10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________________________________________________________________

FORM 10-Q

______________________________________________________________________________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 001-38697

______________________________________________________________________________________

PhaseBio Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

Delaware	03-0375697
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1 Great Valley Parkway, Suite 30

Malvern, Pennsylvania 19355

(Address including zip code of principal executive offices)

(610) 981-6500

(Registrant’s telephone number, including area code)

______________________________________________________________________________________

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	PHAS	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

Class of Common Stock	Outstanding Shares as of August 9, 2021
Common Stock, $0.001 par value	48,042,483

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION	2
Item 1.	Condensed Financial Statements (Unaudited)	2
	Condensed Balance Sheets	2
	Condensed Statements of Operations	3
	Condensed Statements of Stockholders’ Equity (Deficit)	4
	Condensed Statements of Cash Flows	5
	Notes to Unaudited Condensed Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risks	37
Item 4.	Controls and Procedures	37
PART II.	OTHER INFORMATION	39
Item 1.	Legal Proceedings	39
Item 1A.	Risk Factors	39
Item 2.	Recent Sales of Unregistered Securities and Use of Proceeds	81
Item 3.	Defaults Upon Senior Securities	81
Item 4.	Mine Safety Disclosures	81
Item 5.	Other Information	81
Item 6.	Exhibits	81
	Signatures	84

1

PART 1. FINANCIAL INFORMATION

Item 1.    Condensed Financial Statements

PHASEBIO PHARMACEUTICALS, INC.

CONDENSED BALANCE SHEETS

(in thousands, except share and per share amounts)

(unaudited)

	June 30, 2021		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	64,456	$	28,122
Receivable from sublicense	18,400		—
Prepaid expenses and other assets	5,644		12,027
Total current assets	88,500		40,149
Property and equipment, net	10,379		8,224
Operating lease right-of-use assets	1,701		1,927
Other assets	57		57
Total assets	$	100,637	$	50,357
Liabilities and stockholders' deficit
Current liabilities:
Current portion of long-term debt	$	5,384	$	5,355
Current portion of deferred sublicense revenue	1,424		—
Accounts payable	2,958		3,674
Accrued expenses and other current liabilities	6,408		5,931
Total current liabilities	16,174		14,960
Long-term debt, net	4,073		6,773
Operating lease liabilities, net	1,306		1,548
Deferred sublicense revenue, net	8,238		—
Development derivative liability	89,329		51,719
Other long-term liabilities	692		559
Total liabilities	119,812		75,559
Commitments and contingencies (Note 9)
Stockholders’ deficit:
Preferred stock, $0.001 par value; 10,000,000 shares authorized; zero shares issued and        outstanding at June 30, 2021 and December 31, 2020	—		—
Common stock, $0.001 par value; 200,000,000 shares authorized; 48,057,720 shares issued and 48,027,753 shares outstanding at June 30, 2021; 29,471,854 shares issued and 29,441,887 shares outstanding at December 31, 2020	48		29
Treasury stock, at cost, 29,967 shares as of June 30, 2021 and December 31, 2020	(24)		(24)
Additional paid-in capital	297,561		235,516
Accumulated deficit	(316,760)		(260,723)
Total stockholders’ deficit	(19,175)		(25,202)
Total liabilities and stockholders' deficit	$	100,637	$	50,357

See accompanying notes to unaudited condensed financial statements.

2

PHASEBIO PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

(unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenue
Sublicense revenue	$	10,338	$	—	$	10,338	$	—
Grant revenue	—		—		—		320
Total revenue	10,338		—		10,338		320
Operating expenses:
Research and development	27,366		20,856		49,686		32,305
General and administrative	4,025		3,242		7,352		6,401
Total operating expenses	31,391		24,098		57,038		38,706
Loss from operations	(21,053)		(24,098)		(46,700)		(38,386)
Other income (expense):
Loss from remeasurement of development derivative liability	(5,777)		(3,708)		(7,203)		(4,162)
Interest income	5		21		7		232
Interest expense	(254)		(379)		(539)		(757)
Foreign exchange gain (loss)	—		22		(2)		26
Total other expense	(6,026)		(4,044)		(7,737)		(4,661)
Net loss before income taxes	(27,079)		(28,142)		(54,437)		(43,047)
Provision for income taxes	1,600		—		1,600		—
Net loss	$	(28,679)	$	(28,142)	$	(56,037)	$	(43,047)
Net loss per common share, basic and diluted	$	(0.60)	$	(0.98)	$	(1.41)	$	(1.50)
Weighted average common shares outstanding, basic and diluted	47,985,871		28,805,238		39,680,408		28,789,256

See accompanying notes to unaudited condensed financial statements.

3

PHASEBIO PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(in thousands, except share amounts)

(unaudited)

	Common Stock			Treasury Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' Equity (Deficit)
	Shares	Amount		Shares	Amount
Balance at December 31, 2020	29,471,854	$	29	(29,967)	$	(24)	$	235,516	$	(260,723)	$	(25,202)
Issuance of common stock in public offering, net	18,400,000	19		—	—		60,065		—		60,084
Exercises of stock options	110,146	—		—	—		217		—		217
Stock-based compensation	—	—		—	—		670		—		670
Net loss	—	—		—	—		—		(27,358)		(27,358)
Balance at March 31, 2021	47,982,000	48		(29,967)	(24)		296,468		(288,081)		8,411
Stock offering costs	—	—		—	—		157		—		157
Exercises of stock options	3,615	—		—	—		6		—		6
Issuance of common stock through employee share purchase plan	72,105	—		—	—		202		—		202
Stock-based compensation	—	—		—	—		728		—		728
Net loss	—	—		—	—		—		(28,679)		(28,679)
Balance at June 30, 2021	48,057,720	$	48	(29,967)	$	(24)	$	297,561	$	(316,760)	$	(19,175)
Balance at December 31, 2019	28,796,371	$	29	(29,967)	$	(24)	$	222,131	$	(162,158)	$	59,978
Issuance of common stock warrants	—	—		—	—		7,925		—		7,925
Exercise of stock options	14,236	—		—	—		17		—		17
Stock-based compensation	—	—		—	—		471		—		471
Net loss	—	—		—	—		—		(14,905)		(14,905)
Balance at March 31, 2020	28,810,607	29		(29,967)	(24)		230,544		(177,063)		53,486
Issuance of common stock in public offering, net	80,523	—		—	—		473		—		473
Exercises of stock options	404	—		—	—		1		—		1
Stock-based compensation	—	—		—	—		575		—		575
Net loss	—	—		—	—		—		(28,142)		(28,142)
Balance at June 30, 2020	28,891,534	$	29	(29,967)	$	(24)	$	231,593	$	(205,205)	$	26,393

See accompanying notes to unaudited condensed financial statements.

4

PHASEBIO PHARMACEUTICALS, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Six Months Ended June 30,
	2021		2020
Operating activities
Net loss	$	(56,037)	$	(43,047)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	1,057		111
Stock-based compensation	1,398		1,046
Loss from remeasurement of development derivative liability	7,203		4,162
Non-cash interest expense	173		261
Non-cash research and development expense	23,705		5,735
Other non-cash transactions	—		100
Changes in operating assets and liabilities:
Receivable from sublicense	(18,400)		—
Other receivables	—		1,233
Prepaid expenses and other assets	8,855		(7,107)
Accounts payable	(585)		4,302
Accrued expenses and other current liabilities	1,679		419
Deferred sublicense revenue	9,662		—
Net cash used in operating activities	(21,290)		(32,785)
Investing activities
Purchases of property and equipment	(385)		(1,079)
Acquisition of intellectual property rights	—		(100)
Net cash used in investing activities	(385)		(1,179)
Financing activities
Proceeds from development derivative liability	—		12,649
Proceeds from issuance of common stock in public offering, net	60,351		472
Payments of deferred stock offering costs	(40)		(175)
Proceeds from exercise of stock options	223		18
Issuance of common stock through employee share purchase plan	202		—
Repayments of long-term debt	(2,727)		—
Net cash provided by financing activities	58,009		12,964
Net increase (decrease) in cash and cash equivalents	36,334		(21,000)
Cash and cash equivalents at the beginning of the period	28,122		74,025
Cash and cash equivalents at the end of the period	$	64,456	$	53,025
Supplemental disclosure for cash flow
Cash paid for interest	$	366	$	496
Supplemental disclosure of non-cash investing and financing activities
Issuance of warrants in conjunction with development derivative liability	$	—	$	7,925
Initial recognition of operating lease right-of-use assets and operating lease liabilities	$	—	$	564
Purchases of property and equipment by incurring development derivative liability	$	4,160	$	—
Purchases of property and equipment included in accounts payable and accrued expenses	$	44	$	2,741

See accompanying notes to unaudited condensed financial statements.

5

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

1.    Organization and Description of Business

Description of Business

PhaseBio Pharmaceuticals, Inc. (the “Company”) was incorporated as a Delaware corporation on January 10, 2002. The Company is a clinical-stage biopharmaceutical company focused on the development and commercialization of novel therapies for cardiopulmonary diseases. The Company’s lead product candidate, bentracimab (also known as PB2452), is a novel reversal agent for the antiplatelet drug ticagrelor, which the Company is developing for the reversal of the antiplatelet effects of ticagrelor in patients with uncontrolled major or life-threatening bleeding or requiring urgent surgery or an invasive procedure. The Company’s second product candidate, pemziviptadil (also known as PB1046), is in Phase 2 development for the treatment of pulmonary arterial hypertension ("PAH"). Pemziviptadil utilizes the Company’s proprietary half-life extending elastin-like polypeptide technology, which also serves as an engine for the Company’s preclinical pipeline. The Company is also developing its preclinical product candidate, PB6440, for treatment-resistant hypertension.

Liquidity

The Company has experienced net losses and negative cash flows from operations and, as of June 30, 2021, had an accumulated deficit of $316.8 million. The Company expects to continue to incur net losses for at least the next several years. As of June 30, 2021, the Company had cash and cash equivalents of $64.5 million and working capital of $72.3 million. In January 2020, the Company entered into a co-development agreement ("SFJ Agreement") with SFJ Pharmaceuticals X, Ltd., an SFJ Pharmaceuticals Group company ("SFJ"), pursuant to which SFJ provides funding and operational support for the clinical development of bentracimab. Management believes that its existing cash and cash equivalents as of June 30, 2021, in addition to the $12.5 million in clinical trial costs and other expenses that the Company expects SFJ will fund or reimburse pursuant to the SFJ Agreement and the $20.0 million received from Alfasigma S.p.A. ("Alfasigma") in July 2021 pursuant to the Alfasigma Sublicense (as described below), will be sufficient to fund operating expenses and capital requirements through the fourth quarter of 2022.

In July 2021, the Company received a $20.0 million upfront payment upon entering into an exclusive sublicense agreement ("Alfasigma Sublicense") with Alfasigma for the commercialization of any product composed of or containing bentracimab (the "Licensed Products") in the European Union and European Economic Area, as well as the United Kingdom, Russia, Ukraine and certain other countries within the Commonwealth of Independent States, Europe and central Asia (the "Sublicense Territory").

The Company plans to address its future liquidity needs through the pursuit of additional funding through a combination of equity or debt financings, or other third-party financing, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements. However, there is no assurance that these funding efforts will be successful. The Company currently has an effective shelf registration statement on Form S-3 ("2019 Shelf Registration Statement") on file with the Securities and Exchange Commission ("SEC"), which expires in January 2023. The 2019 Shelf Registration Statement currently permits (i) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $200.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination and (ii) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $60.0 million of common stock that may be issued and sold under the "at-the-market" sales agreement with Citigroup Global Markets Inc. and William Blair & Company, L.L.C. (the "ATM Program"). As of June 30, 2021, the Company has sold 561,848 shares of common stock pursuant to the ATM Program for net proceeds of $2.9 million. During the six months ended June 30, 2021, the Company sold 18,400,000 shares of common stock in an underwritten offering pursuant to the 2019 Shelf Registration Statement for net proceeds of $60.2 million, after deducting underwriting discounts and commissions and other offering costs. As of June 30, 2021, the Company had $132.6 million of common stock remaining that can be sold under the 2019 Shelf Registration Statement, of which $57.0 million may be sold under the ATM Program.

The Company is continuing to assess the effect that the COVID-19 pandemic may have on its business and operations. The extent to which COVID-19 may impact the Company's business and operations will depend on future developments that are highly uncertain and cannot be predicted with confidence, such as the geographic distribution of the disease and its variants over time, the efficacy, availability and pace of administration of vaccines and antiviral agents against the disease,

6

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

the continued duration of the outbreak, the duration and effect of business disruptions and the short-term effects and ultimate effectiveness of the travel restrictions, quarantines, social distancing requirements and business closures in the United States and other countries to contain and treat the disease. While the potential economic impact brought by, and the continued duration of, the COVID-19 pandemic may be difficult to assess or predict, a continued and growing pandemic could result in significant disruption of global financial markets, reducing the Company's ability to access capital, which could in the future negatively affect its liquidity. In addition, a recession or market correction resulting from the spread of COVID-19 could materially affect the Company's business and the value of its common stock.

Basis of Presentation

The accompanying condensed financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) for interim financial reporting and the rules and regulations of the SEC. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations. All adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the accompanying condensed financial statements have been made. Although these interim condensed financial statements do not include all of the information and footnotes required for complete annual financial statements, management believes the disclosures are adequate to make the information presented not misleading. The unaudited interim results of operations and cash flows for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the full year. The unaudited interim condensed financial statements and footnotes should be read in conjunction with the audited financial statements and footnotes for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 15, 2021, wherein a more complete discussion of significant accounting policies and certain other information can be found.

Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”).

The Company manages its operations as a single reportable segment for the purposes of assessing performance and making operating decisions.

2.    Significant Accounting Policies

Use of Estimates

The preparation of the Company’s condensed financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s condensed financial statements and accompanying notes. The most significant estimates in the Company’s condensed financial statements relate to the valuation of the development derivative liability, the deferral and recognition of revenue under the Alfasigma Sublicense and the clinical trial accruals. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results could differ materially from those estimates and assumptions.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents. The Company maintains certain deposit accounts and money market funds in federally insured financial institutions in excess of federally insured limits. The Company could experience losses on the money market funds in the future.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity from the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents include cash in readily available checking and money market accounts.

7

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

Receivable from Sublicense

Receivable from sublicense relates to amounts due from Alfasigma under the Alfasigma Sublicense. The Company records amounts as accounts receivable when the right to consideration is deemed unconditional.

Fair Value of Financial Instruments

The carrying amounts of other receivables, prepaid expenses and other assets, accounts payable and accrued expenses and other current liabilities are reasonable estimates of their fair value because of the short maturity of these items. Based on the borrowing rates currently available to the Company for loans with similar terms, the Company believes the fair values of the term loan and operating lease liabilities and corresponding right-of-use assets approximate their respective carrying values.

Deferred Sublicense Revenue

When consideration is received, or such consideration is unconditionally due, from a customer prior to the Company completing its performance obligation to the customer under the terms of a contract, a contract liability is recorded as deferred revenue. Deferred revenues expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current liabilities. Deferred revenues not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as long-term liabilities.

Development Derivative Liability

Development derivative liability is recorded based on the present value of the estimated consideration to be received and the estimated consideration to be paid pursuant to contractual terms of the SFJ Agreement, which was determined to have been fair value. The liability is remeasured quarterly, as a Level 3 derivative, with any change in fair value recorded in the form of a gain (loss) from remeasurement of development derivative liability on the condensed statements of operations.

Property and Equipment

Property and equipment are recorded at cost and depreciated over the estimated useful lives of the assets (three to five years) using the straight-line method. Leasehold improvements are amortized over the shorter of their estimated useful lives or the lease term.

Leases

At lease commencement, the Company records a lease liability based on the present value of lease payments over the expected lease term including any options to extend the lease that the Company is reasonably certain to exercise. The Company calculates the present value of lease payments using an incremental borrowing rate as the Company’s leases do not provide an implicit interest rate. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. At the lease commencement date, the Company records a corresponding right-of-use lease asset based on the lease liability, adjusted for any lease incentives received and any initial direct costs paid to the lessor prior to the lease commencement date. The Company may enter into leases with an initial term of 12 months or less (“Short-Term Leases”). For any Short-Term Leases, the Company records the rent expense on a straight-line basis and does not record the leases on the condensed balance sheet. The Company had no Short-Term Leases as of June 30, 2021 or December 31, 2020.

After lease commencement, the Company measures its leases as follows: (i) the lease liability based on the present value of the remaining lease payments using the discount rate determined at lease commencement and (ii) the right-of-use lease asset based on the remeasured lease liability, adjusted for any unamortized lease incentives received, any unamortized initial direct costs and the cumulative difference between rent expense and amounts paid under the lease agreement. Any lease incentives received and any initial direct costs are amortized on a straight-line basis over the expected lease term. Rent expense is recorded on a straight-line basis over the expected lease term.

8

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

Long-Lived Assets

The Company regularly reviews the carrying value and estimated lives of all of its long-lived assets, including property and equipment and right-of-use assets to determine whether indicators of impairment may exist which warrant adjustments to carrying values or estimated useful lives. The determinants used for this evaluation include management’s estimate of the asset’s ability to generate net positive cash flow in future periods as well as the strategic significance of the assets to the Company’s business objectives. Should an impairment exist, the impairment loss would be measured based on the extent that the estimated fair value is less than its carrying value. The Company did not recognize any impairment losses in either the six months ended June 30, 2021 or the year ended December 31, 2020.

Preclinical and Clinical Trial Accruals

The Company accrues and expenses amounts incurred in connection with preclinical studies and clinical trial activities performed by third parties based upon estimates of the proportion of work completed over the life of the individual trial and subject enrollment rates in accordance with agreements with clinical research organizations, contract manufacturing organizations and clinical trial sites. The Company determines the estimates by reviewing contracts, vendor agreements and purchase orders, and through discussions with internal clinical personnel and external service providers as to the progress or stage of completion of trials or services and the agreed-upon fee to be paid for such services. However, actual costs and timing of clinical trials are highly uncertain, subject to risks and may change depending upon a number of factors, including the Company’s clinical development plan.

Management makes estimates of the Company’s accrued expenses as of each balance sheet date in the Company’s condensed financial statements based on facts and circumstances known to the Company at that time. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Nonrefundable advance payments for goods and services, including fees for process development or manufacturing and distribution of clinical supplies that will be used in future research and development activities, are deferred and recognized as expense in the period that the related goods are consumed or services are performed.

Revenue Recognition

Sublicense Revenue

Sublicensing arrangements may contain multiple components, which may include (i) sublicenses; (ii) research and development activities; and (iii) the manufacturing and supply of certain materials. Payments pursuant to these arrangements may include non-refundable payments, upfront payments, milestone payments upon the achievement of significant regulatory and development events or sales of product at certain agreed-upon amounts, sales milestones and royalties on product sales. The amount of variable consideration is constrained until it is probable that the revenue is not at a significant risk of reversal in a future period.

In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under a sublicense agreement, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are capable of being distinct; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue as the Company satisfies each performance obligation.

The Company must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation, which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as forecasted revenues and costs, development timelines, discount rates and probabilities of regulatory and commercial success. The Company also applies significant judgment when evaluating whether contractual obligations represent distinct performance obligations, allocating transaction price to performance obligations within a contract, determining when performance obligations have been met, assessing the recognition and future reversal of variable consideration and determining and applying appropriate methods of measuring progress for performance obligations satisfied over time.

9

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

Grant Revenue

Grant revenue is derived from government grants that support the Company’s efforts on specific research projects. The Company has determined that the government agencies providing grants to the Company are not customers. The Company recognizes grant revenue when there is reasonable assurance of compliance with the conditions of the grant and reasonable assurance that the grant revenue will be received.

Research and Development Expense

Research and development costs are expensed as incurred. Costs incurred in obtaining technology licenses are charged to research and development expense if the technology has no alternative future use.

Stock-Based Compensation

The Company measures and recognizes compensation expense for all stock-based compensation based on the estimated fair value at the date of grant. Currently, the Company’s stock-based awards consist only of stock options; however, future grants under the Company’s equity compensation plan may also consist of shares of restricted stock, restricted stock units, stock appreciation rights, performance awards and performance units. The Company also maintains the 2018 Employee Stock Purchase Plan ("ESPP") under which it may issue shares of common stock. The Company estimates the fair value of stock options and shares that will be issued under the ESPP using the Black-Scholes option-pricing model, which requires the use of estimates. The Company recognizes stock-based compensation cost for ratably vesting stock options and for shares that it will issue under the ESPP on a straight-line basis over the requisite service period of the award and records forfeitures in the period in which they occur.

The Black-Scholes option-pricing model requires the input of subjective assumptions, including the risk-free interest rate, the expected dividend yield of the Company’s common stock, the expected volatility of the price of the Company’s common stock, and the expected term of the option. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, the Company’s stock-based compensation expense could be materially different in the future. 

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the condensed financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the condensed financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If management determines that the Company would be able to realize its deferred tax assets in the future in excess of their net recorded amount, management would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

The Company records uncertain tax positions on the basis of a two-step process whereby (1) management determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, management recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits, if any, within income tax expense, and any accrued interest and penalties are included within the related tax liability line.

10

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

Net Loss Per Share

Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included when their effect is dilutive. The Company’s potentially dilutive securities, which include outstanding options under the Company's stock option plan, warrants issued from time to time and shares of common stock to be potentially issued under the ESPP, have been excluded from the computation of diluted net loss per share as they would be anti-dilutive. For all periods presented, there is no difference in the number of shares used to compute basic and diluted shares outstanding due to the Company’s net loss position.

The following table sets forth the outstanding, potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive:

	As of June 30,
	2021	2020
Common stock options	4,359,395	3,740,815
Warrants to purchase common stock	2,349,595	2,349,595
Employee stock purchase plan	275,077	271,012
Total	6,984,067	6,361,422

Recent Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which among other things, eliminates certain exceptions in the current rules regarding the approach for intraperiod tax allocations and the methodology for calculating income taxes in an interim period, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The standard became effective for the Company in the first quarter of 2021. Adoption of this new standard did not have a material impact on the Company's condensed financial statements and related disclosures.

3.    Fair Value Measurement

Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability.

The Company classifies fair value measurements in one of the following three categories for disclosure purposes:

Level 1:    Quoted prices in active markets for identical assets or liabilities.

Level 2:    Inputs other than Level 1 prices for similar assets or liabilities that are directly or indirectly observable in the marketplace.

Level 3:    Unobservable inputs that are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

The Company’s cash equivalents are classified using Level 1 inputs within the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. None of the Company’s non-financial assets or liabilities are recorded at fair value on a non-recurring basis. No transfers between levels have occurred during the periods presented.

The fair value of the Company's financial commitment to SFJ in conjunction with the SFJ Agreement is presented as a development derivative liability based on Level 3 inputs.

11

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

The following table summarizes the Company’s assets and liabilities that require fair value measurements on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):

	Total		Fair Value Measurements at Reporting Date
			Level 1		Level 2		Level 3
As of June 30, 2021:
Assets
Cash equivalents	$	64,236	$	64,236	$	—	$	—
Liabilities
Development derivative liability (Note 8)	$	89,329	$	—	$	—	$	89,329
As of December 31, 2020:
Assets
Cash equivalents	$	27,872	$	27,872	$	—	$	—
Liabilities
Development derivative liability (Note 8)	$	51,719	$	—	$	—	$	51,719

4.    Property and Equipment

The following table presents the composition of property and equipment, net as of June 30, 2021 and December 31, 2020 (in thousands):

	As of June 30, 2021		As of December 31, 2020
Lab equipment	$	12,244	$	8,994
Computer hardware, software and telephone	140		140
Furniture and fixtures	114		107
Leasehold improvements	77		67
Construction in progress	986		1,042
	13,561		10,350
Less accumulated depreciation	(3,182)		(2,126)
Property and equipment, net	$	10,379	$	8,224

Depreciation expense was $0.6 million and $0.1 million for the three months ended June 30, 2021 and 2020, respectively, and $1.1 million and $0.1 million for the six months ended June 30, 2021 and 2020, respectively.

5.    Accrued Expenses and Other Current Liabilities

The following table presents the composition of accrued expenses and other current liabilities as of June 30, 2021 and December 31, 2020 (in thousands):

12

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

	As of June 30, 2021		As of December 31, 2020
Accrued clinical and related costs	$	3,921	$	2,753
Accrued compensation and related costs	1,483		2,260
Accrued interest	52		69
Current portion of operating lease liability	476		459
Accrued other	476		390
Accrued expenses and other current liabilities	$	6,408	$	5,931

6.    Deferred Sublicense Revenue

In June 2021, the Company entered into the Alfasigma Sublicense with Alfasigma, under which the Company granted to Alfasigma exclusive rights to develop, use, sell, have sold, offer for sale and import the Licensed Products in the Sublicense Territory. Under the terms of the Alfasigma Sublicense, the Company received a $20.0 million upfront payment from Alfasigma in July 2021 and will be eligible to receive up to $35.0 million upon the achievement of certain pre-revenue regulatory milestones, up to $190.0 million upon the achievement of certain commercial milestones and tiered royalty payments based on net sales, with percentages starting in the low double digits and escalating up to the mid-twenties. Also, as part of the overall arrangement, the Company has agreed to supply the Licensed Products to Alfasigma at the lower of cost or a price not to exceed certain agreed amounts.

Under the Alfasigma Sublicense, the Company is responsible for developing the Licensed Products and securing regulatory approval with the European Medicines Agency (the “EMA”), and the Medicines and Healthcare products Regulatory Agency (the “MHRA”), including in accordance with the SFJ Agreement, after which any marketing authorizations will be assigned to Alfasigma. Alfasigma is obligated to obtain and maintain any regulatory approvals necessary to market and sell the Licensed Products (including pricing approvals and post-marketing commitments) and is also responsible for securing regulatory approval in the countries within the Sublicense Territory outside of the European Union and the United Kingdom.

The Company first assessed the Alfasigma Sublicense under ASC 808, Collaborative Arrangements (“ASC 808”) to determine whether the Alfasigma Sublicense or units of accounts within the Alfasigma Sublicense represent a collaborative arrangement based on the risks and rewards and activities of the parties. The Company concluded that Alfasigma represented a customer and applied relevant guidance from ASC 606, Revenue from Contracts with Customers (“ASC 606”) to evaluate the appropriate accounting under the Alfasigma Sublicense. In accordance with this guidance, the Company identified the following commitments under the arrangement: (i) exclusive sublicense rights to develop, use, sell, have sold, offer for sale and import Licensed Products (the “License”); (ii) development and regulatory activities (“Development and Regulatory Activities”); and (iii) the requirement to supply Alfasigma with the Licensed Product at the lower of cost or a price not to exceed certain agreed amounts (the “Supply of Licensed Product”). The Company determined that these three commitments represent distinct performance obligations for purposes of recognizing revenue and will recognize revenue as it fulfills these performance obligations.

The Company determined that the upfront payment of $20.0 million constitutes the transaction price as of the outset of the Alfasigma Sublicense. Future potential regulatory and development milestone payments were fully constrained as the risk of significant revenue reversal related to these amounts has not yet been resolved. The achievement of the future potential milestones is not within the Company’s control and is subject to certain research and development success or regulatory approvals and therefore carry significant uncertainty. The Company will reevaluate the likelihood of achieving these milestones at the end of each reporting period and adjust the transaction price in the period the risk is resolved. In addition, the Company will recognize any consideration related to sales-based milestones and royalties when the subsequent sales occur since those payments relate primarily to the License, which was delivered by the Company to Alfasigma upon entering into the Alfasigma Sublicense.

The transaction price was allocated to the three performance obligations based on the estimated stand-alone selling prices at contract inception. The stand-alone selling price of the License was based on a discounted cash flow approach and considered several factors including, but not limited to, discount rate, development timeline, regulatory risks, estimated market demand and future revenue potential using an adjusted market approach. The stand-alone selling price of the Development and Regulatory Activities and the Supply of Licensed Product was estimated using the expected cost-plus margin approach. The Company allocated the upfront portion of the transaction price to the performance obligations as of June 30, 2021 as follows (in thousands):

13

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

	Transaction Price		Cumulative Sublicense Revenue Recognized		Deferred Sublicense Revenue
License	$	10,223	$	10,223	$	—
Development and Regulatory Services	2,647		115		2,532
Supply of License Product	7,130		—		7,130
	$	20,000	$	10,338	9,662
Less current portion of long-term deferred sublicense revenue					(1,424)
Total long-term deferred sublicense revenue					$	8,238

The Company reevaluates the transaction price and the total estimated costs expected to be incurred to satisfy the performance obligations and adjusts the deferred sublicense revenue at the end of each reporting period. Such changes will result in a change to the amount of sublicense revenue recognized and deferred sublicense revenue.

7.    Debt

March 2019 Loan Agreement with Silicon Valley Bank and WestRiver Innovation Lending Fund VIII, L.P.

In March 2019, the Company entered into a loan (the "2019 Loan") with SVB and WestRiver Innovation Lending Fund VIII, L.P. (“WestRiver”), pursuant to which the Company could borrow up to $15.0 million, issuable in three separate tranches (“Advances”), of $7.5 million (“Tranche 1”), which was issued upon execution of the 2019 Loan, $2.5 million, which was issued in May 2019 (“Tranche 2”) and $5.0 million, which was issued in October 2019 (“Tranche 3”), which the Company was required to draw upon the achievement of certain regulatory milestones (the “Tranche 3 Milestones”).

The maturity date of the 2019 Loan is March 1, 2023. Under the terms of the 2019 Loan, the Company made interest-only payments through June 30, 2020 with respect to Tranche 1, Tranche 2 and Tranche 3 at a rate equal to the greater of the Prime Rate plus 1.00%, as defined in the 2019 Loan, or 6.5%, followed by an amortization period of 33 months of equal monthly payments of principal plus interest until paid in full. In addition to and not in substitution for the Company’s regular monthly payments of principal plus accrued interest, the Company is required to make a final payment equal to 6% of the aggregate principal amount of the advances (“Final Payment”) on the maturity date.

Upon execution of the 2019 Loan and the draw of Tranche 1, the Company issued to SVB and WestRiver warrants to purchase an aggregate of 37,606 shares of common stock with an exercise price of $4.73 per share. In May 2019, upon the draw of Tranche 2, the Company issued to SVB and WestRiver warrants to purchase an aggregate of 12,130 shares of common stock with an exercise price of $10.86 per share. In October 2019, upon the draw of Tranche 3, the Company issued to SVB and WestRiver warrants to purchase an aggregate of 24,262 shares of common stock with an exercise price of $3.88 per share. All warrants are immediately exercisable and expire ten years from the date of issuance.

Upon execution of the 2019 Loan, the Company drew $7.5 million from Tranche 1 and repaid the outstanding principal balance and the accrued portion of the Final Payment of the SVB Loan.

The Company’s obligations under the 2019 Loan are secured by a first-priority security interest in substantially all of the Company’s current and future assets. The Company is also obligated to comply with various other customary covenants, including restrictions on the Company’s ability to encumber its intellectual property assets. The Company was in compliance with all covenants under the 2019 Loan as of December 31, 2020.

The Company recorded a debt discount of $0.4 million for the estimated fair value of warrants and debt issuance costs upon the borrowings of Tranches 1, 2 and 3. The balance of the Final Payment liability was $0.7 million as of June 30, 2021 and is included in other long-term liabilities on the condensed balance sheet. The debt discount and Final Payment liability are being amortized to interest expense over the term of the 2019 Loan using the effective-interest method. Interest expense, including amortization of the debt discount related to the term debt and the Final Payment liability, totaled $0.3 million and $0.4 million for the three months ended June 30, 2021 and 2020, respectively, and $0.5 million and $0.8 million for the six months ended June 30, 2021 and 2020, respectively.

14

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

The following table sets forth by year the Company’s required future principal payments as of June 30, 2021 (in thousands):

Years Ending December 31,
2021 (remaining six months)	$	2,727
2022	5,455
2023	1,363
Thereafter	—
Total principal payments	9,545
Less unamortized loan fees	(88)
Total term loan borrowings	$	9,457

8.    Development Derivative Liability

In January 2020, the Company entered into the SFJ Agreement, pursuant to which SFJ has agreed to provide up to $120.0 million in funding and project management services in connection with the REVERSE-IT trial, a global Phase 3 clinical trial of bentracimab. During the term of the SFJ Agreement, the Company will have primary responsibility for clinical development and regulatory activities for bentracimab in the United States and the European Union, while SFJ will have primary responsibility for clinical development and regulatory activities for bentracimab in China and Japan and will provide clinical trials operational support in the European Union.

From the inception of the SFJ Agreement through June 30, 2021, SFJ has provided funding and paid for amounts on the Company's behalf in the aggregate amount of $77.5 million under the SFJ Agreement. In addition, the Company expects that SFJ will fund or reimburse an additional $12.5 million of clinical trial costs and other expenses. SFJ will also provide up to an additional $30.0 million upon the achievement of specified milestones with respect to the Company's clinical development of bentracimab.

If the United States Food and Drug Administration ("FDA") approves a Biologics License Application for bentracimab, the Company has agreed to pay to SFJ an initial payment of $5.0 million and an additional $325.0 million in the aggregate in seven additional annual payments (the “U.S. Approval Payments”). If the EMA or the national regulatory authorities in certain European countries provide marketing approval of bentracimab, the Company will pay SFJ an initial payment of $5.0 million and an additional $205.0 million in the aggregate in seven additional annual payments (the “EU Approval Payments”). The majority of the U.S. Approval Payments and the EU Approval Payments will be made from the third anniversary to the seventh anniversary of marketing approval in the applicable jurisdiction. If either the Pharmaceuticals and Medical Devices Agency (the “PMDA”) of Japan or the National Medical Products Administration (the “NMPA”) of China provides marketing approval of bentracimab, the Company will pay SFJ an initial payment of $1.0 million and then an additional $59.0 million in the aggregate in eight additional annual payments (the “Japan/China Approval Payments”), with the majority of the payments to be made from the fifth anniversary to the eighth anniversary of marketing approval. The Japan/China Approval Payments will only be paid once regardless of receipt of marketing approval in both Japan and China. The U.S. Approval Payments, EU Approval Payments and Japan/China Approval Payments will be proportionately adjusted in the event that the actual funding from SFJ is lower or greater than $120.0 million. The Company will not be obligated to make the U.S. Approval Payments if it does not receive marketing approval for bentracimab from the FDA, the EU Approval Payments if it does not receive marketing approval for bentracimab from the EMA or the national regulatory authority in certain European countries or the Japan/China Approval Payments if it does not receive marketing approval for bentracimab from either the PMDA or the NMPA.

Upon execution of the SFJ Agreement, the Company issued to SFJ a warrant to purchase an aggregate of 2,200,000 shares of common stock at an exercise price of $6.50 per share with a contractual term of ten years. The warrant is exercisable in two tranches: Tranche A and Tranche B. Tranche A represents 1,100,000 shares that are immediately exercisable by SFJ. Tranche B represents 1,100,000 shares that are exercisable at the earlier of (i) the achievement of certain development milestones or (ii) the consummation of an Acquisition, as defined in the SFJ Agreement. The warrants are equity-classified and were valued at $7.9 million at issuance using a probability adjusted Black-Scholes valuation technique.

The Company accounts for the SFJ Agreement as a derivative instrument that increases and decreases as consideration is received and repayments are made, respectively. The derivative is further adjusted at each reporting period to its estimated fair value. At June 30, 2021, the derivative is presented as a liability in the Company's condensed balance sheet. Any

15

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

changes in fair value are recorded within the Company's condensed statements of operations. The liability was initially recorded at a value of $2.1 million, which incorporates the $10.0 million upfront payment from SFJ and the issuance of the Company's common stock warrants to SFJ. During the six months ended June 30, 2021, SFJ provided additional funding and paid for amounts on the Company's behalf in the aggregate amount of $30.4 million, and the development derivative liability was subsequently remeasured at June 30, 2021, as a Level 3 derivative. The change in fair value was $5.8 million and $3.7 million for the three months ended June 30, 2021 and 2020, respectively, and $7.2 million and $4.2 million for the six months ended June 30, 2021 and 2020, respectively.

The development derivative liability is valued using a scenario-based discounted cash flow method, whereby each scenario makes assumptions about the probability and timing of cash flows, and such cash flows are present valued using a risk-adjusted discount rate. The valuation method incorporates certain unobservable Level 3 key inputs including (i) the probability and timing of funding, (ii) the probability and timing of achieving regulatory approvals, (iii) the Company's cost of borrowing (16.00% plus the risk free borrowing rate) and (iv) SFJ's cost of borrowing (2.50% plus the risk free borrowing rate).

The following table presents activity for the development derivative liability during the six months ended June 30, 2021 (in thousands):

	Development Derivative Liability
Balance at December 31, 2020	$	51,719
Funding during the period	30,407
Change in fair value	7,203
Balance at June 30, 2021	$	89,329

9.    Commitments and Contingencies

Legal Proceedings

The Company is not currently a party to any litigation, nor is management aware of any pending or threatened litigation against the Company, that it believes would materially affect the Company’s business, operating results, financial condition or cash flows.

10.    Leases

The Company leases office and research and development facilities and equipment under various non-cancellable operating lease agreements.

In January 2010, the Company entered into a lease for office and laboratory space in Malvern, Pennsylvania (the “Malvern Lease”). The Malvern Lease commenced in March 2010 and was amended to extend its term to July 2018 and again to September 2023, with an option to extend the lease for an additional three years. This lease contains escalating rent payments. In December 2018, the Company entered into a lease for office space in San Diego, California, which expires in October 2022. In June 2020, the Company entered into a lease for additional office space in Malvern, Pennsylvania, which expires in September 2023. As of June 30, 2021, the weighted average remaining lease term for the Company’s leases was 4.2 years, and the weighted average discount rate used to determine the right-of-use assets and corresponding operating lease liabilities was 5.8%.

16

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

Maturities of operating lease liabilities as of June 30, 2021 are as follows (in thousands):

Year Ending December 31,
2021 (remaining six months)	$	283
2022	555
2023	419
2024	279
2025	283
Thereafter	215
Total future minimum lease payments	2,034
Less: Present value adjustment	(252)
Operating lease liabilities	$	1,782

The Company recognizes rent expense for the operating leases on a straight-line basis. Rent expense was $0.2 million and $0.1 million for the three months ended June 30, 2021 and 2020, respectively, and $0.4 million and $0.2 million for the six months ended June 30, 2021 and 2020, respectively.

11.    Stockholders’ Equity

Shelf Registration Statement

In December 2019, the Company filed the 2019 Shelf Registration Statement on Form S-3, which became effective in January 2020. The 2019 Shelf Registration Statement, which expires in January 2023, permits: (i) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $200.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination; and (ii) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $60.0 million of the Company's common stock that may be issued and sold in "at-the-market" sales under the ATM Program. As of June 30, 2021, the Company has $132.6 million of common stock remaining that can be sold under the 2019 Shelf Registration Statement, of which $57.0 million may be sold under the ATM Program.

Shares Sold Under the ATM Program

As of June 30, 2021, the Company has sold 561,848 shares of common stock pursuant to the ATM Program for gross proceeds of $2.9 million.

March 2021 Offering

In March 2021, pursuant to the 2019 Shelf Registration Statement, the Company completed an underwritten public offering of its common stock, which resulted in the issuance and sale of an aggregate of 18,400,000 shares of common stock at a public offering price of $3.50 per share, generating net proceeds of $60.2 million, after deducting underwriting discounts and commissions and other offering costs.

12.    Stock-Based Compensation

Stock-based compensation expense has been reported in the Company’s condensed statements of operations for the three and six months ended June 30, 2021 and 2020 as follows (in thousands):

17

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
General and administrative	$	510	$	402	$	984	$	742
Research and development	219		173		414		304
Total stock-based compensation	$	729	$	575	$	1,398	$	1,046

As of June 30, 2021, the total unrecognized compensation expense related to unvested employee and non-employee stock options was $5.6 million, which is expected to be recognized over a weighted-average period of approximately 2.5 years.

In October 2018, the Company's board of directors and stockholders approved the ESPP, which became effective on October 17, 2018. The ESPP is intended to qualify as an "employee stock purchase plan" within the meaning of Section 423 of the Internal Revenue Code.

Under the ESPP, eligible employees are granted rights to purchase shares of common stock, which are funded through payroll deductions that cannot exceed 15% of each employee’s compensation. The ESPP generally provides for a 24-month offering period, which includes four six-month purchase periods. At the end of each purchase period, eligible employees are permitted to purchase shares of common stock at 85% of the lower of fair market value at the beginning of the offering period or fair market value at the end of the purchase period. The ESPP is considered a compensatory plan, and the Company recorded stock-based compensation expense of $0.1 million and $21,000 for the three months ended June 30, 2021 and 2020, respectively, and $0.1 million and $21,000 for the six months ended June 30, 2021 and 2020, respectively. The Company issued 72,105 and zero shares of common stock under the ESPP for the six months ended June 30, 2021 and 2020, respectively.

As of June 30, 2021, the total unrecognized compensation expense related to the ESPP was $0.2 million, which is expected to be recognized over a weighted-average period of approximately 0.8 years.

13.    License and Other Agreements

MedImmune Limited License Agreement

In November 2017, the Company entered into a license agreement (“MedImmune License”) with MedImmune Limited (“MedImmune”). MedImmune is a wholly-owned subsidiary of AstraZeneca plc (“AstraZeneca”). Pursuant to the terms of the MedImmune License, MedImmune granted the Company exclusive global rights for the purpose of developing and commercializing products under the MedImmune License (“MedImmune licensed product”). The Company has made contingent milestone payments of $3.0 million and is obligated to make remaining contingent milestone payments totaling up to an aggregate of $15.0 million upon the achievement of clinical development and regulatory milestones. In addition, the Company will pay MedImmune tiered royalties ranging from mid-single-digit to low-teen percentages of net sales of any MedImmune licensed products and additional payments of up to $50.0 million in aggregate commercial milestones. The Company incurred no royalty costs under the MedImmune License in the three and six months ended June 30, 2021 and 2020.

The Company also must pay quarterly fees relating to technical services provided by MedImmune. The MedImmune License requires the Company to cooperate with MedImmune on commercial messaging of bentracimab and provides MedImmune with the return of rights to bentracimab if certain commercial diligence requirements are not achieved by the Company. In addition, the MedImmune License offers an option for third-party product storage costs. The Company incurred no third-party product storage costs in the three and six months ended June 30, 2021 and 2020. AstraZeneca is a stockholder of the Company.

Duke License Agreement

In October 2006, the Company entered into a license agreement with Duke University (“Duke”) (as amended, the “Duke License”). Pursuant to the Duke License, Duke granted to the Company an exclusive, worldwide license under certain patent rights and a non-exclusive license to know-how owned or controlled by Duke to develop and commercialize any products or processes covered under the Duke License (the “Duke licensed products”). The Duke License was amended in February 2016 to allow Duke to use the Company’s technology in the area of small-molecule oncologics. The Duke License is a worldwide, sublicensable agreement and remains in full effect for the life of the last-to-expire patents included in the patent rights, which is estimated to be 2030. The Company is required to apply for, prosecute and maintain all United States and foreign patent rights under the Duke License.

18

PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

The Company is obligated to pay up to $2.2 million upon the achievement of clinical development and regulatory milestones and up to $0.4 million upon the achievement of commercial milestones. The Duke License may be terminated by Duke if the Company fails to meet certain clinical development and regulatory milestones within specified timeframes. As of June 30, 2021, the Company was in compliance with its development obligations.

The Company is required to use commercially reasonable efforts to develop one or more products or processes and introduce them into commercial markets. Duke will receive low single-digit royalty percentages on net sales of Duke licensed products by the Company or its sublicensee, with minimum aggregate royalties of $0.2 million payable following the Company’s achievement of certain commercial milestones. No sales of Duke licensed products or services have occurred since the effective date through June 30, 2021.

Certain alliance fee payments up to the greater of $0.3 million or a low double-digit percentage of the fees the Company receives from a third party in consideration of forming a strategic alliance may be required depending upon how the patent rights are commercialized. The Company must pay Duke the first $1.0 million of non-royalty payments it receives from a sublicensee, and thereafter a specified percentage of any additional non-royalty payments it receives, subject to certain conditions. If Duke receives revenue as a result of a license or sublicense to a third party in the field of small-molecule oncologics, it will pay the Company a specified percentage of the amount of such revenue in excess of $1.0 million. The Company incurred no costs under the Duke License in the three and six months ended June 30, 2021 and 2020.

Alfasigma Sublicense

In June 2021, the Company entered into the Alfasigma Sublicense with Alfasigma under which the Company granted to Alfasigma exclusive rights to develop, use, sell, have sold, offer for sale and import the Licensed Products in the Sublicense Territory. Under the terms of the Alfasigma Sublicense, in July 2021, the Company received a $20.0 million upfront payment from Alfasigma and will be eligible to receive up to $35.0 million upon the achievement of certain pre-revenue regulatory milestones, up to $190.0 million upon the achievement of certain commercial milestones and tiered royalty payments on net sales, with percentages starting in the low double digits and escalating up to the mid-twenties.

With respect to the up to $35.0 million of regulatory milestone payments: (i) $10.0 million is payable following acceptance by the EMA of the filing of the first drug approval application for a Licensed Product; (ii) $12.5 million is payable following achievement of conditional regulatory approval from the EMA; and (iii) the remaining $12.5 million is payable following achievement of unconditional regulatory approval from the EMA allowing for prescribing of a Licensed Product for the reversal of the antiplatelet effects of ticagrelor in both (a) patients with uncontrolled major or life-threatening bleeding and (b) patients requiring urgent surgery or an invasive procedure.

Under the Alfasigma Sublicense, the Company is responsible for developing the Licensed Products and securing regulatory approval with the EMA and the MHRA, including in accordance with the SFJ Agreement, after which any marketing authorizations will be assigned to Alfasigma. Alfasigma is obligated to obtain and maintain any regulatory approvals necessary to market and sell the Licensed Products (including pricing approvals and post-marketing commitments) and is also responsible for securing regulatory approval in countries outside of Europe and the United Kingdom. Alfasigma will purchase its requirements from the Company for a set period, after which the Company is obligated to supply a lesser amount of Alfasigma's requirements, for Licensed Product at the lower of cost or a price not to exceed certain agreed amounts.

Unless earlier terminated, the Alfasigma Sublicense automatically expires, with respect to each Licensed Product and each country in the Sublicense Territory, on the latest of (1) the tenth anniversary of the first commercial sale of such Licensed Product in such country, (2) the expiration of the last out-licensed patent of such Licensed Product in such country and (3) the expiration of regulatory exclusivity, if any, of such Licensed Product in such country.

In connection with the Alfasigma Sublicense, the Company and Alfasigma also entered into an Acknowledgement of Grant of Sublicense with MedImmune (the “Acknowledgement of Grant”), which provides for, among other things, (i) a potential assignment of the Alfasigma Sublicense from the Company to MedImmune or (ii) a potential assignment of the Medimmune License from the Company to Alfasigma, in either case in the event that the Company breaches certain obligations under the Medimmune License that are not cured or remedied and SFJ has grounds to execute a “Program Transfer” (as defined in the SFJ Agreement) but elects not to do so.

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PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

Wacker License Agreement

In April 2019, the Company entered into a license agreement (“Wacker License Agreement”), with Wacker Biotech GmbH (“Wacker”), pursuant to which Wacker granted the Company an exclusive license under certain of Wacker’s intellectual property rights to use Wacker’s proprietary E. coli strain for the manufacture of bentracimab worldwide outside of specified Asian countries, and to commercialize bentracimab, if approved, manufactured by the Company or on the Company’s behalf using Wacker’s proprietary E. coli strain throughout the world. The Company has the right to grant sublicenses under the license, subject to certain conditions as specified in the Wacker License Agreement. Under the terms of the agreement, the Company is required to pay a fixed, nominal per-unit royalty, which is subject to adjustment, and an annual license fee in a fixed Euro amount in the low to mid six digits. The agreement will be in force for an indefinite period of time, and upon the expiration of the Company’s royalty obligations, the license will be considered fully paid and will convert to a non-exclusive license. Either party may terminate the Wacker License Agreement for breach if such breach is not cured within a specified number of days. The Company incurred $0.1 million and $0.1 million under the Wacker License Agreement for the three months ended June 30, 2021 and 2020, respectively, and $0.2 million and $0.2 million for the six months ended June 30, 2021 and 2020, respectively.

Viamet Asset Purchase Agreement

In January 2020, the Company entered into a purchase agreement ("PB6440 Agreement") with Viamet Pharmaceuticals Holdings, LLC and its wholly-owned subsidiary, Selenity Therapeutics (Bermuda), Ltd. (the "Sellers"), pursuant to which the Company acquired all of the assets and intellectual property rights related to the Sellers’ proprietary CYP11B2 inhibitor compound, formerly known as SE-6440 or VT-6440, and certain other CYP11B2 inhibitor compounds that are covered by the patent rights acquired by the Company under the PB6440 Agreement (together, "Compounds"). Under the terms of the PB6440 Agreement, the Company paid the Sellers an upfront fee of $0.1 million upon the closing of the transaction, and are required to pay the Sellers up to $5.1 million upon the achievement of certain development and intellectual property milestones with respect to certain product candidates that contain a Compound, up to $142.5 million upon the achievement of certain commercial milestones with respect to any approved product that contains a Compound and low- to mid-single digit royalty percentages on the net sales of approved products that contain a Compound, subject to customary reductions and offsets in specified circumstances. The Company incurred zero in costs under the PB6440 Agreement for the three months ended June 30, 2021 and 2020, and zero and $0.1 million for the six months ended June 30, 2021 and 2020, respectively.

BioVectra Supply Agreement

In March 2021, the Company entered into a supply agreement, ("BioVectra Agreement"), with BioVectra Inc. ("BioVectra") for the manufacture and supply by BioVectra of bulk drug substance for bentracimab for commercial distribution following regulatory approval, if obtained. Under the terms of the BioVectra Agreement, BioVectra has committed to maintaining capacity to manufacture an agreed number of batches of product each year, and the Company has committed to purchase a specified minimum number of batches of product per year (the "Minimum Annual Commitment"), although it is free to contract with third parties for the manufacture of bentracimab. The Company will pay a supply price per batch of bentracimab to be determined after the manufacturing process for the bentracimab is validated in accordance with the BioVectra Agreement, plus the cost of certain consumables, raw materials, and third-party testing.

Pursuant to the Minimum Annual Commitments, the Company is obligated to purchase a minimum of (i) approximately $14.0 million of batches of bentracimab in years 2022 through 2023, (ii) approximately $37.0 million of batches of bentracimab in 2024, and (iii) approximately $48.0 million of batches of bentracimab in each of years 2025 through 2031. In the event the Company does not purchase the applicable Minimum Annual Commitment in a given year, it will be obligated to make a payment to BioVectra in an amount equal to the then-applicable supply price per batch multiplied by the difference between the Minimum Annual Commitment for such year and the number of batches of product it actually purchased in such year, except in the event that BioVectra was unable to deliver the number of batches ordered by the Company in such year. The Company will have the right to reduce the Minimum Annual Commitments for the year 2026 and subsequent years by up to a specified maximum percentage per year. Further, if the Company is only able to obtain regulatory approval for products incorporating bentracimab in only one of the United States or Europe, BioVectra and the Company have agreed to discuss in good faith an amendment to the BioVectra Agreement to reflect decreased requirements for product and impacts to the supply price to reflect lower volume commitments.

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PhaseBio Pharmaceuticals, Inc.

Notes to Condensed Financial Statements

(unaudited)

14.    Revenue

Sublicense revenue

Sublicense revenue relates to the revenue that the Company recognized in relation to the Alfasigma Sublicense. The Company recognized sublicense revenue of $10.3 million and zero in the three months ended June 30, 2021 and 2020 and $10.3 million and zero for the six months ended June 30, 2021 and 2020, respectively.

Grant revenue

In February 2018, the Company received Small Business Innovation Research (“SBIR”) grants from the National Institutes of Health in an aggregate amount of $2.8 million to support the clinical development of pemziviptadil for the treatment of pulmonary arterial hypertension for the period from February 17, 2018 to July 31, 2020. In connection with the SBIR grants, the United States government will receive a non-exclusive, royalty-free license to use any technology the Company develops under such grants. As of March 31, 2020, the Company had received all $2.8 million in funding available under the SBIR grant. The Company recognized zero revenue under the SBIR grants in the three months ended June 30, 2021 and 2020, and zero and $0.3 million for the six months ended June 30, 2021 and 2020, respectively.

15.    Related Party Transactions

As described above in Note 13, the Company is party to the MedImmune License. AstraZeneca, the parent company of MedImmune, is a related party of the Company.

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Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed financial statements and related notes included in this Quarterly Report on Form 10-Q and our audited financial statements and notes thereto as of and for the periods ended December 31, 2020 and 2019 and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K filed with the SEC on March 15, 2021. Unless the context requires otherwise, references in this Quarterly Report on Form 10-Q to “we,” “us,” and “our” refer to PhaseBio Pharmaceuticals, Inc.

Forward-Looking Statements

The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which are subject to the “safe harbor” created by those sections. These forward-looking statements include, but are not limited to, statements concerning our strategy, future operations, future financial position, future revenues, projected costs, prospects and plans and objectives of management. The words “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that we make. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those in the forward-looking statements, including, without limitation, the risks set forth in Part II, Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q and in our other filings with the SEC. Such risks and uncertainties may be amplified by the COVID-19 pandemic and its potential impact on our business and the global economy. The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements, except as required by law.

Overview

We are a clinical-stage biopharmaceutical company focused on the development and commercialization of novel therapies for cardiopulmonary diseases. Our lead product candidate, bentracimab (also known as PB2452), is a novel reversal agent for the antiplatelet drug ticagrelor, which we are developing for the reversal of the antiplatelet effects of ticagrelor in patients with uncontrolled major or life-threatening bleeding or requiring urgent surgery or an invasive procedure. Based on feedback from the United States Food and Drug Administration, or FDA, we intend to seek approval of bentracimab in the United States through an accelerated approval process. In our completed Phase 2a clinical trial of bentracimab, we observed immediate and complete reversal of ticagrelor’s antiplatelet activity within five minutes following initiation of infusion and sustained reversal for over 20 hours. Our second product candidate, pemziviptadil (also known as PB1046), is a once-weekly fusion protein currently in a Phase 2b clinical trial for the treatment of pulmonary arterial hypertension, or PAH. Pemziviptadil utilizes our proprietary half-life extending elastin-like polypeptide, or ELP, technology, which also serves as an engine for our preclinical pipeline. We are also developing our preclinical product candidate, PB6440, for treatment-resistant hypertension. Except for the rights that we granted to Alfasigma S.p.A., or Alfasigma, for bentracimab, we retain worldwide commercial rights to all of our product candidates.

As we advance our clinical programs for bentracimab and pemziviptadil with site activations and patient enrollment, we remain in close contact with our clinical research organizations, clinical sites and suppliers to attempt to assess the impacts that COVID-19 and its variants may have on our clinical trials and current timelines and to consider whether we can implement appropriate mitigating measures to help lessen such impacts. At this time, however, we cannot fully forecast the scope of impacts that COVID-19 may have on our ability to initiate trial sites, enroll and assess patients, supply study drug and report trial results.

We are developing bentracimab pursuant to a co-development agreement, or the SFJ Agreement, with SFJ Pharmaceuticals X, Ltd., an SFJ Pharmaceuticals Group company, or SFJ. Under the SFJ Agreement, SFJ has agreed to pay us up to $120.0 million to support the clinical development of bentracimab. During the term of the SFJ Agreement, we will have primary responsibility for clinical development and regulatory activities for bentracimab in the United States and the European Union, while SFJ will have primary responsibility for clinical development and regulatory activities for bentracimab in China and Japan and will provide clinical trials operations support in the European Union.

We recently entered into a sublicense agreement with Alfasigma, or the Alfasigma Sublicense, pursuant to which we granted Alfasigma exclusive rights to distribute and sell bentracimab in the European Union and European Economic Area, as well as the United Kingdom, Russia, Ukraine and certain other countries within the Commonwealth of Independent States, Europe and central Asia, or the Sublicense Territory. Under the Alfasigma Sublicense, we are responsible for developing bentracimab and securing regulatory approval with the European Medicines Agency, or the EMA, and the Medicines and Healthcare products Regulatory Agency, or MHRA, including in accordance with the SFJ Agreement, after which any marketing

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authorizations will be assigned to Alfasigma. Alfasigma is obligated to obtain and maintain any regulatory approvals necessary to market and sell bentracimab (including pricing approvals and post-marketing commitments) and is also responsible for securing regulatory approval in countries outside of Europe and the United Kingdom.

In March 2020, we commenced our pivotal REVERSE-IT trial, a global, multi-center, non-randomized, open-label trial in which we plan to enroll a total of 200 ticagrelor patients with uncontrolled major or life-threatening bleeding or requiring urgent surgery or an invasive procedure. The primary endpoints for this trial are the reversal of the antiplatelet effects of ticagrelor with intravenous infusion of bentracimab as measured by the VerifyNow® PRUTest® biomarker and achievement of hemostasis in enrolled patients. We are currently enrolling patients in the United States, the European Union and Canada in this trial. In addition, our Investigational New Drug, or IND, application for bentracimab was recently approved by the Center for Drug Evaluation, or CDE, of the China National Medical Products Administration, or NMPA.

The FDA granted Breakthrough Therapy designation for bentracimab in April 2019, and the EMA granted bentracimab Priority Medicines, or PRIME, designation in February 2020. The FDA previously provided feedback that we could submit a Biologics License Application, or BLA, for potential accelerated approval based on an interim analysis of the first approximately 100 patients treated in our REVERSE-IT trial. For the interim analysis, the FDA also recommended that approximately 50 patients enrolled have uncontrolled major or life-threatening bleeding and approximately 50 require urgent surgery or an invasive procedure, although the FDA indicated that whether there are an adequate number of patients in either group would be a review issue.

We intend to complete the REVERSE-IT trial and establish a post-approval registry in accordance with FDA requirements. With regard to the 200 total patients needed for full enrollment of the REVERSE-IT trial, our protocol provides that no more than approximately two-thirds of patients can come from either the uncontrolled major or life-threatening bleeding population or the patient population requiring urgent surgery or an invasive procedure. The Committee for Medicinal Products for Human Use, or CHMP of the EMA, has also generally agreed with our proposed clinical development plan for bentracimab.

As of August 9, 2021, we have enrolled 143 patients in the REVERSE-IT trial. Because the total number of patients enrolled to date included 138 patients who required urgent surgery or an invasive procedure, this cohort of the trial has been fully enrolled, and trial sites have shifted focus to enrolling patients with uncontrolled major or life-threatening bleeding events. We intend to submit our BLA for potential accelerated approval based on an interim analysis of these first 143 patients, all of whom have been measured against the same VerifyNow PRUTest biomarker and hemostasis endpoints described above. For our interim analysis, we elected to continue to enroll ticagrelor patients in excess of our prior target of approximately 100 patients to take advantage of robust surgical enrollment and to mitigate continued uncertainties caused by the COVID-19 pandemic and its potential impact on future patient availability. We are targeting to release top-line results from the interim analysis later in 2021 and to submit our BLA in mid-2022, although that timeline could be impacted by the continued scope and duration of the COVID-19 pandemic.

We intend to continue to enroll patients in the REVERSE-IT trial and will primarily target patients with uncontrolled major or life-threatening bleeding. We are continuing to attempt to accelerate enrollment of these patients, including by working to increase the number of enrolling clinical trial sites in the United States, Canada, and the European Union as we believe that a broader site footprint will increase the probability of enrolling these patients. We are also expecting to begin enrolling patients in China for the REVERSE-IT trial later in 2021.

Following the submission of our BLA, the FDA could determine that we did not enroll a sufficient number of patients in the REVERSE-IT trial, including patients with uncontrolled major or life-threatening bleeding, for all or some of the proposed indications we intend to pursue. Further, the FDA may require us to conduct extensive post-approval studies or require us to make modifications to our ongoing REVERSE-IT trial after approval and marketing.

We have completed enrollment for our Phase 2b bentracimab trial, which is a multi-center, randomized, double-blind, placebo-controlled trial that is designed to evaluate the safety and efficacy of bentracimab in reversing the antiplatelet effects of ticagrelor in healthy adults who are older and elderly (ages 50 to 80) as part of a dual antiplatelet regimen including low-dose aspirin. We expect to report top-line results for this trial later in 2021.

With respect to our pemziviptadil program, we are currently dosing patients in a randomized, double-blinded, controlled Phase 2b clinical trial in which we plan to enroll approximately 60 PAH patients to assess the safety, tolerability and efficacy of pemziviptadil. We currently expect to report the top-line results of this trial by mid-2022.

We plan to initiate IND -enabling activities for PB6440 in 2021, which are expected to be followed by an IND submission in 2022, although those timelines could be impacted by the scope and duration of the COVID-19 pandemic.

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Since our inception in 2002, our operations have focused on developing our clinical and preclinical product candidates and our proprietary ELP technology, organizing and staffing our company, business planning, raising capital, establishing our intellectual property portfolio and conducting clinical trials and preclinical studies. We do not have any product candidates approved for sale and have not generated any revenue from product sales. Since inception, we have financed our operations primarily through the sale of equity and debt securities, our term loans with Silicon Valley Bank, or SVB, and WestRiver Innovation Lending Fund VIII, L.P., or WestRiver, funds we have received under the SFJ Agreement and funds we have received pursuant to the Alfasigma Sublicense.

In January 2020, we entered into the SFJ Agreement pursuant to which SFJ has agreed to provide us up to $120.0 million of funding to support the clinical development of bentracimab. As of June 30, 2021, SFJ has provided funding and paid for amounts on our behalf in the aggregate amount of $77.5 million under the SFJ Agreement. In addition, we expect that SFJ will fund or reimburse an additional $12.5 million of clinical trial costs and other expenses. SFJ will also provide up to an additional $30.0 million of funding upon the achievement of specified clinical development milestones with respect to our ongoing REVERSE-IT trial of bentracimab.

In March 2021, we received $60.2 million in net proceeds from an underwritten public offering of our common stock. In addition, in June 2021, we entered into the Alfasigma Sublicense with Alfasigma. Under the terms of the Alfasigma Sublicense, we received a $20.0 million upfront payment from Alfasigma in July 2021 and will be eligible to receive up to $35.0 million upon the achievement of certain pre-revenue regulatory milestones, up to $190.0 million upon the achievement of certain commercial milestones and tiered royalty payments on net sales, with percentages starting in the low double digits and escalating up to the mid-twenties.

Since our inception, we have incurred significant operating losses. Our net loss was $56.0 million for the six months ended June 30, 2021. As of June 30, 2021, we had an accumulated deficit of $316.8 million. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that our expenses will increase substantially in connection with our ongoing activities, as we:

•continue our ongoing clinical trials of bentracimab and pemziviptadil, as well as initiate and complete additional clinical trials, as needed;

•seek to expand our geographical reach through the SFJ Agreement and the Alfasigma Sublicense and the corresponding clinical development support fees and milestone payments that we will incur or receive;

•pursue regulatory approvals for bentracimab as a reversal agent for the antiplatelet drug ticagrelor and pemziviptadil for the treatment of PAH;

•develop PB6440 for treatment-resistant hypertension;

•seek to discover and develop additional clinical and preclinical product candidates;

•scale up our clinical and regulatory capabilities;

•establish a commercialization infrastructure and scale up external manufacturing and distribution capabilities to commercialize any product candidates for which we may obtain regulatory approval, including bentracimab and pemziviptadil;

•adapt our regulatory compliance efforts to incorporate requirements applicable to marketed products;

•maintain, expand and protect our intellectual property portfolio;

•hire additional clinical, manufacturing and scientific personnel;

•add operational, financial and management information systems and personnel, including personnel to support our product development and possible future commercialization efforts; and

•incur additional legal, accounting and other expenses in operating as a public company.

FINANCIAL OVERVIEW

Components of Operating Results

Revenue

    Sublicense Revenue

Sublicense revenue relates to the revenue we recognized in relation to the Alfasigma Sublicense, which contains multiple components including (i) sublicenses; (ii) research and development activities; and (iii) the manufacturing and supply of

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certain materials. Payments pursuant to this arrangement include a non-refundable, upfront payment, milestone payments upon the achievement of significant regulatory and development events, sales of product at certain agreed-upon amounts, sales milestones and royalties on product sales. The amount of variable consideration is constrained until it is probable that the revenue is not at a significant risk of reversal in a future period.

In determining the appropriate amount of revenue to be recognized as we fulfill our obligations under the sublicense agreement, we perform the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are capable of being distinct; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations and (v) recognition of revenue as we satisfy each performance obligation.

Grant Revenue

Grant revenue is derived from government grants that support our efforts on specific research projects. We recognize grant revenue when there is reasonable assurance of compliance with the conditions of the grant and reasonable assurance that the grant revenue will be received.

Research and Development Expense

Research and development expense consists of expenses incurred in connection with the discovery and development of our product candidates. We expense research and development costs as incurred. These expenses include:

•expenses incurred under agreements with contract research organizations, or CROs, as well as investigative sites and consultants that conduct our clinical trials and preclinical studies;

•manufacturing and supply scale-up expenses and the cost of acquiring and manufacturing preclinical and clinical trial supply and potential commercial supply, including manufacturing validation batches;

•clinical development support fees that we incur related to the SFJ Agreement;

•outsourced professional scientific development services;

•employee-related expenses, which include salaries, benefits and stock-based compensation;

•licensing costs payable to third parties for use of their intellectual property;

•expenses relating to regulatory activities; and

•facilities, laboratory materials and supplies used to support our research activities.

Research and development activities are central to our business model. Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. We expect our research and development expense to increase significantly over the next several years as we increase personnel costs, including stock-based compensation, conduct our later-stage clinical trials for bentracimab and pemziviptadil, develop PB6440, conduct other preclinical studies and clinical trials, prepare regulatory filings and, if we receive regulatory approval for one or more product candidates, prepare for commercialization efforts.

The successful development of our product candidates is highly uncertain. At this time, we cannot reasonably estimate or know the nature, timing and costs of the efforts that will be necessary to complete the remainder of the development of our product candidates, or when, if ever, material net cash inflows may commence from those candidates. This uncertainty is due to the numerous risks and uncertainties associated with the duration and cost of clinical trials, which vary significantly over the life of a project as a result of many factors, including:

•delays in regulators or institutional review boards authorizing us or our investigators to commence our clinical trials or in our ability to negotiate agreements with clinical trial sites or contract research organizations;

•our ability to secure adequate supply of our product candidates for our trials;

•the number of clinical sites included in the trials;

•the length of time required to enroll suitable patients;

•the number of patients that ultimately participate in the trials;

•the number of doses that patients receive;

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•any side effects associated with our product candidates;

•the impacts of the COVID-19 pandemic on our ability to initiate trial sites, enroll and assess patients, supply study drug and report trial results;

•the duration of patient follow-up; and

•the results of our clinical trials.

Our expenditures are subject to additional uncertainties, including the terms and timing of regulatory approvals, and the expense of filing, prosecuting, defending and enforcing any patent claims or other intellectual property rights. We may never succeed in achieving regulatory approval for our product candidates. We may obtain unexpected results from our clinical trials. We may elect to discontinue, delay or modify clinical trials of our product candidates. A change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate. For example, if the FDA or other regulatory authorities were to require us to conduct clinical trials beyond those that we currently anticipate, or if we experience significant delays in enrollment in any of our clinical trials, we could be required to expend significant additional financial resources and time on the completion of clinical development. Product commercialization will take several years and millions of dollars in development costs.

General and Administrative Expense

General and administrative expense consists principally of salaries and related costs for personnel in executive and administrative functions, including stock-based compensation, travel expenses and recruiting expenses. Other general and administrative expense includes professional fees for legal, accounting and tax-related services and insurance costs.

We expect that general and administrative expenses will increase over the next several years to support our continued research and development activities of our product candidates, manufacturing activities, potential commercialization of bentracimab and the increased costs operating as a public company. We believe that these increases likely will include increased costs for director and officer liability insurance, costs related to the hiring of additional personnel and increased fees for outside consultants, lawyers and accountants. We also expect to incur increased costs to comply with corporate governance, internal controls, investor relations, disclosure and similar requirements applicable to public reporting companies.

Loss From Remeasurement of Development Derivative Liability

Loss from remeasurement of development derivative liability reflects the revaluation at each reporting date of our development derivative liability based on the present value of the estimated consideration to be received and the estimated consideration to be paid pursuant to the contractual terms under the SFJ Agreement, which is determined to be fair value. The liability is remeasured at the end of each quarter as a Level 3 derivative, with the change in fair value recorded in the condensed statements of operations.

Interest Expense

Interest expense consists of interest expense on our term loan with SVB and WestRiver.

Income Tax Expense

Income tax expense consists of international withholding tax on the initial payment from Alfasigma.

License, Co-Development and Other Agreements

MedImmune Limited License Agreement

In November 2017, we entered into an exclusive license agreement, or the MedImmune License, with MedImmune Limited, or MedImmune, a wholly owned subsidiary of AstraZeneca plc. Pursuant to the MedImmune License, MedImmune granted us an exclusive, worldwide license under certain patent rights owned or controlled by MedImmune to develop and commercialize any products covered by the MedImmune License, or the MedImmune Licensed Products, for the treatment, palliation, diagnosis or prevention of any human disorder or condition. Under the MedImmune License, we paid MedImmune an upfront fee of $0.1 million. We are also required to pay MedImmune: quarterly fees relating to technical services provided by MedImmune; up to $18.0 million in clinical and regulatory milestone fees, $3.0 million of which had been incurred as of June 30, 2021; up to $50.0 million in commercial milestone fees; and mid-single digit to low-teen royalty percentages on net sales of

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MedImmune Licensed Products, subject to reduction in specified circumstances. In addition, the MedImmune License offers an option for third-party product storage costs. From the inception of the MedImmune License through June 30, 2021, we have incurred costs of $3.6 million under the MedImmune License.

Co-Development Agreement with SFJ Pharmaceuticals

In January 2020, we entered into the SFJ Agreement, pursuant to which SFJ provides us funding to support the global development of bentracimab as a reversal agent for the antiplatelet drug ticagrelor in patients with uncontrolled major or life-threatening bleeding or requiring urgent surgery or an invasive procedure. In March 2020, we obtained the consent of Silicon Valley Bank, or SVB, to grant SFJ a security interest in all of the assets owned or controlled by us that are necessary for the manufacture, use or sale of bentracimab. Under the SFJ Agreement, SFJ has agreed to pay us up to $120.0 million to support the clinical development of bentracimab. From the inception of the SFJ Agreement through June 30, 2021, SFJ has provided funding and paid for amounts on our behalf in the aggregate amount of $77.5 million. In addition, we expect that SFJ will fund or reimburse an additional $12.5 million of clinical trial costs and other expenses pursuant to the SFJ Agreement. SFJ will also provide up to an additional $30.0 million of funding upon the achievement of specified milestones with respect to our clinical development of bentracimab. During the term of the SFJ Agreement, we will have primary responsibility for clinical development and regulatory activities for bentracimab in the United States and the European Union, while SFJ will have primary responsibility for clinical development and regulatory activities for bentracimab in China and Japan and will provide clinical trials operational support in the European Union.

Under the terms of the SFJ Agreement, following the FDA approval of a BLA for bentracimab, we will pay SFJ an initial payment of $5.0 million and an additional $325.0 million in the aggregate in seven additional annual payments. If the EMA or the national regulatory authority in certain European countries approve the equivalent of a BLA, known as a Marketing Authorization Application, or MAA, for bentracimab, we will pay SFJ an initial payment of $5.0 million and an additional $205.0 million in the aggregate in seven additional annual payments. If either the PMDA of Japan or the NMPA of China approves a marketing application for bentracimab, we will pay SFJ an initial payment of $1.0 million and then an additional $59.0 million in the aggregate in eight additional annual payments.

Within 120 days following approval of a BLA or MAA for bentracimab in one of the jurisdictions described above, we have the right, at our option, to make a one-time cash payment to SFJ to buy out all or a portion of the future unpaid approval payments for such jurisdiction (i.e., the U.S. Approval Payments, EU Approval Payments or Japan/China Approval Payments, as applicable) for a price reflecting a mid-single-digit discount rate. Within 120 days following a change of control of our company, we or our successor have the right, at its option, to make a one-time cash payment to SFJ to buy out all or a portion of the future unpaid approval payments in any of the jurisdictions in which a BLA or MAA for bentracimab was approved prior to the change of control for a price reflecting a mid-single-digit discount rate, provided that SFJ has not previously assigned the right to receive such payments to a third party (in which event we or our successor shall not have such right).

If following termination of the SFJ Agreement we continue to develop bentracimab and obtain BLA or MAA approval in the United States, the European Union, Japan or China, we will make the applicable approval payments for such jurisdiction to SFJ as if the SFJ Agreement had not been terminated, less any payments made upon termination, except that if we terminate the SFJ Agreement for SFJ’s failure to make any payment to us when due, or SFJ terminates the SFJ Agreement due to a material adverse event, as defined in the SFJ Agreement, then our obligation to make such approval payments would be reduced by 50%.

Duke License Agreement

In October 2006, we entered into an exclusive license agreement with Duke University, or Duke, which was most recently amended in April 2019, or the Duke License. Pursuant to the Duke License, Duke granted us an exclusive, worldwide license under certain patent rights owned or controlled by Duke, and a non-exclusive, worldwide license under certain know-how of Duke, to develop and commercialize any products covered by the Duke License, or Duke licensed products, relating to ELPs. Under the Duke License, we paid Duke an upfront fee of $37,000, additional fees in connection with amendments to the Duke License of $0.2 million and other additional licensing fees of $0.2 million. In consideration for license rights granted to us, we initially issued Duke 24,493 shares of our common stock. Until we reached a certain stipulated equity milestone, which we reached in October 2007, we were obligated to issue additional shares of common stock to Duke from time to time so that its aggregate ownership represented 7.5% of our issued and outstanding capital stock. We are also required to pay Duke: up to $2.2 million in regulatory and clinical milestone fees; up to $0.4 million in commercial milestone fees; low single-digit royalty percentages on net sales of Duke licensed products, with minimum aggregate royalty payments of $0.2 million payable following our achievement of certain commercial milestones; and up to the greater of $0.3 million or a low double-digit percentage of the fees we receive from a third party in consideration of forming a strategic alliance with respect to certain patent rights covered

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under the Duke License. We also must pay Duke the first $1.0 million of non-royalty payments we receive from a sublicensee, and thereafter a low double-digit percentage of any additional non-royalty payments we receive, subject to certain conditions. From the inception of the Duke License through June 30, 2021, we have incurred royalty costs of $0.3 million under the Duke License. We are also required to apply for, prosecute and maintain all U.S. and foreign patent rights under the Duke License.

Alfasigma Sublicense Agreement

In June 2021, we entered into the Alfasigma Sublicense, with Alfasigma, under which we granted to Alfasigma exclusive rights to develop, use, sell, have sold, offer for sale and import any product composed of or containing bentracimab, or Licensed Products, in the Sublicense Territory. Under the terms of the Alfasigma Sublicense, in July 2021, we received a $20.0 million upfront payment from Alfasigma and will be eligible to receive up to $35.0 million upon the achievement of certain pre-revenue regulatory milestones, up to $190.0 million upon the achievement of certain commercial milestones and tiered royalty payments on net sales, with percentages starting in the low double digits and escalating up to the mid-twenties.

With respect to the up to $35.0 million of regulatory milestone payments: (i) $10.0 million is payable following acceptance by the EMA of the filing of the first drug approval application for a Licensed Product; (ii) $12.5 million is payable following achievement of conditional regulatory approval from the EMA; and (iii) the remaining $12.5 million is payable following achievement of unconditional regulatory approval from the EMA allowing for prescribing of a Licensed Product for the reversal of the antiplatelet effects of ticagrelor in both (a) patients with uncontrolled major or life-threatening bleeding and (b) patients requiring urgent surgery or an invasive procedure.

Under the Alfasigma Sublicense, we are responsible for developing the Licensed Products and securing regulatory approval with the EMA and the MHRA, including in accordance with the SFJ Agreement, after which any marketing authorizations will be assigned to Alfasigma. Alfasigma is obligated to obtain and maintain any regulatory approvals necessary to market and sell the Licensed Products (including pricing approvals and post-marketing commitments) and is also responsible for securing regulatory approval in countries outside of Europe and the United Kingdom. We have also agreed to provide Licensed Products to Alfasigma at the lower of cost or a price not to exceed certain agreed amounts.

Wacker License Agreement

In April 2019, we entered into a license agreement, or the Wacker License Agreement, with Wacker Biotech GmbH, or Wacker, pursuant to which Wacker granted us an exclusive license under certain of Wacker’s intellectual property rights to use Wacker’s proprietary E. coli strain for the manufacture of bentracimab worldwide outside of specified Asian countries and to commercialize bentracimab, if approved, manufactured by us or on our behalf using Wacker’s proprietary E. coli strain throughout the world. We have the right to grant sublicenses under the license, subject to certain conditions as specified in the Wacker License Agreement. Under the terms of the agreement, we are required to pay a fixed, nominal per-unit royalty, which is subject to adjustment, and an annual license fee in a fixed Euro amount in the low to mid six digits. The agreement will be in force for an indefinite period of time, and upon the expiration of our royalty obligations, the license will be considered fully paid and will convert to a non-exclusive license. Either party may terminate the Wacker License Agreement for breach if such breach is not cured within a specified number of days. From the inception of the Wacker License Agreement through June 30, 2021, we have incurred $0.6 million in costs under the Wacker License Agreement.

Viamet Asset Purchase Agreement

In January 2020, we entered into a purchase agreement, or the PB6440 Agreement, with Viamet Pharmaceuticals Holdings, LLC and its wholly-owned subsidiary, Selenity Therapeutics (Bermuda), Ltd., or the Sellers, pursuant to which we acquired all of the assets and intellectual property rights related to the Sellers’ proprietary CYP11B2 inhibitor compound, formerly known as SE-6440 or VT-6440, and certain other CYP11B2 inhibitor compounds that are covered by the patent rights acquired by us under the PB6440 Agreement, or together, Compounds. Under the terms of the PB6440 Agreement, we paid the Sellers an upfront fee of $0.1 million upon the closing of the transaction, and we are required to pay the Sellers up to $5.1 million upon the achievement of certain development and intellectual property milestones with respect to certain product candidates that contain a Compound, up to $142.5 million upon the achievement of certain commercial milestones with respect to any approved product that contains a Compound and low- to mid-single digit royalty percentages on the net sales of approved products that contain a Compound, subject to customary reductions and offsets in specified circumstances. From the inception of the PB6440 Agreement through June 30, 2021, we have incurred $0.1 million in costs under the PB6440 Agreement.

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BioVectra Supply Agreement

In March 2021, we entered into a supply agreement, or the BioVectra Agreement, with BioVectra Inc., or BioVectra, for the manufacture and supply by BioVectra of bulk drug substance for bentracimab for commercial distribution following regulatory approval, if obtained. Under the terms of the BioVectra Agreement, BioVectra has committed to maintaining capacity to manufacture an agreed number of batches of product each year, and we have committed to purchase a specified minimum number of batches of product per year, or the Minimum Annual Commitment, although we are free to contract with third parties for the manufacture of bentracimab. We will pay a supply price per batch of bentracimab to be determined after the manufacturing process for the bentracimab is validated in accordance with the BioVectra Agreement, plus the cost of certain consumables, raw materials, and third-party testing.

Pursuant to the Minimum Annual Commitments, we are obligated to purchase a minimum of (i) approximately $14.0 million of batches of bentracimab in years 2022 through 2023, (ii) approximately $37.0 million of batches of bentracimab in 2024, and (iii) approximately $48.0 million of batches of bentracimab in each of years 2025 through 2031. In the event we do not purchase the applicable Minimum Annual Commitment in a given year, we will be obligated to make a payment to BioVectra in an amount equal to the then-applicable supply price per batch multiplied by the difference between the Minimum Annual Commitment for such year and the number of batches of bentracimab we actually purchased in such year, except in the event that BioVectra was unable to deliver the number of batches ordered by us in such year. We will have the right to reduce the Minimum Annual Commitments for the year 2026 and subsequent years by up to a specified maximum percentage per year. Further, if we are only able to obtain regulatory approval for products incorporating bentracimab in only one of the U.S. or Europe, BioVectra and we have agreed to discuss in good faith an amendment to the BioVectra Agreement to reflect decreased requirements for bentracimab and impacts to the supply price to reflect lower volume commitments.

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Results of Operations

Comparison of the Three Months Ended June 30, 2021 and 2020

The following table summarizes our results of operations for the three months ended June 30, 2021 and 2020 (in thousands):

	Three Months Ended June 30,				Change
	2021		2020
Revenue
Sublicense revenue	$	10,338	$	—	$	10,338
Total revenue	10,338		—		10,338
Operating expenses:
Research and development	27,366		20,856		6,510
General and administrative	4,025		3,242		783
Total operating expenses	31,391		24,098		7,293
Loss from operations	(21,053)		(24,098)		3,045
Other income (expense):
Loss from remeasurement of development derivative liability	(5,777)		(3,708)		(2,069)
Interest income	5		21		(16)
Interest expense	(254)		(379)		125
Foreign exchange gain	—		22		(22)
Total other expense	(6,026)		(4,044)		(1,982)
Net loss before income taxes	(27,079)		(28,142)		1,063
Provision for income taxes	1,600		—		1,600
Net loss	$	(28,679)	$	(28,142)	$	(537)

Sublicense Revenue

Sublicense revenue was $10.3 million for the three months ended June 30, 2021, compared to zero for the three months ended June 30, 2020. The increase was attributable to the revenue we recognized from the initial payment pursuant to the Alfasigma Sublicense.

Research and Development Expense

Research and development expense was $27.4 million for the three months ended June 30, 2021, compared to $20.9 million for the three months ended June 30, 2020. The increase of $6.5 million was primarily attributable to increased drug manufacturing and clinical development activities related to bentracimab and costs associated with our general research and development efforts, partially offset by lower costs related to pemziviptadil.

The following table summarizes our research and development expenses by functional area for the three months ended June 30, 2021 and 2020 (in thousands):

	Three Months Ended June 30,				Change
	2021		2020
Preclinical and clinical development	$	24,079	$	18,523	$	5,556
Compensation and related benefits	1,843		1,790		53
Stock-based compensation	219		173		46
Facilities expense	399		180		219
Other	826		190		636
Total research and development expenses	$	27,366	$	20,856	$	6,510

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We track our external research and development expenses on a program-by-program basis. However, we do not track our internal research and development expenses on a program-by-program basis as they primarily relate to compensation, early research and consumable costs, which are deployed across multiple projects under development. The following table summarizes our research and development expenses by product candidate for the three months ended June 30, 2021 and 2020 (in thousands):

	Three Months Ended June 30,				Change
	2021		2020
External research and development expense by program:
Bentracimab	$	21,564	$	13,036	$	8,528
Pemziviptadil	2,218		5,220		(3,002)
Unallocated research and development expense:
Compensation and stock-based compensation	2,062		1,963		99
Other research and development	1,522		637		885
Total research and development expenses	$	27,366	$	20,856	$	6,510

General and Administrative Expense

General and administrative expense was $4.0 million for the three months ended June 30, 2021, compared to $3.2 million for the three months ended June 30, 2020. The increase of $0.8 million was primarily attributable to increases in consulting costs and personnel expenses due to additional headcount.

Loss From Remeasurement of Development Derivative Liability

Loss from remeasurement of development derivative liability was $5.8 million for the three months ended June 30, 2021, compared to $3.7 million for the three months ended June 30, 2020. This liability was initially recorded at the present value of the estimated consideration to be received and the estimated consideration to be paid pursuant to the contractual terms of the SFJ Agreement, which was determined to have been fair value. The liability is remeasured at the end of each quarter as a Level 3 derivative.

Interest Income

Interest income was $5,000 for the three months ended June 30, 2021, compared to $21,000 for the three months ended June 30, 2020.

Interest Expense

Interest expense was $0.3 million for the three months ended June 30, 2021, compared to $0.4 million for the three months ended June 30, 2020. The decrease of $0.1 million was attributable to lower outstanding borrowings on the 2019 Loan during the three months ended June 30, 2021.

Income Tax Expense

Income tax expense was $1.6 million for the three months ended June 30, 2021, compared to zero for the three months ended June 30, 2020. The increase was attributable to international withholding tax on the initial payment from Alfasigma.

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Comparison of the Six Months Ended June 30, 2021 and 2020

The following table summarizes our results of operations for the six months ended June 30, 2021 and 2020 (in thousands):

	Six Months Ended June 30,				Change
	2021		2020
Revenue
Sublicense revenue	$	10,338	$	—	$	10,338
Grant revenue	—		320		(320)
Total revenue	10,338		320		10,018
Operating expenses:
Research and development	49,686		32,305		17,381
General and administrative	7,352		6,401		951
Total operating expenses	57,038		38,706		18,332
Loss from operations	(46,700)		(38,386)		(8,314)
Other income (expense):
Loss from remeasurement of development derivative liability	(7,203)		(4,162)		(3,041)
Interest income	7		232		(225)
Interest expense	(539)		(757)		218
Foreign exchange gain (loss)	(2)		26		(28)
Total other expense	(7,737)		(4,661)		(3,076)
Net loss before income taxes	(54,437)		(43,047)		(11,390)
Provision for income taxes	1,600		—		1,600
Net loss	$	(56,037)	$	(43,047)	$	(12,990)

Sublicense Revenue

Sublicense revenue was $10.3 million for the six months ended June 30, 2021, compared to zero for the six months ended June 30, 2020. The increase was attributable to the revenue we recognized from the initial payment pursuant to the Alfasigma Sublicense.

Grant Revenue

Grant revenue was zero for the six months ended June 30, 2021, compared to $0.3 million for the six months ended June 30, 2020. As of March 31, 2020, we had received all $2.8 million in funding available under the Small Business Innovation Research grants we received from the National Institutes of Health to support the clinical development of pemziviptadil for the treatment of PAH.

Research and Development Expense

Research and development expense was $49.7 million for the six months ended June 30, 2021, compared to $32.3 million for the six months ended June 30, 2020. The increase of $17.4 million was primarily attributable to increased costs associated with drug manufacturing and clinical development activities related to bentracimab, general research activities, and increased personnel costs due to additional headcount, partially offset by lower costs related to pemziviptadil .

The following table summarizes our research and development expenses by functional area for the six months ended June 30, 2021 and 2020 (in thousands):

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	Six Months Ended June 30,				Change
	2021		2020
Preclinical and clinical development	$	43,370	$	27,701	$	15,669
Compensation and related benefits	3,660		3,377		283
Stock-based compensation	414		304		110
Facilities expense	767		445		322
Other	1,475		478		997
Total research and development expenses	$	49,686	$	32,305	$	17,381

We track our external research and development expenses on a program-by-program basis. However, we do not track our internal research and development expenses on a program-by-program basis as they primarily relate to compensation, early research and consumable costs, which are deployed across multiple projects under development. The following table summarizes our research and development expenses by product candidate for the six months ended June 30, 2021 and 2020 (in thousands):

	Six Months Ended June 30,				Change
	2021		2020
External research and development expense by program:
Bentracimab	$	38,401	$	19,904	$	18,497
Pemziviptadil	4,419		6,946		(2,527)
Unallocated research and development expense:
Compensation and stock-based compensation	4,074		3,681		393
Other research and development	2,792		1,774		1,018
Total research and development expenses	$	49,686	$	32,305	$	17,381

General and Administrative Expense

General and administrative expense was $7.4 million for the six months ended June 30, 2021, compared to $6.4 million for the six months ended June 30, 2020. The increase of $1.0 million was primarily attributable to increases in consulting costs, personnel expense due to additional headcount and insurance costs.

Loss From Remeasurement of Development Derivative Liability

Loss from remeasurement of derivative liability was $7.2 million for the six months ended June 30, 2021, compared to $4.2 million for the six months ended June 30, 2020. This liability was initially recorded at the present value of the estimated consideration to be received and the estimated consideration to be paid pursuant to the contractual terms of the SFJ Agreement, which was determined to have been fair value. The derivative liability was subsequently remeasured at the end of each quarter as a Level 3 derivative.

Interest Income

Interest income was $7,000 for the six months ended June 30, 2021, compared to $0.2 million for the six months ended June 30, 2020. The decrease of $0.2 million was attributable to lower balances of cash and cash equivalents and lower interest rates during 2021.

Interest Expense

Interest expense was $0.5 million for the six months ended June 30, 2021, compared to $0.8 million for the six months ended June 30, 2020. The decrease of $0.3 million was attributable to lower outstanding borrowings on the 2019 Loan during the six months ended June 30, 2021

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Income Tax Expense

Income tax expense was $1.6 million for the six months ended June 30, 2021, compared to zero for the six months ended June 30, 2020. The increase was attributable to international withholding tax on the initial payment from Alfasigma.

Liquidity and Capital Resources

Since our inception, we have not generated any revenue from product sales and have incurred net losses and negative cash flows from our operations. We have financed our operations primarily through public offerings of our common stock, private placements of convertible debt and convertible preferred stock, borrowings under our term loans and funds we have received under the SFJ Agreement and funds we have received pursuant to the Alfasigma Sublicense. In future periods we expect SFJ to provide up to an additional $42.5 million of funding pursuant to the SFJ Agreement, $30.0 million of which we are eligible to receive upon the achievement of specified milestones with respect to our clinical development of bentracimab. As of June 30, 2021, we had cash and cash equivalents of $64.5 million.

In December 2019, we filed a shelf registration statement on Form S-3, or the 2019 Shelf Registration Statement, which became effective in January 2020. The 2019 Shelf Registration Statement permits: (i) the offering, issuance and sale by us of up to a maximum aggregate offering price of $200.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination; and (ii) the offering, issuance and sale by us of up to a maximum aggregate offering price of $60.0 million of our common stock that may be issued and sold under an “at-the-market” sales agreement, or ATM Program, with Citigroup Global Markets Inc. and William Blair & Company, L.L.C. As of June 30, 2021, we have raised net proceeds of $2.9 million pursuant to the ATM Program from the sale of 561,848 shares of our common stock at a weighted-average price of $5.41 per share.

In January 2020, we entered into the SFJ Agreement, pursuant to which SFJ agreed to provide funding to support the development of bentracimab as a reversal agent for the antiplatelet drug ticagrelor. Under the SFJ Agreement, SFJ has agreed to pay us up to $120.0 million to support the clinical development of bentracimab. From the inception of the SFJ Agreement through June 30, 2021, SFJ has provided funding and paid for amounts on our behalf in the aggregate amount of $77.5 million. In addition, we expect that SFJ will fund or reimburse an additional $12.5 million of clinical trial costs and other expenses. We are also eligible to receive up to an additional $30.0 million of funding upon the achievement of specific clinical development milestones with respect to our ongoing REVERSE-IT trial of bentracimab.

In March 2021, pursuant to the 2019 Shelf Registration Statement, we completed an underwritten public offering of our common stock, which resulted in the issuance and sale of an aggregate of 18,400,000 shares of common stock at a public offering price of $3.50 per share, generating net proceeds of $60.2 million, after deducting underwriting discounts and commissions and other offering costs. We have $132.6 million of common stock remaining that can be sold under the 2019 Shelf Registration Statement, of which $57.0 million may be sold under the ATM Program.

In July 2021, pursuant to the Alfasigma Sublicense, we received an upfront payment of $20.0 million from Alfasigma. We are eligible to receive up to $35.0 million upon the achievement of certain pre-revenue regulatory milestones, up to $190.0 million upon the achievement of certain commercial milestones and tiered royalty payments on net sales, with percentages starting in the low double digits and escalating up to the mid-twenties.

The following table summarizes our cash flows for each of the periods set forth below (in thousands):

	Six Months Ended June 30,
	2021		2020
Net cash used in operating activities	$	(21,290)	$	(32,785)
Net cash used in investing activities	(385)		(1,179)
Net cash provided by financing activities	58,009		12,964
Net increase (decrease) in cash and cash equivalents	$	36,334	$	(21,000)

Operating Activities

Net cash used in operating activities was $21.3 million during the six months ended June 30, 2021. The use of cash primarily related to our net loss of $56.0 million, partially offset by non-cash expenses and a $1.2 million change in our operating assets and liabilities. The non-cash expenses consisted primarily of $23.7 million in research and development expenses paid for on our behalf by SFJ, $7.2 million from the loss from remeasurement of development derivative liability, $1.4 million in stock-based compensation and $1.1 million in depreciation and amortization. The change in our operating assets and liabilities was principally due to an increase in our deferred sublicense revenue of $9.7 million, a decrease of $8.9 million in prepaid expenses

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and other assets and an increase of $1.7 million in accrued expenses and other current liabilities primarily due to the timing of payments related to clinical trial activities for bentracimab and pemziviptadil, partially offset by an increase in the sublicense receivable of $18.4 million, and a decrease of $0.6 million in accounts payable.

Net cash used in operating activities was $32.8 million during the six months ended June 30, 2020. The use of cash primarily related to our net loss of $43.0 million, in addition to a $1.2 million change in our operating assets and liabilities. The use of cash was partially offset by non-cash expenses, primarily $5.7 million in research and development expenses paid on our behalf by SFJ, a $4.2 million loss from remeasurement of development derivative liability and $1.0 million in stock-based compensation. The change in our operating assets and liabilities was principally due to a $7.1 million increase in prepaid expenses as a result of drug manufacturing payments related to bentracimab, partially offset by a $4.3 million increase in accounts payable in the first half of 2020. 

Investing Activities

Net cash used in investing activities was $0.4 million for the purchase of property and equipment during the six months ended June 30, 2021. Net cash used in investing activities was $1.2 million for the purchase of property and equipment and the acquisition of intellectual property rights during the six months ended June 30, 2020.

Financing Activities

Net cash provided by financing activities was $58.0 million during the six months ended June 30, 2021, due primarily to the receipt of $60.4 million in net proceeds from the March 2021 underwritten public offering, $0.2 million in proceeds from the exercise of stock options and $0.2 million in proceeds from shares purchased through the employee share purchase program, partially offset by $2.7 million in repayments of long-term debt. Net cash provided by financing activities was $13.0 million during the six months ended June 30, 2020, due primarily to the receipt of $12.6 million under the SFJ Agreement and $0.5 million in net proceeds from sales under the ATM Program, partially offset by $0.2 million in payments of stock offering costs.

Funding Requirements

To date, we have not generated any revenues from the commercial sale of approved drug products, and we do not expect to generate substantial revenue for at least the next several years. If we fail to complete the development of our product candidates in a timely manner or fail to obtain their regulatory approval, our ability to generate future revenue will be compromised. We cannot guarantee when, or if, we will generate any revenue from our product candidates, and we do not expect to generate significant revenue unless and until we obtain regulatory approval of, and commercialize, our product candidates. We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the research and development of, continue or initiate clinical trials of, and seek marketing approval for, our product candidates. In addition, if we obtain approval for any of our product candidates, we expect to incur significant commercialization expenses related to sales, marketing, manufacturing and distribution. We anticipate that we will need substantial additional funding in connection with our continuing operations. If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or eliminate our research and development programs or future commercialization efforts. We plan to address our future liquidity needs through the pursuit of additional funding through a combination of equity or debt financings, or other third-party financing, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements. However, there is no assurance that these funding efforts will be successful.

We expect that our existing cash and cash equivalents as of June 30, 2021, in addition to the $20.0 million that we received from Alfasigma in July 2021 pursuant to the Alfasigma Sublicense and the $12.5 million of clinical trial costs and other expenses that we expect SFJ will fund or reimburse, will be sufficient to fund our operating expenses and capital requirements through the fourth quarter of 2022. We intend to devote our existing cash and cash equivalents to advance our clinical and preclinical development programs. We have based our estimates on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Because of the numerous risks and uncertainties associated with the development and commercialization of product candidates, we are unable to estimate the amounts of increased capital outlays and operating expenditures necessary to complete the development and potential commercialization of product candidates.

Our future capital requirements will depend on many factors, including:

•the progress and results of our ongoing and planned future clinical trials of bentracimab, pemziviptadil, PB6440 and our other preclinical programs;

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•the timing and amount of payments we receive under the SFJ Agreement and the Alfasigma Sublicense;

•the scope, progress, results and costs of preclinical development, laboratory testing and clinical trials for any future product candidates we may decide to pursue;

•the extent to which we develop, in-license or acquire other product candidates and technologies;

•the number and development requirements of other product candidates that we may pursue;

•the costs, timing and outcome of regulatory review of our product candidates;

•the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval;

•the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval;

•our ability to establish collaborations to commercialize pemziviptadil in the United States;

•our ability to establish collaborations to commercialize bentracimab, pemziviptadil or any of our other product candidates outside of the United States; and

•the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims.

Identifying potential product candidates and conducting preclinical studies and clinical trials is a time-consuming, expensive and uncertain process that takes many years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product sales. In addition, our product candidates, if approved, may not achieve commercial success. Our commercial revenues, if any, will be derived from sales of product candidates that we do not expect to be commercially available in the near term, if at all.

Our future commercial revenue, if any, will be derived from sales of products that we do not expect to be commercially available for several years, if at all. Accordingly, we will need to continue to rely on additional financing to achieve our business objectives. Adequate additional financing may not be available to us on acceptable terms, or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the terms of these equity securities or this debt may restrict our ability to operate. Any future debt financing and equity financing, if available, may involve agreements that include covenants limiting and restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, entering into profit-sharing or other arrangements or declaring dividends. If we raise additional funds through government or private grants, collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may be required to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or to grant licenses on terms that may not be favorable to us. Further, our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from the ongoing COVID-19 pandemic.

Off-Balance Sheet Arrangements

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements, as defined in the SEC rules and regulations.

Critical Accounting Policies and Significant Judgments and Estimates

Our management’s discussion and analysis of our financial condition and results of operations is based on our condensed financial statements, which have been prepared in accordance with United States generally accepted accounting policies, or GAAP. The preparation of these condensed financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities as of the dates of the balance sheets and the reported amounts of expenses during the reporting periods. In accordance with GAAP, we evaluate our estimates and judgments on an ongoing basis.

Significant estimates include assumptions we have used in the determination of accrued research and development costs and those used for the inputs in our valuation of the development derivative liability. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

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There were no material changes to our critical accounting policies as disclosed in our audited financial statements for the years ended December 31, 2020 and 2019 included in our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 15, 2021, other than as described below.

We identified the following policy as a new critical policy that reflects significant judgments or uncertainties and potentially may result in materially different results under different assumptions and conditions.

Sublicense revenue

In June 2021, we entered into the Alfasigma Sublicense, pursuant to which Alfasigma will provide funding in exchange for the exclusive rights to develop, use, sell, have sold, offer for sale and import any product composed of or containing bentracimab in the Sublicense Territory.

Sublicensing arrangements may contain multiple components, which may include (i) sublicenses; (ii) research and development activities; and (iii) the manufacturing and supply of certain materials. Payments pursuant to these arrangements may include non-refundable, upfront payments, milestone payments upon the achievement of significant regulatory and development events or sales of product at certain agreed upon amounts, sales milestones and royalties on product sales. The amount of variable consideration is constrained until it is probable that the revenue is not at a significant risk of reversal in a future period.

In determining the appropriate amount of revenue to be recognized as we fulfill our obligations under the sublicense agreement, we perform the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are capable of being distinct; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations and (v) recognition of revenue as we satisfy each performance obligation.

We must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation, which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as forecasted revenues and costs, development timelines, discount rates and probabilities of regulatory and commercial success. We also apply significant judgment when evaluating whether contractual obligations represent distinct performance obligations, allocating transaction price to performance obligations within a contract, determining when performance obligations have been met, assessing the recognition and future reversal of variable consideration and determining and applying appropriate methods of measuring progress for performance obligations satisfied over time.

Recent Accounting Pronouncements

See “Note 2. Significant Accounting Policies” in “Notes to Condensed Financial Statements” located in “Part I – Financial Information, Item 1. Condensed Financial Statements” in this Quarterly Report on Form 10-Q for information concerning recent accounting pronouncements.

Item 3.    Quantitative and Qualitative Disclosures About Market Risks

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

Item 4.    Controls and Procedures

Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, to allow timely decisions regarding required disclosure.

The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

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With respect to the quarter ended June 30, 2021, under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of the design and operations of our disclosure controls and procedures. Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective.

Management does not expect that our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control systems are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in a cost-effective control system, no evaluation of internal control over financial reporting can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been or will be detected.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the fiscal quarter ended June 30, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1.    Legal Proceedings

We are not subject to any material legal proceedings. From time to time, we may be involved in various claims and legal proceedings relating to claims arising out of our operations. We are not currently a party to any legal proceedings that, in the opinion of our management, are likely to have a material adverse effect on our business. Regardless of outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

Item 1A.    Risk Factors

The following information sets forth risk factors that could cause our actual results to differ materially from those contained in forward-looking statements we have made in this Quarterly Report on Form 10-Q and those we may make from time to time. You should carefully consider the risks described below, in addition to the other information contained in this Quarterly Report on Form 10-Q and our other public filings. Our business, financial condition or results of operations could be harmed by any of these risks. The risks and uncertainties described below are not the only ones we face. Additional risks not presently known to us or other factors not perceived by us to present significant risks to our business at this time also may impair our business operations.

Summary of Risk Factors

Our business is subject to a number of risks of which you should be aware before making a decision to invest in our common stock. These risks are more fully described in this “Risk Factors” section, including the following:

•The ongoing COVID-19 pandemic has and may continue to adversely impact our business and operations, including our clinical trials.

•We have incurred significant losses since our inception. We expect to incur losses over the next several years and may never achieve or maintain profitability.

•We will need substantial additional funding to meet our financial obligations and to pursue our business objectives. If we are unable to raise capital when needed, we could be forced to curtail our planned operations and the pursuit of our growth strategy.

•If we receive regulatory approval for bentracimab, or alternatively if the SFJ Agreement is terminated, we will be required to make substantial payments to SFJ pursuant to the SFJ Agreement. If we do not have sufficient funding or cash flow from our business to meet our payment obligations under the SFJ Agreement, SFJ could exercise its remedies as a holder of a first-priority security interest in our assets and our business could be materially harmed.

•We currently have only two clinical-stage product candidates, bentracimab, a ticagrelor reversal agent, and pemziviptadil for the treatment of PAH. If we are unable to successfully develop, receive regulatory approval for and commercialize our product candidates for these or any other indications, or successfully develop any other product candidates, or experience significant delays in doing so, our business will be harmed.

•Based on feedback from the U.S. Food & Drug Administration, or FDA, we intend to seek regulatory approval of bentracimab in the United States through an accelerated approval process. If we are not successful with this process, including the interim analysis, the development and commercialization of bentracimab could be delayed, abandoned or become significantly more costly.

•If Alfasigma does not satisfy its obligations under our agreement with them, or if they terminate our partnership with them, we may not be able to commercialize our partnered product candidates as planned and our expected revenue from this agreement could be materially affected.

•Success in preclinical studies or earlier clinical trials may not be indicative of results in future clinical trials.

•As an organization, we have never completed pivotal clinical trials, and we may be unable to do so for any product candidates we may develop.

•Elastin-like polypeptide, or ELP, is a novel technology, which makes it difficult to predict the time, risks and cost of development and the ability to subsequently obtain regulatory approval of our ELP product candidates.

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•We may not be successful in our efforts to increase our pipeline of product candidates, including by pursuing additional indications for our current product candidates or in-licensing or acquiring additional product candidates for other diseases.

•Market acceptance of bentracimab, if approved, will depend heavily on the continued market acceptance and use of ticagrelor.

•We currently rely, and expect to continue to rely, on third parties for the cGMP manufacture of bentracimab, pemziviptadil, PB6440 and any other product candidates that we may pursue for clinical development as well as for commercial manufacture of bentracimab, pemziviptadil, PB6440 and any other product candidates that we may pursue, if we receive marketing approval. This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.

•If we are unable to obtain or protect intellectual property rights related to any of our product candidates, we may not be able to compete effectively in our market.

•If we fail to comply with our obligations in our current and future intellectual property licenses and funding arrangements with third parties, we could lose rights that are important to our business.

Risks Related to Our Financial Position and Capital Needs

The ongoing COVID-19 pandemic has and may continue to adversely impact our business and operations, including our clinical trials.

Our business operations have and may continue to be adversely affected by the effects of the ongoing COVID-19 pandemic. The U.S., state and local governments have and may in the future impose travel and other restrictions in order to reduce the spread of the disease and its variants, including state and local orders across the United States that, among other things, direct individuals to shelter at their places of residence, direct businesses and governmental agencies to cease non-essential operations at physical locations, prohibit certain non-essential gatherings and events and order cessation of non-essential travel. In response to public health directives and orders, we have implemented work-from-home policies for all employees.

We have and may continue to experience disruptions due to the COVID-19 pandemic that could severely impact our business and clinical trials, including:

•delays, difficulties or a suspension in enrolling patients in our ongoing and planned clinical trials;

•delays, difficulties or a suspension in clinical site initiation, including difficulties in recruiting clinical site investigators and clinical site staff;

•interruptions in our ability to manufacture and deliver drug supply for trials;

•diversion of healthcare resources away from the conduct of clinical trials, including the diversion of hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;

•interruption of key clinical trial activities, such as clinical trial site monitoring, and the ability or willingness of subjects to travel to trial sites due to limitations on travel imposed or recommended by federal or state governments, employers and others; and

•limitations in employee resources that would otherwise be focused on the conduct of our clinical trials, including because of sickness of employees or their families or the desire of employees to avoid contact with large groups of people.

For our clinical trials that are planned to be conducted at sites in countries that are experiencing heightened impact from COVID-19, in addition to the risks listed above, we have and may continue to also experience the following adverse impacts:

•delays in receiving approvals from local regulatory authorities to initiate our planned clinical trials;

•delays in clinical sites receiving the supplies and materials needed to conduct our clinical trials;

•interruption in global shipping that may affect the transport of clinical trial materials, such as investigational drug product used in our clinical trials;

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•changes in local regulations as part of a response to the COVID-19 outbreak which may require us to change the ways in which our clinical trials are conducted, which may result in unexpected costs, or to discontinue the clinical trials altogether;

•delays in necessary interactions with local regulators, ethics committees and other important agencies and contractors due to limitations in employee resources or forced furlough of government employees; and

•refusal of the FDA to accept data from clinical trials in these affected geographies.

As we advance our clinical programs for bentracimab and pemziviptadil with site activations and patient enrollment, we remain in close contact with our clinical research organizations, or CROs, clinical sites and suppliers to attempt to assess the impacts that COVID-19 may have on our clinical trials and current timelines and to consider whether we can implement appropriate mitigating measures to help to lessen such impacts. At this time, however, we cannot currently fully forecast the scope of impacts that COVID-19 may have on our ability to initiate trial sites, enroll and assess patients, supply study drug and report trial results.

We have commenced our pivotal REVERSE-IT trial for bentracimab and are currently working to identify and initiate additional clinical sites for this study, although the COVID-19 pandemic continues to impact the pace of site initiation and patient enrollment, including the types of patients enrolling in the trial. As of August 9, we have enrolled the first 143 patients in the REVERSE-IT trial and are targeting to release top-line results from the interim analysis later in 2021 and submit our BLA for bentracimab in mid-2022, although this timeline could be impacted by the continued scope and duration of the COVID-19 pandemic.

With respect to our pemziviptadil program, we are currently dosing patients in a randomized, double-blinded, controlled Phase 2b clinical trial in which we plan to enroll approximately 60 PAH patients to assess the safety, tolerability and efficacy of pemziviptadil. We currently expect to report the top-line results of this trial in mid-2022.

We have completed enrollment for our Phase 2b bentracimab trial, which is a multi-center, randomized, double-blind, placebo-controlled trial that is designed to evaluate the safety and efficacy of PB2452 in reversing the antiplatelet effects of ticagrelor in healthy adults who are older and elderly (ages 50 to 80) as part of a dual antiplatelet regimen including low-dose aspirin. We expect to report top-line results for this trial later in 2021.

We plan to initiate IND -enabling activities for PB6440 in 2021, which are expected to be followed by an IND submission in 2022, although those timelines could be impacted by the scope and duration of the COVID-19 pandemic.

In addition, remote work policies, quarantines, shelter-in-place and similar government orders, shutdowns or other restrictions on the conduct of business operations related to the COVID-19 pandemic could negatively impact productivity, disrupt our ongoing research and development activities and impact our operations, the magnitude of which will depend, in part, on the length and severity of the restrictions and other limitations and their effect on our ability to conduct our business in the ordinary course. In addition, although our employees are accustomed to working remotely, changes in internal controls due to remote work arrangements could potentially result in control deficiencies in the preparation of our financial reports, which could be significant.

The spread of COVID-19 and its variants, which has had a broad impact globally, may materially affect us economically. While the potential economic impact brought by, and the continued duration of, the COVID-19 pandemic may be difficult to assess or predict, a continued and growing pandemic could result in significant disruption of global financial markets, reducing our ability to access capital, which could in the future negatively affect our liquidity. In addition, a recession or market correction resulting from the spread of COVID-19 and its variants could materially affect our business and the value of our common stock.

The global COVID-19 pandemic continues to rapidly evolve. The extent to which COVID-19 may impact our business and clinical trials will depend on future developments that are highly uncertain and cannot be predicted with confidence, such as the geographic spread of the disease and its variants over time, the continued duration of the pandemic, travel restrictions and social distancing in the United States and other countries, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease, including the efficacy and availability of vaccines and antiviral agents against the disease and the success of vaccination efforts. Accordingly, we do not yet know the full extent of potential delays or impacts on our business, our clinical and regulatory activities, healthcare systems or the global economy as a whole. However, these impacts could adversely affect our business, financial condition, results of operations and growth prospects.

In addition, to the extent the ongoing COVID-19 pandemic adversely affects our business and results of operations, it may also have the effect of heightening many of the other risks and uncertainties described in this “Risk Factors” section.

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We have incurred significant losses since our inception. We expect to incur losses over the next several years and may never achieve or maintain profitability.

We are a clinical-stage biopharmaceutical company. Since our inception, we have incurred significant net losses. Our net loss was $56.0 million for the six months ended June 30, 2021. As of June 30, 2021, we had an accumulated deficit of $316.8 million. We expect to continue to incur significant expenses and operating losses for the foreseeable future. Since inception, we have financed our operations primarily with proceeds raised in our initial public offering, sales of shares of our common stock in an underwritten public offering pursuant to an effective shelf registration statement on Form S-3, private placements of convertible debt and convertible preferred stock, borrowings under our term loan, funds we have received under the SFJ Agreement and funds we have received pursuant to the Alfasigma Sublicense. In future periods we expect SFJ to provide up to $42.5 million of funding pursuant to the SFJ Agreement, $30.0 million of which we are eligible to receive upon the achievement of specified milestones with respect to our clinical development of bentracimab. We have no products approved for commercialization and have never generated any revenue from product sales.

We have devoted substantially all of our financial resources and efforts to the development of our clinical and preclinical product candidates and our proprietary half-life extending ELP technology, including conducting preclinical studies and clinical trials. We expect to continue to incur significant expenses and operating losses over the next several years. We expect that it could be several years, if ever, before we have a commercialized product. Our net losses may fluctuate significantly from quarter to quarter and year to year. We anticipate that our expenses will increase substantially as we:

•continue our ongoing clinical trials of bentracimab and pemziviptadil, as well as initiate and complete additional clinical trials, as needed;

•seek to expand our geographical reach through the SFJ Agreement and the corresponding clinical development support fees that we will incur;

•pursue regulatory approvals for bentracimab as a reversal agent for the antiplatelet drug ticagrelor and pemziviptadil for the treatment of PAH;

•develop PB6440 for treatment-resistant hypertension;

•seek to discover and develop additional clinical and preclinical product candidates;

•scale up our clinical and regulatory capabilities;

•establish a commercialization infrastructure and scale up external manufacturing and distribution capabilities to commercialize any product candidates for which we may obtain regulatory approval, including bentracimab and pemziviptadil;

•adapt our regulatory compliance efforts to incorporate requirements applicable to marketed products;

•maintain, expand and protect our intellectual property portfolio;

•hire additional clinical, manufacturing and scientific personnel;

•add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts; and

•incur additional legal, accounting and other expenses in operating as a public company.

To become and remain profitable, we must succeed in developing and eventually commercializing product candidates that generate significant revenue. This will require us to be successful in a range of challenging activities, including completing preclinical testing and clinical trials of our product candidates, obtaining regulatory approval, and manufacturing, marketing and selling any product candidates for which we may obtain regulatory approval, as well as discovering and developing additional product candidates. We are only in the preliminary stages of most of these activities. We may never succeed in these activities and, even if we do, may never generate any revenue or revenue that is significant enough to achieve profitability.

Even if we achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to become and remain profitable would depress the value of our company and could impair our ability to raise capital, expand our business, maintain our development efforts, obtain product approvals, diversify our offerings or continue our operations. A decline in the value of our company could also cause you to lose all or part of your investment.

We have no history of commercializing products, which may make it difficult for an investor to evaluate the success of our business to date and to assess our future viability.

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We commenced operations in 2002, and our operations to date have been largely focused on raising capital and developing our clinical and preclinical product candidates and our proprietary ELP half-life extending technology, including undertaking preclinical studies and conducting clinical trials. To date, we have not yet demonstrated our ability to successfully complete pivotal clinical trials, obtain regulatory approvals, manufacture a product on a commercial scale, or arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful commercialization. Consequently, any predictions you make about our future success or viability may not be as accurate as they could be if we had a longer operating history or a history of successfully developing and commercializing products.

We may encounter unforeseen expenses, difficulties, complications, delays and other known or unknown factors in achieving our business objectives. We will need to develop commercial capabilities, and we may not be successful in doing so.

We will need substantial additional funding to meet our financial obligations and to pursue our business objectives. If we are unable to raise capital when needed, we could be forced to curtail our planned operations and the pursuit of our growth strategy.

Our operations have consumed substantial amounts of cash since inception. Identifying potential product candidates and conducting preclinical testing and clinical trials is a time-consuming, expensive and uncertain process that takes years to complete, and we may never generate the necessary data or results required to obtain regulatory approval and achieve product sales. We expect to continue to incur significant expenses and operating losses over the next several years as we complete our ongoing clinical trials of our product candidates, initiate future clinical trials of our product candidates, seek marketing approval for bentracimab as a ticagrelor reversal agent and pemziviptadil for the treatment of PAH, develop PB6440 for treatment-resistant hypertension and advance any of our other product candidates we may develop or otherwise acquire. In addition, our product candidates, if approved, may not achieve commercial success. Our revenue, if any, will be derived from sales of products that we do not expect to be commercially available for a number of years, if at all. If we obtain marketing approval for bentracimab, pemziviptadil, PB6440 or any other product candidates that we develop or otherwise acquire, we expect to incur significant commercialization expenses related to product sales, marketing, distribution and manufacturing. We also expect an increase in our expenses associated with creating additional infrastructure to support operations as a public company.

We have experienced net losses and negative cash flows from operations and, as of June 30, 2021, had an accumulated deficit of $316.8 million. We expect to continue to incur net losses for at least the next several years. As of June 30, 2021, we had cash and cash equivalents of $64.5 million. We believe that our existing cash and cash equivalents as of June 30, 2021, in addition to the $20.0 million that we received from Alfasigma in July 2021 pursuant to the Alfasigma Sublicense and the $12.5 million of clinical trial costs and other expenses that we expect SFJ will fund or reimburse pursuant to the SFJ Agreement, will be sufficient to fund our operating expenses and capital requirements through the fourth quarter of 2022. Our future capital requirements will depend on many factors, including:

•the progress and results of our ongoing and planned future clinical trials of bentracimab and pemziviptadil and our development of PB6440 and other preclinical programs;

•the timing and amount of any payments we receive under the SFJ Agreement, and our ability to comply with our capitalization requirements under the SFJ Agreement;

•the achievement of regulatory milestones, commercial milestones, and royalties that we are eligible to earn pursuant to the Alfasigma Sublicense;

•the scope, progress, results and costs of preclinical development, laboratory testing and clinical trials for any future product candidates we may decide to pursue;

•the extent to which we develop, in-license or acquire other product candidates and technologies;

•the number and development requirements of other product candidates that we may pursue;

•the costs, timing and outcome of regulatory review of our product candidates;

•the costs and timing of future commercialization activities, including product manufacturing, marketing, sales and distribution, for any of our product candidates for which we receive marketing approval;

•the amount of revenues, if any, received from commercial sales of our product candidates for which we receive marketing approval;

•our ability to establish collaborations to commercialize pemziviptadil in the United States;

•our ability to establish collaborations to commercialize bentracimab, pemziviptadil, PB6440 or any of our other product candidates outside the United States; and

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•the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims.

We will require additional capital to commercialize bentracimab, pemziviptadil and PB6440. If we receive regulatory approval for any of these product candidates, we expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution depending on where we choose to commercialize. Additional funds may not be available on a timely basis, on favorable terms, or at all, and such funds, if raised, may not be sufficient to enable us to continue to implement our long-term business strategy. Further, our ability to raise additional capital may be adversely impacted by potential worsening global economic conditions and the disruptions to and volatility in the credit and financial markets in the United States and worldwide resulting from the ongoing COVID-19 pandemic. If we are unable to raise sufficient additional capital, we could be forced to curtail our planned operations and the pursuit of our growth strategy.

Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our technologies or product candidates.

Until such time, if ever, as we can generate substantial revenue, we may finance our cash needs through a combination of equity offerings, government or private party grants, debt financings and license and collaboration agreements. Except with respect to the funding obligations pursuant to the SFJ Agreement and the Alfasigma License, we do not currently have any other committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a common stockholder. For example, in June 2021 we issued and sold 18,400,000 shares of our common stock in an underwritten public offering pursuant to an effective shelf registration statement on Form S-3, resulting in immediate dilution to our stockholders. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. For example, under the SFJ Agreement, we granted SFJ a first-priority security interest in all of our assets related to bentracimab, subject only to the lien of SVB and WestRiver, or the Lenders, for existing indebtedness to the Lenders. In connection with the grant of the security interest, we agreed to certain affirmative and negative covenants, including restrictions on our ability to pay dividends, incur additional debt or enter into licensing transactions with respect to intellectual property related to bentracimab. Similarly, our loan and security agreement with the Lenders is secured by a security interest in substantially all of our current and future assets. We are also obligated to comply with various other customary covenants, including restrictions on our ability to encumber our intellectual property assets. The security interests granted to SFJ and the Lenders may preclude future debt financing or make the terms of such financings less favorable.

If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may be required to relinquish valuable rights to our technologies, future revenue streams or product candidates, grant licenses on terms that may not be favorable to us or commit to future payment streams. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.

If we receive regulatory approval for bentracimab, or alternatively if the SFJ Agreement is terminated, we will be required to make substantial payments to SFJ pursuant to the SFJ Agreement. If we do not have sufficient funding or cash flow from our business to meet our payment obligations under the SFJ Agreement, SFJ could exercise its remedies as a holder of a first-priority security interest in our assets and our business could be materially harmed.

On January 9, 2020, we entered into the SFJ Agreement, pursuant to which SFJ agreed to provide up to $120.0 million to support the global development of bentracimab. If we receive regulatory approval for bentracimab as a reversal agent for the antiplatelet drug ticagrelor, we will be required to make substantial payments to SFJ pursuant to the SFJ Agreement. Our ability to make these required payments will depend on our future performance, which will be subject to economic, financial, competitive and other factors beyond our control. Our business may not generate cash flow from operations in the future sufficient to meet our obligations under the SFJ Agreement. If we are unable to generate such cash flow or to obtain additional funding through public or private equity offerings, debt financings, collaborations and licensing arrangements or other sources on acceptable terms or at all, we could default on our payment obligations to SFJ. We have granted SFJ a first-priority security interest in all of our assets related to bentracimab, subject only to the lien of the Lenders for existing indebtedness to the Lenders. If we are unable to meet our payment obligations to SFJ, SFJ may exercise its remedies as a holder of a first-priority security interest, which would result in a loss of our assets and our business would be materially harmed.

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In addition, in the event that (i) we fail to pay any amounts payable to SFJ under the SFJ Agreement within a specified time period, (ii) we are in default of our obligations (subject to certain exclusions) under the MedImmune License or (iii) either (a) we determine it is probable that we will be unable to meet our obligations as they become due within one year after the date that our financial statements for the then-current quarter are issued, or available to be issued or (b) a “going concern” footnote is included in any of our financial statements, and, in either case ((a) or (b)), we fail to remedy such going concern condition as specified in the agreement, SFJ may elect to have our business related to bentracimab transferred to SFJ. We have multiple quarters in which to remedy the going concern condition, including by restructuring our costs and operations, raising additional capital in financing or strategic transactions or accepting additional financing from SFJ on the same terms as their original commitment (which additional financing they have the option, but not obligation, to provide). The auditor's opinion on the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020 contained an explanatory paragraph related to our substantial doubt about our ability to continue as a going concern, thus creating a "going concern" condition under the SFJ Agreement. Although we subsequently cured the going concern condition, we cannot guarantee that we will not have any future going concern qualifications in our financial statements. Furthermore, although we believe that the cure periods in the SFJ Agreement are sufficient to enable us to remedy any going concern condition, if we are unable to do so and if our business related to bentracimab is transferred to SFJ, we will not share in any revenues from the commercialization of bentracimab until SFJ has received a 300% return on its investment in bentracimab, after which we will be entitled to a mid-single-digit royalty on net sales of bentracimab in the United States and certain European countries, and after SFJ has received an aggregate 500% return on its investment in bentracimab, we will be entitled to a mid-single-digit royalty on net sales of bentracimab in the rest of the world.

In the event that the SFJ Agreement is terminated, we will be obligated to make substantial payments to SFJ. If following termination of the SFJ Agreement we continue to develop bentracimab and obtain BLA approval in the United States, the European Union, Japan or China, we will be obligated to pay applicable approval payments for any such jurisdiction to SFJ as if the SFJ Agreement had not been terminated, less any payments made upon termination, except in limited circumstances. Further, if our business related to SFJ is transferred to SFJ in the event that we breach certain provisions of the SFJ Agreement, we will not share in any revenues from the commercialization of bentracimab until SFJ has received an at least 300% return on its investment in bentracimab. Such payment obligations could have significant consequences for our stockholders and our business, results of operations and financial condition and could force us to delay or terminate development of bentracimab or other product candidates.

If Alfasigma does not satisfy its obligations under our agreement with them, or if they terminate our partnership with them, we may not be able to commercialize our partnered product candidates as planned and our expected revenue from thiese agreements could be materially affected.

We have entered into an exclusive sublicense agreement with Alfasigma under which we granted to Alfasigma exclusive rights to develop, use, sell, have sold, offer for sale and import the Licensed Products in the Sublicense Territory. Under the Alfasigma Sublicense, we are responsible for developing the Licensed Products and securing regulatory approval with the EMA and the MHRA, including in accordance with the SFJ Agreement, after which any marketing authorizations will be assigned to Alfasigma. Alfasigma is obligated to obtain and maintain any regulatory approvals necessary to market and sell the Licensed Products (including pricing approvals and post-marketing commitments) and is also responsible for securing regulatory approval in countries outside of Europe and the United Kingdom. We will supply Alfasigma’s requirements for Licensed Product at the lower of cost or a price not to exceed certain agreed amounts.

Alfasigma may not fulfill all of its obligations under this agreement, and, in certain circumstances, they or we may terminate the sublicense. In such an event, we may be unable to assume the sublicense responsibilities or find a suitable alternative commercial partner to commercialize the Licensed Products in the Sublicense Territory. If Alfasigma elected to promote alternative products and product candidates, such as its own products and product candidates, in preference to those licensed from us, does not devote an adequate amount of time and resources to our product candidates or is otherwise unsuccessful in its efforts with respect to our products or product candidates, the commercialization of the Licensed Products could be delayed or terminated, future payments to us could be delayed, reduced or eliminated, and our business and financial condition could be materially and adversely affected. Accordingly, our ability to receive any revenue from the Licensed Products in the Sublicensed Territory is dependent on the efforts of Alfasigma.

Risks Related to the Development of Our Product Candidates

We currently have only two clinical-stage product candidates, bentracimab, a ticagrelor reversal agent, and pemziviptadil for the treatment of PAH. If we are unable to successfully develop, receive regulatory approval for and commercialize our product candidates for these or any other indications, or successfully develop any other product candidates, or experience significant delays in doing so, our business will be harmed.

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We currently have no products that are approved for commercial sale. We currently have only two clinical-stage product candidates, bentracimab and pemziviptadil. To date, we have not yet completed any pivotal clinical trials. We have not completed the development of any product candidates, and we may never be able to develop marketable products.

We have invested substantially all of our efforts and financial resources in the development of our clinical and preclinical product candidates and our proprietary ELP technology. Our ability to generate revenue from our product candidates, which we do not expect will occur for several years, if ever, will depend heavily on the successful development, regulatory approval and eventual commercialization of our product candidates. The success of bentracimab, pemziviptadil, PB6440 or any other product candidates that we develop or otherwise may acquire will depend on several factors, including:

•timely and successful completion of preclinical studies and clinical trials;

•sufficiency of our financial and other resources to complete the necessary preclinical studies and clinical trials;

•successful enrollment, including with respect to the various indications for which we might seek approval of bentracimab, and completion of clinical trials;

•with respect to bentracimab, the success of our collaboration with SFJ;

•successful development of, or making arrangements with third-party manufacturers for, our commercial manufacturing processes for any of our product candidates that receive regulatory approval;

•receipt of timely marketing approvals from applicable regulatory authorities;

•launching commercial sales of products, if approved;

•acceptance of our products, if approved, by patients, the medical community and third-party payors, for their approved indications;

•Alfasigma's ability to successfully launch, distribute and sell bentracimab pursuant to the Alfasigma Sublicense;

•the prevalence and severity of adverse events experienced with bentracimab, pemziviptadil, PB6440 or any other product candidates;

•the availability, perceived advantages, cost, safety and efficacy of alternative therapies for any product candidate, and any indications for such product candidate, that we develop, specifically, alternative reversal agents or antiplatelet therapies to ticagrelor (including therapies that may be developed with a reversal agent), or alternative treatments for PAH or treatment-resistant hypertension;

•our ability to produce bentracimab, pemziviptadil, PB6440 or any other product candidates we develop on a commercial scale;

•obtaining and maintaining patent, trademark and trade secret protection and regulatory exclusivity for our product candidates and otherwise protecting our rights in our intellectual property portfolio;

•maintaining compliance with regulatory requirements, including current good manufacturing practices, or cGMPs, and complying effectively with other procedures; and

•maintaining a continued acceptable safety, tolerability and efficacy profile of the products following approval.

If we are not successful with respect to one or more of these factors in a timely manner or at all, we could experience significant delays or an inability to successfully commercialize the product candidates we develop, which would materially harm our business. If we do not receive marketing approvals for bentracimab, pemziviptadil, PB6440 or any other product candidate we develop, we may not be able to continue our operations.

The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable. If we are not able to obtain required regulatory approval for our product candidates, our business will be substantially harmed.

The time required to obtain approval or other marketing authorizations by the FDA and comparable foreign authorities is unpredictable, and it typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities. In addition, approval policies, regulations, and the type and amount of clinical data necessary to gain approval may change during the course of a product candidate’s clinical

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development and may vary among jurisdictions. Bentracimab and pemziviptadil are currently our only clinical-stage product candidates. We have not obtained regulatory approval for any product candidate, and it is possible that we may never obtain regulatory approval for bentracimab, pemziviptadil, PB6440 or any product candidates we may seek to develop in the future. Neither we nor any current or future collaborator is permitted to market any drug product candidates in the United States until we receive regulatory approval of a BLA, or a new drug application, or NDA, from the FDA. To date, we have only had limited discussions with the EMA and other comparable foreign authorities regarding regulatory approval for bentracimab, pemziviptadil or any other product candidate outside of the United States.

Prior to obtaining approval to commercialize any drug product candidate in the United States or abroad, we must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA or foreign regulatory agencies, that such product candidates are safe, pure and effective for their intended uses. Results from preclinical studies and clinical trials can be interpreted in different ways. Even if we believe the preclinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities. The FDA may also require us to conduct additional preclinical studies or clinical trials for our product candidates either prior to or after approval, or it may object to elements of our clinical development programs.

Of the large number of products in development, only a small percentage successfully complete the FDA or foreign regulatory approval processes and are commercialized. The lengthy approval and marketing authorization process as well as the unpredictability of future clinical trial results may result in our failing to obtain regulatory approval and marketing authorization to market our product candidates, which would significantly harm our business, financial condition, results of operations and prospects.

We have invested a significant portion of our time and financial resources in the development of our clinical and preclinical product candidates, including bentracimab, pemziviptadil and PB6440. Our business is dependent on our ability to successfully complete preclinical and clinical development of, obtain regulatory approval for, and, if approved, successfully commercialize bentracimab, pemziviptadil, PB6440 and any future product candidates in a timely manner.

Even if we eventually complete clinical testing and receive approval of a BLA, NDA or foreign marketing application for bentracimab, pemziviptadil, PB6440 or any future product candidates, the FDA or the applicable foreign regulatory agency may grant approval or other marketing authorization contingent on the performance of costly additional clinical trials, including post-marketing clinical trials. The FDA or the applicable foreign regulatory agency also may approve or authorize for marketing a product candidate for a more limited indication or patient population than we originally request, and the FDA or applicable foreign regulatory agency may not approve or authorize the labeling that we believe is necessary or desirable for the successful commercialization of a product candidate. Any delay in obtaining, or inability to obtain, applicable regulatory approval or other marketing authorization would delay or prevent commercialization of that product candidate and would materially adversely impact our business and prospects.

In addition, the FDA and other regulatory authorities may change their policies, issue additional regulations or revise existing regulations, or take other actions, which may prevent or delay approval of our future products under development on a timely basis. Such policy or regulatory changes could impose additional requirements upon us that could delay our ability to obtain approvals, increase the costs of compliance or restrict our ability to maintain any marketing authorizations we may have obtained.

Based on feedback from the FDA, we intend to seek regulatory approval of bentracimab in the United States through an accelerated approval process. If we are not successful with this process, the development and commercialization of bentracimab could be delayed, abandoned or significantly more costly.

The FDA’s accelerated approval regulations allow drugs that are being developed to treat an unmet medical need to be approved substantially based on evidence of an effect on a surrogate biomarker endpoint that is considered reasonably likely to predict clinical benefit, rather than a clinical endpoint such as survival or irreversible morbidity. Based on feedback from the FDA, our strategy is to use an accelerated approval pathway that may require that our REVERSE-IT trial of bentracimab be ongoing at the time of BLA approval. To support our BLA submission for accelerated approval, the FDA recommended an interim analysis of biomarker data from an initial subset of 100 patients, with approximately 50 patients with uncontrolled major or life-threatening bleeding and approximately 50 patients requiring urgent surgery or an invasive procedure, in our REVERSE-IT trial, together with safety data from our Phase 2 clinical trials, although the FDA indicated that whether there are an adequate number of patients with uncontrolled major or life-threatening bleeding or requiring urgent surgery or an invasive procedure would be a review issue.

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We intend to complete the REVERSE-IT trial and establish a post-approval registry in accordance with FDA requirements. With regards to the 200 total patients needed for full enrollment of the REVERSE-IT trial, our protocol provides that no more than approximately two-thirds of patients can come from either the uncontrolled major or life-threatening bleeding population or the patient population requiring urgent surgery or an invasive procedure. The CHMP, of the EMA, has also generally agreed with our proposed clinical development plan for bentracimab.

As of August 9, 2021, we have enrolled 143 patients in the REVERSE-IT trial. Because the total number of patients enrolled to date includes 138 patients who required urgent surgery or an invasive procedure, this cohort of the trial has been fully enrolled, and trial sites have shifted focus to enrolling patients with uncontrolled major or life-threatening bleeding events. We intend to submit our BLA for potential accelerated approval based on an interim analysis of these first 143 patients, all of whom have been measured against the same VerifyNow PRUTest biomarker and hemostasis endpoints. For our interim analysis, we elected to continue to enroll ticagrelor patients in excess of our prior target of approximately 100 patients in order to take advantage of our robust surgical enrollment and due to continued uncertainties caused by the COVID-19 pandemic and its potential impact on future patient availability. We are targeting to release top-line results from the interim analysis later in 2021 and to submit our BLA in mid-2022, although that timeline could be impacted by the continued scope and duration of the COVID-19 pandemic.

We intend to continue to enroll patients in the REVERSE-IT trial and will primarily target enrolling patients with uncontrolled major or life-threatening bleeding. We are continuing to attempt to accelerate enrollment of these patients, including by working to increase the number of enrolling clinical trial sites in the United States, Canada, and the European Union as we believe that a broader site footprint will increase the probability of enrolling these patients. We are also expecting to begin enrolling patients in China for the REVERSE-IT trial later in 2021.

Following the submission of our BLA, the FDA could determine that we did not enroll a sufficient number of patients in the REVERSE-IT trial, including patients with uncontrolled major or life-threatening bleeding, for all or some of the proposed indications we intend to pursue. Further, the FDA may require us to conduct extensive post-approval studies or require us to make modifications to our ongoing REVERSE-IT trial after approval and marketing.

Clinical product development involves a lengthy and expensive process, with an uncertain outcome. We may incur additional costs and experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidates.

In order to obtain FDA approval to market a new biological or drug product we must demonstrate proof of safety, purity and efficacy in humans. The risk of failure for product candidates is high. It is impossible to predict when or if any of our product candidates will prove effective or safe in humans or will receive regulatory approval. Before obtaining marketing approval from regulatory authorities for the sale of any product candidate, we must complete preclinical development and then conduct extensive clinical trials to demonstrate the safety, purity, potency, and efficacy of our product candidates in humans. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome. A failure of one or more clinical trials can occur at any stage of testing or at any time during the trial process. The outcome of preclinical testing and early clinical trials may not be predictive of the results of later clinical trials, and interim results of a clinical trial do not necessarily predict final results. Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that have believed their product candidates performed satisfactorily in preclinical studies and clinical trials have nonetheless failed to obtain marketing approval of their products.

We have not completed all clinical trials required for the approval of any of our product candidates. We cannot assure you that any clinical trial that we are conducting, or may conduct in the future, will demonstrate consistent or adequate efficacy and safety to obtain regulatory approval to market our product candidates.

We may incur additional costs and experience delays in ongoing clinical trials for our product candidates, and we do not know whether future clinical trials, if any, will begin on time, need to be redesigned, enroll an adequate number of patients on time or be completed on schedule, if at all. We may experience numerous unforeseen events during or as a result of clinical trials that could delay or prevent our ability to receive marketing approval or commercialize our product candidates, including:

•regulators or institutional review boards may not authorize us or our investigators to commence a clinical trial or conduct a clinical trial at a prospective trial site;

•we may experience delays in reaching, or fail to reach, agreement on acceptable clinical trial contracts or clinical trial protocols with prospective trial sites or prospective CROs, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;

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•clinical trials of our product candidates may produce negative or inconclusive results, including failure to demonstrate statistical significance, and we may decide, or regulators may require us, to conduct additional clinical trials or abandon product development programs;

•the number of patients required for clinical trials of our product candidates may be larger than we anticipate, enrollment in these clinical trials may be slower than we anticipate or participants may drop out of these clinical trials or fail to return for post-treatment follow-up at a higher rate than we anticipate;

•our product candidates may have undesirable side effects or other unexpected characteristics, causing us or our investigators, regulators or institutional review boards to suspend or terminate the trials;

•our third-party contractors may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all;

•regulators or institutional review boards may require that we or our investigators suspend or terminate clinical development for various reasons, including noncompliance with regulatory requirements or a finding that the participants are being exposed to unacceptable health risks;

•the cost of clinical trials of our product candidates may be greater than we anticipate; and

•the supply or quality of our product candidates or other materials necessary to conduct clinical trials of our product candidates may be insufficient or inadequate.

If we experience delays in the completion of any clinical trial of our product candidates or if any such trial is terminated, the commercial prospects of our product candidates will be harmed, and our ability to generate product revenues from any of these product candidates will be delayed. In addition, any delays in completing our clinical trials will increase our costs, slow down our product candidate development and approval process and jeopardize our ability to commence product sales and generate revenues.

If we are required to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are not favorable or if there are safety concerns, we may:

•be delayed in obtaining marketing approval for our product candidates;

•not obtain marketing approval at all;

•obtain approval for indications or patient populations that are not as broad as intended or desired;

•obtain approval with labeling that includes significant use or distribution restrictions or safety warnings;

•be subject to additional post-marketing testing requirements; or

•have the product removed from the market after obtaining marketing approval.

Success in preclinical studies or earlier clinical trials may not be indicative of results in future clinical trials.

Success in preclinical testing and early clinical trials does not ensure that later clinical trials will generate the same results or otherwise provide adequate data to demonstrate the efficacy and safety of a product candidate. Preclinical tests and Phase 1 and Phase 2 clinical trials are primarily designed to test safety, to study pharmacokinetics and pharmacodynamics and to understand the side effects of product candidates at various doses and schedules. Success in preclinical or animal studies and early clinical trials does not ensure that later large-scale efficacy trials will be successful nor does it predict final results. Our product candidates may fail to show the desired safety and efficacy in clinical development despite positive results in preclinical studies or having successfully advanced through initial clinical trials.

Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in late-stage clinical trials even after achieving promising results in preclinical testing and earlier-stage clinical trials. Data obtained from preclinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval. In addition, we may experience regulatory delays or rejections as a result of many factors, including changes in regulatory policy during the period of our product candidate development. Any such delays could negatively impact our business, financial condition, results of operations and prospects.

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Interim “top-line” and preliminary results from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.

From time to time, we may publish interim top-line or preliminary results from our clinical trials. Interim results 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. Preliminary or top-line results 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 preliminary data should be viewed with caution until the final data are available. Differences between preliminary or interim data and final data could significantly harm our business prospects and may cause the trading price of our common stock to fluctuate significantly.

Our clinical trials may fail to demonstrate the safety and efficacy of our product candidates, or serious adverse or unacceptable side effects may be identified during the development of our product candidates, which could prevent or delay regulatory approval and commercialization, increase our costs or necessitate the abandonment or limitation of the development of some of our product candidates.

Before obtaining regulatory approvals for the commercial sale of our product candidates, we must demonstrate through lengthy, complex and expensive preclinical testing and clinical trials that our product candidates are safe, pure and effective for use in each target indication, and failures can occur at any stage of testing. Clinical trials often fail to demonstrate safety or efficacy of the product candidate studied for the target indication. Based on the health profile of our patient population, it is possible that we may experience a serious adverse event that could prevent or delay regulatory approval and commercialization, increase our costs or necessitate the abandonment or limitation of the development of some of our product candidates.

If our product candidates are associated with side effects in clinical trials or have characteristics that are unexpected, we may need to abandon their development or limit development to more narrow uses in which the side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective. The FDA or an institutional review board may also require that we suspend, discontinue, or limit our clinical trials based on safety information, or that we conduct additional animal or human studies regarding the safety and efficacy of our product candidates which we have not planned or anticipated. Such findings could further result in regulatory authorities failing to provide marketing authorization for our product candidates or limiting the scope of the approved indication, if approved. Many product candidates that initially showed promise in early stage testing have later been found to cause side effects that prevented further development of the product candidate.

Additionally, if one or more of our product candidates receives marketing approval, and we or others identify undesirable side effects caused by such products, a number of potentially significant negative consequences could result, including:

•regulatory authorities may withdraw approvals of such product;

•regulatory authorities may require additional warnings on the labels;

•we may be required to 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;

•we may not be able to achieve or maintain third-party payor coverage and adequate reimbursement; and

•our reputation and physician or patient acceptance of our products may suffer.

There can be no assurance that we will resolve any issues related to any product-related adverse events to the satisfaction of the FDA or foreign regulatory agency in a timely manner or at all. Moreover, any of these events could prevent us from achieving or maintaining market acceptance of the particular product candidate, if approved, and could significantly harm our business, results of operations and prospects.

As an organization, we have never completed pivotal clinical trials, and we may be unable to do so for any product candidates we may develop.

We will need to successfully complete pivotal clinical trials in order to obtain the approval of the FDA, EMA or other regulatory agencies to market bentracimab, pemziviptadil, PB6440 or any future product candidate. Carrying out pivotal clinical trials is a complicated process. As an organization, we have not previously completed any later stage or pivotal clinical

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trials. In order to do so, we have needed to and will need to further expand our clinical development and regulatory capabilities, and we may be unable to recruit and train additional qualified personnel. We also expect to continue to rely on third parties to conduct our pivotal clinical trials. See “— Risks Related to our Dependence on Third Parties —We rely on third parties to conduct a significant portion of our existing clinical trials and potential future clinical trials for product candidates, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials.” In particular, pursuant to the SFJ Agreement, SFJ will have primary responsibility for clinical development and regulatory activities for bentracimab in China and Japan and will provide clinical trials operational support in the European Union. Consequently, we may be unable to successfully and efficiently execute and complete necessary clinical trials in a way that leads to BLA or NDA submission and approval of bentracimab, pemziviptadil, PB6440 or future product candidates. We may require more time and incur greater costs than our competitors and may not succeed in obtaining regulatory approvals of product candidates that we develop. Failure to commence or complete, or delays in, our planned clinical trials, could prevent us from or delay us in commercializing our product candidates.

If we experience delays or difficulties in the enrollment and/or maintenance of patients in clinical trials, our receipt of necessary regulatory approvals could be delayed or prevented.

Successful and timely completion of clinical trials will require that we enroll a sufficient number of patients. Patient enrollment, a significant factor in the timing of clinical trials, is affected by many factors, including the size and nature of the patient population. Trials may be subject to delays as a result of patient enrollment taking longer than anticipated or patient withdrawal. We may not be able to initiate or continue clinical trials for our product candidates if we are unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the FDA or foreign regulatory authorities. We cannot predict how successful we will be at enrolling subjects in future clinical trials. Subject enrollment is affected by other factors including:

•the eligibility criteria for the trial in question;

•the size of the patient population and process for identifying patients;

•the perceived risks and benefits of the product candidate in the trial;

•the availability of competing commercially available therapies and other competing drug candidates’ clinical trials;

•the willingness of patients to be enrolled in our clinical trials;

•the efforts to facilitate timely enrollment in clinical trials;

•potential disruptions caused by the COVID-19 pandemic, including difficulties in initiating clinical sites, enrolling and retaining participants, diversion of healthcare resources away from clinical trials, travel or quarantine policies that may be implemented, and other factors;

•the patient referral practices of physicians;

•the ability to monitor patients adequately during and after treatment; and

•the proximity and availability of clinical trial sites for prospective patients.

Our inability to enroll a sufficient number of patients for clinical trials would result in significant delays and could require us to abandon one or more clinical trials altogether. Enrollment delays in these clinical trials may result in increased development costs for our product candidates, which would cause the value of our company to decline and limit our ability to obtain additional financing. Additionally, we rely on and expect to continue to rely on CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials and we will have limited influence over their performance.

Furthermore, even if we are able to enroll a sufficient number of patients for our clinical trials, we may have difficulty maintaining enrollment of such patients in our clinical trials.

Changes in methods of product candidate manufacturing or formulation may result in additional costs or delay.

As product candidates proceed through preclinical studies to late-stage clinical trials towards potential approval and commercialization, it is common that various aspects of the development program, such as manufacturing methods and formulation, are altered along the way in an effort to optimize processes and product characteristics. Such changes carry the risk that they will not achieve these intended objectives. Any of these changes could cause our product candidates to perform differently and affect the results of planned clinical trials or other future clinical trials conducted with the materials manufactured

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using altered processes. Such changes may also require additional testing, FDA notification or FDA approval. This could delay completion of clinical trials, require the conduct of bridging clinical trials or the repetition of one or more clinical trials, increase clinical trial costs, delay approval of our product candidates and jeopardize our ability to commence sales and generate revenue.

Our clinical development of bentracimab depends on the continued use of ticagrelor as an antiplatelet therapy.

We are developing bentracimab as a ticagrelor reversal agent for the treatment of patients on ticagrelor with uncontrolled major or life-threatening bleeding or requiring urgent surgery or an invasive procedure. If previously unknown safety risks related to ticagrelor are discovered that would affect its use as an antiplatelet therapy, or if market acceptance of ticagrelor significantly changes, we may pause or stop development of bentracimab, which would significantly and adversely affect our business prospects.

ELP is a novel technology, which makes it difficult to predict the time, risks and cost of development and of subsequently obtaining regulatory approval of our ELP product candidates.

Pemziviptadil and certain other preclinical product candidates are based on our proprietary ELP technology. Some of our future success depends on the successful development of this technology and products based on it. To our knowledge, no regulatory authority has granted approval to any person or entity, including us, to market and commercialize therapeutics using our novel ELP technology. We may never receive approval to market and commercialize any product candidate that utilizes ELP.

If we uncover any previously unknown risks related to our ELP technology, or if we experience unanticipated problems or delays in developing our ELP product candidates, we may be unable to complete our clinical trials and preclinical studies, meet the obligations of our license agreements or commercialize our product candidates on a timely or profitable basis. If serious adverse events or unacceptable side effects are observed in clinical trials or preclinical studies of a product candidate based on our ELP technology, our ability to develop other product candidates based on our ELP technology would be adversely affected.

We may be unable to obtain or maintain orphan drug designations or exclusivity for pemziviptadil or other product candidates, which could limit the potential profitability of such product candidates.

Regulatory authorities in some jurisdictions, including the United States, designate drugs intended for relatively small patient populations as orphan drugs. Under the Orphan Drug Act, the FDA may grant orphan designation to a drug or biologic intended to treat a rare disease or condition, which is a disease or condition that affects fewer than 200,000 individuals in the United States, or more than 200,000 individuals in the United States for which there is no reasonable expectation that the cost of developing and making available in the United States a drug or biologic for this type of disease or condition will be recovered from sales in the United States for that drug or biologic. Generally, a product that has orphan drug designation and subsequently receives the first FDA approval for the disease for which it has such designation is entitled to orphan drug exclusive approval (or exclusivity), which means that the FDA may not approve any other applications, including a full 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. A designated orphan drug may not receive orphan drug exclusivity if it is approved for a use that is broader than the indication for which it received orphan designation.

The FDA has granted two orphan drug designations for pemziviptadil: one for the treatment of PAH and a second for cardiomyopathy associated with Duchenne muscular dystrophy. We may seek orphan drug designation for future indications for pemziviptadil or for other product candidates. Even if we were to obtain orphan drug designation for a product candidate, we may not obtain orphan exclusivity and that exclusivity may not effectively protect the drug from the competition of different drugs for the same condition, which could be approved during the exclusivity period. Additionally, after an orphan drug is approved, the FDA could subsequently approve another application for the same drug for the same indication if the FDA concludes that the later drug is shown to be safer or more effective or makes a major contribution to patient care. Orphan drug exclusive marketing rights in the United States also may be lost if the FDA later determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the rare disease or condition. The failure to obtain an orphan drug designation for any product candidates we may develop, the inability to maintain that designation for the duration of the applicable period, or the inability to obtain or maintain orphan drug exclusivity could reduce our ability to make sufficient sales of the applicable product candidate to balance our expenses incurred to develop it, which would have a negative impact on our operational results and financial condition.

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Breakthrough Therapy designation by the FDA and PRIME designation by the EMA for bentracimab, or any other product candidate, may not lead to a faster development or regulatory review or approval process, and it does not increase the likelihood that the product candidate will receive marketing approval.

We have received a Breakthrough Therapy designation for bentracimab for the reversal of ticagrelor's antiplatelet activity and may, in the future, apply for Breakthrough Therapy designation for other product candidates. A Breakthrough Therapy is defined as a product candidate 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 product candidate 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 product candidates 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. Product candidates 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.

Designation as a Breakthrough Therapy is within 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 product candidate may not result in a faster development process, review or approval compared to product candidates 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 qualifies as a Breakthrough Therapy, 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.

Access to the PRIME initiative is granted by the EMA to support the development and accelerate the review of new therapies to treat patients with unmet medical need. The receipt of this access for a product candidate may not result in a faster development process, review or approval compared to products considered for approval under conventional EMA procedures and, in any event, does not assure ultimate approval by the EMA. In addition, even though bentracimab has been granted access to PRIME, the EMA may later decide that it no longer meets the conditions for such access.

We may not be successful in our efforts to increase our pipeline of product candidates, including by pursuing additional indications for our current product candidates or in-licensing or acquiring additional product candidates for other diseases.

A key element of our strategy is to build and expand our pipeline of product candidates, including by developing pemziviptadil for the treatment of other orphan conditions, and PB6440 for treatment-resistant hypertension and by identifying other product candidates using our ELP technology. In addition, we may in-license or acquire additional product candidates for other diseases. We may not be able to identify or develop product candidates that are safe, tolerable and effective. Even if we are successful in continuing to build our pipeline, the potential product candidates that we identify, in-license or acquire may not be suitable for clinical development, including as a result of their being shown to have harmful side effects or other characteristics that indicate that they are unlikely to be products that will receive marketing approval and achieve market acceptance.

We may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success.

Because we have limited financial and management resources, we focus on development programs and product candidates that we identify for specific indications. As such, we are currently primarily focused on the development of bentracimab as a ticagrelor reversal agent, pemziviptadil for the treatment of PAH and PB6440 for treatment-resistant hypertension. As a result, we may forego or delay pursuit of opportunities with other product candidates or for other indications for pemziviptadil that later prove to have greater commercial potential. Our resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitable market opportunities. Our spending on current and future development programs and product candidates for specific indications may not yield any commercially viable products. If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights to that product candidate through collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous for us to retain sole development and commercialization rights to such product candidate.

The United Kingdom’s withdrawal from the European Union may adversely impact our ability to obtain regulatory approvals of our product candidates in the United Kingdom, result in restrictions or imposition of taxes and duties for importing our product candidates into the United Kingdom, and may require us to incur additional expenses in order to develop, manufacture and commercialize our product candidates in the United Kingdom.

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Following the result of a referendum in 2016, the United Kingdom left the European Union on January 31, 2020, commonly referred to as Brexit. Pursuant to the formal withdrawal arrangements agreed to by the United Kingdom and the European Union, the United Kingdom was subject to a transition period until December 31, 2020, or the Transition Period, during which EU rules continued to apply. A trade and cooperation agreement, or the Trade and Cooperation Agreement, that outlines the future and trading relationship between the United Kingdom and the European Union was agreed to in December 2020.

Since a significant proportion of the regulatory framework in the United Kingdom applicable to our business and our product candidates is derived from EU directives and regulations, Brexit has had, and will continue to have, a material impact on the regulatory regime with respect to the development, manufacture, importation, approval and commercialization of our product candidates in the United Kingdom or the European Union. For example, Great Britain is no longer covered by the centralized procedures for obtaining EU-wide marketing authorizations from the EMA, and a separate marketing authorization will be required to market our product candidates in Great Britain. It is currently unclear whether the MHRA in the United Kingdom is sufficiently prepared to handle the increased volume of marketing authorization applications that it is likely to receive. Any delay in obtaining, or an inability to obtain, any marketing approvals, as a result of Brexit or otherwise, would delay or prevent us from commercializing our product candidates in the United Kingdom and limit our ability to generate revenue in that territory. While the Trade and Cooperation Agreement provides for the tariff-free trade of medicinal products between the United Kingdom and the European Union, there may be additional non-tariff costs to such trade that did not exist prior to the end of the Transition Period. Further, should the United Kingdom diverge from the European Union from a regulatory perspective in relation to medicinal products, tariffs could be put into place in the future. We could therefore, both now and in the future, face significant additional expenses (when compared to prior to the end of the Transition Period) to operate our business, which could significantly and materially harm or delay our ability to generate revenues or achieve profitability of our business. Any further changes in international trade, tariff and import/export regulations as a result of Brexit or otherwise may impose unexpected duty costs or other non-tariff barriers on us. These developments, or the perception that any of them could occur, may significantly reduce global trade and, in particular, trade between the impacted nations and the United Kingdom.

Risks Related to the Commercialization of Our Product Candidates

Market acceptance of bentracimab, if approved, will depend heavily on the continued market acceptance and use of ticagrelor.

The commercial success of bentracimab as a ticagrelor reversal agent, if approved, is dependent on the continued market acceptance and use of ticagrelor as an antiplatelet therapy. Ticagrelor competes against other commercially available antiplatelet therapies, including other P2Y12 receptor antagonists, many of which are available as generic drugs and therefore significantly less expensive than ticagrelor. New antiplatelet therapies may also be developed in the future, including other P2Y12 receptor antagonists and other antiplatelet therapies, which could also have reversal agents, that could displace ticagrelor as the American College of Cardiology, American Heart Association and European Society of Cardiology’s preferred antiplatelet agent for acute coronary syndrome or otherwise reduce ticagrelor’s market position. Any such changes in the market acceptance and use of ticagrelor would significantly harm our business, results of operations and prospects for bentracimab.

Even if any of our product candidates receive marketing approval, they may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success.

If any of our product candidates receive marketing approval, they may nonetheless fail to gain sufficient market acceptance by physicians, patients, third-party payors and others in the medical community. If our product candidates do not achieve an adequate level of acceptance, we may not generate significant revenue and we may not become profitable. The degree of market acceptance of our product candidates, if approved for commercial sale, will depend on a number of factors, including:

•the efficacy, safety and potential advantages compared to alternative treatments;

•our ability to offer our products for sale at competitive prices;

•the convenience and ease of administration compared to alternative treatments;

•product labeling or product insert requirements of the FDA or foreign regulatory authorities, including any limitations or warnings contained in a product’s approved labeling, including any black box warning;

•the willingness of the target patient population to try new treatments and of physicians to prescribe these treatments;

•our ability to hire and retain a sales force in the United States;

•Alfasigma's ability to achieve a successful commercial launch of bentracimab in its target countries pursuant to the Alfasigma Sublicense;

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•the strength of marketing and distribution support;

•the availability of third-party coverage and adequate reimbursement for bentracimab, pemziviptadil, PB6440 and any other product candidates, once approved;

•the prevalence and severity of any side effects; and

•any restrictions on the use of our products together with other medications.

If we are unable to establish sales, marketing and distribution capabilities for bentracimab, pemziviptadil, PB6440 or any other product candidate that may receive regulatory approval, we may not be successful in commercializing those product candidates if and when they are approved.

We do not have sales or marketing infrastructure. To achieve commercial success for bentracimab, pemziviptadil, PB6440 or any other product candidate for which we may obtain marketing approval, we will need to establish a sales and marketing organization or identify a commercialization partner. In the future, we expect to build a focused sales and marketing infrastructure to market some of our product candidates in the United States, if and when they are approved. There are risks involved with establishing our own sales, marketing and distribution capabilities. For example, recruiting and training a sales force is expensive and time consuming and could delay any product launch. If the commercial launch of a product candidate for which we recruit a sales force and establish marketing capabilities is delayed or does not occur for any reason, we would have prematurely or unnecessarily incurred these commercialization expenses. This may be costly, and our investment would be lost if we cannot retain or reposition our sales and marketing personnel.

Factors that may inhibit our efforts to market our products on our own include:

•our inability to recruit, train and retain adequate numbers of effective sales and marketing personnel;

•the inability of sales personnel to obtain access to physicians in order to educate physicians about our product candidates, once approved;

•the lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage relative to companies with more extensive product lines; and

•unforeseen costs and expenses associated with creating an independent sales and marketing organization.

Pursuant to the Alfasigma Sublicense, we granted to Alfasigma exclusive rights to develop, use, sell, have sold, offer for sale and import any product composed of or containing bentracimab in the Sublicense Territory. If we are unable to establish our own sales, marketing and distribution capabilities in other countries or regions and are forced to enter into arrangements with, and rely on, other third parties to perform these services, our revenue and our profitability, if any, are likely to be lower than if we had developed such capabilities ourselves. In addition, we may not be successful in entering into additional arrangements with third parties to sell, market and distribute our product candidates or may be unable to do so on terms that are favorable to us. We likely will have little control over such third parties, and any of them may fail to devote the necessary resources and attention to sell and market our products effectively. If we do not establish sales, marketing and distribution capabilities successfully, either on our own or in collaboration with additional third parties, we will not be successful in commercializing our product candidates.

We face substantial competition, which may result in a smaller than expected commercial opportunity and/or others discovering, developing or commercializing products before or more successfully than we do.

The life sciences industry is highly competitive. We face competition with respect to our current product candidates, and will face competition with respect to any product candidates that we may seek to develop or commercialize in the future, from many different sources, including major pharmaceutical and specialty pharmaceutical companies, compounding facilities, academic institutions and governmental agencies and public and private research institutions.

There are currently no other known reversal agents approved or in clinical development for ticagrelor or any other antiplatelet drugs. In the European Union, an extracorporeal whole blood purification adsorber device is available that may be useful for non-specific removal of ticagrelor during some cardiac procedures when used in conjunction with cardiopulmonary bypass. Upon approval, bentracimab would be the only therapeutic agent available for specific reversal of ticagrelor. There can be no assurance that competitors will not seek to develop a competing product. Moreover, the success of bentracimab, if approved, will be dependent on the continued success of ticagrelor. See “—Market acceptance of bentracimab, if approved, will depend heavily on the continued market acceptance and use of ticagrelor.”

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We are aware of several other products and product candidates as potential treatments for PAH that would compete with pemziviptadil. Although we anticipate that pemziviptadil may be used as a complement to patients’ existing therapies, we expect to compete with existing treatments for PAH patients with Class II-IV symptoms that target the endothelin, nitric oxide and prostacyclin pathways, as well as any generic equivalents that may be developed. In addition to currently approved drugs within these classes, we are also aware of a number of PAH therapies in clinical development with which pemziviptadil would compete if approved.

In addition, we are aware of several other products and product candidates as potential treatments for treatment-resistant hypertension that could compete with PB6440. Although we anticipate that PB6440 may be used as a complement to patients’ existing antihypertensive therapies, we expect to compete with existing generic treatments for hypertension that target the mineralocorticoid receptor. In addition to the currently approved mineralocorticoid receptor antagonists, eplerenone and spironolactone, we are also aware of a number of therapies in clinical development for the treatment of resistant hypertension with which PB6440 would compete if approved, including CIN-107, an aldosterone synthase inhibitor currently being evaluated by CinCor Pharma, Inc. in a Phase 2 clinical trial and MLS-101, an aldosterone synthase inhibitor being studied by Mineralys Therapeutics, which is in Phase 2 development.

In addition, our commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer or more effective, have fewer or less severe side effects, are more convenient or are less expensive than bentracimab, pemziviptadil, PB6440 or any other product that we may develop. Our competitors also may obtain FDA or other regulatory approval for their products more rapidly than we may obtain approval for our product, which could result in our competitors establishing a strong market position before we are able to enter the market.

Many of the companies against which we are competing, or against which we may compete in the future, have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting clinical trials, obtaining regulatory approvals and marketing approved products than we do. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or that may be necessary for, our programs.

The success of bentracimab as a ticagrelor reversal agent, pemziviptadil for the treatment of PAH, PB6440 for treatment-resistant hypertension or any future product candidate will depend significantly on coverage and adequate reimbursement or the willingness of patients to pay for these procedures.

We believe our success depends on obtaining and maintaining coverage and adequate reimbursement for bentracimab as a ticagrelor reversal agent, pemziviptadil for the treatment of PAH, PB6440 for treatment-resistant hypertension and/or procedures utilizing bentracimab, pemziviptadil, PB6440 or any other product candidate, and the extent to which patients will be willing to pay out-of-pocket for such products and procedures, in the absence of reimbursement for all or part of the cost. Obtaining coverage and adequate reimbursement for our products may be particularly difficult because of the higher prices often associated with drugs administered under the supervision of a physician. Separate reimbursement for the product itself or the treatment or procedure in which our product is used may not be available. Even if the procedure using our product is covered, third-party payors, such as Medicare, Medicaid, managed care organizations, and private health insurers, may package the cost of the drug into the procedure payment and not separately reimburse the physician for the costs associated with our product. A decision by a third-party payor not to cover or separately reimburse for our products could reduce physician utilization of our products once approved. Additionally, in the United States, there is no uniform policy of coverage and reimbursement among third-party payors. Third-party payors often rely upon Medicare coverage policy and payment limitations in setting their own coverage and reimbursement policies. However, decisions regarding the extent of coverage and amount of reimbursement to be provided are made on a payor-by-payor basis. One payor’s determination to provide coverage for a drug product does not assure that other payors will also provide coverage, and adequate reimbursement.

Third-party payors determine which products and procedures they will cover and establish reimbursement levels. Even if a third-party payor covers a particular product or procedure, the resulting reimbursement payment rates may not be adequate. Patients who are treated in-office for a medical condition generally rely on third-party payors to reimburse all or part of the costs associated with the procedure, including costs associated with products used during the procedure, and may be unwilling to undergo such procedures in the absence of such coverage and adequate reimbursement. Physicians may be unlikely to offer procedures for such treatment if they are not covered by insurance and may be unlikely to purchase and use our product candidates, if approved, for our stated indications unless coverage is provided and reimbursement is adequate.

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Reimbursement by a third-party payor may depend upon a number of factors, including the third-party payor’s determination that a procedure is safe, effective and medically necessary; appropriate for the specific patient; cost-effective; supported by peer-reviewed medical journals; included in clinical practice guidelines; and neither cosmetic, experimental, nor investigational.

Further, from time to time, typically on an annual basis, payment rates are updated and revised by third-party payors. An example of payment rate updates occurs in the Medicare program updates to physician payments, which is done on an annual basis. In the past, when the application of the formula resulted in lower payment, Congress has passed interim legislation to prevent the reductions. The Medicare Access and CHIP Reauthorization Act of 2015, or MACRA, ended the use of the statutory formula and introduced a merit-based incentive bonus program for Medicare physicians, also referred to as the Quality Payment Program. This program provides clinicians with two ways to participate, including through the Advanced Alternative Payment Models and the Merit-based Incentive Payment System. In November 2019, the Centers for Medicare & Medicaid Services, or CMS, issued a rule finalizing the changes to the Quality Payment Program. The full impact to overall physician reimbursement as a result of the introduction of the Quality Payment Program remains unclear. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors. Any resulting decrease in payment under the merit-based reimbursement system may adversely affect our revenue and results of operations. In addition, the Medicare physician fee schedule has been adapted by some private payors into their plan-specific physician payment schedule. We cannot predict how pending and future healthcare legislation will impact our business, and any changes in coverage and reimbursement that further restricts coverage of our product candidates or lowers reimbursement for procedures using our products could harm our business.

Foreign governments also have their own healthcare reimbursement systems, which vary significantly by country and region, and we cannot be sure that coverage and adequate reimbursement will be made available with respect to the treatments in which our products are used under any foreign reimbursement system.

There can be no assurance that bentracimab, pemziviptadil, PB6440 or any other product candidate, if approved for sale in the United States or in other countries, will be considered medically reasonable and necessary, that it will be considered cost-effective by third-party payors, that coverage or an adequate level of reimbursement will be available or that reimbursement policies and practices in the United States and in foreign countries where our products are sold will not adversely affect our ability to sell our product candidates profitably, if they are approved for sale.

The market for bentracimab, pemziviptadil, PB6440 or any other product candidates may be smaller than we expect.

Our estimates of the potential market opportunity for bentracimab, pemziviptadil, PB6440 or any other product candidates include several key assumptions based on our industry knowledge, industry publications and third-party research reports. These assumptions include, for bentracimab, the number of patients on ticagrelor who will experience uncontrolled major or life-threatening bleeding or who will require urgent surgery or an invasive procedure; for pemziviptadil, the number of patients with PAH; and for PB6440, the number of patients with treatment-resistant hypertension, as well as the estimated reimbursement levels for each product candidate if approved. However, there can be no assurance that any of these assumptions are, or will remain, accurate. If the actual market for bentracimab, pemziviptadil, PB6440 or for any other product candidates we may develop is smaller than we expect, our revenues, if any, may be limited and it may be more difficult for us to achieve or maintain profitability.

Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop.

We face an inherent risk of product liability exposure related to the testing of our product candidates in human clinical trials and will face an even greater risk if we commercially sell any products that we may develop. If we cannot successfully defend ourselves against claims that our product candidates or drugs caused injuries, we will incur substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in:

•decreased demand for any product candidates or drugs that we may develop;

•injury to our reputation and significant negative media attention;

•withdrawal of clinical trial participants;

•significant costs to defend the related litigation;

•substantial monetary awards paid to trial participants or patients;

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•loss of revenue;

•reduced resources of our management to pursue our business strategy; and

•the inability to commercialize any products that we may develop.

We currently hold $10,000,000 in product liability insurance coverage in the aggregate, with a per incident limit of $10,000,000, which may not be adequate to cover all liabilities that we may incur. We may need to increase our insurance coverage as we expand our clinical trials or if we commence commercialization of our product candidates. Insurance coverage is increasingly expensive. We may not be able to maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise.

Risks Related to Our Dependence on Third Parties

We rely on third parties to conduct a significant portion of our existing clinical trials and potential future clinical trials for product candidates, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials.

To date, we have generally engaged CROs to conduct or assist in our ongoing clinical trials of bentracimab and pemziviptadil. We expect to engage CROs for future clinical trials for bentracimab, pemziviptadil, PB6440 or other product candidates that we may progress to clinical development. In addition, pursuant to the SFJ Agreement, SFJ will have primary responsibility for clinical development and regulatory activities for bentracimab in China and Japan and will provide clinical trials operational support in the European Union. We expect to continue to rely on third parties, including clinical data management organizations, medical institutions and clinical investigators, to conduct these clinical trials. Any of these third parties may terminate their engagements with us, some in the event of an uncured material breach and some at any time for convenience. If any of our relationships with these third parties terminate, we may not be able to timely enter into arrangements with alternative third parties or to do so on commercially reasonable terms, if at all. Switching or adding CROs involves substantial cost and requires management time and focus. In addition, there is a natural transition period when a new CRO commences work. As a result, delays occur, which can materially impact our ability to meet our desired clinical development timelines. Though we intend to carefully manage our relationships with our CROs, there can be no assurance that we will not encounter challenges or delays in the future or that these delays or challenges will not have a material adverse impact on our business, financial condition and prospects. Further, the performance of our CROs may also be interrupted by the ongoing COVID-19 pandemic, including due to travel or quarantine policies, heightened exposure of CRO staff who are healthcare providers to COVID-19 or prioritization of resources toward the pandemic.

In addition, any third parties conducting our clinical trials will not be our employees, and except for remedies available to us under our agreements with such third parties, we cannot control whether or not they devote sufficient time and resources to our clinical programs. If these third parties do not successfully carry out their contractual duties or obligations or meet expected deadlines, if they need to be replaced or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols, regulatory requirements or for other reasons, our clinical trials may be extended, delayed or terminated and we may not be able to obtain regulatory approval for or successfully commercialize our product candidates. Consequently, our results of operations and the commercial prospects for our product candidates would be harmed, our costs could increase substantially and our ability to generate revenue could be delayed significantly.

We rely on these parties for execution of our preclinical studies and clinical trials, and generally do not control their 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 responsibilities. For example, we will remain 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 standards, commonly referred to as good clinical practices, or GCPs, 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 also are required to register ongoing clinical trials and post the results of completed clinical trials on a government-sponsored database, ClinicalTrials.gov, within specified timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions. If we or any of our CROs or other third parties, including trial sites, fail to comply with applicable GCPs, the clinical data generated in our clinical trials may be deemed unreliable and the FDA, EMA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving our marketing applications. We cannot assure you that upon inspection by a given regulatory authority, such regulatory authority will determine that any of our clinical trials complies with GCP regulations. In addition, our clinical trials must be conducted with product produced under cGMP conditions. Our failure to comply with these regulations may require us to repeat clinical trials, which would delay the regulatory approval process.

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In addition, principal investigators for our clinical trials may serve as scientific advisors or consultants to us from time to time and receive compensation in connection with such services. Under certain circumstances, we may be required to report some of these relationships to the FDA. The FDA may conclude that a financial relationship between us and a principal investigator has created a conflict of interest or otherwise affected interpretation of the trial. The FDA may therefore question the integrity of the data generated at the applicable clinical trial site and the utility of the clinical trial itself may be jeopardized. This could result in a delay in approval, or rejection, of our marketing applications by the FDA and may ultimately lead to the denial of marketing approval of bentracimab, pemziviptadil, PB6440 or any other product candidates.

We also expect to rely on other third parties to store and distribute product supplies for our clinical trials. Any performance failure on the part of our distributors could delay clinical development or marketing approval of our product candidates or commercialization of our products, producing additional losses and depriving us of potential revenue.

We currently rely, and expect to continue to rely, on third parties for the cGMP manufacture of bentracimab, pemziviptadil, PB6440 and any other product candidates that we may pursue, for clinical development as well as for commercial manufacturing, if we receive marketing approval. This reliance on third parties increases the risk that we will not have sufficient quantities of our product candidates or such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.

We do not have any cGMP manufacturing facilities. We currently rely, and expect to continue to rely, on third parties for the cGMP manufacture of bentracimab, pemziviptadil, PB6440 and any other product candidates that we may pursue, for clinical development as well as for commercial manufacture of bentracimab, pemziviptadil, PB6440 and any other product candidates which we may pursue, if we receive marketing approval. We also rely on a proprietary E. coli strain owned by Wacker, which we have licensed for the production of bentracimab. Our reliance on Wacker’s E. coli strain increases the risk that we will not have sufficient quantities of bentracimab or be able to obtain quantities at an acceptable cost or quality, which could delay, prevent or impair our ability to timely conduct our clinical trials or our other development or commercialization efforts.

With respect to bentracimab, to date we have only relied upon Wacker for manufacture of drug substance for use in our initial clinical trials. As we scale our manufacturing of bentracimab to meet potential commercial demand, if bentracimab is approved, we have initiated a technology transfer of our current manufacturing process for bentracimab to BioVectra Inc., or BioVectra, another cGMP contract manufacturer. We have engaged BioVectra to manufacture drug substance for our ongoing clinical trials and recently engaged BioVectra to manufacture commercial supply of bentracimab, if approved. We will need to perform analytical and other tests to demonstrate that the new materials produced by Wacker, BioVectra, or any other future third-party manufacturer that we engage, are comparable in all respects to the product utilized in our previous clinical trials. There is no assurance that any such product will pass the required comparability testing in a timely manner, or at all, that any other future third-party manufacturer that we engage will be successful in producing bentracimab or that any materials produced by Wacker, BioVectra or any other third-party manufacturer that we engage will have the same effect in patients that we have observed to date with respect to materials used in our previous clinical trials. Moreover, if supplies are interrupted or produced in poor yield or quality, it would materially harm our business. BioVectra will be required to scale up the manufacturing process to meet our future needs of bentracimab for later-stage clinical development and, if approved, commercialization. If BioVectra is unable to successfully scale up the manufacturing process, we would need to find alternative manufacturing facilities or an alternative manufacturing process, which we may not be able to do on a timely basis or on commercially reasonable terms, if at all, and which could adversely affect the clinical development of bentracimab.

We also expect to rely on third-party manufacturers or third-party collaborators for the manufacture of commercial supply of bentracimab, pemziviptadil, PB6440 and any other product candidates for which we obtain marketing approval. The facilities used by our contract manufacturers to manufacture our product candidates must be inspected by the FDA or other regulatory authorities after we submit our BLA or comparable marketing application to the FDA or other regulatory authority. We do not have control over a supplier’s or manufacturer’s compliance with laws, regulations and applicable cGMP standards or similar regulatory requirements and other laws and regulations, such as those related to environmental health and safety matters. If our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of the FDA or other regulatory authorities, we may be unable to obtain regulatory approval of our marketing applications. In addition, we have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified personnel. If the FDA or a comparable foreign regulatory authority finds deficiencies with or does not approve these facilities for the manufacture of our product candidates or if it withdraws any such approval in the future, we may need to find alternative manufacturing facilities, which would significantly impact our ability to develop, obtain regulatory approval for or market our product candidates, if approved.

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We may be unable to enter into any agreements with future third-party manufacturers or to do so on acceptable terms. Even if we enter into such agreements, qualifying and validating such manufacturers may take a significant period of time and reliance on third-party manufacturers entails additional risks, including:

•reliance on the third party for regulatory compliance and quality assurance;

•the possible breach of the manufacturing agreement by the third party;

•the incurrence of upfront scale-up costs prior to commercial approval;

•the possible misappropriation of our proprietary information, including our trade secrets and know-how;

•the possible increase in costs for the raw materials for our product candidates; and

•the possible termination or nonrenewal of any agreement by any third party at a time that is costly or inconvenient for us.

Our failure, or the failure of our third-party manufacturers, to comply with applicable regulations could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of product candidates or drugs, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supply of our products.

Our product candidates, and any drugs that we may develop, may compete with other product candidates and drugs for access to manufacturing facilities. The performance of our third-party manufacturers have been and may in the future be interrupted by production shortages or other supply interruptions resulting from the ongoing COVID-19 pandemic. There are no assurances we would be able to enter into similar commercial arrangements with other manufacturers that operate under cGMP regulations and that might be capable of manufacturing for us in a timely manner. Any performance failure on the part of our existing or future manufacturers could delay clinical development or marketing approval.

We are collaborating with SFJ for the development of bentracimab and with Alfasigma for the commercialization of bentracimab in Europe and certain other geographic areas, and we may seek additional collaborations with third parties for the development or commercialization of our product candidates. If those collaborations are not successful, we may not be able to capitalize on the market potential of these product candidates.

We are collaborating with SFJ for the development of bentracimab and with Alfasigma for the commercialization of bentracimab in Europe and certain other geographic regions. We may seek additional third-party collaborators for the development and commercialization of our product candidates, including for the commercialization of any of our product candidates that are approved for marketing outside the United States. Our likely collaborators for any such arrangements include regional and national pharmaceutical companies and biotechnology companies. If we enter into any additional such arrangements with any third parties, we will likely have limited control over the amount and timing of resources that our collaborators dedicate to the development or commercialization of our product candidates. Our ability to generate revenue from these arrangements will depend on our collaborators’ abilities to successfully perform the functions assigned to them in these arrangements.

Collaborations involving our product candidates would pose the following risks to us:

•collaborators have significant discretion in determining the efforts and resources that they will apply to these collaborations;

•collaborators may not perform their obligations as expected;

•collaborators may not pursue development and commercialization of any product candidates that achieve regulatory approval or may elect not to continue or renew development or commercialization programs based on clinical trial results, changes in the collaborators’ strategic focus or available funding, or external factors, such as an acquisition, that divert resources or create competing priorities;

•collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;

•to the extent they are not otherwise prohibited in our agreements with them, 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;

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•product candidates discovered in collaboration with us may be viewed by our collaborators as competitive with their own product candidates or drugs, which may cause collaborators to cease to devote resources to the 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 such products;

•disagreements with collaborators, including disagreements over proprietary rights, contract interpretation or the preferred course of development, might cause delays or termination of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive;

•collaborators may not properly maintain or defend our or their intellectual property rights or may use our or their proprietary information in such a way as to invite litigation that could jeopardize or invalidate such intellectual property or proprietary information or expose us to potential litigation;

•collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability; and

•collaborations may be terminated for the convenience of the collaborator and, if terminated, we could be required to raise additional capital to pursue further development or commercialization of the applicable product candidates.

Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner or at all. If SFJ, Alfasigma or any future collaborator of ours were to be involved in a business combination, the continued pursuit and emphasis on our product development or commercialization program could be delayed, diminished or terminated.

We may seek to establish additional collaborations, and if we are unable to do so, we may have to alter our development and commercialization plans.

Our product development programs and the potential commercialization of our product candidates will require substantial additional capital. We are collaborating with SFJ for the development of bentracimab and with Alfasigma for the commercialization of bentracimab in Europe and certain other geographic regions. For our other product candidates, we may decide to establish additional collaborations with pharmaceutical and biotechnology companies for the development and potential commercialization of those product candidates.

We face significant competition in seeking appropriate collaborators. Whether we reach a definitive agreement for any 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 the design or results of clinical trials, the likelihood of approval by the FDA or similar 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, the existence of uncertainty with respect to our ownership of technology, which can exist if there is a challenge to such ownership without regard to the merits of the challenge and industry and market conditions generally. The collaborator 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 for our product candidate. Collaborations are complex and time-consuming to negotiate and document. 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.

We may not be able to negotiate additional collaborations on a timely basis, on acceptable terms, or at all. If we are unable to do so, we may have to curtail the development of such product candidate, reduce or delay its development program or one or more of our other development programs, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense. If we elect to increase our expenditures to fund 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. If we do not have sufficient funds, we may not be able to further develop our product candidates or bring them to market and generate revenue.

Risks Related to Our Intellectual Property

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If we are unable to obtain or protect intellectual property rights related to any of our product candidates, we may not be able to compete effectively in our market.

We rely upon a combination of patents, trade secret protection and confidentiality agreements to protect the intellectual property related to our product candidates and our ELP technology. Our success depends in large part on our ability to obtain and maintain patent and other intellectual property protection in the United States and in other countries with respect to our proprietary technology and product candidates.

As of the date of this Quarterly Report on Form 10-Q, our patent estate contained at least 23 patent families that we own or in-license that protect various aspects of our product candidates or our ELP technology platform. We own or have rights in 26 United States patents, 13 United States patent applications, 124 foreign patents and 71 foreign patent applications. We cannot offer any assurances about which of our patent applications will issue, the breadth of any resulting patent or whether any of the issued patents will be found invalid and unenforceable or will be threatened by third parties. We cannot offer any assurances that the breadth of our granted patents will be sufficient to stop a competitor from developing and commercializing a product, including a biosimilar product that would be competitive with one or more of our product candidates. Furthermore, any successful challenge to these patents or any other patents owned by or licensed to us after patent issuance could deprive us of rights necessary for the successful commercialization of any of our product candidates. Further, if we encounter delays in regulatory approvals, the period of time during which we could market a product candidate under patent protection could be reduced.

The patent prosecution process is expensive and time-consuming. We may not be able to prepare, file and prosecute all necessary or desirable patent applications at a commercially reasonable cost or in a timely manner or in all jurisdictions. It is also possible that we may fail to identify patentable aspects of inventions made in the course of development and commercialization activities before it is too late to obtain patent protection on them. Moreover, depending on the terms of any future in-licenses to which we may become a party, we may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the patents, covering technology in-licensed from third parties. Therefore, these patents and patent applications may not be prosecuted and enforced in a manner consistent with the best interests of our business.

In addition to the protection provided by our patent estate, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not amenable to patent protection. Although we generally require all of our employees to assign their inventions to us, and all of our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information, or technology to enter into confidentiality agreements, we cannot provide any assurances that all such agreements have been duly executed, or that our trade secrets and other confidential proprietary information will not be disclosed. Moreover, our competitors may independently develop knowledge, methods and know-how equivalent to our trade secrets. Competitors could purchase our products, if approved, and replicate some or all of the competitive advantages we derive from our development efforts for technologies on which we do not have patent protection. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent them, or those to whom they communicate it, from using that technology or information to compete with us. If any of our trade secrets were to be disclosed to or independently developed by a competitor, our competitive position would be harmed.

We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems. While we have confidence in these individuals, organizations and systems, our agreements or security measures may be breached, and we may not have adequate remedies for any breach. Also, if the steps taken to maintain our trade secrets are deemed inadequate, we may have insufficient recourse against third parties for misappropriating the trade secret. In addition, others may independently discover our trade secrets and proprietary information. For example, the FDA is considering whether to make additional information publicly available on a routine basis, including information that we may consider to be trade secrets or other proprietary information, and it is not clear at the present time how the FDA’s disclosure policies may change in the future. If we are unable to prevent material disclosure of the non-patented intellectual property related to our technologies to third parties, and there is no guarantee that we will have any such enforceable trade secret protection, we may not be able to establish or maintain a competitive advantage in our market, which could materially adversely affect our business, results of operations and financial condition.

Patent terms may be inadequate to protect our competitive position on our products for an adequate amount of time, and if we do not obtain protection under the Hatch-Waxman Amendments and similar non-United States legislation for extending the term of patents covering each of our product candidates, our business may be materially harmed.

Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. Depending upon the timing, duration and conditions of FDA marketing approval of our product candidates, one or more of our United States patents may be eligible for limited patent term extension under the Drug Price Competition and Patent Term Restoration Act of 1984,

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referred to as the Hatch-Waxman Amendments, and similar legislation in the European Union. The Hatch-Waxman Amendments permit a patent term extension of up to five years for a patent covering an approved product as compensation for effective patent term lost during product development and the FDA regulatory review process. 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 receive an extension if we fail to apply within applicable deadlines, fail to apply prior to expiration of relevant patents or otherwise fail to satisfy applicable requirements. Moreover, the length of the extension 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, the period during which we can enforce our patent rights for that product will be shortened and our competitors may obtain approval to market competing products sooner. As a result, our revenue from applicable products could be reduced and could have a material adverse effect on our business.

If we fail to comply with our obligations in our current and future intellectual property licenses with third parties, including the SFJ Agreement and the Alfasigma Sublicense, we could lose rights that are important to our business.

We are heavily reliant upon licenses to certain patent rights and proprietary technology for the development of bentracimab, pemziviptadil and our ELP technology. These license agreements impose diligence, development and commercialization timelines and milestone payments, royalties, insurance and other obligations on us. If we fail to comply with our obligations, our licensors may have the right to terminate our licenses, in which event we might not be able to develop, manufacture or market any product that is covered by the intellectual property we in-license from such licensor and may face other penalties. Such an occurrence would materially adversely affect our business prospects.

Licenses to additional third-party technology and materials that may be required for our development programs may not be available in the future or may not be available on commercially reasonable terms, or at all, which could have a material adverse effect on our business and financial condition. Although we control the prosecution, maintenance and enforcement of the licensed and sublicensed intellectual property relating to bentracimab, we may require the cooperation of our licensors and any upstream licensor, which may not be forthcoming. Therefore, we cannot be certain that the prosecution, maintenance and enforcement of these patent rights will be in a manner consistent with the best interests of our business. If we or our licensor fail to maintain such patents, or if we or our licensor lose rights to those patents or patent applications, the rights we have licensed may be reduced or eliminated and our right to develop and commercialize any of our product candidates that are the subject of such licensed rights could be adversely affected. In addition to the foregoing, the risks associated with patent rights that we license from third parties will also apply to patent rights we may own in the future. Further, if we fail to comply with our development obligations under our license agreements, we may lose our patent rights with respect to such agreement on a territory-by-territory basis, which would affect our patent rights worldwide.

Termination of our current or any future license agreements would reduce or eliminate our rights under these agreements and may result in our having to negotiate new or reinstated agreements with less favorable terms or cause us to lose our rights under these agreements, including our rights to important intellectual property or technology. Any of the foregoing could prevent us from commercializing our other product candidates, which could have a material adverse effect on our operating results and overall financial condition.

In addition, intellectual property rights that we in-license in the future may be sublicenses under intellectual property owned by third parties, in some cases through multiple tiers. The actions of our licensors may therefore affect our rights to use our sublicensed intellectual property, even if we are in compliance with all of the obligations under our license agreements. Should our licensors or any of the upstream licensors fail to comply with their obligations under the agreements pursuant to which they obtain the rights that are sublicensed to us, or should such agreements be terminated or amended, our ability to develop and commercialize our product candidates may be materially harmed.

Further, we have granted SFJ a security interest in all of our assets related to bentracimab, pursuant to the SFJ Agreement. If we are unable to meet our payment obligations to SFJ, SFJ may exercise its remedies as a holder of a first priority security interest, which would result in a loss of our bentracimab intellectual property rights and our business would be materially harmed.

Additionally, in connection with the Alfasigma Sublicense, in June 2021 we and Alfasigma entered into an Acknowledgement of Grant of Sublicense with MedImmune, which provides for, among other things, a potential assignment of the Alfasigma Sublicense from us to MedImmune or a potential assignment of the Medimmune License from us to Alfasigma, in either case in the event that we breach certain obligations under the Medimmune License that are not cured or remedied and SFJ

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has grounds to execute a “Program Transfer” (as defined in the SFJ Agreement) but elects not to do so, which could result in a loss of our bentracimab intellectual property rights and related revenue streams and our business would be materially harmed.

Patent reform legislation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our future patents.

Our ability to obtain patents is highly uncertain because, to date, some legal principles remain unresolved, and there has not been a consistent policy regarding the breadth or interpretation of claims allowed in patents in the United States. Furthermore, the specific content of patents and patent applications that are necessary to support and interpret patent claims is highly uncertain due to the complex nature of the relevant legal, scientific, and factual issues. Changes in either patent laws or interpretations of patent laws in the United States and other countries may diminish the value of our intellectual property or narrow the scope of our patent protection.

For example, on September 16, 2011, the Leahy-Smith America Invents Act, or the Leahy-Smith Act, was signed into law. The Leahy-Smith Act included a number of significant changes to United States patent law. These included provisions that affect the way patent applications will be prosecuted and may also affect patent litigation. The United States Patent and Trademark Office, or USPTO, has developed new and untested regulations and procedures to govern the full implementation of the Leahy-Smith Act, and many of the substantive changes to patent law associated with the Leahy-Smith Act, and in particular, the first to file provisions, became effective in March 2013. The Leahy-Smith Act has also introduced procedures making it easier for third parties to challenge issued patents, as well as to intervene in the prosecution of patent applications. Finally, the Leahy-Smith Act contained new statutory provisions that require the USPTO to issue new regulations for their implementation, and it may take the courts years to interpret the provisions of the new statute. It is too early to tell what, if any, impact the Leahy-Smith Act will have on the operation of our business and the protection and enforcement of our intellectual property. However, the Leahy-Smith Act and its implementation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our future patents. Further, the United States Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening 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 actions by the United States Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce patents that we have owned or licensed or that we might obtain in the future. An inability to obtain, enforce, and defend patents covering our proprietary technologies would materially and adversely affect our business prospects and financial condition.

Similarly, changes in patent laws and regulations in other countries or jurisdictions, changes in the governmental bodies that enforce them or changes in how the relevant governmental authority enforces patent laws or regulations may weaken our ability to obtain new patents or to enforce patents that we may obtain in the future. Further, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States. As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. For example, if the issuance in a given country of a patent covering an invention is not followed by the issuance in other countries of patents covering the same invention, or if any judicial interpretation of the validity, enforceability or scope of the claims or the written description or enablement, in a patent issued in one country is not similar to the interpretation given to the corresponding patent issued in another country, our ability to protect our intellectual property in those countries may be limited. Changes in either patent laws or in interpretations of patent laws in the United States and other countries may materially diminish the value of our intellectual property or narrow the scope of our patent protection.

We may be involved in lawsuits to protect or enforce our patents, which could be expensive, time consuming and unsuccessful.

Competitors may infringe the patents we have applied for. To counter infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time-consuming. If we initiate legal proceedings against a third party to enforce a patent covering one of our product candidates, the defendant could counterclaim that the patent covering our product or product candidate is invalid and/or unenforceable. In patent litigation in the United States, counterclaims alleging invalidity and/or unenforceability are common, and there are numerous grounds upon which a third party can assert invalidity or unenforceability of a patent. In an infringement proceeding, a court may decide that the patent claims we are asserting are invalid and/or unenforceable, or may refuse to stop the other party from using the technology at issue on the grounds that our patent claims do not cover the technology in question. Third parties may also raise similar claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include re-examination, post grant review, inter partes review and equivalent proceedings in foreign jurisdictions (for example, opposition proceedings). Such proceedings could result in revocation of or amendment to our patents in such a way that they no longer cover our product candidates. The outcome

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following legal assertions of invalidity and unenforceability is unpredictable. With respect to the validity question, for example, we cannot be certain that there is no invalidating prior art of which we, our patent counsel, and the patent examiner were unaware during prosecution. If a defendant were to prevail on a legal assertion of invalidity and/or unenforceability, we would lose at least part, and perhaps all, of the patent protection on our product candidates. An adverse result in any litigation or defense proceedings could put one or more of our patents at risk of being invalidated or interpreted narrowly, could put our patent applications at risk of not issuing and could have a material adverse impact on our business.

Interference proceedings provoked by third parties or brought by us may be necessary to determine the priority of inventions with respect to our patent applications. An unfavorable outcome could require us to cease using the related technology or force us to take a license under the patent rights of the prevailing party, if available. Furthermore, our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms. Our defense of litigation or interference proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees. We may not be able to prevent misappropriation of our intellectual property rights, particularly in countries where the laws may not protect those rights as fully as in the United States.

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. If securities analysts or investors perceive these results to be negative, it could have a material adverse effect on the price of our common stock.

We may be unsuccessful in licensing or acquiring intellectual property from third parties that may be required to develop and commercialize our product candidates.

A third party may hold intellectual property, including patent rights that are important or necessary to the development and commercialization of our product candidates. It may be necessary for us to use the patented or proprietary technology of third parties to commercialize our product candidates, in which case we would be required to acquire or obtain a license to such intellectual property from these third parties, and we may be unable to do so on commercially reasonable terms or at all. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue 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, capital resources and greater clinical development and commercialization capabilities. In addition, companies 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 or at all. If we are unable to successfully obtain rights to required third-party intellectual property rights or maintain the existing intellectual property rights we have, we may have to abandon development of the relevant program or product candidate, which could have a material adverse effect on our business.

Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights, the outcome of which would be uncertain.

As our current and future product candidates progress toward commercialization, the possibility of a patent infringement claim against us increases. We cannot provide any assurance that our current and future product candidates do not infringe other parties’ patents or other proprietary rights, and competitors or other parties may assert that we infringe their proprietary rights in any event. We may become party to, or threatened with, adversarial proceedings or litigation regarding intellectual property rights with respect to our current and future product candidates, including interference or derivation proceedings before the USPTO. Even if we believe such claims are without merit, a court of competent jurisdiction could hold that these third-party patents are valid, enforceable and infringed, which could have a negative impact on our ability to commercialize bentracimab, pemziviptadil, PB6440 or any future product candidates. In order to successfully challenge the validity of any such United States patent in federal court, we would need to overcome a presumption of validity. As this burden is high and requires us to present clear and convincing evidence as to the invalidity of any such United States patent claim, there is no assurance that a court of competent jurisdiction would agree with us and invalidate the claims of any such United States patent. Moreover, given the vast number of patents in our field of technology, we cannot be certain that we do not infringe existing patents or that we will not infringe patents that may be granted in the future.

While we may decide to initiate proceedings to challenge the validity of these or other patents in the future, we may be unsuccessful, and courts or patent offices in the United States and abroad could uphold the validity of any such patent. Furthermore, because patent applications can take many years to issue and may be confidential for 18 months or more after filing, and because pending patent claims can be revised before issuance, there may be applications now pending which may later result

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in issued patents that may be infringed by the manufacture, use or sale of our product candidates. Regardless of when filed, we may fail to identify relevant third-party patents or patent applications, or we may incorrectly conclude that a third-party patent is invalid or not infringed by our product candidates or activities. If a patent holder believes that one of our product candidates infringes its patent, the patent holder may sue us even if we have received patent protection for our technology. Moreover, we may face patent infringement claims from non-practicing entities that have no relevant drug revenue and against whom our own patent portfolio may thus have no deterrent effect. If a patent infringement suit were threatened or brought against us, we could be forced to stop or delay research, development, manufacturing or sales of the drug or product candidate that is the subject of the actual or threatened suit.

If we are found to infringe a third party’s intellectual property rights, we could be required to obtain a license from such third party to continue commercializing our product candidates. However, we may not be able to obtain any required license on commercially reasonable terms or at all. Even if a license can be obtained on acceptable terms, the rights may be non-exclusive, which could give our competitors access to the same technology or intellectual property rights licensed to us. If we fail to obtain a required license, we may be unable to effectively market product candidates based on our technology, which could limit our ability to generate revenue or achieve profitability and possibly prevent us from generating revenue sufficient to sustain our operations. Alternatively, we may need to redesign our infringing products, which may be impossible or require substantial time and monetary expenditure. Under certain circumstances, we could be forced, including by court orders, to cease commercializing our product candidates. In addition, in any such proceeding or litigation, we could be found liable for substantial monetary damages, potentially including treble damages and attorneys’ fees, if we are found to have willfully infringed the patent at issue. A finding of infringement could prevent us from commercializing our product candidates or force us to cease some of our business operations, which could harm our business. Any claims by third parties that we have misappropriated their confidential information or trade secrets could have a similar negative impact on our business.

The cost to us in defending or initiating any litigation or other proceeding relating to patent or other proprietary rights, even if resolved in our favor, could be substantial, and litigation would divert our management’s attention. Some of our competitors may be able to sustain the costs of complex patent litigation more effectively than we can because they have substantially greater resources. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could delay our research and development efforts and limit our ability to continue our operations.

We may be subject to claims that our employees, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties.

We employ individuals who were previously employed at other biotechnology or biopharmaceutical companies. Although we try to ensure that our employees, consultants and advisors do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or our employees, consultants, or independent contractors have inadvertently or otherwise used or disclosed confidential information of our employees’ former employers or other third parties. We may also be subject to claims that former employers or other third parties have an ownership interest in our future patents. Litigation may be necessary to defend against these claims. There is no guarantee of success in defending these claims, and even if we are successful, litigation could result in substantial cost and be a distraction to our management and other employees.

We may be subject to claims challenging the inventorship or ownership of our future patents and other intellectual property.

We may also be subject to claims that former employees, collaborators, or other third parties have an ownership interest in our patent applications, our future patents, or other intellectual property. We may be subject to ownership disputes in the future arising, for example, from conflicting obligations of consultants or others who are involved in developing our product candidates. Although it is our policy to require our employees and contractors who may be involved in the conception or development 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 or develops intellectual property that we regard as our own, and we cannot be certain that our agreements with such parties will be upheld in the face of a potential challenge, or that they will not be breached, for which we may not have an adequate remedy. The assignment of intellectual property rights may not be self-executing or the assignment agreements may be breached, and 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. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

Reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our trade secrets will be misappropriated or disclosed.

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If we continue to rely on third parties to manufacture or commercialize bentracimab, pemziviptadil, PB6440 or any future product candidates, or if we continue to collaborate with additional third parties for the development of bentracimab, pemziviptadil, PB6440 or any future product candidates, we must, at times, share trade secrets with them. We may also continue to conduct joint research and development programs that may require us to share trade secrets under the terms of our research and development partnerships or similar agreements. We seek to protect our proprietary technology in part by entering into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with our advisors, employees, third-party contractors and consultants prior to beginning research or disclosing proprietary information. These agreements typically limit the rights of the third parties to use or disclose our confidential information, including our trade secrets. Despite the contractual provisions employed when working with third parties, the need to share trade secrets and other confidential information increases the risk that such trade secrets become known by our competitors, are inadvertently incorporated into the technology of others, or are disclosed or used in violation of these agreements. Given that our proprietary position is based, in part, on our know-how and trade secrets, a competitor’s discovery of our trade secrets or other unauthorized use or disclosure could have an adverse effect on our business and results of operations.

In addition, these agreements typically restrict the ability of our advisors, employees, third-party contractors and consultants to publish data potentially relating to our trade secrets. Despite our efforts to protect our trade secrets, we may not be able to prevent the unauthorized disclosure or use of our technical know-how or other trade secrets by the parties to these agreements. Moreover, we cannot guarantee that we have entered into such agreements with each party that may have or have had access to our confidential information or proprietary technology and processes. Monitoring unauthorized uses and disclosures is difficult, and we do not know whether the steps we have taken to protect our proprietary technologies will be effective. If any of the collaborators, scientific advisors, employees, contractors and consultants who are parties to these agreements breaches or violates the terms of any of these agreements, we may not have adequate remedies for any such breach or violation, and we could lose our trade secrets as a result. Moreover, if confidential information that is licensed or disclosed to us by our partners, collaborators, or others is inadvertently disclosed or subject to a breach or violation, we may be exposed to liability to the owner of that confidential information. Enforcing a claim that a third party illegally obtained and is using our trade secrets, like patent litigation, is expensive and time consuming, and the outcome is unpredictable. In addition, courts outside the United States are sometimes less willing to protect trade secrets.

We may enjoy only limited geographical protection with respect to certain patents, and we may not be able to protect our intellectual property rights throughout the world.

Filing and prosecuting patent applications and defending patents covering our product candidates in all countries throughout the world would be prohibitively expensive. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we have patent protection but where enforcement rights are not as strong as that in the United States or Europe. These products may compete with our product candidates, and our future patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.

In addition, we may decide to abandon national and regional patent applications before they are granted. The examination of each national or regional patent application is an independent proceeding. As a result, patent applications in the same family may issue as patents in some jurisdictions, such as in the United States, but may issue as patents with claims of different scope or may even be refused in other jurisdictions. It is also quite common that depending on the country, the scope of patent protection may vary for the same product candidate or technology.

While we intend to protect our intellectual property rights in our expected significant markets, we cannot ensure that we will be able to initiate or maintain similar efforts in all jurisdictions in which we may wish to market our product candidates. Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate, which may have an adverse effect on our ability to successfully commercialize our product candidates in all of our expected significant foreign markets. If we encounter difficulties in protecting, or are otherwise precluded from effectively protecting, the intellectual property rights important for our business in such jurisdictions, the value of these rights may be diminished, and we may face additional competition from others in those jurisdictions.

The laws of some jurisdictions do not protect intellectual property rights to the same extent as the laws or rules and regulations in the United States and Europe, and many companies have encountered significant difficulties in protecting and defending such rights in such jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property rights, which could make it difficult for us to stop the infringement of our future patents or marketing of competing products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in other jurisdictions, whether or not successful, could result in substantial costs and

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divert our efforts and attention from other aspects of our business, could put our future patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing as patents, 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 license.

Some countries also have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition, some countries limit the enforceability of patents against government agencies or government contractors. In those countries, the patent owner may have limited remedies, which could materially diminish the value of such patents. If we are forced to grant a license to third parties with respect to any patents relevant to our business, our competitive position may be impaired.

Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by government patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.

Periodic maintenance fees, renewal fees, annuity fees and various other government fees on patents and/or applications will be due to be paid to the USPTO and various government patent agencies outside of the United States over the lifetime of our patents and/or applications and any patent rights we may obtain in the future. Furthermore, the USPTO and various non-United States government patent agencies require compliance with several procedural, documentary, fee payment and other similar provisions during the patent application process. In many cases, an inadvertent lapse of a patent or patent application can be cured by payment of a late fee or by other means in accordance with the applicable rules. There are situations, however, in which non-compliance can result in abandonment or lapse of the patents or patent applications, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, potential competitors might be able to enter the market, which could have a material adverse effect on our business.

Any trademarks we have obtained or may obtain may be infringed or otherwise violated, or successfully challenged, resulting in harm to our business.

We expect to rely on trademarks as one means to distinguish our product candidates, if approved for marketing, from the drugs of our competitors. Once we select new trademarks and apply to register them, our trademark applications may not be approved. Third parties may oppose or attempt to cancel our trademark applications or trademarks, or otherwise challenge our use of the trademarks. In the event that our trademarks are successfully challenged, we could be forced to rebrand our drugs, which could result in loss of brand recognition and could require us to devote resources to advertising and marketing new brands. Our competitors may infringe or otherwise violate our trademarks and we may not have adequate resources to enforce our trademarks. Any of the foregoing events may have a material adverse effect on our business.

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. The following examples are illustrative:

•others may be able to make products that are similar to or otherwise competitive with our product candidates but that are not covered by the claims of our current or future patents;

•an in-license necessary for the manufacture, use, sale, offer for sale or importation of one or more of our product candidates may be terminated by the licensor;

•we or future collaborators might not have been the first to make the inventions covered by our issued or future issued patents or our pending patent applications;

•we or future collaborators might not have been the first to file patent applications covering certain of our inventions;

•others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing our intellectual property rights;

•it is possible that our pending patent applications will not lead to issued patents;

•issued patents that we own or in-license may be held invalid or unenforceable as a result of legal challenges by our competitors;

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•issued patents that we own or in-license may not provide coverage for all aspects of our product candidates in all countries;

•our competitors might conduct research and development 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; and

•the patents of others may have an adverse effect on our business.

Should any of these events occur, they could significantly harm our business, results of operations and prospects.

Risks Related to Legal and Regulatory Compliance Matters

Our relationships with customers, healthcare providers, physicians and third-party payors are subject, directly or indirectly, to federal and state healthcare fraud and abuse laws, false claims laws, health information privacy and security laws, and other healthcare laws and regulations. If we are unable to comply, or have not fully complied, with such laws, we could face substantial penalties.

Healthcare providers, physicians and third-party payors in the United States and elsewhere will play a primary role in the recommendation and prescription of any product candidates for which we obtain marketing approval. Our current and future arrangements with healthcare professionals, principal investigators, consultants, customers and third-party payors subject us to various federal and state fraud and abuse laws and other healthcare laws, including, without limitation, the federal Anti-Kickback Statute, the federal civil and criminal false claims laws, health information privacy laws, and the law commonly referred to as the Physician Payments Sunshine Act and regulations promulgated under such laws. These laws will impact, among other things, our clinical research, proposed sales, marketing and educational programs, and other interactions with healthcare professionals. In addition, we may be subject to patient privacy laws by both the federal government and the states in which we conduct or may conduct our business. The laws that will affect our operations include, but are not limited to:

•the federal Anti-Kickback Statute, which prohibits, among other things, individuals 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, or to induce, either the referral of an individual, or the purchase, lease, order or arrangement for or recommendation of the purchase, lease, order or arrangement for any good, facility, item or service for which payment may be made, in whole or in part, under a federal healthcare program, such as the Medicare and Medicaid programs. The term “remuneration” has been broadly interpreted to include anything of value. Although there are a number of statutory exceptions and regulatory safe harbors protecting some common activities from prosecution, the exceptions and safe harbors are drawn narrowly. Practices that involve remuneration that may be alleged to be intended to induce prescribing, purchases or recommendations may be subject to scrutiny if they do not qualify for an exception or safe harbor. A person does not need to have actual knowledge of this statute or specific intent to violate it in order to have committed a violation. In addition, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively, the ACA, signed into law in 2010, provides that the government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal False Claims Act;

•the federal civil and criminal false claims laws, including, without limitation, the federal False Claims Act, which can be enforced by private citizens through civil whistleblower or qui tam actions, and civil monetary penalty laws, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, claims for payment or approval from the federal government, including Medicare, Medicaid and other government payors, that are false or fraudulent or knowingly making, using or causing to be made or used a false record or statement material to a false or fraudulent claim or to avoid, decrease or conceal an obligation to pay money to the federal government. A claim includes “any request or demand” for money or property presented to the United States federal government. Several pharmaceutical and other healthcare companies have been prosecuted under these laws for allegedly providing free product to customers with the expectation that the customers would bill federal programs for the product. Other companies have been prosecuted for causing false claims to be submitted because of the companies’ marketing of products for unapproved, and thus non-reimbursable, uses;

•the federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which created additional federal criminal statutes that prohibit, among other things, a person from knowingly and willfully

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executing, or attempting to execute, a scheme to defraud any healthcare benefit program, including private third-party payors and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false, fictitious or fraudulent statement in connection with the delivery of or payment for healthcare benefits, items or services. Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

•HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, or HITECH, and their implementing regulations, which imposes certain requirements relating to the privacy, security and transmission of individually identifiable health information on health plans, healthcare clearinghouses and certain healthcare providers, known as “covered entities”, and their respective HIPAA “business associates”, which are independent contractors that perform certain services involving the use or disclosure of individually identifiable health information and their subcontractors that use, disclose or otherwise process individually identifiable health information. HITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates, and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce HIPAA and seek attorneys’ fees and costs associated with pursuing federal civil actions;

•the federal transparency laws, including the federal Physician Payments Sunshine Act, which requires certain manufacturers of drugs, medical devices, biologicals and medical supplies for which payment is available under Medicare, Medicaid or the State Children’s Health Insurance Program, with specific exceptions, to report annually to CMS information related to: (1) payments or other “transfers of value’’ made to physicians (defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, and (2) ownership and investment interests held by physicians and their immediate family members, which will be expanded beginning in 2022 to require applicable manufacturers to report such information regarding their payments or other transfers of value made during the prior year to physicians assistants, nurse practitioners, clinical nurse specialists, anesthesiologist assistants, certified registered nurse anesthetists and certified nurse midwives; and

•state and foreign law equivalents of each of the above federal laws and regulations; state laws that require manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers, marketing expenditures or drug pricing; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government, or that otherwise restrict payments that may be made to healthcare providers; state and local laws that require the registration of pharmaceutical sales representatives; and state and foreign laws that govern the privacy and security of health information in some circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts. For example, the General Data Protection Regulation (EU) 2016/679, or GDPR, which went into effect on May 25, 2018, imposes privacy and security obligations on any entity that collects and/or processes health data from individuals located in the European Union. Under the GDPR, fines of up to 20 million Euros or up to 4% of the annual global turnover of the infringer, whichever is greater, could be imposed for significant non-compliance. In addition, on June 28, 2018, California enacted the California Consumer Privacy Act, or CCPA, which took effect on January 1, 2020. The CCPA gives California residents expanded rights to access and delete their personal information, opt out of certain personal information sharing, and receive detailed information about how their personal information is used. The CCPA provides for civil penalties for violations, as well as a private right of action for data breaches that is expected to increase data breach litigation. Some observers have noted that the CCPA could mark the beginning of a trend toward more stringent state privacy legislation in the United States, which could increase our potential liability and adversely affect our business. As well as complicating our compliance efforts, non-compliance with these laws could result in penalties or significant legal liability.

Because of the breadth of these laws and the narrowness of the statutory exceptions and regulatory safe harbors available, it is possible that some of our business activities could be subject to challenge under one or more of such laws. It is possible that governmental authorities will conclude that our business practices may not comply with current or future statutes, regulations or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply to us, we may be subject to significant penalties, including, without limitation, civil, criminal and administrative penalties, damages, fines, disgorgement, imprisonment, exclusion from participating in federal and state funded healthcare programs, such as Medicare and Medicaid,

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additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, contractual damages, diminished profits and future earnings, reputational harm and the curtailment or restructuring of our operations, any of which could harm our business.

The risk of our being found in violation of these laws is increased by the fact that many of them have not been fully interpreted by the regulatory authorities or the courts, and their provisions are open to a variety of interpretations. Efforts to ensure that our business arrangements with third parties will comply with applicable healthcare laws and regulations will involve substantial costs. Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses and divert our management’s attention from the operation of our business. The shifting compliance environment and the need to build and maintain robust and expandable systems to comply with multiple jurisdictions with different compliance and/or reporting requirements increases the possibility that a healthcare company may run afoul of one or more of the requirements.

Even if we obtain regulatory approval for bentracimab, pemziviptadil, PB6440 or any future product candidates, they will remain subject to ongoing regulatory oversight.

Even if we obtain any regulatory approval for bentracimab, pemziviptadil, PB6440 or any future product candidates, such product candidates, once approved, will be subject to ongoing regulatory requirements applicable to manufacturing, labeling, packaging, storage, advertising, promoting, sampling, record-keeping and submitting of safety and other post-market information, among other things. Any regulatory approvals that we receive for bentracimab, pemziviptadil, PB6440 or any future product candidates may also be subject to a risk evaluation and mitigation strategy, limitations on the approved indicated uses for which the drug may be marketed or to the conditions of approval, or requirements that we conduct potentially costly post-marketing testing, including Phase 4 trials, and in the event that we receive accelerated approval of bentracimab, the completion of a Phase 3 trial, and surveillance to monitor the quality, safety and efficacy of the drug. An unsuccessful post-marketing study or failure to complete such a study could result in the withdrawal of marketing approval. We will further be required to immediately report any serious and unexpected adverse events and certain quality or production problems with our products to regulatory authorities along with other periodic reports.

Any new legislation addressing drug safety issues could result in delays in product development or commercialization, or increased costs to assure compliance. We will also have to comply with requirements concerning advertising and promotion for our products. Promotional communications with respect to prescription drug products are subject to a variety of legal and regulatory restrictions and must be consistent with the information in the product’s approved label. As such, we will not be allowed to promote our products for indications or uses for which they do not have approval, commonly known as off-label promotion. The holder of an approved BLA must submit new or supplemental applications and obtain prior approval for certain changes to the approved product, product labeling, or manufacturing process.

In addition, drug manufacturers are subject to payment of user fees and continual review and periodic inspections by the FDA and other regulatory authorities for compliance with cGMP requirements and adherence to commitments made in the BLA or NDA or foreign marketing application. If we, or a regulatory authority, discover previously unknown problems with a drug, such as adverse events of unanticipated severity or frequency, or problems with the facility where the drug is manufactured or if a regulatory authority disagrees with the promotion, marketing or labeling of that drug, a regulatory authority may impose restrictions relative to that drug, the manufacturing facility or us, including requesting a recall or requiring withdrawal of the drug from the market or suspension of manufacturing.

If we fail to comply with applicable regulatory requirements following approval of bentracimab, pemziviptadil, PB6440 or any future product candidates, a regulatory authority may:

•issue an untitled letter or warning letter asserting that we are in violation of the law;

•seek an injunction or impose administrative, civil or criminal penalties or monetary fines;

•suspend or withdraw regulatory approval;

•suspend any ongoing clinical trials;

•refuse to approve a pending BLA, NDA or comparable foreign marketing application (or any supplements thereto) submitted by us or our strategic partners;

•restrict the marketing or manufacturing of the drug;

•seize or detain the drug or otherwise require the withdrawal of the drug from the market;

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•refuse to permit the import or export of product candidates; or

•refuse to allow us to enter into supply contracts, including government contracts.

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 bentracimab, pemziviptadil, PB6440 or any future product candidates and harm our business, financial condition, results of operations and prospects.

Healthcare legislative or regulatory reform measures may have a negative impact on our business and results of operations.

In the United States and some foreign jurisdictions, there have been, and continue to be, several legislative and regulatory changes and proposed changes regarding the healthcare system that could prevent or delay marketing approval of product candidates, restrict or regulate post-approval activities, and affect our ability to profitably sell any product candidates for which we obtain marketing approval.

Among policy makers and payors in the United States and elsewhere, there is significant interest in promoting changes in healthcare systems with the stated goals of containing healthcare costs, improving quality and/or expanding access. In the United States, the pharmaceutical industry has been a particular focus of these efforts and has been significantly affected by major legislative initiatives. In March 2010, the ACA was passed, which substantially changed the way healthcare is financed by both the government and private insurers and significantly impacts the United States pharmaceutical industry. The ACA, among other things contains a number of provisions of particular import to the pharmaceutical and biotechnology industries, including, but not limited to, those governing enrollment in federal healthcare programs, a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs that are inhaled, infused, instilled, implanted or injected, and annual fees based on pharmaceutical companies’ share of sales to federal health care programs.

There have been executive, judicial and Congressional challenges to certain aspects of the ACA. While Congress has not passed comprehensive repeal legislation, several bills affecting the implementation of certain taxes under the ACA have been signed into law. The Tax Cuts and Jobs Act of 2017, or the Tax Act, includes a provision that repealed, effective January 1, 2019, the tax-based shared responsibility payment imposed by the ACA on certain individuals who fail to maintain qualifying health coverage for all or part of a year that is commonly referred to as the “individual mandate.” In addition, the 2020 federal spending package permanently eliminated, effective January 1, 2020, the ACA-mandated “Cadillac” tax on high-cost employer-sponsored health coverage and medical device tax and, effective January 1, 2021, also eliminated the health insurer tax. The Bipartisan Budget Act of 2018, or the BBA, among other things, amended the ACA, effective January 1, 2019, to close the coverage gap in most Medicare drug plans, commonly referred to as the “donut hole.” On June 17, 2021, the U.S. Supreme Court dismissed on procedural grounds a challenge that argued that the ACA is unconstitutional in its entirety because the “individual mandate” was repealed by Congress. Thus, the ACA will remain in effect in its current form. Further, prior to the U.S. Supreme Court ruling, on January 28, 2021, President Biden issued an executive order that initiated a special enrollment period for purposes of obtaining health insurance coverage through the ACA marketplace, which began February 15, 2021 and will remain open through August 15, 2021.

The executive order also instructs certain governmental agencies to review and reconsider their existing policies and rules that limit access to healthcare, including among others, reexamining Medicaid demonstration projects and waiver programs that include work requirements and policies that create unnecessary barriers to obtaining access to health insurance through Medicaid or the ACA. It is possible that the ACA will be subject to judicial or congressional challenges in the future. It is unclear how any such challenges and the healthcare reform measures of the Biden administration will impact the ACA and our business.

Other legislative changes have been proposed and adopted since the ACA was enacted. These changes include aggregate reductions to Medicare payments to providers of 2% per fiscal year pursuant to the Budget Control Act of 2011, which began in 2013, and due to subsequent legislative amendments to the statute, including the BBA, will remain in effect through 2030, unless additional Congressional action is taken. However, COVID-19 relief legislation suspended the 2% Medicare sequester from May 1, 2020 through December 31, 2021. The American Taxpayer Relief Act of 2012, among other things, further reduced Medicare payments to several providers, including hospitals and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. These laws may result in additional reductions in Medicare and other healthcare funding, which could have an adverse effect on customers for our product candidates, if approved, and, accordingly, our financial operations.

Additionally, there has been heightened governmental scrutiny in the United States of pharmaceutical pricing practices in light of the rising cost of prescription drugs and biologics. Such scrutiny has resulted in several recent congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program

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reimbursement methodologies for products. At the federal level, the Trump administration used several means to propose or implement drug pricing reform, including through federal budget proposals, executive orders and policy initiatives. For example, on July 24, 2020 and September 13, 2020, the Trump administration announced several executive orders related to prescription drug pricing that sought to implement several of the administration’s proposals. As a result, the FDA released a final rule on September 24, 2020, effective November 30, 2020, providing guidance for states to build and submit importation plans for drugs from Canada. Further, on November 20, 2020, the U.S. Department of Health & Human Services, or HHS, finalized a regulation removing safe harbor protection for price reductions from pharmaceutical manufacturers to plan sponsors under Part D, either directly or through pharmacy benefit managers, unless the price reduction is required by law. The implementation of the rule has been delayed by the Biden administration from January 1, 2022 to January 1, 2023 in response to ongoing litigation. The rule also creates a new safe harbor for price reductions reflected at the point-of-sale, as well as a safe harbor for certain fixed fee arrangements between pharmacy benefit managers and manufacturers, the implementation of which have also been delayed until January 1, 2023. On November 20, 2020, CMS issued an interim final rule implementing President Trump’s Most Favored Nation, or MFN, executive order, which would tie Medicare Part B payments for certain physician-administered drugs to the lowest price paid in other economically advanced countries, effective January 1, 2021. On December 28, 2020, the U.S. District Court for the Northern District of California issued a nationwide preliminary injunction against implementation of the interim final rule. On January 13, 2021, in a separate lawsuit brought by industry groups in the U.S. District Court for the District of Maryland, the government defendants entered a joint motion to stay litigation on the condition that the government would not appeal the preliminary injunction granted in the U.S. District Court for the Northern District of California and that performance for any final regulation stemming from the MFN Model interim final rule shall not commence earlier than 60 days after publication of that regulation in the Federal Register. It is unclear whether the Biden administration will work to reverse these measures or pursue similar policy initiatives. At the state level, legislatures have increasingly passed legislation and implemented 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 importation from other countries and bulk purchasing.

We expect that these and other healthcare reform measures that may be adopted in the future may result in more rigorous coverage criteria and in additional downward pressure on the price that we receive for any approved drug. Any reduction in reimbursement from Medicare or other government programs may result in a similar reduction in payments from private payors. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our drugs. Further, it is possible that additional governmental action may be taken in response to the COVID-19 pandemic.

Any new regulations or guidance, or revisions or reinterpretations of existing regulations or guidance, may impose additional costs or lengthen FDA review times for bentracimab, pemziviptadil, PB6440 or any future product candidates. We cannot determine how changes in regulations, statutes, policies, or interpretations when and if issued, enacted or adopted, may affect our business in the future. Such changes could, among other things, require:

•additional clinical trials to be conducted prior to obtaining approval;

•changes to manufacturing methods;

•recalls, replacements, or discontinuance of one or more of our products; and

•additional recordkeeping.

Such changes would likely require substantial time and impose significant costs, or could reduce the potential commercial value of bentracimab, pemziviptadil, PB6440 or other product candidates, and could materially harm our business and our financial results. In addition, delays in receipt of or failure to receive regulatory clearances or approvals for any other products would harm our business, financial condition, and results of operations.

Risks Related to Employee Matters and Managing Our Growth

Our future success depends on our ability to retain key executives and to attract, retain and motivate qualified personnel.

We are highly dependent on the management, development, clinical, financial and business development expertise of our executive officers, particularly Jonathan P. Mow, our Chief Executive Officer. Each of our executive officers may currently terminate their employment with us at any time. We do not maintain “key person” insurance for any of our executives or employees.

Recruiting and retaining qualified scientific and clinical personnel and, if we progress the development of our product pipeline toward scaling up for commercialization, manufacturing and sales and marketing personnel, will also be critical to our success. The loss of the services of our executive officers or other key employees could impede the achievement of our

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development and commercialization objectives and seriously harm our ability to successfully implement our business strategy. Furthermore, replacing executive officers and key employees may be difficult and may take an extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to successfully develop, gain regulatory approval of and commercialize products. Competition to hire from this limited pool is intense, and we may be unable to hire, train, retain or motivate these key personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies for similar personnel. We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions. In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our development 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. If we are unable to continue to attract and retain high quality personnel, our ability to pursue our growth strategy will be limited.

We expect to expand our clinical development and regulatory capabilities and potentially implement sales, marketing and distribution capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.

As of June 30, 2021, we had approximately 55 employees. As our development progresses, we expect to experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of clinical product development, regulatory affairs and, if any of our product candidates receives marketing approval, sales, marketing and distribution. To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities and continue to recruit and train additional qualified personnel. Due to our limited financial resources and the limited experience of our management team in managing a company with such anticipated growth, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel. The expansion of our operations may lead to significant costs and may divert our management and business development resources. Any inability to manage growth could delay the execution of our business plans or disrupt our operations.

Our employees, independent contractors, consultants, commercial collaborators, principal investigators, CROs, suppliers and vendors may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements.

We are exposed to the risk that our employees, independent contractors, consultants, commercial collaborators, principal investigators, CROs, suppliers and vendors may engage in fraudulent conduct or other illegal activity. Misconduct by these parties could include intentional, reckless and/or negligent conduct or disclosure of unauthorized activities to us that violates FDA regulations, including those laws requiring the reporting of true, complete and accurate information to the FDA, manufacturing standards, federal and state healthcare laws and regulations, and laws that require the true, complete and accurate reporting of financial information or data. In particular, sales, marketing and business arrangements in the healthcare industry are subject to extensive laws and regulations intended to prevent fraud, kickbacks, self-dealing and other abusive practices. These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements. Misconduct by these parties could also involve the improper use of individually identifiable information, including, without limitation, information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation. We have adopted a code of business conduct and ethics, but it is not always possible to identify and deter 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 governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such 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, including the imposition of significant civil, criminal and administrative penalties, including, without limitation, damages, fines, disgorgement, imprisonment, exclusion from participation in government healthcare programs, such as Medicare and Medicaid, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, and the curtailment or restructuring of our operations.

Risks Related to Ownership of Our Common Stock and Our Status as a Public Company

An active trading market for our common stock may not continue to be developed or sustained.

Prior to our initial public offering, or IPO, there was no public market for our common stock, and we cannot assure you that an active trading market for our shares will continue to develop or be sustained. As a result, it may be difficult for you to sell shares at an attractive price or at all.

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The trading price of the shares of our common stock may be volatile, and purchasers of our common stock could incur substantial losses.

Our stock price has been, and may continue to be, volatile. Since our IPO, our common stock has traded at prices ranging from $2.55 to $16.65 per share. The stock market in general and the market for biopharmaceutical companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, investors may not be able to sell their common stock at or above the price paid for the shares. The market price for our common stock may be influenced by many factors, including:

•the commencement, enrollment or results of our clinical trials of bentracimab, pemziviptadil, PB6440 or any future clinical trials we may conduct, or changes in the development status of our product candidates;

•any delay in our regulatory filings for bentracimab, pemziviptadil, PB6440 or any other product candidate we may develop, and any adverse development or perceived adverse development with respect to the applicable regulatory authority’s review of such filings, including without limitation the FDA’s issuance of a “refusal to file” letter or a request for additional information;

•adverse results from, delays in or termination of clinical trials;

•adverse regulatory decisions, including failure to receive regulatory approval of our product candidates;

•unanticipated serious safety concerns related to the use of bentracimab, pemziviptadil, PB6440 or any other product candidate;

•changes in financial estimates by us or by any equity research analysts who might cover our stock;

•conditions or trends in our industry;

•changes in the market valuations of similar companies;

•stock market price and volume fluctuations of comparable companies and, in particular, those that operate in the biopharmaceutical industry;

•publication of research reports about us or our industry or positive or negative recommendations or withdrawal of research coverage by securities analysts;

•announcements by us or our competitors of significant acquisitions, strategic partnerships or divestitures;

•progress under our collaboration with SFJ for the development of bentracimab;

•announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us;

•investors’ general perception of our company and our business;

•recruitment or departure of key personnel;

•overall performance of the equity markets;

•trading volume of our common stock;

•disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our technologies;

•significant lawsuits, including patent or stockholder litigation;

•changes in the structure of healthcare payment systems;

•general political and economic conditions; and

•other events or factors, many of which are beyond our control.

The stock market in general has, and the Nasdaq Global Market and biotechnology companies in particular have, experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies, including in connection with the ongoing COVID-19 pandemic, which has resulted in decreased stock prices for many companies notwithstanding the lack of a fundamental change in their underlying business models or prospects. Broad market and industry factors, including potentially worsening economic conditions and other adverse effects or developments relating to the ongoing COVID-19 pandemic, may negatively affect the market price of our common stock, regardless of our actual operating performance. The realization of any of the above risks or any of a broad range of other risks, including those described in this section, could have a significant and material adverse impact on the market price of our common stock.

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In addition, in the past, stockholders have initiated class action lawsuits against pharmaceutical and biotechnology companies following periods of volatility in the market prices of these companies’ stock. Such litigation, if instituted against us, could cause us to incur substantial costs and divert management’s attention and resources from our business.

A significant portion of our total outstanding shares are available for immediate resale. This could cause the market price of our common stock to drop significantly, even if our business is doing well.

Sales of a substantial number of shares of our common stock in the public market could occur at any time. If our stockholders sell, or the market perceives that our stockholders intend to sell, substantial amounts of our common stock in the public market, the market price of our common stock could decline significantly.

In addition, we have filed registration statements on Form S-8 registering the issuance of common stock subject to options or other equity awards issued or reserved for future issuance under our equity incentive plans. Shares registered under these registration statements on Form S-8 will be available for sale in the public market subject to vesting arrangements and exercise of options and the restrictions of Rule 144 in the case of our affiliates.

Additionally, the holders of approximately 2.2 million shares of our common stock, or their transferees, have rights, subject to some conditions, to require us to file one or more registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or other stockholders. If we were to register the resale of these shares, they could be freely sold in the public market. If these additional shares are sold, or if it is perceived that they will be sold, in the public market, the trading price of our common stock could decline.

The issuance of additional stock in connection with financings, acquisitions, investments, our equity incentive plan or otherwise will dilute all other stockholders.

Our certificate of incorporation authorizes us to issue up to 200,000,000 shares of common stock and up to 10,000,000 shares of preferred stock with such rights and preferences as may be determined by our board of directors. Subject to compliance with applicable rules and regulations, in the future we may issue common stock or other securities convertible into shares of our common stock from time to time in connection with a financing, acquisition, investment, our equity incentive plan or otherwise. The number of new shares of our common stock issued in connection with raising additional capital could constitute a material portion of the then outstanding shares of our common stock, which could result in substantial dilution to our existing stockholders and cause the market price of our common stock to decline.

Provisions in our corporate charter documents and under Delaware law may prevent or frustrate attempts by our stockholders to change our management and hinder efforts to acquire a controlling interest in us, and the market price of our common stock may be lower as a result.

There are provisions in our certificate of incorporation and bylaws that may make it difficult for a third party to acquire, or attempt to acquire, control of our company, even if a change of control was considered favorable by you and other stockholders. For example, our board of directors has the authority to issue up to 10,000,000 shares of preferred stock. The board of directors can fix the price, rights, preferences, privileges, and restrictions of the preferred stock without any further vote or action by our stockholders. The issuance of shares of preferred stock may delay or prevent a change of control transaction. As a result, the market price of our common stock and the voting and other rights of our stockholders may be adversely affected. An issuance of shares of preferred stock may result in the loss of voting control to other stockholders.

Our charter documents also contain other provisions that could have an anti-takeover effect, including:

•only one of our three classes of directors is elected each year;

•stockholders are not entitled to remove directors other than by a 66 2⁄3% vote and only for cause;

•stockholders are not permitted to take actions by written consent;

•stockholders cannot call a special meeting of stockholders; and

•stockholders must give advance notice to nominate directors or submit proposals for consideration at stockholder meetings.

In addition, we are subject to the anti-takeover provisions of Section 203 of the Delaware General Corporation Law, which regulates corporate acquisitions by prohibiting Delaware corporations from engaging in specified business combinations with particular stockholders of those companies. These provisions could discourage potential acquisition proposals and could

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delay or prevent a change of control transaction. They could also have the effect of discouraging others from making tender offers for our common stock, including transactions that may be in your best interests. These provisions may also prevent changes in our management or limit the price that investors are willing to pay for our stock.

Concentration of ownership of our common stock among our existing executive officers, directors and principal stockholders may prevent new investors from influencing significant corporate decisions.

Our executive officers, directors and current beneficial owners of 5% or more of our common stock and their respective affiliates beneficially own a significant percentage of our outstanding common stock. As a result, these persons, acting together, would be able to significantly influence all matters requiring stockholder approval, including the election and removal of directors, any merger, consolidation, sale of all or substantially all of our assets, or other significant corporate transactions.

Some of these persons or entities may have interests different than yours. For example, because many of these stockholders purchased their shares at prices substantially below the current market price of our common stock and have held their shares for a longer period, they may be more interested in selling our company to an acquirer than other investors, or they may want us to pursue strategies that deviate from the interests of other stockholders.

We are an “emerging growth company” and a “smaller reporting company” and, as a result of the reduced disclosure and governance requirements applicable to emerging growth companies and smaller reporting companies, our common stock may be less attractive to investors.

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and we intend to take advantage of some of the exemptions from reporting requirements that are applicable to other public companies that are not emerging growth companies, including:

•not being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting;

•not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements;

•reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and

•not being required to hold a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. We may take advantage of these reporting exemptions until we are no longer an emerging growth company. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of our initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

Under Section 107(b) of the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Even after we no longer qualify as an emerging growth company, we may, under certain circumstances, still qualify as a “smaller reporting company,” which would allow us to take advantage of many of the same exemptions from disclosure requirements, including reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and, if we are a smaller reporting company with less than $100 million in annual revenue, we would not be required to obtain an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. We may qualify as a “smaller reporting company” for so long as (i) the market value of our voting and non-voting common stock held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter or (ii) our annual revenue is less than $100 million during the most recently completed fiscal year and the market value of our voting and non-voting common stock held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter .

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We have broad discretion in the use of our cash and cash equivalents.

We have broad discretion over the use of our cash and cash equivalents, including the net proceeds from our recent public offerings. You may not agree with our decisions, and our use of these cash and cash equivalents may not yield any return on your investment. We expect to use our existing cash and cash equivalents to advance bentracimab, pemziviptadil and PB6440, fund development of our ELP technology and preclinical programs and for working capital and general corporate purposes. In addition, we may use a portion of our cash and cash equivalents to pursue our strategy to in-license or acquire additional product candidates. Our failure to apply our cash and cash equivalents effectively could compromise our ability to pursue our growth strategy and we might not be able to yield a significant return, if any, on our investment of these cash and cash equivalents. You will not have the opportunity to influence our decisions on how to use these cash and cash equivalents.

Because we do not anticipate paying any cash dividends on our common stock in the foreseeable future, capital appreciation, if any, will be your sole source of gains and you may never receive a return on your investment.

You should not rely on an investment in our common stock to provide dividend income. We have not declared or paid cash dividends on our common stock to date. We currently intend to retain our future earnings, if any, to fund the development and growth of our business. In addition, the terms of the SFJ Agreement preclude us from paying dividends, and any existing or future debt agreements may preclude us from paying dividends. As a result, capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future. Investors seeking cash dividends should not purchase our common stock.

Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware and the federal district courts of the United States of America will be the exclusive forums for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware is the exclusive forum for (1) any derivative action or proceeding brought on our behalf, (2) any action asserting a claim for breach of a fiduciary duty owed by any of our directors, officers or other employees to us or our stockholders, (3) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our amended and restated certificate of incorporation or our amended and restated bylaws or (4) any action asserting a claim governed by the internal affairs doctrine. This provision would not apply to suits brought to enforce a duty or liability created by the Exchange Act. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions. Accordingly, both state and federal courts have jurisdiction to entertain such claims. To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our amended and restated certificate of incorporation further provides that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act. While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions. In such instance, we would expect to vigorously assert the validity and enforceability of the exclusive forum provisions of our amended and restated certificate of incorporation. This may require significant additional costs associated with resolving such action in other jurisdictions and there can be no assurance that the provisions will be enforced by a court in those other jurisdictions.

These exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and other employees. If a court were to find either exclusive-forum provision in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur further significant additional costs associated with resolving the dispute in other jurisdictions, all of which could seriously harm our business.

General Risk Factors

Our business activities will be subject to the Foreign Corrupt Practices Act, or FCPA, and similar anti-bribery and anti-corruption laws.

As we expand our business activities outside of the United States, including our clinical trial efforts, we will be subject to the FCPA and similar anti-bribery or anti-corruption laws, regulations or rules of other countries in which we operate. The FCPA generally prohibits offering, promising, giving, or authorizing others to give anything of value, either directly or indirectly, to a non-United States government official in order to influence official action, or otherwise obtain or retain business.

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The FCPA also requires public companies to make and keep books and records that accurately and fairly reflect the transactions of the corporation and to devise and maintain an adequate system of internal accounting controls. Our business is heavily regulated and therefore requires significant interaction with public officials, including officials of non-United States governments. Additionally, in many other countries, the healthcare providers who prescribe pharmaceuticals are employed by their government, and the purchasers of pharmaceuticals are government entities; therefore, our dealings with these prescribers and purchasers will be subject to regulation under the FCPA. Recently the Securities and Exchange Commission, or the SEC, and Department of Justice have increased their FCPA enforcement activities with respect to biotechnology and pharmaceutical companies. There is no certainty that all of our employees, agents, suppliers, manufacturers, contractors, or collaborators, or those of our affiliates, will comply with all applicable laws and regulations, particularly given the high level of complexity of these laws. Violations of these laws and regulations could result in fines, criminal sanctions against us, our officers, or our employees, the closing down of facilities, including those of our suppliers and manufacturers, requirements to obtain export licenses, cessation of business activities in sanctioned countries, implementation of compliance programs, and prohibitions on the conduct of our business. Any such violations could include prohibitions on our ability to offer our products in one or more countries as well as difficulties in manufacturing or continuing to develop our products, and could materially damage our reputation, our brand, our international expansion efforts, our ability to attract and retain employees, and our business, prospects, operating results, and financial condition.

If equity research analysts do not publish research or reports, or publish unfavorable research or reports, about us, our business or our market, our stock price and trading volume could decline.

The trading market for our common stock will be influenced by the research and reports that equity research analysts publish about us and our business. As a newly public company, we have only limited research coverage by equity research analysts. Equity research analysts may elect not to provide research coverage of our common stock, and such lack of research coverage may adversely affect the market price of our common stock. In the event we do have equity research analyst coverage, we will not have any control over the analysts or the content and opinions included in their reports. The price of our stock could decline if one or more equity research analysts downgrade our stock or issue other unfavorable commentary or research. If one or more equity research analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which in turn could cause our stock price or trading volume to decline.

If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements on a timely basis could be impaired.

We are subject to the reporting requirements of the Securities Exchange Act of 1934, the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, and the rules and regulations of the stock market on which our common stock is listed. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting.

We may identify weaknesses in our system of internal financial and accounting controls and procedures that could result in a material misstatement of our financial statements. Our internal control over financial reporting will not prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

If we are not able to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, or if we are unable to maintain proper and effective internal controls, we may not be able to produce timely and accurate financial statements. If that were to happen, the market price of our stock could decline and we could be subject to sanctions or investigations by the stock exchange on which our common stock is listed, the SEC, or other regulatory authorities.

New or future changes to tax laws could materially adversely affect our company.

On December 22, 2017, President Trump signed into law H.R. 1, “An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018”, informally titled the Tax Cuts and Jobs Act, or the Tax Act, which significantly revises the United States Internal Revenue Code of 1986, as amended. Future guidance from the United States Internal Revenue Service and other tax authorities with respect to the Tax Act may affect us, and certain aspects of the Tax Act could be repealed or modified in future legislation. For example, on March 27, 2020, President Trump signed into law the CARES Act, which modifies the Tax Act in certain respects. Changes in corporate tax rates, the realization of net deferred tax assets relating to our United States operations, the taxation of foreign earnings and the deductibility of expenses under the Tax Act

79

or future tax reform legislation could have a material impact on the value of our deferred tax assets, could result in significant one-time charges in the current or future taxable years and could increase our future United States tax expense. The foregoing items, as well as any other future changes in tax laws, could have a material adverse effect on our business, cash flow, financial condition or results of operations. In addition, it is uncertain if and to what extent various states will conform to the Tax Act or any newly enacted federal tax legislation.

We might not be able to utilize a significant portion of our net operating loss carryforwards.

At December 31, 2020, we had federal and state net operating loss, or NOL, carryforwards of $185.1 million, $167.2 million, respectively. The federal NOLs generated prior to 2018 may be used to offset up to 100% of future taxable income and will begin to expire in 2022, unless previously utilized or limited by other provisions within the tax law. These net operating loss carryforwards could expire unused and be unavailable to offset future income tax liabilities. Under the Tax Act, as modified by the CARES Act, federal net operating losses incurred in taxable years beginning after December 31, 2017 and in future years may be carried forward indefinitely, but the deductibility of such federal net operating losses incurred in the taxable year beginning after December 31, 2020 is limited. It is uncertain how various states will respond to the Tax Act and CARES Act. In addition, under Section 382 of the Internal Revenue Code of 1986, as amended, and corresponding provisions of state law, if a corporation undergoes an “ownership change,” which is generally defined as a greater than 50% change, by value, in its equity ownership over a three-year period, the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change tax attributes to offset its post-change income or taxes may be limited. We may experience ownership changes as a result of subsequent shifts in our stock ownership, some of which may be outside of our control. If an ownership change occurs and our ability to use our net operating loss carryforwards is materially limited, it would harm our future operating results by effectively increasing our future tax obligations.

Our effective tax rate may fluctuate, and we may incur obligations in tax jurisdictions in excess of accrued amounts.

We are subject to taxation in more than one tax jurisdiction. As a result, our effective tax rate is derived from a combination of applicable tax rates in the various places that we operate. In preparing our financial statements, we estimate the amount of tax that will become payable in each of such places. Nevertheless, our effective tax rate may be different than experienced in the past due to numerous factors, including passage of the newly enacted federal income tax law, changes in the mix of our profitability from jurisdiction to jurisdiction, the results of examinations and audits of our tax filings, our inability to secure or sustain acceptable agreements with tax authorities, changes in accounting for income taxes and changes in tax laws. Any of these factors could cause us to experience an effective tax rate significantly different from previous periods or our current expectations and may result in tax obligations in excess of amounts accrued in our financial statements.

We have incurred and will continue to incur increased costs and demands upon management as a result of being a public company.

As a public company listed in the United States, we are incurring significant additional legal, accounting and other costs. These additional costs could negatively affect our financial results. In addition, changing laws, regulations and standards relating to corporate governance and public disclosure, including regulations implemented by the SEC and the Nasdaq Stock Market, may increase legal and financial compliance costs and make some activities more time-consuming. These laws, regulations and standards are subject to varying interpretations and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. We intend to invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expense and a diversion of management’s time and attention from revenue-generating activities to compliance activities. If notwithstanding our efforts to comply with new laws, regulations and standards, we fail to comply, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

Failure to comply with these rules might also make it more difficult for us to obtain some types of insurance, including director and officer liability insurance, and we might be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, on committees of our board of directors or as members of senior management.

Our business and operations would suffer in the event of computer system failures, cyberattacks or a deficiency in our cybersecurity.

80

Despite the implementation of security measures, our internal computer systems, and those of third parties on which we rely, are vulnerable to damage from computer viruses, malware, natural disasters, terrorism, war, telecommunication and electrical failures, cyberattacks or cyber-intrusions over the Internet, attachments to emails, persons inside our organization, or persons with access to systems inside our organization. The risk of a security breach or disruption, particularly through cyberattacks or cyber intrusion, including by computer hackers, foreign governments, and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. If such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our product development programs. For example, the loss of clinical trial data from completed or ongoing or planned clinical trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. To the extent that any disruption or security breach was to result in a loss of or damage to our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur material legal claims and liability and damage to our reputation, and the further development of our product candidates could be delayed.

Item 2.    Recent Sales of Unregistered Securities and Use of Proceeds

None.

Item 3.    Defaults Upon Senior Securities

Not applicable.

Item 4.    Mine Safety Disclosures

Not applicable.

Item 5.    Other Information

Not applicable.

Item 6.    Exhibits

The exhibits listed on the Exhibit Index are either filed or furnished with this report or incorporated herein by reference. 

EXHIBIT INDEX

		Incorporated by Reference
Exhibit Number	Exhibit Title	Form	File No.	Exhibit	Filing Date
3.1	Amended and Restated Certificate of Incorporation of PhaseBio Pharmaceuticals, Inc.	8-K	001-38697	3.1	October 22, 2018
3.2	Amended and Restated Bylaws of PhaseBio Pharmaceuticals, Inc.	S-1/A	333-227474	3.4	October 5, 2018
4.1	Form of Warrant to Purchase Shares of Series B Redeemable Convertible Preferred Stock, issued by PhaseBio Pharmaceuticals, Inc. on December 22, 2009.	S-1	333-227474	4.2	September 21, 2018
4.2	Warrant to Purchase Shares of Series C-1 Redeemable Convertible Preferred Stock, issued by PhaseBio Pharmaceuticals, Inc. to Silicon Valley Bank on October 18, 2017.	S-1	333-227474	4.3	September 21, 2018

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4.3	Fourth Amended and Restated Investor Rights Agreement, by and among PhaseBio Pharmaceuticals, Inc. and certain of its stockholders, dated August 27, 2018.	S-1	333-227474	4.4	September 21, 2018
4.4	Warrant to Purchase Shares of Common Stock, issued by PhaseBio Pharmaceuticals, Inc. to Silicon Valley Bank on March 25, 2019.	10-K	001-38697	4.4	March 26, 2019
4.5	Warrant to Purchase Shares of Common Stock, issued by PhaseBio Pharmaceuticals, Inc. to WestRiver Innovation Lending Fund VIII, L.P. on March 25, 2019.	10-K	001-38697	4.5	March 26, 2019
4.6	Warrant to Purchase Shares of Common Stock, issued by PhaseBio Pharmaceuticals, Inc. to WestRiver Innovation Lending Fund VIII, L.P. on July 26, 2019.	10-Q	001-38697	4.6	August 14, 2019
4.7	Warrant to Purchase Shares of Common Stock, issued by PhaseBio Pharmaceuticals, Inc. to Silicon Valley Bank on July 26, 2019.	10-Q	001-38697	4.7	August 14, 2019
4.8	Warrant to Purchase Shares of Common Stock, issued by PhaseBio Pharmaceuticals, Inc. to Silicon Valley Bank on October 2, 2019.	10-Q	001-38697	4.8	November 14, 2019
4.9	Warrant to Purchase Shares of Common Stock, issued by PhaseBio Pharmaceuticals, Inc. to WestRiver Innovation Lending Fund VIII, L.P. on October 2, 2019.	10-Q	001-38697	4.9	November 14, 2019
4.10	Warrant to Purchase Shares of Common Stock, issued by PhaseBio Pharmaceuticals, Inc. to SFJ Pharmaceuticals X, Ltd. on January 9, 2020	10-K	001-38697	4.10	March 30, 2020
4.11	Description of PhaseBio Pharmaceuticals, Inc. Common Stock	10-K	001-38697	4.11	March 30, 2020
10.1#†	License Agreement, dated as of June 16, 2021, by and between PhaseBio Pharmaceuticals, Inc. and Alfasigma, S.p.A.
10.2#†	Acknowledgement of Grant of a Sublicense in Accordance with the License Agreement between Medimmune Limited and PhaseBio Pharmaceuticals, Inc. and Related Options

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31.1#	Certification of Chief Executive Officer and President (Principal Executive Officer), pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2#	Certification of Chief Financial Officer (Principal Financial Officer), pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Chief Executive Officer (Principal Executive Officer), pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*	Certification of Chief Financial Officer (Principal Financial Officer), pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS#	Inline XBRL Instance Document.
101.SCH#	Inline XBRL Taxonomy Extension Schema Document.
101.CAL#	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF#	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB#	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE#	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data (formatted as Inline XBRL and contained in Exhibit 101)

#    Filed herewith.

+    Indicates management contract or compensatory plan.

†    Certain portions of this exhibit (indicated by asterisks) have been omitted because they are not material and are the type that PhaseBio Pharmaceuticals, Inc. treats as private or confidential. 

*    These certifications are being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

83

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PHASEBIO PHARMACEUTICALS INC.
August 12, 2021	By:	/s/ John P. Sharp
		John P. Sharp Chief Financial Officer (On behalf of the registrant and in his capacity as Principal Financial Officer and Principal Accounting Officer)

84

EX-10.1

Exhibit 10.1

Certain portions of this exhibit (indicated by “[***]”) have been excluded pursuant to Item 601(b)(10) of Regulation S-K because they are both not material and are the type that the registrant treats as private or confidential.

LICENSE AGREEMENT

between

ALFASIGMA S.P.A.

and

PHASEBIO PHARMACEUTICALS, INC.

Dated as of June 16, 2021

TABLE OF CONTENTS

Page

ARTICLE 1DEFINITIONS	1
ARTICLE 2GRANT OF RIGHTS	21
2.1.Grants to Licensee	21
2.2.Grants to MedImmune	21
2.3.Sublicenses	21
2.4.Retention of Rights; Limitations Applicable to License Grants	22
2.5.Licensed Product Exclusivity	23
2.6.Exceptions related to AstraZeneca Product Exclusivity Commitment of Licensor	24
2.6.Trademark License Agreement	24
2.8.Upstream Agreements	24
2.9.Territory Restriction	25
ARTICLE 3GOVERNANCE	26
3.1.Alliance Managers	26
3.2.Joint Steering Committee	26
3.3.Discontinuation of the JSC	31
4.1.Manufacturing	31
4.2.Development	32
4.3.Regulatory Activities	34
4.4.Commercialization	40
4.5.Statements and Compliance with Applicable Law	43
4.6.Markings	44
4.7.Subcontracting	44
4.8.Product Positioning Principles	44
ARTICLE 5PAYMENTS AND RECORDS	45
5.1.Upfront Payment	45
5.2.Milestones	45
5.3.Royalties	48
5.4.Royalty Payments and Reports	49
5.5.Mode of Payment; Offsets	49
5.6.Taxes	50
5.7.Interest on Late Payments	51
5.8.Financial Records	52
5.9.Audit	52
5.10.Audit Dispute	53
ARTICLE 6INTELLECTUAL PROPERTY	53
6.1.Ownership of Intellectual Property	53
6.2.Maintenance and Prosecution of Patents	59

i

6.3.Enforcement of Patents	61
6.4.Infringement Claims by Third Parties	65
6.5.Invalidity or Unenforceability Defenses or Actions	66
6.6.Product Trademarks	67
6.7.Corporate Names, Licensed Trademarks and Product Trademarks	69
ARTICLE 7CONFIDENTIALITY AND NON-DISCLOSURE	70
7.1.Confidentiality Obligations	70
7.2.Permitted Disclosures	71
7.3.Use of Name	73
7.4.Public Announcements	73
7.5.Publications	75
7.6.Securities Laws	76
7.7.Return of Confidential Information	76
ARTICLE 8REPRESENTATIONS AND WARRANTIES	76
8.1.Mutual Representations and Warranties	76
8.2.Additional Representations and Warranties of MedImmune	77
8.3.DISCLAIMER OF WARRANTIES	79
8.4.Anti-Bribery and Anti-Corruption Compliance	80
ARTICLE 9INDEMNITY	80
9.1.Indemnification of MedImmune	80
9.2.Indemnification of Licensee	80
9.3.Indemnification Procedures	81
9.4.Special, Indirect and Other Losses	83
9.5.Insurance	83
ARTICLE 10TERM AND TERMINATION	83
10.1.Term and Expiration	83
10.2.Termination	83
10.3.Rights in Bankruptcy	89
10.4.Consequences of Termination	89
10.6.Remedies	95
10.7.Accrued Rights; Surviving Obligations	95
ARTICLE 11MISCELLANEOUS	96
11.1.Force Majeure	96
11.2.Export Control	96
11.3.Assignment	96
11.4.Certain Transactions Involving MedImmune and its Affiliates	97
11.4.Certain Transactions Involving MedImmune and its Affiliates	98
11.5.Severability	98
11.6.Dispute Resolution	98
11.7.Governing Law, Jurisdiction and Service	100
11.8.Notices	101

ii

11.9.Entire Agreement; Amendments	102
11.10.English Language	102
11.11.Equitable Relief	102
11.12.Waiver and Non-Exclusion of Remedies	102
11.13.No Benefit to Third Parties	103
11.14.Further Assurance	103
11.15.Relationship of the Parties	103
11.16.References	103
11.17.Construction	103
11.18.Counterparts	104

iii

SCHEDULES

Schedule 1.41    Development Plan

Schedule 1.76    Protein Sequence of Licensed Compound

Schedule 1.77    Licensed Know-How

Schedule 1.78        Licensed Patents

Schedule 1.83        Licensee Corporate Names

Schedule 1.90        Licensor Corporate Names

Schedule 1.104    MedImmune Corporate Names (Schedule 1.98 of the MedImmune License)

Schedule 4.1.2    Supply Agreement Terms

Schedule 4.3.6(h)    Timelines for Reporting of Serious Adverse Event

EXHIBITS

Exhibit 4.3.6(a))    Copies of MedImmune Pharmacovigilance Agreement and
SFJ Pharmacovigilance Agreement

iv

LICENSE AGREEMENT

This License Agreement (this “Agreement”) is madeand entered into as of June 16, 2021 (the “Effective Date”) by and between PhaseBio Pharmaceuticals, Inc., a corporation formed under the laws of Delaware having its place of businessat 1 Great Valley Parkway, Suite 30, Malvern, Pennsylvania 19355, United States (“Licensor”) and Alfasigma S.p.A, an Italian company having its place of business at Via Ragazzi del ’99, 5, 1-40133 Bologna, Italy (“Licensee”). Licensor and Licensee are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

WHEREAS, Licensor owns or controls certain intellectual property rights with respect to bentracimab (also known as PB2452), a novel recombinant human monoclonal antibody antigen-binding fragment designed to reverse the antiplatelet activity of ticagrelor in the event of major bleeding or when urgent surgery is required.

WHEREAS, certain of the intellectual property relating to the Licensed Compounds and Licensed Product (as defined below) is licensed to Licensor by MedImmune Limited pursuant to a license agreement dated November 21, 2017, as amended pursuant to an amendment agreement dated January 9, 2020 (collectively, the “MedImmune License”) and the Licensed Product is subject to a co-development Agreement dated January 9, 2020 between Licensor and SFJ Pharmaceuticals X Limited (the “SFJ Agreement”).

WHEREAS, Licensor wishes to grant to Licensee, and Licensee wishes to take, a license under such intellectual property rights to develop and commercialize Licensed Product in Europe and certain other countries, in each case in accordance with the terms and conditions set forth below.

WHEREAS, Licensor has obtained the acknowledgment of MedImmune (as defined below) pursuant to the MedImmune License.

WHEREAS, Licensor has obtained the consent of SFJ (as defined below) pursuant to the SFJ Agreement as required for Licensor to grant the rights to Licensee and accept the obligations as set out in this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual promises and conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, do hereby agree as follows:

ARTICLE 1
DEFINITIONS

Unless otherwise specifically provided herein, the following terms shall have the following meanings:

1.1.“AAA” has the meaning set forth in Section 11.6.3.

1.2.“Acceptance” means, with respect to a Drug Approval Application filed with the EMA under the centralized procedure that the EMA has accepted such Drug Approval Application for substantive review as evidenced by receipt of notice from the EMA that the Drug Approval Application has passed the relevant technical validation criteria or other evidence that the EMA has commenced its substantive review of such Drug Approval Application.

1.3.“Affiliate” means, with respect to a Person, any Person that, directly or indirectly, through one (1) or more intermediaries, controls, is controlled by or is under common control with such first Person at any time for so long as such Person controls, is controlled by or is under common control with such first Person. For purposes of this definition, “control” and, with correlative meanings, the terms “controlled by” and “under common control with” means: (a) the possession, directly or indirectly, of the power to direct the management or policies of a business entity, whether through the ownership of voting securities, by contract relating to voting rights or corporate governance or otherwise; or (b) the ownership, directly or indirectly, of more than fifty percent (50%) of the voting securities or other ownership interests of a business entity (or, with respect to a limited partnership or other similar entity, its general partner or controlling entity).

1.4.“Agreement” has the meaning set forth in the preamble hereto.

1.5.“Alliance Manager” has the meaning set forth in Section 3.1.

1.6.“Anti-Corruption Laws” means the U.S. Foreign Corrupt Practices Act, as amended, the UK Bribery Act 2010, as amended, and any other applicable anti-corruption laws and laws for the prevention of fraud, racketeering, money laundering or terrorism.

1.7.“[***]” has the meaning set forth in Section 3.3.3(c)

1.8.“Applicable Law” means applicable laws, rules and regulations, including any rules, regulations, guidelines or other requirements of the Regulatory Authorities, that may be in effect from time to time, including the FFDCA, the PHSA and the Anti-Corruption Laws.

1.9.“Arbitration Notice” has the meaning set forth in Section 11.6.2.

1.10.“Arbitrators” has the meaning set forth in Section 11.6.3.

1.11.“Assigned Regulatory Documentation” has the meaning set forth in Section 4.3.1(a).

1.12.“AstraZeneca Product” means any drug product containing the Ticagrelor Compound, including any such products sold, offered for sale or distributed by MedImmune or any of its Affiliates, licensees or successors-in-interest.

1.13.“AstraZeneca Product Improvements” means any invention, discovery, development or modification with respect to the AstraZeneca Product or relating to the

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Exploitation thereof, whether or not patented or patentable, including any enhancement in the efficiency, operation, manufacture, ingredients, preparation, presentation, formulation, means of delivery or dosage of the AstraZeneca Product, any discovery or development of any new or expanded methods of treatment, use or indications for the AstraZeneca Product or any discovery or development that improves the stability, safety or efficacy of the AstraZeneca Product, in each case that are conceived, discovered, developed or otherwise made by or on behalf of one or both of the Parties or their Affiliates, or in the case of Licensee or its Affiliates, its or their Sublicensees (including by its or their Third Party contractors) under or in connection with this Agreement or the conduct of any activities hereunder, including in the case of Licensee or its Affiliates or any of its or their Sublicensees (or its or their Third Party contractors), in connection with any Exploitation of any Licensed Compound or Licensed Product.

1.14.“AstraZeneca Product Know-How” means: (a) to the extent owned or controlled by MedImmune or any of its Affiliates, Information related to the AstraZeneca Product or AstraZeneca Product Improvements or the Exploitation thereof; and (b) Information related to the AstraZeneca Product or AstraZeneca Product Improvements or the Exploitation thereof that, in each case, is generated by or on behalf of Licensee or its Affiliates or any of its or their Sublicensees, in connection with any Exploitation of any Licensed Compound or Licensed Product, other than any such Information that: (i) has been published by MedImmune or any of its Affiliates and is not claimed by a Valid Claim of a Patent owned or Controlled by MedImmune or any of its Affiliates; or (ii) has been published by a Third Party (other than a Sublicensee) that did not receive such Information directly or indirectly from Licensee or any of its Affiliates or Sublicensees and did not generate such Information on behalf of Licensee or any of its Affiliates or Sublicensees.

1.15.“AstraZeneca Product Patents” means any Patent that claims AstraZeneca Product Know-How or otherwise claims any AstraZeneca Product Improvement or the Exploitation thereof.

1.16.“AstraZeneca Product References” means any and all references to, mentions of or claims with respect to the AstraZeneca Product (including any and all references to, mentions of or claims with respect to the Ticagrelor Compound).

1.17.“Auditor” has the meaning set forth in Section 5.9.

1.18.“Biosimilar Filer” has the meaning set forth in Section 6.3.6.

1.19.“Biosimilar Product” means, with respect to a particular Licensed Product in a particular country in the Territory, any pharmaceutical product that (a) is claimed to be interchangeable with such Licensed Product or otherwise references or relies on the prior approval (or the safety or efficacy data submitted in support of the prior approval) of such Licensed Product to support a Drug Approval Application submitted under Section 351(k) of the PHSA or any corresponding foreign application in the Territory; (b) is approved for sale for at least one indication that is the same as an indication for which the Licensed Product is approved for sale in such country; and (c) is sold in such country by a Third Party that is not a direct or indirect sublicensee of Licensee or its Affiliates.

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1.20.“Biosimilar Regulations” means Section 351 of the PHSA, Article 10 of EU Directive 2001/83/EC, and equivalent laws and regulations in other countries or jurisdictions.

1.21.“BioVectra” means BioVectra Inc, a corporation organized under the laws of Prince Edward Island, Canada.

1.22.“BLA” means a biologics license application (within the meaning of 21 C.F.R. 601.2) filed with the FDA seeking Regulatory Approval to market and sell any Licensed Product as a biologic in the United States.

1.23.“Bleeding Indication” means the Indication for the Licensed Product for the reversal of the antiplatelet effects of ticagrelor in patients with uncontrolled major or life-threatening bleeding.

1.24.“BPCI Act” means the Biologics Price Competition and Innovation Act of 2009, Public Law 111-148, title VII, subtitle A, as may be amended from time to time, together with any rules, regulations and requirements promulgated thereunder (including all additions, supplements, extensions and modifications thereto).

1.25.“Breaching Party” has the meaning set forth in Section 10.2.1(a).

1.26.“Brilinta Competing Product” means any P2Y12 receptor antagonist, other than the AstraZeneca Product or Generic Ticagrelor Product.

1.27.“Business Day” means a day other than a Saturday or Sunday or a day on which banking institutions in New York, New York, United States or Bologna, Italy are permitted or required to be closed.

1.28.“Calendar Quarter” means each successive period of three (3) calendar months commencing on January 1, April 1, July 1 and October 1, except that the first Calendar Quarter of the Term shall commence on the Effective Date and end on the day immediately prior to the first to occur of January 1, April 1, July 1 or October 1 after the Effective Date and the last Calendar Quarter shall end on the last day of the Term.

1.29.“Calendar Year” means each successive period of twelve (12) calendar months commencing on January 1 and ending on December 31, except that the first Calendar Year of the Term shall commence on the Effective Date and end on December 31 of the year in which the Effective Date occurs and the last Calendar Year of the Term shall commence on January 1 of the year in which the Term ends and end on the last day of the Term.

1.30.“Combination Product” means a pharmaceutical product that is comprised of or contains a Licensed Compound as an active ingredient together with one (1) or more other active ingredients (other than any active ingredient that is proprietary to Licensor but that is not a Compound) and is sold either as a fixed dose/unit or as separate doses/units in a single package.

1.31.“Commercialization” means, in respect of a Licensed Compound or Licensed Product, any and all activities directed to the preparation for sale of, offering for sale of or sale of

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such product, including activities related to marketing, promoting, distributing and importing such product and interacting with Regulatory Authorities regarding any of the foregoing. When used as a verb, “to Commercialize” and “Commercializing” means to engage in Commercialization and “Commercialized” has a corresponding meaning. For clarity, Commercialization does not include Manufacturing.

1.32.“Commercialization Dispute” has the meaning set forth in Section 4.4.6.

1.33.“Commercialization Plan” has the meaning set forth in Section 4.4.4.

1.34.“Commercially Reasonable Efforts” means, with respect to the performance of Development or Commercialization activities with respect to a Licensed Compound or a Licensed Product by a Party under this Agreement, the carrying out of such activities in a sustained and diligent manner and using efforts and resources comparable to the efforts and resources commonly used by biopharmaceutical companies of a size and with resources or access to resources similar to that of such Party, for high-priority compounds or products of such companies at a similar stage in development or product life, taking into account issues of patent coverage, measures of relative safety and efficacy, product profile, the competitiveness of the marketplace, the proprietary position of such Licensed Product, the regulatory structure involved and other relevant technical, legal, scientific and medical considerations. Subject to the foregoing, with respect to efforts to Develop or Commercialize a Licensed Product in the Territory, “Commercially Reasonable Efforts”:

(a)shall be determined on a Market-by-Market basis, without regard to the particular circumstances of the relevant Party, including any other product opportunities of the relevant Party and without regard to any payments owed by Licensee to Licensor under this Agreement; and

(b)requires with respect to a particular task or activity in making, using, selling, offering for sale, importing, exporting, developing (including seeking regulatory approvals or applicable pricing or reimbursement approvals) or otherwise commercializing the Licensed Product that a Party: (i) promptly assign responsibility for such task or activity to specific employee(s) who are held accountable for progress and monitor such progress on an on-going basis; (ii) set and consistently seek to achieve specific and meaningful objectives for carrying out such task or activity; and (iii) make and implement decisions and allocate resources designed to advance progress with respect to such objectives in accordance with established timeline, provided, however, that, to the extent that the performance of a Party’s obligations hereunder is adversely affected by the other Party’s breach in performing its obligations hereunder, the impact on the first Party of such performance failure by the other Party will be taken into account in determining whether the first Party has used its Commercially Reasonable Efforts to perform any such affected obligations.

1.35.“Commercial Viability Issue” means, with respect to the Licensed Product in the EU Market, the existence of objective circumstances arising after the Effective Date with respect to the EU Market (other than a Safety/Efficacy Issue), as a result of which a company in the

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biopharmaceutical industry would reasonably be expected to elect not to continue to fund or conduct the Development or Commercialization of the Licensed Product for the EU Market in light of the overall business case with respect to the Licensed Product in the EU Market, taking into account relevant commercial factors, including the additional time and Development costs required to obtain or maintain Regulatory Approval in the EU Market, the product profile, the competitiveness of the marketplace and the proprietary position of the Licensed Product and other commercial factors customarily considered in a business case analysis (e.g., forecasted sales volumes, net selling price per unit, cost of goods per unit, commercialization costs and other data indicating anticipated revenues in the EU Market, as applicable).

1.36.“Competing Product” means any agent intended to neutralize, abrogate or reverse the antiplatelet activity of the Ticagrelor Compound, including any anti-ticagrelor antibody or antibody fragment.

1.37.“Conditional Regulatory Approvals” means conditional Regulatory Approval of the Licensed Product that is subject to any specific obligations as set forth in the Commission Regulation (EC) No 507/2006 or its equivalent in the UK.

1.38.“Confidential Information” has the meaning set forth in Section 7.1.

1.39.“Control” means, with respect to any item of Information, Regulatory Documentation, Technical Documentation, material, Patent or other intellectual property right, and subject to Section 11.3, possession by a Person of the right, whether directly or indirectly and whether by ownership, license or otherwise (other than by virtue of any license granted to a Party pursuant to this Agreement), to grant a license, sublicense or other right (including the right to reference to Regulatory Documentation) to or under such Information, Regulatory Documentation, material, Patent or other intellectual property right as provided for herein without violating the terms of any agreement with any Third Party.

1.40.“Development” means, in respect of a Licensed Compound or Licensed Product, all activities related to research, pre-clinical and other non-clinical testing, test method development and stability testing, toxicology, formulation, qualification and validation, quality assurance/quality control, clinical studies, statistical analysis and report writing, the preparation and submission of Drug Approval Applications, regulatory affairs with respect to the foregoing and all other activities necessary or reasonably useful or otherwise requested or required by a Regulatory Authority as a condition or in support of obtaining or maintaining a Regulatory Approval for such Licensed Compound or Licensed Product. When used as a verb, “Develop” means to engage in Development. For clarity, Development (a) does not include Manufacturing or any activities provided in support thereof; and (b) in respect of Licensor, includes the activities set out in Section 4.3.1 (a), and in respect of Licensee, includes the activities set out in Section 4.3.1(b) and Section 4.3.2.

1.41.“Development Plan” means the written plan for the Development of the Licensed Product, which has been agreed by SFJ and Licensor and a copy of which is set out in Schedule 1.41, and which will be subject to amendment as set forth in Section 4.2.6.

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1.42.“Dispute” has the meaning set forth in Section 11.6.1.

1.43.“Dispute Auditor” has the meaning set forth in Section 5.10.

1.44.“Distributor” means a Third Party distributor of Licensed Product appointed or contracted by Licensee or any of its Affiliates or any of its or their respective Sublicensees in a particular country of the Territory, in circumstances where such Third Party purchases its requirements of Licensed Product from Licensee or its Affiliates or any of its or their respective Sublicensees, which Third Party distributor either: (a) has no royalty or other payment obligation to Licensee or any of its Affiliates or any of its or their respective Sublicensees that is calculated based on amounts invoiced or received by or on behalf of such Third Party distributor (or any of its Affiliates) for sales of Licensed Product in such country; or (b) does not take title to Licensed Product, does not invoice Licensed Product sales to Third Party customers in such country, and is responsible only for inventory management and distribution on behalf of Licensee or any of its Affiliates or any of its or their respective Sublicensees in such country.

1.45.“Dollars” or “$” means United States Dollars.

1.46.“Drug Approval Application” means a BLA or any corresponding foreign application in the Territory, including, with respect to a country in the European Union, a marketing authorization application filed with the EMA pursuant to the centralized approval procedure or with the applicable Regulatory Authority of a country in the European Union with respect to the mutual recognition, decentralized approval procedure or any other national approval.

1.47.“Effective Date” has the meaning set forth in the preamble hereto.

1.48.“EMA” means the European Medicines Agency and any successor agency thereto.

1.49. “EU Market” means all countries in the European Union taken as a whole.

1.50.“European Union” or “EU”means the economic, scientific and political organization of European Union member states as it may be constituted from time to time, specifically including any territory that is a European Union member state as of the Effective Date, whether or not such territory is a participating member as of the applicable time.

1.51.“Euro” or “€” means Euro, the official currency of the Eurozone.

1.52.“Excluded Compound” means any anti-ticagrelor antibody or antibody fragment other than the Licensed Compound.

1.53.“Exclusive Period” means (a) in the case of [***], the period of [***], and (b) in the case of [***], the period of [***].

1.54.“Exercise Notice” has the meaning set forth in Section 3.3.3(d).

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1.55. “Exploit” means, in respect of a compound or product, to use, sell, have sold or offer for sale, including to develop (including Develop), make, have made, manufacture, (including Manufacture and have Manufactured), commercialize (including Commercialize), register, hold or keep (whether for disposal or otherwise), have used, import, export, transport, distribute, promote, market or have sold or otherwise dispose of such compound or product. “Exploitation”means the act of Exploiting a compound or product.

1.56.“FDA” means the United States Food and Drug Administration and any successor agency thereto.

1.57.“FFDCA”means the United States Food, Drug, and Cosmetic Act, as amended from time to time, together with any rules, regulations and requirements promulgated thereunder (including all additions, supplements, extensions and modifications thereto).

1.58.“Field” means any use or purpose, including the treatment, palliation, diagnosis or prevention of any human disorder or condition.

1.59.“[***]” has the meaning set forth in Section 5.2.2.

1.60. “First Commercial Sale” means, with respect to a Licensed Product and a country in the Territory, the first sale for monetary value for use or consumption by the end user of such Licensed Product in such country after approval of a Drug Approval Application for such Licensed Product has been obtained in such country.

1.61.“GAAP” means, with respect to a Party or its Affiliates or its or their sublicensees, United States generally accepted accounting principles, International Financial Reporting Standards or such other similar national standards as such Party, Affiliates or its or their sublicense adopts, in each case, consistently applied.

1.62.“Generic Ticagrelor Product” means an oral formulation of the Ticagrelor Compound that is (a) sold, offered for sale or distributed under: (i)  in the EU, a marketing authorization for a generic medicinal product granted in accordance with Article 10 of Directive 2001/83/EC or (ii) in any other country or jurisdiction, an equivalent of provisions set forth in clause (i) and (b) approved in the applicable country or jurisdiction for at least one of the indications for which the AstraZeneca Product is approved in such country or jurisdiction. For purposes of this definition, references to AstraZeneca Product exclude Generic Ticagrelor Products.

1.63.“GlobalCommercial Viability Issue” means, with respect to the Licensed Product, that a Commercial Viability Issue exists in both the United States and the EU Market.

1.64.“Global Safety/Efficacy Issue” has the meaning set forth in Section 1.136.

1.65.“Governmental Authority” means any federal, state, national, state, provincial or local government, or political subdivision thereof, or any multinational organization or any authority, agency or commission entitled to exercise any administrative, executive, judicial,

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legislative, police, regulatory or taxing authority or power, any court or tribunal (or any department, bureau or division thereof, or any governmental arbitrator or arbitral body).

1.66.“IND” means (a) an investigational new drug application filed with the FDA for authorization to commence clinical studies and its equivalent in other countries or regulatory jurisdictions and (b) all supplements and amendments that may be filed with respect to the foregoing.

1.67.“Improvements” means a new improvement, modification or development, whether patentable or not, of [***].

1.68.“Indemnification Claim Notice” has the meaning set forth in Section 9.3.1.

1.69.“Indemnified Party” has the meaning set forth in Section 9.3.1.

1.70.“Independent Expert” has the meaning set forth in Section 10.2.3(c).

1.71.“Indication” means the diagnosis, treatment or prevention of a discrete, clinically recognized form of disease, condition or circumstance. For clarity, treatment of different subpopulations within a population of patients having a disease, condition or circumstance shall not be treated as separate Indications for the purposes of this Agreement (e.g. front-line treatment, relapsed refractory treatment and maintenance treatment of the same disease, condition or circumstance shall not be considered different Indications).

1.72.“Information” means technical or scientific know-how, trade secrets, methods, processes, formulae, designs, specifications and data, including: biological, chemical, pharmacological, toxicological, pre-clinical, clinical, safety, manufacturing and quality control data and assays; in each case, whether or not confidential, proprietary, patented or patentable.

1.73.“Infringement” has the meaning set forth in Section 6.3.1.

1.74.“Invention” means any invention, whether or not patentable, made, conceived, generated or reduced to practice in the course or as a result of the conduct of activities conducted pursuant to this Agreement ([***]).

1.75.“Knowledge” means, with respect to Licensor, the actual knowledge, without any duty to conduct any investigation, with respect to such facts and information of the following: (a) Licensor’s patent attorney who, as of the Effective Date, is engaged in the development program with respect to MEDI2452 and (b) Licensor’s Vice President and Head of Legal.

1.76.“Licensed Compound” means the anti-ticagrelor antibody fragment product known as bentracimab (also known as PB2452 or MEDI2452), as further defined by the protein sequence set forth in Schedule 1.76, excluding Excluded Compound.

1.77.“Licensed Know-How” means the Information Controlled by Licensor and its Affiliates as of the Effective Date or at any time during the Term that is necessary for the Development, Manufacture (only to the extent permitted under the Supply Agreement) or

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Commercialization of the Licensed Compound or Licensed Product in the Field in the Territory, including the Technical Documentation, but excluding any AstraZeneca Product Know-How (whether or not included or disclosed in Information set forth on Schedule 1.77 or provided by Licensor to Licensee hereunder). For clarity, Licensed Know-How excludes any research, discovery or development tools or technology, including Information with respect to any such research, discovery or development tools or technology used by MedImmune in relation to (a) the Licensed Compound; or (b) any other anti-ticagrelor antibody or antibody fragment that is covered or claimed by the Licensed Patents.

1.78.“Licensed Patents” means (a) all Patents in the Territory that are Controlled by Licensor and its Affiliates as of the Effective Date or at any time during the Term that claim the Licensed Compound or Licensed Product; and (b) any Patents filed with MedImmune’s consent pursuant to the last two sentences of Section 6.1.2, but in each case excluding any AstraZeneca Product Patents. Licensed Patents existing as of the Effective Date are set forth on Schedule 1.78.

1.79.“Licensed Product” means any product that is comprised of or contains a Licensed Compound, alone or in combination with one (1) or more other active ingredients (other than any active ingredient that is proprietary to Licensor but is not a Licensed Compound), in any and all forms, presentations, dosages and formulations.

1.80.“Licensed Product Agreement” means, with respect to a Licensed Product, any agreement entered into by and between Licensee or any of its Affiliates or its or their Sublicensees, on the one hand, and one (1) or more Third Parties, on the other hand, relating to the Development or Commercialization of such Licensed Product in the Field in the Territory, including (a) any agreement pursuant to which Licensee, its Affiliates or its or their Sublicensees receives any license or other rights to Develop or Commercialize such Licensed Product; (b) clinical trial agreements with respect to such Licensed Product, (c) contract research organization agreements relating to such Licensed Product, and (d) service agreements relating to such Licensed Product.

1.81.“Licensed Trademarks”means any Trademarks that are Controlled by Licensor and its Affiliates as of the Effective Date or at any time during the Term and used by Licensor or its Affiliates in connection with the Commercialization of the Licensed Product.

1.82.“Licensee” has the meaning set forth in the preamble hereto.

1.83.“Licensee Corporate Names” means the Trademarks, names and logos of Licensee identified on Schedule 1.83 and such other Trademarks, names and logos as Licensee may designate in writing from time to time.

1.84.“Licensee Indemnitees” has the meaning set forth in Section 9.2.

1.85.“Licensee Know-How” means [***]:

(a)all Information relating to [***]; and

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(b)without limitation to clause (a), all Information relating to [***] that (i) [***] or (ii) both (A) [***] and (B) [***];

but excluding in each case ((a) and (b)) Licensed Know-How, Licensed Patents, AstraZeneca Product Know-How, and any Information to the extent covered or claimed by the Licensed Patents.

1.86.“Licensee Improvements” means Licensee Patents and Licensee Know-How.

1.87.“Licensee Patents” means [***]:

(a)all Patents relating to [***]; and

(b)without limitation to clause (a), any Patent relating to [***];

but excluding in each case ((a) and (b)) Licensed Know-How, Licensed Patents and AstraZeneca Product Patents.

1.88.“Licensee Pharmacovigilance Agreement” has the meaning set forth in Section 4.3.6(b).

1.89.“Licensee Regulatory Documentation” means Regulatory Documentation Controlled by Licensee or any of its Affiliates with respect to a Licensed Compound or a Licensed Product at any time during the Term.

1.90.“Licensor Corporate Names” means the Trademarks, names and logos of Licensor identified on Schedule 1.90 and such other Trademarks, names and logos as Licensor may designate by notice in writing to Licensee from time to time.

1.91.“Licensor Improvements” has the meaning set forth in Section 6.1.5

1.92.“[***]” has the meaning set forth in Section 6.1.5(c).

1.93.“[***]” has the meaning set forth in Section 6.1.5(d).

1.94.“[***]” has the meaning set forth in Section 6.1.5(e).

1.95.“[***]” has the meaning set forth in Section 6.1.5.

1.96.“[***]” has the meaning set forth in Section 6.1.5(d).

1.97.“Licensor Indemnitees” has the meaning set forth in Section 9.1.

1.98. “Losses” has the meaning set forth in Section 9.1.

1.99.“Manufacture” and “Manufacturing” means, in respect of a Licensed Compound or Licensed Product, all activities related to the production, manufacture, processing, filling, finishing, packaging, labeling, shipping and holding of such Licensed Compound or

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Licensed Product or any intermediate thereof, including process development, process qualification and validation, scale-up, pre-clinical, clinical and commercial manufacture and analytic development, product characterization, stability testing, quality assurance and quality control.

1.100.“Market” means (i) the EU Market; and/or (ii) all the other countries in the Territory that are outside the EU Market.

1.101.“Market-Specific Safety/Efficacy Issue” has the meaning set forth in Section 1.136.

1.102.“Material Anti-Corruption Law Violation” means a violation by a Party or its Affiliate of an Anti-Corruption Law relating to the subject matter of this Agreement that would, if it were publicly known, have a material adverse effect on the other Party or its Affiliate because of its relationship with such Party.

1.103.“MedImmune” means MedImmune Limited, the upstream licensor of Licensee pursuant to the MedImmune License.

1.104.“MedImmune Corporate Names” means the Trademarks, names and logos of MedImmune identified on Schedule 1.111.98 of the MedImmune License (which is reproduced as Schedule 1.104 of this Agreement) and such other Trademarks, names and logos as MedImmune may designate in writing from time to time pursuant to the MedImmune License.

1.105.“MedImmune License” has the meaning set forth in the preamble hereto.

1.106.“MedImmune Pharmacovigilance Agreement” means that certain pharmacovigilance agreement dated March 23, 2018 entered into between MedImmune and Licensor regarding the exchange of safety information with respect to the Licensed Product and AstraZeneca Product.

1.107.“Negotiation Period” has the meaning set forth in Section 3.3.3(e).

1.108. “Net Sales” means, with respect to a Licensed Product for any period, the gross amount invoiced by Licensee, its Affiliates or its or their Sublicensees (each, a “Selling Party”) to Third Parties (including Distributors) for the sale of a Licensed Product (“Invoiced Sales”) after deduction for:

1.108.1.[***];

1.108.2.[***];

1.108.3.[***];

1.108.4.[***];

1.108.5.[***];

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1.108.6.[***]; and

1.108.7.[***];

provided that, in each case, 1.108.1 through 1.108.7, (a) each such deduction is calculated in a manner consistent with Licensee’s customary practice for pharmaceutical products and consistent with GAAP, (b) each such deduction is directly allocable or apportioned on a good faith and fair basis to Licensed Product, and (c) no amount is deducted more than once.

Any of the deductions listed above that involves a payment by a Selling Party shall be taken as a deduction in the Calendar Quarter in which the payment is accrued by such Selling Party. For purposes of determining Net Sales, a Licensed Product shall be deemed to be sold when invoiced. Sale of a Licensed Product by a Selling Party to another Selling Party for resale by such entity to a Third Party (including Distributors) for use or consumption by the end user shall not be deemed a sale for purposes of this definition of “Net Sales,” provided that the subsequent resale of such Licensed Product to a Third Party (including Distributors) is included in the computation of Net Sales. In addition, transfers or dispositions of Licensed Product as free promotional samples in commercially reasonable amounts, consistent with prevailing pharmaceutical industry standards, or in any patient assistance, test marketing program, named-patient program or compassionate use program (so long as such Licensed Product are provided without charge) and Licensed Product donated to non-profit institutions or government agencies, or used in research, development or regulatory activities, including, without limitation, clinical trials, shall be disregarded in determining Net Sales.

    In the event that a Licensed Product is sold in any country in the form of a Combination Product, Net Sales of such Combination Product for the purpose of determining royalties due hereunder shall be calculated as follows:

(a)where both such Licensed Product containing the applicable Licensed Compound as its sole active pharmaceutical ingredient (“Single-Agent Product”) and product containing only the Other Active(s) in such Combination Product as active pharmaceutical ingredients are sold separately in such country, with respect to a Calendar Quarter, Net Sales shall be calculated by multiplying actual Net Sales of such Combination Product in such country during such Calendar Quarter calculated pursuant to the foregoing definition of “Net Sales” by [***]; provided that the invoice price in a country for each Single-Agent Product that contains only the Licensed Compound(s) and each product that contains solely the Other Active(s) included in the Combination Product shall be for a quantity comparable to that used in such Combination Product and of substantially the same class, purity and potency;

(b)if the Single-Agent Product is sold in such country, but none of the Other Active(s) is sold separately in such country, with respect to a Calendar Quarter, Net Sales shall be calculated by multiplying actual Net Sales of such Combination Product in such

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country during such Calendar Quarter calculated pursuant to the foregoing definition of “Net Sales” by [***];

(c)if no Single-Agent Product is sold in such country, but product containing the Other Active(s) in such Combination Product are sold separately in such country, with respect to a Calendar Quarter, Net Sales shall be calculated by multiplying actual Net Sales of such Combination Product in such country during such Calendar Quarter calculated pursuant to the foregoing definition of “Net Sales” by [***]; and

(d)if neither Single-Agent Product nor product containing the Other Active(s) in such Combination Product as its sole active ingredient(s) is sold separately in such country, the Parties [***].

    In the case of pharmacy incentive programs, hospital performance incentive programs, chargebacks, disease management programs, similar programs or discounts on portfolio product offerings, all rebates, discounts and other forms of reimbursements [***]; provided that (a) any such allocation to a Licensed Product shall be done in accordance with Applicable Law, including any price reporting laws, rules and regulations and (b) subject to clause (a), all such rebates, discounts and other forms of reimbursements [***].

Subject to the above, Net Sales shall be calculated in accordance with the standard internal policies and procedures of Licensee, its Affiliates or its or their Sublicensees, which must be in accordance with GAAP.

1.109.“Non-Breaching Party” has the meaning set forth in Section 10.2.1(a).

1.110.“Notice Period” means the Section 10.2.1(a) Notice Period or the Section 10.2.1(b) Notice Period, as applicable.

1.111.“Option” has the meaning set forth in Section 3.3.3.

1.112.“Option Period” has the meaning set forth in Section 3.3.3(d).

1.113.“Other Active” means any active pharmaceutical ingredient contained in a Combination Product that is not a Licensed Compound.

1.114.“Other Adverse Event” has the meaning set forth in Section 4.3.6(i).

1.115.“Party” and “Parties” have the meaning set forth in the preamble hereto.

1.116.“Patents” means: (a) all national, regional and international patents and patent applications, including provisional patent applications; (b) all patent applications filed either from such patents, patent applications or provisional applications or from an application claiming priority from either of these, including divisionals, continuations, continuations-in-part, provisionals, converted provisionals and continued examination applications; (c) any and all patents that have issued or in the future issue from the foregoing patent applications ((a) and (b)),

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including utility models, petty patents, innovation patents and design patents and certificates of invention; (d) any and all extensions or restorations by existing or future extension or restoration mechanisms, including revalidations, reissues, re-examinations and extensions (including any supplementary protection certificates and the like) of the foregoing patents or patent applications ((a), (b) and (c)); and (e) any similar rights, including so-called pipeline protection or any importation, revalidation, confirmation or introduction patent or registration patent or patent of additions to any of such foregoing patent applications and patents.

1.117.“Payment” has the meaning set forth in Section 5.6.1.

1.118.“Permitted Competing Product” has the meaning set forth in Section 11.4.

1.119.“Person” means an individual, sole proprietorship, partnership, limited partnership, limited liability partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture or other similar entity or organization, including a government or political subdivision, department or agency of a government.

1.120.“Phase III Clinical Trial” means, with respect to the Licensed Product, a human clinical trial that would satisfy the definition of “Phase 3” set forth in 21 C.F.R. 312.21(c) (as amended or any replacement thereof), regardless of where such trial is conducted.

1.121.“PHSA” means the Public Health Service Act as set forth at 42 U.S.C. Chapter 6A, as may be amended from time to time, together with any rules, regulations and requirements promulgated thereunder (including all additions, supplements, extensions and modifications thereto).

1.122.“Product Labeling”means, with respect to a Licensed Product in a country in the Territory, (a) the Regulatory Authority-approved full prescribing information for such Licensed Product for such country, including any required patient information and (b) all labels and other written, printed or graphic matter upon a container, wrapper or any package insert utilized with or for such Licensed Product in such country.

1.123.“Product Positioning Principles” have the meaning set forth in Section 4.8.

1.124. “Promotional Materials” means all written, printed, electronic or graphic material created, utilized or distributed by Licensee or any of its Affiliates or its or their Sublicensees or Third Party contractors for the promotion, sale or marketing of Licensed Product.

1.125.“Proposed Activities” has the meaning set forth in Section 3.3.

1.126. “Redacted Agreement” has the meaning set forth in Section 7.2.7.

1.127.“Regulator-Requested Trial” means any clinical trial that EMA and/or UK MHRA requires Licensor to conduct in the Territory with respect to the Licensed Product, which

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is subsequent or ancillary to, or in conjunction with, the Phase III Clinical Trial as a condition of the grant by both EMA and UK MHRA of an Unconditional Regulatory Approval.

1.128.“Regulatory Approval” means, with respect to a particular Licensed Product and a particular country in the Territory, any and all approvals (including approvals of Drug Approval Applications, Unconditional Regulatory Approvals or Conditional Regulatory Approvals), licenses, registrations or authorizations of any Regulatory Authority necessary to commercially distribute, sell or market such Licensed Productin such country.

1.129.“Regulatory Assignment Date” means the date on which the Assigned Regulatory Documentation is assigned by Licensor to Licensee in accordance with Section 4.2.4.

1.130. “Regulatory Authority” means any applicable supra-national, federal, national, regional, state, provincial or local regulatory agencies, departments, bureaus, commissions, councils or other government entities regulating or otherwise exercising authority with respect to the Exploitation of any Licensed Compound or Licensed Product in the Territory, including the EMA in the European Union and the UK MHRA.

1.131.“Regulatory Documentation” means: all (a) applications (including all INDs and Drug Approval Applications), registrations, licenses, authorizations and approvals (including Regulatory Approvals); (b) correspondence and reports submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority) and all supporting documents with respect thereto, including all adverse event files and complaint files; and (c) pre-clinical, clinical and other data contained or relied upon in any of the foregoing; in each case ((a), (b) and (c)) relating to any Licensed Compound or Licensed Product.

1.132.“Regulatory Documentation Assignment Date” has the meaning set forth in Section 4.3.1(a).

1.133. “Regulatory Exclusivity Period” means, with respect to a Licensed Product in a country in the Territory, any period of exclusivity (other than Patent exclusivity) granted or afforded by Applicable Law or by a Regulatory Authority in such country that confers exclusive marketing rights with respect to such Licensed Product in such country.

1.134.“Representatives” has the meaning set forth in Section 8.4.

1.135.“Royalty Term” means, with respect to each Licensed Product and each country in the Territory, the period beginning on the date of the First Commercial Sale of such Licensed Product in such country and ending on the latest to occur of (a) the tenth (10th) anniversary of the First Commercial Sale of such Licensed Product in such country, (b) the expiration of the last-to-expire Licensed Patent covering the manufacture, use or sale of such Licensed Product in such country, and (c) the expiration of Regulatory Exclusivity Period, if any, for such Licensed Product in such country.

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1.136.“Safety/Efficacy Issue” means, with respect to a Licensed Product: (a) a Regulatory Authority or safety data review board for the clinical trials of such Licensed Product has required (i) termination or suspension of all clinical trials of such Licensed Product in a country due to safety issues or (ii) following approval of a Drug Approval Application for a Licensed Product in a country, a Regulatory Authority withdraws such approval in such country due to safety issues, in each case ((i) and (ii)) for reasons related to a Licensed Compound and not, for example, due to Other Actives contained in such Licensed Product or to Manufacturing-related deficiencies or defects (in either case ((i) or (ii)), a “Market-Specific Safety/Efficacy Issue” with respect to the applicable country); or (b) it is reasonably determined that (i) the medical risk/benefit of such Licensed Product is so unfavorable that it would be incompatible with the welfare of patients to Develop or Commercialize (or to continue to Develop or Commercialize) such Licensed Product or (ii) the efficacy of such Licensed Product, as evidenced by the ability of a Licensed Compound to bind to or inactivate antiplatelet efficacy of the Ticagrelor Compound or its active metabolite, is so minimal that it would not be commercially reasonable to continue to Develop such Licensed Product, in each case ((i) and (ii)) for reasons related to a Licensed Compound and not, for example, due to Other Actives contained in such Licensed Product or to Manufacturing-related deficiencies or defects (in either case ((i) or (ii)), a “Global Safety/Efficacy Issue”).

1.137.“Sale Transaction” has the meaning set forth in Section 11.3.1.

1.138.“Section 10.2.1(a) Notice Period” has the meaning set forth in Section 10.2.1(a).

1.139.“Section 10.2.1(a) Termination Notice” has the meaning set forth in Section 10.2.1(a).

1.140.“Section 10.2.1(b) Notice Period” has the meaning set forth in Section 10.2.1(b).

1.141.“Section 10.2.1(b) Termination Notice” has the meaning set forth in Section 10.2.1(b).

1.142.“Section 10.2.3 Matter” has the meaning set forth in Section 10.2.3(a).

1.143.“Senior Officer” means, with respect to each of Licensor and Licensee, its respective Chief Executive Officer.

1.144.“Serious Adverse Event” has the meaning set forth in Section 4.3.6(h).

1.145.“SFJ” means SFJ Pharmaceuticals X, Limited.

1.146.“SFJ Agreement” has the meaning set forth in the preamble hereto.

1.147.“SFJ Pharmacovigilance Agreement” means that certain pharmacovigilance agreement dated March 20, 2020 entered into between SFJ and Licensor regarding the exchange of safety information with respect to the Licensed Product and AstraZeneca Product.

1.148.“Spontaneous Adverse Event” has the meaning set forth in Section 4.3.6(f).

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1.149.“Strategic Transaction” has the meaning set forth in Section 11.4.

1.150.“Sublicense” means a sublicense under the grants in Section 2.1.

1.151.“Sublicensee” means a Third Party that is granted a Sublicense, but excluding any Distributor.

1.152.“Supply Agreement” has the meaning set forth in Section 4.1.2.

1.153.“Supply Effective Date” means the date on which the first Licensed Product is supplied by Licensor to Licensee pursuant to the Supply Agreement.

1.154.“Surgical Use Indication” means the Indication for the Licensed Product for the reversal of the antiplatelet effects of ticagrelor in patients requiring urgent surgery or an invasive procedure.

1.155.“Technical Documentation” means technical documents, pharmacovigilance database and regulatory documentation (including, without limitation, the Assigned Regulatory Documentation, clinical and non-clinical data associated with the Licensed Compound and Licensed Product) as necessary to Develop, use, seek Regulatory Approval, sell, have sold, offer for sale and import the Licensed Product in the Field in the Territory.

1.156.“Term” has the meaning set forth in Section 10.1.

1.157.“Terminated Territory” means each country or Market with respect to which this Agreement is terminated by Licensor pursuant to Section 10.2.1(b) or by Licensee pursuant to Section 10.2.3(d)(i), Section 10.2.3(d)(iii) or Section 10.2.4, or if this Agreement is terminated in its entirety, the entire Territory.

1.158.“Termination Notice” means the Section 10.2.1(a) Termination Notice or the Section 10.2.1(b) Termination Notice, as applicable.

1.159.“Territory”means the following countries and jurisdictions: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain Sweden, Iceland, Liechtenstein, Norway (including any other countries and jurisdictions that may join from time to time the European Union and/or the European Economic Area unless the extension of the Territory to any such country or jurisdiction conflicts with any Third Party agreements entered into by Licensor at the time such country joins the European Union and/or the European Economic Area), the United Kingdom (“UK”), Switzerland, Albania, Andorra, Bosnia and Herzegovina, Kosovo, Monaco, Moldavia, Montenegro, North Macedonia, Republic of San Marino, Serbia, State of Vatican City, Russia, Ukraine, Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, and Uzbekistan, other than the Terminated Territory.

1.160.“Third Party”means any Person other than Licensor, Licensee and their respective Affiliates.

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1.161.“Third Party Acquirer” has the meaning set forth in Section 11.3.1.

1.162.“Third Party Claims” has the meaning set forth in Section 9.1.

1.163.“Third Party Infringement Claim” has the meaning set forth in Section 6.4.

1.164.“Third Party Trademark Infringement” has the meaning set forth in Section 6.6.4.

1.165.“Third Party Trademark Claim” has the meaning set forth in Section 6.6.5.

1.166.“Ticagrelor Compound” means (1S,2S,3R,5S)-3-[7-{[(1R,2S)-2-(3,4-difluorophenyl)cyclopropyl]amino}-5-(propylthio)-3H-[1,2,3]-triazolo[4,5-d]pyrimidin-3-yl]-5-(2-hydroxyethoxy)cyclopentane-1,2-diol.

1.167.“Trademark” means any word, name, symbol, color, shape, designation or any combination thereof, including any trademark, service mark, trade name, brand name, sub-brand name, trade dress, product configuration rights, program name, delivery form name, certification mark, collective mark, logo, tagline, slogan, design or business symbol, that functions as an identifier of source, origin or quality, whether or not registered, and all statutory and common law rights therein and all registrations and applications therefor, together with all goodwill associated with, or symbolized by, any of the foregoing.

1.168.“Unconditional Regulatory Approval” means unconditional Regulatory Approval of the Licensed Product that is not subject to any specific obligations as set forth in the Commission Regulation (EC) No 507/2006) (or its equivalent in the UK). The Unconditional Regulatory Approval shall include, for example, a standard marketing authorization from the EMA or its equivalent in the UK.

1.169.“UK MHRA” means the Medicines and Healthcare products Regulatory Agency in the United Kingdom and any successor agency thereto.

1.170.“Upstream Agreements” means the MedImmune License, the SFJ Agreement and the Wacker License.

1.171.“United States” or “U.S.” means the United States of America and its territories and possessions (including the District of Columbia and Puerto Rico).

1.172.“Valid Claim” means (a) a claim of any issued and unexpired Patent whose validity, enforceability or patentability has not been affected by (i) irretrievable lapse, abandonment, revocation, dedication to the public or disclaimer or (ii) a holding, finding or decision of invalidity, unenforceability or non-patentability by a court, governmental agency, national or regional patent office or other appropriate body that has competent jurisdiction, such holding, finding or decision being final and unappealable or unappealed within the time allowed for appeal, or (b) a claim of a pending Patent application that was filed and is being prosecuted in good faith and has not been intentionally abandoned without the possibility of reinstatement and that has been pending for less than seven (7) years from the filing date from which such claim

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takes priority. If a claim of a patent application that ceased to be a Valid Claim under clause (b) of the preceding sentence because of the passage of time later issues as a part of a patent within clause (a) of the preceding sentence, then it shall again be considered a Valid Claim effective as of the issuance of such patent.

1.173.“VAT” has the meaning set forth in Section 5.6.3.

1.174.“Wacker AG” means Wacker Chemie AG, a German corporation, which is the parent company of Wacker Biotech.

1.175.“Wacker Biotech” means Wacker Biotech GmbH, a German corporation.

1.176.“Wacker License” means that certain license agreement between Licensor and Wacker Biotech, dated April 1, 2019 as amended by a letter dated February 6, 2020.

1.177.“Wacker Technology” means the technology, the modified E. coli K-12 strain and certain deliverables licensed to Licensor by Wacker Biotech pursuant to the Wacker License.

1.178.“Withholding Taxes” has the meaning set forth in Section 5.6.1.

ARTICLE 2
GRANT OF RIGHTS

2.1.Grants to Licensee. Subject to Sections 2.3, 2.4, and 2.8 and the other terms and conditions of this Agreement, Licensor hereby grants to Licensee an exclusive, (including with regard to Licensor and its Affiliates), royalty-bearing license (including right of reference pursuant to Section 4.3.4 (b)), with the right to grant sublicenses in accordance with Section 2.3, under the Licensed Know-How and Licensed Patents, solely to Develop, use, sell, offer for sale, import and otherwise Commercialize the Licensed Compounds, Licensed Productand, [***]. Subject to the terms of the Supply Agreement, the foregoing license excludes any license or right for Licensee to Manufacture the Licensed Compound and/or Licensed Product, and Licensee shall purchase from Licensor all of Licensee’s (including its Affiliates’ and Sublicensees’) requirements of the Licensed Compound and/or Licensed Product for Development and Commercialization in the Field in the Territory pursuant to the Supply Agreement.

2.2.Grants to Licensor. Subject to terms and conditions of this Agreement, Licensee hereby grants to Licensor and its Affiliates a non-exclusive, royalty-free, irrevocable license (including a right of reference, pursuant to Section 4.3.4(a)), with the right to grant sublicenses through multiple tiers of sublicensees and further rights of reference under Licensee Know-How, Licensee Patents, Assigned Regulatory Documentation and Licensee Regulatory Documentation: (a) to Exploit the AstraZeneca Product and any AstraZeneca Product Improvements anywhere in the world; (b) to perform or exercise Licensor’s obligations or rights under this Agreement anywhere in the world; (c) to Exploit the Licensed Compound and Licensed Product outside the Territory; and (d) to Manufacture the Licensed Compound and Licensed Product anywhere in the world.

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2.3.Sublicenses.

2.3.1.In General. Except as set out below,Licensee shall have the right to grant Sublicenses (or further rights of reference), through multiple tiers of Sublicensees, under the license granted in Section 2.1 (including rights of reference) and Section 2.7, to its Affiliates and Third Parties; provided that (i) any Sublicenses shall be consistent in all material respects with, and expressly made subject to, the terms and conditions of this Agreement and (to the extent applicable) the Wacker License; and (ii) any Sublicenses (or further rights of reference) under the license granted in Section 2.1 that relate to the Wacker Technology (including rights of reference) is subject to Wacker Biotech’s prior written approval in accordance with the Wacker License; provided, however, that the Parties acknowledge that the appointment by Licensee of a distributor for any of the countries in the Territory will not constitute the grant of a sublicense provided that the distribution agreement is for the resale of the Licensed Products and does not include the grant of a license by Licensee to the distributor under the Licensed Know-How or Licensed Patents. Licensee shall cause each of its Affiliates and Sublicensees to comply with the applicable terms and conditions of this Agreement to the same extent as applicable to Licensee hereunder (in each case, regardless of whether a particular term or condition of this Agreement makes express reference to its Affiliates or Sublicensees), including, for clarity, Sections 2.5.1 and 2.5.2 (Exclusivity), Section 4.4.5 (Commercialization Strategy), Section 4.4.6 (Promotional Materials), Section 4.4.6 (Commercialization Disputes), Section 6.1.2 (AstraZeneca Product IP), Section 6.1.8 (Assignment Obligation), Section 7.4 (Public Announcements), Section 7.5 (Publications), Section 10.4.2 (Effect of Termination in its Entirety) and Section 10.4.3 (Effect of Termination in a Terminated Territory). Licensee hereby (a) guarantees the performance of its Affiliates and Sublicensees and the grant of any such sublicense shall not relieve Licensee of its obligations under this Agreement, except to the extent they are satisfactorily performed by such Affiliate or Sublicensee, and (b) waives any requirement that Licensor exhaust any right, power or remedy, or proceed against any Affiliate or Sublicensee for any obligation or performance under this Agreement prior to proceeding directly against Licensee. A copy of any sublicense agreement executed by Licensee pursuant to which Licensee sublicenses any license or rights of reference granted hereunder shall be provided to Licensor within ten (10) Business Days after its execution; provided that the terms of any such sublicense agreement to the extent not pertinent to an understanding of a Party’s obligations or benefits under this Agreement may be redacted.

2.4.Retention of Rights; Limitations Applicable to License Grants.

2.4.1.Retained Rights of Licensor. Notwithstanding anything to the contrary in this Agreement and without limiting any rights granted or reserved to Licensor pursuant to any other term or condition of this Agreement, Licensor hereby expressly retains, on behalf of itself and its Affiliates (and on behalf of its licensors, (sub)licensees and contractors) the exclusive right under the Licensed Know-How and Licensed Patents, in each case for Licensor and its Affiliates (and in the case of (b) below, for MedImmune and its Affiliates) to (a) perform Licensor’s obligations and to exercise their respective

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rights under this Agreement, including the Development of the Licensed Product in the Field in the Territory pursuant to Section 4.2.1, as necessary for Licensor to prepare and file the Drug Approval Applications with the EMA and the UK MHRA pursuant to Section 4.3.1(a), (b) Exploit the AstraZeneca Product in any field (including the Field) anywhere in the world and (c) subject to Section 2.5, Exploit any compound or product other than any Licensed Compound or Licensed Product anywhere in the world, (d) Exploit the Licensed Compound and Licensed Product outside the Territory; and (e) Manufacture the Licensed Compound and Licensed Product anywhere in the world.

2.4.2.No Other Rights Granted by Licensor. Except as expressly provided herein, Licensor grants no other right or license, including any rights or licenses to the Licensed Know-How, the Licensed Patents, Licensed Trademark, Licensor Improvements, the Licensor Corporate Names, the MedImmune Corporate Names, or any other Patent, Trademark or other intellectual property rights not otherwise expressly granted herein. Without limitation to the foregoing, the Parties agree that the rights and licenses granted to Licensee under this Agreement do not include rights or licenses to develop, manufacture or commercialize, or otherwise Exploit, the Ticagrelor Compound or any AstraZeneca Product for any purpose.

2.4.3.No Other Rights Granted by Licensee. Except as expressly provided herein, Licensee grants no other right or license, including any rights or licenses to the Licensee Know-How, Licensee Patents, Licensee Improvements, Assigned Regulatory Documentation, the Licensee Regulatory Documentation or any other Patent, Trademark or other intellectual property rights not otherwise expressly granted herein.

2.5.Licensed Product Exclusivity.

2.5.1.Exclusivity Commitment of Licensee. During the applicable Exclusive Period, Licensee shall not, and shall cause its Affiliates and Sublicensees not to, either by itself or through a Third Party, conduct human clinical trials of, or sell, offer for sale or have sold in the Territory:

(a)any Competing Product (other than a Licensed Compound or Licensed Product) alone or in combination (whether fixed dose or co-packaged) with one (1) or more other active ingredients;

(b)any combination (whether fixed dose or co-packaged) with one (1) or more other active ingredients of Licensed Compound or Licensed Product and a Competing Product;

(c)any agent that is intended as an antidote to, or is intended to neutralize, abrogate or reverse the antiplatelet activity of, (i) any Brilinta Competing Product alone or in combination (whether fixed dose or co-packaged) with one (1) or more other active ingredients or (ii) both the Ticagrelor Compound and a Brilinta Competing Product;

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(d)without limitation to the foregoing, any agent with dual activity as (i) an antidote to, or for use as an agent to neutralize, abrogate or reverse the antiplatelet activity of, the Ticagrelor Compound and (ii) an antidote to, or for use as an agent to neutralize, abrogate or reverse the antiplatelet activity of, any Brilinta Competing Product; or

(e)any Brilinta Competing Product.

2.5.2.Additional Exclusivity Commitment of Licensee. During the Term, none of Licensee, any of its Affiliates or its or their successors or any Sublicensee, directly or indirectly shall Exploit any Excluded Compound or any product containing an Excluded Compound in the Territory. In the event of Licensee’s breach of this Section 2.5.2, without limitation to any claim for damages or other right or remedy of Licensor hereunder or at law or in equity, Licensee shall pay to Licensor, in relation to any such Excluded Compound and any product containing an Excluded Compound or any Exploitation thereof, an amount equal to the milestones and royalties that would have otherwise been payable pursuant to Article 5 of this Agreement as if such Excluded Compound or product was a Licensed Product hereunder and thereunder. For clarity, nothing contained herein is intended to imply, and shall not be construed, to grant to Licensee any license rights to Exploit any Excluded Compound or use any Licensed Compound for any purpose in connection with any product other than a Licensed Product.

2.6.Exclusivity Commitment of Licensor. Subject to Section 4.2.2 and Sections 11.3 and 11.5 or as otherwise expressly provided in this Agreement, during the applicable Exclusive Period, Licensor shall not, and shall cause its Affiliates not to, either by itself or through a Third Party, conduct human clinical trials of, or sell, offer for sale or have sold, or otherwise commercialize any Competing Product in the Territory. Notwithstanding the foregoing, (a) nothing herein is intended to prevent, or shall be construed as preventing, Licensor, MedImmune, or their respective Affiliates from performing their regulatory obligations with respect to the AstraZeneca Product and (b) if with respect to any country, (i) in order to obtain or maintain regulatory approval for the AstraZeneca Product in such country a Regulatory Authority requires that a product that acts as an antidote to, or neutralizes, abrogates or reverses the antiplatelet activity of the Ticagrelor Compound be developed or commercialized in such country, and (ii) Licensee is not actively Developing the Licensed Product in such country, then Licensor, MedImmune or their respective Affiliate shall be permitted to conduct human clinical trials for, and sell, offer for sale and have sold, a Competing Product in such country unless Licensee can reasonably demonstrate that Licensee (x) is continuing to Develop, and (y) has used and is continuing to use Commercially Reasonable Efforts to Develop, in each case ((x) and (y)) a Licensed Compound and a Licensed Product for such country, including taking all necessary steps to obtain and maintain Regulatory Approval with respect to such Licensed Product in such country.

2.7.Trademark License. Subject to Sections 2.3, 2.4, 2.7, 2.8, 2.9 and the other terms and conditions of this Agreement, Licensor hereby grants to Licensee an exclusive

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(including with regard to Licensor and its Affiliates) license, with the right to grant sublicenses in accordance with Section 2.3, under the Licensed Trademarks solely to Develop, use, sell, offer for sale, import and otherwise Commercialize or Manufacture (solely to the extent permitted under the Supply Agreement), the Licensed Compounds and Licensed Productin the Field in the Territory and for no other purpose. No royalties or other payments in addition to those set forth in Article 5 shall be due by Licensee in respect of its license under the Licensed Trademarks granted pursuant to this Section 2.7.

2.8.Upstream Agreements. The Parties acknowledge and agree that:

(a)Licensor obtained the right to certain Licensed Know-How, Licensed Patents and Licensed Trademarks from MedImmune under the MedImmune License;

(b)the licenses granted to Licensee under this Agreement under such Licensed Know-How, Licensed Patents and Licensed Trademarks constitute the grant of sublicenses under the MedImmune License;

(c)Licensor is a party to the SFJ Agreement which provides for SFJ to provide, among the other things, certain funding to Licensor for the Development of the Licensed Compound and Licensed Product and grants SFJ certain rights regarding the Development of the Licensed Compound and Licensed Product;

(d)Licensor sources certain strains and other technology from Wacker as required for the Manufacture of the Licensed Compound and Licensed Product;

(e)Licensee shall not take or fail to take any action in breach of this Agreement that would cause Licensor to be in breach of any Upstream Agreement;

(f)Licensor shall, on reasonable request from Licensee, provide Licensee with guidance and reasonable assistance in interpreting the Upstream Agreements;

(g)Licensor shall not make any changes to any terms and conditions of any Upstream Agreement that would materially and adversely affect the rights and obligations of Licensee under this Agreement, without the prior written consent of Licensee, which shall not be unreasonably withheld;

(h)Licensor shall provide Licensee with a copy of any executed amendments to any Upstream Agreement that relate to the Territory or Licensee’s rights and obligations under this Agreement, which may be redacted as reasonably required by Licensor;

(i)in the event that the SFJ Agreement is terminated with the result that Licensor continues to Control the Licensed Compounds and Licensed Product, any reference in this Agreement to SFJ and/or SFJ Agreement shall be read and construed as deleted and any relevant provisions as no any longer applicable; and

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(j)anything to the contrary in this Agreement notwithstanding, Licensor shall be solely responsible for all financial and payment obligations under any Upstream Agreement. For avoidance of doubt, Licensee shall not be responsible for any obligation or liability of Licensor under the Upstream Agreements (including any financial or payment obligations or liabilities), except if and to the extent any such Upstream Agreement is assigned or sublicensed to Licensee in accordance with, and subject to, (A) the Acknowledgement of Grant of a Sublicense by and among Licensor, Licensee and MedImmune, or (B) the SFJ Consent Agreement by and among Licensor, Licensee and SFJ, in each case entered into by the respective parties on or about the Effective Date.

2.9.Territory Restriction. Licensee hereby covenants and agrees that it shall not, and shall ensure that its Affiliates and Sublicensees shall not, either directly or indirectly, promote, market, distribute, import, sell or have sold any Licensed Product, including via the internet or mail order, to any Third Party or address or internet protocol address or the like outside the Territory, or to any Third Party that Licensee, or any of its Affiliates or Sublicensees knows (or reasonably should be expected to know) has previously exported or is likely to export the Licensed Product outside the Territory. Licensee shall not engage, and shall ensure that its Affiliates and Sublicensees shall not engage, in any advertising or promotional activities relating to any Licensed Product directed primarily to customers or other buyers or users located in any country or jurisdiction outside the Territory, or solicit orders for the Licensed Product from any prospective customer or other buyer or user located in any country or jurisdiction outside the Territory. If Licensee or its Affiliates or Sublicensees receive any order for the Licensed Product from a prospective customer or other buyer or user located in a country or jurisdiction outside the Territory, Licensee shall immediately refer that order to Licensor and shall not accept any such orders, unless otherwise agreed between the Parties. Licensee shall not, and shall ensure that its Affiliates and Sublicensees shall not, deliver or tender (or cause to be delivered or tendered) any Licensed Product outside the Territory.

ARTICLE 3
Governance

3.1.Alliance Managers. Each Party shall appoint an individual (each, an “Alliance Manager”) who shall oversee the contact between the Parties for all matters and shall have such other responsibilities as the Parties may agree in writing after the Effective Date. A Party may replace the individual serving as its Alliance Manager at any time by notice in writing to the other Party. The Alliance Managers shall work together to manage and facilitate communication between the Parties under this Agreement, including the resolution (in accordance with the terms of this Agreement) of issues between the Parties that arise in connection with this Agreement. The Alliance Managers shall not have final decision-making authority with respect to any matter under this Agreement.

3.2.Joint Steering Committee.

3.2.1.Formation. Within thirty (30) days after the Effective Date, the Parties shall establish a joint steering committee (the “Joint Steering Committee” or the “JSC”) to oversee the Development and Commercialization of the Licensed Product in the Field

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in the Territory under this Agreement. Each Party shall appoint two (2) representatives to the JSC, each of whom shall be an officer or employee of the applicable Party having sufficient seniority within such Party to make decisions arising within the scope of the JSC’s responsibilities. Each Party may replace its JSC representatives upon written notice to the other Party. Each Party shall appoint one of its JSC representatives to act as a co-chairperson of the JSC. The role of the chairpersons shall be to convene and preside at meetings of the JSC and to ensure the preparation of minutes, but the co-chairpersons shall have no additional powers or rights beyond those held by the other JSC representatives.

3.2.2.Role. The JSC shall (i) provide a forum for the discussion of the Parties’ activities under this Agreement; (ii) review and discuss the overall strategy for the Development and Commercialization of the Licensed Product in the Field in the Territory; (iii) review, discuss and approve the Development Plan and amendments thereto; (iv) review and discuss the Commercialization Plan and amendments thereto; (v) consider information provided by Licensor with respect to any issue relating to the Manufacturing and supply to Licensee of the Licensed Compound and/or Licensed Product for the Territory; (vi) discuss any issue relating to Manufacturing of the Licensed Compound and/or Licensed Product that may impact the ability of Licensor to Manufacture or supply the Licensed Compound and/or Licensed Product for the Territory in accordance with the Supply Agreement; (vii) on at least an annual basis, discuss the proposed Development activities that each Party is considering undertaking during the next year; (viii) discuss and consider any clinical study that either Party may be considering undertaking or that they are undertaking and that may occur both inside and outside the Territory, including, but not limited to, considering which Party will be responsible for such clinical study and appropriate sharing of the costs of such study; (ix) consider regulatory issues and medical affairs that relate to the Licensed Product both inside and outside the Territory; (x) establish joint subcommittees (such as Development subcommittee and Commercialization subcommittee) as necessary or advisable to further the purpose of this Agreement; (xi) consider any request from Licensee to undertake Improvements as further set out in Section 3.3; and (xii) perform such other functions as expressly set forth in this Agreement or allocated to it by the Parties’ written agreement.

3.2.3.Limitation of Authority. The JSC shall only have the powers expressly assigned to it in this Section 3.2 and elsewhere in this Agreement and shall not have the authority to: (i) modify or amend the terms and conditions of this Agreement; (ii) waive either Party’s compliance with the terms and conditions of this Agreement; or (iii) determine any such issue in a manner that would conflict with the express terms and conditions of this Agreement.

3.2.4.Meetings. The JSC shall hold meetings at such times as it elects to do so, but in no event shall such meetings be held less frequently than once every calendar quarter. Each Party may call additional ad hoc JSC meetings as the needs arise with reasonable advance notice to the other Party. Meetings of the JSC may be held in person, by audio or video teleconference as the Parties may agree. The co-chairpersons of the

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JSC shall jointly prepare the agenda and minutes for each JSC meeting. Each Party shall be responsible for all of its own expenses of participating in the JSC meetings. No action taken at any JSC meeting shall be effective unless at least one representative of each Party is participating in such JSC meeting.

3.2.5.Non-Member Attendance. Each Party may from time to time invite a reasonable number of participants, in addition to its representatives, to attend the JSC meetings in a non-voting capacity; provided that if either Party intends to have any Third Party (including any consultant) attend such a meeting, such Party shall provide prior written notice to the other Party. Such Party shall also ensure that such Third Party is bound by confidentiality and non-use obligations consistent with the terms of this Agreement. Subject to the foregoing, a representative of SFJ may attend at least one JSC meeting each year to discuss the Commercialization Plan pursuant to Section 4.4.4, provided that (i) any such representative of SFJ has a proven long-term experience with respect to the Commercialization in the Territory of pharmaceutical products, and (ii) such representative of SFJ has been previously approved by Licensee and Licensor (such approval by Licensee and Licensor not to be unreasonably withheld, conditioned or delayed), and the JSC shall consider in good faith any comment provided by such representative with respect to the Commercialization Plan.

3.2.6.Decision-Making. All decisions of the JSC shall be made by unanimous vote, with each Party’s representatives having one vote between them. If after reasonable discussion and good faith consideration of each Party’s view on a particular matter before the JSC, the JSC cannot reach a decision as to such matter within thirty (30) days after such matter was brought to the JSC for resolution, such matter shall be referred to the Chief Executive Officer of Licensor and the Chief Executive Officer of Licensee (the “Executive Officers”) for resolution. The Executive Officers shall promptly meet and use good faith efforts to resolve such matter. If the Executive Officers cannot resolve such matter within thirty (30) days after such matter has been referred to them, then [***], provided, however, that:

(a)[***];

(b)[***];

(c)[***];

(d)[***];

(e)[***];

(f)[***];

(g)[***]; and

(h)[***].

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(i)For clarity, the JSC shall have no decision-making authority with respect to the Development of the Licensed Product (whether inside or outside the Territory) or Commercialization of the Licensed Product outside the Territory.

3.3.Licensee Improvements. If at any time Licensee wishes to undertake research and Development activities with the aim of generating any Improvements, Licensee shall first notify the JSC of such intention including reasonable details of its plans and the research and Development activities that it wishes to undertake (the “Proposed Activities”). The JSC shall, acting reasonably and in good faith, consider any request by Licensee to undertake the Proposed Activities and any decision of the JSC shall be undertaken in accordance with Section 3.2.

3.3.1.If the JSC agrees that the Licensee shall be permitted to undertake the Proposed Activities, [***].

(a)If Licensor [***].

(b)If Licensor [***].

3.3.2.If the JSC does not agree that Licensee shall be permitted to undertake the Proposed Activities, Licensee shall not undertake the Proposed Activities or any other research and development activities in respect of the Licensed Compounds or Licensed Product or generate any Licensee Improvements.

3.3.3.If the JSC agrees that Licensee can undertake the Proposed Activities [***]. The following provisions shall apply [***]:

(a)Licensee shall notify Licensor in writing of any significant Licensee Improvements developed and/or acquired by Licensee as a result of Licensee, its Affiliates, Sublicensees or their respective Third Party contractors undertaking the Proposed Activities, including reasonable details thereof.

(b)[***].

(c)[***].

(d)[***].

(e)[***].

(f)[***].

(g)[***]

(h)[***].

3.4.Discontinuation of the JSC. The activities to be performed by the JSC shall solely relate to governance under this Agreement and are not intended to be or involve the

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delivery of services. The JSC shall continue to exist until the first to occur of: (a) the Parties mutually agreeing to disband the JSC; or (b) subject to the performance by Licensor of the Development and regulatory activities undertaken pursuant to Sections 4.2.1 and 4.3.1(a), Licensor providing written notice to Licensee of its intention to disband and no longer participate in the JSC. Once the Parties mutually agree or Licensor has provided written notice, to disband the JSC, the JSC shall have no further obligations under this Agreement and, thereafter, the Alliance Managers shall be the contact persons for the exchange of information under this Agreement and reference to decisions of the JSC shall be read and construed as references to decisions between the Parties, subject to the same respective decision-making rights and limitations set forth in Section 3.2.6 and other terms and conditions of this Agreement.

ARTICLE 4
MANUFACTURING, DEVELOPMENT, REGULATORY AND COMMERCIALIZATION ACTIVITIES

4.1.Manufacturing.

4.1.1.Subject to the terms and conditions of the Supply Agreement:

(a)during the period of [***], Licensee shall purchase from Licensor, and Licensor shall Manufacture or have Manufactured and supply, all of Licensee’s and its Affiliates’ and Sublicensees’ requirements of the finished Licensed Product for Development and Commercialization use in the Field in the Territory;

(b)following the expiration of [***], Licensee shall purchase from Licensor at least [***] percent ([***]%) of Licensee’s and its Affiliates’ and Sublicensees’ requirements for the finished Licensed Product for Development and Commercialization use in the Field in the Territory, provided, however, that for the avoidance of doubt, (i) Licensee shall be entitled to order from Licensor one hundred percent (100%) of Licensee’s and its Affiliates’ and Sublicensees’ requirements for such Licensed Products during such period, and (ii) Licensor shall Manufacture or have Manufactured and supply, all of Licensee’s and its Affiliates’ and Sublicensees’ requirements of the finished Licensed Product for Development and Commercialization use in the Field in the Territory.

4.1.2.Within one hundred twenty (120) days after the Effective Date, the Parties shall negotiate in good faith and enter into a supply agreement and related quality agreement for the Manufacture and supply of the Licensed Product by Licensor to Licensee which will incorporate the terms set out in Schedule 4.1.2 (collectively, the “Supply Agreement”).

4.2.Development.

4.2.1.Development by Licensor. Notwithstanding the exclusive license granted by Licensor to Licensee in the Field in the Territory, Licensor shall be

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responsible for, and shall use Commercially Reasonable Efforts to conduct, Development of the Licensed Product in the Field in the Territory (including conducting the Phase III Clinical Trial and any Regulator-Requested Trial that the Regulatory Authorities require Licensor to complete prior to the Regulatory Documentation Assignment Date) as necessary for Licensor to prepare and file Drug Approval Applications for the Licensed Product with the EMA and the UK MHRA, which Development shall be conducted in accordance with the Development Plan and at Licensor’s own cost and expense, to obtain an Unconditional Regulatory Approval by both EMA and UK MHRA. Licensor shall keep Licensee reasonably informed of its plans for Development for the Licensed Product in the Territory and shall consider in good faith any reasonable comments provided by Licensee.

4.2.2.Development by Licensee. Except for Development to be conducted by Licensor under Sections 4.2.1 and 4.3.1(a), after the Regulatory Documentation Assignment Date Licensee shall be solely responsible for, and shall use Commercially Reasonable Efforts to conduct, all Development activities (other than the Phase III Clinical Trial and any Regulator-Requested Trial that the Regulatory Authorities require Licensor to complete prior to the Regulatory Documentation Assignment Date) relating to the Licensed Product in the Field in the Territory pursuant to Section 4.3.1(b), as necessary for Licensee to obtain and/or maintain Regulatory Approval for the Licensed Product in the Field in the Territory, which Development shall be conducted at Licensee’s own cost and expense. Licensee shall keep Licensor reasonably informed of its plans for Development for the Licensed Product in the Territory and shall provide Licensor with copies of all documentation and correspondence relating to its efforts concerning regulatory matters relating to the Licensed Product in the Territory and developments with respect thereto, including Licensee’s expected timing with respect to submission and receipt of any and all Regulatory Approvals. Prior to filing any document or sending any correspondence to a Regulatory Authority concerning regulatory matters relating to the Licensed Product in the Territory, Licensee shall provide a draft to Licensor. Licensor shall provide its comments on such draft within ten (10) Business Days after receipt thereof and Licensee shall consult with Licensor regarding such reasonable comments, shall consider in good faith any reasonable comments provided by Licensor and shall incorporate such reasonable comments into the draft to be submitted to the Regulatory Authority. Licensee shall promptly inform Licensor of any submissions to the Regulatory Authorities regarding Regulatory Approvals and provide Licensor with copies of such submissions.

4.2.3.MedImmune License. The Parties acknowledge that regulatory matters with respect to the Licensed Product will require reasonable coordination with regulatory matters with respect to the AstraZeneca Product, and Licensee agrees to cooperate in good faith with Licensor and MedImmune as reasonably necessary for and in relation to each of Licensor and Licensee, on the one hand, and MedImmune, on the other hand, to obtain and maintain regulatory approvals in the Territory (including Regulatory Approvals) with respect to the Licensed Product in the case of Licensor and Licensee and with respect to the AstraZeneca Product in the case of MedImmune. Prior to submitting

30

any written or electronic communication to a Regulatory Authority in a country of the Territory with respect to the Licensed Product that would reasonably be expected to require a change to the Regulatory Authority-approved, full-prescribing information for Licensed Product and/or AstraZeneca Product for such country, Licensee shall cooperate with Licensor in Licensor’s consultation with MedImmune and shall provide such information as Licensor may reasonably request for Licensor to comply with the terms of the MedImmune License and/or any requests made by the relevant Regulatory Authority.

4.2.4.SJF Agreement. The Parties acknowledge that regulatory matters with respect to the Licensed Product will require reasonable coordination with SFJ as required to enable Licensor to comply with the terms of the SFJ Agreement. In particular the Licensee is aware that prior to the Regulatory Assignment Date, all information, generated or developed by Licensee, if applicable, Licensor or SFJ in the conduct of clinical trials undertaken pursuant to the SFJ Agreement or hereunder will be owned by SFJ but will be transferred by SFJ to Licensor on the Regulatory Assignment Date as provided in the SFJ Agreement. Licensee agrees to cooperate in good faith with Licensor and SFJ as reasonably necessary for and in relation to each of Licensor and Licensee, on the one hand, and SFJ, on the other hand, to obtain and maintain regulatory approvals in the EU Market and the United Kingdom (including Regulatory Approvals by EMA and UK MHRA) with respect to the Licensed Product. Prior to submitting any written or electronic communication to a Regulatory Authority in a country of the EU Market or the United Kingdom with respect to the Licensed Product that would reasonably be expected to require a change to the Regulatory Authority-approved, full-prescribing information for the Licensed Product for such country, Licensee shall cooperate with Licensor in Licensor’s consultation with SFJ and shall provide such information as Licensor may reasonably request for Licensor to comply with the terms of the SFJ Agreement and/or any requests made by EMA and/or UK MHRA.

4.2.5.Wacker License. The Parties acknowledge that the Manufacturing of the Licensed Product by Licensor may require reasonable coordination between Licensor and Wacker as required to enable Licensor to comply with the terms of the Wacker License and the Supply Agreement. Licensee agrees to cooperate in good faith with Licensor to provide such information or documentation in its possession reasonably necessary for Licensor to meet its obligations under the Wacker License.

4.2.6.Development Plan. All Development of the Licensed Product in the Field in the Territory shall be conducted by the Parties pursuant to the Development Plan. As of the Effective Date, the Parties have agreed to the Development Plan, which has also been approved by SFJ pursuant to the SFJ Agreement. Prior to the Regulatory Documentation Assignment Date, Licensor may update and amend the Development Plan from time to time in consultation with Licensee and submit the update or amendment to the JSC for review and approval. Following the Regulatory Documentation Assignment Date, Licensee may update and amend the Development Plan from time to time in consultation with Licensor and submit the update or amendment to the JSC for review and approval. Once approved by the JSC, the updated or amended Development Plan

31

shall become effective. Notwithstanding anything to the contrary herein, if Licensee’s Development work includes any clinical trials of the Licensed Product, Licensor shall have the right to approve the protocols of all such clinical trials.

4.2.7.Development Records. Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, maintain, in good scientific manner, complete and accurate books and records pertaining to Development of the Licensed Compounds and Licensed Product hereunder, in sufficient detail to verify compliance with its obligations under this Agreement. Such books and records shall (a) be appropriate for patent and regulatory purposes, (b) be in compliance with Applicable Law, (c) properly reflect all work done and results achieved in the performance of its Development activities hereunder, and (d) be retained by Licensee for such period as may be required by Applicable Law. Upon reasonable advance notice, Licensor shall have the right, during normal business hours and upon reasonable notice, to inspect and copy any or all such books and records pursuant to this Section 4.2.7.

4.2.8.Development Reports. Licensee shall keep Licensor reasonably informed as to the progress and results of its and its Affiliates’ and Sublicensees’ Development of the Licensed Product in the Field in the Territory. Without limiting the generality of the foregoing, at each regularly scheduled JSC meeting, Licensee shall provide Licensor with a written report summarizing the Development performed by Licensee, its Affiliates and Sublicensees and the results thereof, covering subject matter at a level of detail reasonably required by Licensor and sufficient to enable Licensor to determine Licensee’s compliance with its diligence obligations pursuant to Section 4.2.2. In addition, Licensee promptly shall provide Licensor with key Development results from any clinical trial with respect to a Licensed Product, in each case reasonably in advance of any public announcement of such results.

4.2.9.Data Exchange and Use. In addition to its adverse event and safety data reporting obligations pursuant to Section 4.3.6, each Party shall promptly provide the other Party with copies of all data and results and all supporting documentation (e.g., protocols, case report forms, analysis plans) generated from its Development of the Licensed Product in the Field. Licensee shall have the right to use the data provided to Licensee by Licensor solely for the purpose of obtaining and maintaining Regulatory Approval for and Commercializing the Licensed Product in the Field in the Territory. Licensor shall have the right to use the data provided by Licensee for the purpose of (a) obtaining and maintaining Regulatory Approval for and Commercializing the Licensed Product outside the Territory and (b) Exploiting the AstraZeneca Product anywhere in the world.

4.3.Regulatory Activities.

4.3.1.Regulatory Approvals; Assigned Regulatory Documentation.

(a)Subject to Section 4.2.1, Licensor shall be responsible for preparing and filing Drug Approval Applications for the Licensed Product with

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the EMA and the UK MHRA, and interactions with the EMA and the UK MHRA, in order to obtain Conditional Regulatory Approvals and the Unconditional Regulatory Approvals by both the EMA and the UK MHRA. After obtaining the Unconditional Regulatory Approvals from both the EMA and the UK MHRA (the “Regulatory Documentation Assignment Date”), Licensor shall transfer and assign each of Unconditional Regulatory Approvals, including the related Regulatory Documentation, to Licensee or its designated Affiliate (collectively, the “AssignedRegulatory Documentation”). Subject to the first sentence of this Section 4.3.1(a), with effect from the Regulatory Documentation Assignment Date, Licensee shall hold such Regulatory Approvals in its own name and shall be responsible for maintaining such Regulatory Approvals and for obtaining other Regulatory Approvals required for the Licensed Product in the Field in the Territory, all at Licensee’s own cost and expense. Notwithstanding the foregoing, Licensor shall (i) upon request of Licensee, provide to Licensee any and all Licensed Know-How, including Regulatory Documentation, and any updates thereof, as required by Licensee to file any Drug Approval Applications for the Licensed Product and/or to obtain and/or maintain the Regulatory Approvals in the Territory; and (ii) be permitted to retain copies of the Assigned Regulatory Documentation for purposes of Exploiting the Licensed Product outside of the Territory, Exploiting the AstraZeneca Product worldwide and otherwise.

(b)Subject to Licensor’s retained rights under Section 2.4.1 and Licensor’s rights and obligations under Sections 4.3.1 and except as otherwise set forth in this Section 4.3, with effect from the Regulatory Documentation Assignment Date, Licensee shall (i) have the sole right and responsibility, at Licensee’s own cost and expense, to prepare and submit (including the setting of the overall regulatory strategy therefor) Drug Approval Applications in its or its Affiliates’ name (to the extent permitted under Applicable Law), (ii) use Commercially Reasonable Efforts to obtain and/or maintain the Regulatory Approvals, and other submissions (including INDs) to Regulatory Authorities, and (iii) conduct communications with the Regulatory Authorities, in each case, for Licensed Product in the Field in the Territory. Licensee shall keep Licensor reasonably informed of its Commercially Reasonable Efforts to obtain and/or maintain Regulatory Approval for any Licensed Product in the Territory and developments with respect thereto, including Licensee’s expected timing with respect to submission and receipt of any and all Regulatory Approvals. If the conduct of any clinical trial (in addition to the Phase III Clinical Trial and any Regulator-Requested Trial being undertaken by Licensor pursuant to Section 4.3.1(a)) is required for Licensee to obtain and/or maintain any Regulatory Approval in the Territory, such clinical trial shall be undertaken at Licensee’s cost and expense. Licensee shall provide a draft of the relevant protocol for such clinical trial to Licensor for review and comment prior to submission to the Regulatory Authority and such protocol shall be subject to Licensor’s prior written approval.

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4.3.2.Regulatory Interactions. Without limitation to Section 4.2.8 or Section 4.3.1(a), Licensee shall, except to the extent a need for exigent action prevents it from doing so, provide Licensor with drafts of all material Regulatory Documentation prepared by Licensee, its Affiliates and Sublicensees for the Licensed Product in the Field in the Territory, including copies of Licensee’s initial Drug Approval Applications, a reasonable amount of time (but no less than thirty (30) days) prior to the anticipated date for the applicable submission to allow Licensor to review and comment on such documentation, provided, however, that such drafts contain material changes with respect to the Drug Approval Applications filed by Licensor to EMA and/or the Regulatory Approvals obtained by EMA pursuant to Section 4.3.1(a). Licensee shall consider all comments and proposed revisions timely provided from Licensor in good faith in connection with effecting such submission. With respect to such drafts of material Regulatory Documentation, Licensee shall:

(a)provide Licensor with copies of the relevant Regulatory Documentation relating to the Licensed Product received from any Regulatory Authority in the Territory within five (5) Business Days after receipt;

(b)provide Licensor with reasonable advance notice (no less than twenty (20) Business Days in any event) of any meeting or discussion with any Regulatory Authority in the Territory related to the Licensed Product, and Licensor shall have the right (but not the obligation) to attend and participate in such meeting or discussion; and

(c)consult with Licensor regarding, and keep Licensor informed of: (i) any material changes with respect to the dossier; (ii) the rationale for making such changes; and (iii) the proposed labeling relating to the Licensed Product.

4.3.3.Regulatory Coordination with AstraZeneca Product.

(a)Subject to Section 4.3.1(b), the Parties acknowledge that regulatory matters with respect to the Licensed Product will require coordination between the Parties with respect to the AstraZeneca Product and agree to cooperate in good faith with each other as reasonably necessary to obtain and maintain Regulatory Approval for the Licensed Product in the Field in the Territory. Licensor shall have the right to share with MedImmune and SJF for review and comment any Regulatory Documentation provided by Licensee to Licensor hereunder. Licensor shall use its Commercially Reasonable Efforts to cause MedImmune and SFJ to cooperate in accordance with the terms of this Agreement and/or the relevant Upstream Agreements.

(b)Without limiting the foregoing, prior to submitting Regulatory Documentation to a Regulatory Authority in a country of the Territory with respect to the Licensed Product that would reasonably be expected to require a change to the Regulatory Authority-approved, full-prescribing information for the

34

AstraZeneca Product for such country, Licensee shall consult with Licensor and MedImmune in good faith.

(c)In addition, upon Licensor’s request, Licensee shall promptly (and in any event, within thirty-six (36) hours) provide to Licensor access to and copies of any Regulatory Documentation necessary or reasonably useful for MedImmune to Exploit the AstraZeneca Product or update the label with respect thereto.

4.3.4.Right of Reference.

(a)Licensee hereby grants to Licensor the right of reference to all Regulatory Approvals and Regulatory Documentation pertaining to the Licensed Product submitted by or on behalf of Licensee. Licensor may use such right of reference to Licensee’s Regulatory Approvals (including Regulatory Approvals that relate to the Exploitation of the Licensed Product in the Field outside the Territory), and Regulatory Documentation for the purpose of seeking, obtaining and maintaining any regulatory approval of the Licensed Product in the Field outside the Territory. Licensor and its Affiliates and Sublicensees may grant MedImmune and its Affiliates and Sublicensees such right of reference to Licensee’s Regulatory Approvals and Regulatory Documentation for the purposes of Exploiting the AstraZeneca Product anywhere in the world.

(b)Licensor hereby grants to Licensee the right of reference to all regulatory approvals and Regulatory Documentation pertaining to the Licensed Product submitted by or on behalf of Licensor. Licensee may use such right of reference to Licensor’s regulatory approvals (including regulatory approvals that relate to the Exploitation of the Licensed Product in the Field in the Territory), and Regulatory Documentation for the purpose of seeking, obtaining and maintaining any Regulatory Approval of the Licensed Product in the Field in the Territory.

4.3.5.Recalls, Suspensions or Withdrawals. Licensee shall notify Licensor promptly (but in no event later than twenty-four (24) hours in the case of commercially distributed Licensed Product) following its determination that any event, incident or circumstance has occurred that may result in the need for a recall, market suspension, or market withdrawal of a Licensed Product in the Field in the Territory and shall include in such notice the reasoning behind such determination and any supporting facts. As between the Parties, Licensee shall have the right to make the final determination whether to voluntarily implement any such recall, market suspension, or market withdrawal in the Field in the Territory; provided that, to the extent practicable under the circumstances, prior to any implementation of such a recall of a commercially distributed Licensed Product (including samples), or market suspension or market withdrawal of a Licensed Product, Licensee shall consult with Licensor and shall consider Licensor’s comments in good faith, such comments to be provided within forty-eight (48) hours of Licensee’s consultation with Licensor. If a recall, market suspension, or market withdrawal of a Licensed Product in the Field in the Territory is mandated by a Regulatory Authority in

35

the Territory, then, as between the Parties, Licensee shall initiate such a recall, market suspension, or market withdrawal in compliance with Applicable Law. For all recalls, market suspensions, or market withdrawals undertaken pursuant to this Section 4.3.4, as between the Parties, Licensee shall be solely responsible for the execution thereof. [***] shall be responsible for all reasonable costs incurred in connection with a recall, market suspension, or market withdrawal, unless the recall, market suspension, or market withdrawal is due to or caused by [***], in which case [***].

4.3.6.Pharmacovigilance.

(a)Licensee acknowledges that Licensor is bound by the pharmacovigilance and safety information exchange requirements of the MedImmune License and the SFJ Agreement and the terms of the MedImmune Pharmacovigilance Agreement and the SFJ Pharmacovigilance Agreement (copies of which are attached hereto as Exhibit 4.3.6(a)) relating both to the Licensed Product and that, in order to comply with its obligations to MedImmune and SFJ, Licensee must provide adverse event and other safety information relating to the Licensed Product to Licensor in a form and within the applicable time periods necessary for Licensor to comply with the MedImmune License and the SFJ Agreement and the terms of the MedImmune Pharmacovigilance Agreement and the SFJ Pharmacovigilance Agreement.

(b)The safety reporting units from each of the Parties shall meet and shall within one hundred eighty (180) days of the Effective Date, agree upon a written agreement for exchanging adverse event and other safety information relating to the Licensed Product in the Field in the Territory (the “Licensee Pharmacovigilance Agreement”). The Licensee Pharmacovigilance Agreement will (i) provide that Licensee shall not take or fail to take any action relating to the exchange of adverse event and other safety information in breach of the Licensee Pharmacovigilance Agreement that would cause Licensor to be in breach of the MedImmune License, the SFJ Agreement, the MedImmune Pharmacovigilance Agreement and the SFJ Pharmacovigilance Agreement; and (ii) ensure that each Party complies with Applicable Law and the requirements of Regulatory Authorities.

(c)Licensee agrees not to enter into any clinical activity implicating pharmacovigilance obligations for the Licensed Product prior to execution of the Licensee Pharmacovigilance Agreement.

(d)Licensor shall establish and maintain the global safety database for the Licensed Product. Each Party shall hold the primary responsibility for reporting quality complaints, adverse events and safety data related to the Licensed Product in its territory to such database and to the applicable Regulatory Authorities in its territory, as well as responding to safety issues and to all requests of Regulatory Authorities in its territory related to the Licensed Product, in each case at its own cost and to the extent required by Applicable Law; for the

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sake of clarity, Licensor shall have the primary responsibility for reporting quality complaints, adverse events and safety data related to the Licensed Product outside the Territory. Each Party agrees to comply with its respective obligations under the Licensee Pharmacovigilance Agreement and to cause its Affiliates, and Sublicensees to comply with such obligations.

(e)Licensee acknowledges that the safety of the Licensed Product may affect the safety and use of the AstraZeneca Product and Licensee agrees to provide Licensor, in a timely manner with all safety information relating to the Licensed Product in the Territory that is necessary for Licensor to comply with its obligations under the MedImmune Pharmacovigilance Agreement. Without limiting the foregoing, Licensor shall have the right to allow MedImmune to access and copy safety reporting information provided by Licensee regarding the Licensed Product in the Territory solely as required for Licensor to comply with its obligations under the MedImmune License.

(f)With respect to any Licensed Product, unless otherwise agreed by the Parties in writing, Licensee shall notify in writing Licensor or such Affiliate as Licensor may designate of any adverse events and other safety-relevant information and complaints associated with such Licensed Product in the Field in the Territory (each, a “Spontaneous Adverse Event”) of which Licensee becomes aware, outside the conduct of clinical studies within one (1) Business Day after Licensee first learns of such Spontaneous Adverse Event.

(g)Licensee shall notify Licensor according to the timelines under the Licensee Pharmacovigilance Agreement, regardless of seriousness, causality, and whether or not the Licensed Product was used in accordance with the authorized Summary of Product Characteristics (SPC) or any other conditions laid down for marketing of the Licensed Product in accordance with applicable legal requirements including: (i) reports of suspected transmission of an infectious agent for the Licensed Product and (ii) reports of lack of effect, pregnancy, lactation/paternal exposure, medication error, overdose, off-label use, drug interaction, abuse or misuse of the Licensed Product.

(h)Additionally, unless otherwise agreed, Licensee shall notify in writing Licensor or such Affiliate as Licensor may designate, of any serious adverse events and other safety-relevant information and complaints associated with such Licensed Product in the Field in the Territory (each, a “Serious Adverse Event”) of which Licensee becomes aware under the conduct of clinical studies within timelines set forth in Schedule 4.3.6(h), after Licensee first learns of such Serious Adverse Event, as a processed report (e.g., CIOMS or E2B file).

(i)Licensee shall notify in writing Licensor of any other safety-relevant information and complaints associated with such Licensed Product in the Territory that is not a Serious Adverse Event (each, an “Other Adverse Event”)

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of which Licensee becomes aware in the course of conducting clinical trials promptly after Licensee first learns of such Other Adverse Event.

(j)Licensee shall cooperate with Licensor and MedImmune to investigate and follow-up on any such Serious Adverse Events or Other Adverse Events associated with such Licensed Product. For clarity, Licensor or its Affiliate shall have final decision-making authority as to whether and how to report safety information pertaining to any Licensed Product outside the Territory, and Licensee shall have final decision-making authority as to whether and how to report safety information pertaining to any Licensed Product in the Territory.

(k)Paragraphs (f), (g), (h), (i) and (j) of this Section 4.3.6, shall also apply to Licensor, mutatis mutandis.

(l)Licensee shall provide reasonable assistance to and cooperate with MedImmune concerning any adverse events and other safety-relevant information and complaints associated with the AstraZeneca Product, the extent that the safety information is available to Licensee, if requested to do so in writing by Licensor.

(m)Without limitation to any of the foregoing, Licensee shall ensure that all applicable patient authorizations and consents required under Applicable Law, including the Health Insurance Portability and Accountability Act of 1996 and the EU Data Protection Directive 95/46/EC, in connection with safety information pertaining to the Licensed Compounds and Licensed Product from any sources, permit such sharing of safety information with Licensor and MedImmune or its Affiliate, including patient information required to contact the reporter where the source is outside the conduct of a clinical study.

(n)Unless already provided or otherwise communicated to the other Party pursuant to this Section 4.3.6 and/or the Licensee Pharmacovigilance Agreement, each Party shall provide the other Party at meetings of the JSC (or in advance of such meetings as part of the information that may be distributed to JSC members prior to such meetings or, if no such meeting is held in a Calendar Quarter, directly to the other Party) at least once during each Calendar Quarter with summaries of all data known to such Party material to obtaining Regulatory Approval, and material Licensed Product safety data in all indications (including but not limited to Serious Safety Issues), including such material data relating to efficacy, clinical sites, patient enrolment and drop-out rates, CMC and other material manufacturing data, and material communications with Regulatory Authorities.

4.4.Commercialization.

4.4.1.Diligence. As between the Parties, Licensee shall, subject to the remainder of this Section 4.4, be solely responsible for Commercialization of the Licensed Product in the Field throughout the Territory at Licensee’s own cost and

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expense. Licensee shall use Commercially Reasonable Efforts to Commercialize the Licensed Product in the Field in each country in the Territory.

4.4.2.Booking of Sales; Distribution. Licensee shall invoice and book sales, establish all terms of sale (including pricing and discounts), and warehouse and distribute the Licensed Product in the Field in the Territory and perform or cause to be performed all related services. Subject to Section 4.3.5, Licensee shall handle all returns, recalls or withdrawals, order processing, invoicing, collection, distribution, and inventory management with respect to the Licensed Product in the Field in the Territory.

4.4.3.Commercialization Records. Without limitation of Section 5.8, Licensee shall maintain complete and accurate books and records pertaining to Commercialization of Licensed Product hereunder in accordance with Applicable Law and in sufficient detail to verify compliance with its obligations under this Agreement. Such records shall be retained by Licensee for such period as may be required by Applicable Law. Upon reasonable advance notice, Licensor shall have the right, during normal business hours, to inspect and copy all such books and records maintained pursuant to this Section 4.4.3 solely for the purpose of assessing compliance by Licensee with the terms of this Agreement.

4.4.4.Commercialization Plans. Without limiting Section 4.4.3, commencing at least twelve (12) months prior to the anticipated filing of the first Drug Approval Application for each Licensed Product anywhere in the Territory, within thirty (30) days following the end of each Calendar Year, Licensee shall provide the JSC with Licensee’s then-current written Commercialization Plan for the Licensed Product (“Commercialization Plan”). The Commercialization Plan shall include detailed plans, strategy, and timelines for Licensee to Commercialize the Licensed Product in the Markets in the Territory, specifically including (but not limited to) France, Germany, Italy, Spain, and the United Kingdom, and shall include (without limitation) Licensee’s plans, strategy and timelines with respect to brand planning, medical affairs, pricing and reimbursement, sales force planning and sizing and other functions reasonably required for Commercialization. Through the JSC, Licensor shall have the right to review and provide comments to Licensee on each Commercialization Plan, including with respect to any material amendment thereof, which comments Licensee shall consider in good faith. All Commercialization of the Licensed Product in the Field in the Territory shall be conducted pursuant to the Commercialization Plan.

4.4.5.Commercialization Strategy. On a Market-by-Market basis until expiration of the last-to-expire Valid Claim of the Patents owned or controlled by MedImmune or its Affiliates that claim the manufacture, use or sale of the AstraZeneca Product in such Market, Licensee shall use Commercially Reasonable Efforts to align its Commercialization strategy and Promotional Materials of the Licensed Product in such Market with the positioning, brand equity and overall commercial strategy for the AstraZeneca Product in such Market as may be promptly communicated from time to time to Licensee by Licensor on behalf of MedImmune; provided, however, Licensee

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shall not be obligated to so align its Commercialization strategy and Promotional Materials of the Licensed Product in any manner that, upon the advice of Licensee’s regulatory advisors or legal counsel, Licensee determines would be inconsistent with Applicable Law in such Market.

4.4.6.Promotional Materials.

(a)Without limiting Section 4.4.5 or any other term or condition of this Agreement, Licensor shall have the right to review and approve any and all Promotional Materials (including any information for use on the Internet), and including any updates or modifications thereto. Licensee shall provide any Promotional Materials to Licensor for review (by Licensor and its Affiliates) at least sixty (60) days prior to submission of such Promotional Materials (or such updates or modifications) to a Regulatory Authority or sixty (60) days prior to the printing of such materials for distribution to the public, whichever comes first. Licensor shall notify Licensee whether Licensor approves such Promotional Materials within ten (10) Business Days of receipt of such Promotional Materials, such approval not to be unreasonably withheld or conditioned.

(b)Licensee acknowledges and agrees that any Promotional Materials that contain any AstraZeneca Product Reference are subject to additional approval by MedImmune in accordance with the MedImmune License. Licensee shall not use or distribute any such Promotional Materials without such approval, and Licensor shall use Commercially Reasonable Efforts to obtain approval of such Promotional Materials from MedImmune within thirty (30) days of receipt by MedImmune of such Promotional Materials, provided however that (i) in no event shall Licensee seek approval of or include in Promotional Materials any AstraZeneca Product Reference that is not (A) supported by the approved labeling for the AstraZeneca Product or presents an unbalanced view of the AstraZeneca Product considering the approved labeling for the AstraZeneca Product as a whole or (B) consistent with the approved labeling for the Licensed Product, and (ii) neither Licensor nor MedImmune shall have any obligation to approve any AstraZeneca Product References that use any Trademark with respect to the AstraZeneca Product other than the Trademark licensed by MedImmune to Licensor under the MedImmune License. Licensee further acknowledges that, under the MedImmune License, MedImmune shall have the right to withdraw its approval with respect to, or require amendment of, any Promotional Materials containing any AstraZeneca Product Reference that, in the reasonable determination of MedImmune, (aa) do not comply with Applicable Law or (bb) are not aligned with the then-current positioning, brand equity and overall commercial strategy for the AstraZeneca Product as determined by MedImmune on an annual basis in connection with MedImmune’s or its Affiliates’ annual brand-planning cycle and communicated by MedImmune to Licensee annually following the conclusion of such planning cycle. In the event MedImmune withdraws or amends its approval with respect to any AstraZeneca Product

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Reference, Licensor shall promptly notify Licensee, and Licensee shall, at its own cost and expense, use reasonable efforts to cease the use of any Promotional Material containing such AstraZeneca Product Reference or adopt the amended AstraZeneca Product Reference, as applicable, (x) within ten (10) Business Days of MedImmune’s notification or such shorter period required by Applicable Law, in the case of any such withdrawal or amendment pursuant to clause (aa) above; or (y) within thirty (30) days of MedImmune’s notification, in the case of any such withdrawal or amendment pursuant to clause (bb) above.

4.4.7.Commercialization Disputes. If a dispute arises between the Parties in connection with or relating to any Commercialization activity of Licensee or right of Licensor under Section 4.4.6 (each, a “Commercialization Dispute”), then such Commercialization Dispute shall be subject to dispute resolution as set forth in Section 11.6.

4.4.8.Coordination of Commercialization Activities. The Parties recognize that they may benefit from the coordination of certain activities in support of the Commercialization of the Licensed Product across their territories. As such, the Parties may coordinate such activities where appropriate. If the Parties agree to jointly conduct any specific Commercialization activities for the benefit of the Licensed Product in both Parties’ territories, the Parties shall negotiate in good faith and agree on the details of such activities, including allocation of responsibilities, budget and cost sharing.

4.4.9.Pricing. Licensee shall advise Licensor of its proposed pricing for the Licensed Product in each country in the Territory in advance of commencing price discussions with Regulatory Authorities or parties involved in reimbursement decisions. To the extent legally permitted under Applicable Law Licensee shall keep Licensor reasonably informed on the status of any application for pricing or reimbursement approval for the Licensed Product in each country in the Territory, including any discussion with Regulatory Authorities with respect thereto. Licensee shall have the sole right to determine the price of the Licensor Product sold in the Territory but, subject to this Section 4.4.9, shall consider in good faith any comments received from Licensor with respect to pricing of the Licensed Product.

4.4.10.Commercialization Reports. Licensee shall keep Licensor reasonably informed of its, its Affiliates’ and Sublicensees’ Commercialization of the Licensed Product in the Field in the Territory. Without limiting the foregoing, at each regularly scheduled JSC meeting, Licensee shall provide Licensor with a written report summarizing significant Commercialization activities for the Licensed Product in the Field in the Territory, covering the subject matter at a level of detail reasonably required by Licensor and sufficient to enable Licensor to determine Licensee’s performance of its Commercialization obligations under this Agreement.

4.5.Statements and Compliance with Applicable Law. Licensee shall, and shall cause its Affiliates and Sublicensees to, comply with all Applicable Law with respect to the Development and Commercialization of Licensed Product. Licensee shall avoid, and shall cause

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its Affiliates and its and their Sublicensees to avoid, taking or failing to take any actions that Licensee knows or reasonably should know would have an adverse effect on the goodwill or reputation of Licensor, MedImmune, SFJ or their respective Affiliates, the AstraZeneca Product, the Licensed Product or any Trademark associated therewith. Without limitation to the foregoing, Licensee shall in all material respects conform its practices and procedures relating to the Commercialization of the Licensed Product in the Territory and educating the medical community in the Territory with respect to the Licensed Product to any applicable industry association regulations, policies and guidelines, as the same may be amended from time to time, and Applicable Law.

4.6.Markings. To the extent requested by Licensor in writing or otherwise required by Applicable Law, the Promotional Materials (including web and social media content), packaging, and Product Labeling for the Licensed Product used by Licensee, its Affiliates and its and their Sublicensees in connection with the Commercialization of the Licensed Product in the Territory shall contain such Licensor Corporate Name(s) and/or MedImmune Corporate Name(s), as designated by Licensor, in a manner mutually approved by Licensor (and MedImmune, as applicable) and Licensee and subject to Section 6.7 (such approval not to be unreasonably withheld by Licensee); provided, however, that in no event shall Licensee or any of its Affiliates or Sublicensees be required to give any such Licensor Corporate Name and/or MedImmune Corporate Name the same or greater prominence than any Licensee Corporate Name or Licensed Trademark on any such Promotional Materials (including web and social media content), packaging, and Product Labeling for the Licensed Product.

4.7.Subcontracting. Licensee may subcontract with a Third Party to perform obligations of Licensee hereunder (including by appointing one or more distributors); provided that (a) no such permitted subcontracting shall relieve Licensee of any obligation hereunder or any liability and Licensee shall be and remain fully responsible and liable therefor and (b) the agreement pursuant to which Licensee engages any Third Party subcontractor must, except as otherwise provided in Section 6.1.8(a)(i) be consistent in all material respects with the relevant provisions of this Agreement, and contain terms obligating such subcontractor to comply with the confidentiality, intellectual property and all other relevant provisions of this Agreement. Licensee shall be responsible for the compliance of each subcontractor with all of the applicable terms and conditions of this Agreement.

4.8.Product Positioning Principles.

4.8.1.Together with the delivery of the Commercialization Plan to Licensee under Section 4.4.4, Licensee shall provide Licensor for comment and review a written proposal detailing the core principles for the positioning of the Licensed Product, including the target profile for the Licensed Product, proposed label claims (or the actual label claims, if then applicable) for the Licensed Product and the proposed positioning of the Licensed Product in relation to the AstraZeneca Product (including proposed AstraZeneca Product References for such use) pursuant to Section 4.8.2; Licensee shall consider in good faith any comments and revisions made by Licensor to such Product positioning principles (the “Product Positioning Principles”). Licensee’s Product

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Positioning Principles may take the form of slide decks, talking points or other similar aids for use in communications of Licensee or any of its Affiliates or its or their Sublicensees with Third Parties relating to the Licensed Product in the Territory. Commercialization of the Licensed Product in the Territory must be consistent with the Product Positioning Principles.

4.8.2.Licensee acknowledges that under the MedImmune License, Licensor has agreed to align its global Product Positioning Principles with the positioning, brand equity and overall commercial strategy for the AstraZeneca Product as may be communicated to Licensor by MedImmune on an annual basis in connection with MedImmune’s or its Affiliates’ annual brand-planning cycle. In order for Licensor to obtain MedImmune’s approval of Licensor’s global Product Positioning Principles, Licensee’s Product Positioning Principles in the Territory must be consistent with Licensor’s global Product Positioning Principles as communicated to Licensee by Licensor. Licensee’s Product Positioning Principles may utilize in relation to the AstraZeneca Product only Information that is or becomes part of the public domain by public use, public general knowledge or the like through no breach of this Agreement by Licensee or any of its Affiliates or its or their Sublicensees and shall not utilize Confidential Information of Licensor or its Affiliates or MedImmune, unless Licensor consents in writing. In no event shall (a) Licensee seek approval of or include in its Product Positioning Principles any AstraZeneca Product Reference that is not (i) supported by the approved labeling for the AstraZeneca Product or that present an unbalanced view of the AstraZeneca Product considering the approved labeling for the AstraZeneca Product as a whole or (ii) consistent with the approved labeling for the Licensed Product (if then applicable), and (b) Licensor or MedImmune have any obligation to approve any AstraZeneca Product References that use any Trademark with respect to the AstraZeneca Product other than the Trademark licensed by MedImmune to Licensor under the MedImmune License.

ARTICLE 5
PAYMENTS AND RECORDS

5.1.Upfront Payment. In consideration of the rights granted by Licensor to Licensee hereunder, no later than ten (10) Business Days after receipt of the relevant invoice by Licensee following the Effective Date, Licensee shall pay Licensor a non-refundable and non-creditable upfront amount of Twenty Million Dollars (US$20,000,000).

5.2.Milestones.

5.2.1.Regulatory Milestones.

(a)In consideration of the rights granted by Licensor to Licensee hereunder, Licensee shall pay to Licensor each of the following one-time, non-refundable, non-creditable milestone payments within ten (10) Business Days after receipt of the relevant invoice by Licensee following the first achievement of the corresponding milestone event:

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	Regulatory Milestone Event	Regulatory Milestone Payment
First Regulatory Milestone	Acceptance by EMA of the first Drug Approval Application for a Licensed Product	Ten Million Dollars ($10,000,000)
Second Regulatory Milestone	Achievement of the first Conditional Regulatory Approval from the EMA	Twelve Million Five Hundred Thousand Dollars ($12,500,000)
Third Regulatory Milestone	Achievement of the Unconditional Regulatory Approvals which allow prescribing for both the Bleeding Indication and the Surgical Use Indication from the EMA	Twelve Million Five Hundred Thousand Dollars ($12,500,000)

(b)In the event that the achievement of the Second Regulatory Milestone and the Third Regulatory Milestone set forth above in Section 5.2.1(a) occurs without the First Regulatory Milestone set forth above in Section 5.2.1(a) having been achieved and the corresponding milestone payment having been paid, then the regulatory milestone payment corresponding to the skipped First Regulatory Milestone shall become due and payable concurrently with the milestone payment corresponding to the achievement of the Third Regulatory Milestone.

5.2.2.Procedure for [***]. Prior to [***], Licensor shall [***]. Licensee shall [***]. As promptly as practicable [***], Licensee [***]. Licensor shall [***]. If Licensee [***]. If Licensee [***], then, [***] and Licensee shall [***] and the following provisions shall apply:

(a)if [***], then [***]; or

(b)if [***], then [***]. For the avoidance of doubt, subject to Section 4.3.1(a), [***].

5.2.3.Commercial Milestones. In consideration of the rights granted by Licensor to Licensee hereunder, within forty-five (45) days after [***] in which each of the Net Sales milestones set forth below in this Section 5.2.3 is first achieved Licensee shall pay to Licensor the corresponding one-time, non-refundable, non-creditable milestone payment set forth below:

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Commercial Milestone Event	Milestone Payment
Annual Net Sales of all Licensed Product in the Territory for any and all indications first equal or exceed [***] Euros (€[***])	[***] Dollars ($[***])
Annual Net Sales of all Licensed Product for any and all indications first equal or exceed [***] Euros (€[***])	[***] Dollars ($[***])
Annual Net Sales of all Licensed Product in the Territory for any and all indications first equal or exceed [***] Euros (€[***])	[***] Dollars ($[***])
Annual Net Sales of all Licensed Product in the Territory for any and all indications first equal or exceed [***] Euros (€[***])	[***] Dollars ($[***])
Annual Net Sales of all Licensed Product in the Territory for any and all indications first equal or exceed [***] Euros (€[***])	[***] Dollars ($[***])
Annual Net Sales of all Licensed Product in the Territory for any and all indications first equal or exceed [***] Euros (€[***])	[***] Dollars ($[***])

5.2.4.Determination That Milestones Have Occurred. Licensor shall notify Licensee promptly of the first achievement of each of the First Regulatory Milestone, the Second Regulatory Milestone and the Third Regulatory Milestone, and Licensee shall notify Licensor promptly of the first achievement of each of the Commercial Milestone Events. In the event that, notwithstanding the fact that Licensee has not provided Licensor such a notice, Licensor believes that any such Commercial Milestone Event has been achieved, it shall so notify Licensee in writing and the Parties shall promptly meet and discuss in good faith whether such Commercial Milestone Event has been achieved. For determination of any Commercial Milestone Event, any Net Sales made in a currency other than Euros will be converted to Euros in accordance with Section 5.5. Any dispute under this Section 5.2 regarding whether or not such a Commercial Milestone Event has been achieved shall be subject to resolution in accordance with Section 11.6.

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5.3.Royalties.

5.3.1.Royalty Rates. In consideration of the rights granted to Licensee hereunder, subject to Section 5.3.2, Licensee shall pay to Licensor tiered royalties on increments of annual Net Sales of the Licensed Product during each Calendar Year at the following rates:

Portion of aggregate Net Sales of all Licensed Product in the Territory during a Calendar Year	Royalty Rate
Less than or equal to [***] Euros (€[***])	[***] percent ([***]%)
Greater than [***] Euros (€[***]) but less than or equal to [***] Euros (€[***])	[***] percent ([***]%)
Greater than [***] Euros (€[***]) but less than or equal to [***] Euros (€[***])	[***] percent ([***]%)
Greater than [***] Euros (€[***])	[***] percent ([***]%)

5.3.2.Royalty Term. Licensee shall have no obligation to pay any royalty with respect to Net Sales of Licensed Product in any country with respect to any period after the Royalty Term in such country has expired, and any Net Sales of Licensed Product in any country with respect to any period after the Royalty Term in such country has expired shall be excluded for purposes of calculating the applicable royalty rate in Section 5.3.1.

5.4.Royalty Payments and Reports. Royalties under Section 5.3 shall be calculated and reported by Licensee to Licensor each month within [***] of the last day of each [***]. [***] shall be paid within [***] after [***]. Each such payment shall be accompanied or preceded by a report of Net Sales and royalties in sufficient detail to permit confirmation of the accuracy of the royalty calculation, including gross sales and Net Sales of Licensed Product on a Market-by-Market basis, any applicable adjustments made pursuant to the definition of Net Sales (including in relation to Combination Products), the amounts payable, and the exchange rates used. Without limiting the generality of the foregoing, Licensee shall require its Affiliates and Sublicensees to account for their Net Sales and to provide such reports with respect thereto as necessary for Licensee to comply with this Section 5.4. In addition to the foregoing reports of Net Sales, commencing with the Calendar Year in which the First Commercial Sale of the first Licensed Product occurs in any Market, and continuing for each Calendar Year during the Royalty Term, no later than August 1 of each Calendar Year Licensee shall [***]. For any Net Sales made in a currency other than Euros, such currency will be converted to Euros in accordance with Section 5.5.

5.5.Mode of Payment; Offsets. All payments to Licensor under this Agreement shall be made, subject to receipt by Licensee of the relevant invoice, by deposit of Dollars in the

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requisite amount to such bank account as Licensor may from time to time designate to Licensee under the relevant invoice. For the purpose of calculating any sums due under, or otherwise reimbursable pursuant to, this Agreement (including the calculation of Net Sales expressed in currencies other than Dollars), Licensee shall convert any amount expressed in a foreign currency into Dollar equivalents using its, its Affiliate’s or Sublicensee’s, as applicable, standard conversion methodology consistent with GAAP. Unless otherwise expressly set forth in the Supply Agreement, Licensee shall have no right to offset, set off, or deduct any amounts from or against the amounts due to Licensor hereunder.

5.6.Taxes.

5.6.1.General. All amounts payable by Licensee to Licensor under this Agreement, including the upfront payment set forth in Section 5.1, and any milestones and royalties payable by Licensee to Licensor pursuant to this Agreement (each amount payable under this Agreement being a “Payment”) shall be paid free and clear of any and all taxes, duties, levies, imposts, assessments, deductions, fees, and other similar charges (which, for clarity, shall be the responsibility of Licensee), except for income taxes that are required to be withheld or deducted by Applicable Law (“Withholding Taxes”), except as otherwise provided in Section 5.6.2.

5.6.2.Withholding Tax. Prior to making any deduction or withholding in respect of Withholding Taxes from any payment under this Agreement, Licensee shall (i) timely provide a prior written notice to Licensor of the amounts subject to deduction or withholding, and a reasonable description of the legal basis therefore; (ii) inform Licensor in writing of any the forms, certificates or other items that are necessary in order to reduce or eliminate such deduction or withholding; and (iii) provide to Licensor a reasonable opportunity to furnish such forms, certificates or other items that would reduce or eliminate such deduction or withholding. The Parties shall cooperate to minimize Withholding Taxes and take advantage of any applicable tax treaty. If Licensor is entitled under any applicable tax treaty to a reduction of rate of, or the elimination of, applicable Withholding Tax, it may deliver to Licensee or the appropriate Governmental Authority (with the assistance of Licensee to the extent that this is reasonably required) the prescribed forms, certificates or other items necessary to reduce the applicable rate of withholding or to relieve Licensee of its obligation to withhold such Withholding Taxes and Licensee shall apply the reduced rate of withholding or dispense with withholding, as the case may be. In the event that there is no applicable tax treaty, or the Licensor is not entitled to benefits under any applicable tax treaty,or if an applicable tax treaty reduces but does not eliminate Withholding Taxes applicable to a payment under this Agreement Licensee shall, except as otherwise provided in this Section 5.6.2, (1) pay to Licensor the balance when due, (2) make timely payment to the proper taxing authority of the Withholding Taxes and (3) promptly send to Licensor the best available proof of such payment, including official receipts, with reasonable supporting documentation and calculations of such Withholding Taxes sufficient to enable Licensor to claim such payment of Withholding Taxes or otherwise obtain any tax benefit for such Withholding Taxes, and such Withholding Taxes shall be treated for all purposes of this Agreement as

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having been paid to Licensor hereunder. The Parties shall reasonably cooperate to minimize, report and withhold any such Withholding Taxes, including with respect to all documentation required by any taxing authority. If Licensee receives a refund of any such withheld taxes, in whole or in part, and whether in the form of cash, credit or other similar offset, Licensee shall promptly inform Licensor in writing and refund such amount to Licensor. Licensor shall not be liable for any penalties or interest due to the failure of Licensee to properly withhold or remit such any withholding or deductions to the Governmental Authorities, unless and to the extent such failure is due to incorrect or invalid forms, facts, or other similar information given to Licensee by Licensor Notwithstanding anything to the contrary in this Agreement, if Licensee is required to make a Payment to Licensor subject to Withholding Taxes, and if the withholding or deduction of tax required by Applicable Law with respect to Payments under this Agreement arises or is increased solely as a result of action taken by Licensee or its Affiliates or a successor or assignee, including, without limitation, Licensee assigns or transfers some or all of its rights or obligations to any other Person pursuant to Section 11.3 or otherwise, or there is a change, whether by corporate continuance, merger or other means, in the tax residency of Licensee, or payments arise or are deemed to arise through a branch of Licensee (each a “Withholding Tax Action”), and it is not possible for such withholding to be reduced through the cooperation of the Parties prior to the making a Payment, then any amount payable under this Agreement shall be increased to take into account such Withholding Taxes as may be necessary so that, after making all required withholdings (including withholdings on the withheld amounts), Licensor receives an amount equal to the sum it would have received had no such Withholding Tax Action occurred provided that if the Licensor receives credit or repayment in respect of any tax withheld, it shall as soon as reasonably practicable account to the Person who has accounted for the relevant withholding tax for such amount as shall leave the Licensor in no worse position than it would have been in had there been no such deduction or withholding.

5.6.3.Value Added Tax. Notwithstanding anything contained in Section 5.6.1 or Section 5.6.2, this Section 5.6.3 shall apply with respect to any value added, sales, goods, services, turnover, transfer or similar tax and any tax charged on the import or export of any goods or services (“VAT”). All Payments are exclusive of VAT. If any VAT is chargeable in respect of any Payments, transactions or related transfer of rights or other property pursuant to this Agreement, Licensee shall pay VAT at the applicable rate in respect of any such Payments following the receipt of a VAT invoice in the appropriate form issued by Licensor in respect of those Payments, such VAT to be payable at the due date of the relevant invoice received by Licensee.

5.6.4.Foreign Derived Intangible Income. Licensee shall provide, and to cause its Affiliates, subcontractors, sub-licenses, customers and applicable Third Parties to provide, any information and documentation reasonably requested by Licensor, to obtain the benefits of Section 250 of the Internal Revenue Code of 1986, as amended, and the applicable Treasury Regulations including, without limitation, information required to demonstrate the extent to which the Licensed Products will be sold, consumed, used and/

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or manufactured outside the United States. The Parties recognize and agree that such information and documentation shall not disclose the identities or addresses of any customers (other than jurisdiction).

5.6.5.German Withholding Tax. In the event that any payment to be made by Licensee to Licensor under this Agreement is subject to any German withholding tax, then the Parties shall cooperate in good faith in order to reduce or eliminate such withholding tax to the extent permitted under German Income Tax Act. Notwithstanding anything to the contrary, Section 5.6.2 shall apply, mutatis mutandis, to any Withholding Taxes under German tax laws.

5.7.Interest on Late Payments. If any payment due to either Party under this Agreement is not paid when due, then such paying Party shall pay interest thereon (before and after any judgment) at an annual rate (but with interest accruing on a daily basis) of [***] ([***]) basis points above the London Interbank Offered Rate for deposits in United States Dollars having a maturity of one (1) month published by the British Bankers’ Association, as adjusted from time to time on the first London business day of each month, such interest to run from the date on which payment of such sum became due until payment thereof in full together with such interest.

5.8.Financial Records. Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, keep complete and accurate financial books and records pertaining to the Commercialization of Licensed Product hereunder, including books and records of Net Sales, in sufficient detail to calculate and verify all amounts payable hereunder. Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, retain such books and records for three (3) Calendar Years after the end of the Calendar Year to which such books and records pertain.

5.9.Audit. At the request of Licensor, no more than once each Calendar Year, Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, permit an independent certified public accounting firm of international standing designated by Licensor and reasonably acceptable to Licensee (the “Auditor”), at reasonable times and upon at least thirty (30) days’ prior written notice, to audit the books and records maintained pursuant to Section 5.8 in the location where such books and records are maintained, solely to confirm payments due by Licensee hereunder, including in respect of Net Sales, Commercial Milestone payments and royalties for a period covering not more than the three (3) Calendar Years preceding the relevant payments made. No Calendar Year shall be subject to audit under this Section 5.9 more than once. The Auditor will execute a reasonable written confidentiality agreement with Licensee and will disclose to Licensor only such information as is reasonably necessary to provide Licensor with the outcome of the audit regarding any actual or potential discrepancies between amounts reported and actually paid and amounts payable under this Agreement. The Auditor will send a copy of the report to Licensee at the same time it is sent to Licensor. The report sent to both Parties will include the methodology and calculations used to determine the results. If any of the counterparties to the Upstream Agreements have the right to undertake audits of Licensee, its Affiliates, and its and their Sublicensees in accordance with the terms of the Upstream Agreements, Licensee shall permit an independent certified public

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accounting firm of international standing designated by Licensor and reasonably acceptable to Licensee to undertake such audits as required by the relevant Upstream Agreement provided that Licensor shall use its Commercially Reasonable Efforts to combine the audits so that the audits required by the counterparties to the Upstream Agreements will take place at the same time as the audits undertaken by Licensor pursuant to this Section 5.9. Licensor shall bear the full cost of such audit, unless the audit reveals an underreporting or underpayment by Licensee by more than five percent (5%) of the amount due for any Calendar Year, in which case Licensee shall bear the cost of the audit. Unless disputed pursuant to Section 5.9 below, if such audit concludes that (a) additional amounts were owed by Licensee, Licensee shall pay the additional amounts, with interest from the date originally due as provided in Section 5.7, or (b) excess payments were made by Licensee, Licensor shall reimburse such excess payments, in either case ((a) or (b)), within sixty (60) days after the date of the relevant invoice to be sent after the date on which the Auditor’s report is delivered to Licensee.

5.10.Audit Dispute. In the event of a dispute with respect to any audit under Section 5.9, Licensor and Licensee shall work in good faith to resolve the disagreement. If the Parties are unable to reach a mutually acceptable resolution of any such dispute within thirty (30) days, the dispute shall be submitted for resolution to an independent certified public accounting firm of international standing, other than the Auditor that conducted the audit under Section 5.9, jointly selected by each Party’s certified public accountants (the “Dispute Auditor”). The decision of the Dispute Auditor shall be final and the costs of such proceeding as well as the initial audit shall be borne between the Parties in such manner as the Auditor shall determine.Not later than ten (10) days after such decision and in accordance with such decision, Licensee shall pay the additional amounts, with interest from the date originally due as provided in Section 5.7, or Licensor shall reimburse the excess payments, as applicable.

ARTICLE 6
INTELLECTUAL PROPERTY

6.1.Ownership of Intellectual Property.

6.1.1.Background Intellectual Property. As between the Parties, each Party shall own and retain all right, title and interest in and to any and all Information, Inventions, Patents and other intellectual property rights that, in each case, are owned or controlled (other than pursuant to the license grants set forth in Section 2.1 and Section 2.2) by such Party or its Affiliates or its or their (sub)licensees (or Sublicensees) (as applicable) outside of this Agreement, including, in the case of Licensor, the Licensed Know-How and the Licensed Patents.

6.1.2.AstraZeneca Product IP. Licensee acknowledges that, under the MedImmune License, Licensor has agreed that MedImmune shall own and retain all right, title and interest in and to any and all AstraZeneca Product Improvements, AstraZeneca Product Know-How, and AstraZeneca Product Patents, Licensed Know-How (to the extent it is not PhaseBio Know-How as defined in the MedImmune License) and Licensed Patents (to the extent they are not PhaseBio Patents as defined in the MedImmune License) (collectively, the “AstraZeneca Product IP”). Therefore,

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Licensee shall, and does hereby, assign to Licensor and will cause each of its officers, directors, employees and Affiliates, and its and their Sublicensees, to assign to Licensor all right, title and interest in and to all AstraZeneca Product IP, without additional compensation, as is necessary for Licensor to assign the same to MedImmune and to fully effect MedImmune’s sole ownership provided for in the first sentence of this Section 6.1.2.

6.1.3.Licensor Intellectual Property. As between the Parties, subject to Section 3.3 Licensor shall own and retain all right, title and interest in and to:

(a)any and all Information that is Controlled by Licensee or any of its Affiliates as of the Effective Date or at any time during the Term and directed to any Licensed Compound or Licensed Product and that: (i) is conceived or developed by Licensor or any of its Affiliates or any of its or their Sublicensees in the course or as a result of the Development, Manufacture or other Exploitation of any Licensed Compound or Licensed Product; or (ii) both: (A) is conceived or developed by a Third Party contractor on behalf of Licensor or any of its Affiliates or any of its or their Sublicensees in the course or as a result of Development, Manufacture or other Exploitation of any Licensed Compound or Licensed Product, and (B) is Controlled by Licensor or any of its Affiliates or any of its or their Sublicensees; or (iii) [***]; or (iv) [***]; and (v) [***]; and

(b)any Patents that claim Licensed Know-How described in Section 6.1.3(a).

Licensee hereby assigns and shall cause its Affiliates and their respective employees, agents and consultants to assign, to Licensor any and all right, title and interest Controlled by Licensee, its Affiliates and their respective employees, agents, consultants and Third Party contractors to effectuate the provisions regarding ownership set out in this Section 6.1.3.

6.1.4.Licensee Intellectual Property. As between the Parties (except for [***]), Licensee shall own and retain all right, title and interest in and to all Licensee Improvements. Licensee shall promptly notify Licensor in writing of any Licensee Improvements.

6.1.5.Licensor Improvements. [***] Licensor shall own all Improvements (other than AstraZeneca Product IP) invented or developed by or on behalf of (a) Licensor or (b) except [***], Licensee (including their respective Affiliate’s employees, contractors and/or agents) or jointly by such parties except for [***] (“Licensor Improvements”). [***]. The following provisions shall apply [***]:

(a)[***].

(b)[***].

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(c)[***].

(d)[***].

(e)[***].

(f)[***].

(g)[***].

(h)[***].

For the avoidance of any doubt, [***].

6.1.6.Inventions. Subject to Section 6.1.2, ownership of all Inventions (other than AstraZeneca Product IP) shall follow inventorship as determined in accordance with U.S. patent laws, such that each Party shall solely own all Inventions (other than AstraZeneca Product IP) invented or developed solely by or on behalf of such Party (including its and its Affiliate’s employees, contractors and/or agents).

6.1.7.United States Law. The determination of whether any Invention is conceived, discovered, developed or otherwise made by a Party for the purpose of allocating proprietary rights (including Patent, copyright or other intellectual property rights) therein, shall, for purposes of this Agreement, be made in accordance with Applicable Law in the United States in effect at the time of such conception, discovery, development or making, irrespective of where the same occurs.

6.1.8.Assignment Obligation.

(a)Employees, Consultants and Third Party Contractors of Licensee and its Affiliates.

(i)AstraZeneca Product Improvements. Licensee shall cause each employee, individual consultant and Third Party contractor that Licensee or its Affiliate proposes to engage to conduct activities involving the AstraZeneca Product, including any use of the Ticagrelor Compound, any AstraZeneca Product or any AstraZeneca Product Know-How under or in connection with this Agreement on behalf of Licensee or its Affiliates (excluding Licensor and its Affiliates) who conceives, discovers, develops or otherwise makes any AstraZeneca Product Improvement under or in connection with activities conducted pursuant to this Agreement to be under an obligation to assign to Licensee their rights in any such AstraZeneca Product Improvement. If (A) Licensee is unable to cause such Third Party contractor or consultant (including any contractor who is, or a consultant who is employed by, a governmental, not-for-profit, or public institution that has standard policies against such an assignment) to agree to such assignment obligation with respect to

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AstraZeneca Product Improvements despite Licensee’s using commercially reasonable efforts to negotiate such assignment obligation, or (B) Applicable Law would prohibit Licensee from requiring such an assignment from such Third Party contractor or consultant, in each case ((A) and (B)) Licensee shall refrain from using such Third Party contractor or consultant to conduct activities pursuant to this Agreement unless both Licensor and MedImmune consent in writing, such consent by Licensor not to be unreasonably withheld, conditioned or delayed and Licensor shall use Commercially Reasonable Efforts to seek MedImmune’s consent. Licensor shall respond to any such request for consent within sixty (60) days. Licensee shall require its and its Affiliates’ Sublicensees to be subject to the obligations set forth in this Section 6.1.8(a)(i) to the same extent as Licensee.

(ii)Information and Inventions Other than AstraZeneca Product Improvements. Except with respect to any AstraZeneca Product Improvement, which shall be governed by Section 6.1.8(a)(i), Licensee shall cause each employee and individual consultant (excluding Licensor and its Affiliates) of Licensee or its Affiliates (but excluding Third Party contractors of Licensee and its Affiliates, which are separately addressed in Section 6.1.8(b)) who conceives, discovers, develops or otherwise makes (i) any Information that is directed to a Licensed Compound or Licensed Product and was not previously in the public domain or (ii) any other Invention directed to a Licensed Compound or Licensed Product (but, in each case ((i) and (ii)), excluding any AstraZeneca Product Improvement), in connection with activities conducted relating to this Agreement to be under an obligation to assign to Licensee their rights in any such Information or other Invention. In the case of any consultant of Licensee or its Affiliates (excluding Licensor and its Affiliates and Licensee’s and its Affiliates’ Third Party contractors), if Licensee is unable to cause such consultant to agree to such assignment obligation despite Licensee using commercially reasonable efforts to negotiate such assignment obligation, then Licensee shall either: (A) cause such consultant to grant an exclusive, worldwide license, with the right to sublicense through multiple tiers, under their rights in such Information or other Invention to Exploit the Licensed Compounds and Licensed Productin the Field, except where Applicable Law requires otherwise and except in the case of consultants who are employed by governmental, not-for-profit, or public institutions that have standard policies against such an assignment (in which case, Licensee shall use commercially reasonable efforts to obtain a suitable license, or right to obtain such a license); or (B) refrain from using such consultant to conduct activities pursuant to this Agreement unless both Licensor and MedImmune consent in writing, such consent by Licensor not to be unreasonably withheld, conditioned or delayed and Licensor shall use Commercially Reasonable Efforts to seek

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MedImmune’s consent. Licensor shall respond to any such request for consent within forty-five (45) days. Licensee shall require its and its Affiliates’ Sublicensees to be subject to the obligations set forth in this Section 6.1.8(a)(ii) to the same extent as Licensee.

(b)Third Party Contractors. Except with respect to any AstraZeneca Product Improvement, which shall be governed by Section 6.1.8(a)(i), Licensee shall use commercially reasonable efforts to obtain from each Third Party contractor that Licensee or its Affiliate proposes to engage to conduct activities under or in connection with this Agreement on behalf of Licensee or its Affiliates an assignment, an exclusive license, or a non-exclusive license (in order of preference), with the right to sublicense through multiple tiers, to Licensee of (i) any Information that is directed to a Licensed Compound or Licensed Product and was not previously in the public domain or (ii) any other Invention directed to a Licensed Compound or Licensed Product, that, in each case ((i) and (ii)), such Third Party contractor conceives, discovers, develops or otherwise makes in connection with activities conducted relating to this Agreement. The Parties acknowledge that it may not be possible to obtain such assignment or license from any such Third Party contractor on terms acceptable to Licensee or at all (e.g., technology of broad applicability to the operation of such Third Party contractor’s business, or improvements to such Third Party contractor’s own proprietary technology used in the performance of services on behalf of Licensee or its Affiliate), and accordingly, the Parties agree that the inability of Licensee or its Affiliate, despite the use of commercially reasonable efforts, to obtain such assignment or license from a Third Party contractor on terms acceptable to Licensee or at all shall not constitute a breach of Licensee’s obligations under this Agreement. Licensee shall require its and its Affiliates’ Sublicensees to be subject to the obligations set forth in this Section 6.1.8(b) to the same extent as Licensee.

6.1.9.Ownership of Licensee Corporate Names and Licensed Trademarks. As between the Parties, Licensee shall own all right, title and interest to the Licensee Corporate Names and the Licensed Trademarks in the Territory.

6.1.10.Ownership of Licensor Corporate Names, Licensed Trademarks and MedImmune Corporate Names. As between the Parties, Licensor shall retain all right, title and interest in and to the Licensor Corporate Names and the Licensed Trademarks. Licensee acknowledges that, under the MedImmune License, MedImmune retains all right, title and interest in and to the MedImmune Corporate Names and any Trademarks with respect to any AstraZeneca Product (other than Generic Ticagrelor Products).

6.2.Maintenance and Prosecution of Patents.

6.2.1.Licensee Patent

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(a)As between the Parties, Licensee shall have the first right, but not the obligation, to prepare, file, prosecute and maintain the Licensee Patents, including directing any related interference, re-issuance, re-examination and opposition proceedings with respect thereto, worldwide, in each case, at its sole cost and expense and through counsel of its choice.

(b)Licensee shall keep Licensor reasonably informed of progress with regard to the preparation, filing, prosecution and maintenance of the Licensee Patents, as applicable, in the Territory, including by providing Licensor with a copy of material communications to and from any patent authority in the Territory regarding such Patents and by providing Licensor drafts of any material filings or responses to be made to such patent authorities sufficiently in advance of submitting such filings or responses so as to allow for a reasonable opportunity for Licensor to review and comment thereon. Licensee shall consider in good faith the requests and suggestions of Licensor with respect to such drafts and with respect to strategies for filing and prosecuting such Licensee Patents in the Territory.

(c)If, as between the Parties, Licensee decides not to prepare, file, prosecute or maintain a Licensee Patent in a country in the Territory, Licensee shall provide reasonable prior written notice to Licensor of such intention and Licensor shall thereupon have the right, in its sole discretion, to assume the Control and direction of the preparation, filing, prosecution and maintenance of such Licensee Patent at its sole cost and expense in such country, provided that Licensor shall use a reputable, outside counsel mutually agreed to by the Parties, such agreement not to be unreasonably withheld, conditioned or delayed, and, with respect to any AstraZeneca Product References in connection with the filing, prosecution or maintenance of any such Patents, using only factual statements supported by the approved label for the AstraZeneca Product or presenting a balanced view of the AstraZeneca Product considering the approved label thereof as a whole.

6.2.2.Licensed Patents.

(a)As between the Parties, Licensor shall have the first right, but not the obligation, to prepare, file, prosecute and maintain the Licensed Patents, including directing any related interference, re-issuance, re-examination and opposition proceedings with respect thereto, worldwide, in each case, at its sole cost and expense and through counsel of its choice. Licensee shall use Commercially Reasonable Efforts, consistent with Applicable Law, to make employee inventors available to Licensor for consultation from time to time to facilitate Licensor’s prosecution of the Licensed Patents.

(b)Licensor shall keep Licensee reasonably informed of progress with regard to the preparation, filing, prosecution and maintenance of the Licensed Patents, as applicable, in the Territory, including by providing Licensee with a

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copy of material communications to and from any patent authority in the Territory regarding such Patents and by providing Licensee drafts of any material filings or responses to be made to such patent authorities sufficiently in advance of submitting such filings or responses so as to allow for a reasonable opportunity for Licensee to review and comment thereon. Licensor shall consider in good faith the requests and suggestions of Licensee with respect to such drafts and with respect to strategies for filing and prosecuting such Licensed Patents in the Territory.

(c)If, as between the Parties, Licensor decides not to prepare, file, prosecute or maintain a Licensed Patent in a country in the Territory, Licensor shall provide reasonable prior written notice to Licensee of such intention and Licensee shall thereupon have the right, in its sole discretion, to assume the Control and direction of the preparation, filing, prosecution and maintenance of such Licensed Patent at its sole cost and expense in such country, provided that Licensee shall use a reputable, outside counsel mutually agreed to by the Parties, such agreement not to be unreasonably withheld, conditioned or delayed, and, with respect to any AstraZeneca Product References in connection with the filing, prosecution or maintenance of any such Patents, using only factual statements supported by the approved label for the AstraZeneca Product or presenting a balanced view of the AstraZeneca Product considering the approved label thereof as a whole.

6.2.3.AstraZeneca Product Patents. The Parties acknowledge that under the MedImmune License, MedImmune retains the sole right, but not the obligation, to prepare, file, prosecute and maintain the AstraZeneca Product Patents, including directing any related interference, re-issuance, re-examination and opposition proceedings with respect thereto, worldwide, in each case, at its sole cost and expense and through counsel of its choice.

6.2.4.Cooperation. The non-prosecuting Party shall, and as necessary shall cause its Affiliates to, assist and cooperate with the prosecuting Party (and in the case of AstraZeneca Product Patents, assist and cooperate with MedImmune), as the prosecuting Party may reasonably request from time to time, in the preparation, filing, prosecution and maintenance of the Licensed Patents and AstraZeneca Product Patents, as applicable. Without limiting the foregoing, the non-prosecuting Party shall, and as necessary shall ensure that its Affiliates, (a) offer its comments, if any, promptly and (b) provide access to relevant documents and other evidence and make its employees available at reasonable business hours; provided, however, that neither Party shall be required to provide legally privileged information with respect to such intellectual property unless and until procedures reasonably acceptable to such Party are in place to protect such privilege; and provided, further, that the prosecuting Party shall reimburse the non-prosecuting Party for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith.

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6.2.5.Patent Term Extension and Supplementary Protection Certificate.

(a)The Parties shall attempt tomake decisions by mutual agreement regarding patent term extensions and supplementary protection certificates in the Territory with respect to any extensions that are now or become available in the future, wherever applicable, for the Licensed Patents and/or the Licensee Patents with respect to Licensed Compounds and Licensed Product, in each case including whether or not to so apply. If, with respect to any such Licensed Patents and/or and the Licensee Patents, the Parties cannot agree on which Licensed Patents and/or and the Licensee Patents as to which the term is to be extended in such country, then [***].

(b)For clarity, Licensor shall have the sole right to make decisions regarding, and shall have the sole right to apply for, patent term extensions outside the Territory.

6.2.6.Common Ownership Under Joint Research Agreements. Notwithstanding anything to the contrary in this Article 6, neither Party shall have the right to make an election under 35 U.S.C. 102(c) when exercising its rights under this Article 6 without the prior written consent of the other Party. With respect to any such permitted election, the Parties shall coordinate their activities with respect to any submissions, filings or other activities in support thereof. The Parties acknowledge and agree that this Agreement is a “joint research agreement” as defined in 35 U.S.C. 100(h).

6.3.Enforcement of Patents.

6.3.1.Notice. In the event that either Party receives notice of (a) any alleged or threatened infringement of the Licensed Patents or in any jurisdiction in the Territory or (b) any certification filed in any jurisdiction in the Territory that is equivalent or similar to a certification filed in the U.S. under the BPCI Act claiming that any Licensed Patents are invalid or unenforceable or claiming that any Licensed Patents would not be infringed by the making, having made, use, offer for sale, sale or import of a product (an “Infringement”), such Party shall promptly notify the other Party in writing of such Infringement.

6.3.2.Licensed Patents. As between the Parties, Licensor shall have the first right, but not the obligation, to prosecute Infringement in the Territory with respect to the Licensed Patents, including as a defense or counterclaim in connection with any Third Party Infringement Claim, at Licensor’s sole cost and expense, using reputable, outside counsel mutually agreed to by the Parties, such agreement not to be unreasonably withheld, conditioned or delayed, and, with respect to any AstraZeneca Product References in connection with the prosecution of Infringement with respect to any such Patents, using only factual statements contained in the approved label for the AstraZeneca Product or otherwise approved by Licensor and MedImmune in writing. In the event Licensor prosecutes any such Infringement, Licensee and MedImmune shall have the right to join as a party to such claim, suit or proceeding and participate with its own

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counsel at its sole cost and expense and the Parties shall consult prior to doing so; provided that Licensor shall retain control of the prosecution of such claim, suit or proceeding, including the response to any defense or defense of any counterclaim raised in connection therewith. If Licensor or its designee does not take and continue to pursue commercially reasonable steps to prosecute an Infringement with respect to the Licensed Patents in the Field in the Territory within thirty (30) days following the date upon which Licensor first receives notice or otherwise learns of such Infringement or such shorter period as may be necessary to preserve Licensor’s rights to prosecute such Infringement effectively, unless the Parties otherwise agree in writing, or, provided such date occurs after Licensor receives notice or otherwise learns of such Infringement, ten (10) Business Days before the time limit, if any, set forth in Applicable Law for filing of such actions, whichever comes first, then (i) Licensor shall so notify Licensee and, (ii) Licensee may prosecute such alleged or threatened Infringement at its sole cost and expense.

6.3.3.AstraZeneca Product Patents. The Parties acknowledge that under the MedImmune License, MedImmune retains the sole right, but not the obligation, to prosecute Infringement with respect to the AstraZeneca Product Patents, including as a defense or counterclaim in connection with any Third Party Infringement Claim, at MedImmune’s sole cost and expense, using counsel of its choice.

6.3.4.Cooperation.

(a)The Parties agree to cooperate fully in any Infringement action pursuant to this Section 6.3 with respect to any Licensed Patents, including by making the inventors, applicable records, and documents (including laboratory notebooks) with respect to the relevant Patents available to the enforcing Party on the enforcing Party’s request. With respect to any such action controlled by the applicable enforcing Party, the other Party shall, and as necessary shall cause its Affiliates to, assist and cooperate with the enforcing Party, as the enforcing Party may reasonably request from time to time, in connection with its activities set forth in this Section 6.3, including, where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence, and making its employees available at reasonable business hours; provided thatthe enforcing Party shall reimburse such other Party for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith.

(b)Unless otherwise set forth herein, the enforcing Party shall have the right to settle such claim; provided that neither Party shall have the right to settle any Infringement litigation under this Section 6.3 in a manner that reasonably may have a material adverse effect on the rights or interest of the other Party or its Affiliates (including, in the case of Licensor as the other Party, a material adverse effect on the AstraZeneca Product) or in a manner that imposes any costs or liability on, or involves any admission by, the other Party, without

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the express written consent of such other Party (which consent shall not be unreasonably withheld, conditioned or delayed).

(c)The Parties acknowledge that under the MedImmune License, MedImmune retains the sole and absolute discretion to settle any claims with respect to the AstraZeneca Product or any AstraZeneca Product Patent, without consultation with Licensor and without regard to the effect of such settlements on any Licensed Product (provided that, if any such settlement of claims with respect to any AstraZeneca Product also involves a settlement of claims with respect to any Licensed Product, Licensor will use its Commercially Reasonable Efforts to ensure that MedImmune agrees not to settle any claims specifically with respect to the Licensed Product in a manner that would impose any costs or liability on, or involves any admission by, Licensor, without the express written consent of Licensor).

(d)In connection with any activities with respect to an Infringement action prosecuted by the applicable enforcing Party pursuant to this Section 6.3 involving Licensed Patents, the enforcing Party shall (i) consult with the other Party as to the strategy for the prosecution of such claim, suit, or proceeding, (ii) consider in good faith any comments from the other Party with respect thereto, and (iii) keep the other Party reasonably informed of any material steps taken, and provide copies of all material documents filed, in connection with such action.

6.3.5.Recovery. Except as otherwise agreed by the Parties in connection with a cost sharing arrangement, any recovery realized as a result of such litigation described above in this Section 6.3 (whether by way of settlement or otherwise) shall be first allocated to reimburse the Parties for their costs and expenses in making such recovery (which amounts shall be allocated pro rata if insufficient to cover the totality of such expenses). Any remainder after such reimbursement is made shall be retained by the enforcing Party; provided, however, that any recovery realized by Licensee as a result of any action brought and controlled by Licensee with respect to a Licensed Patent pursuant to Section 6.3.2 shall be allocated as follows: (a) compensatory damages shall: (i) if awarded as lost sales, be treated as Net Sales of Licensed Product in the quarter in which such recovery is received for purposes of Section 5.3; and (ii) if not awarded as lost sales, be treated as profits or royalties, as appropriate, and shall be used to determine lost sales, which lost sales shall be treated as Net Sales of Licensed Product for purposes of Section 5.3 in the quarter in which such recovery is received, provided that in no event shall Licensor be obligated to pay to Licensee more than [***]% of any damages described in this clause (ii).

6.3.6.Biosimilar Applicants. If either Party receives a copy of an application for a Biosimilar Product in the Territory referencing a Licensed Product, or otherwise becomes aware that such an application has been submitted to a Regulatory Authority for Regulatory Approval in the Territory (such as in an instance described in the Biosimilar Regulations), then this Section 6.3.6 shall apply, and, within ten (10) Business Days, such

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Party shall notify the other Party. The Party that is not the “reference product sponsor,” as defined in the Biosimilar Regulations, shall have the right, but not the obligation, to seek permission or take other steps necessary to view the application and related confidential information from the filer of the application for a Biosimilar Product (“Biosimilar Filer”) to the extent permitted under the Biosimilar Regulations. Regardless of the Party that is the “reference product sponsor” for purposes of such Biosimilar Product application:

(a)Licensee shall have the sole right to manage and prosecute biosimilar litigation in the Territory, subject to the provisions of this Section 6.3.6.

(b)Licensee will have the sole right to designate pursuant to the Biosimilar Regulations the outside counsel and in-house counsel who will receive confidential access to the Biosimilar Product application in the Territory and manufacturing process information of the Biosimilar Filer in the Territory.

(c)Licensee shall have the sole right to (i) list any Patents, including those licensed hereunder, insofar as they claim or cover the applicable Licensed Product in the Territory as required pursuant to the Biosimilar Regulations, (ii) respond to any communications with respect to such lists from the Biosimilar Filer in the Territory, and (iii) negotiate with the Biosimilar Filer in the Territory as to whether to utilize a mechanism for information exchange other than that specified in the Biosimilar Regulations and as to the Patents that will be subject to the initial litigation procedure as described in the Biosimilar Regulations, to decide which Patent or Patents shall be selected for initial litigation under the Biosimilar Regulations.

(d)Licensee shall consult with Licensor prior to identifying any Licensed Patents or Licensee Patents to a Biosimilar Filer as contemplated by this Section 6.3.6. Licensee shall consider in good faith advice and suggestions with respect thereto received from Licensor, and notify Licensor of any such lists or communications promptly after they are made, in each case to the extent permitted by Applicable Law.

(e)Without limitation to the foregoing clauses ((a)-(d)), if a Party receives a notice of commercial marketing from any Biosimilar Filer in the Territory pursuant to the Biosimilar Regulations, such Party shall, within ten (10) Business Days of receiving any such notice, notify the other Party and provide the other Party with copies thereof. Thereafter, the Party controlling any action pursuant to this Section 6.3.6 shall have the first right to seek a preliminary injunction action or a declaratory judgment action pursuant to the Biosimilar Regulations, in which event the Parties shall be subject to Section 6.3.4 and Section 6.3.5, to the extent applicable, as if such action had been commenced pursuant to Section 6.3.2. If no such litigation is ongoing at the time of such notice, then Licensee will have the first right to seek such an injunction.

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(f)If Licensee elects not to exercise its rights specified in this Section 6.3.6, it shall notify Licensor reasonably in advance of the time limits specified for any application for a Biosimilar Product (and in any event within such period as may be necessary to preserve Licensor’s rights to exercise such rights), then, to the extent permissible under the Biosimilar Regulations, Licensor may thereafter elect to exercise those rights with respect to that application for a Biosimilar Product, at Licensor’s sole expense. Licensee shall use its commercially reasonable efforts to enable Licensor to exercise such rights to the maximum extent permitted by Applicable Law, including to provide Licensor with drafts of any lists or communications described in the foregoing clauses (b) or (c) prior to providing such lists or communications to the Biosimilar Filer, consider in good faith advice and suggestions with respect thereto received from Licensor, notify Licensor of the provision to the Biosimilar Filer of any such lists or communications promptly after they are made and take such other actions with respect to the Biosimilar Filer on behalf of Licensor as may be necessary to give effect to the foregoing rights of Licensor; provided that Licensor shall reimburse Licensee for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith.

(g)The Parties recognize that procedures other than those set forth above may apply with respect to applications for Biosimilar Products. In the event that the Parties determine that certain provisions of Applicable Law in any country in the Territory apply to actions taken by the Parties with respect to applications for Biosimilar Products in such country, the Parties shall comply with any such Applicable Law in such country (and any relevant and reasonable procedures established by Parties) in exercising their rights and obligations with respect to applications for Biosimilar Products under this Section 6.3.6. The Party that does not control the actions contemplated by this Section 6.3.6 shall cooperate with the controlling Party in implementing any decisions that the controlling Party elects to take pursuant to this Section 6.3.6.

6.4.Infringement Claims by Third Parties. If the Development or Commercialization of a Licensed Product in the Territory pursuant to this Agreement results in any claim, suit or proceeding by a Third Party against Licensee or any of its Affiliates or its or their Sublicensees alleging infringement (a “Third Party Infringement Claim”), including any defense or counterclaim in connection with an Infringement action initiated by Licensee or any of its Affiliates pursuant to Section 6.3.2, Licensee shall promptly notify Licensor thereof in writing. Except as provided in Section 9.3.2, as between the Parties, Licensor shall have the first right to defend against any such claim, suit or proceeding at its sole cost and expense, using reputable, outside counsel mutually agreed to by the Parties, such agreement not to be unreasonably withheld, conditioned or delayed, and, with respect to any AstraZeneca Product References in connection with the defense of any such claim, suit or proceeding with respect to a Licensed Patent, using only factual statements contained in the approved label for the AstraZeneca Product or otherwise approved by Licensor and MedImmune in writing; provided that Licensee shall respond to any request to use an AstraZeneca Product Reference in

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connection with any such defense within ten (10) days of receipt of such request. Licensee and MedImmune may participate in any such claim, suit or proceeding with counsel of its choice at its sole cost and expense; provided that Licensor shall retain the right to control such claim, suit or proceeding. Licensee shall, and as necessary shall cause its Affiliates to, assist and cooperate with Licensor, as Licensor may reasonably request from time to time, in connection with its activities set forth in this Section 6.4, including, where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence, and making its employees available at reasonable business hours; provided that Licensor shall reimburse Licensee for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith. Licensor shall keep Licensee reasonably informed of all material developments in connection with any such claim, suit or proceeding. Licensor agrees to provide Licensee with copies of all material pleadings filed in such action and to allow Licensee reasonable opportunity to participate in the defense of the claims. Any damages, or awards, including royalties incurred or awarded in connection with any Third Party Infringement Claim defended by Licensor under this Section 6.4 shall be borne by Licensor. If Licensor or its designee does not take commercially reasonable steps to defend against such claim, suit or proceeding within ninety (90) days following the date upon which Licensor first receives notice or otherwise learns of such Third Party Infringement Claim or, provided such date occurs after Licensor receives notice or otherwise learns of such Third Party Infringement Claim, ten (10) Business Days before the time limit, if any, set forth in Applicable Law for filing of such actions, whichever comes first, then (a) Licensor shall so notify Licensee and (b) Licensee may defend against such Third Party Infringement Claim at its sole cost and expense. For clarity, except as provided in Section 9.3.2, as between the Parties, Licensee and its Affiliates shall have and retain the right to defend against any claim, suit or proceeding brought against Licensee or any of its Affiliates.

6.5.Invalidity or Unenforceability Defenses or Actions.

6.5.1.Notice. Each Party shall promptly notify the other Party in writing of any alleged or threatened assertion of invalidity or unenforceability of any of the Licensed Patents anywhere in the world by a Third Party of which such Party becomes aware.

6.5.2.Licensed Patents. Except as provided in Section 9.3.2, as between the Parties, Licensor shall have the first right, but not the obligation, to defend and control the defense of the validity and enforceability of the Licensed Patents at its sole cost and expense, using reputable, outside counsel mutually agreed to by the Parties, such agreement not to be unreasonably withheld, conditioned or delayed; including, when such invalidity or unenforceability is raised as a defense or counterclaim in connection with an Infringement action initiated pursuant to Section 6.3; provided that if any such claim is raised as a defense or counterclaim in connection with an Infringement action initiated pursuant to Section 6.3, then the Party controlling such Infringement action shall have the first right to defend and control the defense of the validity and enforceability of the applicable Patents. With respect to any such claim, suit or proceeding with respect to any of the Licensed Patents, Licensee may participate in such claim, suit or proceeding with counsel of its choice at its sole cost and expense; provided that Licensor shall retain

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control of the defense in such claim, suit or proceeding. If Licensor or its designee elects not to defend or control the defense of the Licensed Patents or otherwise fails to initiate and maintain the defense of any such claim, suit or proceeding with respect to the Licensed Patents, then Licensee may conduct and control the defense of any such claim, suit or proceeding at its sole cost and expense. Licensor shall have the sole right, but not the obligation to defend and control the defense of the validity and enforceability of any Licensed Patent outside the Territory at Licensor’s sole cost and expense using counsel of its own choice and Licensee shall have no right to conduct, control or defend any such clam if Licensor fails to initiate or maintain the defense of any such claim, suit or proceeding.

6.5.3.AstraZeneca Product Patents. The Parties acknowledge that under the MedImmune License, MedImmune retains the sole right, but not the obligation, to defend and control the defense of the validity and enforceability of the AstraZeneca Product Patents its sole cost and expense, using counsel of its own choice, including when such invalidity or unenforceability is raised as a defense or counterclaim in connection with an Infringement action initiated pursuant to Section 6.3.

6.5.4.Cooperation. The non-controlling Party in any action pursuant to this Section 6.5 shall, and as necessary shall cause its Affiliates to, assist and cooperate with the controlling Party, as such controlling Party may reasonably request from time to time, in connection with its activities set forth in this Section 6.5, including, where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence, and making its employees available at reasonable business hours; provided thatthe controlling Party shall reimburse the non-controlling Party for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith. In connection with any activities with respect to a defense, claim or counterclaim relating to the Licensed Patents pursuant to this Section 6.5, Licensor shall (a) consult with Licensee as to the strategy for such activities, (b) consider in good faith any comments from Licensee, and (c) keep Licensee reasonably informed of any material steps taken and provide copies of all material documents filed, in connection with such defense, claim or counterclaim.

6.6.Licensed Trademarks.

6.6.1.Prosecution of Licensed Trademarks. Licensor shall have the first right, but not the obligation, to register, prosecute, and maintain the Licensed Trademarks using counsel of its own choice. At any time during which Licensor is exercising this right, all costs and expenses of registering, prosecuting and maintaining the Licensed Trademarks shall be borne solely by Licensor. Licensee shall use Commercially Reasonable Efforts, consistent with Applicable Law, to provide such reasonable assistance as Licensor may request from time to time to facilitate Licensor’s registration, prosecution and maintenance of the Licensed Trademarks in the Territory.

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6.6.2.Licensor shall keep Licensee reasonably informed of progress with regard to the registration, prosecution and maintenance of the Licensed Trademarks, as applicable, including by providing Licensee with a copy of material communications to and from any relevant trademark registration office regarding such Licensed Trademarks and by providing Licensee drafts of any material filings or responses to be made to such trademark offices sufficiently in advance of submitting such filings or responses so as to allow for a reasonable opportunity for Licensee to review and comment thereon. Licensor shall consider in good faith the requests and suggestions of Licensee with respect to such drafts and with respect to strategies for registering and maintaining such Licensed Trademarks in the Territory.

6.6.3.If Licensor decides not to register, prosecute or maintain a Licensed Trademark in a country in the Territory, Licensor shall provide reasonable prior written notice to Licensee of such intention and Licensee shall thereupon have the right, in its sole discretion, to assume the control and direction of the registration, prosecution and maintenance of such Licensed Trademark at its sole cost and expense in such country, provided that Licensee shall use a reputable, outside counsel mutually agreed to by the Parties, such agreement not to be unreasonably withheld, conditioned or delayed.

6.6.4.Enforcement of Licensed Trademarks. Subject to Sections 10.4.2(b) and 10.4.3(b), Licensor shall have the first right, but not the obligation, during the Term to take such action as Licensor deems necessary against a Third Party based on any alleged, threatened or actual infringement, dilution, misappropriation, or other violation of, or unfair trade practices or any other like offense relating to, the Licensed Trademarks by a Third Party in the Territory (“Third Party Trademark Infringement”) at its sole cost and expense and using counsel of its own choice and Licensor shall retain any damages or other amounts collected in connection therewith. If Licensor or its designee does not take and continue to take action against such Third Party Trademark Infringement, Licensee may, by giving notice in writing to Licensor, take such action as Licensee deems necessary against such Third Party Trademark Infringement at its sole cost and expense and using counsel of its own choice and Licensee shall retain any damages or other amounts collected in connection therewith.

6.6.5.Third Party Claims. Subject to Sections 10.4.2(b) and 10.4.3(b), Licensor shall have the first right, but not the obligation, during the Term to defend against and settleany alleged, threatened, or actual claim by a Third Party that the use or registration of the Licensed Trademarks by Licensee or any of its Affiliates or Sublicensees in the Territory infringes, dilutes, misappropriates, or otherwise violates any Trademark or other right of that Third Party or constitutes unfair trade practices or any other like offense or any other claims as may be brought by a Third Party against a Party in connection with the use of the Licensed Trademarks with respect to a Licensed Product in the Territory (“Third Party Trademark Claim”), at its sole cost and expense and using counsel of its choice and any damages or awards, including royalties incurred or awarded in connection with any such claim defended by Licensor under this Section 6.6.5, shall be for the account of Licensor. If Licensor or its designee does not

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take and continue to take action to defend such Third Party Trademark Claim, Licensee may, by giving notice in writing to Licensor, take such action as Licensee deems necessary to defend such Third Party Trademark Claim at its sole cost and expense and using counsel of its own choice and any damages or awards, including royalties incurred or awarded in connection with any such claim defended by Licensee under this Section 6.6.5, shall be for the account of Licensee.

6.6.6.Cooperation. The Parties agree to cooperate fully in any Third Party Infringement or Third Party Claim under this Section 6.6 with respect to any Licensed Trademarks. With respect to any such action controlled by the applicable enforcing or defending Party, the other Party shall, and as necessary shall cause its Affiliates to, assist and cooperate with the enforcing or defending Party, as the enforcing or defending Party may reasonably request from time to time, in connection with its activities set forth in this Section 6.6, including, where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence, and making its employees available at reasonable business hours; provided that the enforcing Party shall reimburse such other Party for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith.

6.7.Corporate Names and Licensed Trademarks.

6.7.1.Licensee shall not, and shall not permit its Affiliates or its or their Sublicensees to, (a) use in their respective businesses, any Trademark that is confusingly similar to, misleading or deceptive with respect to, or that dilutes, any (or any part) of the Licensor Corporate Names, MedImmune Corporate Names or any Trademarks with respect to any AstraZeneca Product anywhere in the world, (b) do any act that endangers, destroys or similarly affects, in any material respect, the value of the goodwill pertaining to the MedImmune Corporate Names or any Trademarks with respect to any AstraZeneca Product anywhere in the world, or (c) attack, dispute or contest the validity of or ownership of the Licensor Corporate Names, MedImmune Corporate Names or any Trademarks with respect to any AstraZeneca Product anywhere in the world or any registrations issued or issuing with respect thereto or any pending registration thereof. Licensee agrees, and shall cause its Affiliates and Sublicensees, to conform (i) to the customary industry standards for the protection of any Licensed Trademarks and to such trademark usage guidelines as Licensor and MedImmune may furnish from time to time with respect to the use of any Licensed Trademarks and (ii) to adhere to and maintain high quality standards with respect to goods sold and services provided under any Licensed Trademarks. For purposes of Sections 6.7.1 and 6.7.2, references to AstraZeneca Product exclude Generic Ticagrelor Products.

6.7.2.Without limitation to the foregoing, the use of any Licensed Trademarks by Licensee, its Affiliates and its and their Sublicensees shall be subject to the terms and conditions of this Agreement, including Sections 4.4.6 and 6.7.1. Each use of any Trademark with respect to the AstraZeneca Product by Licensee, its Affiliates and its and

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their Sublicensees shall be subject to the prior review and approval of Licensor and MedImmune, such approval by Licensor not to be unreasonably withheld, conditioned or delayed and Licensor shall use Commercially Reasonable Efforts to seek approval by MedImmune. Licensee covenants to Licensor that, except as expressly permitted in this Agreement, Licensee and its Affiliates and its or their Sublicensees shall not (a) in connection with the Development or Commercialization of any Licensed Product, use any Licensed Trademark or any other Trademark with respect to the AstraZeneca Product or (b) assist, authorize or enable any Distributor or other Third Party contractor of Licensee, its Affiliates or its or their Sublicensees to use any Licensed Trademark or any other Trademark with respect to the AstraZeneca Product.

ARTICLE 7
CONFIDENTIALITY AND NON-DISCLOSURE

7.1.Confidentiality Obligations. At all times during the Term and for a period of ten (10) years following termination or expiration hereof in its entirety, each Party shall and shall cause its officers, directors, employees and agents to, keep confidential and not publish or otherwise disclose to a Third Party and not use, directly or indirectly, for any purpose, any Confidential Information furnished or otherwise made known to it, directly or indirectly, by the other Party, except to the extent such disclosure or use is expressly permitted by the terms of this Agreement (except that the obligations will survive thereafter with respect to any Confidential Information that constitutes a trade secret under Applicable Law). “ConfidentialInformation” means any technical, business or other information provided by or on behalf of one Party to the other Party in connection with this Agreement, whether prior to, on or after the Effective Date, including information relating to the terms of this Agreement (subject to Section 7.4), information relating to any Licensed Compound or Licensed Product (including the Regulatory Documentation), any Development, Manufacture or Commercialization of any Licensed Compound or Licensed Product, any know-how with respect thereto developed by or on behalf of the disclosing Party or its Affiliates (including Licensed Know-How or Licensee Know-How, as applicable) or the scientific, regulatory or business affairs or other activities of such Party. Notwithstanding the foregoing, (a) the terms of this Agreement shall be deemed to be the Confidential Information of both Parties and both Parties shall be deemed to be the receiving Party and the disclosing Party with respect thereto and (b) any AstraZeneca Product Know-How and any AstraZeneca Product Improvement shall be deemed to be the Confidential Information of Licensor (as between the Parties), and Licensee shall be deemed to be the receiving Party and Licensor shall be deemed to be the disclosing Party with respect thereto. Notwithstanding the foregoing, the confidentiality and non-use obligations under this Section 7.1 with respect to any Confidential Information shall not include any information that the receiving Party can demonstrate by competent evidence:

7.1.1.is or hereafter becomes part of the public domain by public use, publication, general knowledge or the like through no breach of this Agreement by the receiving Party;

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7.1.2.can be demonstrated by documentation or other competent proof to have been in the receiving Party’s possession prior to disclosure by the disclosing Party without any obligation of confidentiality with respect to such information;

7.1.3.is subsequently received by the receiving Party on a non-confidential basis from a Third Party who is not bound by any obligation of confidentiality with respect to such information;

7.1.4.has been published by a Third Party or otherwise enters the public domain through no fault of the receiving Party in breach of this Agreement; or

7.1.5.can be demonstrated by documentation or other competent evidence to have been independently developed by or for the receiving Party without reference to the disclosing Party’s Confidential Information.

Specific aspects or details of Confidential Information shall not be deemed to be within the public domain or in the possession of the receiving Party merely because the Confidential Information is embraced by more general information in the public domain or in the possession of the receiving Party. Further, any combination of Confidential Information shall not be considered in the public domain or in the possession of the receiving Party merely because individual elements of such Confidential Information are in the public domain or in the possession of the receiving Party unless the combination and its principles are in the public domain or in the possession of the receiving Party.

7.2.Permitted Disclosures. Each Party may disclose Confidential Information to the extent that such disclosure is:

7.2.1.made in response to a valid order of a court of competent jurisdiction or other supra-national, federal, national, regional, state, provincial and local governmental or regulatory body of competent jurisdiction or, if in the reasonable opinion of the receiving Party’s legal counsel, such disclosure is otherwise required by law, including by reason of filing with securities regulators; provided,however, that, to the extent practicable under the circumstances, the receiving Party shall first have given notice to the disclosing Party and given the disclosing Party a reasonable opportunity to quash such order or to obtain a protective order or confidential treatment requiring that the Confidential Information and documents that are the subject of such order be held in confidence by such court or agency or, if disclosed, be used only for the purposes for which the order was issued; and provided,further, that the Confidential Information disclosed in response to such court or governmental order shall be limited to that information which is legally required to be disclosed in response to such court or governmental order;

7.2.2.made by or on behalf of the receiving Party in connection with prosecuting or defending litigation; provided,however, that, to the extent practicable under the circumstances, the receiving Party shall first have given notice to the disclosing Party and given the disclosing Party a reasonable opportunity to obtain a protective order requiring

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that the Confidential Information and documents that are the subject of such litigation be held in confidence by the Persons prosecuting or defending such litigation or, if disclosed, be used only for the purposes in connection with such litigation;

7.2.3.made by or on behalf of the receiving Party to the Regulatory Authorities as required in connection with any filing, application or request for Regulatory Approval made consistent with the terms and conditions of this Agreement; provided,however, that reasonable measures shall be taken to assure confidential treatment of such information to the extent practicable and consistent with Applicable Law;

7.2.4.made by or on behalf of the receiving Party to a patent authority as required for purposes of obtaining or enforcing a Patent as permitted by this Agreement; provided, however, that reasonable measures shall be taken to assure confidential treatment of such information, to the extent such protection is available;

7.2.5.made by the receiving Party to its Affiliates or potential future or actual sublicensees (including Sublicensees) or distributors, or by the receiving Party or its Affiliates, sublicensees (including Sublicensees) or distributors to Third Parties, in each case, as may be necessary or useful in connection with the Exploitation of any Licensed Compound or Licensed Product as contemplated by this Agreement, and in the case of Licensor, for disclosure to MedImmune or its Affiliates for use in connection with MedImmune or its Affiliates’ Exploitation of the AstraZeneca Product, including subcontracting or sublicensing transactions in connection therewith; provided, however, that such disclosures are made under obligations of confidentiality and non-use with respect to such Confidential Information substantially similar to the obligations of confidentiality and non-use of the receiving Party pursuant to this Article 7 (with a duration of confidentiality and non-use obligations as appropriate that is no less than five (5) years from the date of disclosure);

7.2.6.made by or on behalf of the receiving Party to consultants of such receiving Party, or other Third Party service providers performing activities on behalf of such receiving Party hereunder or in connection herewith; provided, however, that (a) such disclosure shall be limited to only that Confidential Information required to enable such Third Party to perform the applicable activities and (b) such Third Party shall be subject to obligations of confidentiality and non-use with respect to such Confidential Information substantially similar to the obligations of confidentiality and non-use of the receiving Party pursuant to this Article 7 (with a duration of confidentiality and non-use obligations as appropriate that is no less than five (5) years from the date of disclosure); provided, further, that if either Party seeks to disclose the terms of this Agreement to consultants or Third Party service providers, the Party seeking to disclose this Agreement must obtain the other Party’s prior written consent before disclosing this Agreement (such consent not to be unreasonably withheld, delayed or conditioned);

7.2.7.made by or on behalf of the receiving Party to potential or actual investors, investment bankers, lenders or acquirers as may be necessary in connection with their evaluation of such potential or actual investment, loan, financing or acquisition; provided,

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however, that such persons shall be subject to reasonable obligations of confidentiality and non-use with respect to such Confidential Information substantially similar to the obligations of confidentiality and non-use of the receiving Party pursuant to this Article 7, with a duration of confidentiality and non-use obligations that is no less than five (5) years from the date of disclosure; provided, further, that: (a) upon the written request of either Party, the Parties shall, within thirty (30) days of such request, mutually agree in good faith on a redacted version of this Agreement that may be provided by a Party to a bona fide potential investor, acquirer or divestment partner, such agreement not to be unreasonably withheld, delayed or conditioned, and such redactions not to be so extensive that they do not permit a potential investor, acquirer or divestment partner to gain a reasonable understanding of the relationship established by this Agreement or to conduct reasonable due diligence regarding this Agreement (such redacted version, the “Redacted Agreement”), and such Party shall have the right to provide any such bona fide potential investor, acquirer or divestment partner with the Redacted Agreement or a summary thereof; and (b) if a Party seeks to disclose any terms of this Agreement that were redacted from the Redacted Agreement to potential investors, acquirers or divestment partners, the Party seeking to disclose such terms must obtain the other Party’s prior written consent before disclosing such terms (such consent not to be unreasonably withheld, delayed or conditioned). In no event shall the Party seeking to disclose Confidential Information of the other Party or the terms of this Agreement to a potential investor, acquirer or divestment partner be required to disclose the identity of such potential investor, acquirer or divestment partner to the other Party; or

7.2.8.in the case of Licensor, Licensor may disclose Confidential Information of Licensee to MedImmune in order to comply with Licensor’s obligations under the MedImmune License.

Notwithstanding the foregoing, Licensee shall not, without Licensor’s and MedImmune’s prior written consent, which may be withheld in Licensor’s and MedImmune’s sole discretion, disclose any AstraZeneca Product Know-How (other than AstraZeneca Product Know-How that is or becomes part of the public domain by public use, public general knowledge or the like through no breach of this Agreement by Licensee or any of its Affiliates or its or their Sublicensees) or any other Confidential Information specifically relating to the AstraZeneca Product, any AstraZeneca Product Improvement or AstraZeneca Product Patents, except in each case to the extent provided in Section 7.2.1 or, with respect to actual Sublicensees but not with respect to potential future sublicensees, Section 7.2.5.

7.3.Use of Name. Except as expressly provided herein, neither Party shall mention or otherwise use the name, logo or Trademark of the other Party or any of its Affiliates or any of its or their licensors (including MedImmune and its Affiliate, AstraZeneca), (sub)licensees (or Sublicensees) (or any abbreviation or adaptation thereof) in any publication, press release, marketing and promotional material or other form of publicity in connection with this Agreement or activities hereunder without the prior written approval of such other Party. The restrictions imposed by this Section 7.3 shall not prohibit (a) either Party from making any disclosure

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identifying the other Party to the extent required in connection with its exercise of its rights or obligations under this Agreement and (b) either Party from making any disclosure identifying the other Party that is required by Applicable Law or the rules of a stock exchange on which the securities of the disclosing Party are listed (or to which an application for listing has been submitted).

7.4.Public Announcements.

7.4.1.Subject to this Section 7.4.1, neither Party or any of its Affiliates shall issue any public announcement, press release or other similar formal public disclosure (e.g., a disclosure required to be made in a registration statement, periodic report or similar filing) regarding this Agreement without the other Party’s prior written consent, such consent not to be unreasonably withheld, delayed or conditioned. The Party proposing to make such public announcement, press release or other similar formal public disclosure shall provide a copy of any such public announcement, press release or other similar formal public disclosure to the other Party reasonably (to the extent practicable under the circumstances) but in all cases no less than five (5) Business Days (or, in the case of a disclosure covered by the third sentence of this Section 7.4.1, one (1) Business Day) in advance of issuing or otherwise publicly disclosing such public announcement, press release or other similar formal public disclosure. In the event and to the extent a Party is, in the opinion of its counsel, required by Applicable Law or the rules of a stock exchange on which its securities are listed (or to which an application for listing has been submitted) to make such a public announcement, press release or other similar formal public disclosure, such Party shall submit the proposed public announcement, press release or other similar formal public disclosure in writing to the other Party reasonably (to the extent practicable under the circumstances) but in all cases no less than one (1) Business Day in advance. Under the circumstances covered in the immediately preceding sentence and subject to Section 6.7, the releasing Party shall not be obligated (a) to delay making any such public announcement, press release or other similar formal public disclosure beyond the time when the same is required to be made in order to facilitate review and comment by the other Party or (b) to refrain from issuing such public announcement, press release or other similar formal public disclosure for which approval has not been provided by the other Party. In the event and to the extent a Party is, in the opinion of its counsel, required by Applicable Law or the rules of a stock exchange on which its securities are listed (or to which an application for listing has been submitted) to make any disclosure regarding this Agreement in any required filing, neither Party shall be required to seek the consent of the other Party to repeat such disclosure in a subsequent required filing (but not, for clarity, in any other public announcement or a press release) by a Party in accordance with this Section 7.4.1; provided that (i) such disclosure remains accurate as of such time in light of the then-applicable circumstances and (ii) the frequency and form of such disclosure are reasonable, including in light of the context of such disclosure taking into account the passage of time and other circumstances. Subject to Section 4.3.2, each Party may, without the other Party’s consent, issue public announcements, press releases or other similar formal public disclosures solely regarding (x) clinical trials of Licensed Product in the Territory,

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including the initiation, enrollment status and results thereof, (y) the filing, or acceptance for filing, of INDs and Drug Approval Applications for Licensed Product in the Territory, or (z) the receipt of Regulatory Approvals with respect to Licensed Product in the Territory; provided, however, that such Party shall provide a copy of any such public announcements, press releases or other similar formal public disclosures to the other Party reasonably (to the extent practicable under the circumstances) but in all cases no less than five (5) Business Days (or, in the case of a public disclosure covered by the third sentence of this Section 7.4.1, one (1) Business Day) in advance of issuing such public announcement, press release or other similar formal public disclosure; provided, further, that any such public announcement, press release or other similar formal public disclosure that includes an AstraZeneca Product Reference shall be subject to Licensor’s and MedImmune’s prior written consent, such consent by Licensor not to be unreasonably withheld, conditioned or delayed and Licensor shall use Commercially Reasonable Efforts to seek MedImmune’s consent. In addition, either Party may disclose amounts paid to or received by either Party in respect of the achievement of any milestone events.

7.4.2.Without limitation to Section 7.4.1, which applies to public announcements, press releases and other similar formal public disclosures, and to Section 7.5 which applies to publications in scientific or medical journals, reference publications or scientific or medical presentations, the Parties acknowledge that, in the course of Developing and Commercializing the Licensed Product, Licensee and its Affiliates will need to communicate orally or otherwise informally with various Third Parties (including industry analysts and key opinion leaders) concerning the Licensed Product and that, given the relationship of the Licensed Product to the AstraZeneca Product, such communications may implicate the positioning of the Licensed Product in relation to the AstraZeneca Product. Section 7.4.1 is not intended to cover such oral or other informal communications with Third Parties (other than Regulatory Authorities). Subject to Sections 4.4.6 and 7.5, Licensee shall have the right to engage in such oral or other informal communications with Third Parties, provided that in engaging in such oral or other informal communications with Third Parties, Licensee and its Affiliates shall ensure that such communications regarding the Licensed Product are consistent with the then-applicable Product Positioning Principles approved by Licensor pursuant to Section 4.8.

7.4.3.For clarity, in no event shall Licensor or its upstream licensor, MedImmune, be required to notify Licensee of, or to obtain Licensee’s consent with respect to, any public announcement, press release or other public disclosure regarding the AstraZeneca Product that does not refer to a Licensed Product.

7.4.4.The terms of this Section 7.4 shall be applicable to any Sublicensee of Licensee or any of its Affiliates.

7.5.Publications. The Parties recognize the desirability of publishing the results of Development activities under this Agreement. Accordingly, Licensee shall be permitted to

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publicly disclose in scientific or medical journals, reference publications or scientific or medical presentations the results of Development activities performed by Licensee or Licensor under this Agreement in accordance with this Section 7.5. Prior to making any such publication or disclosure, Licensee shall provideLicensor with drafts of such proposed publication or disclosure, including as applicable proposed abstracts, manuscripts or summaries of presentations. Licensor shall respond promptly through its designated representative and in any event no later than thirty (30) days after receipt of such proposed publication or presentation or such shorter period as may be required by the publication or presentation. Licensee agrees to allow a reasonable additional period to permit filings for patent protection and to otherwise address issues of Confidential Information or related competitive harm to the reasonable satisfaction of Licensor in a manner consistent with Applicable Law and industry practices. In addition, Licenseeshall give due regard to comments furnished by Licensorand such comments shall not be unreasonably rejected; provided, however, that if any such abstract, manuscript or summary of presentations contains any AstraZeneca Product Reference that (a) is not supported by the approved labeling for the AstraZeneca Product or presents an unbalanced view of the AstraZeneca Product considering the approved labeling for the AstraZeneca Product as a whole or (b) contains projections of the market potential of the AstraZeneca Product, Licensee shall correct or remove such AstraZeneca Product Reference or such projections, as applicable. Notwithstanding the foregoing, subject to any copyrights or intellectual property rights of Third Parties, Licensee’s publications may include reprints of scientific or medical journal articles or reference publications regarding the AstraZeneca Product that, in each case, follow FDA’s “Good Reprint Practices for the Distribution of Medical Journal Articles and Medical or Scientific Reference Publications on Unapproved New Uses of Approved Drugs and Approved or Cleared Medical Devices” guidance or an equivalent regulatory guidance in the Territory. The terms of this Section 7.5 shall be applicable to any Sublicensee of Licensee or any of its Affiliates.

7.6.Securities Laws. Licensee acknowledges that Confidential Information disclosed or provided to Licensee by Licensor, including the results of any clinical trial or other study of a Licensed Product, may constitute or contain material non-public information regarding Licensor and that the United States securities laws prohibit any Person who has such material non-public information from purchasing or selling securities of a publicly traded company on the basis of such information and from communicating such information to any Person under circumstances in which it is reasonably foreseeable that such Person is likely to purchase or sell such securities on the basis of such information.

7.7.Return of Confidential Information. Upon the effective date of the expiration or termination of this Agreement for any reason, either Party may request in writing and the non-requesting Party shall either, with respect to Confidential Information to which such non-requesting Party does not retain license rights under the surviving provisions of this Agreement, at the requesting Party’s election, (a) promptly destroy all copies of such Confidential Information in the possession or control of the non-requesting Party and confirm such destruction in writing to the requesting Party or (b) promptly deliver to the requesting Party, at the non-requesting Party’s sole cost and expense, all copies of such Confidential Information in the possession or control of the non-requesting Party. Notwithstanding the foregoing, the non-

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requesting Party shall be permitted to retain such Confidential Information (i) to the extent necessary or useful for purposes of performing any continuing obligations or exercising any ongoing rights hereunder and, in any event, a single copy of such Confidential Information for archival purposes and (ii) any computer records or files containing such Confidential Information that have been created solely by such non-requesting Party’s automatic archiving and back-up procedures, to the extent created and retained in a manner consistent with such non-requesting Party’s standard archiving and back-up procedures, but not for any other uses or purposes. All Confidential Information shall continue to be subject to the terms of this Agreement for the period set forth in Section 7.1.

7.8.Reporting to Wacker Biotech. Licensee shall provide to Licensor on request all information and documents in its possession or control as reasonably required for Licensor to meet its requirements under Section 4.6 of the Wacker License.

ARTICLE 8
REPRESENTATIONS AND WARRANTIES

8.1.Mutual Representations and Warranties. Licensor and Licensee each represents and warrants to the other, as of the Effective Date, and covenants, that:

8.1.1.it is a corporation or limited liability company (as applicable) duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has all requisite power and authority, corporate or otherwise, to execute, deliver and perform this Agreement;

8.1.2.the execution and delivery of this Agreement and the performance by it of the transactions contemplated hereby have been duly authorized by all necessary corporate action and do not violate: (a) such Party’s charter documents, bylaws or other organizational documents; (b) any requirement of any Applicable Law; or (c) any order, writ, judgment, injunction, decree, determination or award of any court or governmental agency presently in effect applicable to such Party;

8.1.3.this Agreement is a legal, valid and binding obligation of such Party enforceable against it in accordance with its terms and conditions, subject to the effects of bankruptcy, insolvency or other laws of general application affecting the enforcement of creditor rights, judicial principles affecting the availability of specific performance and general principles of equity (whether enforceability is considered a proceeding at law or equity);

8.1.4.it is not under any obligation, contractual or otherwise, to any Person that conflicts with or is inconsistent in any material respect with the terms of this Agreement or that would impede the diligent and complete fulfillment of its obligations hereunder; and

8.1.5.neither it nor any of its Affiliates has been debarred or is subject to debarment and neither it nor any of its Affiliates will use in any capacity, in connection

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with the services or activities to be performed under this Agreement, any Person who has been debarred pursuant to Section 306 of the FFDCA or who is the subject of a conviction described in such section. It will inform the other Party in writing promptly if it or any such Person who is performing services or activities hereunder is debarred or is the subject of a conviction described in Section 306 or if any action, suit, claim, investigation or legal or administrative proceeding is pending or, to the best of its or its Affiliates’ knowledge, is threatened, relating to the debarment or conviction of it or any such Person performing services hereunder.

8.2.Additional Representations and Warranties of Licensor. Licensor further represents and warrants to Licensee, as of the Effective Date, that:

8.2.1.Licensor Controls the Licensed Trademarks, the Licensed Know-How and the Licensed Patents as of the Effective Date and has the right to grant the licenses and other rights specified herein and has not granted to any Affiliate or Third Party any license or other right with respect to any Licensed Compound, Licensed Product, Licensed Trademarks, Licensed Patents or Licensed Know-How that conflicts with the licenses and other rights granted to Licensee herein;

8.2.2.Licensor does not require any further consents from any Third Party to enter into this Agreement and to provide all necessary rights to Licensee under the Upstream Agreements and other agreements with any Third Party relating to the Licensed Compound and/or the Licensed Product (including Wacker AG, Wacker Biotech and BioVectra);

8.2.3.to Licensor’s Knowledge, Schedule 1.788 sets forth all Patents Controlled by Licensor or its Affiliates that exist and are pending and claim the composition of matter or any method of use of the Licensed Compound;

8.2.4.except for the Upstream Agreements and licenses granted by a vendor or other service provider to Licensor or any of its Affiliates in the ordinary course of business, there are no agreements in effect as of the Effective Date between Licensor and a Third Party under which rights with respect to the Licensed Patents or Licensed Know-How are being licensed to Licensor;

8.2.5.Licensor has provided Licensee with a redacted copy of the each of the Upstream Agreements. Each of the Upstream Agreements is in full force and effect, and no notice of default or termination has been received or given under either of the Upstream Agreements;

8.2.6.Licensor has obtained the acknowledgment of MedImmune and the consent of SFJ as required for Licensor to grant the rights to Licensee hereunder. Licensor has provided Licensee with a copy of each such documents, and each of such documents is in full force and effect, and no notice of default or termination has been received or given under either of the documents.

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8.2.7.to Licensor’s Knowledge, no reexamination, interference, invalidity, opposition, nullity or similar claim or proceeding is pending or threatened with respect to any Licensed Patent;

8.2.8.Licensor has not received any written claim or demand alleging that the Development or Commercialization of the Licensed Product as contemplated herein infringes any Patent owned by any Third Party;

8.2.9.there are no judgments or settlements against or owed by Licensor (or any of its Affiliates) with respect to the Licensed Patents or Licensed Know-How, and Licensor is not a party to any legal action, suit or proceeding relating to the Licensed Patents or Licensed Know-How, nor has Licensor received any written communication from any Third Party, including any Regulatory Authority or other government agency, threatening such action, suit or proceeding;

8.2.10.to the Knowledge of Licensor, there have been no material Safety/Efficacy Issue relating to the Licensed Compound and/or Licensed Product;

8.2.11.all material data, information and materials, including, but not limited to, Licensed Know-How, provided or disclosed to Licensee by Licensor prior to the Effective Date relating to non-clinical and clinical studies of the Licensed Compound and/or Licensed Product are, to the Knowledge of Licensor, accurate in all material respects, and, to the Knowledge of Licensor, neither Licensor nor any of its Affiliates or (sub)licensees has withheld or concealed from (a) Licensee any Serious Adverse Event and/or Spontaneous Adverse Event relating to the Licensed Compound and/or Licensed Product or (b) any Regulatory Authority in the Territory any material adverse information known to Licensor or any of its Affiliates in relation to the Licensed Compound and/or Licensed Product which might be reasonably expected to affect the decision of the Regulatory Authority to grant Regulatory Approval;

8.2.12.subject to Section 4.2.4, Licensor, its Affiliates, sublicensees and consultants have generated, prepared, maintained and retained in all material aspects all Regulatory Documentation relating to the Licensed Compound and/or Licensed Product that is required to be generated, maintained or retained pursuant to Applicable Law;

8.2.13.to the Knowledge of Licensor, neither Licensor nor its Affiliates, nor any of its or their respective directors, officers, employees or agents has (a) committed an act, (b) made a statement or (c) failed to act or make a statement, in any case ((a), (b) or (c)), that, at the time such statement, action, or omission occurred, (x) was an untrue or fraudulent statement of material fact to the FDA or any other Regulatory Authority with respect to the Development, Manufacture, having Manufactured, use or Commercialization of the Licensed Compound and/or Licensed Product or (y) resulted in the FDA or any other Regulatory Authority invoking its policy respecting “Fraud, Untrue Statements of Material Facts, Bribery and Illegal Gratuities”, set forth in 56 Fed. Reg. 46191 (September 10, 1991) and any amendments thereto or any analogous laws or policies in any other country in the Territory, with respect to Development, Manufacture,

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having Manufactured, use or Commercialization of the Licensed Compound and/or Licensed Product;

8.2.14.to Licensor’s Knowledge: (i) Licensor has not been in material breach or default under the MedImmune License which has not been timely cured as permitted thereunder, and (ii) the MedImmune License is in full force and effect;

8.2.15.to Licensor’s Knowledge: (i) Licensor has not been in material breach or default under the SFJ Agreement which has not been timely cured as permitted thereunder, and (ii) the SFJ Agreement is in full force and effect; and

8.2.16.to Licensor’s Knowledge: (i) Licensor has not been in material breach or default under the Wacker License which has not been timely cured as permitted thereunder, and (ii) the Wacker License is in full force and effect.

8.3.DISCLAIMER OF WARRANTIES. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH HEREIN, NEITHER PARTY MAKES ANY REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE; AND EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

8.4.Anti-Bribery and Anti-Corruption Compliance. Each Party agrees, on behalf of itself, its officers, directors and employees and on behalf of its Affiliates, agents, representatives, consultants and subcontractors hired in connection with the subject matter of this Agreement (“Representatives”) that for the performance of its obligations hereunder:

8.4.1.such Party and its Representatives shall comply with the Anti-Corruption Laws and shall not take any action that will, or would reasonably be expected to, cause the other Party or its Affiliates to be in violation of any Anti-Corruption Laws.

8.4.2.such Party shall promptly provide the other Party with written notice of the following events: (a) upon becoming aware of any breach or violation by such Party or its Representative of any representation, warranty or undertaking set forth in Section 8.4.1, or (b) upon receiving a formal notification that it is the target of a formal investigation by a Governmental Authority for a Material Anti-Corruption Law Violation or upon receipt of information from any of its Representatives connected with this Agreement that any of them is the target of a formal investigation by a Governmental Authority for a Material Anti-Corruption Law Violation.

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ARTICLE 9
INDEMNITY

9.1.Indemnification of Licensor. Licensee shall save, indemnify, defend and hold harmless Licensor, its Affiliates, its or their (sub)licensees of the Licensed Product, MedImmune and its Affiliates, its or their (sub)licensees of AstraZeneca Product rights, and its and their respective directors, officers, employees and agents (collectively, “Licensor Indemnitees”), from and against any and all losses, damages, liabilities, costs and expenses (including reasonable attorneys’ fees and expenses) (collectively, “Losses”) to which any Licensor Indemnitee becomes subject as a result of any and all suits, investigations, claims or demands of Third Parties (collectively, “Third Party Claims”) arising from or occurring as a result of: (a) the breach by Licensee of this Agreement, including any representation, warranty or covenant herein or the enforcement of Licensor’s rights under this Section 9.1; (b) the gross negligence or willful misconduct on the part of any Licensee Indemnitee in performing its or their obligations under this Agreement; or (c) the Development and Commercialization by Licensee or any of its Affiliates or its or their Sublicensees or its or their distributors or contractors of any Licensed Compound or Licensed Product; except, in each case ((a), (b) and (c)), to the extent such Losses arise or result from the gross negligence or willful misconduct of any Licensor Indemnitee or the breach by Licensor of any warranty, representation, covenant or agreement made by Licensor in this Agreement, as to which Losses each Party shall indemnify the other to the extent of their respective liability.

9.2.Indemnification of Licensee. Licensor shall save, indemnify, defend and hold harmless Licensee, its Affiliates, its or their (sub)licensees or its or their distributors or contractors, and its or their respective directors, officers, employees and agents (collectively, “Licensee Indemnitees”), from and against any and all Losses to which any Licensee Indemnitee becomes subject as a result of any and all Third Party Claims arising from or occurring as a result of: (a) the breach by Licensor of this Agreement, including any representation, warranty or covenant herein or the enforcement of Licensee’s rights under this Section 9.2; (b) the Exploitation by Licensor or any of its Affiliates or its or their (sub)licensees (other than Licensee, its Affiliates and Sublicensees) or its or their distributors or contractors of the Licensed Product; except, in each case ((a) and (b)), to the extent such Losses arise or result from the gross negligence or willful misconduct of any Licensee Indemnitee or the breach by Licensee of any warranty, representation, covenant or agreement made by Licensee in this Agreement, as to which Losses each Party shall indemnify the other to the extent of their respective liability for the Losses.

9.3.Indemnification Procedures.

9.3.1.Notice of Claim. All indemnification claims in respect of a Licensor Indemnitee or Licensee Indemnitee shall be made solely by Licensor or Licensee, respectively (the “IndemnifiedParty”). The Indemnified Party shall give the indemnifying Party prompt written notice (an “IndemnificationClaimNotice”) of any Losses or discovery of fact upon which such Indemnified Party intends to base a request for indemnification under this Article 9, but in no event shall the indemnifying Party be

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liable for any Losses to the extent resulting from any delay in providing such notice. Each Indemnification Claim Notice must contain a description of the claim and the nature and amount of such Loss (to the extent that the nature and amount of such Loss is known at such time). The Indemnified Party shall furnish promptly to the indemnifying Party copies of all papers and official documents received in respect of any Losses and Third Party Claims.

9.3.2.Control of Defense. The indemnifying Party shall have the right to assume the defense of any Third Party Claim by giving written notice to the Indemnified Party within thirty (30) days after the indemnifying Party’s receipt of an Indemnification Claim Notice. The assumption of the defense of a Third Party Claim by the indemnifying Party shall not be construed as an acknowledgment that the indemnifying Party is liable to indemnify the Indemnified Party in respect of the Third Party Claim, nor shall it constitute a waiver by the indemnifying Party of any defenses it may assert against the Indemnified Party’s claim for indemnification. Upon assuming the defense of a Third Party Claim, the indemnifying Party may appoint as lead counsel in the defense of the Third Party Claim any legal counsel selected by the indemnifying Party. In the event the indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall immediately deliver to the indemnifying Party all original notices and documents (including court papers) received by the Indemnified Party in connection with the Third Party Claim. Should the indemnifying Party assume the defense of a Third Party Claim, except as provided in Section 9.3.3, the indemnifying Party shall not be liable to the Indemnified Party for any legal expenses subsequently incurred by such Indemnified Party in connection with the analysis, defense or settlement of the Third Party Claim unless specifically agreed in writing by the indemnifying Party.

9.3.3.Right to Participate in Defense. Any Indemnified Party shall be entitled to participate in the defense of such Third Party Claim and to employ counsel of its choice for such purpose; provided,however, that such employment shall be at the Indemnified Party’s sole cost and expense unless (a) the employment of such counsel has been specifically authorized in writing by the indemnifying Party in writing (in which case, the defense shall be controlled as provided in Section 9.3.2), (b) the indemnifying Party has failed to assume the defense and employ counsel in accordance with Section 9.3.2 (in which case the Indemnified Party shall control the defense), or (c) the interests of the indemnitee and the indemnifying Party with respect to such Third Party Claim are sufficiently adverse to prohibit the representation by the same counsel of both Parties under Applicable Law, ethical rules or equitable principles (in which case, the Indemnified Party shall control its defense).

9.3.4.Settlement. With respect to any Losses relating solely to the payment of money damages in connection with a Third Party Claim and that shall not result in the applicable indemnitee(s) becoming subject to injunctive or other relief or otherwise adversely affecting the business of the Indemnified Party in any manner, the indemnifying Party shall have the sole right to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss, on such terms as the indemnifying

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Party, in its sole discretion, shall deem appropriate. With respect to all other Losses in connection with Third Party Claims, where the indemnifying Party has assumed the defense of the Third Party Claim in accordance with Section 9.3.2, the indemnifying Party shall have authority to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss; provided it obtains the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld, conditioned or delayed). If the indemnifying Party does not assume and conduct the defense of a Third Party Claim as provided above, the Indemnified Party may defend against such Third Party Claim; provided that the Indemnified Party shall not settle any Third Party Claim without the prior written consent of the indemnifying Party (which consent shall not be unreasonably withheld, conditioned or delayed).

9.3.5.Cooperation. Regardless of whether the indemnifying Party chooses to defend any Third Party Claim, the Indemnified Party shall and shall cause each indemnitee to, cooperate in the defense thereof and shall furnish such records, information and testimony, provide such witnesses and attend such conferences, discovery proceedings, hearings, trials and appeals as may be reasonably requested in connection therewith. Such cooperation shall include access during normal business hours afforded to the indemnifying Party to and reasonable retention by the Indemnified Party of, records and information that are reasonably relevant to such Third Party Claim and making Indemnified Parties and other employees and agents available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder and the indemnifying Party shall reimburse the Indemnified Party for all its, its Affiliates’ and its and their (sub)licensees’ or their respective directors’, officers’, employees’ and agents’, as applicable, reasonable and verifiable out-of-pocket expenses in connection therewith.

9.3.6.Expenses. Except as provided above, the costs and expenses, including fees and disbursements of counsel, incurred by the Indemnified Party and its Affiliates and its and their (sub)licensees and their respective directors, officers, employees and agents, as applicable, in connection with any claim shall be reimbursed on a Calendar Quarter basis by the indemnifying Party, without prejudice to the indemnifying Party’s right to contest the Indemnified Party’s right to indemnification and subject to refund in the event the indemnifying Party is ultimately held not to be obligated to indemnify the Indemnified Party.

9.4.SPECIAL, INDIRECT AND OTHER LOSSES. EXCEPT IN THE EVENT OF (a) THE WILLFUL MISCONDUCT OR FRAUD OF A PARTY OR (b) OF A PARTY’S BREACH OF ITS OBLIGATIONS UNDER ARTICLE 7 OR SECTION 2.5, NEITHER PARTY SHALL BE ENTITLED TO RECOVER FROM THE OTHER PARTY ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OR LOST PROFITS IN CONNECTION WITH THIS AGREEMENT OR ANY LICENSE GRANTED HEREUNDER; provided, however, that this Section 9.4 shall not be construed to limit either Party’s indemnification obligations under Section 9.1 or 9.2 (as applicable) and Section 9.3.

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9.5.Insurance. Licensee shall have and maintain such types and amounts of insurancecovering its Development and Commercialization of the Licensed Compounds and Licensed Product (and the Manufacturing of the Licensed Compounds and Licensed Product in the event that Licensee undertakes the Manufacture of the Licensed Compounds and Licensed Product in accordance with the terms of the Supply Agreement) as is (a) normal and customary in the biopharmaceutical industry generally for parties similarly situated and (b) otherwise required by Applicable Law. Upon request by Licensor, Licensee shall provide to Licensor evidence of its insurance coverage, including copies of applicable insurance policies. The insurance policies shall be under an occurrence form, but if only a claims-made form is available to Licensee, then Licensee shall continue to maintain such insurance after the expiration or termination of this Agreement in its entirety for a period of five (5) years.

ARTICLE 10
TERM AND TERMINATION

10.1.Term and Expiration. This Agreement shall commence on the Effective Date and, unless earlier terminated in accordance herewith, shall continue in force and effect until the date of expiration of the last to expire Royalty Term in the Territory (such period, the “Term”). On a Licensed Product-by-Licensed Product and country-by-country basis, following the expiration of the Royalty Term for a Licensed Product in a country in the Territory, the grants in Section 2.1 and Section 2.7 for such Licensed Product in such country shall become non-exclusive, fully-paid, royalty-free, irrevocable and perpetual. Following the expiration of the last-to-expire Royalty Term for any and all Licensed Product in the Territory, the grants in Section 2.1 and Section 2.7 shall become non-exclusive, fully-paid, royalty-free, irrevocable and perpetual in their entirety.

10.2.Termination.

10.2.1.Material Breach.

(a)Material Breach Not Related to Diligence. In the event that either Party (the “Breaching Party”) shall be in material breach in the performance of any of its obligations under this Agreement (other than, in the case of Licensor, Licensor’s diligence obligations under Section 4.2.1, and in the case of Licensee, Licensee’s diligence obligations under Section 4.4.1, which are covered in Section 10.2.1(b) below), in addition to any other right and remedy the other Party (the “Non-Breaching Party”) may have, the Non-Breaching Party may terminate this Agreement in its entirety (or, if Licensor is the Non-Breaching Party, on a country-by-country basis) by providing ninety (90) days’ (or thirty (30) days’, in the case of a payment default) (the “Section 10.2.1(a) Notice Period”) prior written notice (the “Section 10.2.1(a) Termination Notice”) to the Breaching Party specifying the breach and its claim of right to terminate, subject to Section 10.2.1(c) below; provided that the termination shall not become effective at the end of the Section 10.2.1(a) Notice Period if the Breaching Party cures the breach specified in the Section 10.2.1(a) Termination Notice during the Section 10.2.1(a) Notice Period.

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(b)Material Breach of Diligence Obligations. If at any time Licensee in good faith believes that Licensor is in material breach of its diligence obligations under Section 4.2.1, then Licensee shall so notify Licensor, specifying the basis for its belief, and the Parties shall meet within thirty (30) days after such notice to discuss in good faith Licensee’s concerns. If at any time Licensor in good faith believes that Licensee is in material breach of its diligence obligations under Section 4.4.1, then Licensor shall so notify Licensee, specifying the basis for its belief, and the Parties shall meet within thirty (30) days after such notice to discuss in good faith Licensor’s concerns. If, after such thirty (30) day period, the Parties agree that a Party is in breach of such obligations or if the Parties do not reach agreement as to whether or not a Party is in material breach of such obligations and resolve the issue, then in addition to any other right and remedy a Party may have, but subject to Section 10.2.1(c) below, the Non-Breaching Party may terminate this Agreement by providing ninety (90) days’ (the “Section 10.2.1(b) Notice Period”) prior written notice (the “Section 10.2.1(b) Termination Notice”) to the Breaching Party specifying the breach and its claim of right to terminate; provided that (i) the termination shall not become effective at the end of the Section 10.2.1(b) Notice Period if, in the case of a curable breach, the Breaching Party cures the breach specified in the Section 10.2.1(b) Termination Notice during the Section 10.2.1(b) Notice Period, and (ii) with respect to any uncurable breach or an uncured material breach of such diligence obligations (A) with respect to the EU Market, the Non-Breaching Party shall have the right to terminate the Agreement in its entirety or solely with respect to the EU Market or, (B) with respect to any other country that is not in the EU Market, the Non-Breaching Party shall have the right to terminate this Agreement solely with respect to such country.

(c)Dispute Regarding Breach. Notwithstanding the foregoing provisions of this Section 10.2.1, in the event that, during the applicable Notice Period, the allegedly Breaching Party shall have initiated dispute resolution in accordance with Section 11.6 with respect to the alleged breach, then the other Party shall not have the right to terminate this Agreement under this Section 10.2.1 unless and until (i) the Arbitrators, in accordance with Section 11.6, have determined that the Breaching Party has materially breached this Agreement and (ii) the Breaching Party fails to cure such breach within ninety (90) days (or thirty (30) days, in the case of a payment default) following the Arbitrators’ decision. It is understood and agreed that during the pendency of such dispute, all of the terms and conditions of this Agreement shall remain in effect, and the Parties shall continue to perform all of their respective obligations hereunder.

(d)Termination for Insolvency. In the event that either Party (a) files for protection under bankruptcy or insolvency laws, (b) makes an assignment for the benefit of creditors, (c) appoints or suffers appointment of a receiver or trustee over substantially all of its property that is not discharged

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within ninety (90) days after such filing, (d) proposes a written agreement of composition or extension of its debts generally, (e) is a party to any dissolution or liquidation, (f) files a petition under any bankruptcy or insolvency act or has any such petition filed against it that is not discharged within ninety (90) days of the filing thereof, (g) admits in writing its inability generally to meet its obligations as they fall due in the general course, or (h) initiates actions to wind up or liquidate its business voluntarily or otherwise, then the other Party may terminate this Agreement in its entirety effective immediately upon written notice to such Party.

10.2.2.Termination by Licensor. In the event that Licensee or any of its Affiliates or Sublicensees, anywhere in the Territory, institutes, prosecutes or otherwise participates in (or in any way aids any Third Party in instituting, prosecuting or participating in), at law or in equity or before any administrative or regulatory body, including the U.S. Patent and Trademark Office or its foreign counterparts, any claim, demand, action, or cause of action for declaratory relief, damages, or any other remedy or for an enjoinment, injunction, or any other equitable remedy, including any interference, re-examination, opposition or any similar proceeding, alleging that any claim in a Licensed Patent is invalid, unenforceable, or otherwise not patentable or alleging that any such claim would not be infringed by Licensee’s activities in the absence of the rights and licenses granted hereunder, then Licensor shall have the right to immediately terminate this Agreement in its entirety, including the rights of any Sublicensees, upon written notice to Licensee; provided, however, that if any such proceeding is brought by a Sublicensee, Licensee shall have a period of sixty (60) days to cause such Sublicensee to cease such proceeding or terminate the applicable sublicense agreement, in which case Licensor shall not have the right to terminate this Agreement pursuant to this Section 10.2.2 by reason of the proceeding brought by such Sublicensee.

10.2.3.Termination by Licensee for Safety/Efficacy Issue or Commercial Viability Issue.

(a)Notice of Claimed Safety/Efficacy Issue or Commercial Viability Issue. In the event that Licensee believes in good faith that (i) a Safety/Efficacy Issue with respect to the Licensed Compound and/or any Licensed Product exists or (ii) a Commercial Viability Issue exists, Licensee shall provide written notice thereof to Licensor, which notice shall include reasonable details (in the case of Commercial Viability Issue, as further set forth in Section 10.2.3(b)) regarding, as applicable, the claimed Safety/Efficacy Issue and shall indicate whether the same is claimed to be a Global Safety/Efficacy Issue or a Market-Specific Safety/Efficacy Issue, or the claimed Commercial Viability Issue and shall indicate (x) in the case of a Safety/Efficacy Issue, whether the EU Market or other country or countries in the Territory are affected thereby; and (y) in the case of a Commercial Viability Issue, whether, based on Licensee’s assessment of such claimed Commercial Viability Issue with respect to the EU Market, such claimed Commercial Viability Issue is a Global Commercial Viability Issue. Within thirty (30) days of delivery of any such notice, the Parties

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shall discuss the applicable claimed Safety/Efficacy Issue or Commercial Viability Issue and attempt in good faith to reach mutual agreement (such agreement not to be unreasonably withheld, conditioned or delayed) as to, as applicable:

(i)whether or not it in fact constitutes a Safety/Efficacy Issue or Commercial Viability Issue;

(ii)in the case of a Safety/Efficacy Issue, whether the same is a Global Safety/Efficacy Issue or a Market-Specific Safety/Efficacy Issue;

(iii)solely in the case of a Market-Specific Safety/Efficacy Issue, whether or not such Safety/Efficacy Issue is reasonably curable within six (6) months of Licensee’s notice with the use of Commercially Reasonable Efforts to cure (and, if it is agreed to be so curable, the Parties shall attempt in good faith to mutually agree upon a curative plan); and

(iv)in the case of a claimed Commercial Viability Issue, whether such Commercial Viability Issue applies to the EU Market or is a Global Commercial Viability Issue,

(in each case ((i) through (iv)), a “Section 10.2.3 Matter”).

If the Parties are unable to reach mutual agreement within a further thirty (30) days, then, upon the written request of either Party, the matter shall be subject to resolution in accordance with Section 10.2.3(c).

(b)In the case of any claimed Commercial Viability Issue, Licensee shall provide at a minimum the following data and other information in support of such Commercial Viability Issue with respect to each applicable Market (including, with respect to the EU Market): [***].

(c)Expedited Resolution by Independent Expert. If the Parties are unable to reach mutual agreement within the period specified in the last sentence of Section 10.2.3(a), then, upon the written request of either Party, the applicable Section 10.2.3 Matter(s) may be referred by either Party to Licensor’s Chief Financial Officer or VP of Marketing/Chief Commercial Officer (or their respective designees) and Licensee’s Chief Financial Officer or VP of Marketing/Chief Commercial Officer (or their respective designees)for attempted resolution by good faith negotiations during a period of ten (10) Business Days. Any final decision mutually agreed to by such senior representatives (or such designees) shall be conclusive and binding on the Parties. If such senior representatives (or such designees) are unable to resolve any such Section 10.2.3 Matter within such ten (10)-Business Day period, then either Party shall have the right to refer such Section 10.2.3 Matter to the Senior Officers for attempted resolution by good faith negotiations during a period of ten (10) Business Days. Any final decision

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mutually agreed to by the Senior Officers shall be set forth in writing and signed by both Parties, whereupon it will be conclusive and binding on the Parties. If such Senior Officers (or such designees) are unable to resolve any such disagreement within such ten (10)-Business Day period, then, upon the written request of either Party, the determination of the Section 10.2.3 Matter shall be referred to an Independent Expert. “Independent Expert” means (i) an independent Third Party expert in the field of drug development and commercialization who is acceptable to both Parties or (ii) if the Parties fail to agree on an independent Third Party expert in accordance with the preceding clause (i) within thirty (30) days after such request for referral, an independent Third Party expert in the field of drug development and commercialization who is selected by mutual agreement of (A) an independent Third Party expert in the field of drug development and commercialization selected by Licensor within thirty-five (35) days after such request for referral and (B) an independent Third Party expert in the field of drug development and commercialization selected by Licensee within thirty-five (35) days after such request for referral (such selection to be made within five (5) days after the Parties have selected their respective independent Third Party experts). The sole authority of the Independent Expert will be to (x) set a schedule for expedited dispute resolution, (y) request supporting documentation from each Party with respect to the applicable Section 10.2.3 Matters and (z) make a determination as to each of the applicable Section 10.2.3 Matters based on such supporting documentation. Unless otherwise agreed by the Parties, the Independent Expert’s determination shall be final and binding upon the Parties. Unless otherwise agreed by the Parties, the Independent Expert shall be required to make his or her determination within ninety (90) days after his or her selection as the Independent Expert.

(d)Termination Rights.

(i)Market-Specific Safety/Efficacy Issue.

(A)    Reasonably Curable. If the Parties mutually agree (including by agreement of their senior representatives or Senior Officers as provided in Section 10.2.3(c)), or the Independent Expert determines, that (1) a claimed Market-Specific Safety/Efficacy Issue is in fact a Market-Specific Safety/Efficacy Issue and (2) such Market-Specific Safety/Efficacy Issue is reasonably curable within six (6) months of Licensee’s notice with the use of Commercially Reasonable Efforts to cure, then within thirty (30) days of such mutual agreement or Independent Expert determination (as applicable), the Parties shall mutually agree in good faith upon a commercially reasonable written curative plan and Licensee shall use Commercially Reasonable Efforts to carry out such curative plan within six (6) months thereafter, or, failing such mutual agreement on a curative plan within thirty (30) days of

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such mutual agreement or Independent Expert determination (as applicable), Licensee shall use Commercially Reasonable Efforts to cure such Safety/Efficacy Issue within six (6) months thereafter. If, despite Licensee’s use of Commercially Reasonable Efforts, such Market-Specific Safety/Efficacy Issue is not cured within such six (6)-month period, then Licensee shall have the right to terminate this Agreement in the country of the Territory where such Market-Specific Safety/Efficacy Issue exists upon thirty (30) days’ written notice to Licensor.

(B)    Not Reasonably Curable. If the Parties mutually agree (including by agreement of their senior representatives or Senior Officers as provided in Section 10.2.3(c)), or the Independent Expert determines, that (1) a claimed Market-Specific Safety/Efficacy Issue is in fact a Market-Specific Safety/Efficacy Issue and (2) such Market-Specific Safety/Efficacy Issue is not reasonably curable within six (6) months of Licensee’s notice with the use of Commercially Reasonable Efforts to cure, then Licensee shall have the right to terminate this Agreement in the country of the Territory where such Market-Specific Safety/Efficacy Issue exists upon thirty (30) days’ written notice to Licensor.

(ii)Global Safety/Efficacy Issue. If the Parties mutually agree (including by agreement of their senior representatives or Senior Officers as provided in Section 10.2.3(c)), or the Independent Expert determines, that a claimed Global Safety/Efficacy Issue is in fact a Global Safety/Efficacy Issue, then Licensee shall have the right to terminate this Agreement in its entirety upon thirty (30) days’ written notice to Licensor.

(iii)EU Market-Specific Commercial Viability Issue. If the Parties mutually agree (including by agreement of their senior representatives or Senior Officers as provided in Section 10.2.3(c)), or the Independent Expert determines, that a claimed Commercial Viability Issue with respect to the EU Market is in fact a Commercial Viability Issue with respect to the EU Market, then Licensee shall have the right to terminate this Agreement with respect to the EU Market only (but not this Agreement in its entirety) upon thirty (30) days’ written notice to Licensor.

(iv)Global Commercial Viability Issue. If the Parties mutually agree (including by agreement of their senior representatives or Senior Officers as provided in Section 10.2.3(c)), or the Independent Expert determines, that any Commercial Viability Issue(s) constitutes a Global Commercial Viability Issue, then Licensee shall have the right to

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terminate this Agreement in its entirety upon thirty (30) days’ written notice to Licensor.

10.2.4.Termination by Licensee for Withdrawal of AstraZeneca Product. In the event that the AstraZeneca Product is withdrawn by a Regulatory Authority in the EU Market, then Licensee shall have the right to terminate this Agreement in its entirety. Except as provided in the immediately foregoing sentence with respect to withdrawal in the EU Market, unless the Parties otherwise agree in writing, in the event that the AstraZeneca Product is withdrawn by a Regulatory Authority in a country other than the EU Market, such withdrawal shall not permit Licensee to terminate this Agreement in whole or in part; provided, however, that in such event Licensee shall be relieved of further diligence obligations under Section 4.1, with respect to such country. For purposes of this Section, references to AstraZeneca Product exclude Generic Ticagrelor Products.

10.2.5.Termination by Mutual Agreement. The Parties may terminate this Agreement by mutual, written consent.

10.3.Rights in Bankruptcy. All rights and licenses granted under or pursuant to this Agreement by Licensee or Licensor including, without limitation, with respect to the Licensed Know-How and Licensed Patents are and shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code or any analogous provisions in any other country or jurisdiction, licenses of right to “intellectual property” as defined under Section 101 of the U.S. Bankruptcy Code. The Parties agree that the Parties, as licensees of such rights under this Agreement, shall retain and may fully exercise all of their rights and elections under the U.S. Bankruptcy Code or any analogous provisions in any other country or jurisdiction. The Parties further agree that, in the event of the commencement of a bankruptcy proceeding by or against either Party under the U.S. Bankruptcy Code or any analogous provisions in any other country or jurisdiction, the Party that is not a Party to such proceeding shall be entitled to a complete duplicate of (or complete access to, as appropriate) any such intellectual property and all embodiments of such intellectual property, which, if not already in the non-subject Party’s possession, shall be promptly delivered to it (a) upon any such commencement of a bankruptcy proceeding upon the non-subject Party’s written request therefor, unless the Party subject to such proceeding elects to continue to perform all of its obligations under this Agreement or, (b) if not delivered under clause (a) above, following the rejection of this Agreement by or on behalf of the Party subject to such proceeding upon written request therefor by the non-subject Party. Each Party agrees that if it is or could be affected by an economic or financial crisis, it shall promptly inform the other Party of the possibility of the commencement of a bankruptcy procedure. Following receipt of such notice, the Party receiving the notice shall be entitled to exercise the rights granted to it by the provisions of this Section 10.3.

10.4.Consequences of Termination.

10.4.1.Effect of Termination on Fully-Paid Licenses. If the Royalty Term with respect to a Licensed Product in any country has expired on or before any termination of this Agreement prior to its expiration, the grants in Section 2.1 and Section 2.7 for such

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Licensed Product in such country shall survive such termination of this Agreement on a non-exclusive, fully-paid, royalty-free, irrevocable and perpetual basis; provided that such grants shall not survive in the event this Agreement is terminated pursuant to Section 10.2.3.

10.4.2.Effect of Termination in its Entirety. In the event of termination of this Agreement in its entirety: (i) by Licensor due to breach of Licensee pursuant to Section 10.2.1 (Material Breach) or due to Licensee’s bankruptcy pursuant to Section 10.3(Rights in Bankruptcy) or (ii) by Licensee pursuant to Section 10.2.3(d)(i) (Market Specific Safety/Efficacy Issue), where this Agreement is terminated in its entirety, Section 10.2.3(d)(ii) (Global Safety/Efficacy Issue), Section 10.2.3(d)(iv) (Global Commercial Viability Issue) and Section 10.2.4 (Termination by Licensee for Withdrawal of AstraZeneca Product); or (iii) by mutual agreement of the Parties pursuant to Section 10.2.5 and subject to Section 10.4.2(h):

(a)subject to Section 10.4.1 and Section 10.4.4, all rights and licenses granted by Licensor hereunder and any sublicense granted by Licensee pursuant to Section 2.3 shall immediately terminate;

(b)Licensee shall and hereby does, and shall cause its Affiliates and its and their Sublicensees to, effective as of the effective date of termination, assign to Licensor all of its right, title and interest in and to (i) each Licensed Trademark, and (ii) all Regulatory Documentation (including any Regulatory Approvals and Licensee Regulatory Documentation) applicable to any Licensed Compound or Licensed Product then owned or Controlled by Licensee or any of its Affiliates or any of its or their Sublicensees; provided that if any such Regulatory Documentation is not immediately transferable in a country, Licensee shall provide Licensor with all benefit of such Regulatory Documentation and such assistance and cooperation as necessary or reasonably requested by Licensor to timely transfer such Regulatory Documentation to Licensor or its designee or, at Licensor’s option, to enable Licensor to obtain a substitute for such Regulatory Documentation without disruption to Licensor’s Exploitation or Manufacture of the applicable Licensed Compound(s) or Licensed Product(s);

(c)all Confidential Information of Licensee to the extent relating specifically to any Licensed Compound or Licensed Product or the Exploitation thereof shall thereafter be deemed Confidential Information of Licensor;

(d)Licensee shall and hereby does, and shall cause its Affiliates and its and their Sublicensees to, effective as of the effective date of termination, grant Licensor an exclusive, perpetual, fully paid up, right of reference, with the right to grant multiple tiers of further rights of reference, in and to all Regulatory Documentation (including any Regulatory Approvals) then owned or Controlled by Licensee or any of its Affiliates or its or their Sublicensees that are not assigned to Licensor pursuant to clause (b) above to Exploit and Manufacture in the Territory any Licensed Compound or Licensed Product;

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(e)Licensee shall provide to Licensor a list of all clinical studies ongoing with respect to any Licensed Compound or Licensed Product and, unless expressly prohibited by any Regulatory Authority, at Licensor’s written request and election in Licensor’s sole discretion, Licensee shall and hereby does, and shall cause its Affiliates and its and their Sublicensees to either: (i) wind down in accordance with Applicable Law and observing applicable ethical and regulatory guidelines any or all clinical studies involving Licensed Product being conducted by or on behalf of Licensee, an Affiliate or a Sublicensee as of the effective date of termination, at Licensee’s cost and expense; or (ii) (x) transfer control to Licensor of any or all clinical studies involving Licensed Product being conducted by or on behalf of Licensee, an Affiliate or a Sublicensee as of the effective date of termination and (y) continue to conduct such clinical studies involving Licensed Product being conducted by or on behalf of Licensee, an Affiliate or a Sublicensee as of the effective date of termination for up to six (6) months to enable such transfer to be completed without interruption of any such clinical study, in each case ((x) and (y)), at Licensor’s cost and expense; provided that Licensor shall not have any obligation to continue any clinical study for which it has elected to have control transferred to Licensor unless required by Applicable Law;

(f)following good faith discussions by the Parties as to which Licensed Product Agreements should be assigned to Licensor, at Licensor’s written request, Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, assign to Licensor or its designee any and all Licensed Product Agreements, unless, with respect to any such Licensed Product Agreement, such Licensed Product Agreement (i) expressly prohibits such assignment (in which case, Licensee, or its Affiliate or Sublicensee, as applicable, shall cooperate with Licensor in all reasonable respects to secure the consent of the applicable Third Party to such assignment), or (ii) relates both to Licensed Product and products other than Licensed Product (in which case, at Licensor’s request, Licensee, or its Affiliate or Sublicensee, as applicable, shall cooperate with Licensor in all reasonable respects to secure the written agreement of the applicable Third Party to a partial assignment of the applicable Licensed Product Agreement relating to the Licensed Product) and, in either case ((i) or (ii)) if any such consent or agreement, as applicable, cannot be obtained with respect to a Licensed Product Agreement, in the case of termination of this Agreement for any reason other than by Licensee pursuant to Section 10.2.1, at Licensor’s request in order to continue to Exploit Licensed Product following termination, Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, obtain for Licensor substantially all of the practical benefit and burden under such Licensed Product Agreement to the extent applicable to the Licensed Product, including by entering into appropriate and reasonable alternative arrangements on terms agreeable to Licensor and subject to the consent and control of Licensor; provided that Licensee’s obligations shall continue only for so long as is reasonably necessary for Licensor

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to secure alternative arrangements directly with one or more Third Parties through the exercise of commercially reasonable efforts;

(g)at Licensor’s option any orders for the Licensor to supply the Licensed Compounds and Licensed Product then being Manufactured by Licensor or its supplier for Licensee pursuant to the Supply Agreement shall be cancelled in all or in part at the discretion of Licensor; and

(h)the exclusivity commitment of Licensor under Section 2.6 shall immediately terminate and the exclusivity commitment of Licensee under Section 2.5 shall immediately terminate except that, in the case of termination by Licensee pursuant to Section 10.2.3(d)(iv) for a Commercial Viability Issue only, such exclusivity commitment of Licensee shall survive for a period which is the earlier of the expiration of the Exclusive Period or [***] following the effective date of such termination, unless Licensor informs Licensee in writing that Licensor elects not to pursue further Development or Commercialization of any Licensed Compound or Licensed Product.

10.4.3.Effect of Termination in a Terminated Territory. In the event of a termination of this Agreement with respect to a Terminated Territory by Licensor due to breach of Licensee or by Licensee pursuant to Section 10.2.3(d)(i), Section 10.2.3(d)(ii) and Section 10.2.4 (but not in the case of any termination of this Agreement in its entirety):

(a)subject to Section 10.4.1 and Section 10.4.4, all rights and licenses granted by Licensor hereunder, and any sublicense granted by Licensee pursuant to Section 2.3, (i) shall automatically be deemed to be amended to exclude, if applicable, the right to (A) market, promote, detail, distribute, import, sell for commercial use, offer for commercial sale or otherwise Commercialize, file any Drug Approval Application for, or seek or maintain any Regulatory Approval for Licensed Product in such Terminated Territory, and (B) Develop any Licensed Compound or Licensed Product anywhere in the world for the purposes of obtaining or maintaining Regulatory Approval in such Terminated Territory, and (ii) shall otherwise survive and continue in effect in such Terminated Territory solely for the purpose of furthering any Commercialization of the Licensed Product in the Territory or any Development or Manufacturing in support thereof;

(b)Licensee shall and hereby does, and shall cause its Affiliates and its and their Sublicensees to, effective as of the effective date of termination, assign to Licensor all of its right, title and interest in and to (i) each Licensed Trademark, if applicable, and (ii) all Regulatory Documentation (including any Regulatory Approvals and Licensee Regulatory Documentation) applicable to any Licensed Compound or Licensed Product solely in the Terminated Territory then owned or Controlled by Licensee or any of its Affiliates or any of its or their Sublicensees; provided that if any such Regulatory Documentation is not immediately transferable in a country, Licensee shall provide Licensor with all

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benefit of such Regulatory Documentation and such assistance and cooperation as necessary or reasonably requested by Licensor to timely transfer such Regulatory Documentation to Licensor or its designee or, at Licensor’s option, to enable Licensor to obtain a substitute for such Regulatory Documentation without disruption to Licensor’s Exploitation or Manufacture of the applicable Licensed Compound(s) or Licensed Product(s);

(c)all Confidential Information of Licensee to the extent relating specifically to any Licensed Compound or Licensed Product or the Exploitation thereof solely with respect to the Terminated Territory shall thereafter be deemed Confidential Information of Licensor;

(d)Licensee shall and hereby does, and shall cause its Affiliates and its and their Sublicensees to, effective as of the effective date of termination, grant Licensor (i) an exclusive, perpetual fully paid up, right of reference, with the right to grant multiple tiers of further rights of reference, in and to all Regulatory Documentation (including any Regulatory Approvals) in the Terminated Territory then owned or Controlled by Licensee or any of its Affiliates or its or their Sublicensees that are not assigned to Licensor pursuant to clause (b) above to Exploit and Manufacture in the Terminated Territory any Licensed Compound or Licensed Product and (ii) a non-exclusive, perpetual, fully paid up, right of reference, with the right to grant multiple tiers of further rights of reference, in and to all Regulatory Documentation (including any Regulatory Approvals) outside of the Terminated Territory then owned or Controlled by Licensee or any of its Affiliates or its or their Sublicensees, solely as necessary to Exploit and Manufacture in the Terminated Territory any Licensed Compound or Licensed Product;

(e)unless expressly prohibited by any Regulatory Authority, at Licensor’s written request and election in Licensor’s sole discretion, Licensee shall and hereby does, and shall cause its Affiliates and its and their Sublicensees to either: (i) wind down in accordance with Applicable Law and observing applicable ethical and regulatory guidelines any or all clinical studies involving Licensed Product being conducted by or on behalf of Licensee, an Affiliate or a Sublicensee as of the effective date of termination exclusively in and for the Terminated Territory (excluding any clinical study intended to generate data that will be submitted to Regulatory Authorities in the Territory), at Licensee’s cost and expense, or (ii) (x) transfer control to Licensor of any or all clinical studies involving Licensed Product being conducted by or on behalf of Licensee, an Affiliate or a Sublicensee as of the effective date of termination exclusively in or for the Terminated Territory (excluding any clinical study intended to generate data that will be submitted to Regulatory Authorities in the Territory) and (y) continue to conduct such clinical studies involving Licensed Product being conducted by or on behalf of Licensee, an Affiliate or a Sublicensee as of the effective date of termination exclusively in or for the Terminated Territoryfor up

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to six (6) months to enable such transfer to be completed without interruption of any such clinical study, in each case ((x) and (y)), at Licensor’s cost and expense; provided that Licensor shall not have any obligation to continue any clinical study for which it has elected to have control transferred to Licensor unless required by Applicable Law; and

(f)following good faith discussions by the Parties as to which Licensed Product Agreements should be assigned to Licensor, at Licensor’s written request, Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, assign to Licensor or its designee any and all Licensed Product Agreements relating solely to the Terminated Territory with respect to which the Parties agree should be assigned to Licensor, unless, with respect to any such Licensed Product Agreement, such Licensed Product Agreement (i) expressly prohibits such assignment (in which case, Licensee, or its Affiliate or Sublicensee, as applicable, shall cooperate with Licensor in all reasonable respects to secure the consent of the applicable Third Party to such assignment), or (ii) relates both to (A) the Terminated Territory and the Territory or (B) Licensed Product and products other than Licensed Product (which, in either case ((A) or (B)), at Licensor’s request, Licensee, or its Affiliate or Sublicensee, as applicable, shall cooperate with Licensor in all reasonable respects to secure the written agreement of the applicable Third Party to a partial assignment of the applicable Licensed Product Agreement relating to the Terminated Territory or Licensed Product, as applicable) and, in either case ((i) or (ii)) if any such consent or agreement, as applicable, cannot be obtained with respect to a Licensed Product Agreement, in the case of termination of this Agreement for any reason other than by Licensee pursuant to Section 10.2.1, at Licensor’s request in order to continue to Exploit Licensed Product in the Terminated Territory following termination, Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, obtain for Licensor substantially all of the practical benefit and burden under such Licensed Product Agreement to the extent applicable to the Licensed Product in the Terminated Territory, including by entering into appropriate and reasonable alternative arrangements on terms agreeable to Licensor and subject to the consent and control of Licensor; provided that Licensee’s obligations shall continue only for so long as is reasonably necessary for Licensor to secure alternative arrangements directly with one or more Third Parties through the exercise of commercially reasonable efforts;

(g)At Licensor’s option any orders for the Licensor to supply the Licensed Compounds and Licensed Product then being manufactured by Licensor or its supplier for Licensee pursuant to the Supply Agreement shall be cancelled in all or in part at the discretion of Licensor; and

(h)the exclusivity commitment of Licensor under Section 2.6 shall immediately terminate with respect to the Terminated Territory, and the exclusivity commitment of Licensee under Section 2.5 shall survive with respect

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to the Territory and shall continue with respect to the Terminated Territory for the Exclusive Period.

10.4.4.Effect of Termination on Sublicensees. In the event of (a) termination of this Agreement in its entirety (except in case of expiration of this Agreement pursuant to Section 10.1, in which case this Section 10.4.4 shall not apply), any and all sublicenses granted by Licensee pursuant to Section 2.3, and (b) termination of this Agreement with respect to any Terminated Territory (but not in its entirety), any and all sublicenses granted by Licensee with respect to the applicable Terminated Territory, in each case ((a) and (b)) shall terminate.

10.5.Remedies. Except as otherwise expressly provided herein, termination of this Agreement (either in its entirety or with respect to one (1) or more country(ies)) in accordance with the provisions hereof shall not limit remedies that may otherwise be available in law or equity.

10.6.Accrued Rights; Surviving Obligations. Termination or expiration of this Agreement (either in its entirety or with respect to one (1) or more country(ies)) for any reason shall be without prejudice to any rights that shall have accrued to the benefit of a Party prior to such termination or expiration. Such termination or expiration shall not relieve a Party from obligations that are expressly indicated to survive the termination or expiration of this Agreement. Without limiting the foregoing, Sections 2.1 (including Section 4.3.4(b), to the extent necessary to give effect to Section 2.1) and 2.7 (in each case, to the extent provided in Section 10.4.1); 2.2 (including Section 4.3.4(a), to the extent necessary to give effect to Section 2.2); 2.3.1 (subsections (i) and (ii) of first sentence, to the extent the MedImmune License and the Wacker License are then still in force and effective, and second and third sentences); 2.4.1; 2.5 (to the extent provided in Section 10.4.2(h) or Section 10.4.3(h), as applicable); 4.2.7 (for the period specified therein); 4.3.4; 4.4.3; 4.5 (second sentence); 4.7 (with respect to subcontracts entered into prior to termination, but limited in the case of Licensed Product Agreements assigned to Licensor to obligations and liabilities in relation to such assigned Licensed Product Agreements arising prior to assignment to Licensor or out of circumstances or events occurring prior such assignment); 5.4 (for final accounting but excluding the second-to-last sentence); 5.5 (for final accounting); 5.6-5.7; 5.8-5.9 (for the period specified in Section 5.8); 5.10; 6.1; 6.3.3; 6.3.4 (with respect to Licensor’s rights to settle in relation to any AstraZeneca Product Patents); 6.3.5 (with respect to Licensor’s rights to settle in relation to any AstraZeneca Product Patents); 6.4 (with respect to claims arising from Exploitation prior to termination); 6.6 (to the extent necessary to give effect to Section 10.4.1); 6.7.1 (first sentence); 7.1-7.2 (for the period specified therein); 7.3-7.7; 7.8 (to the extent the Wacker License is then still in force and effective); 10.3; 10.4.1; 10.4.2 or 10.4.3 (as applicable); 10.4.4; 10.5 and this Section 10.6 and Articles 1 (to the extent necessary to give effect to the other articles and sections set forth in this Section 10.6), 9 and 11 (other than Section 11.3.1(b)and Section 11.4)of this Agreement shall survive the termination or expiration of this Agreement for any reason. If this Agreement is terminated with respect to the Terminated Territory but not in its entirety, then following such termination (i) the foregoing provisions of this Agreement shall remain in effect with respect to the Terminated Territory (to the extent they would survive and apply in the event the Agreement expires or is

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terminated in its entirety or as otherwise necessary for any of Licensor and its Affiliates and its and their (sub)licensees to exercise their rights in the Terminated Territory).

ARTICLE 11
MISCELLANEOUS

11.1.Force Majeure. Neither Party shall be held liable or responsible to the other Party or be deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling or performing any term of this Agreement (other than an obligation to make payments) when such failure or delay is caused by or results from events beyond the reasonable control of the non-performing Party, including fires, floods, earthquakes, hurricanes, embargoes, shortages, epidemics, quarantines, war, acts of war (whether war be declared or not), terrorist acts, insurrections, riots, civil commotion, strikes, lockouts or other labor disturbances (whether involving the workforce of the non-performing Party or of any other Person), acts of God or acts, omissions or delays in acting by any Governmental Authority (except to the extent such delay results from the breach by the non-performing Party or any of its Affiliates of any term or condition of this Agreement). The non-performing Party shall notify the other Party of such force majeure within thirty (30) days after such occurrence by giving written notice to the other Party stating the nature of the event, its anticipated duration and any action being taken to avoid or minimize its effect. The suspension of performance shall be of no greater scope and no longer duration than is necessary and the non-performing Party shall use commercially reasonable efforts to remedy its inability to perform. Without limitation to the foregoing, in the event that the suspension of performance continues for one hundred eighty (180) days after the date of the occurrence and such suspension of performance would constitute a material breach of this Agreement in the absence of this Section 11.1, the other Party shall have the right to terminate this Agreement pursuant to Section 10.2.1 without regard to this Section 11.1, except that in such event no cure period shall apply and the other Party shall have the right in its sole discretion to effect such termination upon written notice to the non-performing Party, either solely with respect to the country affected by such non-performance or in its entirety.

11.2.Export Control. This Agreement is made subject to any restrictions concerning the export of products or technical information from the United States or other countries that may be imposed on the Parties from time to time. Each Party agrees that it will not export, directly or indirectly, any technical information acquired from the other Party under this Agreement or any products using such technical information to a location or in a manner that at the time of export requires an export license or other governmental approval, without first obtaining the written consent to do so from the appropriate agency or other governmental entity in accordance with Applicable Law.

11.3.Assignment. Neither Party may assign its rights or, except as permitted in Section 4.7, delegate its obligations under this Agreement, whether by operation of law or otherwise, in whole or in part without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed; provided, however, that either Party may assign this Agreement and its rights and obligations hereunder without the other Party’s consent:

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11.3.1.in connection with the transfer or sale of all or substantially all of the business of such Party to which this Agreement relates to a Third Party (“Third Party Acquirer”), whether by merger, sale of stock, sale of assets or otherwise, and whether or not such Party is the surviving entity (each, a “Sale Transaction”); provided that in the event of a Sale Transaction (whether this Agreement is actually assigned or is assumed by the Third Party Acquirer or the surviving corporation resulting from such Sale Transaction by operation of law (e.g., in the context of a reverse triangular merger)):

(a)Information, materials and intellectual property rights controlled by the Third Party Acquirer (other than as a result of a license or other grant of rights, covenant or assignment by the assigning Party or its Affiliates to, or for the benefit of, such Third Party Acquirer) that existed prior to the Sale Transaction shall not be included in the technology licensed hereunder or otherwise subject to this Agreement; and

(b)in the case of a Sale Transaction involving a Party, the exclusivity provisions of Section 2.5 shall not apply to any Competing Product being developed or commercialized by the Third Party Acquirer or any of its Affiliates (other than a Party or any Person that was an Affiliate of Licensor prior to the consummation of the Sale Transaction) prior to such Sale Transaction; provided that a Party or the surviving corporation, as the case may be, shall establish reasonable internal safeguards designed to prevent any Licensed Know-How from being utilized in furtherance of the development or commercialization of, or otherwise for the benefit of, such Competing Product;

11.3.2.to an Affiliate, provided that the assigning Party shall remain liable and responsible to the non-assigning Party hereto for the performance and observance of all such duties and obligations by such Affiliate;

provided that, in each case (Section 11.3.1 and Section 11.3.2), the assigning Party shall provide written notice to the other Party within thirty (30) days after such assignment. The rights and obligations of the Parties under this Agreement shall be binding upon and inure to the benefit of the successors and permitted assigns of the Parties, and the name of a Party appearing herein will be deemed to include the name of such Party’s successors and permitted assigns to the extent necessary to carry out the intent of this section. Any attempted assignment in violation of this Section 11.3 shall be void and of no effect.

11.4.Other Strategic Transactions. In the event that either Party or its Affiliate acquires, whether by merger, purchase of stock or purchase of assets, a Third Party in a transaction that is not a Sale Transaction, or a business unit or a portfolio of products of a Third Party (which portfolio includes one (1) or more Competing Products and one (1) or more other products that are not Competing Products) (each a “Strategic Transaction”), and the Third Party with which such Strategic Transaction is consummated or any of its Affiliates (other than such Party or any Person which was an Affiliate of such Party prior to consummation of such Strategic Transaction) was engaged in development or commercialization of a Competing Product prior to such consummation (each a “Permitted Competing Product”), then following

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consummation of such Strategic Transaction the provisions of Section 2.5 and Section 2.6 (as the case may be) shall not apply to such Permitted Competing Product, provided that such Party shall establish reasonable internal safeguards designed to prevent any Licensed Know-How or Licensee Know-How from being utilized in furtherance of the development or commercialization of, or otherwise for the benefit of, the applicable Permitted Competing Product.

11.4.1.Except in circumstances in which Section 11.3.1(b) applies (in which case Section 11.3.1(b) shall control), in the event that Licensor or its Affiliate sells or transfers to any Third Party, in one or more related transactions, properties or assets representing all or substantially all of Licensor’s or such Affiliate’s consolidated total assets with respect to the Licensed Compound and Licensed Product, and the Third Party with which such transaction is consummated or any of its Affiliates (other than Licensor or any Person which was an Affiliate of Licensor prior to consummation of such transaction) owns or controls, or is engaged in development or commercialization of, a Competing Product prior to such consummation, then following such consummation of such transaction the Exclusive Period during which the provisions of Section 2.6 apply shall automatically be deemed to be limited to (a) with respect to the conduct of human clinical trials of such Competing Product, the shorter of (i) the period of three (3) years beginning on the effective date of such transaction or (ii) the period of five (5) years beginning on the Effective Date, and (b) with respect to the sale or offer for sale of such Competing Product, the shorter of (i) the period of five (5) years beginning on the effective date of such transaction and (ii) the period of seven (7) years beginning on the Effective Date.

11.5.Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable under any present or future law and if the rights or obligations of either Party under this Agreement will not be materially and adversely affected thereby, (a) such provision shall be fully severable, (b) this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (c) the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom, and (d) in lieu of such illegal, invalid or unenforceable provision, there shall be added automatically as a part of this Agreement a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and reasonably acceptable to the Parties. To the fullest extent permitted by Applicable Law, each Party hereby waives any provision of law that would render any provision hereof illegal, invalid or unenforceable in any respect.

11.6.Dispute Resolution.

11.6.1.Except as provided in Section 5.9, Section 6.2.5, Section 10.2.3 or Section 11.11, if a dispute arises between the Parties in connection with or relating to this Agreement or any document or instrument delivered in connection herewith (a “Dispute”), then either Party shall have the right to refer such Dispute to the Senior Officers for attempted resolution by good faith negotiations during a period of ten (10) Business Days. Any final decision mutually agreed to by the Senior Officers shall be set

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forth in writing and signed by both Parties, whereupon it will be conclusive and binding on the Parties.

11.6.2.If such Senior Officers are unable to resolve any such Dispute within such ten (10)-Business Day period, except as otherwise set forth in Section 5.9, Section 6.2.5, Section 10.2.3, Section 11.6.5 or Section 11.11, either Party shall be free to institute binding arbitration in accordance with Section 11.6.3 upon written notice to the other Party (an “Arbitration Notice”) and seek such remedies as may be available.

11.6.3.Upon receipt of an Arbitration Notice by a Party, the applicable Dispute shall be resolved by final and binding arbitration before a panel of three (3) experts with relevant industry experience (the “Arbitrators”). Each of Licensee and Licensor shall promptly select one (1) Arbitrator, which selections shall in no event be made later than thirty (30) days after the notice of initiation of arbitration. The third Arbitrator shall be chosen promptly by mutual agreement of the Arbitrator chosen by Licensee and the Arbitrator chosen by Licensor, but in no event later than thirty (30) days after the date that the last of such Arbitrators was appointed. The Arbitrators shall determine what discovery will be permitted, consistent with the goal of reasonably controlling the cost and time that the Parties must expend for discovery; provided that the Arbitrators shall permit such discovery as they deem necessary to permit an equitable resolution of the dispute. The arbitration shall be administered by the American Arbitration Association (or its successor entity) (“AAA”) in accordance with the then current Commercial Rules of the American Arbitration Association including the Procedures for Large, Complex Commercial Disputes (including the Optional Rules for Emergency Measures of Protection), except as modified in this Agreement. The arbitration shall be held in the State of New York. The Arbitrators shall, within fifteen (15) days after the conclusion of the arbitration hearing, issue a written award and statement of decision describing the essential findings and conclusions on which the award is based, including the calculation of any damages awarded. The decision or award rendered by the Arbitrators shall be final and non-appealable, and judgment may be entered upon it in accordance with Applicable Law in any court of competent jurisdiction. The Arbitrators’ authority to award special, incidental, consequential or punitive damages shall be subject to the limitation set forth in Section 9.4. The Arbitrators shall not be authorized to reform, modify or materially change this Agreement or any other agreements contemplated hereunder.

11.6.4.Each Party shall bear its own counsel fees, costs, and disbursements arising out of the dispute resolution procedures described in this Section 11.6, and shall pay an equal share of the fees and costs of the Arbitrators and all other general fees related to any arbitration described in Section 11.6.3; provided, however, the Arbitrators shall be authorized to determine whether a Party is the prevailing Party, and if so, to award to that prevailing Party reimbursement for any or all of its reasonable counsel fees, costs and disbursements (including expert witness fees and expenses, photocopy charges, or travel expenses), or the fees and costs of the Arbitrators. Unless the Parties otherwise agree in writing, during the period of time that any arbitration proceeding described in

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Section 11.6.3 is pending under this Agreement, the Parties shall continue to comply with all those terms and provisions of this Agreement that are not the subject of such pending arbitration proceeding. Nothing contained in this Agreement shall deny any Party the right to seek injunctive or other equitable relief from a court of competent jurisdiction in the context of a bona fide emergency or prospective irreparable harm, and such an action may be filed and maintained notwithstanding any ongoing discussions between the Senior Officers or any ongoing arbitration proceeding. All arbitration proceedings and decisions of the Arbitrator under this Section 11.6 shall be deemed Confidential Information of both Parties under Article 7.

11.6.5.Notwithstanding the foregoing, in the event that a Dispute arises with respect to the validity, scope, enforceability, inventorship or ownership of any Patent, Trademark or other intellectual property rights, either Party may bring an action in a court of competent jurisdiction in accordance with Sections 11.7.2 and 11.7.3 (or, as applicable, with any patent or trademark authority of competent jurisdiction) to resolve such Dispute, and no such Dispute shall be subject to arbitration pursuant to Section 11.6.2 or Section 11.6.3.

11.7.Governing Law, Jurisdiction and Service.

11.7.1.Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. The Parties agree to exclude the application to this Agreement of the United Nations Convention on Contracts for the International Sale of Goods.

11.7.2.Jurisdiction. Subject to Section 11.6 and Section 11.11, the Parties hereby irrevocably and unconditionally consent to the exclusive jurisdiction of federal and state courts sitting in the State of New York for any action, suit or proceeding (other than appeals therefrom) arising out of or relating to this Agreement and agree not to commence any action, suit or proceeding (other than appeals therefrom) related thereto except in such courts; provided, however, that in the case of (a) any action, suit or proceeding with respect to the validity, scope, enforceability, inventorship or ownership of any Patent, Trademark or other intellectual property rights, or (b) any action seeking only injunctive or other equitable relief, including specific performance, in each case ((a) and (b)) for which (and to the extent) federal and state courts sitting in the State of New York lack authority to issue the relief sought, each Party shall have a right to pursue such action, suit or proceeding in any court of competent jurisdiction (or, as applicable, with any patent or trademark authority of competent jurisdiction). The Parties irrevocably and unconditionally waive their right to a jury trial.

11.7.3.Venue. The Parties further hereby irrevocably and unconditionally waive any objection to the laying of venue of any action, suit or proceeding (other than appeals therefrom) arising out of or relating to this Agreement in federal and state courts sitting in the State of New York and hereby further irrevocably and unconditionally waive and

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agree not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum; provided, however, that in the case of (a) any action, suit or proceeding with respect to the validity, scope, enforceability, inventorship or ownership of any Patent, Trademark or other intellectual property rights, or (b) any action seeking only injunctive or other equitable relief, including specific performance, in each case ((a) and (b)) for which venue cannot be established in federal and state courts sitting in the State of New York, each Party shall have a right to pursue such action, suit or proceeding in any court of competent jurisdiction (or, as applicable, with any patent or trademark authority of competent jurisdiction).

11.7.4.Service. Each Party further agrees that service of any process, summons, notice or document by registered mail to its address set forth in Section 11.8.2 shall be effective service of process for any action, suit or proceeding brought against it under this Agreement in any such court.

11.8.Notices.

11.8.1.Notice Requirements. Any notice, request, demand, waiver, consent, approval or other communication permitted or required under this Agreement shall be in writing, shall refer specifically to this Agreement and shall be deemed given only if delivered by hand or sent by facsimile transmission (with transmission confirmed) or by internationally recognized overnight delivery service that maintains records of delivery, addressed to the Parties at their respective addresses specified in Section 11.8.2 or to such other address as the Party to whom notice is to be given may have provided to the other Party in accordance with this Section 11.8.1. Such notice shall be deemed to have been given as of the date delivered by hand or transmitted by facsimile (with transmission confirmed) or on the second Business Day (at the place of delivery) after deposit with an internationally recognized overnight delivery service. Any notice delivered by facsimile shall be confirmed by a hard copy delivered as soon as practicable thereafter. This Section 11.8.1 is not intended to govern the day-to-day business communications necessary between the Parties in performing their obligations under the terms of this Agreement.

11.8.2.Address for Notice.

If to Licensor, to:

PhaseBio Pharmaceuticals, Inc.

1 Great Valley Parkway, Suite 30

Malvern, PA 19355

United States

Attention: Chief Executive Officer

Facsimile: +1 610-981-6520

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with a copy (which shall not constitute notice) to:

Cooley LLP

Reston Town Center

11951 Freedom Drive

14th Floor

Reston, VA 20190-5640

United States

Attention: Christian Plaza

Facsimile: +1 703-456-8100

If to Licensee, to:

Alfasigma S.p.A.

Via Ragazzi del ’99 no. 5

40133 Bologna, Italy

Attention: Corporate General Counsel

11.9.Entire Agreement; Amendments. This Agreement, together with the Schedules attached hereto, sets forth and constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and all prior agreements, understandings, promises and representations, whether written or oral, with respect thereto. Each Party confirms that it is not relying on any representations or warranties of the other Party except as specifically set forth in this Agreement. No amendment, modification, release or discharge shall be binding on the Parties unless in writing and duly executed by authorized representatives of both Parties. In the event of any inconsistencies between this Agreement and any schedules or other attachments hereto, the terms of this Agreement shall control. Specifically and without limiting the foregoing, this Agreement shall supersede that certain One-Way Non-Disclosure Agreement entered into by and between the Parties as of July 1, 2020, and all confidential information exchanged under such Confidentiality Agreement shall be deemed Confidential Information of the applicable Party under this Agreement.

11.10.English Language. This Agreement has been prepared in the English language, and the English language shall control its interpretation. All notices and other communications under or in connection with this Agreement shall be in the English language. Any translation into any other language shall not be an official version thereof and in the event of any conflict in interpretation between the English version and such translation, the English version shall control.

11.11.Equitable Relief. Each Party acknowledges and agrees that the restrictions set forth in Section 2.5, Article 6 and Article 7 are reasonable and necessary to protect the legitimate interests of the other Party and that such other Party would not have entered into this Agreement in the absence of such restrictions and that any breach or threatened breach of any provision of such Section or Articles may result in irreparable injury to such other Party for which there may be no adequate remedy at law. In the event of a breach or threatened breach of any provision of such Section or Articles, the non-breaching Party shall have the right to seek from any court of competent jurisdiction injunctive or other equitable relief, including specific performance, in

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addition to any other rights or remedies to which such non-breaching Party may be entitled in law or equity. Nothing in this Section 11.11 is intended or should be construed, to limit either Party’s right to equitable relief or any other remedy for a breach of any other provision of this Agreement.

11.12.Waiver and Non-Exclusion of Remedies. Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such term or condition. The waiver by either Party of any right hereunder or of the failure to perform or of a breach by the other Party shall not be deemed a waiver of any other right hereunder or of any other breach or failure by such other Party whether of a similar nature or otherwise. The rights and remedies provided herein are cumulative and do not exclude any other right or remedy provided by Applicable Law or otherwise available except as expressly set forth herein.

11.13.No Benefit to Third Parties. Except as provided in Article 9, the covenants and agreements set forth in this Agreement are for the sole benefit of the Parties and their successors and permitted assigns and they shall not be construed as conferring any rights on any other Persons.

11.14.Further Assurance. Each Party shall duly execute and deliver or cause to be duly executed and delivered, such further instruments and do and cause to be done such further acts and things, including the filing of such assignments, agreements, documents and instruments, as may be necessary or as the other Party may reasonably request in connection with this Agreement or to carry out more effectively the provisions and purposes hereof or to better assure and confirm unto such other Party its rights and remedies under this Agreement.

11.15.Relationship of the Parties. It is expressly agreed that Licensor, on the one hand, and Licensee, on the other hand, shall be independent contractors and that the relationship between the two Parties shall not constitute a partnership, joint venture or agency. Neither Licensor, on the one hand, nor Licensee, on the other hand, shall have the authority to make any statements, representations or commitments of any kind or to take any action that will be binding on the other Party without the prior written consent of the other Party to do so. All persons employed by a Party shall be employees of such Party and not of the other Party and all costs and obligations incurred by reason of any such employment shall be for the account and expense of such first Party. The Parties (and any successor, assignee, transferee, or Affiliate of a Party) shall not treat or report the relationship between the Parties arising under this Agreement as a partnership for United States tax purposes, unless required by Applicable Laws.

11.16.References. Unless otherwise specified, (a) references in this Agreement to any Article, Section or Schedule shall mean references to such Article, Section or Schedule of this Agreement, (b) references in any Section to any clause are references to such clause of such Section, and (c) references to any agreement, instrument or other document in this Agreement refer to such agreement, instrument or other document as originally executed or, if subsequently amended, replaced or supplemented from time to time, as so amended, replaced or supplemented and in effect at the relevant time of reference thereto.

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11.17.Construction. Except where the context otherwise requires, wherever used, the singular shall include the plural, the plural the singular, the use of any gender shall be applicable to all genders and the word “or” is used in the inclusive sense (and/or). Whenever this Agreement refers to a number of days, unless otherwise specified, such number refers to calendar days. The captions of this Agreement are for convenience of reference only and in no way define, describe, extend or limit the scope or intent of this Agreement or the intent of any provision contained in this Agreement. The term “including,” “include,” or “includes” as used herein shall mean including, without limiting the generality of any description preceding such term. The language of this Agreement shall be deemed to be the language mutually chosen by the Parties and no rule of strict construction shall be applied against either Party.

11.18.Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be executed by facsimile, PDF format via email, or other electronically transmitted signatures and such signatures shall be deemed to bind each Party as if they were original signatures.

[SIGNATURE PAGE FOLLOWS.]

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THIS AGREEMENT IS EXECUTED by the authorized representatives of the Parties as of the date first written above.

ALFASIGMA S.P.A.    PHASEBIO PHARMACEUTICALS, INC.

By: /s/ Pier Vincenzo Colli        By: /s/ Jonathan Mow    

Name: Pier Vincenzo Colli        Name: Jonathan Mow    

Title: Chief Executive Officer        Title: Chief Executive Officer    

[SIGNATURE PAGE TO LICENSE AGREEMENT]

Schedule 1.41

Development Plan

[***]

Schedule 1.76

MEDI2452

[***]

Schedule 1.77

Licensed Know-How

[***]

Schedule 1.78

Licensed Patents

[***]

Schedule 1.83

Licensee Corporate Names

Schedule 1.90

Licensor Corporate Names

PhaseBio

PhaseBio Pharmaceuticals

PhaseBio Pharmaceuticals, Inc.

Schedule 1.104

MedImmune Corporate Names

Schedule 4.1.2

Supply Agreement Terms

Within one hundred twenty (120) days after the Effective Date, the Parties shall negotiate in good faith and enter into a supply agreement and related quality agreement for the Manufacture and supply of the Licensed Product by Licensor to Licensee. The terms and descriptions outlined below (the “Supply Agreement Terms”), together with any terms contained or described in this Agreement, will be mandatorily included in a definitive Supply Agreement between the Parties (together with such other terms as the Parties shall mutually agree). Capitalized terms used, but not defined, in these Supply Agreement Terms shall have the meaning given to such terms in this Agreement.

[***]

Schedule 4.3.6(h)

Serious Adverse Event Reporting Timelines

[***]

Exhibit 4.3.6(a)

Copies of MedImmune Pharmacovigilance Agreement and
SFJ Pharmacovigilance Agreement

[***]

EX-10.2

Exhibit 10.2

Certain portions of this exhibit (indicated by “[***]”) have been excluded pursuant to Item 601(b)(10) of Regulation S-K because they are both not material and are the type that the registrant treats as private or confidential.

ACKNOWLEDGMENT OF GRANT OF A SUBLICENSE IN ACCORDANCE WITH THE LICENSE AGREEMENT BETWEEN MEDIMMUNE LIMITED AND PHASEBIO PHARMACEUTICALS, INC. AND RELATED OPTIONS

This Agreement (“Agreement”) is made and entered into as of June 16, 2021 (the “Effective Date”), by and between (1) MedImmune Limited, a limited liability company formed under the laws of the United Kingdom having a place of business at Milstein Building, Granta Park, Cambridge CB21 6GH, United Kingdom (“MedImmune”); (2) PhaseBio Pharmaceuticals, Inc., a corporation formed under the laws of the State of Delaware with a principal place of business at 1 Great Valley Parkway, Suite 30, Malvern, Pennsylvania 19355, USA (“PhaseBio”); and (3) Alfasigma S.P.A. a company organized and existing under the laws of Italy having a place of business at Via Ragazzi del ’99.5. 1-40133 Bologna, Italy (“Alfasigma”).

Recitals

WHEREAS, MedImmune and PhaseBio are parties to that certain license agreement dated November 21, 2017, as amended (the “AZ License”), pursuant to which MedImmune granted to PhaseBio a license under certain intellectual property rights owned or controlled by MedImmune to develop and commercialize Licensed Products in the Field in the Territory in accordance with the terms and conditions set forth in the AZ License;

WHEREAS, PhaseBio proposes to grant to Alfasigma a sublicense of certain of the rights granted to PhaseBio by MedImmune pursuant to the AZ License with respect to the European Union and certain other countries (the “Sublicense Market”); a redacted copy of the sublicense agreement is attached as Exhibit B to this Agreement (the “Sublicense”);

WHEREAS, pursuant to Section 2.3 of the AZ License, PhaseBio may enter into the Sublicense provided that such Sublicense is consistent with the terms and conditions of the AZ License; and

WHEREAS, this Agreement sets out MedImmune’s acknowledgement that PhaseBio has entered into the Sublicense and certain other matters relating to the relationship between MedImmune, PhaseBio and Alfasigma.

NOW, THEREFORE, in consideration of the premises and the mutual promises and conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, do hereby agree as follows:

1.Defined Terms. Capitalized terms used but not otherwise defined in this Agreement have the meanings ascribed to such terms in the AZ License.

2.Acknowledgment of the Grant of the Sublicense to Alfasigma. MedImmune hereby acknowledges receipt of a redacted copy of the Sublicense attached hereto as Exhibit B. PhaseBio represents that (a) except for those provisions of the Sublicense set forth on Exhibit A

attached hereto that are in conflict with the terms of the AZ License, the Sublicense is in accordance with the requirements of Section 2.3.1 of the AZ License and (b) except as expressly set forth in this Agreement, MedImmune will not be required to assume any obligations or liabilities in respect of such Sublicense that are in addition to, or greater in scope than, MedImmune’s obligations or liabilities set forth in the AZ License.

3.MedImmune Option to Sublicense and Alfasigma Option to AZ License

(a)Notwithstanding the provisions of Sections 9.2.1(a), 9.2.1(b) and 9.2.2 of the AZ License, if MedImmune becomes, or believes in good faith that it is entitled to terminate the AZ License pursuant to Sections 9.2.1(a), 9.2.1(b) or 9.2.2 thereof (the “Termination Entitlement Event”), then MedImmune:

(i)should it wish to invoke its right to termination, pursuant to Sections 9.2.1(a) or 9.2.1(b) of the AZ License, shall provide written notice pursuant to those Sections of such entitlement to PhaseBio and (pursuant to Section 3(b) of the January 9, 2020 amendment to the AZ License) to SFJ, with a copy to Alfasigma, specifying the applicable Section of the AZ License under which MedImmune is, or believes it is, entitled to terminate the AZ License.

(ii)shall within thirty (30) calendar days after the occurrence of the Termination Entitlement Event pursuant to Section 9.2.2 of the AZ License, and at least thirty (30) calendar days prior to delivering any notice to PhaseBio pursuant to Section 9.2.2 of the AZ License, deliver written notice of such entitlement to Alfasigma and (pursuant to Section 3(b) of the January 9, 2020 amendment to the AZ License) to SFJ, with a copy to PhaseBio.

Any notice provided pursuant to this Section 3(a) shall be considered a “Termination Entitlement Notice”.

(b)If the Termination Entitlement Notice is served at any time prior to the Regulatory Documentation Assignment Date (as defined in the Sublicense) the following provisions shall apply:

(i)If (A) the grounds for termination specified in the Termination Entitlement Notice trigger Section 3.20(b) of the January 9, 2020 Co-Development Agreement between PhaseBio and SFJ Pharmaceuticals X, Ltd. (“SFJ”) (the “Co-Development Agreement”); (B) such grounds for termination are not cured or remedied in accordance with the terms of the Co-Development Agreement; and (C) SFJ does not elect to execute a program transfer pursuant to Section 3.20 of the Co-Development Agreement, as further described in the January 9, 2020 amendment to the AZ License, MedImmune may at its sole discretion, within forty-five (45) calendar days of receipt of notice of SFJ’s decision not to execute a program transfer (“MedImmune’s Decision Period”):

(1)Notify Alfasigma and PhaseBio that it requires PhaseBio to assign the Sublicense to MedImmune pursuant to the Sublicense Assignment Agreement (attached thereto as Exhibit C) and that MedImmune will undertake all rights and obligations of PhaseBio

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as set out in the Sublicense; in such instance, all parties shall execute the Sublicense Assignment Agreement and/or any required agreements ancillary thereto under Section 3(b)(i) within thirty (30) calendar days of receipt of the notice from MedImmune by Alfasigma and PhaseBio; or

(2)Notify Alfasigma and PhaseBio that would like to enter into good faith negotiations with Alfasigma for the commercialization of the Licensed Product in the Territory. If pursuant to such good faith negotiations no agreement for the commercialization of the Licensed Product between MedImmune and Alfasigma is reached within thirty (30) calendar days of the notice under 3(b)(i)(2) of this Agreement, Section 3(b)(ii) of this Agreement shall apply, provided that such thirty (30) calendar day-period shall be extended by the number of days (if any) between (x) the day of receipt of the notice from MedImmune by Alfasigma and PhaseBio and (y) the forty-fifth (45th) day of the MedImmune’s Decision Period (the “Negotiation Period”).

MedImmune undertakes that it will not terminate the AZ License during the period from the date of the Termination Entitlement Notice to the date on which the Sublicense Assignment Agreement and/or any required agreements are signed by all parties pursuant to this Section 3(b)(i).

(ii)If MedImmune (A) does not exercise its right to require assignment of the Sublicense from PhaseBio to Alfasigma pursuant to Section 3(b)(i)(1) above, or does not otherwise provide notice pursuant to Section 3(b)(i) above, in each case within MedImmune’s Decision Period, and (B) does not enter into an agreement with Alfasigma for the commercialization of the Licensed Product pursuant to Section 3(b)(i)(2) above, then Alfasigma may, at its sole discretion within thirty (30) calendar days of, respectively, (x) the last day of MedImmune’s Decision Period, in the case under (A) above, or (y) the expiry of the Negotiation Period, in the case under (B) above, notify MedImmune and PhaseBio that Alfasigma requires PhaseBio to assign the AZ License to Alfasigma pursuant to the AZ License Assignment Agreement (attached hereto as Exhibit D). All parties shall execute the AZ License Assignment Agreement any agreements ancillary thereto within thirty (30) calendar days of receipt of this notice from Alfasigma by MedImmune and PhaseBio. MedImmune undertakes that it will not terminate the AZ License during the period from the date of the Termination Entitlement Notice to the date on which the AZ License Assignment Agreement and any required agreements ancillary thereto are signed by all parties.

(c)If the Termination Entitlement Notice is served at any time on or after the Regulatory Documentation Assignment Date the following provisions shall apply:

(i)Alfasigma shall have the right within sixty (60) days of receipt of a Termination Entitlement Notice to notify MedImmune that Alfasigma requires the grant to Alfasigma of a Standby License (as defined in Section 2.3.2 of the AZ License) on the terms set forth herein, and such Standby License shall come into full force and effect from the date of termination of the AZ License.

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(ii)The terms of the Standby License shall be as follows and shall apply to MedImmune and Alfasigma with effect from the date of termination of the AZ License by MedImmune pursuant to Section 9.2.1(a), Section 9.2.1(b) or Section 9.2.2:

(1)Alfasigma will perform and continue to perform the relevant activities with respect to the Licensed Product sublicensed to it under the Sublicense that PhaseBio would have been obligated to perform under the AZ License with respect to such Licensed Product in the absence of termination of the AZ License, in each case in the Sublicensee Market only or to the extent otherwise reasonably necessary to enable Exploitation of the Licensed Product(s) for the Sublicense Market;

(2)MedImmune will not be required to assume any obligations or liabilities in respect of such Sublicense that are in addition to, or greater in scope than, MedImmune’s obligations or liabilities set forth in the AZ License, unless MedImmune otherwise agrees in writing;

(3)Alfasigma will not be required to assume any obligations or liabilities in respect of such Standby License that are in addition to, or greater in scope than, Alfasigma’s obligations or liabilities set forth in the Sublicense, unless Alfasigma otherwise agrees in writing;

(4)Alfasigma acknowledges and agrees that, following any termination of the AZ License, the obligations of PhaseBio under the AZ License and the Pharmacovigilance Agreement:

a.to the extent applicable to the rights and licenses granted to Alfasigma pursuant to the Sublicense will be direct obligations of Alfasigma to MedImmune (and that, without limitation to the rights of MedImmune and PhaseBio pursuant to Section 9.6 of the AZ License, termination of the AZ License in its entirety or in a Terminated Territory with respect to PhaseBio will not terminate such obligations with respect to Alfasigma); and

b.MedImmune will have the right to enforce: (x) such obligations; and (y) any terms of the AZ License which are otherwise applicable to Alfasigma as the sublicensee under the Sublicense, in each case ((x) and (y)) directly against Alfasigma;

(5)(A) any payment obligations to PhaseBio arising under the Sublicense in consideration for the Sublicense after termination of the AZ License will become direct payment obligations of Alfasigma to MedImmune, directly payable to MedImmune (it being understood, however, that, except with respect to any payments due as compensation for any performance obligations that MedImmune elects to assume or perform in connection with the Standby License, MedImmune would not be entitled to receive payments due to PhaseBio under the Sublicense that are for value other than, and not in consideration for, the Sublicense – e.g., payments of PhaseBio’s fully-burdened cost of performing bona fide research and development activities for or with Alfasigma, reimbursements of reasonable and documented external costs incurred by PhaseBio in performing such activities, and payments for equity or

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debt securities of PhaseBio or any of its Affiliates), and (B) MedImmune will have the right to enforce the obligations described in subsection (5)(A) directly against Alfasigma;

(6)in the event of any subsequent termination of the Sublicense, MedImmune will automatically receive from Alfasigma the full scope of rights provided in Sections 9.4.2 or 9.4.3 of the AZ License, as applicable, with respect to the applicable Licensed Product in the Sublicense Market as if Alfasigma were subject to such terms without qualifying as having a “Surviving Sublicense” as such term is used in such sections; and

(7)the rights afforded to Alfasigma under this subsection (ii) are subject to Alfasigma remaining in compliance with this Agreement and the Sublicense at the date on which it wishes to exercise its rights.

(iii)In no case shall Alfasigma assume any obligations or liabilities of PhaseBio to MedImmune pursuant to the AZ License accrued prior to execution of the Standby License.

4.If, at any time:

(i)SFJ is entitled to require PhaseBio to execute a program transfer pursuant to Section 3.20(b) of the Co-Development Agreement, as further described in the January 9, 2020 amendment to the AZ License, but SFJ elects not to do so; and

(ii)either:

(1)MedImmune requires PhaseBio to assign the Sublicense to MedImmune pursuant to the Sublicense Assignment Agreement pursuant to Section 3(b)(i) above; or

(2) Alfasigma requires PhaseBio to assign the AZ License to Alfasigma pursuant to the AZ License Assignment Agreement pursuant to Section 3(b)(ii) above; or

(3)MedImmune grants a Standby License to Alfasigma pursuant to Section 3(c) above,

Alfasigma may deliver written notice to PhaseBio requiring PhaseBio to assign (x) any and all agreements and intellectual property rights Controlled by PhaseBio relating to, or otherwise required for, the Exploitation of the Licensed Compound and/or Licensed Product (which such agreements and rights PhaseBio shall have authority to assign or obtain such authority to assign); and, (y) to the extent PhaseBio is free to do so pursuant to the then existing Licensed Product Agreements relating to the Exploitation of the Licensed Product, the Regulatory Documentation to MedImmune and/or Alfasigma, in each case as necessary for MedImmune and/or Alfasigma, in each case, to develop, manufacture and commercialize the Licensed Compound and/or Licensed Products, including the Wacker License Agreement dated April 1, 2019, as amended, and the BioVectra Supply Agreement dated March 10, 2021, without any additional cost or

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compensation payable by Alfasigma and/or MedImmune and free of any liens and encumbrances. In addition, following the earlier of (A) receipt of “Regulatory Approval” of the Licensed Product for the “Indication” in at least one of the United States, the European Union, any “Designated European Country”, Japan or China (as such terms are defined in the Co-Development Agreement) or (B) termination of the Co-Development Agreement in accordance with any termination clause or section thereof, upon request of MedImmune and/or Alfasigma, PhaseBio shall promptly enter into the Trial Data Package Agreement with SFJ attached as Exhibit K to the Co-Development Agreement and transfer and assign to MedImmune and/or Alfasigma all its rights, title and interest in and to the Trial Data Package, without any additional cost or compensation payable by MedImmune and/or Alfasigma and free of any liens and encumbrances, to the extent necessary to develop and commercialize the Licensed Product in the Sublicense Market and elsewhere. For the avoidance of doubt, neither MedImmune nor Alfasigma will assume any obligation of PhaseBio, including any financial obligation, under the Co-Development Agreement and for which PhaseBio shall retain sole responsibility.

For the avoidance of doubt, in the event the AZ License is Assigned by PhaseBio to Alfasigma pursuant to Section 3(b)(ii), MedImmune shall not be obligated to accept any assignment of such agreements, intellectual property rights or Regulatory Documentation. Any assignment of any agreements, intellectual property or Regulatory Documentation to Alfasigma and/or MedImmune pursuant to this paragraph shall be subject to Alfasigma and/or MedImmune (as the case may be) agreeing to comply with and fulfill any obligations owed by PhaseBio as at the date of the assignment to third parties under sublicenses granted by PhaseBio under the AZ License (provided that neither Alfasigma nor MedImmune, as the case may be, shall be subject to any financial liabilities accrued by PhaseBio prior to the date thereof).

5.Notice. Any notice permitted or required under this Agreement shall be made in accordance with Section 10.9 of the AZ License, for which purpose notices to Alfasigma shall be addressed as follows:

Alfasigma S.P.A.

Via Ragazzi del ’99.5

1-40133 Bologna, Italy

Attention: Corporate General Counsel

6.Effectiveness of AZ License. For the avoidance of doubt, notwithstanding the terms of this Agreement, the AZ License shall remain in full force and effect in accordance with its terms and Alfasigma shall not be responsible for any financial or payment obligations that accrue to PhaseBio under the AZ License or the Co-Development Agreement.

7.Counterparts. This Agreement may be executed in three (3) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be executed by facsimile, PDF format via email, or other electronically transmitted signatures and such signatures shall be deemed to bind each Party as if they were original signatures.

6

[SIGNATURE PAGE FOLLOWS.]

7

Exhibit 10.2

.

THIS AGREEMENT IS EXECUTED by the authorized representatives of the parties as of the Effective Date.

MEDIMMUNE LIMITED    PHASEBIO PHARMACEUTICALS, INC.

By: /s/ Greg Mueller        By: /s/ Jonathan Mow            

Name: Greg Mueller        Name: Jonathan Mow            

Title: Authorized Signatory        Title: Chief Executive Officer        

ALFASIGMA S.P.A.

By: /s/ Pier Vincenzo Colli

Name: Pier Vincenzo Colli

Title: Chief Executive Officer

EXHIBIT A

Terms of Sublicense

•Section 2.6 (Exclusivity Commitment of Licensor), in which Alfasigma agrees to the exclusivity obligations set forth therein only with respect to the Territory (and not worldwide).

•Section 3.3 (Licensee Improvements), in which additional provisions (including pursuant to Section 3.3 of the Sublicense) have been added regarding the ability to Alfasigma to undertake research and Development efforts that could generate Improvements that – [***], as follows:

•If at any time Alfasigma wishes to undertake research and Development activities with the aim of generating any Improvements, Alfasigma must first notify the Joint Steering Committee (“JSC”) with reasonable details of its plans and the research and Development activities that it wishes to undertake (the “Proposed Activities”).

•If the JSC does not agree that the Proposed Activities should proceed, Alfasigma may not undertake the Proposed Activities or generate any Licensee Improvements. In the event that the Joint Steering Committee permits the Proposed Activities to proceed, [***].

•If [***].

•If [***], as follows:

•[***].

•[***].

•[***].

•In the event of termination of the AZ License, [***].

EXHIBIT B

Redacted Copy of Sublicense

[Filed as an exhibit to PhaseBio Pharmaceuticals, Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021]

EXHIBIT C

Sublicense Assignment Agreement

This Sublicense Assignment Agreement (this “Sublicense Assignment Agreement”) is dated as of ______, 20__ (the “Assignment Date”), and is entered into by and among (1) MedImmune Limited, a limited liability company formed under the laws of the United Kingdom (“MedImmune”); (2) PhaseBio Pharmaceuticals, Inc., a corporation formed under the laws of the State of Delaware with a principal place of business at 1 Great Valley Parkway, Suite 30, Malvern, Pennsylvania 19355, USA (“PhaseBio”); and (3) Alfasigma S.P.A., a company organized and existing under the laws of Italy, having a place of business at Via Ragazzi del’99 n°5. 1-40133 Bologna, Italy (“Alfasigma”), (collectively the“Parties”).

RECITALS

WHEREAS, PhaseBio and Alfasigma are parties to a Sublicense Agreement dated June 16, 2021 (the “Sublicense Agreement”), and pursuant to that Sublicense Agreement PhaseBio proposes to grant to MedImmune an assignment of the rights granted to PhaseBio by Alfasigma pursuant to that Sublicense Agreement.

NOW, THEREFORE, in consideration of the mutual covenants, terms and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1.Assignment. The Parties intend that this Sublicense Assignment Agreement is a novation and that if the conditions in Section 3(b) of the Acknowledgment of Grant of a Sublicense in Accordance with the License Agreement Between MedImmune Limited and PhaseBio Pharmaceuticals, Inc. and Related Options dated June 16, 2021 are met, the Sublicense Agreement will be assigned and novated in its entirety to MedImmune. On the Assignment Date: (a) PhaseBio hereby irrevocably transfers, assigns and novates to MedImmune, its successors and assigns, all of its rights, title, interest and obligations under, in and to the Sublicense Agreement, and (b) PhaseBio shall be relieved from all duties, obligations and liabilities as they pertain to the Sublicense, except for any obligations that relate to the period prior to the Assignment Date for which PhaseBio retains sole responsibility, including any financial obligations, and those shall not be transferred by this Sublicense Assignment Agreement to neither MedImmune, nor Alfasigma.

2.Assumption. MedImmune hereby acknowledges to Alfasigma that MedImmune accepts the assignment and novation of the Sublicense Agreement, including all of the terms and conditions therein, except for any obligations that relate to the period prior to the Assignment Date for which PhaseBio retains sole responsibility, including any financial obligations, and only assumes obligations as they pertain to the Sublicense Agreement as of the Assignment Date and agrees to be bound by the Sublicense Agreement in all respects as if MedImmune had originally executed the same, except for any obligations that relate to the period prior to the Assignment Date that may continue to accrue on

PhaseBio which shall not be carried forward to neither MedImmune nor Alfasigma through this Sublicense Assignment Agreement. Each reference in the Sublicense Agreement to PhaseBio shall be deemed to mean MedImmune as of the Assignment Date. Alfasigma agrees to perform the Sublicense Agreement and be bound by its terms in every way as if MedImmune were the original party to the Sublicense Agreement in place of PhaseBio.

3.Consent. The Parties acknowledge and agree that an assignment and novation of the Sublicense Agreement by PhaseBio to MedImmune is permissible under Section 11.3 of the Sublicense Agreement. By its signature below, Alfasigma hereby acknowledges and agrees to PhaseBio’s assignment and novation of its rights and obligations under the Sublicense Agreement to MedImmune and MedImmune’s assumption of PhaseBio’s rights and obligations under the Sublicense Agreement pursuant to and in accordance with this Sublicense Assignment Agreement.

4.General. All capitalized terms used in this Sublicense Assignment Agreement and not defined herein shall have the same meaning as set forth in the Sublicense Agreement as applicable. The provisions of the Sublicense Agreement governing choice of law, resolution of disputes, and jurisdiction of legal actions are incorporated herein and made a part of this Sublicense Assignment Agreement. Except as expressly set forth herein, the terms and conditions of the Sublicense Agreement shall remain unmodified by this Sublicense Assignment Agreement. This Sublicense Assignment Agreement constitutes the entire agreement between the Parties pertaining to its subject matter, and supersedes all prior or contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the Parties hereto with respect to such subject matter. No supplement, modification, amendment or waiver of this Sublicense Assignment Agreement shall be binding unless it refers specifically to this Sublicense Assignment Agreement and is executed in writing by MedImmune and Alfasigma.

Accepted and Agreed:

MEDIMMUNE LIMITED    PHASEBIO PHARMACEUTICALS, INC.

Signed:    Signed:

Name:    Name:

Title:    Title:

Date:    Date:

ALFASIGMA S.P.A.

Signed:     

Name:     

Title:     

Date:     

EXHIBIT D

AZ License Assignment Agreement

This AZ License Assignment Agreement (this “AZ Assignment Agreement”) is dated as of ______, 20__ (the “Assignment Date”), and is entered into by and among (1) MedImmune Limited, a limited liability company formed under the laws of the United Kingdom (“MedImmune”); (2) PhaseBio Pharmaceuticals, Inc., a corporation formed under the laws of the State of Delaware with a principal place of business at 1 Great Valley Parkway, Suite 30, Malvern, Pennsylvania 19355, USA (“PhaseBio”); and (3) Alfasigma S.P.A., a company organized and existing under the laws of Italy, having a place of business at Via Ragazzi del ‘99 n° 5, 1-40133 Bologna, Italy (“Alfasigma”), (collectively the “Parties”).

RECITALS

WHEREAS, PhaseBio and MedImmune are parties to a License Agreement dated November 21, 2017, as amended (the “AZ License”), pursuant to which MedImmune granted to PhaseBio a license under certain intellectual property rights owned or controlled by MedImmune to develop and commercialize Licensed Products in the Field in the Territory in accordance with the terms and conditions set forth in that AZ License;

NOW, THEREFORE, in consideration of the mutual covenants, terms and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1.Assignment. The Parties intend that this AZ Assignment Agreement is a novation and that if the conditions in Section 3(c) of the Acknowledgment of Grant of a Sublicense in Accordance with the License Agreement between MedImmune Limited and PhaseBio Pharmaceuticals, Inc. and Related Options dated June 16, 2021 are met, the AZ License will be assigned and novated from PhaseBio in its entirety to Alfasigma. On the Assignment Date: (a) PhaseBio hereby irrevocably transfers, assigns and novates to Alfasigma, its successors and assigns, all of its rights, title, interest and obligations under, in and to, the AZ License, and (b) PhaseBio shall be relieved from all duties, obligations and liabilities as they pertain to the AZ License, except for any obligations that relate to the period prior to the Assignment Date for which PhaseBio retains sole responsibility, including any financial obligations, and those shall not transferred by this AZ Assignment Agreement to Alfasigma.

2.Assumption. Alfasigma hereby acknowledges to MedImmune that Alfasigma accepts the assignment and novation of the AZ License, including all of the terms and conditions therein, except for any obligations that relate to the period prior to the Assignment Date for which PhaseBio retains sole responsibility, including any financial obligations, and only assumes obligations as they pertain to the AZ License as of the Assignment Date and agrees to be bound by the AZ License in all respects as if Alfasigma had originally executed the same, except for any obligations that relate to the period prior to the Assignment Date that may continue to accrue on PhaseBio which shall not be carried

forward to Alfasigma through this AZ Assignment Agreement. Each reference in the AZ License to PhaseBio shall be deemed to mean Alfasigma as of the Assignment Date. MedImmune agrees to perform the AZ License and be bound by its terms in every way as if Alfasigma were the original party to the AZ License in place of PhaseBio.

3.Consent. The Parties acknowledge and agree that an assignment and novation of the AZ License by PhaseBio to Alfasigma is permissible under Section 10.3 of the AZ License. By its signature below, MedImmune hereby acknowledges and agrees to PhaseBio’s assignment and novation of its rights and obligations under the AZ License to Alfasigma and Alfasigma’s assumption of PhaseBio’s rights and obligations under the AZ License pursuant to and in accordance with this AZ Assignment Agreement.

4.Indemnities. Alfasigma hereby agrees to indemnify, defend and hold harmless PhaseBio against all liabilities, costs, expenses, damages and losses that PhaseBio suffers or incurs under or in connection with the AZ License that first arise on or after the Assignment Date. PhaseBio hereby agrees to indemnify, defend and hold harmless Alfasigma against all liabilities, costs, expenses, damages and losses that Alfasigma suffers or incurs under or in connection with the AZ License that first arose prior to the Assignment Date.

5.General. All capitalized terms used in this AZ Assignment Agreement and not defined herein shall have the same meaning as set forth in the AZ License, as applicable. The provisions of the AZ License governing choice of law, resolution of disputes, and jurisdiction of legal actions are incorporated herein and made a part of this AZ Assignment Agreement. Except as expressly set forth herein, the terms and conditions of the AZ License shall remain unmodified by this AZ Assignment Agreement. This AZ Assignment Agreement constitutes the entire agreement between the Parties pertaining to its subject matter, and supersedes all prior or contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the Parties hereto with respect to such subject matter. No supplement, modification, amendment or waiver of this AZ Assignment Agreement shall be binding unless it refers specifically to this AZ Assignment Agreement and is executed in writing by MedImmune and Alfasigma.

Accepted and Agreed:

MEDIMMUNE LIMITED    PHASEBIO PHARMACEUTICALS, INC.

Signed:    Signed:

Name:    Name:

Title:    Title:

Date:    Date:

ALFASIGMA S.P.A.

Signed:     

Name:     

Title:     

Date:     

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jonathan P. Mow, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of PhaseBio Pharmaceuticals, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 12, 2021	By:	/s/ Jonathan P. Mow
		Jonathan P. Mow Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, John P. Sharp, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of PhaseBio Pharmaceuticals, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

August 12, 2021	By:	/s/ John P. Sharp
		John P. Sharp Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of PhaseBio Pharmaceuticals, Inc. (the “Company”) on Form 10-Q for the period ending June 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

August 12, 2021	By:	/s/ Jonathan P. Mow
		Jonathan P. Mow Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of PhaseBio Pharmaceuticals, Inc. (the “Company”) on Form 10-Q for the period ending June 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

August 12, 2021	By:	/s/ John P. Sharp
		John P. Sharp Chief Financial Officer

XML

Cover - shares	6 Months Ended
	Jun. 30, 2021	Aug. 09, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2021
Document Transition Report	false
Entity File Number	001-38697
Entity Registrant Name	PhaseBio Pharmaceuticals, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	03-0375697
Entity Address, Address Line One	1 Great Valley Parkway
Entity Address, Address Line Two	Suite 30
Entity Address, City or Town	Malvern
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	19355
City Area Code	610
Local Phone Number	981-6500
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	PHAS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		48,042,483
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001169245
Current Fiscal Year End Date	--12-31

XML

CONDENSED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 64,456	$ 28,122
Receivable from sublicense	18,400	0
Prepaid expenses and other assets	5,644	12,027
Total current assets	88,500	40,149
Property and equipment, net	10,379	8,224
Operating lease right-of-use assets	1,701	1,927
Other assets	57	57
Total assets	100,637	50,357
Current liabilities:
Current portion of long-term debt	5,384	5,355
Current portion of deferred sublicense revenue	1,424	0
Accounts payable	2,958	3,674
Accrued expenses and other current liabilities	6,408	5,931
Total current liabilities	16,174	14,960
Long-term debt, net	4,073	6,773
Operating lease liabilities, net	1,306	1,548
Deferred sublicense revenue, net	8,238	0
Development derivative liability	89,329	51,719
Other long-term liabilities	692	559
Total liabilities	119,812	75,559
Commitments and contingencies (Note 9)
Stockholders’ deficit:
Preferred stock, $0.001 par value; 10,000,000 shares authorized; zero shares issued and outstanding at June 30, 2021 and December 31, 2020	0	0
Common stock, $0.001 par value; 200,000,000 shares authorized; 48,057,720 shares issued and 48,027,753 shares outstanding at June 30, 2021; 29,471,854 shares issued and 29,441,887 shares outstanding at December 31, 2020	48	29
Treasury stock, at cost, 29,967 shares as of June 30, 2021 and December 31, 2020	(24)	(24)
Additional paid-in capital	297,561	235,516
Accumulated deficit	(316,760)	(260,723)
Total stockholders’ deficit	(19,175)	(25,202)
Total liabilities and stockholders' deficit	$ 100,637	$ 50,357

XML

CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Preferred stock, par value (in usd per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in usd per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	200,000,000	200,000,000
Common stock, shares issued (in shares)	48,057,720	29,471,854
Common stock, shares outstanding (in shares)	48,027,753	29,441,887
Treasury stock, shares (in shares)	29,967	29,967

XML

CONDENSED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Revenue	$ 10,338	$ 0	$ 10,338	$ 320
Operating expenses:
Research and development	27,366	20,856	49,686	32,305
General and administrative	4,025	3,242	7,352	6,401
Total operating expenses	31,391	24,098	57,038	38,706
Loss from operations	(21,053)	(24,098)	(46,700)	(38,386)
Other income (expense):
Loss from remeasurement of development derivative liability	(5,777)	(3,708)	(7,203)	(4,162)
Interest income	5	21	7	232
Interest expense	(254)	(379)	(539)	(757)
Foreign exchange gain (loss)	0	22	(2)	26
Total other expense	(6,026)	(4,044)	(7,737)	(4,661)
Net loss before income taxes	(27,079)	(28,142)	(54,437)	(43,047)
Provision for income taxes	1,600	0	1,600	0
Net loss	$ (28,679)	$ (28,142)	$ (56,037)	$ (43,047)
Net loss per common share, basic (in usd per share)	$ (0.60)	$ (0.98)	$ (1.41)	$ (1.50)
Net loss per common share, diluted (in usd per share)	$ (0.60)	$ (0.98)	$ (1.41)	$ (1.50)
Weighted average common shares outstanding, basic (in shares)	47,985,871	28,805,238	39,680,408	28,789,256
Weighted average common shares outstanding, diluted (in shares)	47,985,871	28,805,238	39,680,408	28,789,256
Sublicense revenue
Revenue	$ 10,338	$ 0	$ 10,338	$ 0
Grant revenue
Revenue	$ 0	$ 0	$ 0	$ 320

XML

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) $ in Thousands	Total	Common Stock	Treasury Stock	Additional Paid-in Capital	Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2019		28,796,371	(29,967)
Beginning balance at Dec. 31, 2019	$ 59,978	$ 29	$ (24)	$ 222,131	$ (162,158)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock warrants	7,925			7,925
Exercises of stock options (in shares)		14,236
Exercise of stock options	17			17
Stock-based compensation	471			471
Net loss	(14,905)				(14,905)
Ending balance (in shares) at Mar. 31, 2020		28,810,607	(29,967)
Ending balance at Mar. 31, 2020	53,486	$ 29	$ (24)	230,544	(177,063)
Beginning balance (in shares) at Dec. 31, 2019		28,796,371	(29,967)
Beginning balance at Dec. 31, 2019	59,978	$ 29	$ (24)	222,131	(162,158)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(43,047)
Ending balance (in shares) at Jun. 30, 2020		28,891,534	(29,967)
Ending balance at Jun. 30, 2020	26,393	$ 29	$ (24)	231,593	(205,205)
Beginning balance (in shares) at Mar. 31, 2020		28,810,607	(29,967)
Beginning balance at Mar. 31, 2020	53,486	$ 29	$ (24)	230,544	(177,063)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in public offering, net (in shares)		80,523
Issuance of common stock in public offering, net	473			473
Exercises of stock options (in shares)		404
Exercise of stock options	1			1
Stock-based compensation	575			575
Net loss	(28,142)				(28,142)
Ending balance (in shares) at Jun. 30, 2020		28,891,534	(29,967)
Ending balance at Jun. 30, 2020	$ 26,393	$ 29	$ (24)	231,593	(205,205)
Beginning balance (in shares) at Dec. 31, 2020	29,441,887	29,471,854	(29,967)
Beginning balance at Dec. 31, 2020	$ (25,202)	$ 29	$ (24)	235,516	(260,723)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in public offering, net (in shares)		18,400,000
Issuance of common stock in public offering, net	60,084	$ 19		60,065
Exercises of stock options (in shares)		110,146
Exercise of stock options	217			217
Stock-based compensation	670			670
Net loss	(27,358)				(27,358)
Ending balance (in shares) at Mar. 31, 2021		47,982,000	(29,967)
Ending balance at Mar. 31, 2021	$ 8,411	$ 48	$ (24)	296,468	(288,081)
Beginning balance (in shares) at Dec. 31, 2020	29,441,887	29,471,854	(29,967)
Beginning balance at Dec. 31, 2020	$ (25,202)	$ 29	$ (24)	235,516	(260,723)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in public offering, net (in shares)		18,400,000
Net loss	$ (56,037)
Ending balance (in shares) at Jun. 30, 2021	48,027,753	48,057,720	(29,967)
Ending balance at Jun. 30, 2021	$ (19,175)	$ 48	$ (24)	297,561	(316,760)
Beginning balance (in shares) at Mar. 31, 2021		47,982,000	(29,967)
Beginning balance at Mar. 31, 2021	8,411	$ 48	$ (24)	296,468	(288,081)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock in public offering, net	157			157
Exercises of stock options (in shares)		3,615
Exercise of stock options	6			6
Issuance of common stock through employee share purchase plan (in shares)		72,105
Issuance of common stock through employee share purchase plan	202			202
Stock-based compensation	728			728
Net loss	$ (28,679)				(28,679)
Ending balance (in shares) at Jun. 30, 2021	48,027,753	48,057,720	(29,967)
Ending balance at Jun. 30, 2021	$ (19,175)	$ 48	$ (24)	$ 297,561	$ (316,760)

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CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Operating activities
Net loss	$ (56,037)	$ (43,047)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	1,057	111
Stock-based compensation	1,398	1,046
Loss from remeasurement of development derivative liability	7,203	4,162
Non-cash interest expense	173	261
Non-cash research and development expense	23,705	5,735
Other non-cash transactions	0	100
Changes in operating assets and liabilities:
Receivable from sublicense	(18,400)	0
Other receivables	0	1,233
Prepaid expenses and other assets	8,855	(7,107)
Accounts payable	(585)	4,302
Accrued expenses and other current liabilities	1,679	419
Deferred sublicense revenue	9,662	0
Net cash used in operating activities	(21,290)	(32,785)
Investing activities
Purchases of property and equipment	(385)	(1,079)
Acquisition of intellectual property rights	0	(100)
Net cash used in investing activities	(385)	(1,179)
Financing activities
Proceeds from development derivative liability	0	12,649
Proceeds from issuance of common stock in public offering, net	60,351	472
Payments of deferred stock offering costs	(40)	(175)
Proceeds from exercise of stock options	223	18
Issuance of common stock through employee share purchase plan	202	0
Repayments of long-term debt	(2,727)	0
Net cash provided by financing activities	58,009	12,964
Net increase (decrease) in cash and cash equivalents	36,334	(21,000)
Cash and cash equivalents at the beginning of the period	28,122	74,025
Cash and cash equivalents at the end of the period	64,456	53,025
Supplemental disclosure for cash flow
Cash paid for interest	366	496
Supplemental disclosure of non-cash investing and financing activities
Issuance of warrants in conjunction with development derivative liability	0	7,925
Initial recognition of operating lease right-of-use assets and operating lease liabilities	0	564
Purchases of property and equipment by incurring development derivative liability	4,160	0
Purchases of property and equipment included in accounts payable and accrued expenses	$ 44	$ 2,741

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Organization and Description of Business

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Description of Business

Organization and Description of Business

Description of Business

PhaseBio Pharmaceuticals, Inc. (the “Company”) was incorporated as a Delaware corporation on January 10, 2002. The Company is a clinical-stage biopharmaceutical company focused on the development and commercialization of novel therapies for cardiopulmonary diseases. The Company’s lead product candidate, bentracimab (also known as PB2452), is a novel reversal agent for the antiplatelet drug ticagrelor, which the Company is developing for the reversal of the antiplatelet effects of ticagrelor in patients with uncontrolled major or life-threatening bleeding or requiring urgent surgery or an invasive procedure. The Company’s second product candidate, pemziviptadil (also known as PB1046), is in Phase 2 development for the treatment of pulmonary arterial hypertension ("PAH"). Pemziviptadil utilizes the Company’s proprietary half-life extending elastin-like polypeptide technology, which also serves as an engine for the Company’s preclinical pipeline. The Company is also developing its preclinical product candidate, PB6440, for treatment-resistant hypertension.

Liquidity

The Company has experienced net losses and negative cash flows from operations and, as of June 30, 2021, had an accumulated deficit of $316.8 million. The Company expects to continue to incur net losses for at least the next several years. As of June 30, 2021, the Company had cash and cash equivalents of $64.5 million and working capital of $72.3 million. In January 2020, the Company entered into a co-development agreement ("SFJ Agreement") with SFJ Pharmaceuticals X, Ltd., an SFJ Pharmaceuticals Group company ("SFJ"), pursuant to which SFJ provides funding and operational support for the clinical development of bentracimab. Management believes that its existing cash and cash equivalents as of June 30, 2021, in addition to the $12.5 million in clinical trial costs and other expenses that the Company expects SFJ will fund or reimburse pursuant to the SFJ Agreement and the $20.0 million received from Alfasigma S.p.A. ("Alfasigma") in July 2021 pursuant to the Alfasigma Sublicense (as described below), will be sufficient to fund operating expenses and capital requirements through the fourth quarter of 2022.

In July 2021, the Company received a $20.0 million upfront payment upon entering into an exclusive sublicense agreement ("Alfasigma Sublicense") with Alfasigma for the commercialization of any product composed of or containing bentracimab (the "Licensed Products") in the European Union and European Economic Area, as well as the United Kingdom, Russia, Ukraine and certain other countries within the Commonwealth of Independent States, Europe and central Asia (the "Sublicense Territory").

The Company plans to address its future liquidity needs through the pursuit of additional funding through a combination of equity or debt financings, or other third-party financing, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements. However, there is no assurance that these funding efforts will be successful. The Company currently has an effective shelf registration statement on Form S-3 ("2019 Shelf Registration Statement") on file with the Securities and Exchange Commission ("SEC"), which expires in January 2023. The 2019 Shelf Registration Statement currently permits (i) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $200.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination and (ii) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $60.0 million of common stock that may be issued and sold under the "at-the-market" sales agreement with Citigroup Global Markets Inc. and William Blair & Company, L.L.C. (the "ATM Program"). As of June 30, 2021, the Company has sold 561,848 shares of common stock pursuant to the ATM Program for net proceeds of $2.9 million. During the six months ended June 30, 2021, the Company sold 18,400,000 shares of common stock in an underwritten offering pursuant to the 2019 Shelf Registration Statement for net proceeds of $60.2 million, after deducting underwriting discounts and commissions and other offering costs. As of June 30, 2021, the Company had $132.6 million of common stock remaining that can be sold under the 2019 Shelf Registration Statement, of which $57.0 million may be sold under the ATM Program.

The Company is continuing to assess the effect that the COVID-19 pandemic may have on its business and operations. The extent to which COVID-19 may impact the Company's business and operations will depend on future developments that are highly uncertain and cannot be predicted with confidence, such as the geographic distribution of the disease and its variants over time, the efficacy, availability and pace of administration of vaccines and antiviral agents against the disease,

the continued duration of the outbreak, the duration and effect of business disruptions and the short-term effects and ultimate effectiveness of the travel restrictions, quarantines, social distancing requirements and business closures in the United States and other countries to contain and treat the disease. While the potential economic impact brought by, and the continued duration of, the COVID-19 pandemic may be difficult to assess or predict, a continued and growing pandemic could result in significant disruption of global financial markets, reducing the Company's ability to access capital, which could in the future negatively affect its liquidity. In addition, a recession or market correction resulting from the spread of COVID-19 could materially affect the Company's business and the value of its common stock.

Basis of Presentation

The accompanying condensed financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) for interim financial reporting and the rules and regulations of the SEC. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations. All adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the accompanying condensed financial statements have been made. Although these interim condensed financial statements do not include all of the information and footnotes required for complete annual financial statements, management believes the disclosures are adequate to make the information presented not misleading. The unaudited interim results of operations and cash flows for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the full year. The unaudited interim condensed financial statements and footnotes should be read in conjunction with the audited financial statements and footnotes for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 15, 2021, wherein a more complete discussion of significant accounting policies and certain other information can be found.

Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”).

The Company manages its operations as a single reportable segment for the purposes of assessing performance and making operating decisions.

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Significant Accounting Policies

6 Months Ended

Jun. 30, 2021

Accounting Policies [Abstract]

Significant Accounting Policies

Significant Accounting Policies

Use of Estimates

The preparation of the Company’s condensed financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s condensed financial statements and accompanying notes. The most significant estimates in the Company’s condensed financial statements relate to the valuation of the development derivative liability, the deferral and recognition of revenue under the Alfasigma Sublicense and the clinical trial accruals. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results could differ materially from those estimates and assumptions.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents. The Company maintains certain deposit accounts and money market funds in federally insured financial institutions in excess of federally insured limits. The Company could experience losses on the money market funds in the future.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity from the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents include cash in readily available checking and money market accounts.

Receivable from Sublicense

Receivable from sublicense relates to amounts due from Alfasigma under the Alfasigma Sublicense. The Company records amounts as accounts receivable when the right to consideration is deemed unconditional.

Fair Value of Financial Instruments

The carrying amounts of other receivables, prepaid expenses and other assets, accounts payable and accrued expenses and other current liabilities are reasonable estimates of their fair value because of the short maturity of these items. Based on the borrowing rates currently available to the Company for loans with similar terms, the Company believes the fair values of the term loan and operating lease liabilities and corresponding right-of-use assets approximate their respective carrying values.

Deferred Sublicense Revenue

When consideration is received, or such consideration is unconditionally due, from a customer prior to the Company completing its performance obligation to the customer under the terms of a contract, a contract liability is recorded as deferred revenue. Deferred revenues expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current liabilities. Deferred revenues not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as long-term liabilities.

Development Derivative Liability

Development derivative liability is recorded based on the present value of the estimated consideration to be received and the estimated consideration to be paid pursuant to contractual terms of the SFJ Agreement, which was determined to have been fair value. The liability is remeasured quarterly, as a Level 3 derivative, with any change in fair value recorded in the form of a gain (loss) from remeasurement of development derivative liability on the condensed statements of operations.

Property and Equipment

Property and equipment are recorded at cost and depreciated over the estimated useful lives of the assets (three to five years) using the straight-line method. Leasehold improvements are amortized over the shorter of their estimated useful lives or the lease term.

Leases

At lease commencement, the Company records a lease liability based on the present value of lease payments over the expected lease term including any options to extend the lease that the Company is reasonably certain to exercise. The Company calculates the present value of lease payments using an incremental borrowing rate as the Company’s leases do not provide an implicit interest rate. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. At the lease commencement date, the Company records a corresponding right-of-use lease asset based on the lease liability, adjusted for any lease incentives received and any initial direct costs paid to the lessor prior to the lease commencement date. The Company may enter into leases with an initial term of 12 months or less (“Short-Term Leases”). For any Short-Term Leases, the Company records the rent expense on a straight-line basis and does not record the leases on the condensed balance sheet. The Company had no Short-Term Leases as of June 30, 2021 or December 31, 2020.

After lease commencement, the Company measures its leases as follows: (i) the lease liability based on the present value of the remaining lease payments using the discount rate determined at lease commencement and (ii) the right-of-use lease asset based on the remeasured lease liability, adjusted for any unamortized lease incentives received, any unamortized initial direct costs and the cumulative difference between rent expense and amounts paid under the lease agreement. Any lease incentives received and any initial direct costs are amortized on a straight-line basis over the expected lease term. Rent expense is recorded on a straight-line basis over the expected lease term.

Long-Lived Assets

The Company regularly reviews the carrying value and estimated lives of all of its long-lived assets, including property and equipment and right-of-use assets to determine whether indicators of impairment may exist which warrant adjustments to carrying values or estimated useful lives. The determinants used for this evaluation include management’s estimate of the asset’s ability to generate net positive cash flow in future periods as well as the strategic significance of the assets to the Company’s business objectives. Should an impairment exist, the impairment loss would be measured based on the extent that the estimated fair value is less than its carrying value. The Company did not recognize any impairment losses in either the six months ended June 30, 2021 or the year ended December 31, 2020.

Preclinical and Clinical Trial Accruals

The Company accrues and expenses amounts incurred in connection with preclinical studies and clinical trial activities performed by third parties based upon estimates of the proportion of work completed over the life of the individual trial and subject enrollment rates in accordance with agreements with clinical research organizations, contract manufacturing organizations and clinical trial sites. The Company determines the estimates by reviewing contracts, vendor agreements and purchase orders, and through discussions with internal clinical personnel and external service providers as to the progress or stage of completion of trials or services and the agreed-upon fee to be paid for such services. However, actual costs and timing of clinical trials are highly uncertain, subject to risks and may change depending upon a number of factors, including the Company’s clinical development plan.

Management makes estimates of the Company’s accrued expenses as of each balance sheet date in the Company’s condensed financial statements based on facts and circumstances known to the Company at that time. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Nonrefundable advance payments for goods and services, including fees for process development or manufacturing and distribution of clinical supplies that will be used in future research and development activities, are deferred and recognized as expense in the period that the related goods are consumed or services are performed.

Revenue Recognition

Sublicense Revenue

Sublicensing arrangements may contain multiple components, which may include (i) sublicenses; (ii) research and development activities; and (iii) the manufacturing and supply of certain materials. Payments pursuant to these arrangements may include non-refundable payments, upfront payments, milestone payments upon the achievement of significant regulatory and development events or sales of product at certain agreed-upon amounts, sales milestones and royalties on product sales. The amount of variable consideration is constrained until it is probable that the revenue is not at a significant risk of reversal in a future period.

In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under a sublicense agreement, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are capable of being distinct; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue as the Company satisfies each performance obligation.

The Company must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation, which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as forecasted revenues and costs, development timelines, discount rates and probabilities of regulatory and commercial success. The Company also applies significant judgment when evaluating whether contractual obligations represent distinct performance obligations, allocating transaction price to performance obligations within a contract, determining when performance obligations have been met, assessing the recognition and future reversal of variable consideration and determining and applying appropriate methods of measuring progress for performance obligations satisfied over time.

Grant Revenue

Grant revenue is derived from government grants that support the Company’s efforts on specific research projects. The Company has determined that the government agencies providing grants to the Company are not customers. The Company recognizes grant revenue when there is reasonable assurance of compliance with the conditions of the grant and reasonable assurance that the grant revenue will be received.

Research and Development Expense

Research and development costs are expensed as incurred. Costs incurred in obtaining technology licenses are charged to research and development expense if the technology has no alternative future use.

Stock-Based Compensation

The Company measures and recognizes compensation expense for all stock-based compensation based on the estimated fair value at the date of grant. Currently, the Company’s stock-based awards consist only of stock options; however, future grants under the Company’s equity compensation plan may also consist of shares of restricted stock, restricted stock units, stock appreciation rights, performance awards and performance units. The Company also maintains the 2018 Employee Stock Purchase Plan ("ESPP") under which it may issue shares of common stock. The Company estimates the fair value of stock options and shares that will be issued under the ESPP using the Black-Scholes option-pricing model, which requires the use of estimates. The Company recognizes stock-based compensation cost for ratably vesting stock options and for shares that it will issue under the ESPP on a straight-line basis over the requisite service period of the award and records forfeitures in the period in which they occur.

The Black-Scholes option-pricing model requires the input of subjective assumptions, including the risk-free interest rate, the expected dividend yield of the Company’s common stock, the expected volatility of the price of the Company’s common stock, and the expected term of the option. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, the Company’s stock-based compensation expense could be materially different in the future. 

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the condensed financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the condensed financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If management determines that the Company would be able to realize its deferred tax assets in the future in excess of their net recorded amount, management would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

The Company records uncertain tax positions on the basis of a two-step process whereby (1) management determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, management recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits, if any, within income tax expense, and any accrued interest and penalties are included within the related tax liability line.

Net Loss Per Share

Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included when their effect is dilutive. The Company’s potentially dilutive securities, which include outstanding options under the Company's stock option plan, warrants issued from time to time and shares of common stock to be potentially issued under the ESPP, have been excluded from the computation of diluted net loss per share as they would be anti-dilutive. For all periods presented, there is no difference in the number of shares used to compute basic and diluted shares outstanding due to the Company’s net loss position.

The following table sets forth the outstanding, potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive:

	As of June 30,
	2021	2020
Common stock options	4,359,395	3,740,815
Warrants to purchase common stock	2,349,595	2,349,595
Employee stock purchase plan	275,077	271,012
Total	6,984,067	6,361,422

Recent Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which among other things, eliminates certain exceptions in the current rules regarding the approach for intraperiod tax allocations and the methodology for calculating income taxes in an interim period, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The standard became effective for the Company in the first quarter of 2021. Adoption of this new standard did not have a material impact on the Company's condensed financial statements and related disclosures.

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Fair Value Measurement

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurement

Fair Value Measurement

Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability.

The Company classifies fair value measurements in one of the following three categories for disclosure purposes:

Level 1:    Quoted prices in active markets for identical assets or liabilities.

Level 2:    Inputs other than Level 1 prices for similar assets or liabilities that are directly or indirectly observable in the marketplace.

Level 3:    Unobservable inputs that are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

The Company’s cash equivalents are classified using Level 1 inputs within the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. None of the Company’s non-financial assets or liabilities are recorded at fair value on a non-recurring basis. No transfers between levels have occurred during the periods presented.

The fair value of the Company's financial commitment to SFJ in conjunction with the SFJ Agreement is presented as a development derivative liability based on Level 3 inputs.

The following table summarizes the Company’s assets and liabilities that require fair value measurements on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):

	Total		Fair Value Measurements at Reporting Date
			Level 1		Level 2		Level 3
As of June 30, 2021:
Assets
Cash equivalents	$	64,236	$	64,236	$	—	$	—
Liabilities
Development derivative liability (Note 8)	$	89,329	$	—	$	—	$	89,329
As of December 31, 2020:
Assets
Cash equivalents	$	27,872	$	27,872	$	—	$	—
Liabilities
Development derivative liability (Note 8)	$	51,719	$	—	$	—	$	51,719

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Property and Equipment

6 Months Ended

Jun. 30, 2021

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and Equipment

The following table presents the composition of property and equipment, net as of June 30, 2021 and December 31, 2020 (in thousands):

	As of June 30, 2021		As of December 31, 2020
Lab equipment	$	12,244	$	8,994
Computer hardware, software and telephone	140		140
Furniture and fixtures	114		107
Leasehold improvements	77		67
Construction in progress	986		1,042
	13,561		10,350
Less accumulated depreciation	(3,182)		(2,126)
Property and equipment, net	$	10,379	$	8,224

Depreciation expense was $0.6 million and $0.1 million for the three months ended June 30, 2021 and 2020, respectively, and $1.1 million and $0.1 million for the six months ended June 30, 2021 and 2020, respectively.

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Accrued Expenses and Other Current Liabilities

6 Months Ended

Jun. 30, 2021

Payables and Accruals [Abstract]

Accrued Expenses and Other Current Liabilities

Accrued Expenses and Other Current LiabilitiesThe following table presents the composition of accrued expenses and other current liabilities as of June 30, 2021 and December 31, 2020 (in thousands):

	As of June 30, 2021		As of December 31, 2020
Accrued clinical and related costs	$	3,921	$	2,753
Accrued compensation and related costs	1,483		2,260
Accrued interest	52		69
Current portion of operating lease liability	476		459
Accrued other	476		390
Accrued expenses and other current liabilities	$	6,408	$	5,931

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Deferred Sublicense Revenue

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Deferred Sublicense Revenue

Deferred Sublicense Revenue

In June 2021, the Company entered into the Alfasigma Sublicense with Alfasigma, under which the Company granted to Alfasigma exclusive rights to develop, use, sell, have sold, offer for sale and import the Licensed Products in the Sublicense Territory. Under the terms of the Alfasigma Sublicense, the Company received a $20.0 million upfront payment from Alfasigma in July 2021 and will be eligible to receive up to $35.0 million upon the achievement of certain pre-revenue regulatory milestones, up to $190.0 million upon the achievement of certain commercial milestones and tiered royalty payments based on net sales, with percentages starting in the low double digits and escalating up to the mid-twenties. Also, as part of the overall arrangement, the Company has agreed to supply the Licensed Products to Alfasigma at the lower of cost or a price not to exceed certain agreed amounts.

Under the Alfasigma Sublicense, the Company is responsible for developing the Licensed Products and securing regulatory approval with the European Medicines Agency (the “EMA”), and the Medicines and Healthcare products Regulatory Agency (the “MHRA”), including in accordance with the SFJ Agreement, after which any marketing authorizations will be assigned to Alfasigma. Alfasigma is obligated to obtain and maintain any regulatory approvals necessary to market and sell the Licensed Products (including pricing approvals and post-marketing commitments) and is also responsible for securing regulatory approval in the countries within the Sublicense Territory outside of the European Union and the United Kingdom.

The Company first assessed the Alfasigma Sublicense under ASC 808, Collaborative Arrangements (“ASC 808”) to determine whether the Alfasigma Sublicense or units of accounts within the Alfasigma Sublicense represent a collaborative arrangement based on the risks and rewards and activities of the parties. The Company concluded that Alfasigma represented a customer and applied relevant guidance from ASC 606, Revenue from Contracts with Customers (“ASC 606”) to evaluate the appropriate accounting under the Alfasigma Sublicense. In accordance with this guidance, the Company identified the following commitments under the arrangement: (i) exclusive sublicense rights to develop, use, sell, have sold, offer for sale and import Licensed Products (the “License”); (ii) development and regulatory activities (“Development and Regulatory Activities”); and (iii) the requirement to supply Alfasigma with the Licensed Product at the lower of cost or a price not to exceed certain agreed amounts (the “Supply of Licensed Product”). The Company determined that these three commitments represent distinct performance obligations for purposes of recognizing revenue and will recognize revenue as it fulfills these performance obligations.

The Company determined that the upfront payment of $20.0 million constitutes the transaction price as of the outset of the Alfasigma Sublicense. Future potential regulatory and development milestone payments were fully constrained as the risk of significant revenue reversal related to these amounts has not yet been resolved. The achievement of the future potential milestones is not within the Company’s control and is subject to certain research and development success or regulatory approvals and therefore carry significant uncertainty. The Company will reevaluate the likelihood of achieving these milestones at the end of each reporting period and adjust the transaction price in the period the risk is resolved. In addition, the Company will recognize any consideration related to sales-based milestones and royalties when the subsequent sales occur since those payments relate primarily to the License, which was delivered by the Company to Alfasigma upon entering into the Alfasigma Sublicense.

The transaction price was allocated to the three performance obligations based on the estimated stand-alone selling prices at contract inception. The stand-alone selling price of the License was based on a discounted cash flow approach and considered several factors including, but not limited to, discount rate, development timeline, regulatory risks, estimated market demand and future revenue potential using an adjusted market approach. The stand-alone selling price of the Development and Regulatory Activities and the Supply of Licensed Product was estimated using the expected cost-plus margin approach. The Company allocated the upfront portion of the transaction price to the performance obligations as of June 30, 2021 as follows (in thousands):

	Transaction Price		Cumulative Sublicense Revenue Recognized		Deferred Sublicense Revenue
License	$	10,223	$	10,223	$	—
Development and Regulatory Services	2,647		115		2,532
Supply of License Product	7,130		—		7,130
	$	20,000	$	10,338	9,662
Less current portion of long-term deferred sublicense revenue					(1,424)
Total long-term deferred sublicense revenue					$	8,238

The Company reevaluates the transaction price and the total estimated costs expected to be incurred to satisfy the performance obligations and adjusts the deferred sublicense revenue at the end of each reporting period. Such changes will result in a change to the amount of sublicense revenue recognized and deferred sublicense revenue.

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Debt

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Debt

Debt

March 2019 Loan Agreement with Silicon Valley Bank and WestRiver Innovation Lending Fund VIII, L.P.

In March 2019, the Company entered into a loan (the "2019 Loan") with SVB and WestRiver Innovation Lending Fund VIII, L.P. (“WestRiver”), pursuant to which the Company could borrow up to $15.0 million, issuable in three separate tranches (“Advances”), of $7.5 million (“Tranche 1”), which was issued upon execution of the 2019 Loan, $2.5 million, which was issued in May 2019 (“Tranche 2”) and $5.0 million, which was issued in October 2019 (“Tranche 3”), which the Company was required to draw upon the achievement of certain regulatory milestones (the “Tranche 3 Milestones”).

The maturity date of the 2019 Loan is March 1, 2023. Under the terms of the 2019 Loan, the Company made interest-only payments through June 30, 2020 with respect to Tranche 1, Tranche 2 and Tranche 3 at a rate equal to the greater of the Prime Rate plus 1.00%, as defined in the 2019 Loan, or 6.5%, followed by an amortization period of 33 months of equal monthly payments of principal plus interest until paid in full. In addition to and not in substitution for the Company’s regular monthly payments of principal plus accrued interest, the Company is required to make a final payment equal to 6% of the aggregate principal amount of the advances (“Final Payment”) on the maturity date.

Upon execution of the 2019 Loan and the draw of Tranche 1, the Company issued to SVB and WestRiver warrants to purchase an aggregate of 37,606 shares of common stock with an exercise price of $4.73 per share. In May 2019, upon the draw of Tranche 2, the Company issued to SVB and WestRiver warrants to purchase an aggregate of 12,130 shares of common stock with an exercise price of $10.86 per share. In October 2019, upon the draw of Tranche 3, the Company issued to SVB and WestRiver warrants to purchase an aggregate of 24,262 shares of common stock with an exercise price of $3.88 per share. All warrants are immediately exercisable and expire ten years from the date of issuance.

Upon execution of the 2019 Loan, the Company drew $7.5 million from Tranche 1 and repaid the outstanding principal balance and the accrued portion of the Final Payment of the SVB Loan.

The Company’s obligations under the 2019 Loan are secured by a first-priority security interest in substantially all of the Company’s current and future assets. The Company is also obligated to comply with various other customary covenants, including restrictions on the Company’s ability to encumber its intellectual property assets. The Company was in compliance with all covenants under the 2019 Loan as of December 31, 2020.

The Company recorded a debt discount of $0.4 million for the estimated fair value of warrants and debt issuance costs upon the borrowings of Tranches 1, 2 and 3. The balance of the Final Payment liability was $0.7 million as of June 30, 2021 and is included in other long-term liabilities on the condensed balance sheet. The debt discount and Final Payment liability are being amortized to interest expense over the term of the 2019 Loan using the effective-interest method. Interest expense, including amortization of the debt discount related to the term debt and the Final Payment liability, totaled $0.3 million and $0.4 million for the three months ended June 30, 2021 and 2020, respectively, and $0.5 million and $0.8 million for the six months ended June 30, 2021 and 2020, respectively.

The following table sets forth by year the Company’s required future principal payments as of June 30, 2021 (in thousands):

Years Ending December 31,
2021 (remaining six months)	$	2,727
2022	5,455
2023	1,363
Thereafter	—
Total principal payments	9,545
Less unamortized loan fees	(88)
Total term loan borrowings	$	9,457

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Development Derivative Liability

6 Months Ended

Jun. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Development Derivative Liability

Development Derivative Liability

In January 2020, the Company entered into the SFJ Agreement, pursuant to which SFJ has agreed to provide up to $120.0 million in funding and project management services in connection with the REVERSE-IT trial, a global Phase 3 clinical trial of bentracimab. During the term of the SFJ Agreement, the Company will have primary responsibility for clinical development and regulatory activities for bentracimab in the United States and the European Union, while SFJ will have primary responsibility for clinical development and regulatory activities for bentracimab in China and Japan and will provide clinical trials operational support in the European Union.

From the inception of the SFJ Agreement through June 30, 2021, SFJ has provided funding and paid for amounts on the Company's behalf in the aggregate amount of $77.5 million under the SFJ Agreement. In addition, the Company expects that SFJ will fund or reimburse an additional $12.5 million of clinical trial costs and other expenses. SFJ will also provide up to an additional $30.0 million upon the achievement of specified milestones with respect to the Company's clinical development of bentracimab.

If the United States Food and Drug Administration ("FDA") approves a Biologics License Application for bentracimab, the Company has agreed to pay to SFJ an initial payment of $5.0 million and an additional $325.0 million in the aggregate in seven additional annual payments (the “U.S. Approval Payments”). If the EMA or the national regulatory authorities in certain European countries provide marketing approval of bentracimab, the Company will pay SFJ an initial payment of $5.0 million and an additional $205.0 million in the aggregate in seven additional annual payments (the “EU Approval Payments”). The majority of the U.S. Approval Payments and the EU Approval Payments will be made from the third anniversary to the seventh anniversary of marketing approval in the applicable jurisdiction. If either the Pharmaceuticals and Medical Devices Agency (the “PMDA”) of Japan or the National Medical Products Administration (the “NMPA”) of China provides marketing approval of bentracimab, the Company will pay SFJ an initial payment of $1.0 million and then an additional $59.0 million in the aggregate in eight additional annual payments (the “Japan/China Approval Payments”), with the majority of the payments to be made from the fifth anniversary to the eighth anniversary of marketing approval. The Japan/China Approval Payments will only be paid once regardless of receipt of marketing approval in both Japan and China. The U.S. Approval Payments, EU Approval Payments and Japan/China Approval Payments will be proportionately adjusted in the event that the actual funding from SFJ is lower or greater than $120.0 million. The Company will not be obligated to make the U.S. Approval Payments if it does not receive marketing approval for bentracimab from the FDA, the EU Approval Payments if it does not receive marketing approval for bentracimab from the EMA or the national regulatory authority in certain European countries or the Japan/China Approval Payments if it does not receive marketing approval for bentracimab from either the PMDA or the NMPA.

Upon execution of the SFJ Agreement, the Company issued to SFJ a warrant to purchase an aggregate of 2,200,000 shares of common stock at an exercise price of $6.50 per share with a contractual term of ten years. The warrant is exercisable in two tranches: Tranche A and Tranche B. Tranche A represents 1,100,000 shares that are immediately exercisable by SFJ. Tranche B represents 1,100,000 shares that are exercisable at the earlier of (i) the achievement of certain development milestones or (ii) the consummation of an Acquisition, as defined in the SFJ Agreement. The warrants are equity-classified and were valued at $7.9 million at issuance using a probability adjusted Black-Scholes valuation technique.

The Company accounts for the SFJ Agreement as a derivative instrument that increases and decreases as consideration is received and repayments are made, respectively. The derivative is further adjusted at each reporting period to its estimated fair value. At June 30, 2021, the derivative is presented as a liability in the Company's condensed balance sheet. Any

changes in fair value are recorded within the Company's condensed statements of operations. The liability was initially recorded at a value of $2.1 million, which incorporates the $10.0 million upfront payment from SFJ and the issuance of the Company's common stock warrants to SFJ. During the six months ended June 30, 2021, SFJ provided additional funding and paid for amounts on the Company's behalf in the aggregate amount of $30.4 million, and the development derivative liability was subsequently remeasured at June 30, 2021, as a Level 3 derivative. The change in fair value was $5.8 million and $3.7 million for the three months ended June 30, 2021 and 2020, respectively, and $7.2 million and $4.2 million for the six months ended June 30, 2021 and 2020, respectively.

The development derivative liability is valued using a scenario-based discounted cash flow method, whereby each scenario makes assumptions about the probability and timing of cash flows, and such cash flows are present valued using a risk-adjusted discount rate. The valuation method incorporates certain unobservable Level 3 key inputs including (i) the probability and timing of funding, (ii) the probability and timing of achieving regulatory approvals, (iii) the Company's cost of borrowing (16.00% plus the risk free borrowing rate) and (iv) SFJ's cost of borrowing (2.50% plus the risk free borrowing rate).

The following table presents activity for the development derivative liability during the six months ended June 30, 2021 (in thousands):

	Development Derivative Liability
Balance at December 31, 2020	$	51,719
Funding during the period	30,407
Change in fair value	7,203
Balance at June 30, 2021	$	89,329

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Legal Proceedings

The Company is not currently a party to any litigation, nor is management aware of any pending or threatened litigation against the Company, that it believes would materially affect the Company’s business, operating results, financial condition or cash flows.

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Leases

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

Leases

Leases

The Company leases office and research and development facilities and equipment under various non-cancellable operating lease agreements.

In January 2010, the Company entered into a lease for office and laboratory space in Malvern, Pennsylvania (the “Malvern Lease”). The Malvern Lease commenced in March 2010 and was amended to extend its term to July 2018 and again to September 2023, with an option to extend the lease for an additional three years. This lease contains escalating rent payments. In December 2018, the Company entered into a lease for office space in San Diego, California, which expires in October 2022. In June 2020, the Company entered into a lease for additional office space in Malvern, Pennsylvania, which expires in September 2023. As of June 30, 2021, the weighted average remaining lease term for the Company’s leases was 4.2 years, and the weighted average discount rate used to determine the right-of-use assets and corresponding operating lease liabilities was 5.8%.

Maturities of operating lease liabilities as of June 30, 2021 are as follows (in thousands):

Year Ending December 31,
2021 (remaining six months)	$	283
2022	555
2023	419
2024	279
2025	283
Thereafter	215
Total future minimum lease payments	2,034
Less: Present value adjustment	(252)
Operating lease liabilities	$	1,782

The Company recognizes rent expense for the operating leases on a straight-line basis. Rent expense was $0.2 million and $0.1 million for the three months ended June 30, 2021 and 2020, respectively, and $0.4 million and $0.2 million for the six months ended June 30, 2021 and 2020, respectively.

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Stockholders’ Equity

6 Months Ended

Jun. 30, 2021

Stockholders' Equity Note [Abstract]

Stockholders’ Equity

Stockholders’ Equity

Shelf Registration Statement

In December 2019, the Company filed the 2019 Shelf Registration Statement on Form S-3, which became effective in January 2020. The 2019 Shelf Registration Statement, which expires in January 2023, permits: (i) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $200.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination; and (ii) the offering, issuance and sale by the Company of up to a maximum aggregate offering price of $60.0 million of the Company's common stock that may be issued and sold in "at-the-market" sales under the ATM Program. As of June 30, 2021, the Company has $132.6 million of common stock remaining that can be sold under the 2019 Shelf Registration Statement, of which $57.0 million may be sold under the ATM Program.

Shares Sold Under the ATM Program

As of June 30, 2021, the Company has sold 561,848 shares of common stock pursuant to the ATM Program for gross proceeds of $2.9 million.

March 2021 Offering

In March 2021, pursuant to the 2019 Shelf Registration Statement, the Company completed an underwritten public offering of its common stock, which resulted in the issuance and sale of an aggregate of 18,400,000 shares of common stock at a public offering price of $3.50 per share, generating net proceeds of $60.2 million, after deducting underwriting discounts and commissions and other offering costs.

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Stock-Based Compensation

6 Months Ended

Jun. 30, 2021

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock-Based CompensationStock-based compensation expense has been reported in the Company’s condensed statements of operations for the three and six months ended June 30, 2021 and 2020 as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
General and administrative	$	510	$	402	$	984	$	742
Research and development	219		173		414		304
Total stock-based compensation	$	729	$	575	$	1,398	$	1,046

As of June 30, 2021, the total unrecognized compensation expense related to unvested employee and non-employee stock options was $5.6 million, which is expected to be recognized over a weighted-average period of approximately 2.5 years.

In October 2018, the Company's board of directors and stockholders approved the ESPP, which became effective on October 17, 2018. The ESPP is intended to qualify as an "employee stock purchase plan" within the meaning of Section 423 of the Internal Revenue Code.

Under the ESPP, eligible employees are granted rights to purchase shares of common stock, which are funded through payroll deductions that cannot exceed 15% of each employee’s compensation. The ESPP generally provides for a 24-month offering period, which includes four six-month purchase periods. At the end of each purchase period, eligible employees are permitted to purchase shares of common stock at 85% of the lower of fair market value at the beginning of the offering period or fair market value at the end of the purchase period. The ESPP is considered a compensatory plan, and the Company recorded stock-based compensation expense of $0.1 million and $21,000 for the three months ended June 30, 2021 and 2020, respectively, and $0.1 million and $21,000 for the six months ended June 30, 2021 and 2020, respectively. The Company issued 72,105 and zero shares of common stock under the ESPP for the six months ended June 30, 2021 and 2020, respectively.

As of June 30, 2021, the total unrecognized compensation expense related to the ESPP was $0.2 million, which is expected to be recognized over a weighted-average period of approximately 0.8 years.

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Licenses and Other Agreements

6 Months Ended

Jun. 30, 2021

License Agreements [Abstract]

Licenses and Other Agreements

License and Other Agreements

MedImmune Limited License Agreement

In November 2017, the Company entered into a license agreement (“MedImmune License”) with MedImmune Limited (“MedImmune”). MedImmune is a wholly-owned subsidiary of AstraZeneca plc (“AstraZeneca”). Pursuant to the terms of the MedImmune License, MedImmune granted the Company exclusive global rights for the purpose of developing and commercializing products under the MedImmune License (“MedImmune licensed product”). The Company has made contingent milestone payments of $3.0 million and is obligated to make remaining contingent milestone payments totaling up to an aggregate of $15.0 million upon the achievement of clinical development and regulatory milestones. In addition, the Company will pay MedImmune tiered royalties ranging from mid-single-digit to low-teen percentages of net sales of any MedImmune licensed products and additional payments of up to $50.0 million in aggregate commercial milestones. The Company incurred no royalty costs under the MedImmune License in the three and six months ended June 30, 2021 and 2020.

The Company also must pay quarterly fees relating to technical services provided by MedImmune. The MedImmune License requires the Company to cooperate with MedImmune on commercial messaging of bentracimab and provides MedImmune with the return of rights to bentracimab if certain commercial diligence requirements are not achieved by the Company. In addition, the MedImmune License offers an option for third-party product storage costs. The Company incurred no third-party product storage costs in the three and six months ended June 30, 2021 and 2020. AstraZeneca is a stockholder of the Company.

Duke License Agreement

In October 2006, the Company entered into a license agreement with Duke University (“Duke”) (as amended, the “Duke License”). Pursuant to the Duke License, Duke granted to the Company an exclusive, worldwide license under certain patent rights and a non-exclusive license to know-how owned or controlled by Duke to develop and commercialize any products or processes covered under the Duke License (the “Duke licensed products”). The Duke License was amended in February 2016 to allow Duke to use the Company’s technology in the area of small-molecule oncologics. The Duke License is a worldwide, sublicensable agreement and remains in full effect for the life of the last-to-expire patents included in the patent rights, which is estimated to be 2030. The Company is required to apply for, prosecute and maintain all United States and foreign patent rights under the Duke License.

The Company is obligated to pay up to $2.2 million upon the achievement of clinical development and regulatory milestones and up to $0.4 million upon the achievement of commercial milestones. The Duke License may be terminated by Duke if the Company fails to meet certain clinical development and regulatory milestones within specified timeframes. As of June 30, 2021, the Company was in compliance with its development obligations.

The Company is required to use commercially reasonable efforts to develop one or more products or processes and introduce them into commercial markets. Duke will receive low single-digit royalty percentages on net sales of Duke licensed products by the Company or its sublicensee, with minimum aggregate royalties of $0.2 million payable following the Company’s achievement of certain commercial milestones. No sales of Duke licensed products or services have occurred since the effective date through June 30, 2021.

Certain alliance fee payments up to the greater of $0.3 million or a low double-digit percentage of the fees the Company receives from a third party in consideration of forming a strategic alliance may be required depending upon how the patent rights are commercialized. The Company must pay Duke the first $1.0 million of non-royalty payments it receives from a sublicensee, and thereafter a specified percentage of any additional non-royalty payments it receives, subject to certain conditions. If Duke receives revenue as a result of a license or sublicense to a third party in the field of small-molecule oncologics, it will pay the Company a specified percentage of the amount of such revenue in excess of $1.0 million. The Company incurred no costs under the Duke License in the three and six months ended June 30, 2021 and 2020.

Alfasigma Sublicense

In June 2021, the Company entered into the Alfasigma Sublicense with Alfasigma under which the Company granted to Alfasigma exclusive rights to develop, use, sell, have sold, offer for sale and import the Licensed Products in the Sublicense Territory. Under the terms of the Alfasigma Sublicense, in July 2021, the Company received a $20.0 million upfront payment from Alfasigma and will be eligible to receive up to $35.0 million upon the achievement of certain pre-revenue regulatory milestones, up to $190.0 million upon the achievement of certain commercial milestones and tiered royalty payments on net sales, with percentages starting in the low double digits and escalating up to the mid-twenties.

With respect to the up to $35.0 million of regulatory milestone payments: (i) $10.0 million is payable following acceptance by the EMA of the filing of the first drug approval application for a Licensed Product; (ii) $12.5 million is payable following achievement of conditional regulatory approval from the EMA; and (iii) the remaining $12.5 million is payable following achievement of unconditional regulatory approval from the EMA allowing for prescribing of a Licensed Product for the reversal of the antiplatelet effects of ticagrelor in both (a) patients with uncontrolled major or life-threatening bleeding and (b) patients requiring urgent surgery or an invasive procedure.

Under the Alfasigma Sublicense, the Company is responsible for developing the Licensed Products and securing regulatory approval with the EMA and the MHRA, including in accordance with the SFJ Agreement, after which any marketing authorizations will be assigned to Alfasigma. Alfasigma is obligated to obtain and maintain any regulatory approvals necessary to market and sell the Licensed Products (including pricing approvals and post-marketing commitments) and is also responsible for securing regulatory approval in countries outside of Europe and the United Kingdom. Alfasigma will purchase its requirements from the Company for a set period, after which the Company is obligated to supply a lesser amount of Alfasigma's requirements, for Licensed Product at the lower of cost or a price not to exceed certain agreed amounts.

Unless earlier terminated, the Alfasigma Sublicense automatically expires, with respect to each Licensed Product and each country in the Sublicense Territory, on the latest of (1) the tenth anniversary of the first commercial sale of such Licensed Product in such country, (2) the expiration of the last out-licensed patent of such Licensed Product in such country and (3) the expiration of regulatory exclusivity, if any, of such Licensed Product in such country.

In connection with the Alfasigma Sublicense, the Company and Alfasigma also entered into an Acknowledgement of Grant of Sublicense with MedImmune (the “Acknowledgement of Grant”), which provides for, among other things, (i) a potential assignment of the Alfasigma Sublicense from the Company to MedImmune or (ii) a potential assignment of the Medimmune License from the Company to Alfasigma, in either case in the event that the Company breaches certain obligations under the Medimmune License that are not cured or remedied and SFJ has grounds to execute a “Program Transfer” (as defined in the SFJ Agreement) but elects not to do so.

Wacker License Agreement

In April 2019, the Company entered into a license agreement (“Wacker License Agreement”), with Wacker Biotech GmbH (“Wacker”), pursuant to which Wacker granted the Company an exclusive license under certain of Wacker’s intellectual property rights to use Wacker’s proprietary E. coli strain for the manufacture of bentracimab worldwide outside of specified Asian countries, and to commercialize bentracimab, if approved, manufactured by the Company or on the Company’s behalf using Wacker’s proprietary E. coli strain throughout the world. The Company has the right to grant sublicenses under the license, subject to certain conditions as specified in the Wacker License Agreement. Under the terms of the agreement, the Company is required to pay a fixed, nominal per-unit royalty, which is subject to adjustment, and an annual license fee in a fixed Euro amount in the low to mid six digits. The agreement will be in force for an indefinite period of time, and upon the expiration of the Company’s royalty obligations, the license will be considered fully paid and will convert to a non-exclusive license. Either party may terminate the Wacker License Agreement for breach if such breach is not cured within a specified number of days. The Company incurred $0.1 million and $0.1 million under the Wacker License Agreement for the three months ended June 30, 2021 and 2020, respectively, and $0.2 million and $0.2 million for the six months ended June 30, 2021 and 2020, respectively.

Viamet Asset Purchase Agreement

In January 2020, the Company entered into a purchase agreement ("PB6440 Agreement") with Viamet Pharmaceuticals Holdings, LLC and its wholly-owned subsidiary, Selenity Therapeutics (Bermuda), Ltd. (the "Sellers"), pursuant to which the Company acquired all of the assets and intellectual property rights related to the Sellers’ proprietary CYP11B2 inhibitor compound, formerly known as SE-6440 or VT-6440, and certain other CYP11B2 inhibitor compounds that are covered by the patent rights acquired by the Company under the PB6440 Agreement (together, "Compounds"). Under the terms of the PB6440 Agreement, the Company paid the Sellers an upfront fee of $0.1 million upon the closing of the transaction, and are required to pay the Sellers up to $5.1 million upon the achievement of certain development and intellectual property milestones with respect to certain product candidates that contain a Compound, up to $142.5 million upon the achievement of certain commercial milestones with respect to any approved product that contains a Compound and low- to mid-single digit royalty percentages on the net sales of approved products that contain a Compound, subject to customary reductions and offsets in specified circumstances. The Company incurred zero in costs under the PB6440 Agreement for the three months ended June 30, 2021 and 2020, and zero and $0.1 million for the six months ended June 30, 2021 and 2020, respectively.

BioVectra Supply Agreement

In March 2021, the Company entered into a supply agreement, ("BioVectra Agreement"), with BioVectra Inc. ("BioVectra") for the manufacture and supply by BioVectra of bulk drug substance for bentracimab for commercial distribution following regulatory approval, if obtained. Under the terms of the BioVectra Agreement, BioVectra has committed to maintaining capacity to manufacture an agreed number of batches of product each year, and the Company has committed to purchase a specified minimum number of batches of product per year (the "Minimum Annual Commitment"), although it is free to contract with third parties for the manufacture of bentracimab. The Company will pay a supply price per batch of bentracimab to be determined after the manufacturing process for the bentracimab is validated in accordance with the BioVectra Agreement, plus the cost of certain consumables, raw materials, and third-party testing.

Pursuant to the Minimum Annual Commitments, the Company is obligated to purchase a minimum of (i) approximately $14.0 million of batches of bentracimab in years 2022 through 2023, (ii) approximately $37.0 million of batches of bentracimab in 2024, and (iii) approximately $48.0 million of batches of bentracimab in each of years 2025 through 2031. In the event the Company does not purchase the applicable Minimum Annual Commitment in a given year, it will be obligated to make a payment to BioVectra in an amount equal to the then-applicable supply price per batch multiplied by the difference between the Minimum Annual Commitment for such year and the number of batches of product it actually purchased in such year, except in the event that BioVectra was unable to deliver the number of batches ordered by the Company in such year. The Company will have the right to reduce the Minimum Annual Commitments for the year 2026 and subsequent years by up to a specified maximum percentage per year. Further, if the Company is only able to obtain regulatory approval for products incorporating bentracimab in only one of the United States or Europe, BioVectra and the Company have agreed to discuss in good faith an amendment to the BioVectra Agreement to reflect decreased requirements for product and impacts to the supply price to reflect lower volume commitments.

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Revenue

6 Months Ended

Jun. 30, 2021

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Sublicense revenue

Sublicense revenue relates to the revenue that the Company recognized in relation to the Alfasigma Sublicense. The Company recognized sublicense revenue of $10.3 million and zero in the three months ended June 30, 2021 and 2020 and $10.3 million and zero for the six months ended June 30, 2021 and 2020, respectively.

Grant revenue

In February 2018, the Company received Small Business Innovation Research (“SBIR”) grants from the National Institutes of Health in an aggregate amount of $2.8 million to support the clinical development of pemziviptadil for the treatment of pulmonary arterial hypertension for the period from February 17, 2018 to July 31, 2020. In connection with the SBIR grants, the United States government will receive a non-exclusive, royalty-free license to use any technology the Company develops under such grants. As of March 31, 2020, the Company had received all $2.8 million in funding available under the SBIR grant. The Company recognized zero revenue under the SBIR grants in the three months ended June 30, 2021 and 2020, and zero and $0.3 million for the six months ended June 30, 2021 and 2020, respectively.

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Related Party Transactions	6 Months Ended
	Jun. 30, 2021
Related Party Transactions [Abstract]
Related Party Transactions	Related Party TransactionsAs described above in Note 13, the Company is party to the MedImmune License. AstraZeneca, the parent company of MedImmune, is a related party of the Company.

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Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2021

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying condensed financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) for interim financial reporting and the rules and regulations of the SEC. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations. All adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the accompanying condensed financial statements have been made. Although these interim condensed financial statements do not include all of the information and footnotes required for complete annual financial statements, management believes the disclosures are adequate to make the information presented not misleading. The unaudited interim results of operations and cash flows for the three and six months ended June 30, 2021 are not necessarily indicative of the results that may be expected for the full year. The unaudited interim condensed financial statements and footnotes should be read in conjunction with the audited financial statements and footnotes for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 15, 2021, wherein a more complete discussion of significant accounting policies and certain other information can be found.

Any reference in these notes to applicable guidance is meant to refer to GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) promulgated by the Financial Accounting Standards Board (“FASB”).

The Company manages its operations as a single reportable segment for the purposes of assessing performance and making operating decisions.

Use of Estimates

Use of Estimates

The preparation of the Company’s condensed financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in the Company’s condensed financial statements and accompanying notes. The most significant estimates in the Company’s condensed financial statements relate to the valuation of the development derivative liability, the deferral and recognition of revenue under the Alfasigma Sublicense and the clinical trial accruals. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results could differ materially from those estimates and assumptions.

Concentrations of Credit Risk

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents. The Company maintains certain deposit accounts and money market funds in federally insured financial institutions in excess of federally insured limits. The Company could experience losses on the money market funds in the future.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity from the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents include cash in readily available checking and money market accounts.

Receivable from Sublicense

Receivable from SublicenseReceivable from sublicense relates to amounts due from Alfasigma under the Alfasigma Sublicense. The Company records amounts as accounts receivable when the right to consideration is deemed unconditional.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The carrying amounts of other receivables, prepaid expenses and other assets, accounts payable and accrued expenses and other current liabilities are reasonable estimates of their fair value because of the short maturity of these items. Based on the borrowing rates currently available to the Company for loans with similar terms, the Company believes the fair values of the term loan and operating lease liabilities and corresponding right-of-use assets approximate their respective carrying values.

Revenue Recognition

Deferred Sublicense Revenue

When consideration is received, or such consideration is unconditionally due, from a customer prior to the Company completing its performance obligation to the customer under the terms of a contract, a contract liability is recorded as deferred revenue. Deferred revenues expected to be recognized as revenue within the 12 months following the balance sheet date are classified as current liabilities. Deferred revenues not expected to be recognized as revenue within the 12 months following the balance sheet date are classified as long-term liabilities.

Revenue Recognition

Sublicense Revenue

Sublicensing arrangements may contain multiple components, which may include (i) sublicenses; (ii) research and development activities; and (iii) the manufacturing and supply of certain materials. Payments pursuant to these arrangements may include non-refundable payments, upfront payments, milestone payments upon the achievement of significant regulatory and development events or sales of product at certain agreed-upon amounts, sales milestones and royalties on product sales. The amount of variable consideration is constrained until it is probable that the revenue is not at a significant risk of reversal in a future period.

In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under a sublicense agreement, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are capable of being distinct; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue as the Company satisfies each performance obligation.

The Company must develop estimates and assumptions that require judgment to determine the underlying stand-alone selling price for each performance obligation, which determines how the transaction price is allocated among the performance obligations. The estimation of the stand-alone selling price may include such estimates as forecasted revenues and costs, development timelines, discount rates and probabilities of regulatory and commercial success. The Company also applies significant judgment when evaluating whether contractual obligations represent distinct performance obligations, allocating transaction price to performance obligations within a contract, determining when performance obligations have been met, assessing the recognition and future reversal of variable consideration and determining and applying appropriate methods of measuring progress for performance obligations satisfied over time.

Grant Revenue

Grant revenue is derived from government grants that support the Company’s efforts on specific research projects. The Company has determined that the government agencies providing grants to the Company are not customers. The Company recognizes grant revenue when there is reasonable assurance of compliance with the conditions of the grant and reasonable assurance that the grant revenue will be received.

Development Derivative Liabilities

Development Derivative LiabilityDevelopment derivative liability is recorded based on the present value of the estimated consideration to be received and the estimated consideration to be paid pursuant to contractual terms of the SFJ Agreement, which was determined to have been fair value. The liability is remeasured quarterly, as a Level 3 derivative, with any change in fair value recorded in the form of a gain (loss) from remeasurement of development derivative liability on the condensed statements of operations.

Property and Equipment

Property and Equipment

Property and equipment are recorded at cost and depreciated over the estimated useful lives of the assets (three to five years) using the straight-line method. Leasehold improvements are amortized over the shorter of their estimated useful lives or the lease term.

Leases

Leases

At lease commencement, the Company records a lease liability based on the present value of lease payments over the expected lease term including any options to extend the lease that the Company is reasonably certain to exercise. The Company calculates the present value of lease payments using an incremental borrowing rate as the Company’s leases do not provide an implicit interest rate. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. At the lease commencement date, the Company records a corresponding right-of-use lease asset based on the lease liability, adjusted for any lease incentives received and any initial direct costs paid to the lessor prior to the lease commencement date. The Company may enter into leases with an initial term of 12 months or less (“Short-Term Leases”). For any Short-Term Leases, the Company records the rent expense on a straight-line basis and does not record the leases on the condensed balance sheet. The Company had no Short-Term Leases as of June 30, 2021 or December 31, 2020.

After lease commencement, the Company measures its leases as follows: (i) the lease liability based on the present value of the remaining lease payments using the discount rate determined at lease commencement and (ii) the right-of-use lease asset based on the remeasured lease liability, adjusted for any unamortized lease incentives received, any unamortized initial direct costs and the cumulative difference between rent expense and amounts paid under the lease agreement. Any lease incentives received and any initial direct costs are amortized on a straight-line basis over the expected lease term. Rent expense is recorded on a straight-line basis over the expected lease term.

Long-Lived Assets

Long-Lived Assets

The Company regularly reviews the carrying value and estimated lives of all of its long-lived assets, including property and equipment and right-of-use assets to determine whether indicators of impairment may exist which warrant adjustments to carrying values or estimated useful lives. The determinants used for this evaluation include management’s estimate of the asset’s ability to generate net positive cash flow in future periods as well as the strategic significance of the assets to the Company’s business objectives. Should an impairment exist, the impairment loss would be measured based on the extent that the estimated fair value is less than its carrying value. The Company did not recognize any impairment losses in either the six months ended June 30, 2021 or the year ended December 31, 2020.

Preclinical and Clinical Trial Accruals

Preclinical and Clinical Trial Accruals

The Company accrues and expenses amounts incurred in connection with preclinical studies and clinical trial activities performed by third parties based upon estimates of the proportion of work completed over the life of the individual trial and subject enrollment rates in accordance with agreements with clinical research organizations, contract manufacturing organizations and clinical trial sites. The Company determines the estimates by reviewing contracts, vendor agreements and purchase orders, and through discussions with internal clinical personnel and external service providers as to the progress or stage of completion of trials or services and the agreed-upon fee to be paid for such services. However, actual costs and timing of clinical trials are highly uncertain, subject to risks and may change depending upon a number of factors, including the Company’s clinical development plan.

Management makes estimates of the Company’s accrued expenses as of each balance sheet date in the Company’s condensed financial statements based on facts and circumstances known to the Company at that time. If the actual timing of the performance of services or the level of effort varies from the estimate, the Company will adjust the accrual accordingly. Nonrefundable advance payments for goods and services, including fees for process development or manufacturing and distribution of clinical supplies that will be used in future research and development activities, are deferred and recognized as expense in the period that the related goods are consumed or services are performed.

Research and Development Expense

Research and Development Expense

Research and development costs are expensed as incurred. Costs incurred in obtaining technology licenses are charged to research and development expense if the technology has no alternative future use.

Stock-Based Compensation

Stock-Based Compensation

The Company measures and recognizes compensation expense for all stock-based compensation based on the estimated fair value at the date of grant. Currently, the Company’s stock-based awards consist only of stock options; however, future grants under the Company’s equity compensation plan may also consist of shares of restricted stock, restricted stock units, stock appreciation rights, performance awards and performance units. The Company also maintains the 2018 Employee Stock Purchase Plan ("ESPP") under which it may issue shares of common stock. The Company estimates the fair value of stock options and shares that will be issued under the ESPP using the Black-Scholes option-pricing model, which requires the use of estimates. The Company recognizes stock-based compensation cost for ratably vesting stock options and for shares that it will issue under the ESPP on a straight-line basis over the requisite service period of the award and records forfeitures in the period in which they occur.

The Black-Scholes option-pricing model requires the input of subjective assumptions, including the risk-free interest rate, the expected dividend yield of the Company’s common stock, the expected volatility of the price of the Company’s common stock, and the expected term of the option. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, the Company’s stock-based compensation expense could be materially different in the future.

Income Taxes

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the condensed financial statements. Under this method, deferred tax assets and liabilities are determined on the basis of the differences between the condensed financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

The Company recognizes net deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, management considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If management determines that the Company would be able to realize its deferred tax assets in the future in excess of their net recorded amount, management would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

The Company records uncertain tax positions on the basis of a two-step process whereby (1) management determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, management recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits, if any, within income tax expense, and any accrued interest and penalties are included within the related tax liability line.

Net Loss Per Share

Net Loss Per Share

Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of common shares and common share equivalents outstanding for the period. Common stock equivalents are only included when their effect is dilutive. The Company’s potentially dilutive securities, which include outstanding options under the Company's stock option plan, warrants issued from time to time and shares of common stock to be potentially issued under the ESPP, have been excluded from the computation of diluted net loss per share as they would be anti-dilutive. For all periods presented, there is no difference in the number of shares used to compute basic and diluted shares outstanding due to the Company’s net loss position.

Recent Accounting Pronouncements

Recent Accounting PronouncementsIn December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which among other things, eliminates certain exceptions in the current rules regarding the approach for intraperiod tax allocations and the methodology for calculating income taxes in an interim period, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The standard became effective for the Company in the first quarter of 2021. Adoption of this new standard did not have a material impact on the Company's condensed financial statements and related disclosures.

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Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2021

Accounting Policies [Abstract]

Schedule of Outstanding Potentially Dilutive Securities Excluded in Calculation of Diluted Net Loss Per Share

The following table sets forth the outstanding, potentially dilutive securities that have been excluded in the calculation of diluted net loss per share because their inclusion would be anti-dilutive:

	As of June 30,
	2021	2020
Common stock options	4,359,395	3,740,815
Warrants to purchase common stock	2,349,595	2,349,595
Employee stock purchase plan	275,077	271,012
Total	6,984,067	6,361,422

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Fair Value Measurement (Tables)

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

Summary of Assets and Liabilities that Require Fair Value Measurements on a Recurring Basis

The following table summarizes the Company’s assets and liabilities that require fair value measurements on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):

	Total		Fair Value Measurements at Reporting Date
			Level 1		Level 2		Level 3
As of June 30, 2021:
Assets
Cash equivalents	$	64,236	$	64,236	$	—	$	—
Liabilities
Development derivative liability (Note 8)	$	89,329	$	—	$	—	$	89,329
As of December 31, 2020:
Assets
Cash equivalents	$	27,872	$	27,872	$	—	$	—
Liabilities
Development derivative liability (Note 8)	$	51,719	$	—	$	—	$	51,719

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Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2021

Property, Plant and Equipment [Abstract]

Composition of Property and Equipment, Net

The following table presents the composition of property and equipment, net as of June 30, 2021 and December 31, 2020 (in thousands):

	As of June 30, 2021		As of December 31, 2020
Lab equipment	$	12,244	$	8,994
Computer hardware, software and telephone	140		140
Furniture and fixtures	114		107
Leasehold improvements	77		67
Construction in progress	986		1,042
	13,561		10,350
Less accumulated depreciation	(3,182)		(2,126)
Property and equipment, net	$	10,379	$	8,224

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Accrued Expenses and Other Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2021

Payables and Accruals [Abstract]

Schedule of Composition of Accrued Expenses

The following table presents the composition of accrued expenses and other current liabilities as of June 30, 2021 and December 31, 2020 (in thousands):

	As of June 30, 2021		As of December 31, 2020
Accrued clinical and related costs	$	3,921	$	2,753
Accrued compensation and related costs	1,483		2,260
Accrued interest	52		69
Current portion of operating lease liability	476		459
Accrued other	476		390
Accrued expenses and other current liabilities	$	6,408	$	5,931

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Deferred Sublicense Revenue (Tables)

6 Months Ended

Jun. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Transaction Price to Performance Obligations

The Company allocated the upfront portion of the transaction price to the performance obligations as of June 30, 2021 as follows (in thousands):

	Transaction Price		Cumulative Sublicense Revenue Recognized		Deferred Sublicense Revenue
License	$	10,223	$	10,223	$	—
Development and Regulatory Services	2,647		115		2,532
Supply of License Product	7,130		—		7,130
	$	20,000	$	10,338	9,662
Less current portion of long-term deferred sublicense revenue					(1,424)
Total long-term deferred sublicense revenue					$	8,238

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Debt (Tables)

6 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Summary of Future Principal Payments

The following table sets forth by year the Company’s required future principal payments as of June 30, 2021 (in thousands):

Years Ending December 31,
2021 (remaining six months)	$	2,727
2022	5,455
2023	1,363
Thereafter	—
Total principal payments	9,545
Less unamortized loan fees	(88)
Total term loan borrowings	$	9,457

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Development Derivative Liability (Tables)

6 Months Ended

Jun. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Development Derivative Liability

The following table presents activity for the development derivative liability during the six months ended June 30, 2021 (in thousands):

	Development Derivative Liability
Balance at December 31, 2020	$	51,719
Funding during the period	30,407
Change in fair value	7,203
Balance at June 30, 2021	$	89,329

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Leases (Tables)

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

Schedule of Maturities of Operating Lease Liabilities

Maturities of operating lease liabilities as of June 30, 2021 are as follows (in thousands):

Year Ending December 31,
2021 (remaining six months)	$	283
2022	555
2023	419
2024	279
2025	283
Thereafter	215
Total future minimum lease payments	2,034
Less: Present value adjustment	(252)
Operating lease liabilities	$	1,782

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Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2021

Share-based Payment Arrangement [Abstract]

Stock-based Compensation Expense

Stock-based compensation expense has been reported in the Company’s condensed statements of operations for the three and six months ended June 30, 2021 and 2020 as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
General and administrative	$	510	$	402	$	984	$	742
Research and development	219		173		414		304
Total stock-based compensation	$	729	$	575	$	1,398	$	1,046

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Organization and Description of Business - Additional Information (Details) $ in Thousands	1 Months Ended		3 Months Ended		6 Months Ended
	Jul. 31, 2021 USD ($)	Jun. 30, 2021 USD ($)	Mar. 31, 2021 shares	Jun. 30, 2020 shares	Jun. 30, 2021 USD ($) segment shares	Jun. 30, 2020 USD ($)	Dec. 31, 2020 USD ($)
Organization and Description of Business [Line Item]
Accumulated deficit		$ 316,760			$ 316,760		$ 260,723
Cash and cash equivalents		64,456			64,456		$ 28,122
Working capital		72,300			72,300
Aggregate offering price		200,000			200,000
Proceeds from issuance of common stock					60,351	$ 472
Proceeds from issuance of common stock, deducting underwriting discounts, commissions, and other offering costs					60,200
Aggregate offering price, remaining		132,600			$ 132,600
Reportable segment | segment					1
Common Stock
Organization and Description of Business [Line Item]
Issuance of common stock in public offering, net (in shares) | shares			18,400,000	80,523	18,400,000
SFJ Pharmaceuticals X, Ltd.
Organization and Description of Business [Line Item]
Proceeds from partnership contribution					$ 12,500
Equity Distribution Agreement with Citigroup Global Markets Inc. and William Blair & Company, L.L.C.
Organization and Description of Business [Line Item]
Aggregate offering price		60,000			60,000
Proceeds from issuance of common stock					2,900
Aggregate offering price, remaining		57,000			$ 57,000
Equity Distribution Agreement with Citigroup Global Markets Inc. and William Blair & Company, L.L.C. | Common Stock
Organization and Description of Business [Line Item]
Issuance of common stock in public offering, net (in shares) | shares					561,848
Alfasigma S.p.A.
Organization and Description of Business [Line Item]
Upfront payment from sublicense agreement		$ 20,000
Alfasigma S.p.A. | Subsequent Event [Member]
Organization and Description of Business [Line Item]
Upfront payment from sublicense agreement	$ 20,000

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Significant Accounting Policies - Additional Information (Details)	6 Months Ended
	Jun. 30, 2021
Minimum
Significant Accounting Policies [Line Items]
Property and equipment estimated useful lives (in years)	3 years
Maximum
Significant Accounting Policies [Line Items]
Property and equipment estimated useful lives (in years)	5 years

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Significant Accounting Policies - Schedule of Outstanding Potentially Dilutive Securities Excluded In Calculation Of Diluted Net Loss Per Share (Details) - shares	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Significant Accounting Policies [Line Items]
Outstanding potentially dilutive securities excluded in calculation of diluted net loss per share (in shares)	6,984,067	6,361,422
Common stock options
Significant Accounting Policies [Line Items]
Outstanding potentially dilutive securities excluded in calculation of diluted net loss per share (in shares)	4,359,395	3,740,815
Warrants to purchase common stock
Significant Accounting Policies [Line Items]
Outstanding potentially dilutive securities excluded in calculation of diluted net loss per share (in shares)	2,349,595	2,349,595
Employee stock purchase plan
Significant Accounting Policies [Line Items]
Outstanding potentially dilutive securities excluded in calculation of diluted net loss per share (in shares)	275,077	271,012

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Fair Value Measurement - Summary of Assets and Liabilities that Require Fair Value Measurements on a Recurring Basis (Details) - Fair Value Measurements on Recurring Basis - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Assets
Cash equivalents	$ 64,236	$ 27,872
Liabilities
Development derivative liability (Note 8)	89,329	51,719
Level 1
Assets
Cash equivalents	64,236	27,872
Liabilities
Development derivative liability (Note 8)	0	0
Level 2
Assets
Cash equivalents	0	0
Liabilities
Development derivative liability (Note 8)	0	0
Level 3
Assets
Cash equivalents	0	0
Liabilities
Development derivative liability (Note 8)	$ 89,329	$ 51,719

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Property and Equipment - Composition of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 13,561	$ 10,350
Less accumulated depreciation	(3,182)	(2,126)
Property and equipment, net	10,379	8,224
Lab equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	12,244	8,994
Computer hardware, software and telephone
Property, Plant and Equipment [Line Items]
Property and equipment, gross	140	140
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	114	107
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	77	67
Construction in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 986	$ 1,042

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Property and Equipment - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Property, Plant and Equipment [Abstract]
Depreciation	$ 0.6	$ 0.1	$ 1.1	$ 0.1

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Accrued Expenses and Other Current Liabilities - Schedule of Composition of Accrued Expenses (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Payables and Accruals [Abstract]
Accrued clinical and related costs	$ 3,921	$ 2,753
Accrued compensation and related costs	1,483	2,260
Accrued interest	52	69
Current portion of operating lease liability	476	459
Accrued other	476	390
Accrued expenses and other current liabilities	$ 6,408	$ 5,931

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Deferred Sublicense Revenue - Additional Information (Details) $ in Millions	1 Months Ended
	Jun. 30, 2021 USD ($)
Alfasigma S.p.A. | Achievement Of Certain Pre-Revenue Regulatory Milestones
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Potential milestones payment	$ 35.0
Alfasigma S.p.A. | Achievement Of Certain Commercial Milestones And Tiered Royalty Payments On Net Sales
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Potential milestones payment	190.0
Alfasigma S.p.A. | EMA Approval Of Application For Licensed Product
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Potential milestones payment	10.0
Alfasigma S.p.A. | Achievement Of Conditional Regulatory Approval From EMA
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Potential milestones payment	12.5
Alfasigma S.p.A. | Achievement Of Unconditional Regulatory Approval From EMA
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Potential milestones payment	12.5
Alfasigma S.p.A.
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Upfront payment from sublicense agreement	$ 20.0

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Deferred Sublicense Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Cumulative Sublicense Revenue Recognized	$ 10,338	$ 0	$ 10,338	$ 320
Less current portion of long-term deferred sublicense revenue	(1,424)		(1,424)		$ 0
Total long-term deferred sublicense revenue	8,238		8,238		$ 0
Alfasigma S.p.A.
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Transaction Price			20,000
Cumulative Sublicense Revenue Recognized			10,338
Deferred Sublicense Revenue	9,662		9,662
Less current portion of long-term deferred sublicense revenue	(1,424)		(1,424)
Total long-term deferred sublicense revenue	8,238		8,238
License | Alfasigma S.p.A.
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Transaction Price			10,223
Cumulative Sublicense Revenue Recognized			10,223
Deferred Sublicense Revenue	0		0
Development and Regulatory Services | Alfasigma S.p.A.
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Transaction Price			2,647
Cumulative Sublicense Revenue Recognized			115
Deferred Sublicense Revenue	2,532		2,532
Supply of License Product | Alfasigma S.p.A.
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Transaction Price			7,130
Cumulative Sublicense Revenue Recognized			0
Deferred Sublicense Revenue	$ 7,130		$ 7,130

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Debt - Additional Information (Details)	1 Months Ended	3 Months Ended		6 Months Ended
	Mar. 31, 2019 USD ($) tranche $ / shares shares	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Oct. 31, 2019 $ / shares shares	Jun. 30, 2019	May 31, 2019 $ / shares shares
SVB and WestRiver
Debt Instrument [Line Items]
Expiration term	10 years
Long-term debt		$ 9,545,000		$ 9,545,000
SVB and WestRiver | Tranche 1
Debt Instrument [Line Items]
Number of warrants issued (in shares) | shares	37,606
Exercise price of warrant (in usd per share) | $ / shares	$ 4.73
Proceeds from lines of credit	$ 7,500,000
SVB and WestRiver | Tranche 2
Debt Instrument [Line Items]
Number of warrants issued (in shares) | shares								12,130
Exercise price of warrant (in usd per share) | $ / shares								$ 10.86
SVB and WestRiver | Tranche 3
Debt Instrument [Line Items]
Number of warrants issued (in shares) | shares						24,262
Exercise price of warrant (in usd per share) | $ / shares						$ 3.88
Silicon Valley Bank
Debt Instrument [Line Items]
Percentage of final payment on principal amount of refinanced advances							6.00%
Long-term debt		700,000		700,000
Silicon Valley Bank | Tranche 1, 2, and 3
Debt Instrument [Line Items]
Interest rate	6.50%
Amortization period of payments of principal plus interest amounts	33 months
Silicon Valley Bank | Tranche 1, 2, and 3 | Prime Rate
Debt Instrument [Line Items]
Interest rate, percentage point added to reference rate	1.00%
Term Loan | SVB and WestRiver
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 15,000,000.0
Number of tranches | tranche	3
Term Loan | SVB and WestRiver | Tranche 1
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 7,500,000
Term Loan | Silicon Valley Bank
Debt Instrument [Line Items]
Interest expense		300,000	$ 400,000	500,000	$ 800,000
Term Loan | Silicon Valley Bank | Tranche 1, 2, and 3
Debt Instrument [Line Items]
Debt discount		$ 400,000		$ 400,000
Term Loan | Silicon Valley Bank | Tranche 2
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	2,500,000
Term Loan | Silicon Valley Bank | Tranche 3
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 5,000,000.0

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Debt - Summary of Future Principal Payments (Details) - SVB and WestRiver $ in Thousands	Jun. 30, 2021 USD ($)
Debt Instrument [Line Items]
2021 (remaining six months)	$ 2,727
2022	5,455
2023	1,363
Thereafter	0
Total principal payments	9,545
Less unamortized loan fees	(88)
Total term loan borrowings	$ 9,457

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Development Derivative Liability - Narrative (Details)	1 Months Ended	3 Months Ended		6 Months Ended
	Jan. 31, 2020 USD ($)	Jun. 30, 2021 USD ($) payment tranche $ / shares shares	Jun. 30, 2020 USD ($)	Jun. 30, 2021 USD ($) payment tranche $ / shares shares	Jun. 30, 2020 USD ($)	Dec. 31, 2020 USD ($) shares
Derivative [Line Items]
Common stock, shares issued (in shares) | shares		48,057,720		48,057,720		29,471,854
Common stock, shares issued, value		$ 48,000		$ 48,000		$ 29,000
Derivative
Derivative [Line Items]
Initial liability				2,100,000
Funding during the period				30,400,000
Change in fair value		$ 5,800,000	$ 3,700,000	7,200,000	$ 4,200,000
SFJ Agreement
Derivative [Line Items]
Potential milestones payment				$ 120,000,000.0
Cost of borrowing rate				16.00%
SFJ Pharmaceuticals
Derivative [Line Items]
Cost of borrowing rate				2.50%
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | SFJ Agreement
Derivative [Line Items]
Common stock, shares issued (in shares) | shares		2,200,000		2,200,000
Shares issued (in usd per share) | $ / shares		$ 6.50		$ 6.50
Common stock, shares issued term				10 years
Number of tranches | tranche		2		2
Common stock, shares issued, value		$ 7,900,000		$ 7,900,000
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | SFJ Agreement | Derivative
Derivative [Line Items]
Funding during the period				30,407,000
Change in fair value				$ 7,203,000
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | SFJ Agreement | Tranche A
Derivative [Line Items]
Common stock, shares issued (in shares) | shares		1,100,000		1,100,000
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | SFJ Agreement | Tranche B
Derivative [Line Items]
Common stock, shares issued (in shares) | shares		1,100,000		1,100,000
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | bentracimab | SFJ Agreement
Derivative [Line Items]
Potential milestones payment receivable	$ 120,000,000.0			$ 30,000,000.0
Additional payment for license				77,500,000
Additional payment received for license agreement				12,500,000
Initial payment received for license agreement				10,000,000.0
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | bentracimab | United States Food And Drug Administration | SFJ Agreement
Derivative [Line Items]
Additional payment for license				325,000,000.0
Initial payment for license				$ 5,000,000.0
Number of additional annual payments | payment		7		7
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | bentracimab | European Medicines Agency | SFJ Agreement
Derivative [Line Items]
Additional payment for license				$ 205,000,000.0
Initial payment for license				$ 5,000,000.0
Number of additional annual payments | payment		7		7
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | bentracimab | Pharmaceuticals And Medical Devices Agency Of Japan And National Medical Productions Administration Of China | SFJ Agreement
Derivative [Line Items]
Additional payment for license				$ 59,000,000.0
Initial payment for license				$ 1,000,000.0
Number of additional annual payments | payment		8		8

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Development Derivative Liability - Roll Forward (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Revenue	$ 10,338	$ 0	$ 10,338	$ 320
Current portion of deferred sublicense revenue	1,424		1,424		$ 0
Deferred sublicense revenue, net	8,238		8,238		$ 0
Alfasigma S.p.A.
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Transaction Price			20,000
Revenue			10,338
Deferred Sublicense Revenue	9,662		9,662
Current portion of deferred sublicense revenue	1,424		1,424
Deferred sublicense revenue, net	8,238		8,238
License | Alfasigma S.p.A.
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Transaction Price			10,223
Revenue			10,223
Deferred Sublicense Revenue	0		0
Development and Regulatory Services | Alfasigma S.p.A.
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Transaction Price			2,647
Revenue			115
Deferred Sublicense Revenue	2,532		2,532
Supply of License Product | Alfasigma S.p.A.
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Transaction Price			7,130
Revenue			0
Deferred Sublicense Revenue	7,130		7,130
Derivative
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Funding during the period			30,400
Change in fair value	5,800	$ 3,700	7,200	$ 4,200
Derivative | SFJ Agreement | Collaborative Arrangement, Transaction with Party to Collaborative Arrangement
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at December 31, 2020			51,719
Funding during the period			30,407
Change in fair value			7,203
Balance at March 31, 2021	$ 89,329		$ 89,329

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Leases - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Jan. 31, 2010
Leases [Abstract]
Option to extend (in years)					3 years
Weighted average remaining lease term (in years)	4 years 2 months 12 days		4 years 2 months 12 days
Weighted average discount rate used to determine the right-of-use assets and corresponding operating lease liabilities	5.80%		5.80%
Rent expense	$ 0.2	$ 0.1	$ 0.4	$ 0.2

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Leases - Schedule of Maturities of Operating Lease Liabilities (Details) $ in Thousands	Jun. 30, 2021 USD ($)
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
2021 (remaining six months)	$ 283
2022	555
2023	419
2024	279
2025	283
Thereafter	215
Total future minimum lease payments	2,034
Less: Present value adjustment	(252)
Operating lease liabilities	$ 1,782

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Stockholders' Equity - Additional Information (Details) - USD ($)	1 Months Ended	3 Months Ended		6 Months Ended
	Mar. 31, 2021	Mar. 31, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2019
Class of Stock [Line Items]
Aggregate offering price						$ 200,000,000.0
Aggregate offering price, remaining				$ 132,600,000
Proceeds from issuance of common stock				$ 60,351,000	$ 472,000
Common Stock
Class of Stock [Line Items]
Common stock, shares, issued and sold (in shares)		18,400,000	80,523	18,400,000
Equity Distribution Agreement with Citigroup Global Markets Inc. and William Blair & Company, L.L.C.
Class of Stock [Line Items]
Aggregate offering price						$ 60,000,000.0
Aggregate offering price, remaining				$ 57,000,000.0
Proceeds from issuance of common stock				$ 2,900,000
Equity Distribution Agreement with Citigroup Global Markets Inc. and William Blair & Company, L.L.C. | Common Stock
Class of Stock [Line Items]
Common stock, shares, issued and sold (in shares)				561,848
ATM Program
Class of Stock [Line Items]
Proceeds from issuance of common stock				$ 2,900,000
ATM Program | Common Stock
Class of Stock [Line Items]
Common stock, shares, issued and sold (in shares)				561,848
March 2021 Offering
Class of Stock [Line Items]
Common stock, shares, issued and sold (in shares)	18,400,000
Common stock, public offering price (in usd per share)	$ 3.50	$ 3.50
Proceeds from issuance of common stock in public offering, net	$ 60,200,000

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Stock-Based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 729	$ 575	$ 1,398	$ 1,046
General and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	510	402	984	742
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation	$ 219	$ 173	$ 414	$ 304

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Stock-Based Compensation - Additional Information (Details) $ in Thousands	1 Months Ended		3 Months Ended		6 Months Ended
	Mar. 31, 2020	Oct. 31, 2018 purchasePeriod	Jun. 30, 2021 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2021 USD ($) shares	Jun. 30, 2020 USD ($) shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense			$ 729	$ 575	$ 1,398	$ 1,046
ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense			200		$ 200
Weighted-average period expected to be recognized (in years)					9 months 18 days
Percentage of employee's compensation, maximum		15.00%
Offering period (in months)		24 months
Number of purchase periods | purchasePeriod		4
Purchase period, term	6 months
Percentage of lower of fair market value		85.00%
Stock-based compensation expense			100	$ 21	$ 100	$ 21
Issuance of common stock through employee share purchase plan (in shares) | shares					72,105	0
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense			$ 5,600		$ 5,600
Weighted-average period expected to be recognized (in years)					2 years 6 months

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Licenses and Other Agreements - Additional Information (Details) - USD ($)	1 Months Ended			3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jan. 31, 2020	Nov. 30, 2017	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Mar. 31, 2021
License Agreements [Line Items]
Research and development				$ 27,366,000	$ 20,856,000	$ 49,686,000	$ 32,305,000
Purchase obligation, year 2022 through 2023								$ 14,000,000.0
Purchase obligation, year 2024								37,000,000.0
Purchase obligation, year 2025 through 2031								$ 48,000,000.0
Duke University
License Agreements [Line Items]
Aggregate royalties payment						200,000
Sale of licensed products or services						0
Fees payment						300,000
Nonroyalty payment received						1,000,000.0
Research and development						0	0
Wacker
License Agreements [Line Items]
Research and development				100,000	100,000	200,000	200,000
Viamet Pharmaceuticals Holdings, LLC
License Agreements [Line Items]
Research and development				$ 0	$ 0	0	$ 100,000
License agreement upfront payment		$ 100,000
Achievement Of Clinical Development And Regulatory Milestones | Duke University
License Agreements [Line Items]
Potential milestones payment						2,200,000
Commercial Milestones | Duke University
License Agreements [Line Items]
Potential milestones payment						$ 400,000
Commercial Milestones | Viamet Pharmaceuticals Holdings, LLC
License Agreements [Line Items]
Potential milestones payment		142,500,000
Achievement Of Certain Pre-Revenue Regulatory Milestones | Alfasigma S.p.A.
License Agreements [Line Items]
Potential milestones payment	$ 35,000,000.0
Achievement Of Certain Commercial Milestones And Tiered Royalty Payments On Net Sales | Alfasigma S.p.A.
License Agreements [Line Items]
Potential milestones payment	190,000,000.0
EMA Approval Of Application For Licensed Product | Alfasigma S.p.A.
License Agreements [Line Items]
Potential milestones payment	10,000,000.0
Achievement Of Conditional Regulatory Approval From EMA | Alfasigma S.p.A.
License Agreements [Line Items]
Potential milestones payment	12,500,000
Achievement Of Unconditional Regulatory Approval From EMA | Alfasigma S.p.A.
License Agreements [Line Items]
Potential milestones payment	12,500,000
Achievement Of Certain Development And Intellectual Property Milestones | Viamet Pharmaceuticals Holdings, LLC
License Agreements [Line Items]
Potential milestones payment		$ 5,100,000
MedImmune Limited
License Agreements [Line Items]
Milestone payment			$ 3,000,000.0
MedImmune Limited | Achievement Of Clinical Development And Regulatory Milestones
License Agreements [Line Items]
Potential milestones payment			15,000,000.0
MedImmune Limited | Commercial Milestones
License Agreements [Line Items]
Potential milestones payment			$ 50,000,000.0
Alfasigma S.p.A.
License Agreements [Line Items]
Upfront payment from sublicense agreement	$ 20,000,000.0

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Revenue - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended			6 Months Ended
	Feb. 28, 2018	Jun. 30, 2021	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2021	Jun. 30, 2020
Disaggregation of Revenue [Line Items]
Revenue		$ 10,338	$ 0		$ 10,338	$ 320
Sublicense revenue
Disaggregation of Revenue [Line Items]
Revenue		10,338	0		10,338	0
SBIR Grants
Disaggregation of Revenue [Line Items]
Revenue		$ 0	$ 0		$ 0	$ 300
Grants from the National Institutes of Health	$ 2,800			$ 2,800