to our business that may contribute to these fluctuations include the following, as well as other
factors described elsewhere in this report:
–the size and timing of orders for our COVID-19 vaccine;
–delays or failures in advancement of existing or future product candidates into the clinic or in clinical trials;
–the occurrence of adverse events during our clinical trials or post marketing authorization;
–our ability to develop and manufacture our product candidates and commercialize and manufacture our
COVID-19 vaccine and, if approved, our product candidates, at commercial scale, including risks associated
with quality compliance, such as product design, manufacturing processes, supply chain management, and
compliance with regulatory requirements;
–our ability to manage our growth and spending;
–our ability to execute our corporate objectives;
–strategic decisions related to portfolio prioritization, which may result in certain potential one-time effects and
charges and other material adverse effects on our financial condition and results of operations;
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–the outcomes of research programs, clinical trials, or other product development or approval processes
conducted by us and our collaborators;
–the ability of our collaborators to develop and successfully commercialize products developed from our suite of
therapeutic classes;
–our relationships, and any associated exclusivity terms, with collaborators;
–our contractual or other obligations to provide resources to fund our product candidates, and to provide
resources to our collaborators or to the collaborations themselves, including take-or-pay or similar obligations;
–the extent to which we repurchase outstanding ADSs under any share repurchase plans we may enter into in
the future;
–risks associated with the international aspects of our business, including the conduct of clinical trials in
multiple locations, and the risks associated with potential international commercialization, including regulatory
approval, market competition, public sentiment and consumer demand, supply chain disruptions, and changes
to the law and regulatory policy, such as increases in tariffs, in different jurisdictions, such as the United
States;
–our ability to minimize and manage product recalls or inventory losses caused by unforeseen events, cold
chain interruption, testing difficulties or decreased demand, and our ability to write down certain inventory;
–our ability to report our financial results accurately and in a timely manner;
–our dependence on, and the need to attract and retain, key management and other personnel;
–our ability to obtain, protect, maintain, defend and enforce our intellectual property rights;
–our ability to prevent the theft or infringement, misappropriation or other violation of our intellectual property,
trade secrets, know-how or technologies;
–our and our collaborators’ ability to defend against claims of infringement of the intellectual property rights of
third parties;
–potential advantages that our competitors and potential competitors may have in securing funding, obtaining
the rights to critical intellectual property or developing competing technologies or products;
–our ability to obtain additional capital that may be necessary to expand our business;
–our collaborators’ ability to obtain and devote additional capital that may be necessary to develop and
commercialize products under our collaboration agreements, including our COVID-19 vaccine;
–our ability to minimize and manage product liability claims arising from the use of our COVID-19 vaccine and
our product candidates and other future products, if approved;
–business interruptions such as power outages, strikes, acts of terrorism or natural disasters;
–our ability to use our net operating loss carryforwards to offset future taxable income;
–risks of counterparty defaults within our asset management portfolio; and
–increased or unpredictable pricing for the commodities we rely on, including as a result of inflation.
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Each of the factors listed above may be affected by the changing impact of COVID-19 on the global community
and the global economy.
Due to the various factors mentioned above, and others, the results of any of our periods should not be relied
upon as indications of our future operating performance. Our operating results may fluctuate significantly from
one reporting period to the next, such that a period-to-period comparison of our results of operations may not be
a good indication of our future performance.
In any particular period, our operating results could be below the expectations of securities analysts or investors,
which could cause the price of the ADSs to decline. While as a general matter we intend to periodically report on
the status of our product candidate pipeline, including articulating anticipated next steps in the form of
development plans or potential data readouts, we may not always be able to provide forward-looking guidance
on the timing of those next steps. In addition, we do not control the timing of disclosures of any milestones
related to any of our programs that are managed by our collaborators. Any disclosure by a collaborator of data
that are perceived as negative, whether or not such data are related to other data that we or others release, may
have a material adverse impact on the price of the ADSs or our overall valuation. The price of the ADSs may
decline as a result of unexpected clinical trial results in one or more of our programs, including adverse safety
events reported for any of our programs.
We have incurred significant losses in the past and we may incur significant losses in the future.
Prior to the first full year of commercialization of our COVID-19 vaccine, and for the years ended December 31,
2024 and December 31, 2025, we incurred significant losses from operations due to our significant research and
development expenses and our investment in our manufacturing capabilities. Prior to commercialization of our
COVID-19 vaccine, we funded our operations primarily from private placements or issuances of ordinary shares
(including in the form of ADSs) in connection with our public offerings, generation of proceeds under our
collaboration agreements, secured bank loans and issuance of a convertible note.
We have experienced, and we expect to continue to experience, increasing reductions in demand for COVID-19
vaccination generally, including for our vaccine. We expect that future revenues from sales of our COVID-19
vaccine will decrease as demand for vaccination wanes. We plan to continue to invest heavily in research and
development as we make a strong drive to build out our global development organization and diversify our
therapeutic area footprint. Additionally, we plan to enhance capabilities through complementary acquisitions,
technologies, infrastructure and manufacturing. Even for those products for which we have obtained or may
obtain regulatory approval or emergency use authorization, our future revenues will depend upon the size of any
markets in which such products have received approval or authorization to market, our ability to achieve
sufficient market acceptance, reimbursement from third-party payors, and adequate market share in those
markets.
If achieved, profitability is difficult to maintain over time and is highly dependent on various factors. Our future
financial results will depend, in part, on the rate of our future expenditures, the extent to which we experience
long-term success of our commercial products and our ability to obtain funding through revenue from commercial
sales, equity or debt financings, sales of assets, collaborations or grants.
As part of our capital allocation strategy, we expect to continue to incur significant and increasing operating
expenses for the foreseeable future. We anticipate that our expenses will increase substantially if and as we and
our collaborators:
–continue, expand, or modify the research or development of our programs in preclinical development;
–continue, expand, or modify the scope of our clinical trials for our product candidates;
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–initiate additional preclinical, clinical, or other trials for our product candidates, including under our
collaboration agreements;
–execute on our strategic decisions related to portfolio prioritization, which may result in certain potential one-
time effects and charges and other material adverse effects on our financial condition and results of
operations;
–continue to invest in our immunotherapy platforms to conduct research to identify novel technologies;
–change our manufacturing capacity or capability;
–change or add additional suppliers;
–make changes to our infrastructure in connection with our quality control, quality assurance, legal, compliance
and other groups to support our operations as a public company and our product development and
commercialization efforts, including changes to our sites globally;
–attract and retain skilled personnel;
–seek marketing approvals and reimbursement for our product candidates;
–develop our sales, marketing, and distribution infrastructure for our COVID-19 vaccine and any other products
for which we may obtain marketing approval or emergency use authorization;
–seek to identify and validate additional product candidates;
–acquire or in-license other product candidates and technologies;
–acquire other companies;
–make milestone or other payments under any in-license agreements;
–maintain, protect, defend, enforce and expand our intellectual property portfolio; and
–experience any delays or encounter issues with any of the above.
The amount of, and our ability to use, net operating losses and research and development credits to
offset future taxable income may be subject to certain limitations and uncertainty. In addition, pending
and future tax audits within our Group, disputes with tax authorities and changes in tax law or fiscal
regulations could lead to additional tax liabilities. We are subject to routine tax audits by the respective
local tax authorities. Any additional tax liability could have an adverse effect on our business, financial
conditions, results of operations or prospects.
In Germany, we have unused German tax loss carryforwards for corporate taxes for German group entities with
pre tax group losses, though we generally have not recognized deferred tax assets related to such loss
carryforwards for International Financial Reporting Standards, or IFRS, reporting purposes as of December 31,
2025. Deferred tax assets are recognized for unused tax losses only to the extent that it is probable that taxable
profit will be available against which the losses can be utilized. In general, net operating loss, or NOL,
carryforwards in Germany do not expire. Furthermore, under current German tax laws, certain substantial
changes in the Company’s ownership and business may further limit the amount of NOL carryforwards that can
be used annually to offset future taxable income.
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For the German tax group, we incurred tax losses up to and including December 31, 2020. Even though we
recognized deferred tax assets on a majority of German tax loss carry forwards in 2020 which were fully utilized
in 2021, they are, however, subject to review and possible adjustment by the German tax authorities. In addition,
the incurred tax losses up to and including December 31, 2024 also remain subject to review.
In addition, we have U.S. federal and state NOL carryforwards due to our subsidiaries in the United States,
which may be subject to limitations on use after an ownership change.
We may not be able to utilize a material portion of our historic or current NOLs or credits in either Germany
(resulting from our German tax group or non-tax group entities in Germany) or the United States until these have
been finally assessed by the tax authorities or when the limitation period has passed. In addition, the rules
regarding the timing of revenue and expense recognition for tax purposes in connection with various transactions
are complex and uncertain in many respects, and, if challenged, our recognition may be subject to a revised
assessment. In the event any such challenge is sustained, our NOLs could be materially reduced or we could be
determined to be a material cash taxpayer for one or more years, which could have an adverse effect on our
business, financial conditions, results of operations or prospects.
Furthermore, our ability to use our NOLs or credits is conditioned upon our attaining profitability and generating
taxable income. Taxable income exceeding NOLs will be subject to taxation resulting in tax liabilities. As
described above, we incurred significant net losses in every year since our inception other than 2018, 2021,
2022 and 2023 and anticipate that in the future, we may incur losses for the majority of the group entities. Our
ability to utilize our NOL or credit carryforwards in the United States and for some other group entities is
uncertain. Therefore, we do not recognize deferred tax assets on NOLs and tax credit carryforwards in the
United States, as the requirements of IAS 12 are not fulfilled.
Under German tax laws, we are obligated to withhold a percentage of wage tax and social security
contributions on personnel expenses if contract services providers are considered to be our internal
employees and remit those withholdings to German tax authorities and social security institutions. Late
payments may subject us to penalties and fees.
Under German tax and social security laws, we are obligated to withhold a percentage of payments we make to
third parties in consideration of the services provided, in case these are considered employment payments, and
remit those withholdings to German tax authorities and social security institutions. After a significant volume of
service providers were engaged to assist with research, development, manufacturing and supply of our
COVID-19 vaccine, we discovered after internal review that we and certain of our subsidiaries did not withhold,
report and remit certain German wage taxes and social security contributions in connection with certain contract
service providers engaged in a manner comparable to internal employees, which we notified tax authorities
about. If we do not properly and timely make required payments in the future, we could be subjected to fees,
administrative offenses or other proceedings or penalties.
It is not possible to seek the refund of these wage taxes or social security contributions from either the German
tax authorities or social security institutions after filing returns. In Germany, employers are considered
secondarily liable for wage taxes.
In addition, value added taxes, or VAT, on invoices received by contract services providers who are considered
internal employees are considered non-deductible and must be repaid to the German tax authorities. It is
possible to reclaim the VAT repaid to the German tax authorities from the service provider. There is a possibility
that the relevant input VAT claims against the contract service providers may, in some instances, not be
enforceable as a result of a contract service provider no longer existing, the lapse of time or any other facts
preventing the enforcement of such claims.
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We may require substantial additional financing to achieve our goals, and a failure to obtain this capital
on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our product
development programs, commercialization efforts or other operations.
Our operating plans may change as a result of many factors currently unknown to us, and we may need to seek
additional funds sooner than planned, through public or private equity or debt financings, government or other
third-party funding, sales of assets, marketing and distribution arrangements, other collaborations and licensing
arrangements, or a combination of these approaches. We may require additional capital to obtain regulatory
approval for, and to commercialize, future product candidates. Even if we believe we have sufficient funds for our
current or future operating plans, we may seek additional capital if market conditions are favorable or if we have
specific strategic considerations. Our spending will vary based on new and ongoing development and corporate
activities. Due to the high uncertainty of the length of time and activities associated with discovery and
development of our product candidates, we are unable to estimate the actual funds we will require for
development, marketing and commercialization activities.
Our future funding requirements, both near and long term, will depend on many factors, including, but not limited
to:
–the initiation, progress, timing, costs, and results of preclinical or nonclinical studies and clinical trials for our
product candidates;
–the amount and timing of revenues and associated costs from sales of our COVID-19 vaccine;
–the results of research and our other platform activities;
–the clinical development plans we establish for our product candidates;
–the terms of any agreements with our current or future collaborators, and the achievement of any milestone
payments under such agreements to be paid to us or our collaborators;
–the terms of any other strategic transactions, including relating to any acquisitions, into which we enter;
–the number and characteristics of product candidates that we develop or may in-license;
–the outcome, timing and cost of meeting regulatory requirements established by the FDA, the EMA and other
comparable regulatory authorities;
–the cost of filing, prosecuting, obtaining, maintaining, protecting, defending and enforcing our patent claims
and other intellectual property rights, including actions for patent and other intellectual property infringement,
misappropriation and other violations brought by third parties against us regarding our products or product
candidates or actions by us challenging the patent or intellectual property rights of others;
–the effect of competing technological and market developments, including other products that may compete
with one or more of our product candidates;
–the cost and timing of completion and further expansion of clinical and commercial scale manufacturing
activities sufficient to support all of our current and future programs, including the development of modular
production and clinical facilities in various markets via our BioNTainer network; and
–the cost of establishing sales, marketing, and distribution capabilities for any product candidates for which we
may receive marketing approval and reimbursement in regions where we choose to commercialize our
products on our own.
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To date, we have financed our operations primarily through the sale of equity securities, revenue from
collaborations, and revenue from sales of our COVID-19 vaccine. While we are currently generating product
sales and royalty revenue to finance our operations, we cannot be certain that we will continue to generate
sufficient revenue from product sales and royalties to finance our operations. If we were to seek financing from
outside sources, that additional funding may not be available on favorable terms, or at all. Should our revenues
sufficiently decrease in the future, we expect to finance our future cash needs through a combination of product
sales, public or private equity offerings, debt financings, collaborations, licensing arrangements, and other
marketing or distribution arrangements. Any fundraising efforts may divert our management from their day-to-day
activities, which may adversely affect our ability to develop and commercialize our product candidates. In
addition, we cannot guarantee that future financing will be available in sufficient amounts, at the right time, on
favorable terms, or at all, including as a result of the impact that the shift of COVID-19 towards an endemic
phase and other global events, such as political upheavals and economic downturns, may have on the capital
markets.
Negative clinical trial data or setbacks, or perceived setbacks, in our programs or with respect to our technology
could impair our ability to raise additional financing on favorable terms, or at all. Moreover, the terms of any
financing may adversely affect the holdings or the rights of our shareholders, and the issuance of additional
securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of the
ADSs representing our ordinary shares to decline. If we raise additional funds through public or private equity
offerings, the terms of these securities may include liquidation or other preferences that may adversely affect our
shareholders’ rights.
Further, to the extent that we raise additional capital through the sale of ADSs, ordinary shares or securities
convertible or exchangeable into ordinary shares or ADSs, share ownership interests will be diluted. If we raise
additional capital through debt financing, we would be subject to fixed payment obligations and may be subject
to security interests in our assets and covenants limiting or restricting our ability to take specific actions, such as
incurring additional debt, making capital expenditures or declaring dividends. If we raise additional capital
through marketing and distribution arrangements, sales of assets, collaborations, or licensing arrangements with
third parties, we may have to relinquish certain valuable rights to our product candidates, technologies, future
revenue streams or research programs. We also could be required to seek collaborators for one or more of our
current or future product candidates at an earlier stage than otherwise would be desirable or relinquish our rights
to product candidates or intellectual property that we otherwise would seek to develop or commercialize
ourselves. If we are unable to raise additional capital in sufficient amounts, at the right time, on favorable terms,
or at all, we may have to significantly delay, scale back or discontinue the development or commercialization of
one or more of our products or product candidates, or one or more of our other research and development
initiatives. Any of the above events could significantly harm our business, prospects, financial condition and
results of operations, cause the price of the ADSs to decline, and negatively impact our ability to fund operations.
We may encounter difficulties in developing and expanding our company and managing such
development and expansion, which could disrupt our operations.
To manage our anticipated development and expansion, we must continue to implement and improve our
managerial, operational, legal, compliance and financial systems, expand our facilities, and continue to recruit
and train additional qualified personnel. This includes our acquisitions of Biotheus in January 2025 and CureVac
in December 2025, as well as strategic initiatives more generally. In addition, our management may need to
divert a disproportionate amount of its attention away from its day-to-day activities and devote a substantial
amount of time to managing these development activities.
As an evolving biotechnology company, we are actively pursuing drug classes, platforms and product candidates
in many therapeutic areas and across a wide range of diseases. Successfully developing products for, and fully
understanding the regulatory and manufacturing pathways to, all of these therapeutic areas and disease states
requires a significant depth of talent, resources and corporate processes in order to allow simultaneous
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execution across multiple areas. Due to our limited resources, we may not be able to effectively manage this
simultaneous execution and the expansion of certain operations or recruit and train additional qualified
personnel. This may result in weaknesses in our infrastructure and/or give rise to operational mistakes, legal or
regulatory compliance failures, loss of business opportunities, loss of employees and reduced productivity
among remaining employees. The physical expansion of our operations may lead to significant costs and may
divert financial resources from other projects, such as the development of our product candidates. If our
management is unable to effectively manage our expected development, our expenses may increase more than
expected, our ability to generate or increase our revenue could be reduced and we may not be able to effectively
implement our business strategy. Our future financial performance and our ability to compete effectively and
commercialize our COVID-19 vaccine and our product candidates, if approved, will depend in part on our ability
to effectively manage the current and future development of our company.
We incur significant costs as a result of operating as a public company, and our management is required
to devote substantial time to compliance initiatives. We are subject to financial reporting and other
requirements for which our accounting and other management systems and resources may not be
adequately prepared. We may fail to comply with the rules that apply to public companies, including
Section 404 of the Sarbanes-Oxley Act of 2002, which could result in sanctions or other penalties that
would harm the business.
As a public company, we incur significant legal, accounting and other expenses. The U.S. federal securities laws,
including the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, and rules subsequently implemented by
the SEC and the Nasdaq Stock Market LLC, or Nasdaq, have imposed various requirements on public
companies, including requirements to file annual and event-driven reports with respect to our business and
financial condition, and to establish and maintain effective disclosure and financial controls and corporate
governance practices. Our management and other personnel need to devote a substantial amount of time to
these compliance initiatives. Moreover, these rules and regulations result in substantial legal and financial
compliance costs and have made some activities time-consuming and costly. We may not be able to produce
reliable financial statements or file these financial statements as part of a periodic report in a timely manner with
the SEC or comply with Nasdaq listing requirements. In addition, we could make errors in our financial
statements that could require us to restate our financial statements.
Pursuant to Section 404 of the Sarbanes-Oxley Act, or Section 404, we are required to furnish a report by our
management on our internal control over financial reporting, including the attestation report on internal control
over financial reporting issued by our independent registered public accounting firm. To maintain compliance with
Section 404, we document and evaluate our internal control over financial reporting, which is both costly and
challenging. In this regard, we have needed to continue to dedicate internal resources, have engaged outside
consultants, and have adopted a detailed work plan to assess and document the adequacy of internal control
over financial reporting. We will continue to implement steps to improve control processes as appropriate,
validate through testing that controls are functioning as documented, and implement a continuous reporting and
improvement process for internal control over financial reporting. Despite our efforts, there is a risk that in the
future neither we nor our independent registered public accounting firm will be able to conclude within the
prescribed timeframe that our internal control over financial reporting is effective as required by Section 404. This
could result in an adverse reaction in the financial markets due to a loss of confidence in the reliability of our
financial statements.
Shareholder activism, the current political environment, and the current high level of government intervention
and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to
additional compliance costs and impact the manner in which we operate our business in ways we cannot
currently anticipate. For example, effective March 18, 2026, pursuant to the Holding Foreign Insiders
Accountable Act, directors and officers of foreign private issuers, including us, are required to comply with the
beneficial ownership reporting requirements of Section 16(a) of the Exchange Act. In addition, the SEC has
issued a concept release in June 2025 soliciting comment on potential changes to the regulatory framework
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applicable to foreign private issuers, including potential modification or elimination of certain accommodations
currently available to foreign private issuers. Our management and other personnel need to devote a substantial
amount of time to these compliance initiatives.
If we identify material weaknesses in our internal control over financial reporting and fail to remediate
such material weaknesses, we may not be able to report our financial results accurately or to prevent
fraud.
Our management is responsible for establishing and maintaining internal control over financial reporting,
disclosure controls, and compliance with the other requirements of the Sarbanes-Oxley Act and the rules
promulgated by the SEC thereunder. Internal control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in
accordance with international financial reporting standards. A material weakness is defined as a deficiency, or a
combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility
that a material misstatement of a company’s annual or interim financial statements will not be prevented or
detected by the company’s internal controls on a timely basis.
If we fail to comply with the relevant rules and regulations or otherwise fail to prepare our financial statements in
accordance with international financial reporting standards, a material weakness may arise. If we are unable to
successfully remediate any material weaknesses, our financial statements could contain material misstatements
discovered in the future that could cause us to fail to meet our future reporting obligations and cause the price of
the ADSs to decline.
If we fail to appropriately account for complex terms in our collaboration and licensing agreements, we
could be required to restate our financial statements.
Our collaboration and licensing agreements involve complex terms and significant judgment in determining the
appropriate accounting treatment. The accounting for such agreements is often subject to interpretation and
evolving guidance. If our accounting assessments are later determined to be incorrect, we may be required to
restate previously issued financial statements, which could have a material adverse effect on our financial
condition and results of operations.
We have various international trade obligations, including customs value calculation, customs tariff
number classification and other related securities requirements. Late payments to customs authorities
may subject us to penalties and fees.
Our supply chain, production and distribution network across the globe creates an increasing level of complexity
in customs and foreign trade processes. The requirements for internal control systems are increasing and must
be developed simultaneously. The risk management system for customs and foreign trade, which we are
continuously improving, determines which stakeholders, goods, and means of transport should be examined and
to what extent. These risks include the potential for non-compliance with customs value calculation, customs
tariff number classification, trade restrictions, security regulations as well as the potential failure to facilitate
international trade. We have in the past discovered that certain of our and our subsidiaries’ customs value
calculations were not applied correctly, following which we notified the customs authorities of potential late
payments.
We are, and will likely continue to be, subject to various audits that arise from time to time, including customs
and potential future foreign trade audits. If we do not properly address our international trade and customs
requirements, we could be subjected to penalties and fees.
As a “foreign private issuer,” we are exempt from a number of rules under the U.S. securities laws, as
well as Nasdaq rules, and we are permitted to file less information with the SEC than U.S. companies.
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This may limit the information available to holders of the ADSs and may make our ordinary shares and
the ADSs less attractive to investors.
We are a “foreign private issuer,” as defined in the rules and regulations of the SEC, and, consequently, we are
not subject to all of the disclosure requirements applicable to companies organized within the United States.
Although the SEC in June 2025 issued a concept release soliciting public comment on the definition of “foreign
private issuer” and has signaled interest in exploring other rules relating to foreign private status, we currently
remain exempt from certain rules under the U.S. Securities Exchange Act of 1934, as amended, or the
Exchange Act, that regulate disclosure obligations and procedural requirements related to the solicitation of
proxies, consents or authorizations applicable to a security registered under the Exchange Act. Effective March
18, 2026, pursuant to the Holding Foreign Insiders Accountable Act, directors and officers of foreign private
issuers, including us, are required to comply with the beneficial ownership reporting requirements of Section
16(a) of the Exchange Act. However, our officers and directors are exempt from the “short-swing” profit recovery
and short sale prohibition provisions of Section 16 of the Exchange Act. Moreover, we are not required to file
periodic reports and financial statements with the SEC as frequently or as promptly as U.S. public companies.
Accordingly, there may be less publicly available information concerning our company than there is for U.S.
public companies.
As a foreign private issuer, we file an Annual Report on Form 20-F within four months of the close of each
financial year ending December 31 and reports on Form 6-K relating to certain material events promptly after we
publicly announce these events. Additionally, we rely on a provision in Nasdaq’s Listed Company Manual that
allows us to follow German company law and European law applicable to European stock corporations in
general, the German Stock Corporation Act (Aktiengesetz), the Council Regulation (EC) No 2157/2001 of
October 8, 2001 on the Statute for a European company (SE), or the SE Regulation, and the German Act on the
Implementation of Council Regulation (EC) No 2157/2001 of October 8, 2001 on the Statute for a European
company (SE) (Gesetz zur Ausführung der Verordnung (EG) NR. 2157/2001 des Rates vom 8. Oktober 2001
über das Statut der Europäischen Gesellschaft (SE)) (SE-Ausführungsgesetz-SEAG), in particular with regard to
certain aspects of corporate governance. This allows us to follow certain corporate governance practices that
differ in significant respects from the corporate governance requirements applicable to U.S. companies listed on
Nasdaq.
For example, we are exempt from regulations of Nasdaq that require a listed U.S. company to:
–have a majority of the board of directors consist of independent directors;
–require non-management directors to meet on a regular basis without management present;
–adopt a code of conduct and promptly disclose any waivers of the code for directors or executive officers that
should address certain specified items;
–have an independent compensation committee;
–have an independent nominating committee;
–solicit proxies and provide proxy statements for all shareholder meetings;
–review related party transactions; and
–seek shareholder approval for the implementation of certain equity compensation plans and issuances of
ordinary shares.
As a foreign private issuer, we are permitted to follow home country practice in lieu of the above requirements.
We therefore continue to follow German corporate governance practices in lieu of the corporate governance
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requirements of Nasdaq in certain respects. In particular, we follow German corporate governance practices in
connection with the distribution of annual and interim reports to shareholders, the application of our code of
conduct to our employees and the Supervisory Board, executive remuneration disclosure, proxy solicitation in
connection with shareholders’ meetings, and obtaining shareholder approval in connection with the
establishment of, or material amendment to, certain equity-based compensation plans.
Our audit committee is required to comply with the provisions of Section 301 of the Sarbanes-Oxley Act and Rule
10A-3 of the Exchange Act, both of which are also applicable to U.S. companies listed on Nasdaq. As we are a
foreign private issuer, however, our audit committee is not subject to additional requirements of Nasdaq
applicable to listed U.S. companies, including an affirmative determination that all members of the audit
committee are “independent,” using more stringent criteria than those applicable to us as a foreign private issuer.
Due to the above exemptions for foreign private issuers, our shareholders will not be afforded the same
protections or information generally available to investors holding shares in public companies organized in the
United States, some investors may find the ADSs less attractive as a result, and there may be a less active
trading market for the ADSs.
We face risks related to catastrophic global events including natural disasters, political crises, or public
health epidemics and pandemics and other public health developments, that could adversely affect our
operations.
Our business could be adversely impacted by the effects of catastrophic global events, including natural
disasters such as an earthquake, fire, hurricane, tornado, flood or significant power outage; public health crises
such as the COVID-19 pandemic; political crises, such as terrorist attacks, war and other political instability,
including the ongoing geopolitical conflicts in the Middle East and Ukraine, and resulting sanctions imposed and
retaliatory actions taken in response to such sanctions; or other catastrophic events.
For example, prolonged or expanded conflicts, and political responses to global actions, could destabilize oil and
gas supply and demand patterns, increase energy volatility and have severe adverse effects on regional and
global supply chains and economies and our business. We also continue to evaluate the impacts that energy
shortages may have on our partners, suppliers and service providers. Were any of these parties to experience
significant impacts from any energy shortage, our business could be materially harmed. We cannot predict with
certainty the impact that volatility in energy prices could have on our or their operations, including on the
manufacturing of our COVID-19 vaccine and the manufacturing and testing of our product candidates.
Although we have generated revenues from sales of our COVID-19 vaccine, there remains uncertainty regarding
other potential effects of COVID-19 on our business. For example, if a new variant of COVID-19 emerges for
which existing vaccines, including our COVID-19 vaccine, are ineffective, infections may become even more
widespread, negatively impact our ability to enroll patients in clinical studies and complete clinical trials on the
timelines we currently anticipate, or result in an economic downturn that could affect demand for our products
and services or our ability to raise capital, which could have a material adverse effect on our business, operating
results and financial condition. Our suppliers, licensors or collaborators could also be disrupted by conditions
related to COVID-19 or other pandemics and epidemics, possibly resulting in disruption to our supply chain,
clinical trials, partnerships or operations.
Our insurance policies are expensive and protect us only from some business risks, which leaves us
exposed to significant uninsured liabilities.
We maintain insurance coverage that we believe is appropriate for our business; however, such coverage
involves significant costs, is increasingly expensive, and does not cover all potential risks, which may expose us
to uninsured or underinsured liabilities. We do not carry insurance for all categories of risk that our business may
encounter and insurance coverage is becoming increasingly expensive. We do not know if we will be able to
maintain existing insurance with adequate levels of coverage, and any liability insurance coverage we acquire in
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the future may not be sufficient to reimburse us for any expenses or losses we may suffer. We currently maintain
insurance coverage for losses relating to property damage, business interruption, transportation, product liability,
cyber matters, clinical trials, and several other areas of coverage. For example, attracting and retaining qualified
individuals to serve on our Supervisory Board and our Management Board requires that we obtain and maintain
adequate director and officer liability insurance, which has increased in cost as our operations have evolved. We
are dedicating resources to exploring additional avenues for more adequate coverage as our business evolves.
However, the coverage or coverage limits of our insurance policies may not be adequate. If our losses exceed
our insurance coverage, our financial condition would be adversely affected. In the event of contamination or
injury, we could be held liable for damages or be penalized with fines in an amount exceeding our resources.
Clinical trials or regulatory approvals for any of our product candidates could be suspended, which could
adversely affect our results of operations and business, including by preventing or limiting the development and
commercialization of any product candidates that we or our collaborators may develop.
Adverse developments affecting financial institutions, companies in the financial services industry or
the financial services industry generally, such as actual events or concerns involving liquidity, defaults
or non-performance, could adversely affect our operations and liquidity.
Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect
financial institutions or other companies in the financial services industry or the financial services industry
generally, or concerns or rumors about any events of these kinds, have in the past and may in the future lead to
market-wide liquidity problems.
There is no guarantee that the U.S. Department of Treasury, the Federal Deposit Insurance Corporation, and
Federal Reserve Board will provide access to uninsured funds in a timely fashion, or at all, in the event of the
closure of banks or financial institutions.
While we maintain our cash and cash equivalents in multiple financial institutions worldwide, our access to our
cash and cash equivalents in amounts adequate to finance our operations could be significantly impaired by the
financial institutions with which we have arrangements directly facing liquidity constraints or failures. In addition,
investor concerns regarding the U.S. or international financial systems could result in less favorable commercial
financing terms, including higher interest rates or costs and tighter financial and operating covenants, or
systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us to acquire
financing on acceptable terms or at all. Any material decline in available funding or our ability to access our cash
and cash equivalents could adversely impact our ability to meet our operating expenses, result in breaches of
our contractual obligations or result in violations of federal or state wage and hour laws, any of which could have
material adverse impacts on our operations and liquidity.
Risks Related to the Manufacturing of our COVID-19 Vaccine, our Product Candidates
and Future Pipeline
Our COVID-19 vaccine and product candidates are based on novel technologies and they may be
complex and difficult to manufacture. We may encounter difficulties in manufacturing, product release,
shelf life, testing, storage, supply chain management or shipping. If we or any of the third-party
manufacturers we work with encounter such difficulties, our ability to supply materials for clinical trials
or any approved product could be delayed or stopped.
The manufacturing processes for our COVID-19 vaccine and our product candidates are novel and complex.
Due to the novel nature of this technology and the recency of our experience at larger scale production, we may
encounter difficulties in manufacturing, product release, shelf life, testing, storage and supply chain
management, or shipping. These difficulties could be due to any number of reasons, including, but not limited to,
complexities of producing batches at larger scale, equipment failure, choice and quality of raw materials and
excipients, analytical testing technology, and product instability. In an effort to optimize product features, we have
in the past and may in the future make changes to our product candidates in their manufacturing and stability
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formulation and conditions. This has resulted in the past, and may in the future result, in our having to resupply
batches for preclinical, clinical, or commercial activities when there is insufficient product stability during storage
and insufficient supply. Insufficient stability or shelf life of our products or product candidates could materially
delay our or our collaborators’ ability to continue the clinical trial for that product candidate or require us to begin
a new clinical trial with a newly formulated drug product, due to the need to manufacture additional preclinical,
clinical or commercial supply.
Our rate of innovation is high, which has resulted in, and will continue to cause a high degree of, technology
change that can negatively impact product comparability during and after clinical development. Furthermore,
technology changes may drive the need for changes in, modification to, or the sourcing of, new manufacturing
infrastructure or may adversely affect third-party relationships.
The process to generate mRNA medicines is complex and, if not developed and manufactured under well-
controlled conditions, can adversely impact pharmacological activity. We may encounter difficulties in scaling up
our manufacturing process, thereby potentially impacting clinical and commercial supply. Additionally, for
individualized therapies, we may encounter issues with our ability to timely and efficiently manufacture product
given the on-demand requirements of such therapies, thereby potentially impacting clinical and commercial
supply.
As we continue developing new manufacturing processes for our drug substance and drug product, the changes
we implement to the manufacturing process may impact, in turn, specification and stability of the drug product.
Changes in our manufacturing processes may lead to failure of lots and this could lead to a substantial delay in
our clinical trials or an inability to supply sufficient commercial quantities of drug product. Our mRNA product
candidates may prove to have a stability profile that leads to an unfavorable shelf life. This poses risk in supply
requirements, wasted stock and higher cost of goods.
We are dependent on a number of equipment providers who are also implementing novel technology.
Further, we have developed our own custom manufacturing equipment for certain of our product
candidates. If such equipment malfunctions or we encounter unexpected performance issues, we could
encounter delays or interruptions to clinical and commercial supply.
Due to the number of different programs, we may in the future have cross contamination of products inside of our
factories, CROs, external CMOs, suppliers or in the clinic that affect the integrity of our products. Additionally, for
some programs the manufacturing scale is extremely small compared to the standard volumes of supply, such
that we run the risk of contaminating the process each time we reopen a container to use remaining supplies.
As we scale the manufacturing output for particular programs, we plan to continuously improve yield, purity and
the pharmaceutical properties of our product candidates from IND-enabling studies through commercial launch,
including shelf life stability and solubility properties of drug product and drug substance. Due to continuous
improvement in manufacturing processes, we may switch processes for a particular program during
development. However, after the change in process, more time is required for pharmaceutical property testing,
such as six- or 12- month stability testing. That may require resupplying clinical or commercial material, or
making additional GMP batches to keep up with clinical trial demand before such pharmaceutical property
testing is completed.
We are utilizing a number of raw materials and excipients that are either new to the pharmaceutical industry or
are being employed in a novel manner. Some of these raw materials and excipients have not been scaled to a
level to support commercial supply and could experience unexpected manufacturing or testing failures, or supply
shortages. Such issues with raw materials and excipients could cause delays or interruptions to clinical and
commercial supply of our COVID-19 vaccine and our product candidates. Further, now and in the future, one or
more of our programs may have a single source of supply for raw materials and excipients. Some of our
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suppliers are located in countries different from our manufacturing sites. Export restrictions could lead to
unplanned interruptions in manufacturing, thus impacting supply of both clinical and commercial material.
We have established a number of analytical assays, and may have to establish several more, to assess the
quality of our mRNA products and product candidates. We may identify gaps in our analytical testing strategy
that might prevent release of product or could require product withdrawal or recall. For example, we may
discover new impurities that have an impact on product safety, efficacy or stability. This may lead to an inability to
release mRNA products or product candidates until the manufacturing or testing process is rectified.
Our product and product intermediates are extremely temperature sensitive, and we may learn that any or all of
our products are less stable than desired. We may also find that transportation conditions negatively impact
product quality. This may require changes to the formulation or manufacturing process for one or more of our
products or product candidates and result in delays or interruptions to clinical or commercial supply. In addition,
the cost associated with such transportation services and the limited pool of vendors may also add additional
risks of supply disruptions. As we transport intermediate products with holding times in refrigeration (TIR) and
allowed times out of refrigeration (TOR) across long distances and crossing borders, traffic issues and customs
delays could lead to the loss of batches which would need to be replaced.
Certain of our product candidates are uniquely manufactured for each patient and we may encounter
difficulties in production, particularly with respect to scaling our manufacturing capabilities. If we or any
of the third-party manufacturers with whom we contract encounter these types of difficulties, our ability
to provide such product candidates for clinical trials or, if approved, products for patients could be
delayed or stopped, or we may be unable to maintain a commercially viable cost structure.
We custom design and manufacture certain product candidates that are unique and tailored specifically for each
patient. Manufacturing unique lots of these product candidates is susceptible to product loss or failure due to
issues with:
–logistics associated with the collection of a patient’s tumor, blood or other tissue sample;
–shipping such samples to a facility for genetic sequencing;
–next-generation sequencing of the tumor mRNA;
–biopsy of a sufficient quantity of cancerous tissue to allow for proper sequencing and identification of tumor-
specific mutations;
–identification of appropriate tumor-specific mutations;
–the use of a software program, including proprietary and open source components, which is hosted in the
cloud and a part of our product candidate, to assist with the design of the patient-specific mRNA, which
software must be maintained and secured;
–effective design of the patient-specific mRNA that encodes for the required neoantigens;
–batch-specific manufacturing failures or issues that arise due to the uniqueness of each patient-specific batch
that may not have been foreseen;
–quality control testing failures;
–unexpected failures of batches placed on stability;
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–shortages or quality control issues with single-use assemblies, consumables or critical parts sourced from
third-party vendors that must be changed out for each patient-specific batch;
–significant costs associated with individualized manufacturing that may adversely affect our ability to continue
development;
–successful and timely manufacture and release of the patient-specific batch;
–shipment issues encountered during transport of the batch to the site of patient care;
–the ability to define a consistent safety profile at a given dose when each participant receives a unique
treatment; and
–our reliance on single source suppliers.
We also continue to evolve our own custom manufacturing equipment. This equipment may not function as
designed, which may lead to deviations in the drug product being produced. This can lead to increased batch
failure and the inability to supply patients enrolled in the clinical trial. If our clinical development plans are
expanded, we may not be able to supply this expanded need reliably without significant investments due to the
custom nature of the equipment and single-use assemblies. In addition, there will be considerable time to scale
up our facilities or build new facilities before we can begin to meet any commercial demand if one or more of our
individualized product candidates are approved. This expansion or addition of new facilities could also lead to
product comparability issues, which can further delay introduction of new capacity.
For those of our product candidates that are manufactured for each individual patient, we are required to
maintain a chain of identity with respect to each patient’s tissue sample, the sequenced data derived from such
tissue sample, the results of such patient’s genomic analysis and the custom manufactured product for such
patient. Maintaining such a chain of identity is difficult and complex, and failure to do so could result in product
mix-up, adverse patient outcomes, loss of product, or regulatory action, including withdrawal of any approved
products from the market. Further, as our product candidates are developed through early-stage clinical studies
to later-stage clinical trials towards approval and commercialization, we expect that multiple aspects of the
complicated collection, analysis, manufacture and delivery processes will be modified in an effort to optimize
processes and results. These changes may not achieve the intended objectives, and any of these changes could
cause our product candidates to perform differently than we expect, potentially affecting the results of clinical
trials.
Our inability to manufacture sufficient or appropriate quantities of our COVID-19 vaccine or any of our
product candidates, or our failure to comply with applicable regulatory requirements, could materially
and adversely affect our business.
Manufacturing is a vital component of our individualized immunotherapy approach, and we have invested
significantly in our manufacturing facilities, including the acquisition of a manufacturing site in Marburg, Germany,
the construction of a novel modular manufacturing facility that we refer to as a “BioNTainer,” and the construction
of a facility to support manufacturing of our Individualized Vaccines Against Cancer candidates. All internal
manufacturing is performed under GMP guidelines. We also rely on a network of CMOs for the manufacture of
our COVID-19 vaccine. We do not rely on any external CMOs for the manufacture of our individualized product
candidates and at this time, and we have limited redundancy among our facilities. Due to the individualized
nature of our product candidates, we do not maintain product reserves. If any of our or our external CMOs’
manufacturing facilities, including our BioNTainer units, experience difficulties, including related to
manufacturing, product release, shelf life, testing, storage and supply chain management or shipping, our clinical
development programs may be delayed or suspended until we or our external CMOs can resume operations.
We may also be required to incur significant expenditures to resolve such difficulties.
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We and our collaboration partner also have experienced, and continue to face the risk of, inventory write-downs
or redundant production capacities with respect to our COVID-19 vaccine. Planned new formulations of our
COVID-19 vaccine, including versions that could protect against new variants of COVID-19, have resulted or
may result in significant research and development expense that was not or may not be recouped. In addition,
we have experienced in the past, and may experience in the future, redundant production capacities under our
agreements with CMOs due to planned new formulations, adaptations of our COVID-19 vaccine and increased
internal manufacturing capacities. Significant inventory write-downs or redundant manufacturing expenses would
negatively impact our results of operations.
Our facilities are subject to various regulatory requirements and may be subject to announced or unannounced
inspections by the FDA or other regulatory authorities at any time during the development or commercialization
phase. If we or our external CMOs cannot successfully manufacture material that conforms to our specifications
and the strict regulatory requirements of the FDA, the EMA or comparable regulatory authorities in other
jurisdictions, we may not be able to rely on our or our external CMOs’ manufacturing facilities for the
manufacture of our product candidates. If the FDA, the EMA or another comparable regulatory authority finds our
or our external CMOs’ facilities inadequate for the manufacture of our COVID-19 vaccine or our product
candidates or otherwise deficient, including as a result of a site inspection, such facilities may be the subject of
adverse regulatory action, including the issuance of untitled or warning letters. If such facilities are subject to
enforcement action in the future or are otherwise inadequate, we may need to find alternative manufacturing
facilities, which would significantly delay or otherwise impact our ability to develop, obtain regulatory approval for
or market our COVID-19 vaccine or our product candidates.
Additionally, we may experience manufacturing difficulties due to resource constraints, labor disputes or unstable
political environments. If we were to encounter any of these difficulties, our ability to provide our product
candidates to patients in clinical trials, or to provide approved products for the treatment of patients, would be
jeopardized.
We are subject to regulatory and operational risks associated with the physical and digital infrastructure
at both our internal manufacturing facilities and at those of our external service providers.
The designs of our facilities are based on current standards for biotechnology facilities. They have been
reviewed and approved by local authorities and have also received GMP manufacturing licenses. We have
designed our facilities to incorporate a significant level of automation of equipment with integration of several
digital systems to improve efficiency of operations. We have attempted to achieve a high level of digitization for
clinical and commercial manufacturing facilities relative to industry standards. While this is meant to improve
operational efficiency, this may pose additional risk of process equipment malfunction and even overall
manufacturing system failure or shutdown due to internal or external factors including, but not limited to, design
issues, system compatibility or potential cybersecurity breaches. This may lead to a delay in supply or shutdown
of our facilities. Any disruption in our manufacturing capabilities could cause delays in our production capacity for
our drug substances or drug products, impose additional costs, or require us to identify, qualify and establish an
alternative manufacturing site, the occurrence of which could have a material adverse effect on our business,
financial condition, results of operations and prospects.
As we expand our development and commercial capacity, we may continue to establish additional manufacturing
capabilities in different jurisdictions, which may lead to regulatory delays or prove costly. If we fail to select the
correct location, complete the construction in an efficient manner, recruit required personnel, and/or generally
manage our growth effectively, the development and production of our products or product candidates could be
delayed or curtailed. Additional investments may be needed if changes in our manufacturing process lead to
required changes in our infrastructure.
Our COVID-19 vaccine and certain of our product candidates rely on the availability of specialty raw
materials, which may not be available to us on acceptable terms or at all.
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Our product candidates require many specialty raw materials, some of which are manufactured by small
companies with limited resources and experience to support a commercial product, and suppliers may not be
able to deliver raw materials to our specifications. In addition, some such suppliers normally support blood-based
hospital businesses and generally do not have the capacity to support commercial products manufactured under
GMP by biopharmaceutical firms. These suppliers may be ill-equipped to support our needs, especially in non-
routine circumstances like an FDA inspection or medical crisis, such as widespread contamination. We also do
not have contracts with many of these suppliers, and we may not be able to contract with them on acceptable
terms or at all. Accordingly, we have experienced and we may in the future experience delays in receiving key
raw materials to support clinical or commercial manufacturing.
In addition, some raw materials are currently available from a single supplier, or a small number of suppliers. We
cannot be sure that these suppliers will remain in business or that they will not be purchased by one of our
competitors or another company that is not interested in continuing to produce these materials for our intended
purpose. In addition, the lead time needed to establish a relationship with a new supplier can be lengthy, and we
may experience delays in meeting demand in the event we must switch to a new supplier. The time and effort to
qualify a new supplier could result in additional costs, diversion of resources or reduced manufacturing yields,
any of which would negatively impact our operating results. Further, we may be unable to enter into agreements
with a new supplier on commercially reasonable terms or at all, which could have a material adverse impact on
our business.
We are subject to significant regulatory oversight with respect to manufacturing our products and
product candidates. Our manufacturing facilities or the manufacturing facilities of our third-party
manufacturers or suppliers may not meet regulatory requirements. Failure to meet GMP requirements
set forth in regulations promulgated by the FDA, the EMA and other comparable regulatory authorities
could result in significant delays in and costs of our products.
The manufacturing of immunotherapies for clinical trials or commercial sale is subject to extensive regulation.
GMP requirements govern manufacturing processes and procedures, including record-keeping, and the
implementation and operation of quality systems to control and assure the quality of products and materials used
in our products and product candidates. Poor control of the GMP production processes can lead to product
quality failures that can impact our ability to supply product, resulting in loss of potential product sales revenue,
cost overruns and delays to clinical timelines for our clinical programs, which could be extensive. Such
production process issues include but are not limited to:
–critical deviations in the manufacturing process;
–facility and equipment failures;
–contamination of the product due to an ineffective quality control strategy;
–facility contamination as assessed by the facility and utility environmental monitoring program;
–ineffective process, equipment or analytical change management, resulting in failed lot release criteria;
–raw material failures due to ineffective supplier qualification or regulatory compliance issues at critical
suppliers;
–ineffective product stability;
–failed lot release or facility and utility quality control testing;
–ineffective corrective actions or preventative actions taken to correct or avoid critical deviations due to our
developing understanding of the manufacturing process as we scale; and
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–failed or defective components or consumables.
We must supply all necessary documentation in support of a BLA or other marketing authorization application on
a timely basis and must adhere to the FDA’s, the EMA’s and other countries’ GMP requirements, which are
enforced, in the case of the FDA, in part through its facilities inspection program.
Regulatory authorities typically require representative manufacturing site inspections to assess adequate
compliance with GMPs and manufacturing controls as described in the filing. If either we or one of our third-party
manufacturing sites fail to provide sufficient quality assurance or control, approval to continue delivery of our
commercial product or to commercialize our product candidates may not be granted. Inspections by regulatory
authorities may be announced or unannounced and may occur at any time during the development or
commercialization phase. The inspections may be product-specific or facility-specific for broader GMP
inspections, or as a follow up to market or development issues that the regulatory agency may identify. Deficient
inspection outcomes may result in adverse regulatory action, including the issuance of untitled or warning letters,
which could influence our ability, or the ability of our third-party manufacturers or suppliers, to fulfill supply
obligations, impacting or delaying supply or delaying programs. Our failure, or the failure of our third-party
manufacturers, to comply with applicable regulations could result in sanctions being imposed on us, including,
but not limited to, clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals,
license revocation, seizures or recalls of product candidates or products, operating restrictions, and criminal
prosecutions, any of which could significantly and adversely affect supplies of our products and product
candidates (including those of our collaborators) and our overall business operations.
The manufacturing process for any product is subject to the FDA’s, the EMA’s and other regulatory authorities’
approval processes, and we may need to contract with manufacturers whom we believe can meet applicable
regulatory authority requirements on an ongoing basis. If we or our third-party manufacturers are unable to
reliably manufacture to specifications acceptable to the FDA, the EMA or other regulatory authorities, we or our
collaborators may not obtain or maintain the approvals we or they need to release and deliver such products.
Even if we or our collaborators obtain regulatory approval for any of our immunotherapies, there is no assurance
that either we or our CMOs will be able to manufacture our product candidates to specifications acceptable to
the FDA, the EMA or other regulatory authorities, to produce it in sufficient quantities to meet the requirements
for the potential launch of the product, or to meet potential future demand. Any of these challenges could delay
completion of clinical trials, require bridging clinical trials or the repetition of one or more clinical trials, increase
clinical trial costs, delay approval of our product candidates, impair commercialization efforts or increase our cost
of goods. The occurrence of any of the foregoing could have an adverse effect on our business, financial
condition, results of operations and growth prospects.
In addition, we may not have direct control over the ability of our CMOs to maintain adequate quality control,
quality assurance and qualified personnel. Furthermore, all of our CMOs are engaged with other companies to
supply or manufacture materials or products for such companies, which exposes our CMOs to regulatory risks
for the production of such materials and products. As a result, failure to meet the regulatory requirements for the
production of those materials and products may generally affect the regulatory status of our CMOs’ facilities, and
could result in the sanctions and other adverse outcomes described above. Our potential future dependence
upon others for the manufacture of our products, product candidates and raw materials may adversely affect our
future operating results and our ability to commercialize any products that receive regulatory approval on a
timely and competitive basis.
The FDA, the EMA and other regulatory authorities may require us to submit product samples of any lot of any
approved product together with the protocols showing the results of applicable tests at any time. Under some
circumstances, the FDA or other regulatory authorities may require that we do not distribute a lot or lots until the
relevant agency authorizes such release. Deviations in the manufacturing process, including those affecting
quality attributes and stability, may result in unacceptable changes in the product that could result in lot failures
or product recalls. Our CMOs have, in the past, experienced lot failures and some may have experienced
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product recalls. Lot failures or product recalls with respect to product produced by either our own facilities or
those of our third-party manufacturers could cause us and our collaborators to delay clinical trials, product
launches or product supply, which could be costly to us and otherwise harm our business, financial condition,
results of operations and prospects.
We also may encounter problems hiring and retaining the experienced scientific, quality-control and
manufacturing personnel needed to operate our manufacturing processes and operations, which could result in
delays in production or difficulties in maintaining compliance with applicable regulatory requirements. While we
train and qualify all personnel around the appropriate handling of our products and materials, we may not be
able to control for or ultimately detect intentional sabotage or negligence by any employee or contractor.
Risks Related to our Reliance on Third Parties
We rely on third parties in the conduct of significant aspects of our preclinical studies and clinical trials
and intend to rely on third parties in the conduct of future clinical trials. If these third parties do not
successfully carry out their contractual duties, fail to comply with applicable regulatory requirements or
fail to meet expected deadlines, we may be unable to obtain regulatory approval for our product
candidates.
We currently rely, and expect to continue to rely, on third parties, such as CROs, clinical data management
organizations, collaborators, medical institutions and clinical investigators, to conduct various and significant
elements of our clinical trials. Furthermore, we currently rely, and expect to continue to rely, on third parties to
conduct certain research and preclinical testing activities. In some cases, these third parties may terminate their
engagements with us. If we need to enter into alternative arrangements, it would delay our discovery or product
development activities.
Our reliance on these third parties for research and development activities will reduce our control over these
activities but will not relieve us of our regulatory or contractual responsibilities. We are responsible for ensuring
that each of our preclinical studies and clinical trials is conducted in accordance with the applicable protocol,
legal and regulatory requirements and scientific standards. For example, we are responsible for ensuring that
each of our clinical trials is conducted in accordance with the general investigational plan and protocols for the
trial.
Moreover, the FDA requires us to comply with GCP for conducting, recording and reporting the results of clinical
trials to assure that data and reported results are credible and accurate and that the rights, integrity and
confidentiality of trial participants are protected. We are also required to register ongoing clinical trials and post
the results of completed clinical trials on a U.S. government-sponsored database, ClinicalTrials.gov, within
certain timeframes. Failure to do so can result in fines, adverse publicity, and civil and criminal sanctions. For
any violations of laws and regulations during the conduct of our preclinical studies and clinical trials, we could be
subject to warning letters or enforcement action that may include civil penalties up to and including criminal
prosecution.
We and our CROs are required to comply with regulations, including GCP, for conducting, monitoring, recording
and reporting the results of preclinical studies and clinical trials to ensure that the data and results are
scientifically credible and accurate and that the trial participants are adequately informed, among other things, of
the potential risks of participating in clinical trials. We are also responsible for ensuring that the rights of our
clinical trial participants are protected. These regulations are enforced by the FDA, the regulatory authorities of
the EU member states, and comparable regulatory authorities of other jurisdictions for any product candidates in
clinical development. The FDA enforces GCP regulations through periodic inspections of clinical trial sponsors,
principal investigators and trial sites. If we or our CROs fail to comply with applicable GCP, the clinical data
generated in our clinical trials may be deemed unreliable and the FDA or comparable regulatory authorities of
other jurisdictions may require us to perform additional clinical trials before approving our marketing applications.
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We cannot be sure that, upon inspection, the FDA will determine that any of our future clinical trials will comply
with GCP. In addition, our clinical trials must be conducted with product candidates produced in accordance with
the requirements of GMP regulations. Our failure or the failure of our CROs to comply with these regulations may
require us to repeat clinical trials, which would delay the regulatory approval process and could also subject us
to enforcement action.
Although we have designed, and in the future intend to design the clinical trials for certain of our product
candidates, our collaborators will design the clinical trials that they are managing (in some cases, with our input)
and in the case of clinical trials controlled by us, we expect that CROs will conduct all of the clinical trials. As a
result, many important aspects of our development programs, including their conduct and timing, are outside of
our direct control. Our reliance on third parties to conduct future preclinical studies and clinical trials results in
less direct control over the management of data developed through preclinical studies and clinical trials than
would be the case if we were relying entirely upon our own staff. Communicating with outside parties can also
potentially lead to mistakes as well as difficulties in coordinating activities. Outside parties may:
–have staffing difficulties;
–fail to comply with contractual obligations;
–experience regulatory compliance issues;
–undergo changes in priorities or become financially distressed;
–form relationships with other entities, some of which may be our competitors;
–make human errors; or
–be subject to cyberattacks.
These factors may materially adversely affect the willingness or ability of third parties to conduct our preclinical
studies and clinical trials and may subject us to unexpected cost increases that are beyond our control. If the
CROs do not perform preclinical studies and clinical trials in a satisfactory manner, breach their obligations to us
or fail to comply with regulatory requirements, the development, regulatory approval and commercialization of
our product candidates may be delayed, we may not be able to obtain regulatory approval and commercialize
our product candidates, or our development programs may be materially and irreversibly harmed. If we are
unable to rely on preclinical and clinical data collected by our CROs, we could be required to repeat, extend the
duration of, or increase the size of any clinical trials we conduct and this could significantly delay
commercialization and require significantly greater expenditures.
We also rely on other third parties to transport, store and distribute the required materials for our clinical trials. In
the past, certain of our third-party vendors have mishandled our materials, resulting in loss of full or partial lots of
material. Any further performance failure on the part of these third parties could result in damaged products and
could delay clinical development or marketing approval of any product candidates we may develop or
commercialization of our medicines, if approved, producing additional losses and depriving us of potential
product sales revenue, causing us to default on our contractual commitments, result in losses that are not
covered by insurance, and damage our reputation and overall perception of our products in the marketplace.
Our existing collaborations, or any future collaboration arrangements that we may enter into, may not be
successful, which could significantly limit the likelihood of receiving the potential economic benefits of
the collaboration and adversely affect our ability to develop and commercialize our products and
product candidates.
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We have entered into collaborations under which our collaborators have provided, and may in the future provide,
funding and other resources for developing and commercializing our products and product candidates. We
expect to enter into additional collaborations to access additional funding, capabilities and/or expertise in the
future. Our existing collaborations, and any future collaborations we enter into, may pose a number of risks,
including the following:
–collaborators may not perform or prioritize their obligations as expected;
–the clinical trials conducted as part of such collaborations may not be successful;
–collaborators may not pursue development and commercialization of any product candidates and products
that achieve regulatory approval or may elect not to continue or renew development or commercialization of
programs based on clinical trial results, changes in the collaborators’ focus or available funding (for example,
we are aware that there have been allegations that Fosun International Ltd., an affiliate of our collaboration
partner Fosun Pharma, is facing liquidity risks), or external factors, such as an acquisition, that divert
resources or create competing priorities;
–collaborators may delay clinical trials, provide insufficient funding for clinical trials, stop a clinical trial, abandon
a product candidate, repeat or conduct new clinical trials, or require a new formulation of a product candidate
for clinical testing;
–collaborators could independently develop, or develop with third parties, products that compete directly or
indirectly with our product candidates if the collaborators believe that competitive products are more likely to
be successfully developed or can be commercialized under terms that are more economically attractive than
ours;
–product candidates developed in collaborations with us may be viewed by our collaborators as competitive
with their own product candidates or products, which may cause collaborators to cease to devote resources to
the development or commercialization of our product candidates;
–a collaborator with marketing and distribution rights to one or more of our product candidates that achieve
regulatory approval may not commit sufficient resources to the marketing and distribution of any such product;
–disagreements with collaborators, including disagreements over proprietary rights, contract interpretation or
the preferred course of development of any product candidates, may cause delays or termination of the
research, development or commercialization of such product candidates, may lead to additional
responsibilities for us with respect to such product candidates, or may result in litigation or arbitration, any of
which would be time-consuming and expensive;
–collaborators may not properly maintain, protect, defend or enforce our intellectual property rights or may use
our proprietary information in such a way as to invite litigation that could jeopardize or invalidate our
intellectual property or proprietary information or expose us to potential litigation;
–disputes may arise with respect to the ownership of intellectual property developed pursuant to our
collaborations;
–collaborators may infringe, misappropriate or otherwise violate the intellectual property rights of third parties,
which may expose us to litigation and potential liability;
–collaborations may be terminated for the convenience of the collaborator and, if terminated, the development
of our product candidates may be delayed, and we could be required to raise additional capital to pursue
further development or commercialization of the applicable product candidates;
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–future relationships may require us to incur non-recurring and other charges, increase our near- and long-term
expenditures, issue securities that dilute our existing shareholders, or disrupt our management and business;
–we could face significant competition in seeking appropriate collaborators, and the negotiation process is time-
consuming and complex; and
–our international operations through any future collaborations, acquisitions or joint ventures may expose us to
certain operating, legal and other risks not encountered in Germany or the United States.
If our collaborations do not result in the successful development and commercialization of programs, or if one of
our collaborators terminates its agreement with us, we may not receive any future research funding or milestone,
earn-out, royalty or other contingent payments, or otherwise yield the expected benefits under the collaborations.
As a result, our development of product candidates and commercialization efforts could be delayed and we may
need additional resources to develop and commercialize our product candidates. If one of our collaborators
terminates its agreement with us, we may find it more difficult to attract new collaborators and the perception of
us in the business and financial communities could be adversely affected. All of the risks relating to product
development, regulatory approval and commercialization described in this report apply to the activities of our
collaborators.
If we are not able to establish collaborations on commercially reasonable terms, we may have to alter
our research, development and commercialization plans.
Our research and product development programs and the potential commercialization of any product candidates
we develop alone or with collaborators will require substantial additional cash to fund expenses, and we expect
that we will continue to seek collaborative arrangements with others in connection with the development and
potential commercialization of current and future product candidates or the development of ancillary
technologies. We face significant competition in establishing relationships with appropriate collaborators. 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. Whether or not we reach a
definitive agreement for a collaboration will depend, among other things, upon our assessment of the
collaborator’s resources and expertise, the terms and conditions of the proposed collaboration and the proposed
collaborator’s evaluation of a number of factors. Those factors may include, among other things and as
applicable for the type of potential product or technology, an assessment of the opportunities and risks of our
technology, the design or results of studies or trials, the likelihood of approval, if necessary, of the FDA or
comparable regulatory authorities outside the United States, the potential market for the subject product
candidate, the costs and complexities of manufacturing and delivering such product candidate to patients, the
potential of competing products and technologies and industry and market conditions generally.
Current or future collaborators may also consider alternative product candidates or technologies for similar
indications that may be available to collaborate on and whether such a collaboration could be more attractive
than the one with us. Additionally, we may be restricted under existing collaboration agreements from entering
into future agreements on certain terms or for certain development activities with potential collaborators. For
example, we have granted exclusive rights or options to Pfizer for certain targets, and under the terms of our
respective collaboration agreements with them, we will be restricted from granting rights to other parties to use
our mRNA technology to pursue potential products that address those targets. Similarly, our collaboration
agreements have in the past and may in the future contain non-competition provisions that could limit our ability
to enter into collaborations with future collaborators.
Collaborations are complex and time-consuming to negotiate and document. We may not be able to negotiate
collaborations on a timely basis, on acceptable terms, or at all. If we do enter into additional collaboration
agreements, the negotiated terms may force us to relinquish rights that diminish our potential profitability from
development and commercialization of the subject product candidates or others. If we are unable to enter into
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additional collaboration agreements, we may have to curtail the research and development of the product
candidate or technology for which we are seeking to collaborate, reduce or delay research and development
programs, delay potential commercialization timelines, reduce the scope of any sales or marketing activities or
undertake research, development or commercialization activities at our own expense. If we elect to increase our
expenditures to fund research, development or commercialization activities on our own, we may need to obtain
additional capital, which may not be available to us on acceptable terms or at all.
We have entered into in-licensing arrangements and may form or seek to enter into additional licensing
arrangements in the future, and we may not realize the benefits of such licensing arrangements.
We are a party to licenses that give us rights to third-party intellectual property, including patents and patent
applications, that are necessary or useful for our business. For example, we have obtained licenses from Acuitas
Therapeutics Inc., or Acuitas, CellScript LLC, or CellScript, and its affiliate, mRNA RiboTherapeutics, Inc., to
patent rights claiming certain uses of modified RNA, as well as licenses from certain other parties for intellectual
property useful in pharmaceutical formulations. We may enter into additional licenses to third-party intellectual
property in the future.
The success of products developed based on in-licensed technology will depend in part on the ability of our
current and future licensors to prosecute, obtain, maintain, protect, enforce and defend patent protection for our
in-licensed intellectual property. Our current and future licensors may not successfully prosecute the patent
applications we license. Even if patents were issued in respect of these patent applications, our licensors may
fail to maintain these patents, may determine not to pursue litigation against other companies that are infringing
these patents, or may pursue such litigation less aggressively than we would. Without protection for the
intellectual property we license, other companies might be able to offer substantially identical products for sale,
which could adversely affect our competitive business position and harm our business prospects. In addition, we
sublicense our rights under various third-party licenses to our collaborators. Any impairment of these sublicensed
rights could result in reduced revenues under our collaboration agreements or result in termination of an
agreement by one or more of our collaborators.
Disputes may also arise between us and our licensors regarding intellectual property subject to a license
agreement, including:
–the scope of rights granted under the license agreement and other interpretation-related issues;
–whether and the extent to which our technology and processes infringe, misappropriate or otherwise violate
the intellectual property of the licensor that is not subject to the licensing agreement;
–our right to sublicense patent and other intellectual property rights to third parties under collaborative
relationships;
–our diligence obligations with respect to the use of the licensed intellectual property and technology in relation
to our development and commercialization of our product candidates, and what activities satisfy those
diligence obligations;
–the ownership of inventions, trade secrets, know-how and other intellectual property resulting from the joint
creation or use of intellectual property by our licensors and us and our collaborators;
–the priority of invention of patented technology; and
–the amounts to be paid pursuant to certain program milestones being achieved or to royalty obligations,
including the triggering of royalty obligations and amounts to be paid pursuant thereto.
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If disputes over intellectual property that we have in-licensed or other related contractual rights prevent or impair
our ability to maintain our current licensing arrangements on favorable terms, we may be unable to successfully
develop and commercialize the affected product candidates.
We are generally also subject to all of the same risks with respect to protection of intellectual property that we
license, as we are for intellectual property that we own, which are described below. If we, our co-owners or our
licensors fail to adequately protect, defend, maintain or enforce this intellectual property, our ability to
commercialize products could suffer.
We and our collaborators rely on third parties to manufacture certain of our clinical product supplies,
and we may have to rely on third parties to produce and process our product candidates, if approved.
Although we expect to continue using our own clinical manufacturing facilities where available, we also rely on
outside vendors to manufacture supplies and process our product candidates. We only manufacture our
COVID-19 vaccine on a commercial scale and may not be able to achieve commercial-scale manufacturing and
processing for our other product candidates, if approved, and may be unable to create an inventory of mass-
produced, off-the-shelf product to satisfy demands for our product candidates, if approved.
We do not yet have sufficient information to reliably estimate the cost of the commercial manufacturing and
processing of our product candidates, and the actual cost to manufacture and process our product candidates
could materially and adversely affect the commercial viability of our product candidates. As a result, we may not
be able to develop commercially viable products other than our COVID-19 vaccine.
In addition, our reliance on a limited number of CMOs exposes us to the following risks:
–we may be unable to identify manufacturers on acceptable terms or at all because the number of potential
manufacturers is limited and the FDA or other regulatory authorities may have questions regarding any
replacement contractor. This may require new testing and regulatory interactions. In addition, a new
manufacturer would have to be educated in, or develop substantially equivalent processes for, production of
our products after receipt of regulatory authority questions, if any;
–our CMOs might be unable to timely formulate and manufacture our product or produce the quantity and
quality required to meet our clinical and commercial needs, if any;
–CMOs may not be able to execute our manufacturing procedures appropriately;
–our future CMOs may not perform as agreed or may not remain in the contract manufacturing business for the
time required to supply our clinical trials or to successfully produce, store and distribute our products;
–manufacturers are subject to ongoing periodic unannounced inspection by the FDA, the U.S. Drug
Enforcement Administration and corresponding state agencies and by regulatory authorities in other
jurisdictions to ensure strict compliance with GMP and other government regulations and corresponding
standards in other jurisdictions. We do not have control over CMOs’ compliance with these regulations and
standards;
–we may not own, or may have to share, the intellectual property rights to any improvements made in the
manufacturing process for our products;
–our CMOs could breach or terminate their agreement with us; and
–our CMOs would also be subject to the same risks we face in developing our own manufacturing capabilities,
as described above.
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Each of these risks could delay our clinical trials, the approval, if any, of our COVID-19 vaccine or product
candidates by the FDA or regulatory authorities in other jurisdictions or the commercialization of our COVID-19
vaccine or product candidates, or result in higher costs or deprive us of potential product sales revenue. In
addition, we will rely on third parties to perform release tests on our COVID-19 or our product candidates prior to
delivery to patients. If these tests are not appropriately done and test data are not reliable, patients could be put
at risk of serious harm.
We and certain of our collaborators currently rely on CMOs located outside of the United States to manufacture
clinical materials. Such ex-U.S. CMOs may be subject to or affected by U.S. legislation, executive orders,
regulations, or investigations, including but not limited to the recently enacted BIOSECURE Act, the Department
of Justice’s Final Rule issued on January 8, 2025 implementing the Executive Order on Preventing Access to
Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern,
sanctions, trade restrictions and other U.S. and other regulatory requirements, which could increase the cost or
reduce the supply of material available to us, delay or restrict the procurement or supply of such material, delay
or impact clinical trials, have an adverse effect on our ability to secure significant commitments from
governments to purchase our potential therapies and adversely affect our financial condition and business
prospects.
We are dependent on single source suppliers for some of the components and materials used in, and the
processes required to develop, our COVID-19 vaccine and our product candidates.
We currently depend on single source suppliers for some of the components and materials used in, and
manufacturing processes required to develop, our COVID-19 vaccine and our product candidates. We cannot
ensure that these suppliers or service providers will remain in business, or have sufficient capacity or supply to
meet our needs, or that they will not be purchased by one of our competitors or another company that is not
interested in continuing to work with us. Our use of single source suppliers of raw materials, components, key
processes and finished goods exposes us to several risks, including disruptions in supply, price increases or late
deliveries. There are, in general, relatively few alternative sources of supply for substitute components. These
vendors may be unable or unwilling to meet our future demands for our clinical trials or commercial sale.
Establishing additional or replacement suppliers for these components, materials and processes could take a
substantial amount of time and it may be difficult to establish replacement suppliers who meet regulatory
requirements. Any disruption in supply from any single source supplier or service provider could lead to supply
delays or interruptions which would damage our business, financial condition, results of operations and
prospects.
If we have to switch to a replacement supplier, the manufacture and delivery of our product candidates could be
interrupted for an extended period, which could adversely affect our business. Establishing additional or
replacement suppliers for any of the components or processes used in our COVID-19 vaccine and our product
candidates, if required, may not be accomplished quickly. If we are able to find a replacement supplier, the
replacement supplier would need to be qualified and may require additional regulatory authority approval, which
could result in further delay. While we seek to maintain adequate inventory of the single source components and
materials used in our COVID-19 vaccine and our product candidates, any interruption or delay in the supply of
components or materials, or our inability to obtain components or materials from alternate sources at acceptable
prices in a timely manner, could impair our ability to meet the demand for our COVID-19 vaccine and product
candidates.
In addition, as part of the FDA’s approval of our product candidates, we will also require FDA review of the
individual components of our process, which include the manufacturing processes and facilities of our single
source suppliers.
Our reliance on these suppliers, service providers and manufacturers subjects us to a number of risks that could
harm our reputation, business and financial condition, including, among other things:
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–delays to the development timelines for our product candidates;
–interruption of supply resulting from modifications to or discontinuation of a supplier’s operations;
–delays in product shipments resulting from uncorrected defects, reliability issues, or a supplier’s variation in a
component;
–a lack of long-term supply arrangements for key components with our suppliers;
–inability to obtain adequate supply in a timely manner, or to obtain adequate supply on commercially
reasonable terms;
–difficulty and cost associated with locating and qualifying alternative suppliers for our components in a timely
manner;
–production delays related to the evaluation and testing of components from alternative suppliers, and
corresponding regulatory qualifications;
–delay in delivery due to our suppliers’ prioritizing other customer orders over ours;
–damage to our reputation caused by defective components produced by our suppliers; and
–fluctuation in delivery by our suppliers due to changes in demand from us or their other customers.
If any of these risks materialize, costs could significantly increase and our ability to meet demand for our
products could be impacted.
Risks Related to Intellectual Property
If our efforts to obtain, maintain, protect, defend and/or enforce the intellectual property related to our
COVID-19 vaccine or our product candidates and technologies are not adequate, we may not be able to
compete effectively in our market.
Our commercial success depends in part on our ability to obtain, maintain, protect, defend and enforce patent
and other intellectual property, including trade secret and know-how, protection for our COVID-19 vaccine and
for our product candidates, proprietary technologies and their uses, as well as our ability to operate, develop,
manufacture and commercialize our COVID-19 vaccine or one or more of our product candidates without
infringing, misappropriating or otherwise violating the intellectual property or other proprietary rights of our
competitors or any other third parties, including any non-practicing entities or patent assertion entities. We
generally seek to protect our intellectual property position by filing and/or licensing patent applications in the
European Union, the United States and elsewhere related to our product candidates, proprietary technologies
(including methods of manufacture) and their uses that are important to our business. Our patent applications
cannot be enforced against third parties practicing the technology claimed in such applications unless, and until,
patents issue from such applications, and then only to the extent that the issued claims cover third parties’
activities in the countries in which they are performed. We cannot be certain that the claims in any of our patent
applications will be considered patentable by the United States Patent and Trademark Office, or the USPTO,
courts in the United States or the patent offices and courts in other jurisdictions, including Europe, nor can we be
certain that any claim in our issued patents will not be found invalid or unenforceable if challenged. Accordingly,
there can be no assurance that our patent applications or those of our licensors will result in additional patents
being issued or that issued patents will adequately cover our COVID-19 vaccine or our product candidates, or
otherwise afford sufficient protection against competitors with similar technology, nor can there be any assurance
that issued patents will not be infringed, designed around, invalidated or held unenforceable. Furthermore, we
may not be able to apply for patents on certain aspects of our current or future products or product candidates,
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proprietary technologies and their uses in a timely fashion, at a reasonable cost, in all jurisdictions, or at all, and
any potential patent protection we obtain may not be sufficient to prevent substantial competition.
Even claims of issued patents may later be found invalid or unenforceable, or may be modified or revoked in
proceedings before various patent offices or in courts in the United States, Europe or other jurisdictions. The
degree of future protection for our intellectual property and other proprietary rights is uncertain. Only limited
protection may be available and may not adequately protect our rights or permit us to gain or keep any
competitive advantage. If we do not adequately obtain, maintain, protect, defend and enforce our intellectual
property and proprietary technology, competitors may be able to use our products, product candidates and
proprietary technologies and erode or negate any competitive advantage we may have, which could have a
material adverse effect on our financial condition and results of operations.
The patent application process is subject to numerous risks and uncertainties, and there can be no assurance
that we or any of our current or future licensors or collaborators will be successful in prosecuting, obtaining,
protecting, maintaining, enforcing or defending patents and patent applications necessary or useful to protect our
products or product candidates, proprietary technologies (including methods of manufacture) and their uses.
These risks and uncertainties include, from time to time, the following:
–the USPTO and various other governmental patent agencies require compliance with a number of procedural,
documentary, fee payment and other provisions during the patenting process, the noncompliance with which
can result in abandonment or lapse of a patent or patent application or a finding that a patent is
unenforceable, and partial or complete loss of patent rights in the relevant jurisdiction;
–patent applications may not result in any patents being issued;
–claims of issued patents that we own (solely or jointly) or have in-licensed may be challenged, invalidated,
modified, revoked, circumvented, found to be unenforceable or otherwise may not provide any competitive
advantage;
–other parties may have designed around our patent claims or developed technologies that may be related or
competitive to our COVID-19 vaccine or to our product candidates or other technologies, may have filed or
may file patent applications and may have received or may receive patents that overlap or conflict with our
patent filings, either by claiming the same or overlapping methods, products, reagents, tools or devices or by
claiming subject matter that could dominate one or more of our patent claims;
–any successful opposition to claims of any patents owned by or in-licensed to us could deprive us of rights
necessary for the development and exploitation of our COVID-19 vaccine or our product candidates and other
technologies, or the successful commercialization of any product candidates and other technologies that we
may develop;
–because patent applications in the United States and most other jurisdictions are confidential for a period of
time after filing, we cannot be certain that we, our co-owners or our licensors were the first to file any patent
application related to our product candidates, proprietary technologies and their uses;
–a court or patent office proceeding, such as a derivative action or interference, can be provoked or instituted
by a third party or a patent office, and might determine that one or more of the inventions described in our
patent filings, or in those we licensed, was first invented by someone else, so that we may lose rights to such
invention(s);
–a court or other patent proceeding, such as an inter partes review, post grant review or opposition, can be
instituted by a third party to challenge the inventorship, scope, validity and/or enforceability of our patent
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claims and might result in invalidation or revision of one or more of our patent claims, or in a determination
that such claims are unenforceable;
–there may be significant pressure on the U.S. government and international governmental bodies to limit the
scope of patent protection both inside and outside the United States for disease treatments that prove
successful, as a matter of public policy regarding worldwide health concerns; existing legislation (for example,
in the United States, the Public Readiness and Emergency Preparedness Act, etc.) may be interpreted, and
new legislation may be passed, to permit third-party use of patented technologies relating to a public health
concern, with little or no compensation to the patent holder(s); and
–countries other than the United States may have patent laws less favorable to patentees than those upheld by
U.S. courts, allowing competitors a better opportunity to create, develop and market competing product
candidates.
The patent position of biopharmaceutical companies generally is highly uncertain, involves complex legal and
factual questions, and has been the subject of much litigation in recent years. The standards that the USPTO
and its counterparts use to grant patents are not always applied predictably or uniformly and can change.
Similarly, the ultimate degree of protection that will be afforded to biotechnology inventions, including ours, in the
United States and other countries, remains uncertain and is dependent upon the scope of the protection decided
upon by patent offices, courts and lawmakers. Moreover, there are periodic changes in patent law, as well as
discussions in the U.S. Congress and in other jurisdictions about modifying various aspects of patent law. There
is no uniform, worldwide policy regarding the subject matter and scope of claims granted or allowable in
pharmaceutical or biotechnology patents. In certain countries, for example, methods for the medical treatment of
humans are not patentable. More generally, the laws of some countries do not protect intellectual property rights
to the same extent as U.S. or EU laws, and those countries may lack adequate rules and procedures for
granting, maintaining, protecting, defending and enforcing our intellectual property rights.
Furthermore, the patent prosecution process is expensive and time-consuming, and we may not be able to file,
prosecute, maintain, protect, defend, enforce or license all necessary or desirable patents or patent applications,
as applicable, at a reasonable cost or in a timely manner. It is possible that we will fail to identify patentable
aspects of our research and development output in time to obtain patent protection. Although we enter into non-
disclosure and confidentiality agreements with parties who have access to confidential or patentable aspects of
our research and development output, such as our employees, corporate collaborators, outside scientific
collaborators, CROs, CMOs, consultants, advisors and other third parties, if any of these parties were to breach
such agreements and improperly disclose such output before a patent application is filed, this could jeopardize
our ability to seek patent protection. We also rely to a certain extent on trade secrets, know-how, and technology,
which are not protected by patents, to maintain our competitive position. If any trade secret, know-how or other
technology not protected by a patent were to be disclosed to or independently developed by a competitor, our
business and financial condition could be materially adversely affected.
The issuance of a patent is not conclusive as to its inventorship, priority date, scope, term, validity or
enforceability so that any patents that may issue or that we may license may be challenged in the courts or
patent offices in the United States, Europe and other jurisdictions. Once granted, patents may remain open to a
variety of challenges, including opposition, interference, re-examination, post-grant review, inter partes review,
nullification or derivation action in court or before patent offices or similar proceedings, and furthermore, may be
challenged as a defense in any enforcement action that we might bring. Such challenges may result in loss of
exclusivity or in patent claims being narrowed, terminated, disclaimed, invalidated, assigned to others or held
unenforceable, any or all of which could limit our ability to stop others from using or commercializing similar or
identical products, or limit the scope and/or term of patent protection of our products and product candidates
and/ or eliminate it altogether, thus hindering or removing our ability to limit third parties from making, using or
selling products or technologies that are similar or identical to ours, and/or reduce or eliminate royalty payments
to us from our licensees. Given the amount of time required for the development, testing and regulatory review of
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new product candidates, patents protecting such candidates might expire before or shortly after such candidates
are commercialized. Furthermore, our pending and future patent applications may not result in patents being
issued which protect our technology or our product(s) or product candidates, or which effectively prevent others
from commercializing competitive technologies and products. As a result, our intellectual property may not
provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.
Our ability to enforce our owned and in-licensed patent and other intellectual property rights depends on our
ability to detect infringement, misappropriation and other violation of such patents and other intellectual property.
It may be difficult to detect infringers, misappropriators and other violators who do not advertise the components
or methods that are used in connection with their products and services. Moreover, it may be difficult or
impossible to obtain evidence of infringement, misappropriation or other violation in a competitor’s or potential
competitor’s product or service, and in some cases we may not be able to introduce obtained evidence into a
proceeding or otherwise utilize it to successfully demonstrate infringement. We may not prevail in any lawsuits
that we initiate and the damages or other remedies awarded if we were to prevail may not be commercially
meaningful.
Furthermore, patents or other intellectual property rights that we may be able to secure for our COVID-19
vaccine or our other COVID-19 vaccine candidates could be restricted or preempted if governments determine
that they will not enforce, or will require compulsory licensing of, technologies useful to address the spread of
COVID-19.
In addition, proceedings to enforce or defend our owned or in-licensed patents could put our patents at risk of
being invalidated, held unenforceable or interpreted narrowly. Such proceedings could also provoke third parties
to assert claims against us, including that some or all of the claims in one or more of our patents are invalid or
otherwise unenforceable. Such challenges may result in loss of patent rights, loss of exclusivity, or in patent
claims being narrowed, invalidated or held unenforceable, which could limit our ability to stop others from using
or commercializing similar or identical technology and products, or limit the duration of the patent protection of
our technology and product candidates. If any of our owned or in-licensed patents covering our product
candidates or other technologies are narrowed, invalidated or found unenforceable, or if a court found that valid,
enforceable patents held by third parties covered one or more of our product candidates or other technologies,
our competitive position could be harmed or we could be required to incur significant expenses to protect,
enforce or defend our rights. If we initiate lawsuits to protect, defend or enforce our patents, or litigate against
third-party claims, such proceedings would be expensive and would divert the attention of our management,
technical personnel, and other employees even if the eventual outcome is favorable to us.
The degree of future protection for our intellectual property and other proprietary rights is uncertain, and we
cannot ensure that:
–any of our patents, or any of our pending patent applications, if issued, or those of our licensors, will include
claims having a scope sufficient to protect our product(s), our product candidates and other technologies;
–any of our pending patent applications or those of our licensors may issue as patents;
–others will not or may not be able to make, use, offer to sell or sell products that are the same as or similar to
our own but that are not covered by the claims of the patents that we own or license;
–we will be able to successfully commercialize our products on a substantial scale, if approved, before the
relevant patents that we own or license expire;
–we were the first to make the inventions covered by each of the patents and pending patent applications that
we own or license;
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–we, our co-owners or our licensors were the first to file patent applications for these inventions;
–others will not develop similar or alternative products or technologies that do not infringe the patents we own
or license;
–any of the claims of patents we own or license will be found to ultimately be valid and enforceable;
–any patents issued to us or our licensors will provide a basis for an exclusive market for our commercially
viable product candidates and other technologies or will provide us with any competitive advantages;
–a third party may not challenge the claims of patents we own or license and, if challenged, a court would hold
that such patent claims are valid, enforceable and infringed;
–we may develop or in-license additional proprietary technologies that are patentable;
–the patents of others will not have an adverse effect on our ability to issue patents, or otherwise on our
business;
–our competitors do not conduct research, development, testing or commercialization activities in countries
where we do not have enforceable patent rights and then use the information learned from such activities to
develop competitive products for sale in our major commercial markets;
–we will develop additional proprietary technologies, product(s) or product candidates that are separately
patentable; and
–our, or our collaborators’, development and commercialization activities, including our manufacturing
processes, or products will not infringe patents of our competitors or any other third parties, including any non-
practicing entities or patent assertion entities.
Other companies or organizations may challenge our intellectual property rights or the intellectual
property rights of our partners or may assert intellectual property rights that prevent us or our partners
from developing and commercializing our COVID-19 vaccine or our product candidates and other
technologies.
We practice in new and evolving scientific fields, the continued development and potential use of which has
resulted in many different patents and patent applications from organizations and individuals seeking to obtain
intellectual property protection in the fields. We own and in-license patent applications and issued patents that
describe and/or claim certain technologies, including products, reagents, formulations, tools and methods
including uses and manufacturing methods, or features or aspects of any of these. These issued patents and
pending patent applications claim certain compositions of matter and methods relating to the discovery,
development, testing, manufacture and commercialization of therapeutic modalities and our delivery
technologies, including lipid nanoparticles, or LNPs. If we, our co-owners or our licensors are unable to obtain,
maintain, protect, defend or enforce patent protection with respect to our products, product candidates and other
technology and any other products, product candidates and technology that we may develop, our business,
financial condition, results of operations and prospects could be materially harmed.
As the scientific fields mature, our known competitors and other third parties, many of whom have substantially
greater resources than we do and many of whom have made significant investments in competing technologies,
may seek or may have already obtained patents, and they have filed and will continue to file patent applications
claiming inventions in the fields in the United States and elsewhere. This may limit, interfere with or eliminate our
and our partners’ ability to make, use, sell, import or otherwise exploit our COVID-19 vaccine or our product
candidates or other technologies. There is uncertainty about which patents will issue, and, if they do, as to when,
to whom and with what claims. With respect to both in-licensed and owned intellectual property, we cannot
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predict whether the patent applications we and our licensors are currently pursuing will issue as patents in any
particular jurisdiction or whether the claims of any issued patents will provide sufficient protection from
competitors.
We, our co-owners, our partners or our licensors may in the future become a party to patent proceedings or
priority disputes in the United States, Europe or other jurisdictions. In the United States, the Leahy-Smith
America Invents Act, or the America Invents Act, includes a number of significant changes that affect the way
patent applications are prosecuted and also may affect patent litigation. These include allowing third-party
submission of prior art to the USPTO during patent prosecution and additional procedures to attack the validity of
a patent through USPTO-administered post-grant proceedings, including post-grant review, inter partes review
and derivation proceedings. We expect that our competitors and other third parties will institute litigation and
other proceedings, such as interference, reexamination and opposition proceedings, as well as inter partes and
post-grant review proceedings against us and the patents and patent applications that we own and in-license.
Additionally, we face ongoing COVID-19 vaccine-related patent litigation. We filed a nullity action in the Federal
Patent Court of Germany seeking a declaration that EP1857122B1, or EP’122, is invalid, initiated cancellation
actions against the CureVac IP in the German Patent and Trademark Office, and filed opposition proceedings in
the European Patent Office, or EPO, seeking the revocation of EP3708668B1, or EP’668, and EP4023755B1, or
EP’755. ModernaTX, Inc., or Moderna, has brought litigation against us and Pfizer regarding European patents
3590949B1, or EP’949, and 3718565B1, or EP’565, in Germany, England and Wales (only EP’949 currently at
issue), the Netherlands, Ireland, and Belgium, and regarding U.S. Patent Nos. 10,898,574, 10,702,600, and
10,933,127 in the United States. BioNTech and Pfizer also initiated proceedings seeking the revocation of
EP’949 in the Business and Property Courts of England and Wales and have filed opposition proceedings in the
EPO seeking the revocation of EP’949 and EP’565. BioNTech and Pfizer have filed petitions for inter partes
review before the Patent Trial and Appeal Board in the United States with respect to U.S. Patent Nos.
10,702,600 and 10,933,127. Arbutus Biopharma Corp., or Arbutus, and Genevant Sciences GmbH, or Genevant,
have brought litigation against us and Pfizer in the United States regarding U.S. Patent Nos. 9,504,651,
8,492,359, 11,141,378, 11,298,320, and 11,318,098. Promosome LLC, or Promosome, has initiated litigation
against us and Pfizer in the Unified Patent Court (Munich Division) regarding one European patent, EP 2 401
365. GlaxoSmithKline Biologicals SA and GlaxoSmithKline LLC, or collectively, GSK, have brought litigation
against us and Pfizer in the United States regarding U.S. Patent Nos. 11,638,693, 11,638,694, 11,666,534,
11,766,401, 11,786,467, 11,759,422, 11,655,475, and 11,851,660, and in the High Court of Ireland, as well as the
United Patent Court, regarding European Patent Nos. 2,590,626, 4,066,856, and 4,226,941. BioNTech and
Pfizer also initiated proceedings seeking the revocation of EP’626, EP’856, and EP’941 in the Business and
Property Courts of England and Wales and have filed opposition proceedings in the EPO seeking the revocation
of EP’856 and EP’941. Bayer CropScience LLC, or Bayer, Monsanto Company, and Monsanto Technology, LLC,
or Monsanto, have initiated litigation against us and Pfizer in the United States District Court for the District of
Delaware regarding one U.S. Patent No. 7,741,118. We cannot guarantee that we will not become subject to
additional COVID-19 vaccine patent infringement lawsuits in the future. In addition, should Pfizer not prevail in
any of the ongoing COVID-19 vaccine patent infringement lawsuits to which it is a party, Pfizer may seek to
require us to indemnify Pfizer for losses suffered therefrom as well as any losses from future COVID-19 vaccine
patent infringement lawsuits in which it does not prevail. We believe we have strong defenses against each of
these claims and intend to vigorously defend ourselves in each proceeding, but we can make no assurances
regarding the ultimate outcome of any of these matters. Additionally, as we continually evaluate these various
proceedings, we may from time to time make strategic decisions to settle or otherwise resolve certain
proceedings despite our continued belief in the strengths of our defenses.
We expect that we will continue to be subject to similar proceedings or priority disputes, including oppositions, in
Europe or other jurisdictions relating to patents and patent applications in our portfolio.
If we, our co-owners, our partners or our licensors are unsuccessful in any interference proceedings or other
priority or validity disputes, including any derivations, post-grant review, inter partes review or oppositions, to
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which we or they are subject, we may lose valuable intellectual property rights through the narrowing or loss of
one or more patents owned or in-licensed, or our owned or in-licensed patent claims may be narrowed,
invalidated or held unenforceable. In many cases, the possibility of appeal exists for either us or our opponents,
and it may be years before final, unappealable rulings are made with respect to these patents in certain
jurisdictions. The timing and outcome of these and other proceedings is uncertain and may adversely affect our
business if we are not successful in defending the patentability and scope of our pending and issued patent
claims. Even if our rights are not directly challenged, disputes could lead to the weakening of our intellectual
property rights. Our defense against any attempt by third parties to circumvent or invalidate our intellectual
property rights could be costly to us, could require significant time and attention of our management, technical
personnel and other employees and could have a material adverse impact on our business and our ability to
successfully compete against our current and future competitors.
There are many issued and pending patent filings that claim aspects of technologies that we may need for our
mRNA products or product candidates, or other product candidates, including patent filings that relate to relevant
delivery technologies. There are also many issued patents that claim targeting genes or portions of genes that
may be relevant for immunotherapies we wish to develop. In addition, as evidenced by the lawsuits brought
against Moderna, Pfizer and us, there may be additional issued and pending patent applications that may be
asserted against us in a court proceeding or otherwise based upon the asserting party’s belief that we may need
such patents for the development, manufacturing, testing and commercialization of our COVID-19 vaccine or of
our product candidates. Thus, it is possible that one or more organizations, ranging from our competitors to non-
practicing entities or patent assertion entities, has or will hold patent rights to which we may need a license, or
hold patent rights which could be asserted against us. Such licenses may not be available on commercially
reasonable terms or at all, or may be non-exclusive. If those organizations refuse to grant us a license to such
patent rights on reasonable terms, if we fail to invalidate relevant patents, or if a court or other governing body
determines that we need such patent rights that have been asserted against us and we are not able to obtain a
license on reasonable terms or at all, we may be unable to perform research and development or other activities
or market products covered by such patents, and we may need to cease the development, manufacture, testing
and commercialization of one or more of the product candidates we may develop. Any of the foregoing could
result in a material adverse effect on our business, financial condition, results of operations or prospects.
We may not be successful in obtaining, maintaining, protecting or defending the necessary intellectual
property rights to allow us to identify and develop product candidates, and test product components and
manufacturing processes for our development pipeline.
We currently have rights to certain intellectual property through our owned and in-licensed patents and other
intellectual property rights relating to identification, development and testing of our product candidates or other
technologies. As our activities may involve additional product candidates or services that could require the use of
intellectual property and other proprietary rights held by third parties, the growth of our business could depend in
part on our ability to acquire, in-license or use such intellectual property and proprietary rights. In addition, our
product candidates may require specific formulations to work effectively and efficiently and these intellectual
property and other proprietary rights may be held by others. We may be unable to secure such licenses or
otherwise acquire or in-license any compositions, methods of use, processes or other third-party intellectual
property rights from third parties that we identify as necessary, on reasonable terms, or at all, for product
candidates and other technologies that we may develop. The licensing and acquisition of third-party intellectual
property rights is a competitive area, and a number of more established companies are also pursuing strategies
to license or acquire third-party intellectual property rights that we may consider attractive or necessary. These
established companies may have a competitive advantage over us due to their size, cash resources, and greater
clinical development and commercialization capabilities.
We sometimes collaborate with academic institutions and/or utilize services of CROs and CMOs in certain
aspects of our research or development under written agreements with these parties. These agreements may
not ensure protection of intellectual property rights in developed technology, or may fail to provide us with
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sufficient control of or access to such intellectual property rights. For example, agreements with these academic
institutions typically provide us with an option to negotiate a license to any of the institution’s rights in technology
resulting from the collaboration. However, these institutions may not honor our option and right of first negotiation
for intellectual property rights or we may otherwise be unable to negotiate a license within the specified time
frame or under terms that are acceptable to us. If we are unable to do so, the institution may offer the intellectual
property rights to other parties, potentially blocking our ability to pursue our program or otherwise continue to
develop certain product candidates or other technologies. CROs and/or CMOs may control certain technologies
that were utilized in and/or developed through work on our behalf, and may not pursue protection of such
technologies, or may provide us with only non-exclusive rights in such technologies, so that relevant
technologies may be shared with other parties including our competitors. In any relationship with a third party,
there is a risk of disagreement over intellectual property rights (including inventorship or ownership of, rights to
protect and/or enforce, and/or rights to use) in utilized or developed technologies.
Moreover, some of our owned patents and patent applications are, and may in the future be, co-owned with third
parties. If we are unable to obtain, or continue to maintain, exclusive rights to any such third-party co-owners’
interest in such patents or patent applications, such co-owners may be able to license their rights to other third
parties, including our competitors, and our competitors could market competing products and technologies. In
addition, we may need the cooperation of any such co-owners of our patents in order to enforce such patents
against third parties, and such cooperation may not be provided to us. Any of the foregoing could have a material
adverse effect on our competitive position, business, financial conditions, results of operations and prospects.
In addition, third parties that perceive us to be a competitor may be unwilling to assign or license rights to us. We
also may be unable to license or acquire third-party intellectual property rights on terms that would allow us to
make an appropriate return on our investment. If we are unable to successfully obtain rights to required third-
party intellectual property rights or maintain, protect, defend or enforce the existing intellectual property rights we
have, we may have to abandon the development and commercialization of the relevant program or product
candidate, which could have a material adverse effect on our business, financial condition, results of operations
and prospects.
The lifespans of our patents may not be sufficient to effectively protect our products or product
candidates, technologies and business.
Patents have a limited lifespan. In the United States, the natural expiration of a patent is generally 20 years after
its first effective non-provisional filing date, assuming maintenance fees are timely paid after the patent has
issued. Most other jurisdictions also provide a 20-year nominal patent term, though many require payment of
regular, often annual, annuities to maintain pendency of an application or viability of an issued patent. In some
jurisdictions, one or more options for extension of a patent term may be available, but even with such
extensions, the lifespan of a patent, and the protection it affords, is limited. Even if patents covering our product
candidates, proprietary technologies and their uses are obtained, once the patent term has expired, we may be
subject to competition from third parties that can then use the inventions included in such patents to create
competing products and technologies. In addition, although upon issuance in the United States a patent’s life
can be increased based on certain delays caused by the USPTO, this increase can be reduced or eliminated
based on certain delays caused by the patent applicant during patent prosecution. The USPTO can also require,
in certain circumstances, that the expiration date of a subject patent be shortened by the filing of a terminal
disclaimer over one or more patents that may expire sooner than the subject patent. Given the amount of time
required for the development, testing and regulatory review of new product candidates, patents protecting such
product candidates might expire before or shortly after such candidates are commercialized. If any patents that
we own or in-license expire, we would not be able to stop others from using or commercializing similar or
identical technology and products, and our competitors could market competing products and technology. Any of
the foregoing could have a material adverse effect on our competitive position, business, financial conditions,
results of operations and prospects.
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If we do not obtain patent term extension and data exclusivity for any product candidates we may
develop, our business may be materially harmed.
Depending upon the timing, duration and specifics of any FDA marketing approval of any product candidates we
may develop, one or more of our U.S. patents may be eligible for limited patent term extension under the Drug
Price Competition and Patent Term Restoration Action of 1984, or Hatch-Waxman Amendments. The Hatch-
Waxman Amendments permit a patent extension term of up to five years as compensation for patent term lost
during the FDA regulatory review process for a drug product subject to the provisions of the Hatch-Waxman Act.
A patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of
product approval, only one patent may be extended and only those claims covering the approved drug, a method
for using it, or a method for manufacturing it may be extended. However, we may not be granted an extension
because of, for example, failing to exercise due diligence during the testing phase or regulatory review process,
failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents, or otherwise
failing to satisfy applicable requirements. For example, we did not extend any patent for our COVID-19 vaccine.
Moreover, the applicable time period or the scope of patent protection afforded could be less than we request. If
we are unable to obtain patent term extension or the term of any such extension is less than we request, our
competitors may obtain approval of competing products following our patent expiration, and our business,
financial condition, results of operations and prospects could be materially harmed.
If we fail to comply, or are viewed to have failed 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 or other third parties, we could lose license rights that are
important to our business or suffer monetary losses.
We are heavily reliant upon licenses to certain intellectual property and other proprietary rights from third parties
that are important or necessary to the development and commercialization of our technology and product(s) or
product candidates, and we expect to enter into similar license agreements in the future. Licensing of intellectual
property is important to our business and involves complex legal, business and scientific issues and is
complicated by the rapid pace of scientific discovery in our industry. Our licenses may not provide exclusive
rights to use such intellectual property and technology in all relevant fields of use and in all territories in which we
may wish to develop, test, or commercialize our technology and products in the future. As a result, we may not
be able to prevent competitors from developing and commercializing competitive products in territories included
in any or all of our licenses.
Where we obtain licenses from, or collaborate with, third parties, in some circumstances we may not have the
right to control the preparation, filing, prosecution, maintenance, enforcement and defense of patents and patent
applications covering the technology that we license from, or that arises through collaboration with, such third
parties, or such activities, if controlled by us, may require the input of such third parties. In some cases, patent
prosecution (including preparation and filing) of our in-licensed intellectual property or of intellectual property
developed through collaboration, is controlled solely by the licensor or collaborator. We may also require the
agreement and/or cooperation of our licensors and collaborators to protect, enforce, utilize, or defend any in-
licensed patent rights, and such agreement and/or cooperation may not be provided. Therefore, we cannot be
certain that these patents and patent applications will be prepared, filed, prosecuted, maintained, protected,
enforced or defended in a manner consistent with the best interests of our business. Any patents or patent
applications that we in-license may be challenged, narrowed, circumvented, invalidated or held unenforceable,
or our licensors may not properly maintain such patents or patent applications and they may expire. If our
licensors fail to obtain, maintain, defend, protect or enforce the intellectual property we license from them, we
could lose our rights to the intellectual property and our competitors could market competing products using the
inventions in such intellectual property. In certain cases, we control the prosecution of patents included from in-
licensed technology. In the event we breach any of our obligations related to such prosecution, we may incur
significant liability to our collaborators. If we and our licensors or collaborators disagree over IP protection
strategies for relevant technologies, disputes may arise, and we could lose access to or control over protection
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of technologies important to our business. If so, we may not be able to adequately protect our product(s) or
product candidates, including not being able to prevent a competitor or other third party from developing the
same product(s) or product candidates for the same or a different use. Any of the foregoing could have a
material adverse effect on our competitive position, business, financial conditions, results of operations and
prospects.
Moreover, we may disagree from time to time with licensors or collaborators regarding, among other things, the
interpretation of each party’s obligations or the amounts payable under our agreements. For example, we were
in discussions with the University of Pennsylvania, or UPenn, and the National Institutes of Health, or the NIH,
concerning royalties and other related amounts allegedly owed on sales of our COVID-19 vaccine since
commercialization. UPenn subsequently filed suit against us in the U.S. District Court for the Eastern District of
Pennsylvania in connection with this dispute. On December 20, 2024, we entered into a Settlement Agreement
with the NIH pursuant to which we agreed, among other things, to pay $791.5 million to the NIH. On March 27,
2025, we entered into a Settlement Agreement with UPenn pursuant to which we agreed, among other things, to
pay up to $467.0 million to UPenn, consisting of $400.0 million as royalties for calendar years 2020-2023, up to
$15.0 million in funding for a three-year extension of the research term of our and UPenn’s vaccine alliance, and
$52.0 million as a contribution to a research and development investment fund to be jointly managed by us and
UPenn. For more information regarding our settlements with the NIH and UPenn, see Note 12.2 of our
consolidated financial statements included elsewhere in this Annual Report.
If we are found to have failed to satisfy obligations or materially breached any of our agreements, such as
licenses to third-party intellectual or any disagreements between us and our licensors, a licensor could
potentially have the right or reason to terminate the license or to exercise the option of a non-exclusive license,
which would allow our competitors to have access to the same intellectual property and technology licensed to
us. Our existing license agreements impose, and we expect that future license agreements will impose, various
diligence, milestone and royalty payment, exclusivity and other obligations on us. If we fail to comply with our
obligations under these agreements, including royalty payments, or we are subject to a bankruptcy, the licensor
may have the right to terminate the license agreement, in which event we would not be able to develop, market
and commercialize product(s) or product candidates covered by the license agreement. In spite of our best
efforts and even if we disagree, our licensors might still conclude that we have materially breached our license
agreements and might therefore terminate the license agreements, thereby removing our ability to develop, test
and commercialize the product(s) or product candidates covered by these license agreements. In the event that
any of our license agreements were to be terminated by the licensor, we may need to negotiate new or
reinstated agreements, which may not be available to us on equally favorable terms, or at all. If these license
agreements are rightfully terminated, or if the underlying patents or other intellectual property fail to provide the
intended exclusivity, competitors would have the freedom to seek regulatory approval of, and to market and
commercialize, products similar or identical to ours, and our licensors may be able to seek additional judicial
remedies. In addition, we may seek to obtain additional licenses from our licensors and, in connection with
obtaining such licenses, we may agree to amend our existing license agreements in a manner that may be more
favorable to the licensors, including by agreeing to terms that could enable third parties (potentially including our
competitors) to receive licenses to a portion of the intellectual property that is subject to our existing licenses.
Failure to prevail with respect to any contractual disagreements could result in a material adverse effect on our
competitive position, business, financial conditions, results of operations or prospects, particularly if discussions
result in legal or other dispute resolution proceedings.
We are generally also subject to all of the same risks with respect to protection of intellectual property that we
license, as we are for intellectual property that we own, which are described in this section. If we, our co-owners
or our licensors fail to adequately protect this intellectual property, our ability to develop, test, market and
commercialize our product(s) or product candidates could suffer. Moreover, if disputes over intellectual property
that we have in-licensed prevent or impair our ability to maintain our current licensing arrangements on
commercially acceptable terms, we may be unable to successfully develop, test, market and commercialize the
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affected product(s) or product candidates, which could have a material adverse effect on our business, financial
condition, results of operations and prospects.
Some of our in-licensed intellectual property has been discovered through government-funded
programs and thus may be subject to federal regulations such as “march-in” rights and certain reporting
requirements, and compliance with such regulations may limit our exclusive rights and our ability to
contract with manufacturers.
Certain intellectual property rights that have been in-licensed, including patent applications and patents that we
in-license from the University of Pennsylvania, the Louisiana State University, the Broad Institute, the NIH,
Genevant, and CellScript, have been generated through the use of U.S. government funding and are therefore
subject to certain federal regulations. The U.S. government may have certain rights to intellectual property
embodied in our current or future product candidates pursuant to the Bayh-Dole Act of 1980, or the Bayh-Dole
Act. These U.S. government rights may include a non-exclusive, non-transferable, irrevocable worldwide license
to use inventions covered by that Act for any governmental purpose. In addition, the U.S. government may have
the right, under certain limited circumstances, to require the licensor to grant exclusive, partially exclusive or
non-exclusive licenses to any of these inventions to a third party if it determines that (i) adequate steps have not
been taken to commercialize the invention, (ii) government action is necessary to meet public health or safety
needs or (iii) government action is necessary to meet requirements for public use under federal regulations (also
collectively referred to as “march-in rights”). The U.S. government may also have the right to take title to these
inventions if the licensor fails to disclose the invention to the government or fails to file an application to register
the intellectual property within specified time limits. Any exercise by the government of such rights could harm
our competitive position, business, financial condition, results of operations and prospects. Intellectual property
generated under a government-funded program is also subject to certain reporting requirements, compliance
with which may require us to expend substantial resources.
In addition, the U.S. government requires that any products embodying any such inventions or produced through
the use of any such inventions be manufactured substantially in the United States. This preference for U.S.
industry may be waived by the federal agency that provided the funding if the owner or assignee of the
intellectual property can show that reasonable but unsuccessful efforts have been made to grant licenses on
similar terms to potential licensees that would be likely to manufacture the products substantially in the United
States or that under the circumstances domestic manufacture is not commercially feasible. We may not be able
to obtain a waiver of this preference for U.S. industry, and this preference may limit our ability to contract with
non-U.S. product manufacturers for products covered by such intellectual property. To the extent any of our
owned or in-licensed future intellectual property is generated through the use of U.S. government funding, the
provisions of the Bayh-Dole Act may similarly apply. If we or our licensors are unable to secure an exemption to
these manufacturing requirements, if we comply with them, or if we are unable to comply with them, we may
experience a material adverse effect on our competitive position, business, financial conditions, results of
operations and prospects.
Our current proprietary position for certain products and product candidates depends upon our owned
or in-licensed patent filings covering components, manufacturing-related methods, formulations and/or
methods of use, which may not adequately prevent a competitor or other third party from using the same
product candidate for the same or a different use.
Composition of matter patent protection is generally considered to be desirable because it provides protection
without regard to any particular method of use or manufacture or formulation. While we have pursued or
obtained patent protection covering components of certain product candidates and tests, manufacturing-related
methods, formulations and/or methods of use, we have not yet obtained patent protection for all components of
certain product candidates and tests, manufacturing-related methods, formulations and/or methods of use. For
instance, we do not currently have any claims in our owned or in-licensed issued U.S. patents that cover the
overall construct used in our iNeST product candidates. We also cannot be certain that claims in any future
patents issuing from our pending owned or in-licensed patent applications or our future owned or in-licensed
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patent applications will cover the composition of matter, tests, manufacturing-related methods, formulations and/
or methods of use of our current or future product candidates. Method of use patents protect the use of a product
for the specified method and formulation patents cover formulations to deliver therapeutics. These types of
patents do not prevent a competitor or other third party from developing, testing, marketing or commercializing a
similar or identical product for an indication that is outside the scope of the patented method or from developing
a different formulation that is outside the scope of the patented formulation. Moreover, with respect to method of
use patents, even if competitors or other third parties do not actively promote their product for our targeted
indications or uses for which we may obtain patents, physicians may recommend that patients use these
products off-label, or patients may do so themselves. Although off-label use may infringe or contribute to the
infringement of method of use patents, the practice is common and this type of infringement is difficult to prevent
or enforce. Consequently, we may not be able to prevent third parties from practicing our inventions in the United
States or abroad.
Intellectual property rights of third parties could adversely affect our ability to commercialize our
product(s) and product candidates, and we might be required to litigate or obtain licenses from third
parties in order to develop, test or market our product(s) and product candidates.
Because our products and product candidates are still in early stages of development, testing or
commercialization, and one or more features of the products or product candidates, or related technologies such
as their manufacture, formulation, testing or use, may still change, we cannot be confident that we are aware of
all third-party intellectual property that might be relevant to products that we eventually hope to commercialize.
Furthermore, even if all aspects of our product(s) or product candidates, or of other technology, were known, it is
possible that third-party intellectual property, which may or may not currently be public, could develop in a
manner (for example, through issuance of additional patents) that could impede our ability to make or use
relevant products or product candidates, or other technology. Various third-party competitors practice in relevant
spaces, and may have issued patents, or patent applications that will issue as patents in the future, that will
impede or preclude our ability to commercialize products. Furthermore, while U.S. patent laws provide a “safe
harbor” to our clinical product candidates under 35 U.S.C. § 271(e)(1), which exempts from patent infringement
activities related to pursuing FDA approval for a drug product, that exemption expires when an NDA or BLA is
submitted. Accordingly, after such submission (including for certain formulations of our COVID-19 vaccine), the
271(e)(1) safe harbor may no longer provide the same level of protection from third party patent infringement
claims for that product. We may become exposed to lawsuits from third parties who consider our COVID-19
vaccine to infringe their patents. More generally, given the uncertainty of clinical trials, we cannot be certain of
the timing of their completion and it is possible that we might want to submit an NDA or BLA at a time when one
or more relevant third-party patents is in force. Thus, it is possible that at the time that we commercialize our
product candidates, one or more third parties may have issued patent claims that cover such products or critical
features of their production, testing or use. We may not be able to commercialize our products if patents issued
to third parties or other third-party intellectual property rights cover, or may be alleged to cover, our products or
elements thereof, or their methods of manufacture, testing or use at the time that we seek to commercialize
them. In such cases, we may not be in a position to develop, test or commercialize product candidates unless
we successfully pursue litigation to nullify or invalidate the third-party intellectual property right concerned,
successfully design around their claims, or enter into a license agreement with the intellectual property right
holder(s). Such litigation or licenses could be costly, licenses could not be available on commercially reasonable
terms or at all, and design-around could be prohibitively expensive or impossible.
Additionally, with respect to our products, product candidates and related technologies that may play a role in
addressing a pandemic or other public health emergency, it is unclear whether governments around the world
will protect vaccine manufacturers for liability from infringement of third party intellectual property, at least during
the period of such public health emergency. Thus, it is possible that third parties may assert intellectual property
rights against us relating to our COVID-19 vaccine, and that we will not be successful in arguing that
commercialization of our COVID-19 vaccine is exempted from infringement and/or liability for infringement (for
example, under 35 U.S.C. § 271(e)(1), discussed above, or under the Public Readiness and Emergency
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Preparedness Act, or the PREP Act, etc.). Furthermore, even if such commercialization was deemed protected
from infringement during the period of the pandemic crisis, now that various global and U.S. agencies have
declared an end to the global COVID-19 public health emergency, any such exemption may be terminated so
that continuing commercialization could expose us to liability, and might even be precluded if third party(ies) who
hold relevant intellectual property rights are able to secure injunction(s) or are unwilling to license to us on
commercially feasible terms.
It is also possible that we have failed to identify relevant third-party patents that cover, or applications that will
mature into patents that cover, one or more aspects of our platform or product(s) and product candidates. Given
that, in most jurisdictions, a patent application is confidential when initially filed, and typically remains so until it is
published about 18 months after the initial filing, it may not be possible for us to identify certain relevant filings in
time to avoid using the technology that they claim. Additionally, the claims of pending patent applications can,
subject to certain limitations, be amended over time, so that even patent applications whose claims did not cover
our products or activities when published could be amended to cover one or more aspects of our platform or
product candidates over time, and we might not be aware that such amendment had been made.
We may be involved in lawsuits or other legal proceedings to protect or enforce our intellectual property
or the intellectual property of our licensors, or to defend against third-party claims that we infringe,
misappropriate or otherwise violate such third party’s intellectual property, each of which could be
expensive, time consuming and unsuccessful.
There is a substantial amount of litigation, both within and outside the United States, involving patent and other
intellectual property rights in the biotechnology and pharmaceutical industries, including patent infringement
lawsuits, interferences, oppositions, ex parte reexaminations, post-grant review, and inter partes review
proceedings before the USPTO and corresponding European and other non-U.S. patent offices.
Competitors and other third parties may infringe, misappropriate or otherwise violate our intellectual property
rights or those of our licensors. To prevent infringement, misappropriation or other unauthorized use, we may be
required to file claims, which can be expensive and time-consuming. In certain instances, we have instituted and
may in the future institute inter partes review proceedings against issued U.S. patents and opposition
proceedings against European patents owned by third parties. We have a number of opposition proceedings
ongoing at the EPO against third-party patents related to mRNA technologies. As the biotechnology and
pharmaceutical industries expand and more patents are issued, the risk increases that our products, product
candidates and services may be subject to claims of infringement of the patent rights of third parties.
In addition, in a patent infringement proceeding, our owned or in-licensed patents may be challenged and a court
may decide that a patent we own or in-license is not valid, is unenforceable and/or is not infringed. If we or any
of our potential future collaborators were to initiate legal proceedings against a third party to enforce a patent
directed at one of our product(s) and/or product candidates, the defendant could counterclaim that our patent is
invalid and/or unenforceable in whole or in part. In patent litigation in the United States, defendant counterclaims
alleging invalidity and/or unenforceability are commonplace. Grounds for a validity challenge include an alleged
failure to meet any of several statutory requirements, including novelty, non-obviousness, enablement or written
description. Grounds for an unenforceability assertion could include an allegation that someone connected with
prosecution of the patent withheld relevant information from the USPTO or made a misleading statement during
prosecution. Third parties may also raise similar claims before the USPTO, even outside the context of litigation.
Similar mechanisms for challenging the validity and enforceability of a patent exist in ex-U.S. patent offices and
may result in the revocation, cancellation or amendment of any ex-U.S. patents we hold in the future. The
outcome following legal assertions of invalidity and unenforceability is unpredictable, and prior art could render
our patents or those of our licensors invalid. If a defendant were to prevail on a legal assertion of invalidity and/or
unenforceability, we could lose at least part, and perhaps all, of the patent protection on a product and/or product
candidate. Such a loss of patent protection would have a material adverse impact on our competitive position,
business, financial conditions, results of operations and prospects.
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Third parties, including our competitors to non-practicing entities or patent assertion entities, may assert that we
are employing their intellectual property and other proprietary technology without authorization. There may be
third-party patents or patent applications with claims to materials, formulations, testing, methods of manufacture
or methods for treatment related to the use, development, testing, manufacture or commercialization of our
COVID-19 vaccine or product candidates. For example, BioNTech SE and certain of our wholly owned
subsidiaries are defendants in litigations initiated by CureVac, Moderna, Arbutus, Genevant, GSK, and
Promosome regarding Comirnaty. See “Legal Proceedings” in this Annual Report. As patent applications can
take many years to issue, there may be currently pending patent applications which may later result in issued
patents that our product(s) and/or product candidates may infringe. In addition, third parties may obtain patents
in the future and claim that our technologies infringe upon these patents. If any third-party patents were held by a
court of competent jurisdiction to cover the testing or manufacturing processes of any of our product(s) and/or
product candidates, any molecules formed during the testing and manufacturing processes or any final product
itself, the holders of any such patents may obtain injunctive or other equitable relief, which could effectively block
our ability to develop, test and commercialize such product and/or product candidate unless we obtained a
license under the applicable patents, or until such patents expire. Similarly, if any third-party patents were held
by a court of competent jurisdiction to cover aspects of our formulations, processes for testing or manufacture or
methods of use, including combination therapy, the holders of any such patents may be able to block our ability
to develop, test and commercialize the applicable product and/or product candidate unless we obtained a license
or until such patent expires. In either case, such a license may not be available on commercially reasonable
terms, or at all, or may be non-exclusive.
Interference or derivation proceedings provoked by third parties or brought by us or declared by the USPTO may
be necessary to determine the priority of inventions with respect to our patents or patent applications or those of
our licensors. An unfavorable outcome could require us to cease using the related technology or to attempt to
license rights to it from the prevailing party. Our business could be harmed if the prevailing party does not offer
us a license on commercially reasonable terms or at all, or if a non-exclusive license is offered and our
competitors gain access to the same intellectual property and technology. Our defense of litigation, interference,
derivation or similar proceedings may fail and, even if successful, may result in substantial costs and distract our
management, technical personnel and other employees. In addition, the uncertainties associated with litigation
could have a material adverse effect on our ability to raise the funds we need to continue our clinical trials and
research programs, to license necessary technology from third parties or to enter into development or
manufacturing collaborations that would help us bring our product(s) and/or product candidates to market.
Even if resolved in our favor, litigation or other legal proceedings relating to our intellectual property rights may
cause us to incur significant expenses, and could distract our management, technical personnel and other
employees from their normal responsibilities. Such proceedings could substantially increase our operating losses
and reduce the resources available for development activities or any future sales, marketing or distribution
activities. We may not have sufficient financial or other resources to conduct such proceedings adequately.
Some of our competitors may be able to sustain the costs of such proceedings more effectively than we can
because of their greater resources in one or more aspects, or for other reasons. Uncertainties resulting from the
initiation and continuation of patent litigation or other proceedings could compromise our ability to compete in the
marketplace.
In the event of a successful claim of infringement, misappropriation or other violation against us, we may have to
pay substantial damages, including treble damages and attorneys’ fees for willful infringement, pay royalties,
redesign our infringing products, or obtain one or more licenses from third parties, which may not be made
available on commercially favorable terms, if at all, or may require substantial time and expense.
Such licenses are likely to be non-exclusive and, therefore, our competitors may have access to the same
intellectual property and technology licensed to us. If we fail to obtain a required license and are unable to
design around a patent, we may be unable to effectively market some of our technology and product(s) and/or
product candidates, which could limit our ability to generate revenues or achieve or maintain profitability and
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possibly prevent us from generating revenue sufficient to sustain our operations. Moreover, certain of our
collaborations provide, and we expect additional collaborations to provide, that royalties payable to us for
licenses to our intellectual property may be offset by amounts paid by our collaborators to third parties for
licenses to such third parties’ intellectual property in the relevant fields, which could result in significant
reductions in our revenues from products developed through collaborations.
In addition, in connection with certain license and collaboration agreements, we have agreed to indemnify certain
third parties for certain costs incurred in connection with litigation relating to intellectual property rights or the
subject matter of the agreements. The cost to us of any litigation or other proceeding relating to intellectual
property rights, even if resolved in our favor, could be substantial.
Furthermore, because of the substantial amount of discovery required in connection with intellectual property
litigation, there is a risk that some of our confidential information could be compromised by disclosure during this
type of litigation. There could also be public announcements of the results of hearings, motions or other interim
proceedings or developments in any litigation or other intellectual property proceedings. If securities analysts or
investors perceive these results to be negative, the price of the ADSs representing our ordinary shares could
decline.
Obtaining 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.
Periodic maintenance fees, renewal fees, annuity fees, and various other governmental fees on patents and
applications will be due to be paid to the USPTO and various governmental patent agencies outside of the
United States in several stages over the lifetime of the patents or applications. We have systems in place to
remind us to pay these fees and we employ an outside firm and rely on our outside counsel to pay these fees
due to non-U.S. patent agencies; however, we cannot guarantee that we will successfully pay these fees. The
USPTO and various non-U.S. governmental patent agencies require compliance with a number of procedural,
documentary, fee payment, and other similar provisions during the patent application process. We employ
reputable law firms and other professionals to help us comply, and in many cases, an inadvertent lapse can be
cured by payment of a late fee or by other means in accordance with the applicable rules. However, there are
situations in which non-compliance can result in abandonment or lapse of the patent or patent application,
resulting in partial or complete loss of patent rights in the relevant jurisdiction. We are also dependent on our
licensors to take the necessary action to comply with these requirements with respect to our in-licensed
intellectual property, and we cannot guarantee that they will do so. In such an event, our competitors might be
able to enter the market with similar or identical products or technology, and this would have a material adverse
impact on our business, financial condition, results of operations and prospects.
Changes in patent law in the United States or in other countries could diminish the value of patents in
general, thereby impairing our ability to protect our products.
As is the case with other biotechnology companies, our success is heavily dependent on our intellectual property
rights, particularly patents that we own and in-license. Obtaining and enforcing patents in the biotechnology
industry involve both technological and legal complexity, and therefore obtaining and enforcing biotechnology
patents is costly, time-consuming and inherently uncertain. Moreover, there are periodic changes in patent law.
For example, after March 2013, under the America Invents Act, the United States transitioned to a first inventor
to file system in which, assuming that other requirements for patentability are met, the first inventor to file a
patent application will be entitled to the patent on an invention regardless of whether a third party was the first to
invent the claimed invention. The America Invents Act also includes a number of significant changes that have
affected the way patent applications are prosecuted and also affect patent litigation. Such legislation and its
implementation could increase the uncertainties and costs surrounding the prosecution of our patent applications
and the enforcement or defense of our issued patents, all of which could have a material adverse effect on our
business, financial condition, results of operations and prospects.
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In addition, decisions by courts and governmental bodies in the United States and other jurisdictions may affect
the value of patent applications, issued patents or other intellectual property that we own or in-license. For
example, recent U.S. Supreme Court rulings have narrowed the scope of patent protection available in certain
circumstances and weakened the rights of patent owners in certain situations. In addition to increasing
uncertainty with regard to our ability to obtain patents in the future, this combination of events has created
uncertainty with respect to the value of patents, once obtained. Depending on decisions by the U.S. Congress,
the federal courts, the USPTO and other administrative agencies, and their equivalents in other jurisdictions, the
laws and regulations governing patents could change in unpredictable ways that could have a material adverse
effect on our existing patent portfolio and our ability to obtain, maintain, protect, defend or enforce our intellectual
property in the future.
If we are unable to protect the confidentiality of our trade secrets, our business and competitive position
would be harmed.
In addition to seeking patent protection for some of our technology, product(s) and product candidates, we also
seek to rely on trade secret protection and confidentiality agreements to maintain our competitive position and
protect proprietary know-how that is not patentable, processes for which patents are difficult to enforce and any
other elements of our product discovery development, testing, manufacturing and commercialization processes
that involve proprietary know-how, information or technology that is not covered by patents. However, trade
secrets and know-how may be difficult to protect.
We seek to protect these trade secrets, know-how and other proprietary technology, in part, by entering into non-
disclosure and confidentiality agreements with parties who have access to them, such as our employees,
corporate collaborators, outside scientific collaborators, CROs, CMOs, consultants, advisors and other third
parties. We also enter into confidentiality and invention or patent assignment agreements with our employees
and consultants and require all of our employees and key consultants who have access to our trade secrets,
proprietary know-how, information or technology to enter into confidentiality agreements. We cannot guarantee
that we have entered into such agreements with each party that may have or have had access to our trade
secrets or proprietary technology and processes. To the extent we become involved in litigation that may require
discovery of our trade secrets, know-how and other proprietary technology, we seek to secure protective orders
from the court that bind the parties with access to the discovered information. Despite our best efforts, we cannot
be certain that our trade secrets and other confidential proprietary information will not be disclosed or that
competitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent
information and techniques. Any of these parties who may have access to our trade secrets, know-how and
other proprietary technology may breach such agreements or orders. For example, a former employee of our
COVID-19 vaccine collaborator, Pfizer, has reportedly misappropriated trade secrets on our COVID-19 vaccine.
We may not be able to obtain adequate remedies for such breaches. Enforcing a claim that a party illegally
disclosed or misappropriated a trade secret or know-how is difficult, expensive and time-consuming, and the
outcome is unpredictable. In addition, some courts inside and outside the United States are less willing or
unwilling to protect trade secrets and know-how. In addition, we cannot be certain that our proprietary technical
information and related confidential documents that we have shared with our collaborators and/or have
submitted to governmental agencies, including regulatory agencies, for evaluation and supervision of
pharmaceutical products will be kept confidential. For example, certain documents relating to our COVID-19
vaccine were unlawfully accessed after a cyberattack on the EMA in December 2020. If any of our trade secrets
or know-how were to be lawfully obtained or independently developed by a competitor or other third party, we
would have no right to prevent them from using that technology or information to compete with us. If we are
unable to prevent unauthorized material disclosure of our intellectual property to third parties, we may not be
able to establish or maintain a competitive advantage in our market, which could materially adversely affect our
business, operating results, financial condition and prospects.
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We may be subject to claims that we have wrongfully hired an employee from a competitor, or that our
employees, consultants or independent contractors have wrongfully used or disclosed confidential
information of third parties, including alleged trade secrets of their former employers.
We have received confidential and proprietary information from third parties in the course of our research and
other collaborations with others in the industry, academic institutions and other third parties. In addition, many of
our employees, consultants and advisors are currently or were previously employed at universities or other
biotechnology or pharmaceutical companies, including our competitors or potential competitors. Although we try
to ensure that our employees, consultants, independent contractors and advisors do not use the confidential or
proprietary information, trade secrets or know-how of others in their work for us, we may be subject to claims
that we have inadvertently or otherwise used or disclosed confidential or proprietary information, trade secrets or
know-how of these third parties, or that our employees, consultants, independent contractors or advisors have
inadvertently or otherwise used or disclosed confidential information, trade secrets or know-how of such
individual’s current or former employer. If we fail in defending any such claims, in addition to paying monetary
damages, we may lose valuable intellectual property rights or personnel. Litigation may be necessary to defend
against these claims. Even if we are successful in defending against these claims, litigation could result in
substantial cost and be a distraction to our management, technical personnel and other employees. Claims that
we or our employees, consultants or advisors have misappropriated the confidential or proprietary information,
trade secrets or know-how of third parties could have a material adverse effect on our business, financial
condition, results of operations and prospects.
We may be subject to claims challenging the inventorship or ownership of our patents and other
intellectual property.
In the future, we may be subject to claims that current or former employees, consultants, independent
contractors, collaborators or other third parties have an interest in our patents or other intellectual property as an
inventor or co-inventor. While it is our policy to require our employees, consultants, independent contractors,
collaborators and other third parties who may be involved in the conception, development or reduction to
practice of intellectual property to execute agreements assigning such intellectual property to us, we may be
unsuccessful in executing such an agreement with each party who, in fact, conceives, develops or reduces to
practice such intellectual property that we regard as our own. In addition, certain such agreements, even if
successfully executed may distribute ownership or control of intellectual property rights between or among
parties, for example based on subject matter, relationship to other intellectual property, and/or one or more
aspects of development of the intellectual property; after the agreements are in place disputes may arise over
such distribution principles or over proper treatment of particular developed intellectual property in accordance
with them. Disagreements may be difficult or impossible to resolve, may be expensive to address, and may
result in our failing to secure or maintain ownership in or control of intellectual property necessary or important to
our business.
The assignment of intellectual property rights may not be self-executing, or the assignment agreements may be
breached. For example, we may have inventorship or ownership disputes arise from conflicting obligations of
employees, consultants, independent contractors, collaborators or other third parties who are involved in
developing and commercializing our product(s) and/or product candidates. Litigation may be necessary to
defend against these and other claims challenging inventorship or ownership. If we fail in defending any such
claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, such as
exclusive ownership of, or right to use, valuable intellectual property. Such an outcome could have a material
adverse effect on our business, operating results and financial condition. Even if we are successful in defending
against such claims, litigation could result in substantial costs and be a distraction to management, technical
personnel and other employees.
Furthermore, the laws of some other countries do not protect intellectual property and other proprietary rights or
establish ownership of inventions to the same extent or in the same manner as the U.S. laws. A majority of our
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employees work in Germany and are subject to German employment law. Ideas, developments, discoveries and
inventions made by such employees are subject to the provisions of the German Act on Employees’ Inventions,
which regulates the ownership of, and compensation for, inventions made by employees. We face the risk that
disputes can occur between us and our employees or former employees pertaining to alleged non-adherence to
the provisions of this act that may be costly to defend and take up our management’s, technical personnel’s and
other employees’ time and efforts whether we prevail or fail in any such dispute. There is a risk that the
compensation we provided to employees who assign patents to us may be deemed to be insufficient and we
may be required under German law to increase the compensation due to such employees for the use of the
patents. In those cases, where employees’ rights have not been assigned to us, we may need to pay
compensation for the use of those patents. If we are required to pay additional compensation or face other
disputes under the German Act on Employees’ Inventions, our business, results of operations and financial
condition could be adversely affected.
We will not seek to protect our intellectual property rights in all jurisdictions throughout the world, and
we may not be able to adequately enforce our intellectual property rights even in the jurisdictions where
we seek protection.
Filing, prosecuting and defending patents on product(s) and/or product candidates in all countries throughout the
world would be prohibitively expensive, and our intellectual property rights in some countries outside the United
States, particularly those in Asia, including China, can be less extensive than those in the United States. In
addition, the laws of some countries do not protect intellectual property rights to the same extent as laws in
Germany and the United States. Consequently, we may not be able to prevent third parties from practicing our
inventions in all countries outside the United States to the same extent as within the United States, or from
selling or importing products made using our inventions in and to the United States or other jurisdictions.
Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop
their own product candidates and further, may export otherwise infringing products to territories where we have
patent protection, but enforcement is not as strong as that in the United States. These products may compete
with our product(s) and/or product candidates, and our patents or other intellectual property rights may not be
effective or sufficient to prevent them from competing.
Many companies have encountered significant problems in protecting and defending intellectual property rights
in certain jurisdictions, particularly outside of Europe and the United States. The legal systems of certain
countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets and
other intellectual property protection, particularly those relating to biotechnology products, which could make it
difficult for us to stop the infringement, misappropriation or other violation of our patents and other intellectual
property or development, testing, marketing and commercialization of competing products in violation of our
owned or in-licensed intellectual property and other proprietary rights generally. Proceedings to enforce our
intellectual property rights in such jurisdictions could result in substantial costs and divert our efforts and
attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted
narrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against
us. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded, if any, may
not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the
world may be inadequate to obtain a significant commercial advantage from the intellectual property that we
develop or in-license. In particular, the validity, enforceability and scope of protection of intellectual property in
China, where we derive net sales and maintain collaboration partnerships including licensing, are still evolving
and historically, have not protected and may not protect in the future, intellectual property rights to the same
extent as laws developed in Europe, including Germany, and the United States. Consequently, the time required
to enforce our intellectual property rights in the legal regime of China may be lengthy and delay our recovery.
Many countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses
to third parties. In addition, many countries limit the enforceability of patents against government agencies or
government contractors. In these countries, the patent owner may have limited remedies, which could materially
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diminish the value of such patent. If we or any of our licensors is forced to grant a license to third parties with
respect to any patents relevant to our business, our competitive position may be impaired, and our business,
financial condition, results of operations and prospects may be adversely affected.
If our trademarks and trade names are not adequately protected, we may not be able to build name
recognition in our markets of interest and our business may be adversely affected.
Our registered or unregistered trademarks or trade names may be challenged, infringed, circumvented or
declared generic or determined to be infringing on other marks. We may not be able to protect our rights to these
trademarks and trade names, which we need to build name recognition among potential collaborators or
customers in our markets of interest. At times, competitors may adopt trade names or trademarks similar to ours
or collaborators may fail to use our trade names or trademarks appropriately or at all, thereby impeding our
ability to build brand identity and possibly leading to market confusion. In addition, there could be potential trade
name or trademark infringement claims brought by owners of other trademarks or trademarks that incorporate
variations of our registered or unregistered trademarks or trade names. Over the long term, if we are unable to
establish name recognition based on our trademarks and trade names, we may not be able to compete
effectively and our business may be adversely affected. We may license our trademarks and trade names to
third parties, such as distributors and collaborators. Though these license agreements may provide guidelines
for how our trademarks and trade names may be used, a breach of these agreements or misuse or failure to use
of our trademarks and trade names by our licensees may jeopardize our rights in or diminish the goodwill
associated with our trademarks, and trade names. Our efforts to enforce or protect our proprietary rights related
to trademarks, trade names, trade secrets, know-how, domain names, copyrights or other intellectual property
may be ineffective and could result in substantial costs and diversion of resources and could adversely affect our
business, financial condition, results of operations and prospects.
Intellectual property rights do not necessarily address all potential threats to our competitive advantage.
The degree of future protection afforded by our intellectual property rights is uncertain because intellectual
property rights have limitations, and may not adequately protect our business or permit us to maintain our
competitive advantage. For example:
–others may be able to make COVID-19 vaccines or therapies, and/or individualized cancer immunotherapies
that are similar to our COVID-19 vaccine and/or any product candidates we may develop and commercialize
or utilize similar technologies that are not covered by the claims of the patents that we now or may in the
future own or have exclusively in-licensed;
–we, our co-owners or our licensors or future collaborators might not have been the first to make the inventions
covered by the issued patents or pending patent applications that we own or have exclusively in-licensed;
–we, our co-owners or our licensors or future collaborators might not have been the first to file patent
applications covering certain of our or their inventions;
–others may independently develop similar or alternative technologies or duplicate any of our technologies
without infringing our owned or in-licensed intellectual property rights;
–it is possible that our pending patent applications or those that we may own or in-license in the future will not
lead to issued patents;
–claims of issued patents that we own or have exclusively in-licensed may be held invalid or unenforceable,
including as a result of legal challenges by our competitors;
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–our competitors might conduct research, development, testing or commercialization activities in countries
where we do not have patent rights and then use the information learned from such activities to develop
competitive products for sale in our major commercial markets;
–we may not develop additional proprietary technologies that are patentable;
–the patents of others may have an adverse effect on our business; and
–we may choose not to file a patent in order to maintain certain trade secrets or know-how, and a third party
may subsequently file a patent covering such intellectual property.
Should any of these events occur, they could have a material adverse effect on our business, financial condition,
results of operations and prospects.
Risks Related to Government Regulation
We may not be able to develop or obtain approval for companion diagnostics required for
commercialization of some of our product candidates.
Administration of some of our product candidates may require the use of immuno-assays and bioinformatic tools
in which patients are screened for optimal target antigens of our product candidates. If safe and effective use of
a biologic product depends on an in vitro diagnostic, then the FDA generally requires approval or clearance of
the diagnostic, known as a companion diagnostic, concurrently with approval of the therapeutic product. To date,
the FDA has generally required in vitro companion diagnostics intended to select the patients who will respond to
cancer treatment to obtain a pre-market approval, or PMA, for that diagnostic, which can take up to several
years, simultaneously with approval of the biologic product. Similarly, in the European Union, an in vitro
companion diagnostic may be placed on the market only if it conforms to certain “essential requirements” and
bears the Conformité Européene Mark, or CE Mark. The conformity assessment process to obtain the CE Mark
can be lengthy and we may fail to demonstrate such conformity. Further, the applicable regulatory framework for
in vitro diagnostics in the EU changed in May 2022 when a new EU regulation with stricter regulatory
requirements for in vitro diagnostics became applicable. Under the regulation, all new in vitro companion
diagnostics must undergo conformity assessment by a notified body prior to obtaining their CE Mark.
For our individualized immunotherapy candidates, the FDA and comparable regulatory authorities outside of the
United States may require the development and regulatory approval of a companion diagnostic assay as a
condition to approval. The FDA may require original or supplemental PMA approvals for use of that same
companion diagnostic as a condition of approval of additional individualized therapeutic candidates. We do not
have experience or capabilities in developing or commercializing companion diagnostics and plan to rely in large
part on third parties to perform these functions. Companion diagnostic assays are subject to regulation by the
FDA and other comparable regulatory authorities in other jurisdictions as medical devices and require separate
regulatory approval prior to the use of such diagnostic assays with our individualized therapeutic candidates. If
we, or any third parties that we engage to assist us, are unable to successfully develop companion diagnostic
assays for use with our individualized therapeutic candidates, or are unable to obtain regulatory approval or
experience delays in either development or obtaining regulatory approval, we may be unable to identify patients
with the specific profile targeted by our product candidates for enrollment in our clinical trials. Accordingly, further
investment may be required to further develop or obtain the required regulatory approval for the relevant
companion diagnostic assay, which would delay or substantially impact our ability to conduct additional clinical
trials or obtain regulatory approval.
Because we are developing some of our product candidates for the treatment of diseases in which there
is little clinical experience and, in some cases, using new endpoints or methodologies, the FDA, the EMA
or other regulatory authorities may not consider the endpoints of our clinical trials to provide clinically
meaningful results.
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There may not be pharmacologic therapies approved to treat the underlying causes of many diseases that we
may address in the future. For instance, we and our collaborators are applying our technology to develop
therapeutics in indications such as certain rare diseases, including some for which no or few clinical trials have
been attempted. As a result, any future design and conduct of clinical trials of product candidates for the
treatment of certain rare diseases may take longer, be more costly, or be less effective as part of the novelty of
development in these diseases. Even if we decide to conduct clinical trials and the FDA does find our success
criteria to be sufficiently validated and clinically meaningful, we may not achieve the pre-specified endpoint to a
degree of statistical significance in any pivotal or other clinical trials we or our collaborators may conduct for our
programs. Further, even if we do achieve the pre-specified criteria, our trials may produce results that are
unpredictable or inconsistent with the results of the more traditional efficacy endpoints in the trial. The FDA also
could give overriding weight to other efficacy endpoints over a primary endpoint, even if we achieve statistically
significant results on that endpoint, if we do not do so on our secondary efficacy endpoints. The FDA also weighs
the benefits of a product against its risks and the FDA may view the efficacy results in the context of safety as
not being supportive of licensure. Other regulatory authorities in Europe and other jurisdictions may make similar
findings with respect to these endpoints.
The FDA, the EMA or other comparable regulatory authorities may disagree with our regulatory plan and
we may fail to obtain regulatory approval of our product candidates.
If the results of our clinical trials are sufficiently compelling, we or our collaborators intend to discuss with the
FDA and regulatory authorities in other countries the submission of a BLA or respective applications in other
countries for our product candidates. However, we do not have any agreement or guidance from the FDA that
our regulatory development plans will be sufficient for submission of a BLA for any of our product candidates.
The FDA, the EMA or other regulatory agencies may grant accelerated approval for our product candidates and,
as a condition for accelerated approval, the FDA, the EMA or other regulatory agencies may require a sponsor of
a drug or biologic receiving accelerated approval to perform post-marketing studies to verify and describe the
predicted effect on irreversible morbidity or mortality or other clinical endpoint, and the drug or biologic may be
subject to withdrawal procedures by the FDA, the EMA or other regulatory agencies that are more accelerated
than those available for regular approvals. In addition, the standard of care may change with the approval of new
products in the same indications that we are studying. This may result in the FDA, the EMA or other regulatory
agencies requesting additional studies to show that our product candidate is superior to the new products.
Our clinical trial results may also not support approval. In addition, our product candidates could fail to receive
regulatory approval for many reasons, including the following:
–the FDA, the EMA or comparable regulatory authorities may disagree with the design or implementation of our
clinical trials;
–we may be unable to demonstrate to the satisfaction of the FDA, the EMA or comparable regulatory
authorities that our product candidates are safe and effective for any of their proposed indications;
–the results of clinical trials may not meet the level of statistical significance required by the FDA, the EMA or
comparable regulatory authorities for approval, including due to the heterogeneity of patient populations;
–we may be unable to demonstrate that our product candidates’ clinical and other benefits outweigh their safety
risks;
–the FDA, the EMA or comparable regulatory authorities may disagree with our interpretation of data from
preclinical studies or clinical trials;
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–the data collected from clinical trials of our product candidates may not be sufficient to the satisfaction of the
FDA, the EMA or comparable regulatory authorities to support the submission of a BLA or other comparable
submissions or to obtain regulatory approval in the United States or elsewhere;
–the FDA, the EMA or comparable regulatory authorities will inspect our manufacturing facilities and may not
approve our facilities or our manufacturing processes and controls;
–the approval policies or regulations of the FDA, the EMA or comparable regulatory authorities may significantly
change in a manner rendering our clinical data insufficient for approval; and
–appointees of the presidential administration in the United States may seek to change regulatory requirements
for the approval of products or the approach to the review of product applications.
We may not be able to file INDs with the FDA, clinical trial applications with the competent authorities of
the member states of the European Union or similar applications with other comparable regulatory
authorities to commence additional clinical trials on the timelines we expect, and even if we are able to,
one or more of these regulatory authorities may not permit us to proceed.
The timing of filing on our product candidates is dependent on further preclinical, clinical and manufacturing
success. We cannot be sure that submission of an IND or IND amendment with the FDA, a clinical trial
application with the regulatory authorities of the EU member states or similar application with other comparable
regulatory authorities will result in the FDA, the regulatory authorities of the EU member states or any
comparable regulatory authority allowing testing and clinical trials to begin, or that, once begun, issues will not
arise that result in the suspension or termination of such clinical trials. Additionally, even if such regulatory
authorities agree with the design and implementation of the clinical trials set forth in an IND, clinical trial
application or similar applications, we cannot guarantee that such regulatory authorities will not change their
requirements in the future.
We may seek Orphan Drug Designation for some or all of our product candidates across various
indications, but we may be unable to obtain such designations or to maintain the benefits associated
with Orphan Drug Designation, including market exclusivity, which may cause our revenue, if any, to be
reduced.
Our strategy includes filing for Orphan Drug Designation where available for our product candidates. Under the
U.S. Orphan Drug Act, the FDA may grant Orphan Drug Designation to a drug or biologic intended to treat a rare
disease or condition, which is defined as one occurring in a patient population of fewer than 200,000 in the
United States, or a patient population of 200,000 or greater in the United States where there is no reasonable
expectation that the cost of developing the drug or biologic will be recovered from sales in the United States. In
the United States, Orphan Drug Designation entitles a party to financial incentives, such as opportunities for
grant funding toward clinical trial costs, tax advantages, and user-fee waivers. In addition, if a product that has
Orphan Drug Designation subsequently receives the first FDA approval for the disease for which it has such
designation, the product is entitled to orphan drug exclusivity, which means that the FDA may not approve any
other applications, including a full new drug application or a BLA, to market the same drug or biologic for the
same indication for seven years, except in limited circumstances, such as a showing of clinical superiority to the
product with orphan drug exclusivity or where the original manufacturer is unable to assure sufficient product
quantity. Similar rules apply in the European Union with respect to drugs or biologics designated as orphan
medicinal products.
In addition, exclusive marketing rights in the United States may be limited if we seek approval for an indication
broader than the orphan-designated indication or may be lost if the FDA later determines that the request for
designation was materially defective. Further, even if we obtain orphan drug exclusivity for a product, that
exclusivity may not protect the product effectively from competition because different drugs with different active
moieties may receive and be approved for the same condition, and only the first applicant to receive approval will
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receive the benefits of marketing exclusivity. Even after an orphan-designated product is approved, the FDA can
subsequently approve a later drug with the same active moiety for the same condition if the FDA concludes that
the later drug is clinically superior if it is shown to be safer, more effective, or makes a major contribution to
patient care. Similar considerations apply in the European Union with respect to drugs or biologics designated as
orphan medicinal products. Orphan Drug Designation neither shortens the development time or regulatory
review time of a drug, nor gives the drug any advantage in the regulatory review or approval process. In addition,
while we may seek Orphan Drug Designation for our product candidates, we may never receive such
designations.
We may seek Breakthrough Therapy or Fast Track designation for one or more of our product
candidates, but we may not receive such designations. Even if we do, it may not lead to a faster
development or regulatory review or approval process, and it may not increase the likelihood that such
product candidates will receive marketing approval.
We may seek a Breakthrough Therapy Designation in the United States for one or more of our product
candidates. A breakthrough therapy is defined as a drug that is intended, alone or in combination with one or
more other drugs, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence
indicates that the drug may demonstrate substantial improvement over existing therapies on one or more
clinically significant endpoints, such as substantial treatment effects observed early in clinical development. For
drugs that have been designated as breakthrough therapies, interaction and communication between the FDA
and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing
the number of patients placed in ineffective control regimens. Drugs designated as breakthrough therapies by
the FDA are also eligible for priority review if supported by clinical data at the time of the submission of the BLA.
Although priority review shortens the goal date by which FDA intends to decide on an application, it does not
guarantee any particular action by FDA, or even FDA action by that date.
Designation as a breakthrough therapy is at the discretion of the FDA. Accordingly, even if we believe that one of
our product candidates meets the criteria for designation as a breakthrough therapy, the FDA may disagree and
instead determine not to make such designation. In any event, the receipt of a Breakthrough Therapy
Designation for a drug may not result in a faster development process, review or approval compared to drugs
considered for approval under conventional FDA procedures and it would not assure ultimate approval by the
FDA. In addition, even if one or more of our product candidates qualify as breakthrough therapies, the FDA may
later decide that the product candidate no longer meets the conditions for qualification or it may decide that the
time period for FDA review or approval will not be shortened.
We may also seek Fast Track Designation in the United States for some of our product candidates. If a therapy
is intended for the treatment of a serious or life-threatening condition and the therapy demonstrates the potential
to address significant unmet medical needs for this condition, the drug sponsor may apply for Fast Track
Designation. The FDA has broad discretion whether to grant this designation, and even if we believe a particular
product candidate is eligible for this designation, we cannot be sure that the FDA would decide to grant it. Even if
we do receive Fast Track Designation, we may not experience a faster development process, review or approval
compared to conventional FDA procedures. The FDA may withdraw Fast Track Designation if it believes that the
designation is no longer supported by data from our clinical development program. Fast Track Designation alone
does not guarantee qualification for the FDA’s priority review procedures.
We expect some of the product candidates we develop will be regulated as biologics in the United States
and therefore they may be subject to competition from biosimilars approved through an abbreviated
regulatory pathway.
The ACA includes a subtitle called the Biologics Price Competition and Innovation Act of 2009, or the BPCIA,
which created an abbreviated approval pathway for biological products that are biosimilar to or interchangeable
with an FDA-approved reference biological product. Under the BPCIA, an application for a biosimilar product
may not be submitted to the FDA until four years following the date that the reference product was first approved
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by the FDA. In addition, the approval of a biosimilar product may not be made effective by the FDA until 12 years
from the date on which the reference product was first approved.
During this 12-year period of exclusivity, another company may still market a competing version of the reference
product if the FDA approves a BLA for the competing product containing the sponsor’s own preclinical data and
data from adequate and well-controlled clinical trials to demonstrate the safety, purity and potency of the other
company’s product. The law is complex and is still being interpreted and implemented by the FDA. As a result, its
ultimate impact, implementation and meaning are subject to uncertainty.
We believe that any of our product candidates approved as a biological product under a BLA should qualify for a
12-year period of exclusivity. However, there is a risk that this exclusivity could be shortened due to
congressional action or otherwise, or that the FDA will not consider our product candidates to be reference
products for competing products, potentially creating the opportunity for generic competition sooner than
anticipated. Other aspects of the BPCIA, some of which may impact the BPCIA exclusivity provisions, have also
been the subject of recent litigation. Moreover, the extent to which a biosimilar, once approved, will be
substituted for any one of our reference products in a way that is similar to traditional generic substitution for
non-biological products is not yet clear, and will depend on a number of marketplace and regulatory factors that
are still developing.
The regulatory landscape that will govern our product candidates is uncertain. Regulations relating to
more established gene therapy and cell therapy products are still developing, and changes in regulatory
requirements could result in delays or discontinuation of development of our product candidates or
unexpected costs in obtaining regulatory approval.
The regulatory requirements to which our product candidates will be subject are not entirely clear. Even with
respect to more established products that fit into the categories of gene therapies or cell therapies, the regulatory
landscape is still developing. For example, regulatory requirements governing gene therapy products and cell
therapy products have changed frequently and may continue to change in the future. Moreover, there is
substantial, and sometimes uncoordinated, overlap in those responsible for regulation of existing gene therapy
products and cell therapy products. Although the FDA decides whether individual gene therapy protocols may
proceed, the review process and determinations of other reviewing bodies can impede or delay the initiation of a
clinical study, even if the FDA has reviewed the study and approved its initiation. Conversely, the FDA can place
an IND application on clinical hold even if such other entities have provided a favorable review. Furthermore,
gene therapy clinical trials are also subject to review and oversight by an institutional biosafety committee, a
local institutional committee that reviews and oversees basic and clinical research conducted at the institution
participating in the clinical trial. In addition, adverse developments in clinical trials of gene therapy products
conducted by others may cause the FDA or other regulatory bodies to change the requirements for approval of
any of our product candidates.
Complex regulatory environments exist in other jurisdictions in which we might consider seeking regulatory
approvals for our product candidates, further complicating the regulatory landscape. For example, in the
European Union, a special committee called the Committee for Advanced Therapies was established within the
EMA in accordance with Regulation (EC) No 1394/2007 on advanced-therapy medicinal products, or ATMPs, to
assess the quality, safety and efficacy of ATMPs, and to follow scientific developments in the field. ATMPs
include gene therapy products as well as somatic cell therapy products and tissue engineered products.
These various regulatory review committees and advisory groups and new or revised guidelines that they
promulgate from time to time may lengthen the regulatory review process, require us to perform additional
studies, increase our development costs, lead to changes in regulatory positions and interpretations, delay or
prevent approval and commercialization of our product candidates or lead to significant post-approval limitations
or restrictions. As the regulatory landscape for our CAR-T-cell immunotherapy product candidates is new, we
may face even more cumbersome and complex regulations than those emerging for gene therapy products and
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cell therapy products. Furthermore, even if our product candidates obtain required regulatory approvals, such
approvals may later be withdrawn as a result of changes in regulations or the interpretation of regulations by
applicable regulatory agencies.
Delay or failure to obtain, or unexpected costs in obtaining, the regulatory approval necessary to bring a potential
product to market could decrease our ability to generate sufficient product sales revenue to maintain our
business.
We may be unable to obtain regulatory approval for our product candidates under applicable
international regulatory requirements.
The denial or delay of such approval would delay commercialization of our product candidates and adversely
impact our potential to generate revenue, our business and our results of operations.
Approval by the FDA in the United States, if obtained, does not ensure approval by regulatory authorities in other
countries or jurisdictions. In order to market our products or product candidates in any other jurisdiction, we must
establish and comply with numerous and varying regulatory requirements on a jurisdiction-by-jurisdiction basis
regarding safety and efficacy. In addition, clinical trials conducted in one country may not be accepted by
regulatory authorities in other countries, and regulatory approval in one country does not guarantee regulatory
approval in any other country. Approval processes vary among countries and can involve additional product
testing and validation and additional administrative review periods.
Seeking regulatory approval in other jurisdictions could result in difficulties and costs for us and require
additional preclinical studies or clinical trials which could be costly and time-consuming. Regulatory requirements
can vary widely from country to country and could delay or prevent the introduction of our products in those
countries. The European Union and other jurisdictions’ regulatory approval processes involve all of the risks
associated with the FDA approval. If we fail to comply with regulatory requirements in certain markets or to
obtain and maintain required approvals, or if regulatory approvals in certain markets are delayed, our target
market will be reduced and our ability to realize the full market potential of our products will be unrealized.
Certain jurisdictions may have submission requirements for drug clinical trial and marketing applications that
require us or our partners to submit substantial detailed materials related to non-clinical and clinical development
and manufacturing and quality control to drug regulators or testing laboratories. This can include confidential
standard operating procedures or executed batch records for the production of biological products or other
records or documents that set forth detailed information about the manufacturing process and the manufacturing
site. If these materials are disclosed in an unauthorized manner, lost, or otherwise diverted to third parties or
competitors during the application preparation process, this could negatively affect our ability to protect our
intellectual property.
Our partners in different countries are subject to local regulatory requirements and standards on the
manufacturing and distribution of drugs and the implementation of clinical and non-clinical research. These
include but are not limited to good manufacturing, distribution, laboratory, clinical practice, and
pharmacovigilance rules. If these companies do not comply with applicable standards, they could become the
subjects of inspections, investigations and enforcement, including orders to cease the activities pending
remediation that is acceptable to the government. Such an order or other similar enforcement could interfere with
our clinical development and marketing activities both in that jurisdiction and others, if it impacts supply or the
quality and transfer of data.
A third-party investigational product candidate used in combination with our product candidates may be
unable to obtain regulatory approval, which may delay commercialization of our product candidates.
We are developing several of our product candidates to be used in combination with our and third-party product
candidates. Even if any product candidate we develop were to receive marketing approval or be commercialized
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for use in combination with other existing products, we would continue to be subject to the risks that the FDA, the
EMA or comparable regulatory authorities in other jurisdictions could revoke approval of the product used in
combination with our product or that safety, efficacy, manufacturing or supply issues could arise with any of those
existing products. If the products or product candidates we use in combination with our product candidates are
replaced as the standard of care for the indications we choose for any of our product candidates, the FDA, the
EMA or comparable regulatory authorities in other jurisdictions may require us to conduct additional clinical trials.
The occurrence of any of these risks could result in our own products, if approved, being removed from the
market or being less successful commercially. We also plan to evaluate current and future product candidates in
combination with one or more product candidates that have not yet been approved for marketing by the FDA, the
EMA or comparable regulatory authorities in other jurisdictions. We will not be able to market any product
candidate we develop in combination with an unapproved product candidate if that unapproved product
candidate does not ultimately obtain marketing approval. In addition, unapproved product candidates face the
same risks described with respect to our product candidates currently in development and clinical trials, including
the potential for serious adverse effects, delay in their clinical trials and lack of FDA, EMA or comparable
regulatory authority approval.
If the FDA, the EMA or comparable regulatory authorities in other jurisdictions do not approve these other
product candidates or revoke their approval of, or if safety, efficacy, manufacturing or supply issues arise with,
the products or product candidates we choose to evaluate in combination with any product candidate we
develop, we may be unable to obtain approval of or market any product candidate we develop.
Some of our product candidates are classified as gene therapies by the FDA and the EMA, and the FDA
has indicated that our product candidates will be reviewed within its Center for Biologics Evaluation and
Research, or CBER. Even though our mRNA product candidates are designed to have a different
mechanism of action from gene therapies, the association of our product candidates with gene therapies
could result in increased regulatory burdens, impair the reputation of our product candidates, or
negatively impact our platform or our business.
There have been few approvals of gene therapy products in the United States and other jurisdictions, and there
have been well-reported significant adverse events associated with their testing and use. Gene therapy products
have the effect of introducing new DNA and potentially irreversibly changing the DNA in a cell. In contrast, mRNA
is highly unlikely to localize to the nucleus, be reverse transcribed or integrated into the genome. Consequently,
we expect that our products or product candidates will have a different potential side effect profile from gene
therapies because they lack risks associated with altering cell DNA irreversibly. Further, we may avail ourselves
of ways of mitigating side effects in developing our products and product candidates to address safety concerns
that are not available to other products or product candidates classified as gene therapies, such as lowering the
dose of our products or product candidates during repeat dosing or stopping treatment to potentially ameliorate
undesirable side effects.
Regulatory requirements governing gene and cell therapy products have evolved and may continue to change in
the future, and the implications for mRNA-based therapies is unknown. For example, the FDA has established
the Office of Tissues and Advanced Therapies within CBER to consolidate the review of gene therapy and
related products, and convenes the Cellular, Tissue and Gene Therapies Advisory Committee to advise CBER
on its review. In the European Union, mRNA has been characterized as a gene therapy medicinal product. In
certain countries, mRNA therapies have not yet been classified or any such classification is not known to us.
Notwithstanding the differences between our mRNA product candidates and gene therapies, the classification of
some of our mRNA product candidates as gene therapies in the United States, the European Union and
potentially other counties could adversely impact our ability to develop our product candidates, and could
negatively impact our platform and our business. For instance, a potential future clinical hold on gene therapy
products across the field due to risks associated with altering cell DNA irreversibly could apply to our mRNA
product candidates irrespective of the mechanistic differences between gene therapies and mRNA.
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Adverse events reported with respect to gene therapies or genome editing therapies could adversely impact one
or more of our programs. Although our mRNA product candidates are designed not to make any permanent
changes to cell DNA, regulatory agencies or others could believe that adverse effects of gene therapy products
caused by introducing new DNA and irreversibly changing the DNA in a cell could also be a risk for our approved
mRNA products or investigational therapies, and as a result may delay one or more of our trials or impose
additional testing for long-term side effects. Any new requirements and guidelines promulgated by regulatory
review agencies may have a negative effect on our business by lengthening the regulatory review process,
requiring us to perform additional or larger studies, or increasing our development costs, any of which could lead
to changes in regulatory positions and interpretations, delay or prevent advancement or approval and
commercialization of our product candidates or lead to significant post-approval studies, limitations or
restrictions. As we advance our product candidates, we will be required to consult with these regulatory agencies
and advisory committees and comply with applicable requirements and guidelines. If we fail to do so, we may be
required to delay or discontinue development of some or all of our product candidates.
Our COVID-19 vaccine and any other product candidates for which we receive approval or emergency
use authorization are subject to continuing regulatory oversight, and we will be subject to ongoing
regulatory obligations and continued regulatory review, which may result in significant additional
expense. We may be subject to penalties if we fail to comply with regulatory requirements or experience
unanticipated problems with our products or product candidates.
Our COVID-19 vaccine and any other product candidates for which we receive approval or emergency use
authorization are subject to continuing regulatory oversight, including the review of additional safety information,
and the applicable regulatory authority may still impose significant restrictions on the indicated uses or marketing
of our product or impose ongoing requirements for potentially costly post-approval studies or post-market
surveillance. For example, the holder of an approved BLA is obligated to monitor and report adverse events and
any failure of a product to meet the specifications in the BLA. The holder of an approved BLA must also submit
new or supplemental applications and obtain FDA approval for certain changes to the approved product, product
labeling or manufacturing process. Similar requirements apply to holders of (conditional) approvals in other
countries. Advertising and promotional materials must comply with FDA rules and are subject to FDA review, in
addition to other potentially applicable federal and state laws. In other countries outside of the United States,
advertising and promotional material may be subject to similar or more onerous rules. For example, direct-to-
consumer advertising of prescription medicinal products is prohibited in many jurisdictions outside of the United
States, including the European Union.
If we fail to comply with applicable regulatory requirements following approval of any of our product candidates, a
regulatory agency may:
–issue adverse public statements about our business or products;
–issue a warning letter asserting that we are in violation of the law;
–seek an injunction or impose civil or criminal penalties or monetary fines;
–suspend or withdraw regulatory approval or revoke a license;
–suspend any ongoing clinical studies;
–refuse to approve a pending BLA (or comparable approval) or supplements to a BLA (or comparable approval)
submitted by us;
–seize product; or
–refuse to allow us to enter into supply contracts, including government contracts.
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Any government investigation of alleged violations of law could require us to expend significant time and
resources in response and could generate negative publicity. The occurrence of any event or penalty described
above may inhibit our ability to commercialize any approved products and generate revenues.
If any of our products or product candidates cause undesirable side effects, it could delay or prevent their
regulatory approval, limit their commercial potential, or result in significant negative consequences following any
potential marketing approval. Products or product candidates we may develop may be associated with an
adverse immune response or other serious adverse events, undesirable side effects or unexpected
characteristics. In addition to serious adverse events or side effects caused by any of our products or product
candidates, the administration process or related procedures also can cause undesirable side effects. If any
such events occur, the clinical trials of any of our product candidates could be suspended or terminated.
If in the future we are unable to demonstrate that such adverse events were caused by factors other than our
product candidate, the FDA, the EMA or other regulatory authorities could order us to cease further development
of, or deny approval of, any of our product candidates for any or all targeted indications. Even if we are able to
demonstrate that all future serious adverse events are not product-related, such occurrences could affect patient
recruitment or the ability of enrolled trial participants to complete the trial. Moreover, if we elect, or are required,
to delay, suspend or terminate any clinical trial of any of our product candidates, the commercial prospects of
such product candidates, if approved, may be harmed and our ability to generate product sale revenues from
any of these product candidates may be delayed or eliminated. Any of these occurrences may harm our ability to
identify and develop product candidates, and may harm our business, financial condition, result of operations
and prospects significantly.
Additionally, following regulatory approval of a product candidate, the FDA or other regulatory authority could
require us to adopt a REMS or a risk management plan to ensure that the benefits of treatment with such
product candidate outweigh the risks for each potential patient, which may include, among other things, a
medication guide outlining the risks of the product for distribution to patients, a communication plan to health
care practitioners, extensive patient monitoring, or distribution systems and processes that are highly controlled,
restrictive, and more costly than what is typical for the industry.
Furthermore, if we or others later identify undesirable side effects caused by any product that we develop,
several potentially significant negative consequences could result, including:
–regulatory authorities may suspend or withdraw approvals or revoke licenses of such product;
–regulatory authorities may require additional warnings on the label;
–regulatory authorities may make unfavorable statements about the safety of our products;
–we may be required to change the way a product is administered or conduct additional clinical trials;
–we could be sued and held liable for harm caused to patients and their children; and
–our reputation may suffer.
Any of these events could prevent us from achieving or maintaining market acceptance of any products we may
identify and develop and could have a material adverse effect on our business, financial condition, results of
operations and prospects.
Upon the successful approval of a product candidate, we will continue to face significant regulatory oversight of
its manufacturing and distribution. Product manufacturers and their facilities are subject to payment of user fees
and continual review and periodic inspections by the FDA and other regulatory authorities for compliance with
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GMP and adherence to commitments made in the BLA or comparable approval. If we or a regulatory agency
discovers previously unknown problems with a product such as adverse events of unanticipated severity or
frequency, or problems with the facility where the product is manufactured, a regulatory agency may impose
restrictions relative to that product or the manufacturing facility, including requiring recall or withdrawal of the
product from the market or suspension of manufacturing.
Governmental investigations and inquiries with respect to our COVID-19 vaccine and any other product
candidates for which we receive approval or emergency use authorization may adversely affect our
business, financial condition and results of operations.
In April 2025, we, along with several other pharmaceutical companies, received a letter from the Chairman of the
Permanent Subcommittee on Investigations of the U.S. Senate Homeland Security and Governmental Affairs
Committee, or the Subcommittee, that requested certain information and documents relating to the respective
COVID-19 vaccines we developed (in our case, Comirnaty). This and other governmental investigations or
inquiries in which we may become involved may result in additional claims and lawsuits being brought against us
by governmental agencies or private parties. It is not possible at this time to predict either the outcome or the
potential financial impact of the congressional investigation mentioned above or any further investigations or
inquiries of us that may result from such investigation. It is also not possible at this time to predict the additional
expenses related to such investigation, which may be significant. The initiation of any additional investigation
relating to us, the costs and expenses associated therewith, or any assertion, claim or finding of wrongdoing by
us, could:
–adversely affect our business, financial condition and results of operations;
–result in reputational harm and reduced market acceptance and demand for our products;
–harm our ability and our commercial partners’ ability to market our products;
–harm our ability to develop our product candidates;
–cause us to incur significant liabilities, costs and expenses; and
–cause our senior management to be distracted from execution of our business strategy.
Furthermore, the pending congressional investigation could negatively affect our ability to raise capital and
impair our ability to engage in strategic transactions.
We may be subject, directly or indirectly, to federal and state healthcare fraud and abuse laws, false
claims laws, and other healthcare laws. If we are unable to comply, or have not fully complied, with such
laws, we could face substantial penalties.
We may be subject to additional healthcare regulation and enforcement by the U.S. federal government and by
authorities in the United States, the European Union and other jurisdictions in which we conduct our business.
Our operations may be directly, or indirectly through our prescribers, customers and purchasers, subject to
various federal and state fraud and abuse laws and regulations, including, without limitation, the federal Health
Care Program Anti-Kickback Statute, the federal civil and criminal False Claims Act, and the Physician Payments
Sunshine Act and regulations. Many states and other jurisdictions have similar laws and regulations, some of
which may be broader in scope. These laws will impact, among other things, our proposed sales, marketing and
educational programs. In addition, we may be subject to patient privacy laws enacted by both the federal
government and the states in which we conduct our business. The laws that will affect our operations include,
but are not limited to the following:
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–The U.S. federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from
knowingly and willfully soliciting, receiving, offering or paying any remuneration (including any kickback, bribe
or rebate), directly or indirectly, overtly or covertly, in cash or in kind, in return for the purchase,
recommendation, leasing or furnishing of an item or service reimbursable under a federal healthcare program,
such as the Medicare and Medicaid programs. This statute has been interpreted to apply to arrangements
between pharmaceutical manufacturers on the one hand, and prescribers, purchasers, and formulary
managers on the other. The ACA amends the intent requirement of the federal Anti-Kickback Statute to
provide that a person or entity no longer needs to have actual knowledge of this statute or specific intent to
violate it;
–The U.S. federal civil and criminal false claims laws and civil monetary penalty laws, which prohibit, among
other things, individuals or entities from knowingly presenting, or causing to be presented, false or fraudulent
claims for payment or approval from Medicare, Medicaid or other government payors. The ACA provides, and
recent government cases against pharmaceutical and medical device manufacturers support, the view that
federal Anti-Kickback Statute violations and certain marketing practices, including off-label promotion, may
implicate the False Claims Act;
–The U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created new
federal criminal statutes that prohibit a person from knowingly and willfully executing a scheme or making
false or fraudulent statements to defraud any healthcare benefit program, regardless of the payor (e.g., public
or private);
–HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act and their
implementing regulations, which imposes certain requirements relating to the privacy, security and
transmission of individually identifiable health information without appropriate authorization by entities subject
to the rule, such as health plans, health care clearinghouses and health care providers;
–The U.S. Federal Food, Drug, and Cosmetic Act, which prohibits, among other things, the adulteration or
misbranding of drugs, biologics and medical devices;
–The U.S. Public Health Service Act, which prohibits, among other things, the introduction into interstate
commerce of a biological product unless a biologics license is in effect for that product;
–Federal transparency laws, including the federal Physician Payment Sunshine Act, which require disclosure of
payments and other transfers of value provided to physicians and teaching hospitals, and ownership and
investment interests held by physicians and other healthcare providers and their immediate family members
and applicable group purchasing organizations;
–U.S. state law equivalents of each of the above federal laws, state laws that require drug manufacturers to
report information related to payments and other transfers of value to physicians and other healthcare
providers or marketing expenditures, and state laws governing the privacy and security of health information in
certain circumstances which are also applicable to us, and many of them differ from each other in significant
ways and may not have the same effect, thus complicating compliance efforts in certain circumstances;
–The U.S. Foreign Corrupt Practices Act of 1977, as amended, which prohibits, among other things, U.S.
companies and their employees and agents, as well as non-U.S. companies that are registered with the SEC,
from authorizing, promising, offering or providing, directly or indirectly, corrupt or improper payments or
anything else of value to foreign government officials, employees of public international organizations and
foreign government owned or affiliated entities, candidates for foreign political office, and foreign political
parties or officials thereof; and
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–Similar statutes, healthcare laws and regulations in the European Union and other jurisdictions, including
reporting requirements detailing interactions with and payments to healthcare providers.
Due to the breadth of these laws and the narrowness of the statutory exceptions and safe harbors available, it is
possible that some of our business activities could be subject to challenge under one or more of such laws. If our
operations are found to be in violation of any of the laws described above or any other government regulations
that apply to us, we may be subject to penalties, including civil and criminal penalties, damages, fines, exclusion
from participation in government health care programs, such as Medicare and Medicaid, imprisonment, and the
curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our
business and our results of operations.
The provision of benefits or advantages to physicians to induce or encourage the prescription, recommendation,
endorsement, purchase, supply, order or use of medicinal products is prohibited in the European Union. The
provision of benefits or advantages to physicians is also governed by the national anti-bribery laws of European
Union member states and other jurisdictions, such as the U.K. Bribery Act 2010. Infringement of these laws
could result in substantial fines and imprisonment.
Payments made to physicians in certain EU member states must be publicly disclosed. Moreover, agreements
with physicians often must be the subject of prior notification and approval by the physician’s employer, his or
her competent professional organization or the regulatory authorities of the individual EU member states. These
requirements are provided in the national laws, industry codes, or professional codes of conduct, applicable in
the EU member states. Failure to comply with these requirements could result in reputational risk, public
reprimands, administrative penalties, fines or imprisonment.
We are subject to certain anti-corruption, anti-money laundering, export control, sanctions, and other
trade laws and regulations. We can face serious consequences for violations.
Among other matters, anti-corruption, anti-money laundering, export control, sanctions, and other trade laws and
regulations, which are collectively referred to as “trade laws,” prohibit companies and their employees, agents,
CROs, legal counsel, accountants, consultants, contractors and other collaborators from authorizing, promising,
offering, providing, soliciting, or receiving directly or indirectly, corrupt or improper payments or anything else of
value to or from recipients in the public or private sector. Violations of trade laws can result in substantial criminal
fines and civil penalties, imprisonment, the loss of trade privileges, debarment, tax reassessments, breach of
contract and fraud litigation, reputational harm, and other consequences. We have direct or indirect interactions
with officials and employees of government agencies or government-affiliated hospitals, universities and other
organizations. We plan to engage third parties for clinical trials and/or to obtain necessary permits, licenses,
intellectual property (including patents) and other regulatory approvals, and we can be held liable for the corrupt
or other illegal activities of our personnel, agents or collaborators, even if we do not explicitly authorize or have
prior knowledge of such activities.
We are subject to stringent privacy laws, information security policies and contractual obligations
governing the use, processing, and cross-border transfer of personal information and our data privacy
and security practices.
We receive, generate and store significant and increasing volumes of sensitive information, such as employee,
personal and patient data.
We are subject to a variety of local, state, national and international laws, directives and regulations that apply to
the collection, use, storage, retention, protection, disclosure, transfer and other processing of personal data,
collectively referred to as “data processing”, in the different jurisdictions in which we operate, including
comprehensive regulatory systems in the United States and Europe. Legal requirements relating to data
processing continue to evolve and may result in ever-increasing public scrutiny and escalating levels of
enforcement, sanctions and increased costs of compliance.
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Compliance with U.S. and international data protection laws and regulations could cause us to incur substantial
costs or require us to change our business practices and compliance procedures in a manner adverse to our
business. Moreover, complying with these various laws could require us to take on more onerous obligations in
our contracts, restrict our ability to collect, use and disclose data, or in some cases, impact our ability to operate
in certain jurisdictions. Failure to comply with U.S. and international data protection laws and regulations could
result in 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. Claims that we have violated
individuals’ privacy rights, failed to comply with data protection laws, or breached our contractual obligations,
even if we are not found liable, could be expensive and time consuming to defend, could result in adverse
publicity and could have a material adverse effect on our business, financial condition and results of operations.
The collection and use of personal data in the European Union had previously been governed by the provisions
of the EU Data Protection Directive, which EU member states were required to implement. While the Data
Protection Directive did not apply to organizations based outside the European Union, the GDPR has expanded
its reach to include any business, regardless of its location, that targets goods or services to residents in the
European Union or that “monitors” their behavior in the European Union. The GDPR imposes strict requirements
on controllers and processors of personal data, including special protections for “sensitive information” which
includes health and genetic information of patients residing in the European Union. The GDPR also imposes
strict rules on the transfer of personal data out of the European Union to the United States and other countries.
In addition, the GDPR provides that EU member states may make their own further laws and regulations limiting
the processing of personal data, including genetic, biometric or health data.
Since we are located in the European Union, we are subject to the GDPR. Additionally, as the GDPR applies
extraterritorially, we are also subject to the GDPR even where our data processing activities occur outside of the
European Union if such activities involve the personal data of individuals located in the European Union and the
above-mentioned applicable law triggers apply. GDPR regulations have imposed additional responsibility and
liability in relation to the personal data that we process and we may be required to put in place additional
mechanisms to ensure compliance with the new data protection rules. This may be onerous and may interrupt or
delay our development activities, and adversely affect our business, financial condition, results of operations and
prospects.
Other jurisdictions outside the European Union are similarly introducing or enhancing privacy and data security
laws, rules and regulations, which could increase our compliance costs and the risks associated with non-
compliance. In particular, in China, where some of our clinical data are originated, the cybersecurity, data
privacy, data protection, or other data-related laws and regulations, including the Personal Information Protection
Law, Regulations on Network Data Security Management, Provisions on Promoting and Regulating Cross-
Border Data Flows, and Human Genetic Resources Regulation (which regulates the collection and transfer
human biospecimens and genetic data derived from them in clinical research to foreign or foreign controlled
parties), may require approvals or filings prior to transferring those data to foreign-owned or controlled entities in
China or overseas, and these regimes are continually evolving, meaning their interpretation and enforcement
may be uncertain. These rules establish mechanisms such as governmental security assessment, certification,
and standard contractual clauses for certain cross‑border data transfers. Depending on the nature and volume of
data processed in China, we or our partners may be required to complete one or more of these transfer
mechanisms as a condition to exporting relevant data. Compliance with these requirements could affect our
operations, including data flows necessary for clinical development, manufacturing, or other activities conducted
in China. The scope and practical application of these rules continue to develop, and there is uncertainty
regarding how regulators will apply them in specific circumstances. In the United States, we may be subject to
restrictions and requirements under the Department of Justice’s Final Rule issued on December 27, 2024
implementing the Executive Order on Preventing Access to Americans’ Bulk Sensitive Personal Data and United
States Government-Related Data by Countries of Concern, signed on February 28, 2024. Practices regarding
the collection, use, storage, transmission and security of personal information by companies have also been
subject to increasing regulatory focus. As such, we cannot assure you that we will be compliant with such new
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regulations in all respects, and we may be ordered to rectify and terminate any actions that are deemed illegal by
the government authorities and become subject to fines and other government sanctions, which may materially
and adversely affect our business, financial condition, and results of operations. In addition, the uncertainties
regarding further interpretation and implementation of these laws and regulations may adversely affect the
secure storage of documented work as well as the cross-border transfer of important data and personal
information originated from our clinical trial activities, which are critical to the development of our pipelines.
We cannot guarantee that we are, or will be, in compliance with all applicable international regulations as they
are enforced now or as they evolve. For example, our privacy policies may be insufficient to protect any personal
information we collect, or may not comply with applicable laws, in which case we may be subject to regulatory
enforcement actions, lawsuits or reputational damage, all of which may adversely affect our business. There is
significant uncertainty related to the manner in which data protection authorities will seek to enforce compliance
with the GDPR and other international data protection regulations, especially with regard to clinical trial activities.
For example, it is not clear if the authorities will conduct random audits of companies doing business in the
European Union, or if the authorities will wait for complaints to be filed by individuals who claim their rights have
been violated, as enforcement practices vary from country to country. Enforcement uncertainty and the costs
associated with ensuring GDPR compliance may be onerous and adversely affect our business, financial
condition, results of operations and prospects. If we fail to comply with the GDPR and the applicable national
data protection laws of the EU member states, or if regulators assert we have failed to comply with these laws, it
may lead to regulatory enforcement actions, which can result in monetary penalties of up to €20,000,000 or up to
4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, and other
administrative penalties. If any of these events were to occur, our business and financial results could be
significantly disrupted and adversely affected.
Although we take measures to protect sensitive data from unauthorized access, use or disclosure, our
information technology and infrastructure may be vulnerable to attacks by hackers or viruses or breached due to
employee error, malfeasance or other malicious or inadvertent disruptions. Any such breach or interruption could
compromise our networks and the information stored there could be accessed by unauthorized parties,
manipulated, publicly disclosed, lost or stolen. Any such access, breach or other loss of information could result
in legal claims or proceedings, and liability under federal or state laws that protect the privacy of personal
information, as well as regulatory penalties. In many jurisdictions, there are legal requirements to provide notice
of breaches to affected individuals and/or regulators in certain circumstances. Such a notice could harm our
reputation and our ability to compete. Regulators may also have the discretion to impose penalties without
attempting to resolve violations through informal means. Although we have implemented security measures to
prevent unauthorized access to patient data, such data is currently accessible through multiple channels, and
there is no guarantee we can protect our data from breach. Unauthorized access, loss or dissemination could
also damage our reputation or disrupt our operations, including our ability to conduct our analyses, deliver test
results, process claims and appeals, provide customer assistance, conduct research and development activities,
collect, process and prepare company financial information, provide information about our tests and other patient
and physician education and outreach efforts through our website, and manage the administrative aspects of our
business.
If we or our third-party suppliers fail to comply with environmental, health and safety laws and
regulations, we could become subject to fines or penalties or incur costs that could harm our business.
We are subject to numerous environmental, health and safety laws and regulations, including those governing
laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and
wastes. Our operations involve the use of hazardous and flammable materials, including chemicals and
biological materials. Our operations also may produce hazardous waste products. We generally anticipate
contracting with third parties for the disposal of these materials and wastes. We will not be able to eliminate the
risk of contamination or injury from these materials. In the event of contamination or injury resulting from any use
by us of hazardous materials, we could be held liable for any resulting damages, and any liability could exceed
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our resources. We also could incur significant costs associated with civil or criminal fines and penalties for failure
to comply with such laws and regulations.
Although we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to
injuries to our employees resulting from the use of hazardous materials, this insurance may not provide
adequate coverage against potential liabilities.
In addition, we may incur substantial costs in order to comply with current or future environmental, health and
safety laws and regulations. These current or future laws and regulations may impair our research, development
or production efforts. Our failure to comply with these laws and regulations also may result in substantial fines,
penalties or other sanctions.
Our business operations and current and future relationships with investigators, healthcare
professionals, consultants, third-party payors, patient organizations and customers will be subject to
applicable healthcare regulatory laws, which could expose us to penalties.
Our business operations and current and future arrangements with investigators, healthcare professionals,
consultants, third-party payors, patient organizations and customers, may expose us to broadly applicable fraud
and abuse and other healthcare laws and regulations. These laws may constrain the business or financial
arrangements and relationships through which we conduct our operations, including how we research, market,
sell and distribute our product candidates, if approved.
Ensuring that our internal operations and future business arrangements with third parties comply with applicable
healthcare laws and regulations will involve substantial costs. It is possible that governmental authorities will
conclude that our business practices do not comply with current or future statutes, regulations, agency guidance
or case law involving applicable fraud and abuse or other healthcare laws and regulations.
If any of the physicians or other providers or entities with whom we expect to do business are found to not be in
compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including
exclusions from government-funded healthcare programs and imprisonment, which could affect our ability to
operate our business. Further, defending against any such actions can be costly and time-consuming and may
require significant personnel resources. Therefore, even if we are successful in defending against any such
actions that may be brought against us, our business may be impaired.
Risks Related to Ownership of the ADSs
We have experienced and may continue to experience significant volatility in the market price of the
ADSs representing our ordinary shares.
Biopharmaceutical companies such as BioNTech SE that are developing potential therapeutics and vaccines to
combat COVID-19, as well as conducting mRNA-based research in oncology and infectious disease more
generally, have experienced significant volatility in the price of their securities upon publication of preclinical and
clinical data as well as news about their development programs and commercialization activities. For example,
during 2025, the closing sales price of the ADSs representing our ordinary shares on the Nasdaq Global Select
Market ranged from $86.65 to $126.88. In addition, volatility in the overall market and in the market price of a
particular company’s securities can result in securities litigation, including shareholder class action lawsuits. Any
securities litigation can result in substantial costs and a diversion of our management’s attention and resources.
Acquisitions, joint ventures and collaborations may increase our capital requirements, dilute our
shareholders, cause us to incur debt or assume contingent liabilities, and subject us to other risks. We
may not realize the benefits of these acquisitions, joint ventures or collaborations.
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We may evaluate various acquisitions and collaborations, including licensing or acquiring complementary
products, intellectual property rights, technologies or businesses. Any potential acquisition, joint venture or
collaboration may entail numerous risks, including:
–increased operating expenses and cash requirements;
–the assumption of additional indebtedness or contingent liabilities;
–assimilation of operations, intellectual property and products of an acquired company, including difficulties
associated with integrating new personnel;
–the diversion of our management’s attention from our existing product programs and initiatives in pursuing
such a strategic merger or acquisition;
–retention of key employees, the loss of key personnel, and uncertainties in our ability to maintain key business
relationships;
–risks and uncertainties associated with the other party to such a transaction, including the prospects of that
party and their existing products or product candidates and regulatory approvals, their quality control, quality
assurance, internal controls, legal and compliance procedures; and
–our inability to generate revenue from acquired technology or products sufficient to meet our objectives in
undertaking the acquisition or even to offset the associated acquisition and maintenance costs.
In addition, if we undertake acquisitions, we may utilize our cash, issue dilutive securities, assume or incur debt
obligations, incur large one-time expenses and acquire intangible assets that could result in significant future
amortization expense. For example, in July 2023, we acquired InstaDeep, a leading global technology company
in the field of AI and machine learning, for upfront consideration of cash and BioNTech shares, and potential
future milestone payments. Although we believe that AI and machine learning technology has the potential to
accelerate the development of therapeutic programs and further optimize manufacturing and supply chain
processes, it is possible that our use of the acquired technology will not achieve the desired results, and that we
will not be able to retain and grow InstaDeep’s business around the world. If demand for the services developed
by InstaDeep does not continue, or if we are unable to improve our AI and machine learning technology in a
timely, effective and competitive manner, we may not be able realize the expected outcomes from the InstaDeep
acquisition. In January 2025, we acquired Biotheus, a clinical-stage biotechnology company, for upfront
consideration predominantly of cash, with a small portion in our ADSs, and potential future milestone payments.
Although the Biotheus acquisition expands our operations in China, our expectations regarding the creation of
long-term value for shareholders and potential future commercialization in oncology may not be realized. In
December 2025, we acquired CureVac N.V., a biotechnology company focused on the development of mRNA
therapeutics, through a public exchange offer. While we believe the acquisition has the potential to enhance our
capabilities in mRNA research, development, manufacturing and commercialization, there can be no assurance
that we will realize the anticipated benefits from the transaction. There is no guarantee that we will realize any
anticipated benefits of these or future acquisitions, or that the diversification of our business through acquired
technology or products will be successful.
Moreover, we may not be able to locate suitable acquisition or collaboration opportunities and this inability could
impair our ability to grow or obtain access to technology or products that may be important to the development of
our business.
Following the acquisition of CureVac, we may be required to repay monies received under the Advance
Purchase Agreement with the European Commission for its first-generation COVID-19 vaccine
candidate.
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On November 30, 2020, prior to our acquisition of CureVac, CureVac AG entered into an Advance Purchase
Agreement, which we refer to as the APA, with the EU Commission, acting on behalf of all Member States of the
European Union, for the supply of up to 405 million doses of its first-generation COVID-19 vaccine candidate,
which we refer to as CVnCoV. Under the APA, CureVac AG received an upfront payment of €450 million for
development and commercial supply activities of CVnCoV. In October 2021, CureVac AG notified the EU
Commission of the withdrawal of its regulatory approval application for CVnCoV, which notification automatically
terminated the APA. According to the APA, in such case of termination, CureVac AG would be required to return
any unspent amount of the upfront payment. In the context of the APA, “spent” means either costs incurred, or
commitments made in connection with the purposes set forth in the APA.
On July 24, 2024, the EU Commission informed CureVac SE that it had engaged Deloitte, S.L., which we refer to
as Deloitte, to conduct an audit of CureVac SE’s compliance with the APA. On September 17, 2025, the EU
Commission provided CureVac SE with Deloitte’s draft audit report, which included preliminary findings alleging
missing documentation, absence of project cost allocation, cost traceability and reconciliations, as well as
inconsistencies between information submitted during the audit and financial information previously provided to
the EU Commission. CureVac SE is cooperating fully with the EU Commission and Deloitte and submitted a
detailed response and objections on October 17, 2025. The EU Commission subsequently issued its final audit
report.
CureVac SE contested the findings in Deloitte’s draft audit report and believes it can refute the issues raised.
However, it remains uncertain to what extent Deloitte and the EU Commission will accept CureVac SE’s position.
It is also unclear whether the EU Commission will rely on Deloitte’s final audit report to seek recovery of any
portion or all of the €450 million upfront payment. As the successor to CureVac following the acquisition, we
cannot exclude the possibility of being required to repay a portion or all of the €450 million upfront payment.
Should we be unsuccessful in contesting any such repayment claims, or the payment of related fines, this could
materially affect our financial position, cash flows, and results of operations.
Our Articles of Association designate specific courts in the United States as the exclusive forum for
certain U.S. litigation that may be initiated by our shareholders, which could limit our shareholders’
ability to obtain a favorable judicial forum for disputes with us.
Our Articles of Association provide that the United States District Court for the Southern District of New York shall
be the competent court of jurisdiction for the resolution of any litigation on the grounds of or in connection with
U.S. federal or state capital market laws. In the absence of these provisions, under the Securities Act of 1933, as
amended, or the Securities Act, U.S. federal and state courts have been found to have concurrent jurisdiction
over suits brought to enforce duties or liabilities created by the Securities Act.
The choice of forum provision contained in our Articles of Association may limit a shareholder’s ability to bring a
claim in a judicial forum that it finds favorable for disputes with us or our executive officers, directors, or other
employees, or impose additional litigation costs on shareholders in pursuing any such claims, particularly if the
shareholders do not reside in or near the state of New York, which may discourage such lawsuits. In addition,
while the Delaware Supreme Court ruled in March 2020 that federal forum selection provisions purporting to
require claims under the Securities Act be brought in federal court are “facially valid” under Delaware law, there
is uncertainty as to whether other U.S. or German courts will enforce our choice of forum provision. The
enforceability of similar choice of forum provisions in other companies’ governing documents has been
challenged in recent legal proceedings, and it is possible that a court in the relevant jurisdictions with respect to
us could find the choice of forum provision contained our Articles of Association to be inapplicable or
unenforceable. If the relevant court were to find the choice of forum provision contained in our articles of
association to be inapplicable or unenforceable, we may incur additional costs associated with resolving such
matters in other jurisdictions, which could adversely affect our business, financial condition and operating results.
The choice of forum provision may also impose additional litigation costs on shareholders who assert that the
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provision is not enforceable or invalid. The United States District Court for the Southern District of New York may
also reach different judgments or results than would other courts, including courts where a shareholder
considering a U.S.-based action may be located or would otherwise choose to bring the action, and such
judgments may be more or less favorable to us than our shareholders.
Holders of the ADSs may not be able to participate in any future preemptive subscription rights issues
or elect to receive dividends in shares, which may cause additional dilution to their holdings.
Under German law, the existing shareholders of a company generally have a preemptive right in proportion to
the amount of shares they hold in connection with any issuance of ordinary shares, convertible bonds, bonds
with warrants, profit participation rights and participating bonds. However, our shareholders in a shareholders’
meeting may vote, by a majority representing at least three-quarters of the share capital represented at the
meeting, to waive this preemptive right provided that, from the company’s perspective, there exists good and
objective cause for such waiver.
The deposit agreement provides that the depositary need not make rights available to you unless the distribution
to ADS holders of both the rights and any related securities are either registered under the Securities Act or
exempted from registration under the Securities Act. We are under no obligation to file a registration statement
with respect to any such rights or securities or to endeavor to cause such a registration statement to be declared
effective. Moreover, we may not be able to establish an exemption from registration under the Securities Act.
Accordingly, ADS holders may be unable to participate in our future rights offerings and may experience dilution
in their holdings. For example, ADS holders were unable to participate in our summer 2020 rights offering. In
addition, if the depositary is unable to sell rights that are not exercised or not distributed or if the sale is not lawful
or reasonably practicable, it will allow the rights to lapse, in which case you will receive no value for these rights.
The amount and frequency of our dividends and ADS repurchases may fluctuate.
The amount, timing and execution of any ADS repurchase program we conduct in the future and the amount and
timing of any dividends we pay may fluctuate based on our priorities for the use of cash for other purposes, and
any ADS repurchases would be subject to the parameters contained in the applicable repurchase plan. These
purposes may include operational spending, capital spending, acquisitions and repayment of debt. Additionally,
we may choose to repurchase ADSs so that such ADSs may be used to settle outstanding and future equity
awards granted to our employees. Changes in cash flows, tax laws and the price of the ADSs could also impact
any ADS repurchase program. Additionally, we may enter into a Rule 10b5-1 trading plan governing the
repurchases, and if we do, we would have no discretion over the particular purchases made and would only be
able to set minimum price floors and maximum ADS count ceilings.
Our principal shareholders and management own a significant percentage of our ordinary shares and
will be able to exert significant control over matters subject to shareholder approval.
Our executive officers, directors, five percent shareholders, and their affiliates beneficially own a majority of our
ordinary shares (including ordinary shares represented by ADSs) as of December 31, 2025, and will have the
ability to influence us through their ownership positions. For example, these shareholders, acting together, may
be able to exert significant influence over matters such as elections of directors, amendments of our
organizational documents, or approval of any merger, sale of assets or other major corporate transaction. This
may prevent or discourage unsolicited acquisition proposals or offers for our ordinary shares that shareholders
may believe are in their best interest. Such insiders may also act in concert to waive rights to participate in rights
offerings, as was done in our summer 2020 rights offering, which would have the effect of permitting the ADSs or
shares underlying such waived rights to be offered to the public in an underwritten offering without contravening
German law pricing requirements.
The large number of shares eligible for sale or subject to rights requiring us to register them for sale
could cause the market price of the ADSs to drop significantly, even if our business is performing well.
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We have filed registration statements on Form S-8 under the Securities Act to register all ordinary shares issued
or issuable under our equity plans. Such Form S-8 registration statements have become, and any other
registration statements on Form S-8 we file in the future will become, effective upon filing, upon which shares
registered under such registration statements become available for sale in the open market.
Additionally, certain sales of ADSs or our ordinary shares that we have made have included, and we may in the
future make sales including, holding period restrictions or registration rights. Sales of ADSs or our ordinary
shares as restrictions end or pursuant to registration rights may make it more difficult for us to finance our
operations through the sale of equity securities in the future at a time and at a price that we deem appropriate.
These sales also could cause the trading price of the ADSs to fall and make it more difficult to sell the ADSs on
favorable terms.
If we are a “passive foreign investment company” for U.S. federal income tax purposes, there may be
adverse U.S. federal income tax consequences to U.S. investors.
Based on our income and assets, we believe that we should be treated as a “passive foreign investment
company,” or PFIC, for the preceding taxable year. However, the determination of our PFIC status is made
annually based on the factual tests described below. Consequently, while we may be a PFIC in future years, we
cannot estimate with certainty at this stage whether or not we are likely to be treated as a PFIC in the current
taxable year or any future taxable years. Generally, if, for any taxable year, at least 75 percent of our gross
income is “passive income” or at least 50 percent of our gross assets during the taxable year (based on the
average of the fair market values of the assets determined at the end of each quarterly period) are assets that
produce or are held for the production of passive income, we will be characterized as a PFIC for U.S. federal
income tax purposes. Passive income for this purpose generally includes, among other things, dividends,
interest, rents, royalties, gains from commodities and securities transactions, and gains from assets that produce
passive income. However, rents and royalties received from unrelated parties in connection with the active
conduct of a trade or business should not be considered passive income for purposes of the PFIC test. For
example, if we were to be characterized as a PFIC for U.S. federal income tax purposes in any taxable year
during which a U.S. Holder (as defined in “Taxation —Material United States federal income tax considerations”
in this Annual Report) holds ordinary shares or ADSs, such U.S. Holder could be subject to additional taxes and
interest charges upon certain distributions by us and any gain recognized on a sale, exchange or other
disposition of our shares, whether or not we continue to be characterized as a PFIC. Certain adverse
consequences of PFIC status can be mitigated if a U.S. Holder makes a “mark to market” election or a “Qualified
Electing Fund,” or QEF, election. We have made available to U.S. Holders the information necessary to make
and maintain a QEF election for the year ended December 31, 2024, and intend to provide U.S. holders with the
necessary information for any taxable year in which we are treated as a PFIC. See “Taxation —Material United
States federal income tax considerations —Passive foreign investment company considerations” in this Annual
Report.
Whether we are a PFIC for any taxable year will depend on the composition of our income and the composition
and value of our assets from time to time. Each U.S. Holder is strongly urged to consult their tax advisor
regarding these issues and any available elections to mitigate such tax consequences.
The acquisition of a substantial interest in the Company by non-EU/non-EFTA investors requires
government approval, which may restrict certain investments and limit demand for the BioNTech ADSs.
As the Company is considered an operator of “critical infrastructure” within the meaning of the Ordinance on the
Designation of Critical Infrastructure pursuant to the BSI Act (Verordnung zur Bestimmung Kritischer
Infrastrukturen nach dem BSI-Gesetz), it falls within the scope of the cross-sector review of the German foreign
investment screening regime under the German Foreign Trade and Payments Ordinance
(Außenwirtschaftsverordnung). As a result, non-EU/non-EFTA investors intending to acquire, directly or indirectly,
at least 10% of the voting rights in the Company or who already hold voting rights in the Company and will
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acquire further voting rights reaching or exceeding 20%, 25%, 40%, 50% or 75% of the voting rights in the
Company must notify the planned acquisition to the German Federal Ministry for Economic Affairs and Energy
(Bundesministerium für Wirtschaft und Energie, or the BMWE). The BMWE will then assess whether the
acquisition likely adversely affects the public order or security of Germany or other EU member states or projects
or programs of Union interest within the meaning of Article 8 of Regulation (EU) 2019/452 of the European
Parliament and of the Council of 19 March 2019 establishing a framework for the screening of foreign direct
investments into the Union. Clearance by the BMWE qualifies as a closing condition for all over-the-counter
transactions. If the acquisition has been made via the stock exchange, the acquirer is prohibited from exercising
its voting rights until the transaction has been cleared or is deemed cleared. If the BMWE identifies likely
adverse effects, the acquisition of voting rights in the Company could be restricted or prohibited or, if the
acquisition has been made via the stock exchange, the BMWE may order a sell-down of the voting rights in the
Company acquired via the stock exchange or a transfer to a trustee within a certain period of time and/or prohibit
the exercise of voting rights until such time as the acquisition is finally reversed.